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US Stocks Plunge to New Lows Not Seen Since 2002

Economic gloom deepened Thursday in the United States as stock prices fell to five-and-a-half-year lows and Congress delayed until next month action to assist hard-pressed U.S. automakers. VOA's Barry Wood has more.

The closely watched Standard and Poors 500 index fell to an 11-year low, taking that index back to pre-technology bubble levels. The Dow Jones Industrials fell another 444 points to 7,552, its lowest level since 2003.

"Once the market takes out its 2002 lows, which the S&P just did, and I think the Dow is around 7,200, then I think you can look for the blow-off bottom and perhaps an end to the selling, or at least an intermediate term bottom," said Tim Mulholland, a futures trader in Chicago, said on Bloomberg Television.

Citigroup, until recently the biggest U.S. bank, continued its fall and has now lost nearly 50 percent of its value in just the past two days.

Congress Thursday turned aside the pleas of industrial state lawmakers from both parties and postponed until the week of December 8 any vote on granting emergency loans to U.S.-based car companies. The Detroit three say the credit squeeze and sharp falloff in consumer demand has left them so short of cash that they face possible bankruptcy.

Lee Hoskins, the former governor of the Reserve Bank of Cleveland, Ohio, told Bloomberg News that he opposes aid to the car companies unless tight conditions are attached.

"If Congress is foolish enough to do this, then I think they should demand a lot from both the labor unions and the companies themselves, including changing the management, if they want," he said.

Gold gained $13 on the day to $749 an ounce and oil lost another $4 to under $50 a barrel. Oil prices are now down about 60 percent from their record highs set in mid-July.