STOCK MARKET WATCH, Thursday March 15

Don't Hold Your Breath!
BY CHRIS PUPLAVA

Economic growth over time can be compared to breathing, with periods of inhaling (growth), and exhaling (contraction). The process of inhaling brings oxygen into the lungs which is then carried throughout the body to cells for use in generating energy (ATP) through metabolic processes. Exhaling is the expelling of carbon dioxide, a waste product that is harmful to the body unless expelled. The agent bringing oxygen to the cells and removing carbon dioxide is hemoglobin.

Likewise, liquidity is the oxygen that helps bring energy to the economy by stimulating growth, and the carrier of liquidity to and from the economy is predominantly the Federal Reserve through its control of short-term interest rates, through its open market actions, and its control of bank reserves.

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The process of exhaling (contraction) in the economy typically leads to a recession, with very few examples of a soft landing (mid-cycle slowdown), where the economy doesn’t fully exhale but takes another breath and continues expanding. The question then is whether or not we will enter into a recession as liquidity dries up from the economic punchbowl (credit), or whether we will inhale (reflate) once more and undergo a mid-cycle slowdown.

As stated before, the Fed is a major determinant of liquidity and whether the punchbowl (credit) is removed from the economic system or refilled. Looking at the current situation points to an acceleration of a removal of liquidity from the economy as evidenced by bank lending standards tightening, the liquidity of the U.S. consumer (their balance sheets) worsening, and further weakness in the overall economy.

http://www.financialsense.com/Market/wrapup.htm

8:30 AM PPI Feb
Briefing Forecast 0.4%
Market Expects 0.5%
Prior -0.6%

8:30 AM Core PPI Feb
Briefing Forecast 0.2%
Market Expects 0.2%
Prior 0.2%

8:30 AM Initial Claims 03/10
Briefing Forecast 330K
Market Expects 325K
Prior 328K

8:30 AM NY Empire State Index Mar
Briefing Forecast 15.0
Market Expects 17.0
Prior 24.4

9:00 AM Net Foreign Purchases Jan
Briefing Forecast -
Market Expects $60.0B
Prior $15.6B

12:00 PM Philadelphia Fed Mar
Briefing Forecast 5.0
Market Expects 3.5
Prior 0.6

http://biz.yahoo.com/c/e.html

04. U.S. March Empire State prices paid 30.2 vs 26.9 in Feb
8:30 AM ET, Mar 15, 2007 - 1 minute ago

05. U.S. insured unemployment rate rises to 2.0% vs. 1.9%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

06. U.S. March Empire State employment index 11.4 vs 12.7 in Feb
8:30 AM ET, Mar 15, 2007 - 1 minute ago

07. U.S. continuing jobless claims at 13-month high 2.56mln
8:30 AM ET, Mar 15, 2007 - 1 minute ago

08. U.S. March Empire State new orders index 3.1 vs 18.9 in Feb
8:30 AM ET, Mar 15, 2007 - 1 minute ago

09. U.S. 4-wk avg. initial claims fall 10,250 to 329,250
8:30 AM ET, Mar 15, 2007 - 1 minute ago

10. U.S. March Empire State index lowest since May 2005
8:30 AM ET, Mar 15, 2007 - 1 minute ago

11. U.S. initial jobless claims fall 12,000 to 318,000
8:30 AM ET, Mar 15, 2007 - 1 minute ago

12. U.S. March Empire State index well below consensus 19.0
8:30 AM ET, Mar 15, 2007 - 1 minute ago

13. U.S. Feb. PPI light truck prices up 1.7%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

14. U.S. March Empire State index 1.9 vs 24.4 in Feb.
8:30 AM ET, Mar 15, 2007 - 1 minute ago

15. U.S. Feb. PPI capital equipment prices up 0.3%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

16. U.S. Feb. PPI foods prices up 1.9%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

17. U.S. Feb. PPI energy prices up 3.5%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

18. U.S. Feb. intermediate core PPI up 0.2%
8:30 AM ET, Mar 15, 2007 - 1 minute ago

19. U.S. Feb. core PPI up 0.4% vs. 0.2% expected
8:30 AM ET, Mar 15, 2007 - 1 minute ago

20. U.S. Feb. PPI up 1.3% vs. 0.6% expected
8:30 AM ET, Mar 15, 2007 - 1 minute ago

now. It's been 8-10% for a while now.

CNBC actually discussing the inflation/Empire State numbers as having an effect on the Europe and dollar rallies that were going on and have now downturned.

These numbers only appear to be bad news. In reality they are very good news. I'm not yet sure why they are good but I'm going to watch some CNBC in a while and I know they will explain it all to me. I'm so grateful they are always there to show me how bad news is always cleverly disguised good news.

;-) :toast:

Enjoy today's roller-coaster Marketeers!

Julie

Good mornin' Julie! :hi:

The market agress with you!

Wheee!!! We're in the Money!

http://www.reuters.com/articlePrint?articleId=USN1539862320070315

NEW YORK, March 15 (Reuters) - International investors bought a net of $97.4 billion in long-term U.S. securities in January, the Treasury Department said on Thursday, reflecting renewed foreign demand for U.S. assets.

Demand for long-maturity securities such as equities, notes and bonds rebounded sharply from December, when the United States reported a net inflow of $14.3 billion.

<snip>

The January data, though, do predate the ongoing crunch in the U.S. subprime mortgage market, which some analysts expect to dent future foreign demand for U.S. securities.

Including short-term securities such as Treasury bills, foreigners bought a net $74.6 billion in January, enough to cover that month's $59.1 billion U.S. trade deficit.

That was also a sharp rebound from December, when foreigners sold a net $14.7 billion.

...more...

SINGAPORE - Oil prices gained Thursday on figures showing that supplies of U.S. gasoline and other refined products fell in the most recent week, and ahead of an
OPEC meeting later in the day.

The market also got a lift from Wall Street's recovery from its plunge Tuesday that stirred concerns about the U.S. economy's health and future demand for energy.

Traders expect ministers from Organization of Petroleum Exporting Countries to keep their output targets steady when they meet in Vienna, Austria, later Thursday. Some analysts have pointed out that maintaining current OPEC quotas could leave the market with a surplus in the second quarter, which could hurt prices.

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Wednesday's weekly petroleum inventories report from the U.S. show that crude oil stocks rose less than expected from the previous week. The Energy Department said crude inventories rose last week to 325.3 million barrels, up by 1.1 million barrels. Analysts surveyed by Dow Jones Newswires expected a bigger gain of 1.4 million barrels.

http://news.yahoo.com/s/ap/oil_prices

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070315:MTFH73043_2007-03-15_07-26-05_SP6157&type=comktNews&rpc=44

SINGAPORE, March 15 (Reuters) - Shanghai copper prices rallied 1.4 percent on Thursday, supported by resilience in London futures despite turbulent equity markets.

The most active May contract <SCFK7> on the Shanghai Futures Exchange was 830 yuan, or 1.43 percent higher, at 58,970 yuan ($7,618) a tonne at the close, encouraged by gains in London futures despite turmoil in equities.

"Shanghai copper will move smoothly following London. I do not see any rapid fluctuations in the near future," said analyst Pang Ying at Minmetals Star Futures.

Spot copper in Shanghai was up 925 yuan to between 58,500 and 58,650 yuan.

London Metal Exchange copper for three-month delivery <MCU3> was up almost 1 percent at $6,280 a tonne at 0701 GMT, from the previous close of $6,220.

"Base metals are proving resilient, markedly more so than when equities fell two weeks ago," said Peter Richardson, Deutsche Bank's chief metals economist.

/...

http://www.bloomberg.com/apps/news?pid=20601012&sid=aQdJaDZ5btsk&refer=commodities

March 15 (Bloomberg) -- Nickel rose to a record and copper jumped the most in three weeks in London after China, the world's largest consumer of the metals, expanded industrial production at a faster-than-expected rate.

Output increased 18.5 percent in January and February, the National Bureau of Statistics said today. That beat the 15 percent median estimate of 20 economists surveyed by Bloomberg News and is the fastest pace in eight months.

Industrial expansion directly correlates with metals consumption, said Michael Lewis, head of commodities research at Deutsche Bank AG. ``This suggests that China's underlying demand for metals is strong,'' Lewis said by telephone from London.

Nickel for delivery in three months on the LME jumped $2,800, or 6.3 percent, to $47,600 a metric ton as of 3:42 p.m. in London. Earlier, the contract traded at $47,890, beating yesterday's record by $2,890. Copper gained as much as $320.75, or 5.2 percent, to $6,540.75 a ton, its biggest intraday gain since Feb. 22.

Nickel has soared more than ninefold and copper has more than quadrupled in the past five years, driven by demand from China. The price rally has encouraged commodity producers including BHP Billiton Ltd., the world's largest miner, to boost output.

Deutsche Bank expects more gains for metals, especially copper, as China's economy continues to expand, Lewis said. ``The outlook is pretty good,'' he said.

/...

WASHINGTON - The deficit in the broadest measure of trade hit an all-time high in 2006 and for the first time the United States even ran a deficit on investment income.

The Commerce Department reported that the imbalance in the current account jumped by 8.2 percent to $856.7 billion, representing a record 6.5 percent of the total economy. It marked the fifth straight year the current account deficit set a record.

Investment flows turned negative by $7.3 billion from a surplus of $11.3 billion in 2005. It was the first time investment income has been negative on records going back to 1929. That means foreigners earned more on their U.S. holdings than Americans earned on their overseas investments.

http://news.yahoo.com/s/ap/economy

WASHINGTON (Reuters) - Ford Motor Co. (F.N: Quote, Profile , Research) Chief Executive Alan Mulally told Congress on Wednesday the company has a strong and realistic plan to turn around its troubled business.

Mulally said in written testimony for a U.S. House of Representatives Energy and Commerce subcommittee that Ford's business strategies must be flexible.

very short

A lawsuit filed by entertainment giant Viacom Inc., seeking more than $1 billion in damages against video-sharing website YouTube and its parent company Google Inc., raises the volume on one of the hottest debates in the technology business: Can Internet sites post snippets of content produced by others without paying them?

In the suit filed in federal court in the Southern District of New York yesterday, Viacom claimed that YouTube has displayed more than 160,000 unauthorized video clips from Viacom's stable of cable-television networks, including MTV, Comedy Central, and Nickelodeon, and that the clips -- some of which run for several minutes -- have been viewed over 1.5 billion times by YouTube visitors.

While the case is focused on the field of online video, it could have ramifications for old-line media seeking to protect their ownership of content and for any site that pulls content from other sources.

"For anybody who is in the business of adding value on the Internet, of helping people find things or bringing content together, this could affect their business," said Jonathan L. Zittrain , professor of Internet governance and regulation at Oxford University in England.

http://www.boston.com/business/technology/articles/2007/03/14/copyright_war_flares_with_suit_vs_youtube/

SAN JOSE, Calif. -- California's criminal case surrounding Hewlett-Packard Co.'s ill-fated boardroom spying scandal has all but evaporated, although the four defendants still aren't off the hook with federal prosecutors.

A judge dropped all charges Wednesday against former HP Chairwoman Patricia Dunn, while three other defendants avoided jail time by pleading no contest to misdemeanors.

But the U.S. attorney's office in San Francisco, which already has secured one conviction against a low-level investigator in the case, said it continues to investigate the boardroom spying scheme that rocked one of Silicon Valley's most respected companies. Spokesman Luke Macaulay declined further comment.

The sudden end to the state's high-profile case, however, may not bode well for federal prosecutors' probe, with some legal experts saying Wednesday's developments may indicate the evidence wasn't very strong.

http://www.washingtonpost.com/wp-dyn/content/article/2007/03/15/AR2007031500224.html

NEW YORK (CNNMoney.com) -- Volatility could be the word of the day Thursday on Wall Street, as investors coming off a topsy-turvy day that ended with gains look ahead to the expiration of options and futures contracts.

