STOCK MARKET WATCH, Monday July 14

Source: du

STOCK MARKET WATCH, Monday July 14, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 191
DAYS SINCE DEMOCRACY DIED (12/12/00) 2731 DAYS
WHERE'S OSAMA BIN-LADEN? 2456 DAYS
DAYS SINCE ENRON COLLAPSE = 2747
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

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U.S. FUTURES &
MARKETS INDICATORS>
NASDAQ FUTURES-----------------------------S&P FUTURES

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AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.
$1 USD = EUR 1.06678
$1 USD = JPY 116.6200

AT THE CLOSING BELL ON July 11, 2008

Dow... 11,100.54 -128.48 (-1.14%)
Nasdaq... 2,239.08 -18.77 (-0.83%)
S&P 500... 1,239.49 -13.90 (-1.11%)
Gold future... 960.60 +18.60 (+1.94%)
30-Year Bond 4.52% +0.10 (+2.17%)
10-Yr Bond... 3.94% +0.13 (+3.38%)






GOLD,EURO, YEN, Loonie and Silver

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PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact actionpost@legitgov.org

For information on protests and other actions Citizens For Legitimate Government

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Read more: du

blah blah blah

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

You'd think something a little more topical would open the week...

His head cannot venture from its present location. His sphincter muscle is just too strong.

"It would also allow the Treasury to buy stock in the companies." What a lying, POS, hypocrite, fool and whore Mr. Wood is.

SINGAPORE - Oil prices were little changed Monday in Asia on expectations the dollar will continue to slide as a slowing U.S. economy lessens the likelihood of an interest rate hike.

The U.S. Federal Reserve said Sunday it would lend if necessary to major U.S. government-backed mortgage giants Freddie Mac and Fannie Mae, which have seen their stock prices plummet amid subprime loan turmoil. The Treasury Department also said it would seek congressional approval to make a possible equity investment in the two companies.

.....

Midday in Singapore, light, sweet crude for August delivery was down 2 cents at $145.06 a barrel in Asian electronic trading on the New York Mercantile Exchange.

The contract rose to a trading record of $147.27 a barrel in New York on Friday before closing at $145.08, just down from Thursday's settlement record of $145.29.

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

July 14 (Bloomberg) -- Petroleum-exporting nations from Saudi Arabia to Russia are not only charging Americans record high prices for fuel, they are also poised to become the biggest creditor to the U.S. government.

Holdings of Treasuries by oil producers and institutions such as U.K. banks that are proxies for Middle East nations rose 44 percent this year to $510.8 billion through April, four times faster than the rest of the world, according to the Treasury Department's most recent data. At the current pace, they'll surpass Japan, which holds $592.2 billion, as the largest owner this month.

While the investment of so-called petrodollars into government debt is helping to temper a rise in borrowing costs as the U.S. finances a record budget deficit, it highlights America's dependence on foreign money. New York's Chrysler Building was bought last week by Middle East investors.

http://www.bloomberg.com/apps/news?pid=20601072&sid=a6Wvs4IX.Et0&refer=energy

---

Our economic conditions will soon redefine "Land of the free..."

(hat-tip to radfringe)

Help for Fannie and Freddie appears to be last coming from government

updated 7:23 p.m. ET, Sun., July. 13, 2008

NEW YORK - The U.S. government is signaling it won’t throw a lifeline to struggling financial companies — except for mortgage linchpins Fannie Mae and Freddie Mac — marking a shift to a new and potentially more volatile phase of the credit crisis.

Such an approach could mean beaten-down investment banks like Lehman Brothers Holdings Inc. and regional banks must now fend for themselves as they try to recover from billions of dollars in mortgage-related losses. That is bound to unnerve an already turbulent Wall Street and make investors even more anxious as they await financial companies’ earnings reports that are expected to be down a stunning 69 percent from a year ago when all the numbers are in.

And, for consumers already squeezed by tightening credit standards, it could mean getting a mortgage will become even harder.

http://www.msnbc.msn.com/id/25665655

WASHINGTON - Scrambling to bolster eroding investor confidence, the Federal Reserve and the Treasury Department announced steps to brace slumping mortgage giants Fannie Mae and Freddie Mac.

The companies' shares have plunged as losses from their mortgage holdings threatened their financial survival.

....

The Fed said it granted the Federal Reserve Bank of New York authority to lend to the two companies "should such lending prove necessary." They would pay 2.25 percent for any borrowed funds — the same rate given to commercial banks and big Wall Street firms.

