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Between today and yesterday, it is almost as if Monday's massive rally never happened. US markets moved down an average of well over 8%.

The details:

DJIA: 8,570.19 off 7.96%

Nasdaq: 1,628.33 off 8.45%

S&P 500 907.32 off 9.06%

JPMorgan Chase (NYSE: JPM) has just released earnings and Jamie Dimon is showing he is a better manager than we even knew he was. The banking giant made $0.11 EPS on $14.74 billion in revenues. First Call had estimates at -$0.21 EPS and roughly $16 billion in revenues.

Investors tend to forget that some of the world largest PC companies are based in China, lead by Lenovo and Acer. The two companies run behind Dell (NASDAQ:DELL) and Hewlett-Packard (NYSE:HPQ) in global market share. But, that may be changing in a way that the two US companies will find unpleasant.

Research firm Gartner looked at PC sales around the world during the third quarter. According to Reuters, "Overall, worldwide PC shipments rose 15 percent from last year to 80.6 million units." To no one's surprise, growth in the US was slower, up 4.6%.

HP's global market share was 18.4% and Dell's was 13.6%. Acer rose to 12.5% making it the most improved of the three compared with last year.

Acer's secret is that it is selling netbooks, small PCs which usually cost under $500. Analysts have questioned whether consumers would want these because smartphones have many of the same functions. Acer has taken the gamble of ramping up production, a potentially risky move if the customers were not out there. The decision is giving them a chance to steal a march on the larger rivals.

The Acer move may say as much about what is wrong with US PC companies as its says about what is right at Acer. There are many people, especially in emerging markets, who are not likely to be able to spend $1,000 on a computer. And, the mobility of the US PC user is improving with the success of WiFi and 3G.

Dell and HP should be concerned every time they see someone walking down the street with a netbook. It has probably been sold to them by a competitor.

Douglas A McIntyre is an editor at 247wallst.com.

Big US companies must not think much of their own prospects. With many stocks at multi-year lows, firms are not stepping up to buy their own shares. That seems odd because a number of the largest corporations are sitting on billions of dollars in cash. The lack of buybacks may be as bearish a sign as investors can find.

According to the FT, "Regulators have sought to encourage companies to buy shares in the open market by easing restrictions on corporate buy-backs as part of emergency measures introduced last month." But, no dice.

It is understandable the forums with modest cash balances would not be in the buyback market, but that leaves a number of very large, cash-rich corporations from Altria (NYSE:MO) to Google (NASDAQ:GOOG). They almost certainly have excess capital that they will not need, even in a deep recession.

The lack of buybacks leads to only one conclusion. Company managements and boards think their stocks will go much lower. They do not want to look foolish if they put capital into falling shares But, over a long period of time America's large corporations should hold their value. Too bad even insiders do not look at it that way.

Douglas A. McIntyre is an editor at 247wallst.com.

The banking crisis may be over, at least for now. Paulson's $700 billion plan has given big banks and brokerages a chance to re-balance their balance sheets. Whether they will lend that out is another matter.

But, bankiing is not the largest crisis facing the country as the recession takes hold. Jobs are. Unemployment was 6.1% in September, but if the 1973 and 1981 recessions are any guide, the number could for to 9%. That would put hundreds of thousand more people out of work.

According to Reuters, "Nearly half the U.S. workers polled in a survey released on Tuesday said they were worried their jobs are at risk amid the current economic crisis." The poll was down by Workplace Options.

Americans have watched huge cuts in the auto and airline industries. That is moving to the financial sector as earnings there fall and mergers allow for lay-offs. But, that is not the end of it by any means. Hewlett-Packard (NYSE:HPQ) recently said it was cutting nearly 25,000 people. Yesterday, Pepsi (NYSE:PEP) said that weak earnings would cause it to cut 3,300 people, and Daimler announced that slow truck sales would make it fire workers in Canada and the US.

The reality is that as more and more companies post poor earnings, more and more people will loss their jobs. Small businesses are the largest employers in the US. Most cannot get access to capital because of the credit crunch. That means more people out of work.