At 6:13 a.m. ET, Nasdaq and S&P futures were narrowly higher, with a comparison to fair value indicating a higher open.

Overseas, major stock indexes all closed higher in Asia, as stocks followed the rebound on Wall Street Wednesday. Major indexes were also higher in Europe in early trading.

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Investors will also be looking the so-called quadruple witching day Friday, when a full range of options expire. The day before those options expire can often be a volatile day in the market, especially during a period of wide swings in stocks as has occurred recently.

http://money.cnn.com/2007/03/15/markets/stockswatch/index.htm?postversion=2007031506

http://www.ft.com/cms/s/0c57794e-d2ca-11db-829f-000b5df10621.html
By Reuters March 15 07:25:11 GMT

China’s industrial production growth surged at the start of the year, reinforcing expectations that Beijing will soon tighten policy afresh to prevent the world’s fourth-largest economy from overheating.

Factory output in January and February combined grew 18.5 percent from a year earlier, the National Bureau of Statistics said on Thursday.

That dwarfed the median forecast of economists polled by Reuters for a rise of 15.5 percent rise. It was also much faster than December’s 14.7 percent growth rate and the increase of 16.2 percent logged in the first two months of 2006.

The output figures chimed with other strong data releases this week showing that bank lending and money growth powered ahead in February and that exports grew 50 percent last month from a year earlier.

”Robust industrial production growth suggests the economy has rebounded sharply from the policy-induced slowdown in the third quarter of 2006. If activity and loan provision growth continues to accelerate, we believe the risks for policy tightening will rise,” economists at Goldman Sachs told clients.

Output growth was last stronger in June 2006, when it was up 19.5 percent from a year earlier.

Output of transport equipment rose 26.1 percent in the first two months, ferrous metals 28.5 percent, chemicals 21.7 percent and textiles 17.8 percent.

Factories are humming not only because of booming exports, but also because of lofty investment rates as China rushes to industrialise and urbanise.

/...

New data put heat on China to cool economy

BEIJING: Chinese industrial production surged at the start of the year, the government said Thursday, reinforcing expectations that Beijing will soon tighten its monetary policy again to keep the economy from overheating.

Factory output in January and February combined grew 18.5 percent from a year earlier, blowing past market forecasts of a 15.5 percent gain.

The increase, the biggest since June, also outpaced the 14.7 percent growth rate in December and the 16.2 percent rise in the first two months of 2006.

The output figures chimed with releases this week showing that bank lending and money growth powered ahead in February and that exports jumped 50 percent last month from a year earlier.

"Robust industrial production growth suggests the economy has rebounded sharply from the policy-induced slowdown in the third quarter of 2006," economists at Goldman Sachs told clients. "If activity and loan provision growth continues to accelerate, we believe the risks for policy tightening will rise."

Sun Mingchun, an economist at Lehman Brothers in Hong Kong, agreed.

"Combined with stronger-than-expected data released earlier this week," Sun said in a report, "we see heightened policy risk and expect the government to introduce a slew of tightening measures soon, including trade policies to curb export growth; monetary policies to mop up excess liquidity and cool down bank loan growth; and even administrative measures to slow investment and production growth."

A newspaper run by the central bank fanned the talk of tightening policy with a front-page editorial.

"In order to avoid a rebound in fixed- asset investment and to reduce potential risks in the financial system, the central bank might need to introduce further tightening measures to mop up liquidity and contain credit expansion," The Financial News said.

/...

http://www.ft.com/cms/s/4a93ad38-d2a0-11db-a7c0-000b5df10621.html

Asian stocks staged a broad recovery on Thursday, led by Tokyo, boosted by an overnight rebound in US stocks and a fallback in the yen.

Japan’s major indices had clawed back some of the losses of the previous day, when the Tokyo market saw its second fastest fall this year. The Nikkei 225 ended the day up 1.1 per cent to 16,860.39. The broader Topix also rose 1.1 per cent to 1,694.18.

The fall in the yen against a broad range of currencies boosted export stocks. By late afternoon the yen was trading at Y117.1 to the dollar.

Among export-focused sectors, machinery was up 2.5 per cent, with auto 1.4 per cent higher. Canon, the printer and camera maker that derives the bulk of its revenue from overseas sales, was up 1.1 per cent to Y6,210.

Mitsubishi Heavy soared 9.2 per cent to Y716 after winning an order to build two nuclear reactors for TXU, the US power plant operator – Mitsubishi Heavy’s first deal involving a foreign reactor.

Matsuzakaya, the department store chain, was untraded with a glut of buy orders at Y1,030, 10.8 per cent above Wednesday’s closing price, after fellow store chain Daimaru announced an acquisition that valued Matsuzakaya share at Y1,052. Daimaru, whose shares are valued at Y1,473 according to the terms of the deal, fell 1.4 per cent to Y1,526.

Chubu Electric Power jumped 3.8 per cent to Y4,150 after a report in the local Nikkei newspaper that The Children’s Investment Fund had acquired a stake and asked for higher dividends and share buybacks. The hedge fund is applying a similar strategy to electricity wholesaler J-Power, whose share price has risen considerably.

Other electric utilities also rose strongly, with Tokyo Electric Power, the biggest listed power company in the world, 1.5 per cent higher at Y4,090. Electric utilities in Japan are ripe targets for shareholder activism because they are cash-rich - providing plenty of opportunities for rewarding shareholders. Although their dividend pay-outs have increased recently, they are still low by the standards of foreign utility companies.

/...

http://asia.news.yahoo.com/070315/kyodo/d8nsfuc81.html

(Kyodo) _ Nonresident investors remained net sellers for the second consecutive week at the Tokyo, Osaka and Nagoya bourses, the Tokyo Stock Exchange said Thursday.

Nonresident investors sold a net 390.04 billion yen worth of stocks from March 5 to 9, up from 264.97 billion yen the preceding week.

Individual investors remained net stock buyers for the second straight week, purchasing a net 590.26 billion yen worth, up from the preceding week's net buying of 508.66 billion yen.

The net purchasing figure was the biggest since the third week of October 1987, when the Oct. 19 Black Monday crash took place.

/...

http://business.guardian.co.uk/story/0,,2034158,00.html

· Dow falls below 12000 for first time in five months
· Banks hit amid fears over exposure to credit risks

Ashley Seager and Jill Treanor
Thursday March 15, 2007
The Guardian

The world's markets suffered another day of turbulence and heavy losses yesterday as analysts and investors fretted that the crisis engulfing US "sub-prime" mortgages could finally tip the world's largest economy into recession.

<meaty snip...>

After trading in Barclays shares stopped, New Century Financial said the UK bank had called in a $900m (£465m) loan. The move may push New Century, whose shares are suspended by the New York Stock Exchange, closer to bankruptcy.

Britain does not have a sub-prime market as well defined as the US but several lenders offer loans to customers with poor credit history. US investment banks, which created the sub-prime market in the US, are also entering Britain. Lehman Brothers, which reported record first-quarter figures yesterday, which it admitted were hit by the problems in the US mortgage market, offers deals to customers with poor credit through Alliance & Leicester.

Lehman said a strong performance in its credit products and property business was "partially offset by declines in securitised products due to weakness in the US residential mortgage sector".

/...

So, hello? what did the Lehman Bros. quarterly report declare, entirely, exactly?

http://www.usatoday.com/money/industries/banking/2007-03-15-subprime-econ-usat_N.htm

WASHINGTON — The subprime mortgage meltdown, while dramatic, isn't likely to push the U.S. economy into recession.
Still, bankruptcies at dozens of lenders and rising default rates among borrowers could reduce growth, hurt home prices, crimp consumer spending and affect the financial fortunes of millions, from first-time home buyers to timber workers, truckers and lenders.

BIG BANKERS OK: Subprime is small part of Lehman, others.

Problems at subprime lenders, which make higher-cost loans to consumers with impaired credit, may also have longer-term impacts. Because African-Americans and Hispanics are more likely to take out subprime loans, they could experience higher defaults, exacerbating the wealth gap between minorities and whites.

Emerging problems in the subprime sector — faulty accounting, sloppy or non-existent loan underwriting — are also adding urgency to congressional efforts to tighten mortgage lending, which would further affect credit availability.

FIND MORE STORIES IN: US economy | Mark Zandi | Subprime
"It's going to weaken the housing market. It now threatens consumer spending through the wealth effect" as homeowners are less able to tap into equity, says Mark Zandi, chief economist of Moody's Economy.com.

Zandi has cut his forecast for 2007 growth, while increasing his recession-risk odds to 1-in-4 from 1-in-5. Subprime troubles could mean median home prices will dip about 5% this year, rather than his earlier 3% prediction. "This has a measurable impact. It stretches the rubber band. I don't think the rubber band breaks," he says.


more....sort of a montage of articles tossed together

http://www.latimes.com/business/la-fi-wrap15.2mar15,1,6517836.story?coll=la-headlines-business

Senate Banking Committee Chairman Christopher J. Dodd said Wednesday that regulators bear some responsibility for problems in the sub-prime mortgage sector and that he plans to call them before the committee for questioning.

"That's what's made me angry here — that the regulators apparently have not been doing as good a job as I think they should have been doing," Dodd (D-Conn.) told reporters after speaking at a U.S. Chamber of Commerce conference on market competitiveness. He said regulators should help explain "how we got to this point."

Dodd, a presidential candidate from a state with many hedge funds and insurers, has not set a hearing date.

Also Wednesday, Housing and Urban Development Secretary Alphonso Jackson called on Fannie Mae, Freddie Mac and private banks to support forbearance to sub-prime mortgage borrowers who are having trouble making their payments.

more...

http://www.321gold.com/editorials/schiff/schiff031507.html

snip>

Of course, the vast majority of home loans in the last few years, sub-prime or otherwise, should never have been made in the first place. However, when real estate prices were rising, no one cared about the wildly optimistic assumptions or the out-and-out fraud inherent in the loan process. Everyone was making money. Borrowers, regardless of their ability to pay off their loans, thought they were getting rich as real estate prices rose. On the other side, home builders, real estate agents, appraisers, mortgage brokers, mortgage originators, Wall Street brokerages that securitized the loans and the hedge fund clients who bought them, were all getting rich as a result of booming credit. For the charade to continue, borrowers pretended they could pay and lenders pretended that they would be paid.

The fix now being suggested by some members of the U.S. Congress demonstrates how Washington completely misunderstands market dynamics. Their legislative proposals will require that lenders make potential borrowers verify their incomes and restrict credit only to those who can afford the payments after the teaser periods end. Washington fails to grasp that a return to traditional lending standards would precipitate a return to traditional prices, which are way below current levels. There is just no way to crack down on lenders without causing a crash in the real estate market. However, continuing to look the other way is no panacea either as the real estate market is already in the process of collapsing under its own weight.

It is also typical and very disingenuous for lawmakers to feign outrage, or to have waited until a collapse occurs before taking action. Just like with the Internet bubble of the late 1990's, the government refused to act in advance of the crisis. Had the government taken preemptive action with regard to mortgage lending, the real estate bubble never would have been inflated to the degree that it has. However, a slower housing market would have resulted in a much weaker U.S. economy. More modest home valuations would not have allowed consumers to cash-out phony real estate wealth. Instead, home owners would have been forced to make higher mortgage payments and had even less money to spend on consumption. They might have actually considered saving some money for the future as their homes would not have been doing the "saving" for them.

In reality, the problem goes way beyond housing. Nearly every big ticket item that Americans consume is paid for with borrowed money, with foreign lenders supplying the credit. Without access to low cost credit, the spending stops. When the spending stops the service sector jobs associated with robust spending will disappear as well. Without paychecks, even those with low fixed-rate mortgages and high credit scores will not make their payments.