The Fed said this should help the companies' ability to "promote the availability of home mortgage credit during a period of stress in financial markets."

....

The Treasury's plan also seeks a "consultative role" for the Fed in any new regulatory framework eventually decided by Congress for Fannie and Freddie. The Fed's role would be to weigh in on setting capital requirements for the companies.

http://news.yahoo.com/s/ap/20080714/ap_on_bi_ge/mortgage_giants_crisis

---

Whatever legislation arises from this deal will certainly be signed immediately - unlike other mortgage rescue legislation of recent months.

that is: they fall over, what would that mean for people who have a mortgage with them?

I figured - if there is no longer a financial system that sends you a bill every month, then you don't have to pay. Or not?

This article is a little thin on the mortgage holder side. It focuses on the interests of the investor. As an aside - the implications of such a colossal failure would shake everyone regardless of your financial relationship with these two underwriters.

http://money.cnn.com/2008/07/09/news/companies/benner_fanniefreddie.fortune/index.htm?postversion=2008070914

Edited to add this paragraph:

Fannie Mae and Freddie Mac are government sponsored enterprises that help the mortgage market function by purchasing pools of loans and packaging them into securities. If one or both couldn't function, the result would be chaos. "If Fannie or Freddie failed, it would be far worse than the fall of Bear Stearns," said Sean Egan, head of credit ratings firm Egan Jones. "It could throw the economy into depression or something close to it."

Chopper Ben's wet dream would come to fruition.

I'm Dutch, so the economic situation (and more importantly: the economic speak) is not something that came naturally to me.

I just figured that: if the mortgage lender topples over, all its existing debts will be reduced to nil. There simply isn't anyone around to send the bills if the company stops existing.
This could mean that the investors in Freddie Mack could wave after their money but they will never see it again. The mortgage-bound consumer then would be the sole owner of the property. Freddie Mack lost the bet.

But now the Govt is helping out the big mortgage lenders. Why?

A Federal bailout would add an instant 50% to our national debt and would devastate the value of the dollar.

I can't imagine this would be a full bailout. The consequences are severe, otherwise.

Since you are Dutch, the Housing Market here has been like the Dutch Tulip Bulb speculation of the 1636. Housing prices were a bubble for many years, aided by speculation and low mortgage rates. That bubble has burst.

A long time ago (1938, trying to recover from the Great Depression here) it was decided that home ownership, part of the so called American Dream, was a national priority. People could not afford homes and banks would not lend money. So the Federal National Mortgage Association (FNMA) was created. People call this by the nickname Fannie Mae. In 1968 Congress decided to privatize FNMA and also create the Federal Home Loan Mortgage Corporation (Freddie Mac) as competition.

So a special 'quasi' corporation called a GSE (Government Sponsored Enterprise) was born because even though they are private, they still get legal benefits that private companies dont. In particular they have to hold less cash reserves than private banks (they are more leveraged).

Because these entities are government sponsored, people have assumed that the full faith and credit of the US Treasury stands behind these organizations. However, that is not written in law. In fact the law creating GSE's specifially says otherwise. But people still think a failure of these institutions would be too dire to not do anything.

For a 'fee' these institutions protect the banks in case of a default by the mortgagee. The problem is that with all the foreclosures and faults, it is putting a stress on Freddie Mac/Fannie Mae. Adding to this mess is that these guys have use hedge funds and those are hurting too.

Thanks for the explanation. Funny you bring up the tulip 'windhandel', the 'windtrade'. We got taught about that in grade school. 'Don't buy and sell if it isn't worth shit to begin with!'

Sounds like some unfair competition going on. I suppose that's how things work, but still...

Now, who's going to clean up the mess? Apparently the US Govt cannot, because it will make them bankroet. So probably the taxpayer, which includes the Europeans nowadays. Hmmm...

Anyway, I think its strange that the scam of the century got so little attention.

Just think, no payments!

The downside: your house will be worth less than a bicycle.

The govt. will buy your worthless shares, my fellow cronies.

But you with the defaulted mortgage will be summarily foreclosed upon! Your children will be thrown into the street. Your financial life will be destroyed.

What a country!

NEW YORK - The U.S. government is signaling it won't throw a lifeline to struggling financial companies — except for mortgage linchpins Fannie Mae and Freddie Mac — marking a shift to a new and potentially more volatile phase of the credit crisis.

