STATE OF BUSINESS: Building Back Confidence

The stock market perked up last week after the Federal Reserve Board made its long-awaited reduction in margin requirements from 90% to 70% (see Essay). The news came after the market had declined for the twelfth time in 13 trading sessions, sent the Dow-Jones industrial average up 14.97 points in two days to close at 616.73, ahead 6.86 for the week. Wall Street wondered just how long the rally would last. The market had dropped 45.15 points during the 13-day period, and last week's rise was interpreted as the response of increased...

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