The bursting of the technology stock bubble of the 1990's was simply the opening act. What we are about to experience with the real estate bubble is the main event. In that respect, though it may be March of 2007 it sure feels a lot like March of 2000. However, instead of a mild recession, this collapse will be followed by the most severe recession since the Great Depression. The main risk is that Ben Bernanke and his buddies at the Fed panic, producing something far worse; a hyper-inflationary bust similar to the one experienced by the Weimar Republic in Germany. Let's hope that cooler heads prevail, but get your wheelbarrow ready just in case.

more...

In reality, the problem goes way beyond housing. Nearly every big ticket item that Americans consume is paid for with borrowed money, with foreign lenders supplying the credit. Without access to low cost credit, the spending stops. When the spending stops the service sector jobs associated with robust spending will disappear as well. Without paychecks, even those with low fixed-rate mortgages and high credit scores will not make their payments.

http://www.fallstreet.com/mar1407.php

Mortgage Bankers Association Chief Economist, Douglas Duncan, believes that mortgage activity is set to dip and that “there's no question that the decline in volume will reveal excess capacity”. Although Mr. Duncan isn’t painting on overly grim picture, it is worth pointing out that he offered this negative outlook more than 3-years ago…

Nearly Three Years of Insanity All But Over

As it would turn out, the so called ‘excess capacity’ in the mortgage industry wasn’t shed in 2004, it was simply utilized to push more ‘creative’ mortgages.

“While most home buyers still opt for traditional fixed-rate loans, lenders are planning to introduce an even wider array of niche mortgages as the refinancing boom wanes and competition intensifies.”
Creative Mortgages Fuel Home Sales — Banks Push Variety of New Loans to Offset Rising Costs; the Price of a Missed Payment.” Wall Street Journal, March 16, 2004.

As the ‘creations’ in question - including ‘interest only’ and ‘no doc’ loans – helped people who could otherwise not afford a house become homeowners, some people warned early and often that rapid home price appreciation and risky loans were a dangerous mix for the real estate market. However, these analysts, including Robert Shiller, Dean Baker, Paul Kasriel, and ‘The Economist’, were largely ignored for being overly pessimistic. That is, of course, until now.

As Housing Boom Turns To Bust Policy Makers Press PANIC

As the U.S. housing market enters its bust phase policy makers have been quick to reiterate that the damage will be contained. In fact, the response to some relatively small blow-ups in the subprime market has been so quick that you have to wonder if what policy makers are really saying is they will not allow the carnage to spread.

Poole: “The possibility of a liquidity upset or crisis is a financial disturbance that may have some policy implications for the Fed to provide some liquidity” Fed's Stern says no spillover from subprime

Following Poole’s suggestion of Fed help last week, Senate Banking Committee Chairman Christopher Dodd said yesterday that Congress “may need to do something much more quickly to provide some protection or you could end up with a lot of poverty and blight”. The astonishing point to be made about the bailout being talked about is that while Dodd is quoting research reports and talking about “losing 2.2 million homes”, the MBA “lists only 300,000 such borrowers as being in foreclosure now”. Dated numbers aside, doesn’t it seem odd that the bailouts and promises to defend ‘liquidity’ may be set to arrive with less than 25% of the anticipated subprime bust complete? What is really going on here?

more...

(Business 2.0 Magazine) -- If you walk into a Best Buy store this summer and see a tanned, rested sales-clerk clocking in or out of his shift on a whim, congratulations. You may have stumbled on a radical experiment: letting store employees work when they want.

You may also be looking at the future of your workforce, if Best Buy (Charts) has its way.

With a classic flextime structure, workers arrange their schedules with their boss in advance. But under a program called Rowe, for "results-only work environment," the boss has no say in scheduling and can judge employees only on tasks successfully completed - even if none were done in the office. The five-year-old plan now covers 60 percent of the employees at Best Buy's corporate headquarters near Minneapolis.

And by all accounts, it's working. Employee productivity has increased an average of 35 percent in departments covered by the program. Rowe "has forced managers and employees to be really clear about what needs to be accomplished," says spokes-woman Dawn Bryant.

http://money.cnn.com/magazines/business2/business2_archive/2007/03/01/8401022/index.htm?postversion=2007031506

Dave Colson, a spare man with a well-trimmed folksinger's beard and a dusty seed-catalog cap, doesn't seem like a talkative sort. But Colson, 50, and wife Chris, 55, are full of questions today. For more than 20 years the couple has been coaxing organic micro-crops - tomatoes, squash and herbs - out of the nine cultivated acres of glacial soil that make up a portion of their New Leaf Farm in Durham, Maine, and todayis their first meeting with Susan Phinney.


As Whole Foods' first full-time "forager," Phinney, 46, is tasked with finding and then helping small farmers, bakers and other food providers cope with the exacting demands of the huge organic grocery chain. She voices an uplifting corporate mantra: "We think your products are great, and I'm here to see whether we can build a business together." Whole Foods, with annual sales of $5.6 billion, is about to open its first market in Maine. The new store should be a natural outlet for the Colsons. But they wonder whether they can sell their produce to a big supermarket without sacrificing their souls - and their bottom line.

http://money.cnn.com/galleries/2007/fsb/0703/gallery.whole_foods.fsb/index.html

:donut: :donut: :donut:

Mind the store for me will you? I'm checking out for awhile. Back around noon-ish.

Ozy :hi:

:)


Well, it is for me. I'm about to head east an hour or so and catch my Cards playing in Lexington.


C-A-R-D-S!
C-A-R-D-S!

Go! Cards! Go!


:woohoo:

:donut: :donut: :donut:

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

Last trade 83.74 Change +0.10 (+0.12%)

Wild Day For Dow, Dollar Closing Mixed

Wild Day For Dow, Dollar Closing Mixed

Dollar- A crazy day in the markets for any trader, as the US dollar looks to end mixed against most of the majors in New York. Notably during the session, the Dow Jones Industrial Average traded below the 12,000 level, causing some panic as the benchmark fluctuated wildly during the morning hours and didn’t find footing till the afternoon. But through all of the volatility, the greenback gained slightly against a handful of majors on the session supported by a narrower than expected current account deficit. Released in the New York morning, the current account shrunk to $195.8 billion compared to estimates of a $204 billion shortfall in the fourth quarter. The improvements were attributed, for the most part, to lower crude oil imports and larger amounts of investment income paid to US investors. Foreign investors, on the other hand made less in US investments, with the US government paying approximately $2.5 billion less in interest payments to foreign entities and investors. Although the recent Commerce Department report does calm fears of infrastructure weakness, the potential continues to remains as the US needs to attract $2.1 billion a day to fund the current gap. The notion is especially threatening when considering the record gap in 2006. Last year, the current account shortfall swelled to $856.7 billion, the largest on record. The gap fell well short of the previous year’s $791.5 billion, equaling a whopping 6.5 percent of gross domestic product. Subsequently, today’s figure will play into tomorrow’s TIC data release in the morning. Although producer prices will be considered in tandem, the TIC will likely supports today’s findings, or counter them, turning the market dollar bearish. Comparatively, producer prices will help to ensure that the Federal Reserve will keep at the current stance of no-decision in the immediate future.

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Dollar Struggles To Find Traction On Improved Current Account Numbers

http://www.dailyfx.com/story/currency/eur_news/Dollar_Struggles_To_Find_Traction_1173895094970.html

The market had already shown its desire to sell dollars when economic data has come across the wires worse than expected as well as when it comes in line. Now, after a considerable improvement in the current account balance, traders have shown they are willing to unload the world’s most liquid currency even when the news is good.

From price action, the majors made considerable intraday breaks against the greenback. After leveling off on a 1.3180 low for the previous 24 hours, EURUSD rallied to test the previous swing high with a temporary top around 1.3045. The USDCHF showed a modest dollar bid in the European hours, but this turned into a 100-point drop that pulled the pair through 1.2140 support to a more secure floor seen at 1.21. Volatility returned to GBPUSD when a 35-point consolidation band above 1.9220 turned into a 150 point rally to 1.9370. Finally, the Japanese yen was having difficulty capitalizing on the fresh dollar drop after USDJPY turned on 115.75 before picking up 100-points on a retracement.

Though price action hardly reflected it, the economic calendar was, on balance, supporting the dollar bulls. The biggest single piece of data to hit the wires Wednesday morning in the New York session was the Commerce Department’s measurement of the fourth quarter current account balance. Before the release, the trade imbalance was already a hot button issue. Now, with the final quarterly number in place and the indicator reporting a fresh record deficit for the year, politicians and policy makers have the numbers needed to rejuvenate their discontent in Washington DC and at trade summits with China. On the other hand, though the $856.7 billion shortfall for the year marks a discouraging trend, the quarterly change spurred speculation that the bottom has come and gone with a much better than expected number. According to the government’s number, the deficit shrank from $229.4 billion in the three months through September to $195.8 billion – the slightest shortfall since the third quarter of 2005. Further diving into the component data, the goods and services, income and unilateral transfer balances all improved. The most influential change though came from the physical trade group, which improved $33.6 billion with the help of cheaper energy imports.

Elsewhere, the import price index provoked mixed sentiment among trades. On the one hand, the inflation gauge reported heightened pressures over January’s numbers. On the other, the pickup was less than what the market had expected. Getting a true sense of the numbers, the 0.2 percent pickup on the monthly measurement and the acceleration to a 1.3 percent pace year-over-year are still well off the numbers seen only six months ago. Back when the Federal Reserve was still hiking borrowing rates, the annual import price gauge always held above a 4 percent gait and had frequently topped twice that. Therefore, comparing these two, very different periods shows why so many economists believe it there is little chance the central bank will consider further tightening any time this year. Ultimately, however, the import index does not have the final say in the world of economic indicators on policy decisions – the consumer price gauge due on Friday has that distinct honor. Tomorrow, traders will absorb the factory inflation numbers to establish their final consensus for the end of the week CPI read.

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http://asia.news.yahoo.com/070315/kyodo/d8nsfud80.html

(Kyodo) _ The price of the benchmark 10-year Japanese government bond dropped Thursday in the wake of recovery in equity markets around the world.

In interdealer trading, the yield on the No. 285, 1.7 percent issue rose 0.020 percentage point from Wednesday's close to 1.585 percent.

The price of the June futures contract for 10-year bonds fell 0.14 point to 134.73 on the Tokyo Stock Exchange, with the yield up 0.012 percentage point to 1.875 percent.

/..

Pssst: Anybody wanna buy some'a dees nice govt. bonds right here unner'a my raincoat? Today's special price.

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070315:MTFH75813_2007-03-15_09-26-16_T161948&type=comktNews&rpc=44
Thu Mar 15, 2007 5:26am ET

TOKYO, March 15 (Reuters) - The Bank of Japan is likely to take a more cautious view on consumption in its twice-yearly outlook report due out next month as wage conditions are not improving significantly to boost spending as previously hoped.

The central bank is expected to say in its report on the economy and prices that the robust corporate sector will continue to lead the current economic recovery while consumption will fluctuate between rises and declines.

The BOJ said in its outlook report issued in April last year that household spending was expected to become a main driving force in domestic private demand as the strength in the corporate sector filtered through to households.

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http://investing.reuters.co.uk/news/articleinvesting.aspx?type=ukPoundRpt&storyID=2007-03-15T084631Z_01_L1531809_RTRIDST_0_MARKETS-STERLING-OPEN.XML
Thu Mar 15, 2007 8:46 AM GMT

LONDON, March 15 (Reuters) - Sterling slipped against the dollar on Thursday, near to the previous day's eight-month low versus the euro as investors trimmed exposure to high-yielding currencies like the pound.

Major currencies have stabilised after a recent sell-off in high-return assets as stocks rebounded and investors paused to assess the climate for risk.

Sterling was still suffering a mild bout of unwinding of carry trades, where investors had borrowed in low interest rates currencies like the yen to invest in high-yielding units.

The British currency had been one of the biggest beneficiaries of carry trades with its interest rates at 5.25 percent. "Cable has come off a top. Sterling has not benefited from a rally in equity markets," said Adam Cole, currency strategist at RBC Capital Markets. "Sterling is driven by this global environment of what's happening to carry trades."

