Stocks
Federal Reserve Chairman Alan Greenspan ended the stock market's winning streak Friday by reminding investors that the United States cannot count on the rest of the world to keep lending us the money to live beyond our means.
The trade and budget deficits "cannot continue to increase forever" at the rate they have been growing, Greenspan said in a speech in Frankfurt that rolled across the Atlantic like a tidal wave and wiped out all the profits investors had earned earlier in the week.
Though only subtly different from what Greenspan had said before, the remarks were followed by the Dow Jones industrial average's biggest single-day drop in almost two months. The 115-point skid wiped out three days of gains, leaving the Dow down 82 points for the week, a loss of 0.8 percent. The Nasdaq composite index fell 15 points, or 0.7 percent. The Standard & Poor's 500-stock index lost 14 points, or 1.2 percent.
The Greenspan retreat also broke the election rally that had provided four winning weeks in a row for the Nasdaq and three-week streaks for the Dow and S&P 500.