Such an approach could mean beaten-down investment banks like Lehman Brothers Holdings Inc. and regional banks must now fend for themselves as they try to recover from billions of dollars in mortgage-related losses — unlike Bear Stearns Cos., whose buyout the government helped orchestrate in March. That is bound to unnerve an already turbulent Wall Street and make investors even more anxious as they await financial companies' earnings expected to be down a stunning 69 percent from a year ago when all the numbers are in.

.....

But some of Wall Street's biggest investors believe there was another message in the government's announcement — the rest of the financial sector seems unlikely to get a helping hand. Global banks and brokerages have already written down nearly $300 billion in soured mortgage investments — a number projected to ultimately reach $1 trillion.

.....

On Wall Street, Monday could be a critical day, with investors quite nervous amid the uncertainty in the financial sector. Friday, as investors tried to assess the health of the mortgage financiers, the Dow Jones industrial average dropped below 11,000 for the first time in nearly two years, and the overall market was left with its fourth straight weekly loss. The government's support of Fannie and Freddie in part was meant to assuage investors around the world.

http://news.yahoo.com/s/ap/20080714/ap_on_bi_ge/credit_crisis_new_phase

Didn't the government bail out some other people when the shit first hit the fan? Seems our gubermenint loves socialism for the rich but cutthroat capitalism for the rest of us. By the way, they are working on taking away your Social Security and medicare to cover the cost of these bail outs.

they are getting more than one person can read in the Financials today.

Companies mess up and it is the tax payers job to fix their mess (pay for it) and if a company is successful a few at the top get the rewards and you don't get layed off (that is your reward).

I must admit to being hopelessly naive. The Fed opens its discount window to Freddie and Fannie, which is an admission that there is a problem but not much of a solution, since the GSEs are certain not to use it (accessing the discount window is a kiss of death, seen an admission that a firm is desperate).

Treasury Secretary Paulson makes a statement which presents in the vaguest possible terms a plan which falls far short of a remedy for the GSEs. These measures merely serve to stabilize the patient; there is no, zip, nada acknowledgment that major surgery is needed (Felix Salmon has an amusing but pointed parsing of Paulson's remarks).

Oh, minor detail, the plan still has to be approved by Congress, which will hopefully roll over. But what if it doesn't? Anyone with an operating brain cell knows that these moves put the US on the path to having taxpayers assume Fannie and Freddie liabilities. That in the end is probably unavoidable.

But the largely positive reaction in the press is simply mind-boggling and the Asian market response, particularly a rise in the dollar against most currencies, says that investors approve (update: gains early in the day reversed, largely on oil worries). Um, having to admit you are moving down the path of the lesser of two evils is far from good, at least in my book. particularly when six months ago most people had no knowledge that this course of action was even remotely a possibility.

Clive Crook in the Financial Times is far more clear-eyed about the matter:



By contrast, Paul Krugman, Princeton colleague of Bernanke, joins the side of the boosters.

Christopher Wood, in a pre-Paulson edition of his Greed & Fear report, correctly anticipated that the Administration would attempt an optical rather than a real solution, but doubts that that will succeed:



more...

http://www.nakedcapitalism.com/2008/07/real-test-of-not-yet-plan-fannie.html

There have now been 5 FDIC insured bank failures in 2008, the most since 2002 (11). But this is nothing compared to number of failures during the S&L crisis in the '80s and early '90s.

To put the 2008 failures into perspective, here is a graph of bank failures since the FDIC was created in 1934. The 5 failures this year hardly show up on the graph.

Note: thousands of banks failed during the Depression, and bank failures were very common even before the Depression, with about 600 banks failing every year during the Roaring '20s. And, yes, there is a Bank Implode-O-Meter that includes credit unions and other banking problems too.

One of the interesting aspects of the IndyMac failure was the average size of the insured deposits. According to the FDIC, there were $18 billion in insured deposits and "over" 200,000 depositors. If we divide $18 billion by 200 thousand, this gives an average deposit of $90,000. This average seems very high; I'd expect most banks would have many depositors with just a few thousand dollars - and, therefore, a far lower average insured deposit size.

This suggests that many of these deposits were from conservative investors chasing the highest FDIC insured yields.* Banks that rely on this type of deposit (and pay the highest yields) would seem to be the most susceptible to online bank runs. These relatively high yield FDIC insured deposits are an example of moral hazard.

....