By 0840 GMT, sterling was down 0.2 percent at $1.9313 <GBP=>, while it was steady on the day at 68.37 pence per euro <EURGBP=>.

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http://www.nasdaq.com/aspxcontent/NewsStory.aspx?cpath=20070315\ACQRTT200703151210RTTRADERUSEQUITY_1004.htm
&selected=9999&selecteddisplaysymbol=9999&StoryTargetFrame=_top
&mkt=WORLD&chk=unchecked&lang=&link=&headlinereturnpage=http://www.international.nasd

(RTTNews) - Buyers returned to the fixed income market during the middle of Thursday's trading but ticked back up with the release of the Philadelphia Fed Survey. The move sent yields back to the flat line, reversing some of the earlier gains. The bond market has been stabilizing over the last two days after a buying spree dominated the first two days of the week. Monthly PPI data had a large effect on early trading when it came in worse than economists had expected.

The 10-year yield opened higher at the start of Thursday's session and kept higher for most of the morning. Yield levels began to dip in the late morning, falling back toward the flat line. However, with the release of weaker than expected Philadelphia Fed Survey bringing sellers back into the market.

By noon in Chicago, the 10-year yield was up 2 basis points at 4.542%. On Tuesday, the yield closed below 4.5% at a multi-month low. Meanwhile, the 5-year yield was up 2.7 basis points at 4.460%. The 30-year yield remained little changed, however, rising less than a basis point to 4.701%.

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http://asia.news.yahoo.com/070315/kyodo/d8nsgh5o0.html

(Kyodo) _ The U.S. dollar firmed in the lower 117 yen level Thursday in Tokyo as a rebound in U.S. shares soothed some concerns about the U.S. economic outlook.

At 5 p.m., the dollar was traded at 117.25-28 yen, up from Wednesday's 5 p.m. quotes of 117.03-13 yen in New York and 116.03-06 yen in Tokyo.

It moved between 117.03 yen and 117.58 yen during the day, trading most frequently at 117.20 yen.

The euro showed firmness against the yen and hovered around the 155 yen line. At 5 p.m., the single European currency traded at 154.94-98 yen and $1.3212-3215, compared with Wednesday's 5 p.m. quotes of 154.78-88 yen and $1.3218-3228 in New York and 153.13-17 yen and $1.3195-3198 in Tokyo.

The dollar inherited strength from New York trading overnight as worries over the U.S. economic outlook showed signs of easing after a key U.S. stock gauge, the Dow Jones Industrial Average, rebounded Wednesday after marking its second steepest loss this year Tuesday.

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http://www.ft.com/cms/s/41fb01de-d21f-11db-a7c0-000b5df10621.html

The dollar fell on Wednesday as US equities continued to slide on concerns that problems in the US subprime mortgage market could spill over to the wider economy.

But unlike Tuesday, which saw the dollar’s fall limited to a sharp drop against the low-yielding yen, the US unit lost ground against European currencies on Wednesday.

snip>

“There are signs that dollar is at the start of a broad-based decline that reflects a downward re-assessment of the US economy,” said Paul Mackel, currency strategist at HSBC.

According to Mr Mackel, recent market focus on the effect of the unwinding of carry trades on the yen has masked the true story of dollar weakness.

Most analysts, however, believe the recent fall in dollar/yen has been sparked by a rise in risk aversion which has boosted the Japanese currency as investors unwind carry trades, in which the purchase of riskier high yielding assets is funded by selling the low-yielding yen.

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http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=6b2cb69a-b654-41f8-a2f7-d86e5f29ca73
Thu, Mar 15 2007, 13:41 GMT

NEW YORK -(Dow Jones)- Unable to find a clear direction from mixed U.S. data released early in New York, the dollar has slipped modestly Thursday but remains little changed on the day.

After starting the North American session up, the greenback lost ground on a mixed bag of U.S. data, including news that manufacturing activity in the New York region plunged in March.

In the wake of a monthly report from the Treasury International Capital system showing that net foreign purchase of U.S. securities rebounded sharply in January to hit its highest level in five months, the greenback had nearly retraced losses incurred in early morning New York trading.

However, the TIC report's effect was short-lived as the greenback reversed course once again, trading modestly lower against both the euro and the yen.

Early in New York, the dollar was changing hands at Y117.10 versus Y117.02 late Wednesday, while the euro stood at $1.3231 from $1.3222, according to EBS. The euro traded at Y154.96 versus Y154.63 late Wednesday. The dollar was at CHF1.2154 versus CHF1.2163, while sterling was at $1.9361 from $1.9350 late Wednesday.

The dollar's initial losses in New York had been moderated by a report showing that U.S. wholesale prices spiked higher in February, suggesting that despite recent signs of weak economic growth inflation is likely to remain the Fed's greatest concern. News that jobless claims fell by more than expected last week also helped offset downward dollar momentum.

(MORE TO FOLLOW) Dow Jones Newswires

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http://www.kitcocasey.com/displayArticle.php?id=1277

snip>

This year, I'll have to change that a bit and wonder if this will be the Ides of March for the Housing Market, with the subprime meltdown as Housing's Brutus... Ahhh, yes... Once a close friend of the Housing Market boom, but now the thing that brings it down... OK... I'm having fun with this in case you couldn't tell, so I'll stop now, and spare you the boredom with my little association here!

Currencies yesterday had an up and down day, as the euro traded as high as 1.3240, only to see it back off overnight... The Japanese yen, which had been on a two-day roll, was stopped in its tracks and reversed direction. But in the end, all the movement was really contained within a tight range.

The Current Account Deficit for the 4th QTR did narrow, coming in below $200 billion for the first time since the 3rd QTR of 2005... But when one looks at the drop in oil prices during the 4th QTR, you get a good idea why this deficit narrowed more than expected. But there's more... Think about the dollar here... Around Thanksgiving it hit the skids hard, and the damage to the dollar didn't end with the turkey and gravy... It went onto year-end... So... Doesn't this illustrate what I've been preaching for years and years now? If the dollar adjusts, the exports can outperform imports... And that's exactly what happened in the 4th QTR...

The dollar rallied briefly on this report, but soon turned back around and headed down on the day. You really have to wonder just what goes through a dollar bull's mind... He/she sees that the Current Account corrected a bit with the dollar weaker... And what do they do? They go out and buy dollars! DOLTS! Hello... McFly? Is anyone home?

Love that line! :rofl:

OK... I'll stop before I really get going there... There's news overnight that Thailand is going to remove a lot of the currency controls they put in place in December, and led to me losing a ton of hair! However, these moves by the Thai Gov. won't help us with regards to buying Thai baht going forward... So, the status remains the same... Besides, at this point, with a military gov't in place, I don't think I would touch Thai baht with a 10-foot pole! Once bitten, twice shy, babe!

Silver and gold continue to get caught up in the global volatility in stocks... There certainly seems to be a risk aversion trend going on which has been caused by the subprime meltdown... You know... Yesterday I saw an article that quoted some dudes saying that the subprime problems are being overblown... Hmmm... That's interesting... I guess they haven't done all their research of the facts... Here's one they should have researched... Housing accounted for 40% of the jobs created during the past 4 years (recovery)... Or how about this one... Mortgage Equity Withdrawal (MEW) accounted for over 2% of last year's GDP growth. So... I'm not suggesting that MEW's go away altogether... But with all the delinquencies (I reported on yesterday), and all the foreclosures, I don't see MEW's supporting the economy as they did in the past.

more...

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070315:MTFH72869_2007-03-15_07-17-57_L15529100&type=comktNews&rpc=44

PARIS, March 15 (Reuters) - The world's biggest car maker, Toyota of Japan, continued to increase sales in Europe in February in a declining overall market, the ACEA association of European car makers said on Thursday.

Toyota's figures contrast with a recently weak yen exchange rate against the euro, but other Japanese brands such as Nissan and Mazda saw their European sales decline sharply.

Total European car sales were down 2.5 percent to 1,083,811 passenger cars in February, and they slipped 0.3 percent over the first two months of 2007, against a year ago.

In the enlarged 27-member European Union, to which ACEA added new members Romania and Bulgaria for the first time in February, new car registrations were down 2.8 percent.

Toyota (7203.T: Quote, NEWS , Research) was the biggest gainer, up 13.1 percent in February and up 17.4 percent in the first two months of 2007 in the European Union and EFTA countries. Nissan (7201.T: Quote, NEWS , Research), Mazda (7261.T: Quote, NEWS , Research)and Renault (RENA.PA: Quote, Profile , Research) fell by more than 10 percent

ACEA said that apart from a 5.7 percent rise in Italy, the biggest EU markets suffered losses in February with a 15.1 percent drop in Germany due to a sales tax increase and a 3.2 percent decline in Britain ahead of the March plate change.

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http://www.dallasnews.com/sharedcontent/dws/bus/stories/031507dnbusdefensespending.3796dff.html

Local defense companies may not be able to rely on huge increases in military spending for much longer.

The amount of money awarded by the Defense Department to prime contractors has more than doubled since President Bush took office, from $144 billion in fiscal 2001 to $294 billion in fiscal 2006.

But last year's increase – 8.7 percent – was the smallest of Mr. Bush's administration.

Bill Hartung, director of the ArmsTrade Research Center at the World Policy Institute, released an analysis today of defense contracting trends.

"I think we're coming to the end of the boom," he said in an interview.

"The Iraq war will, I think, increasingly deal with nuts and bolts, not big-ticket weapons systems, and there's already some talk about reducing spending on things like the F-22 and Joint Strike Fighter to make room for spending on troop increases."

more....

(Edit to remove dupe of Ozy's post on the quadruple-witchy-thingy)

http://www.prudentbear.com/articles/show/1525

With the unraveling of the Yen carry trade, a sequence of events has been set in motion for a world liquidity crisis. Combining this with ongoing pressure from US sub prime deterioration will further harm confidence in US and consequently Asian stock markets.
As of this writing, Asian markets are again down 2 to 3%. I had written last week that confidence in financial markets were dealt a major blow in the first wave of Yen Carry unwinding a week or so ago in the article titled Damage Has Been Done.

This week, we are seeing the second phase of market declines, the US Dow down 230, and as I said Asian markets down 2 to 3% again. To say the least, market sentiment is getting crushed globally.

Now, combine this with still huge Yen carry overhang, and a seriously deteriorating US economy, and we will now see, and are seeing, the emergence of a world liquidity crisis.

I am going to discuss some of the components, there are many facets. But first, I want to say that, with market sentiment now so badly damaged, and the fundamental problems central banks will now have trying to re inflate financial markets – pushing on a string-
the central banks will ultimately fail re inflating financial markets. I do not believe they can either save market sentiment in 07, nor overcome consumer sentiment that is falling like a stone right after the stock crashes of the last weeks. In my judgment, we are possibly right at the cusp of a stock decline of the magnitude of the 1929 stock crash sometime this year.

Now, many people believe that markets will likely recover, that this present world stock decline is merely a correction. But, I view the market recoveries in the US and Asia last week as a dead cat bounce. I am fairly sure that we are going to see a great world stock crash that will make last years stock declines near this time of year look rather benign. The trouble is, this time, the US is now facing the necessity of lowering interest rates, and that will add further fuel to Yen carry unwinding. Many other factors also will just drain liquidity from financial markets, including housing and commercial real estate… and so on, there are many facets to this emerging liquidity crisis so lets get started...

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http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=2766735&mesg_id=2767155

:hi: :hug:

As long as I'm duping, here's an oldie but goodie - looks like they've finally run out of tricks.....

(Though it looks like Greenspunk is trying to keep 'em down, (it also pays) these days).

