Wall Street bounces back

Tuesday, October 14th 2008, 3:58 pm
By: News 9

By Rusty Surette, NEWS 9

OKLAHOMA CITY -- Wall Street stormed back Monday from last week's devastating losses. The Dow soared more than 900 points.

The momentous shift left many wondering what the roller coaster meant for the local economy, and how did the market transition from its worst week to its best day ever?

One economic professor said it's like watching flock of birds. If the leaders suddenly shift direction in mid-flight, the rest of the birds will follow and go the same way. OCU's Dr. David May said that's exactly what happened on Wall Street Monday following a weekend of encouraging news.

Monday resulted in the biggest single-day point rally in the Dow's history.

Stocks soared around the world in response to dramatic efforts by governments to save the markets. As a result, investors and banking firms reacted in a positive manner, sending the DOW up.

"I think it's expected. You can't go down forever," May said.

May said it was only a matter of time before the stocks rebounded, but nobody expected it as soon as Monday, or as fast as it progressed. May went on to say the country's economy is not out of the woods yet.

"I expect over the next six to eight months, I think you'll see a certain increase as long as government action continues to do what's it's doing," May said.

Oklahoma City's mayor responded to growing concerns following the decision by Chesapeake Energy's CEO to sell most of his company stock.

"Our banks are solid, we're not seeing large numbers of people unable to pay mortgages and we've diversified our economy," Mayor Mick Cornett said. "We're not nearly as reliant on the energy sector as we once were."

In Nichols Hills, small business owners like Spencer Stone, are cautiously optimistic about the economy and his customers. He claims economic success is about planning.

"When times are good, you tend to get lazy," Stone said. "When times get tough is really when the cream rises to the top. People have to adapt and the people that think fast will make it, and those who slow down and wait for somebody to rescue them won't."

In regards to fuel prices, Dr. May said as long as demand stays where it is, he thinks prices will stay where they are within a 50 cent range for awhile.

On Tuesday, the Bush administration is expected to unveil additional sweeping measures to shore up the nation's financial system and restore confidence in it.