The recession is growing. Some economists believe it could last four or five quarters. Joblessness in the US is about to skyrocket.

Douglas A. McIntyre is an editor at 247wallst.com.

Not much has been said about the number of UAW or white collar workers who would lose jobs if GM (NYSE:GM) merged with Chrysler. It would probably be a ton.

Chrysler has close to 200,000 jobs and GM as over 263,000. According to Reuters, "I would personally not want to see anything that would result in a consolidation that would mean the elimination of additional jobs," UAW President Ron Gettelfinger told Detroit local radio station WWJ."

Dream on. The entire purpose of a merger would be to cut costs. While some of that would be done by cutting jobs in administration, finance, and product development, the big saving are in closing plants and killing brands. For two companies which together would have nearly 500,000 employees, that would mean the elimination of tens of thousands of jobs in an industry which has already been downsized to death.

What is certain is that the UAW will not take a merger sitting down. It already gave significant concessions in its last round of negotiations with the Big Three. At some point the union loses even more bargaining power if the car companies can beat it up and takes it lunch money whenever they want to.

If the merger does happen, and that is far from certain, look for labor unrest which has not been seen for several decades. The only way to save jobs will be to strike.

Douglas A. McIntyre is an editor at 247wallst.com.

Today's markets were looking like another great day was in the works, but then we saw a classic "gap and crap" trading day where the market gapped higher by enough that traders decided to sell rather than buy. Despite whipping around and uncertainty over the stock market, this bailout package is taking away the flight to quality trading and the 10-Year T-Note yield was 0.16% higher today alone at 4.02% as a result.

Here are today's unofficial closing bell levels:

DJIA: 9,310.99 (down .82%)

S&P 500: 997.99 (down .53%)

NASDAQ: 1,779.01 (down 3.54%)

Top Analyst Upgrades

Apple Inc. (NASDAQ: AAPL) was down 3% in the minutes before the closing bell today, with shares at $106.65. Steve Jobs issued some new MacBooks for the introductory price of $999 to get under the $1,000.00 hurdle, but Wall Street didn't care about its new offerings, which are scheduled to come in time for Christmas.

Fifth Third Bancorp (NASDAQ: FITB) was up a sharp 18% at $12.91 today immediately before the close after the Fed's rescue package to invest in banks. It wasn't one of the big banks to get funding, but the hope is for Fed money or that it gets bought.

Johnson & Johnson (NYSE: JNJ) showed that some companies can weather a tough consumer. It beat earnings and raised its guidance, and that was enough for it to rally. Shares were up 2.5% at $64.25 right before the close.

Pepsico, Inc. (NYSE: PEP) was the disaster that wasn't expected. The money pinch is hurting bottled beverage sales if you can believe it. Earnings were light, guidance was soft, and 3,300 jobs are getting the axe. Job cuts at Pepsi, go figure. Shares were down almost 12% at $54.42 right before the close.

Yahoo! Inc. (NASDAQ: YHOO) was down 6.3% at $12.64 right before the close on more and more talks that it is close to doing a deal with AOL. Wall Street isn't ready to endorse that today in tight markets.

Douglas A. McIntyre is an editor at 24/7 Wall St.

The US markets did have a furious rally, rising 11% on major indexes. Overnight, Japan's Nikkei was up over 14%. The move to put money into banks and credit markets appears to be working.

But, don't forget the recession, which many economists see lasting longer than any downturn since 1974. Unemployment went to nearly 9% then. That is about 50% higher than the current 6.1% rate.

Yesterday, General Motors Corporation (NYSE:GM) said it would cut production more. Who would be surprised if the auto industry cut more jobs? The financial sector has lost tens of thousand of jobs, and as bank mergers go through, that is likely to go up sharply.

If there is on element which could pull the stock market back down, it is the realization that the economy is getting much, much worse and that corporate earnings will suffer accordingly.

A new wave of data about the economy will be coming soon. According to The Wall Street Journal, "The biggest data point is: the Census Bureau's retail sales report for September, on Wednesday. Economists expect sales tumbled for the third straight month, led by abysmal auto sales."

Investors who pour their money back into the market now, do so at their own peril. Don't forget the recession.