:donut:

http://www.kitco.com/ind/Willie/mar142007.html

snip>

GREENSPAN SIGNATURE

The current mess of mortgage defaults and foreclosures testifies to the venerable and highly acclaimed serial bubble inflation engineer Greenspan’s leadership and counsel as destructive in high order. Alan must be shuddering and cringing at the extreme damage to banking balance sheets, the spate of lending institution collapses, and the contagion within banks. He urged millions of US homeowners to rush into adjustable rate mortgages, so as to reduce their monthly costs. Here is an actual quote from Greenspan, extolling the virtues (vultures) of innovative mortgages. IT IS A SHOCKER, from a modern day John Law, who assisted in the transformation of the USEconomy into a giant hedge fund. Its foundation sits atop bubbles. Remember the two concepts Alan loves the most. That “innovation” is just another misleading term for broadened leverage to ramp a particular market. That “productivity” refers to more computing power for program stock & bond & derivatives trading (to earn fees), to displace workers (ending employer labor costs & fringe benefits) in the age of the great financial engineering miracle. Or is it a miraculous destruction? Would Sir Alan recall his words? Would he be proud of them? Methinks no and no. Why was he knighted by the Queen? Could it be because he helped bring down the US challenger to Old Europe? The lost US manufacturing base is a direct consequence of chronic inflation topped off by Greenspan policies. The housing bubble is one of Greenspan’s more direct accomplishments. Decide for yourself.

“Innovation has brought about a multitude of new products, such as subprime loans and niche credit programs for immigrants… With these advances in technology, lenders have taken advantage of credit scoring models and other techniques for efficiently extending credit to a broader spectrum of consumers… Where once more marginal applicants would simply have been denied credit, lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately. These improvements have led to rapid growth in subprime mortgage lending,… fostering constructive innovation that is both responsive to market demand and beneficial to consumers.” -- Alan Greenspan, April 2005

The reality is that innovation efficiently grew a dangerous reckless housing bubble, using the bizarre financial engineering alchemist tools to corruptly leverage the inflated (crowbar cranked as in amphetamines) construction into a monster which is now exploding, taking down everything tied to it. Credit scoring models were uniformly abused to grant loans to unqualified buyers who now are losing their homes and invested equity. Risk was systemically improperly priced. It fostered destructive innovation to cater to market demand in predatory fashion, to the detriment of consumers. What resulted was a temporary bailout from the 2000 stock bust with a Greenspan signature, followed by a greater housing bubble & bust with added Greenspan fingerprints, and a highly mysterious continued ongoing unjustified adulation admiration and worship of a knighted serial bubble engineer!!! He is celebrated much like the village drug dealer, only to escape criticism when the addict is down & out.

The current housing bubble & bust serves as vivid testimony of the failure and inability for free people to manage money and a monetary system, without the discipline and rigorous enforcement of a gold standard. When we run out of new available bubbles to puff, we will earn a new system, which is most likely to be less friendly and less gentle with liberties and freedom. Like now!

Greenspan was responsible for creating the mess, now he leads interference for reactive policy change. He has talked about a recession likelihood, but continues to deny a spillover of the housing debacle into the real economy. More accurately, he awaits the spillover. One should regard the Greenspan role as carefully orchestrated, not by any means accidental. He has created the psychological backdrop perfectly for Bernanke to cut official interest rates. Ben needed a shock to stocks, a change in sentiment and outlook. He got it.

more...

:)


I wonder if we'll get a hat trick today on that phrase....

http://www.theaustralian.news.com.au/story/0,20867,21389478-36375,00.html

DR Doom is back. Henry Kaufman, the legendary chief economist for Salomon Brothers in the 1970s and 1980s, earned his nickname for gloomy (and usually correct) forecasts of higher inflation and interest rates.
Mr Kaufman gave a speech in Wall Street on Tuesday night. The timing was perfect. US stocks had just sold off savagely, and Asian markets were about to suffer the same fate. Within hours the selling hit Europe, leaving indices sharply down.
He had no words of reassurance. But he did have a clear diagnosis. The problem lies in the changing definition of liquidity.

After the war, liquidity was an "asset-based concept" - companies' cash on hand and so on. Now, Kaufman said, "firms and households alike often blur the distinction between liquidity and credit availability. Money matters, but credit counts".

Securitisation and improved technology, he said, stimulated risk appetites, "fostering the attitude that credit usually is available at reasonable prices". But risk-management models assume "constancy in fundamentals", and do not account for the market's changing structure.

Moreover, risk modelling is so profitable that it will spread, and become "in a word, riskier" because aggressive models make the most money. Meanwhile "the reliance on judgment and reason will be pushed aside".

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I thought that was Marc Farber's nickname

http://www.smh.com.au/news/business/market-jumpy-blame-privateers/2007/03/15/1173722654110.html

THE recent volatility and pull-back in Asian markets have prompted some investors to sound a familiar refrain: It's all the fault of the hedge funds.

In the past two years, dozens of these funds have set up shop in Asia hoping to find relatively hidden lucrative opportunities, as markets in Europe and the US become more crowded and competitive. Their trading in equity markets has grown sharply: they were responsible for 22 per cent of the brokerage commissions paid on Asian cash equity trades in 2006, up from 5 per cent in 2004, Greenwich Associates says.

Many small traders and brokers in the region argue that the growing influence of hedge funds in Asia has exaggerated market movements, particularly the declines that rocked global markets recently. They also say the funds contribute to higher volatility in Asian equity markets.

Hedge funds are going to create even more unpredictable gyrations in the future, making things still more difficult for other investors, they say.

snip>

A focus on hedge funds does not tell the whole story, though, emerging market veterans say.

"The ferocity to which the market decline in China spilled over to the global markets is to some extent attributable to hedge funds," said Marc Faber, an investment adviser nicknamed Dr Doom for his bearish sentiments. "But today, it is not just the hedge funds that act like hedge funds - it is also the proprietary desks of banks like Goldman Sachs and Morgan Stanley."

Because the compensation of traders at these banks is based on short-term trading profits, "when the market goes down they all sell," Mr Faber said.

Wall Street investment banks have poured money and talent into proprietary trading desks in recent years, helping to earn record profits for their banks. Assets under management at these proprietary desks are difficult to quantify, but analysts at Keefe Bruyette & Woods estimate that these banks have more than doubled the amount of money in those businesses since 2001.

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http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=39156.222662037-891651786&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}
Last Update: 3/15/2007 5:20:38 AM EST

London equities recovered in opening trade on Thursday, as stronger Asian markets helped dispel the gloom and investors warmed to strong numbers from Prudential and Wm Morrison and confirmation that Cadbury Schweppes is looking at selling its US drinks business. Fresh takeover speculation in the tobacco sector also hepled settle the nerves of edgy investors. The FTSE 100 started the day 1.6 per cent higher, a rise of 93 points. Mid-caps were supported by a recovery amongst business services stocks and recovering investment companies. The FTSE 250 was 2.2 per cent higher at 11,181.9, a rise of 237 points. Wall Street and Asian indices recovered their poise overnight, as concern at slowing global growth prospects eased. The Dow Jones Industrial Average finished up 0.5 per cent at 12,133.4 whilst the Nikkei 225 made gains of 1.1 per cent to 16,890.4. London investors welcomed news that Cadbury Schweppes is to split its two operating businesses which could lead to a sale of the US drinks business. Analysts estimate the US drinks business which makes Dr Pepper and Seven-UP drinks is worth as much as £7bn. Shares were 5 per cent higher at 631p.

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http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=39156.3529976852-891662287&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}
Last Update: 3/15/2007 8:28:19 AM EST

The FTSE 100 surged on Thursday amid a sharp rally in global equities. Imperial Tobacco was the stand-out gainer as it confirmed it had made an approach for Altadis, the Spanish cigarette manufacturer. Strong overnight markets in Asia and a rally on Wall Street boosted sentiment and helped the FTSE 100 rise 110 points, 1.8 per cent, to 6,111.1. The blue-chip index was further boosted by strong numbers from Prudential and Wm Morrison and confirmation from Cadbury Schweppes that it was considering a sale of its US drinks division. However, the main story was the moves towards further consolidation in the tobacco sector as Imperial confirmed it had made a €45 a share offer for the maker of Gaulois cigarettes. The news came as newspaper reports that Imperial had approached Altadis led to the Spanish group’s shares being suspended on the Madrid stock exchange. Imperial shares were 7.4 per cent higher at £22.01 while BAT gained 3 per cent to £15.66. The mid-cap FTSE 250 rose 257 points, 2.4 per cent, to 11,201.1 by midday.

Sex And Drugs And Rock And Roll Tab by Ian Dury And The Blockheads, www.Ultimate-Guitar.Com


http://www.iandury.co.uk/

Sex and Drugs and Rock and Roll by Ian Dury and The Blockheads

Worked out by Matt Poole of England, England, using my excellent brain.

Main riff:

This occurs throughout the song - mainly when he's singing sexanddrugsandrockandroll

E-|---------------|---------------|---------------|------------|---------------|
B-|---------------|---------------|---------------|------------|---------------|
G-|---------------|---------------|---------------|------------|---------------|
D-|---------------|---------------|---------------|-----2------|---------------|
A-|--2--4--5--4---|--2--0---------|--2--4--5--4---|--2---------|--2--4--5--4---|
E-|---------------|--------3------|---------------|------------|---------------|

E-|---------------|---------------|--------
B-|---------------|---------------|--------
G-|---------------|---------------|--------
D-|---------------|---------------|-----5--
A-|--2--0---------|--2--4--5--4---|--2-----
E-|--------3------|---------------|--------

this bit leads into the verses

E-|---------------|--------
B-|---------------|--------
G-|---------------|--------
D-|---------------|--------
A-|--2--0---------|--------
E-|--------3--2---|--0-----

(these words go over the riff)
Sex and drugs and rock 'n' roll
Is all my brain and body need
Sex and drugs and rock 'n' roll
Is very good indeed

C#m Abm A B
Keep your silly ways or throw them out the window
C#m Abm A B
The wisdom of your ways I've been there and I know
C#m Abm A B
Lots of other ways, what a jolly bad show
D B A G
If all you ever do is business you don't like

play that riff again

Sex and drugs and rock 'n' roll
Sex and drugs and rock 'n' roll
Sex and drugs and rock 'n' roll
Is very good indeed

do the chords again for this verse
Ev'ry bit of clothing ought to make you pretty
You can cut the clothing, grey is such a pity
I should wear the clothing of Mr. Walter Mitty
See my tailor, he's called Simon
I know it's going to fit

vamp on a III pos Em chord over this bit

Here's a little bit of advice
You're quite welcome, it is free
Don't do nothin' that is cut-price
You know what they'll make you be
They will try their tricky devise
Trap you with the ordin'ry
Get your teeth into a small slice
The cake of liberty

verse chords over keys solo

then go berserk on the riff until the song finishes. Or longer, if you prefer.

Sex and drugs and rock 'n' roll
Sex and drugs and rock 'n' roll
Sex and drugs and rock 'n' roll
Sex and drugs and rock 'n' roll - ow! ow!
Sex and drugs and rock 'n' roll - ow! ow! ow! ow!
Sex and drugs and rock 'n' roll ....

Peace.

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-03-15T111706Z_01_L15320782_RTRIDST_0_MARKETS-EUROPE-STOCKS-UPDATE-2.XML
Thu Mar 15, 2007 11:17 AM GMT
By Lincoln Feast

LONDON, March 15 (Reuters) - European stocks followed U.S. and Asian markets higher on Thursday as fears eased of problems among U.S. home loan lenders spreading and as a rebound in commodity prices helped energy and mining shares.

Another bout of merger talk also lent support, with French IT services group Atos Origin (ATOS.PA: Quote, Profile , Research) spiking 22 percent before being suspended on reports it had received a takeover offer from investment funds Permira and Centaurus.

Imperial Tobacco (IMT.L: Quote, Profile , Research) jumped 7 percent after making a $15 billion bid approach for Spanish-French rival Altadis (ALT.MC: Quote, Profile , Research). Altadis shares were suspended. And Cadbury Schweppes (CBRY.L: Quote, Profile , Research) rose 4 percent after confirming plans to split its confectionery and drinks businesses, with analysts saying the move will make both units vulnerable to suitors.

