Yesterday, the Dow Jones Industrial Average (DOW) dropped 276.10 points to close at 11,955.01. Today, it ended down 297.05 points (2.5%), to 11,657.96, led by roughly 6% drops in both Bank of America Corp. and J.P. Morgan Chase. These amounted to two days of heavy losses for the index over the seemingly never ending drama that is Greece’s failed economy.
Marc Pado, U.S. market strategist at Cantor Fitzgerald said recently, “This is the reason why we have less and less participation by retail investors in this market; we don’t know if we’re going to open up 300 points or down 200 points, that’s too much stress for the average person, who doesn’t understand why Greece’s debt makes a difference for them.”
The stunning decision by Greece to call a referendum on its bailout, a request made by Prime Minister George Papandreou late in Monday’s U.S. stock session, reinserted a heavy dose of uncertainty into global markets. The arrogance of Papandreou’s move for a referendum illustrates he and many around him don’t see the writing on the wall: Greece simply cannot manage its current debt and will inevitably default.