Douglas A. McIntyre is an editor at 247wallst.com.

Google (NASDAQ:GOOG) and Yahoo! (NASDAQ:YHOO) still want their deal for the large search engine company to sell search advertising for the large portal company. Yahoo! knows that Google's system for selling these ads is more efficient. Yahoo! should make more money under the arrangement.

But, almost every large advertiser in the US and Google's competitors want to block the partnership. They don't want Google to have broad pricing power over search. It has about 65% of the market and Yahoo! has another 20%. According to The Wall Street Journal, "Advertisers have told Justice Department officials that the partnership will limit competition, raise prices and reduce choices."

The Justice Department, which has to review whether the deal works under antitrust laws, is getting itchy.

So, what happens? If Google has any sense, it will throw Yahoo! under the bus and walk away. Google stands to get in real trouble with Justice if the government decides to look at the company's share of search even without the Yahoo! deal. It is better off leaving quietly. Google is not likely to make a huge amount of money from selling ads for Yahoo! since the money will be split between the two companies.

Yahoo!, which is struggling to improve revenue and with its stock near a 52-week low, needs the new sales from Google. And, if the larger company exits the deal, Yahoo! has a major problem.

Douglas A. McIntyre is an editor at 247wallst.com

Merck (NYSE: MRK) lost a lot of legal cases over whether its arthritis drug caused heart problems in patients. It even spent $4.85 billion to settle a lot of the claims against it. But, that did not end every suit, and the company is faced with new data that raises questions about the dangers of the drug.

Tough for Merck. But, putting out dangerous drugs can have side affects for both patient and company. According to Reuters, " A long-term analysis of people who took the arthritis drug Vioxx confirms it doubles the risk of strokes and heart attacks."

Most of these lawsuits come down to "did the company know of the danger, and, if so when?" Merck probably did not settle so many cases because it believed it was entirely in the right. It is hard to imagine that it did not have some sense that the data from the new study is true. It did test its own drug before it went on the market. But, did it test it well? Or, did it find that there were possible health risks but that they were acceptable? At least from a monetary standpoint.

The cynical observers of drug company practices say that the firms balance litigation costs against the money that they get from sales. If a product has some danger, it does not matter too much if it makes a great deal more money than the cost of legal consequences.

If the cynics are right, Merck has a tough road ahead.

Douglas A. McIntyre is an editor at 247wallst.com.

The Treasury did not ask several of the nation's largest banks and investment houses whether they wanted new capital. It told them. So weak banks got money and so did strong ones.

According to Reuters, "The United States will announce plans on Tuesday to inject $250 billion into its banks." Money will go in as preferred stock so common shareholders will not be diluted, unless one of the banks comes close to failure. But, JP Morgan (NYSE: JPM) is being forced to take the same $25 billion that Citigroup (NYSE: C) is. Goldman Sachs (NYSE: GS) and Morgan Stanly (NYSE: MS) will each have to take $10 billion.

The plan is ill-conceived and unfair when the more healthy firms like JPM and Goldman have to take on the same debt burden as weaker competitors. Treasury might argue that it does not have time to make these distinctions, but critical measures like reserves and earnings might have been taken into account. The Treasury might also have told the CEOs of the companies that if everyone did not take capital that full confidence in the system could not be restored.

Unfortunately, the action by the government shows that its work will be done with a hammer and not a scalpel. Over time, this may have very significant drawbacks. There are limited funds to be put to work. Why waste them on the healthy institutions?

Douglas A. McIntyre is an editor at 247wallst.com.

In an effort to make the US rally seem modest, the Japanese Nikkei rose 14.3% overnight. Some large exporters were up 17% or more.

In Hong Kong, the Hang Seng was up 4.4%

As Europe opened, the German DAX rose 3.5%. The FTSE rose 1.9% and the French CAC40 was up 2.1%

Data from Reuters.

Douglas A. McIntyre is an editor at 247wallst.com.

It is the dream of almost every mobile PC users that at some point the broadband airwaves will be free. No more connecting to one expensive WiFi service at one airport only to have to pay for another at the next stop. No more expensive 3G service.