By 1105 GMT, the FTSEurofirst 300 index <.FTEU3> of pan-European blue chips was 1.55 percent higher at 1,449.6 points, recouping more than half its losses from Wednesday when it hit its lowest level since December.

Many analysts saw the choppy trade continuing.

"Recent market volatility may well lay the foundations for attractive investment returns over the medium to longer term, but all the indications are that there could still be more weakness to come before we are done," said Michael Hughes, chief investment officer at Barings Asset Management.

"The typical extent of a correction during a bull market is 7 percent to 8 percent over a period of two to three months, and we have not experienced a decline of more than 10 percent in the equity markets since 2003." MORTGAGE WORRIES OVERSTATED? Continued...

/...

http://www.postfinance.ch/pf/content/en/topics/etrade/news/stockreportchmi.html

The Swiss blue chip benchmark traded comfortably in the black in midday deals on Thursday on a technical rebound and amid excellent signals from overseas.

At 11.27 a.m., the Swiss Market Index was 116.87 points or 1.36% higher at 8,694.53 with 24 gainers and one decliner. The broader Swiss Performance Index jumped 91.75 points or 1.34% to 6,944.96.

Financials recover from Wednesday's slump

Financials posted sharp gains in midday deals. Banking giant UBS jumped 2.3% to CHF 69.05 and Credit Suisse surged 2.5% to CHF 84.05. Julius Baer added 1.59% to CHF 153.50, helped by strong results from sector peer Bank Vontobel. However, traders warned of the damage the US subprime mortgage market will cause to the global economy, and that the worst might not be over yet.

Elsewhere among top performers, Syngenta surged 2.56% to CHF 220.40, Lonza moved 2.33% higher at CHF 109.90, Clariant soared 2.84% to CHF 19.95 and ABB climbed 2.54% to CHF 20.20.

Roche and Nestle underperform

Roche rose "only" 0.96% to CHF 210.50, clearly underperforming the market. Competitor Novartis added 1.03% to CHF 68.70 and food and beverag titan Nestle moved 0.65% higher at CHF 462.25. Swisscom was the SMI's only decliner, down 0.17% to CHF 428.75.

/...

5 States Tell Home Lender To Halt Business
Connecticut, Others Act Against New Century
March 15, 2007
From Wire And Staff Reports

Connecticut and four other states have issued cease-and-desist orders against
troubled New Century Financial Corp., alleging that some subsidiaries of the
troubled sub-prime mortgage lender have violated state laws.

Regulators from New York, New Hampshire, Massachusetts and New Jersey
sent notices to the Irvine, Calif.-based company on Tuesday, according to its
filing Wednesday with the Securities and Exchange Commission. Connecticut
regulators said they also issued a cease-and-desist order to the company
on Wednesday.

In their letters, the state regulators allege that New Century subsidiaries
have failed to fund mortgages that closed and did not notify the states
of their financial woes in a timely manner.

-snip-

http://www.courant.com/business/hc-newcentury0315.artmar15,0,5118922.story

http://www.usatoday.com/money/economy/employment/2007-03-14-relocate-usat_N.htm

The offer was too good to turn down. Just after selling his home and moving to a new place, Joe Cashen landed a marketing job with Nissan North America. The catch? He would have to sell his newly purchased home and move his wife and two young daughters from Los Angeles to Nashville.
Two years ago, amid the feverish housing market, such a relocation would have been simple.

But the real estate slowdown means there's no such thing as an easy move anymore: Slumping prices have put a sudden chill on employees' ability to relocate for a job and employers' ability to get new hires to move. Cashen's house languished on the market for more than three months, and he was eventually forced to take a $90,000 loss.

"I was incredibly anxious. I was supposed to move to Nashville, and the clock was ticking," says Cashen, 38, who sold his California home in 2006 after dropping the asking price three times. "It was quite a stressful time. We had to just get rid of it."

Gone are the days when companies could move employees and new hires around like puppets on strings. Now, the sluggish housing market is creating hassles for employers and employees struggling to move and to sell homes in what has quickly turned into a buyer's market.

snip>

Nudging workers

More employers are taking a variety of steps to nudge employees and new hires into relocating. About 20% of companies are now requiring employees who move for a job to use an approved real estate agent to better the odds of securing a home sale. And 15% are increasing the amount of time that relocating employees stay in temporary housing because of the extra time it takes to market and sell a home now, according to a survey by Prudential.

Other tactics include restrictions such as limiting the price an employee lists a home for and reviewing the amount of money that a company will reimburse an employee for any loss he or she takes when selling a home (known as a loss-on-sale program). Some will help new hires find rentals or pick up rental tabs.

more...

I couldn't believe that quote coming out of Chimperor's mouth!

Dow 12,156.64 23.24 (0.19%)
Nasdaq 2,379.50 7.76 (0.33%)
S&P 500 1,390.92 12.97 (0.94%)
10-yr Bond 4.5400% 0.0180
30-yr Bond 4.7010% 0.0070
NYSE Volume 428,474,000
Nasdaq Volume 227,453,000

10:00 am : The major averages continue to trade in split fashion as industry leadership remains mixed. Of the five sectors trading higher, Financials (+0.5%) is exhibiting some decent follow-through momentum as Thrifts & Mortgage (+1.3%) continue to recover from overblown concerns tied to the subprime mortgage debacle.

Materials, though, is turning in the best performance (+1.5%) as Diversified Chemicals (+3.1%) gets a big lift on news that Dow Chemical (DOW 45.48 +2.10) is reportedly in talks to form a strategic joint venture with India's Reliance Industries. Telecom is today's biggest disappointment as Wireless Services ranks as the morning's worst performing S&P industry group (-0.9%).DJ30 -5.62 NASDAQ +4.71 SP500 +0.55 NASDAQ Dec/Adv/Vol 878/1567/134 mln NYSE Dec/Adv/Vol 804/1855/72 mln


09:40 am : With the market hanging on every economic release to provide clues about Fed policy, today's data exaggerating inflation concerns while also providing evidence of more manufacturing weakness has left investors again questioning the sustainability of market gains predicated in part on the Fed easing at some point this year.

Fortunately for the bulls, today's bearish data -- a hotter than expected rise in Feb. core PPI and a disappointing read on the March NY Empire State index -- haven't totally undermined the momentum from yesterday as the indices have opened relatively flat. The market's focus now turns to this afternoon's Philly Fed report (12:00 ET) and tomorrow's CPI data to provide more clarity as to what policy makers may say and do when they reconvene next week to decide monetary policy. DJ30 -13.70 NASDAQ +3.55 SP500 +0.23 NASDAQ Vol 84 mln NYSE Vol 40 mln

09:15 am : S&P futures vs fair value: -2.2. Nasdaq futures vs fair value: -3.8. Futures indications continue to deteriorate heading into the opening bell, reflective of the market's sensitivity to economic data. Even though the NY Empire State Index ranks among the smaller regional manufacturing surveys, the report plunging to its lowest level since May 2005 has renewed concerns of a recession while a PPI report which tends to bounce around significantly on a month-to-month basis provides the bears with fodder to support their overblown concerns about inflation.

09:00 am : S&P futures vs fair value: -0.3. Nasdaq futures vs fair value: flat. Still shaping up to be a sluggish start for stocks as this morning's mixed economic data have taken the wind out of the market's sails. Even though earlier indications weren't pointing to a significantly higher open, a market still more focused on everything negative has viewed the larger than expected rise in core PPI as an underlying inflation risk that will continue to prevent policy makers from cutting interest rates anytime soon. The Fed meets next week (March 20-21) and, even though today's PPI report is not that critical, especially ahead of tomorrow's more influential CPI data, the Fed is widely expected to keep rates unchanged at 5.25% for a sixth straight meeting.

08:33 am : S&P futures vs fair value: -0.2. Nasdaq futures vs fair value: -0.5. Futures trade spikes lower following economic data, now suggesting a slightly lower start for the cash market. Total PPI unexpectedly jumped 1.3% (consensus 0.5%) in February. The more closely-watched core rate rose 0.4% (consensus 0.2%), prompting a knee-jerk reaction in equities but bonds have basically shrugged off the report so far in anticipation of tomorrow's more influential CPI report to provide a clearer read on inflation. The March NY Empire State Index plunged to 1.9 (consensus 17.0); but today’s Philly Fed survey will hold more influence. Initial claims fell 11K to 318K (consensus 325K).

08:00 am : S&P futures vs fair value: +4.7. Nasdaq futures vs fair value: +8.2. Early indications suggest some carry-over momentum established during yesterday's afternoon recovery from steep losses may lift stocks at the open. Reports that Intercontinental Exchange (ICE) has proposed a merger with CBOT Holdings (BOT) valued at nearly $10 bln is also contributing to the positive tone. That disposition, however, is certainly subject to change as investors await the Feb. PPI report (8:30 ET) to get an update on inflation at the wholesale level. Given the market's concerns about the pace of economic growth as well, two regional manufacturing surveys -- the NY Empire State Index (8:30 ET) and Philly Fed (12:00 ET) -- will also garner some added attention today.

06:18 am : S&P futures vs fair value: +1.9. Nasdaq futures vs fair value: +4.0.


Edit to add the 10:00 blather

Bloody greedy bastards!!!

Bloomberg Special...

http://www.youtube.com/watch?v=7fcre8P2UUY

they`re afraid to talk too loud...
bastards...sorry...cannae help it...

I remember when you first posted some of those links here. Most of the related articles were pooh-poohing the whole idea. Hence my shock at Bloomberg's coverage, makes you wonder if the matter isn't about to hit the fan and the hedge funds are trying to make sure they don't get the blame. :shrug:

54, at least the light is getting turned on...
I know people who are really picking` up the pace and
emailing` SEC demanding that this be investigated.
But we both know who the powers that be are and who they
are connected to...
Hijacked...we been bloody hijacked...!!!
B*&^%$**!! B@#^&**$#s!!

It's NAKED Short Selling...NAKED NAKED NAKED NAKED NAKED NAKED!!!!!! Any Questions?
http://www.faulkingtruth.com/Articles/LettersToEditor/1033.html
The essay when he seems to have hit the wall on the stupidity and lack of integrity which abounds in the elite wallstreeters.

Along with you I am surprised to see Bloomberg pick it up. I do see that Goldman Sachs just got hit with a $2 mil settlement fine on naked short selling allegations. Wonder if that has anything to do with Bloomberg opening their mouth.

Goldman article
http://www.iht.com/articles/ap/2007/03/14/business/NA-FIN-US-Goldman-SEC-Settlement.php

to shift the focus onto the brokers and away from large, enabling institutions and hedge funds. There are reputations at stake here ya know. :eyes:

Wonder if they'll quietly pay the brokers take the heat or risk the back flash of feeding them to the wolves.

Thanks for the article Robbien.

Stock Manipulation, who would have thunk!


:)

12:42
Dow 12,175.30 Up 41.90 (0.35%)
Nasdaq 2,378.86 Up 7.12 (0.30%)
S&P 500 1,394.69 Up 16.74 (1.21%)
10-Yr Bond 4.5380% Up 0.0160
NYSE Volume 1,448,288,000
Nasdaq Volume 872,907,000

12:30 pm : Despite an unexpected decline on the Philadelphia Fed's manufacturing index, stocks are kicking off the afternoon session retracing previous highs as the manufacturers' outlook remained generally optimistic.

The index edged lower to 0.2, just barely showing expansion, but also noted that overall activity in the region's manufacturing sector has been steady so far this month with indicators for new orders, shipments, and employment showing slight improvements from February. DJ30 +32.32 NASDAQ +4.38 SP500 +6.17 NASDAQ Dec/Adv/Vol 1168/1691/790 mln NYSE Dec/Adv/Vol 1043/2103/660 mln

12:00 pm : The major averages remain positive midday but gains are now modest at best as investors weigh more reassurance that subprime mortgage missteps have not spilled over to the credit markets against mixed economic data.