Surprisingly the WSJ reports that the percentage of uninsured deposits has been growing rapidly:



And from Louise Story at the NY Times: Analysts Say More Banks Will Fail



Jane Wells at CNBC has Bove's list: After IndyMac, Who's Next?. Here is Bove's list of banks in the 'danger zone' according to Wells: Downey Financial, Corus Bankshares, Doral Financial, FirstFed Financial, Oriental Financial, and BankUnited Financial.



http://calculatedrisk.blogspot.com/2008/07/coming-bank-failures.html

New IndyMac CEO reassures consumers

NEW YORK (AP) — The new chief executive of IndyMac Bancorp said late Sunday new lending standards should prevent the kind of problems that have brought down credit markets.

John Bovenzi, the former chief operating officer of the Federal Deposit Insurance Corp. put in charge of IndyMac, reassured consumers that bank failures have been rare in the past, and that if more banks do fail, the government has enough in reserve.

"I think the important point to make is that, historically, only a very small percentage of the banks on our problem banks list ever failed," he said on CNN. "While there are 90 banks on the list, there would be no expectation that 90 of those banks would fail."

http://ap.google.com/article/ALeqM5hls5Dl742PNVLeupkvmNQiaB4A7gD91TJFMO2

---

Was there ever a publicly declared expectation that IndyMac would fail? Just asking.

Okay, lemme see if I got this right, regarding the Fannie/Freddie mess. Please provide corrections where needed!

I guess my basic assumption/starting point is that too many people borrowed too much money that they can't pay back.

If that's true, is it also true that the problem has two root causes:
1. The mortgages were based on grossly inflated real estate prices
and
2. Some of the mortgages were made to people who didn't have the ability to pay them back, either because the information regarding their income was falsified, they didn't understand the terms, whatever.

It seems to me there isn't a whole lot that can be done about the inflated real estate prices. The sellers already have the money, and the sellers could be anyone from speculators to developers to individuals, like me. So doesn't it make sense to work from the angle of finding out how people can repay their borrowed money? I mean, that's the real problem, so doesn't it make sense to, um, solve the problem???

F&F didn't actually make all these loans, as I understand it; they just "guaranteed" them. So Bank A actually makes the mortgage, expects to make $XY either over the term of the loan or by selling it to someone else, but F&F guarantee that the profit will be there one way or another, even if the mortgagee can't pay. So even though F&F had little to do with causing the actual problem -- people not being able to repay -- they're on the hook for the banks' stockholders' expectations.

Any bailout of F&F to guarantee these loans that are now defaulting doesn't help the people who can't pay -- so it doesn't really solve the problem. Have I got it right so far?

The whine seems to be that if F&F go under, no one will be able to get mortgages any more and the housing industry will collapse. . . . and so will "the American Dream" of home ownership. The solution to the whine, therefore, is to LEND F&F more money.

Now, if the Fed lends F&F money, this will COST F&F. They will have to pay interest on it, making F&F less able to make/back mortgages than if they were actually bringing the money in on actual mortgages, either the ones they hold or the ones they "package" to investors. So if we were to solve the problem of people being able to repay their loans, this would
A. Bring more money in directly to F&F
and
B. Make the mortgages they back more attractive to "investors."
therefore
C. Enabling F&F to continue to make loans
and thus
D. Stimulating the housing market so backlog inventory could be sold, new construction would be demanded, and the whole economy would get back on its feet.

Obviously, D wouldn't happen overnight. But without living wage jobs, without a healthy economy, no one can afford to get mortgages anyway. No one can save for a down payment, and no one can afford the monthly payments.

The way I see it, any "bailout" of F&F is not going to help the mortgage/housing market very much at all. It's not going to keep people from losing their homes to foreclosure and/or greatly reduced selling prices. That means there's no stimulus to the construction business. It means the economy will be further depressed, more people will be unable to afford their mortgages, more homes will go into foreclosure, further depressing home prices . . . . . . etc.

So to me, the whole bailout notion is addle-headed. It won't do anything to really help the homeowners, the potential homeowners, or the economy in general. It will only help the shareholders in F&F and it will only do so temporarily, because people STILL won't be able to pay their mortgages and in fact MORE people won't be able to. Ultimately, there will be no market, no economy, and the whole thing will collapse -- but . . . . .

The shruggers will have got their loot and their dream: the total destruction of the American economy and the cancellation of the American experiment. It's all about them after all, isn't it.


I'm reading Fareed Zakaria's "The Post-American World" right now, and I'm finding it almost laughable. He seems to be painting such a rosy picture of the underlying strengths of the U.S. economy, even though the housing bubble had popped long before the book's publication. Some of his reference sources are embarrassingly lame, and once I know an author hasn't done his/her research, I begin doubting EVERYTHING in the book. His message is "Don't worry, America is too big to fail."

Yeah, right.