The day may be coming. According to The Wall Street Journal, a new FCC "report clears the way for the FCC to move forward with a plan to auction off airwaves to a bidder who agrees to offer free, national wireless Internet service."

Although the study indicates that most wireless carriers will not be hurt by the program, that is almost certainly not true. By many estimates the free service will be available to 50% of the US population in four years.

The new plan may well do some significant damage to major cellular and WiFi providers. Free is free, and $59 a month can be expensive. How many people will opt to pay for service when they don't need to?

The other industries that could experience some level of harm are the cable companies and telecoms, which offer wired broadband to the home. A good wireless alternative may allow some people to cancel those services.

The FCC regulates the wireless and wired communications companies. Now it means to undermine them.

Douglas A. McIntyre is an editor at 247wallst.com.

The big season for picking up sales, and market share, in the video game console business is the holidays. Shoppers are out buying the things for themselves and their kids. But, this is a recession holiday and that means that selling any consumer electronics device will be hard.

Shoppers are looking for discounts. Sony (NYSE:SNE) has decided to play the fool and not lower prices on its PS3. It is hard to understand why they would make such a significant mistake. It gives Nintendo and Microsoft (NASDAQ:MSFT) the chance to take the lion's share of the customers.

According to the FT, "Sony, the Japanese consumer electronics group, has ruled out cutting the price of the PlayStation 3 console before Christmas, insisting that the PS3 is better value than rivals half its price." Since the Nintedo Wii has outsold the PS3 almost every month since Sony hit the market with its new product, it is hard to see why that would change.

Sony's game business has undermined the company's earnings for several years. It was late to market with the PS3, and now it is likely to be overwhelmed in the fourth quarter by its competition.

Douglas A. McIntyre is an editor at 247wallst.com.

Boeing (NYSE:BA) has gotten a federal mediator on board to help in its negotiations with machinists. It does so as its 787 Dreamliner's deliver date gets later and later. That will further anger customers who have lived though two delays, help rival Airbus pick up business, and allow airlines to ask for compensation for late delivery.

According to Reuters, "Production at Boeing's Seattle-area factories has been suspended since September 6 when 27,000 workers represented by the International Association of Machinists and Aerospace Workers walked off the job." Boeing wants to outsource more of its work. The union objects for obvious reasons.

Boeing should have done almost anything necessary to keep the unions in. The labor contract is for three years and Boeing has a massive backlog for that period. It is unlikely cutting a deal with workers would hurt its margins much. Delaying has almost certainly hurt its revenue and customer relations.

Boeing executives have helped take the firm's stock down 35% in the last month. Even with the market turmoil, the Dow is only off 25%. Management is responsible for that significant difference.

Douglas A. McIntyre is an editor at 247wallst.com

Morgan Stanley (NYSE:MS) waited too long to take new money. If should have gotten the capital long ago the way Goldman Sachs (NYSE:GS) did with Warren Buffett.

But, John Mack, the MS CEO, thought he might go it alone or get better terms, By waiting, he damaged his shareholders more than he could imagine. And, it may get worse.

The good news is that, according to The New York Times, the $9 billion coming from Mitsubishi UFJ will be protected by the federal government. That means the deal is likely to close.

The very bad news is that, according to the FT, "Under the new terms being discussed, the entire $9bn would be in the form of convertible preferred stock, that would eventually convert into common stock at a price that is expected to be between $20 and $25." Under the old terms, the conversion was at above $35.

The latest formula means that current shareholders face more dilution.

At the end of the day, the news has to be viewed in some positive light. MS will survive. But, the cost was awful. On September 8, Morgan traded at $43. No one can imagine that Mack did not know he had trouble then. It was only four weeks ago. He should have done a quick deal while he had the chance. By waiting, he let market fear, and probably some short selling, take his shares below $10.

Mack allowed Morgan to get into the trouble in the first place. He has been in upper level Wall St management for 30 years. He arrogance made him believe that he could get tremendous terms in bringing in new capital.

He was wrong on that account. But, his compensation will probably be fabulous next year.

Douglas A. McIntyre is an editor at 247wallst.com.