Before the bell, total PPI jumped 1.3% (consensus 0.5%) in February. The more closely-watched core rate rose 0.4% following two consecutive 0.2% gains, prompting a knee-jerk reaction in equities that continues to act as an overhang. Even though today's PPI report is not that critical, especially ahead of tomorrow's more influential CPI data, a market still more focused on everything negative has viewed the disappointing PPI data as an underlying inflation risk that will continue to prevent policy makers from cutting interest rates anytime soon.

There was also a disappointing release on manufacturing. The March NY Empire State index dropped to 1.9 from a very strong 24.4 in February, turning the focus to the upcoming Philly Fed survey (12:00 ET) to provide a clearer read on manufacturing conditions.

Aside from the market's sensitivity to economic data, investors have also been closely eyeing reports from leading brokerage firms this week to provide clarity on the troubling subprime mortgage market. Fortunately for the bulls, Bear Stearns (BSC 148.75 +3.46) following up a better than expected Q1 report by echoing comments made by Lehman Brothers (LEH 73.50 +1.78) yesterday about its limited subprime exposure and potential opportunities has helped the Financials sector build on Wednesday's rebound.

Financials' leadership, coupled with a nearly 2% surge in Materials, is so far helping to offset modest pullbacks in Health Care and Technology. Diversified Chemicals (+3.5%) is still today's best performing S&P industry group following news that Dow Chemical (DOW 45.73 +2.35) is reportedly in talks to form a strategic joint venture with India's Reliance Industries. DJ30 +8.01 NASDAQ +1.39 SP500 +3.36 NASDAQ Dec/Adv/Vol 1130/1703/680 mln NYSE Dec/Adv/Vol 916/2217/560 mln

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-03-15T170908Z_01_L15359071_RTRIDST_0_MARKETS-EUROPE-STOCKS-UPDATE-3.XML

LONDON, March 15 (Reuters) - European stocks broke a three-day losing run to end higher on Thursday as acquisition and restructuring, coupled with high metal prices, took investors' minds off worries over the U.S. mortgage market.

The FTSEurofirst 300 <.FTEU3> index of top European shares ended up 1.83 percent at 1,453.57 points, its biggest one-day gain since a slide in global equities started on Feb. 27.

"We're in a phase where we're going to have good days and bad days and volatility is likely to be with us for a while," said Mike Lenhoff, chief strategist at Brewin Dolphin. "Over a month, I doubt we'll get much beyond where we were before the latest bout of selling began," he said.

...

Carmaker DaimlerChrysler (DCXGn.DE: Quote, Profile , Research) led German gainers, rising nearly 4 percent on talk that the sale of its Chrysler unit could go through faster than expected, and drugs and chemicals group Bayer (BAYG.DE: Quote, Profile , Research) rose 3 percent after it set higher margin targets.

...

Miners gained from a 4.6-percent rise in the price of copper <MCU3=LX> to $6,545 a tonne, and a 6-percent rise in nickel, which lifted stock in Antofagasta (ANTO.L: Quote, Profile , Research), BHP Billiton (BLT.L: Quote, Profile , Research), Xstrata (XTA.L: Quote, Profile , Research) and Anglo American (AAL.L: Quote, Profile , Research) by more than 5 percent.

Many analysts expected the choppy trade to continue.

"Recent market volatility may well lay the foundations for attractive investment returns over the medium to longer term, but all the indications are that there could still be more weakness to come before we are done," said Michael Hughes, chief investment officer at Barings Asset Management.

"The typical extent of a correction during a bull market is 7 percent to 8 percent over a period of two to three months, and we have not experienced a decline of more than 10 percent in the equity markets since 2003." After a 1 percent rise on Thursday, the Morgan Stanley index of world stock markets <.MSCIWD> is still down 4.7 percent from the time the stock sell-off started in late February.

...

MORTGAGE WORRIES OVERSTATED?

/...

http://www.postfinance.ch/pf/content/en/topics/etrade/news/stockreportchev.html

The SMI closed Thursday's session in the black, tracking a positive start on Wall Street. The SNB's interest rate decision did not have a major impact on the market; the 25 basis point hike was widely expected and already priced in.

The Swiss Market Index closed 129.12 points or 1.51% higher at 8,706.78 with all blue chips pointing north. The broader Swiss Performance Index advanced 101.88 points or 1.49% to 6,955.09.

Chemicals and financials strongest

Chemicals and financials closed the session sharply higher: while banking giant UBS surged 2.37% to CHF 69.10, Credit Suisse jumped 2.99% to CHF 84.45 and Julius Baer advanced 3.31% to CHF 156.10. Syngenta rose 3.16% to CHF 221.70, Clariant closed 2.84% higher at CHF 19.95 and Givaudan soared 2.75% to CHF 1,083. However, traders warned of the damage the US subprime mortgage market will cause to the global economy, and that the worst might not be over yet.

Elsewhere sky high, Swatch bearer shares surged 3.96% to CHF 295.50 and registered shares moved 3.9% higher at CHF 59.90. The SMI's defensive heavyweights remained lazy: Novartis climbed 0.88% to CHF 68.60, Roche gained 0.82% to CHF 210.20 and Nestle hiked 0.71% to CHF 462.50.

/...

http://mwprices.ft.com/custom/ft2-com/html-story.asp?pulse=true&siteid=ft&dist=ft&guid=%7B560c80bc%2D26d8%2D4a04%2Dabcb%2Dcba28ac9073e%7D

The FTSE 100 surged on Thursday amid a sharp rally in global equities. Imperial Tobacco was the stand-out gainer as it confirmed it had made an approach for Altadis, the Spanish cigarette manufacturer. Strong overnight markets in Asia and a firm start on Wall Street boosted sentiment helped the FTSE 100 recover from previous heavy losses. The blue-chip index was further boosted by strong numbers from Prudential and Wm Morrison and confirmation from Cadbury Schweppes that it was considering a sale of its US drinks division. However, the main story was the moves towards further consolidation in the tobacco sector as Imperial confirmed it had made a €45 a share offer for the maker of Gaulois cigarettes. The news came as newspaper reports that Imperial had approached Altadis led to the Spanish group’s shares being suspended on the Madrid stock exchange. Imperial shares closed 8.6 per cent higher at £22.20 while BAT gained 2.8 per cent to £15.62. Gallaher, which is being bought by Japan Tobacco, rose 0.1 per cent to £11.31. Earlier, investors had welcomed news that Cadbury Schweppes announced its intention to separate its confectionery and US beverages businesses. Analysts estimate the US drinks arm, which makes Dr Pepper and Seven-UP, could be worth as much as £7bn. Cadbury shares were 3 per cent higher at 620½p. The FTSE 100 closed 132.5 points, 2.2 per cent higher at 6,133.2 while the mid-cap FTSE 250 gained 275.4 points, or 2.5 per cent, to 11,219.5.

Sex and drugs and (ah, right, I already sang that) lies.

Highlights

Current:



30-day and 90-day vs.greenback:



30-day vs. Euro, Yen, UK Pound and Swiss Franc




Currency Comparison: http://members.shaw.ca/trogl/looniewatch.html

Detailed analysis: http://quotes.ino.com/exchanges/?r=CME_CD

Up-to-the-minute graph: http://quotes.ino.com/chart/?s=CME_CD.H06&v=s

Historical values http://www.x-rates.com/d/USD/CAD/data30.html

2007-02-15 Thursday, February 15 0.858959 USD
2007-02-16 Friday, February 16 0.859254 USD
2007-02-19 Monday, February 19 0.859254 USD
2007-02-20 Tuesday, February 20 0.85492 USD
2007-02-21 Wednesday, February 21 0.861401 USD
2007-02-22 Thursday, February 22 0.860882 USD
2007-02-23 Friday, February 23 0.863111 USD
2007-02-26 Monday, February 26 0.861995 USD
2007-02-27 Tuesday, February 27 0.85918 USD
2007-02-28 Wednesday, February 28 0.854701 USD
2007-03-01 Thursday, March 1 0.853898 USD
2007-03-02 Friday, March 2 0.850919 USD
2007-03-05 Monday, March 5 0.84674 USD
2007-03-06 Tuesday, March 6 0.850412 USD
2007-03-07 Wednesday, March 7 0.848536 USD
2007-03-08 Thursday, March 8 0.847314 USD
2007-03-09 Friday, March 9 0.853825 USD
2007-03-12 Monday, March 12 0.855505 USD
2007-03-13 Tuesday, March 13 0.855652 USD
2007-03-14 Wednesday, March 14 0.850702 USD
2007-03-15 Thursday, March 15 0.850557 USD


Current values

Last trade 0.8500 Change
Previous Close 0.8507 Open 0.8512
Low 0.8500 High 0.8517


Blather (from http://quotes.ino.com/exchanges/?r=CME_CD)

The June Canadian Dollar was steady to slightly higher overnight as it consolidates some of this week's decline. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at .8571 are needed to confirm that a short-term low has been posted. If June renews the decline off February's high, February's low crossing at .8454 is the next downside target. Overnight action sets the stage for a steady to higher opening in early-day session trading.


Analysis

Nothing at all going on. I'm just testing from a new office.

:sadgrin:

Dow 12,133.16 0.24 (0.00%)
Nasdaq 2,372.89 1.15 (0.05%)
S&P 500 1,389.48 2.31 (0.17%)
10-yr Bond 4.5360% 0.0140
30-yr Bond 4.6930% 0.0010
NYSE Volume 1,940,773,000
Nasdaq Volume 1,177,531,000

2:00 pm : After a knee-jerk downturn in equities following recent remarks from former Fed Chairman Alan Greenspan, the market is almost as quickly recovering what was lost. At the bottom of the hour, Greenspan said subprime mortgages are "not a small issue" and that, if prices go down, the problems may spread as he expects to see spillover to other sectors.

Be that as it may, the market has shown good resilience in the face of such bearish commentary as the indices have found notable support right around the flat line. DJ30 +19.76 NASDAQ +2.49 SP500 +4.88 NASDAQ Dec/Adv/Vol 1346/1595/1.09 bln NYSE Dec/Adv/Vol 1069/2150/896 mln

1:30 pm : Stocks for the most part remain mired in relatively narrow ranges, but the indices have recently slipped to their lowest levels of the afternoon ahead of upcoming testimony from former Fed Chairman Alan Greenspan.

The absence of leadership from the heavily weighted Technology and Health Care sectors remains an obstacle for bulls who are particularly focused on picking up beaten-down banks and brokers while trying to make their claim that stocks remain undervalued at current levels.DJ30 +23.60 NASDAQ +3.25 SP500 +5.12 NASDAQ Dec/Adv/Vol 1139/1769/966 mln NYSE Dec/Adv/Vol 880/2309/802 mln

1:00 pm : Little has changed since the last update as traders make their way through what may turn out to be a longer New York lunch hour than usual. It is worth noting that with the NCAA Tournament tipping off just over 30 minutes ago, there are already signs of volume tapering off.

However, such limited participation can also just easily exacerbate potential volatility recently attributed to tomorrow's quadruple witching options expiration.

DJ30 +31.33 NASDAQ +5.17 SP500 +6.21 NASDAQ Dec/Adv/Vol 1152/1755/890 mln NYSE Dec/Adv/Vol 880/2286/730 mln

12:30 pm : Despite an unexpected decline on the Philadelphia Fed's manufacturing index, stocks are kicking off the afternoon session retracing previous highs as the manufacturers' outlook remained generally optimistic. The index edged lower to 0.2, just barely showing expansion, but also noted that overall activity in the region's manufacturing sector has been steady so far this month with indicators for new orders, shipments, and employment showing slight improvements from February.

As evidenced by the Industrials sector hitting session highs following the report, it's apparent investors are also embracing an expected pickup in growth during Q2 and improved conditions over the next six months. DJ30 +32.32 NASDAQ +5.38 SP500 +6.17 NASDAQ Dec/Adv/Vol 1168/1691/790 mln NYSE Dec/Adv/Vol 1043/2103/660 mln

http://www.bloomberg.com/apps/news?pid=20601087&sid=aMNo.k9C9eP8&refer=home

March 15 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said he expects the fallout from subprime-mortgage defaults to spread to the broader economy, especially if home prices decline.

