Huge infusions of cash have stemmed the bleeding in the financial sector, but "conditions in financial markets are still far from normal," Fed Chairman Ben Bernanke said in a speech today. He vowed to increase the already massive amount of cash it has lent to investment banks in an attempt to keep markets from seizing up.
That follows comments yesterday by Jamie Dimon of J.P.Morgan that the credit crunch may soon be over, though he predicted the coming (or current) recession will continue at a "slower burn" and could rival the 1982 downturn.
Bank of America has added a new bit of bad news as well. Its mortgage customers are in worse shape than previously thought. Liam McGee, president of its global consumer and small-business banking arm, told a conference today that they're facing "significant economic pressure" from falling home prices. For the bank, that means losses from its home equity portfolio will probably exceed current forecasts of 2 percent to 2.5 percent.