``If prices go down, we will have problems -- problems in the sense of spillover to other areas,'' Greenspan said in remarks to the Futures Industry Association meeting in Boca Raton, Florida today. While he hasn't seen such spreading yet, ``I expect to.''

Subprime borrowers, or those with poor or limited credit histories, are increasingly defaulting after looser lending standards allowed them to take on more debt than they could afford. Last month, Greenspan told an audience in Toronto that ``disarray'' in the subprime mortgage market isn't likely to create greater financial instability in the rest of the economy.

``It is not a small issue,'' Greenspan said today. ``If we could wave a wand and prices go up 10 percent, the subprime mortgage problem would disappear.''

more...

http://www.fiendbear.com/mgckwand.htm

The Magic Wand of Liquidity Page


Bwahahahaha :evilgrin:

Thus subject to the standard piehole effect.

http://www.boston.com/business/globe/articles/2007/03/14/greenspan_let_more_skilled_immigrants_in/

snip>

Allowing more skilled workers into the country would bring down the salaries of top earners in the United States, easing tensions over the mounting wage gap, Greenspan said.

"Our skilled wages are higher than anywhere in the world," he said. "If we open up a significant window for skilled workers, that would suppress the skilled-wage level and end the concentration of income."


It's the concentration of wealth that's the problem, you jack-ass! Or maybe I should say jackal.
The man wants to return us all to the days of serfdom. :eyes:

2:24
Dow 12,137.97 Up 4.57 (0.04%)
Nasdaq 2,372.51 Up 0.77 (0.03%)
S&P 500 1,390.03 Up 2.86 (0.21%)
10-Yr Bond 4.534% Up 0.012
NYSE Volume 2,000,443,000
Nasdaq Volume 1,214,549,000

2:00 pm : After a knee-jerk downturn in equities following recent remarks from former Fed Chairman Alan Greenspan, the market is almost as quickly recovering what was lost. At the bottom of the hour, Greenspan said subprime mortgages are "not a small issue" and that, if prices go down, the problems may spread as he expects to see spillover to other sectors.

Be that as it may, the market has shown good resilience in the face of such bearish commentary as the indices have found notable support right around the flat line. DJ30 +19.76 NASDAQ +2.49 SP500 +4.88 NASDAQ Dec/Adv/Vol 1346/1595/1.09 bln NYSE Dec/Adv/Vol 1069/2150/896 mln

2:30 pm : Oil prices are hitting fresh session lows heading into the close on the NYMEX. After trading relatively unchanged throughout most of the session, after OPEC at its meeting in Vienna agreed to keep production targets steady, crude for April delivery is now down 1.0% at $57.60/bbl.

Even with higher energy prices contributing to the large jump in today's total PPI that has acted as an overhang on stocks all day, a subsequent reversal in Energy is removing what little leadership buyers have been able to muster during today's lackluster session. DJ30 +8.06 NASDAQ +1.68 SP500 +3.55 NASDAQ Dec/Adv/Vol 1288/1686/1.20 bln NYSE Dec/Adv/Vol 1005/2220/998 mln

http://www.businessweek.com/ap/financialnews/D8NSOLC03.htm

snip>

Gillmor said the lease terms showed Wal-Mart is secretly planning to move into retail banking despite assurances to the contrary in testimony last year to the Federal Deposit Insurance Corp.

"The only reasonable explanation of Wal-Mart's recent plan to revise its leases is that it plans to enter into full-scale banking," Gillmor said at a news conference in Washington. "This latest information is the smoking gun of Wal-Mart's dishonesty and deception."

Wal-Mart told the FDIC last year that it wants to open an "industrial loan corporation" for the sole purpose of saving money that it now pays outside banks that process millions of payments in Wal-Mart stores by credit card, debit card or electronic check.

"The Bank has made repeated public commitments that it will not branch, and its business plan includes neither lending nor retail deposit gathering," the retailer said in written testimony.

One of Wal-Mart's most vocal critics, union-funded WakeUpWalMart.com, said the new e-mail proved that the retailer plans to compete with community banks across the nation if it can win FDIC approval for its limited-purpose bank.

"Wal-Mart's denials aside, their words and actions prove once again that Wal-Mart's banking ambitions are real and, if not stopped, would pose a dangerous and unacceptable risk to the nation's economy," the group said.

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http://www.hussmanfunds.com/wmc/wmc070312.htm

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If we look at individual actors in the economy, it will generally be true that some of them want to save part of what they have, and some of them want to invest more than they have. So we need a way for savers to transfer their income to the people who want to use those savings. This is done by issuing securities. Money is transferred from the saver to the spender, and the spender issues a receipt which offers some hope of repayment in the future.

Here is the crucial point. Once a security is issued, that piece of paper thereafter represents savings that have already been deployed in order to purchase investment goods and services (factories, equipment, housing, computers, and so forth).

The security is simply a receipt. It means that at some point in the past, someone produced goods and services without consuming them, and someone consumed or invested in goods and services without producing them. That change of ownership was accomplished by issuing that stock, or bond, or IOU. Again, it represents money that has already been spent – goods and services that have already been deployed.

Now consider government and foreign trade. The U.S. is currently running massive federal deficits, and massive current account deficits. What's really happening here is that we are, in aggregate, consuming more than we produce, and foreigners are producing more than they consume. This difference requires the issuance of a huge volume of new securities to enact that transfer of purchasing power. The resulting mountain of issued securities does not represent newly created money looking for a home, or looking to be spent. It has already been spent! And we've spent it.

Specifically, the U.S. has issued huge volumes of Treasury securities that have been purchased, largely, by China and Japan . There's your global liquidity. It's a monstrous stock of Treasury debt that represents the claims of foreigners on our future production. That's in addition, of course, to the enormous inter-generational claims that we've promised via Social Security and Medicaid, which place further burdens on our future production.

So yes, enormous volumes of securities, primarily U.S. Treasuries and mortgage securities, have been issued in recent years. Foreigners hold a staggering quantity of the Treasury securities. Our own financial system holds direct and indirect claims on a lot of the toxic stuff like mortgage debt. Wall Street talks about all of this using the upbeat term “liquidity.” But what it really represents is a crushing pile of claims on our future production, as well as high risk junk, some of which (like sub-prime mortgage debt) is already starting to go belly-up. This is not money “looking for a home.” It is a pile of IOU's for money that has already been spent.

To understand the importance of this to the “money on the sidelines” mirage and the “liquidity sloshing around looking for a home” fallacy, notice that as the U.S. issues more Treasury debt, that debt simply must be held by someone. It is clear, then, that we must by necessity observe a rising stock of apparent “money on the sidelines” in the form of Treasuries on the balance sheets of foreign central banks, U.S. corporations, and individual investors. There is no other way. Again, these securities represent spending that our government has already done. It is not wealth (at least, not to the U.S. ) but a claim on future production. Nor it is money that “has to find a home.” It has already arrived, moved in, and in many cases, trashed the place. If somebody sells these bonds to buy stocks, somebody else has to buy the bonds and sell the stocks. In aggregate, no money goes into or out of either stocks or bonds by virtue of such transactions.

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Dow 12,159.68 26.28 (0.22%)
Nasdaq 2,378.70 6.96 (0.29%)
S&P 500 1,392.28 5.11 (0.37%)
10-yr Bond 4.5360% 0.0140
30-yr Bond 4.6920% 0.0020
NYSE Volume 2,751,560,000
Nasdaq Volume 1,757,538,000

4:20 pm : Stocks built on Wednesday's gains, as investors weighed more reassurance that subprime mortgage misfortunes aren't spreading into the credit markets and some M&A activity against mixed economic data.

With Bear Stearns (BSC 148.50 +3.21) known to have the most exposure to subprime mortgage debt compared to its large-cap brokerage brethren, management following up a solid Q1 report by saying its subprime exposure isn't huge (only 3%), and that dislocations provide opportunities, helped investors eventually look past the latest rumblings from former Fed Chairman Greenspan.

Speaking to the Futures Industry Association in Florida, Greenspan said that subprime mortgages are "not a small issue" and that, if prices go down, the problems may spread, as he expects to see spillover to other sectors. That prompted a knee-jerk reversal in stocks around 1:30 ET.

Market participants, though, eventually took a bullish cue from notable leadership throughout the recently beaten-down Financials sector and closed the major averages higher for a second straight day. The sector got an added lift after Intercontinental Exchange (ICE 128.10 -3.83) announced a $9.9 bln rival bid for CBOT Holdings (BOT 194.95 +28.86), which is slated to merge with the Chicago Mercantile Exchange (CME 532.87 -31.10).

Merger news also provided a floor of support for the Consumer Staples, Materials and Utilities sectors. As evidenced by Drug Retail turning in one of the day's best performances, CVS Corp (CVS 33.34 +1.03) shareholders approved the $26 bln takeover of Caremark Rx (CMX 62.75 +1.67) while Walgreen Co. (WAG 45.75 +1.12) surged 2.4% amid rumors of a potential takeover.

With regard to Materials, the day's best performing S&P 500 sector, Dow Chemical (DOW 45.78 +2.40), reportedly in talks to form a strategic joint venture with India's Reliance Industries, also raised speculation of a potential buy-out or break-up. TXU Corp. (TXU 64.39 +1.58) was a Utilities sector standout following reports that Blackstone Group and the Carlyle Group have approached power companies to partner on a TXU bid.

Separately, investors had a batch of economic data to digest today as well. With the market hanging on every economic release to provide clues about Fed policy, today's data exaggerating inflation concerns, while also providing evidence of more manufacturing weakness, initially acted as an overhang.

However, today's bearish data -- a hotter than expected rise in Feb. core PPI and two disappointing regional manufacturing surveys (NY Empire State Index and Philly Fed) -- didn't totally undermine the momentum from yesterday as the market decided to await tomorrow's more closely-watched CPI report to provide more clarity as to what policy makers may say and do when they reconvene next week. DJ30 +26.28 NASDAQ +6.96 SP500 +5.11 NASDAQ Dec/Adv/Vol 1126/1887/1.71 bln NYSE Dec/Adv/Vol 948/2330/1.46 bln

3:30 pm : Unlike yesterday, when large-cap names were among the biggest winners, tech bellwethers like MSFT, CSCO, GOOG, and APPL which averaged gains of 1.7% Wednesday are all trading lower going into the close of trading today.

Such action has been further evidenced by the Russell 2000 small-cap index and S&P 400 MidCap Index turning in the best performances. Both are up more than 0.7% versus gains of only 0.2%, 0.4% and 0.2% for the Dow, S&P 500 and Nasdaq, respectively. DJ30 +28.36 NASDAQ +5.64 SP500 +5.07 NASDAQ Dec/Adv/Vol 1231/1758/1.39 bln NYSE Dec/Adv/Vol 1012/2239/1.18 bln

3:00 pm : The indices have ticked a bit higher within the last 30 minutes but hardly enough to make a significant change in the standings. Perhaps that's because most of the recent buying efforts have been centered around the Utilities sector, which is at session highs (+1.4%) but ranks among the least influential of the 10 economic sectors. TXU Corp. (TXU 64.39 +1.58) has been the sector standout following reports that Blackstone Group and the Carlyle Group have approached power companies to partner on a TXU bid.

Leveraged buyout speculation has also provided a lift to the defensive-minded Consumer Staples sector (+0.7%), as Walgreen (WAG 45.34 +0.74) spikes higher (+1.7%) within the last few minutes as rumors resurface about a potential takeover. DJ30 +29.96 NASDAQ +5.16 SP500 +5.86 NASDAQ Dec/Adv/Vol 1286/1694/1.27 bln NYSE Dec/Adv/Vol 1074/2150/1.07 bln