Tansy Gold

The shruggers will have got their loot and their dream: the total destruction of the American economy and the cancellation of the American experiment. It's all about them after all, isn't it.

yes

It must have been a couple of months ago that we had the discussion about Ayn Rand and Atlas Shrugged and so on, and in the midst of that I actually pulled out my copy and started to read it.

One of the things that had bothered me and prompted the discussion was that Rand seemed to set up Eddie Willers from the beginning of the book. His attempts, his faithful, almost dog-like trust in Dagny and Taggart Transcontinental had stuck with me all these years since my first 1968 reading. And I wondered why Rand doomed him. It was looking again at Eddie's "end" in the last few pages of the book that set me to posting about it here.

But when I went back to re-read it, I was literally sickened to my stomach by what I discovered.

The book opens with Eddie, and Eddie serves as the connective tissue between Dagny and her nemesis/hero. On the third page, I came across this about Eddie --

"He had spent most of his childhood with the Taggard children, and now he worked for them, as his father and grandfather had worked for their father and grandfather."

I got this creepy feeling, this inherited wealth/landed aristocracy/absolute monarchy chill. I knew Rand had fled Russia after the Revolution and that she ws virulently anti-communist. . . .

But then a few pages later, I got confirmation:

"James Taggart smiled; it was a thin smile, amused and cold. 'It's touching, Eddie,' he said. 'It's touching -- your devotion to Taggart Transcontinental. If you don't look out, you'll turn into one of those real feudal serfs.'

"'That's what I am, Jim.'"

It's on the bottom of page 10, to the top of 11 in my limited edition, autographed 10th anniversary commemorative edition. :puke:


Remember, all, that Alan Greenspan suckled at this woman's philosophical tit for years. The Objective of the "good guys" in Atlas Shrugged -- and by extension of the Objectivists that Rand led -- was the destruction of the world's economy so they could go in and remake it in their image. She was the originator of the "greed is good" mantra, and she meant it.



Tansy Gold

She's not about a healthy system of capitalism at all, its all about 'old money' keeping control along with their good breeding and all that bullshit. In a fair system, the best managers would rise to the top and there would be less corruption. In the system of Shruggers it is the most greedy who get to stay on top and rise higher. Hasn't this been highlighted under the Bush Administration?

The novel seems full of misinformed theme, as in: there are only a fixed number of people in the world capable of functioning as the captains of industry and if the collectivist mob should ever take control then they are under threat of disappearing and the world would de-evolve. The true threat is not the collectivists leeching off of the successful, it is the greedy leeching off of those who should be successful under a fairer system. Yes, there should be a strike.

the bail out cash. Neither the F&F problem or the mortgage problem are going to be fixed. They will continue to throw tax payer money at both problems to protect the uber-wealthy.

*gasp*


You mean, like, what would happen in a, uh, Free Market?

Thanks to Madfloridian for posting this.

http://www.cnbc.com/id/25518912

As Oil Firms Seek Drilling Access, Exports Set Record
Topics:Politics & Government | Environment | Alternative Energy | Energy | Commodities
Sectors:Industrial Goods and Services | Utilities | Oil and Gas
By Reuters | 03 Jul 2008 | 03:23 PM ET
Font size:

While the U.S. oil industry wants access to more federal lands to help reduce reliance on foreign suppliers, U.S.-based companies are shipping record amounts of gasoline and diesel fuel to other countries.

AP
A record 1.6 million barrels a day in U.S. refined petroleum products were exported during the first four months of this year, up 33 percent from 1.2 million barrels a day over the same period in 2007. Shipments this February topped 1.8 million barrels a day for the first time during any month, according to final numbers from the Energy Department.

The surge in exports appears to contradict the pleas from the U.S. oil industry and the Bush administration for Congress to open more offshore waters and Alaska's Arctic National Wildlife Refuge to drilling.

"We can help alleviate shortages by drilling for oil and gas in our own country," President Bush told reporters this week. "We have got the opportunity to find more crude oil here at home."

"As a nation, we can have more control over our energy destiny by supplying more of the oil and natural gas we'll be consuming from resources here at home," Red Cavaney, president of the American Petroleum Institute, said in a letter last week to U.S. lawmakers.

(snip)


Capitalism at it's finest, and Democrats in Congress are about to get punked again.

Just like the "Great Hunger" in Ireland. We have plenty of food to export. We just don't have any for you.

And the price of gas is up how munch this year? Around 33%?

ST. LOUIS - Anheuser-Busch, the maker of Budweiser and Bud Light, has agreed to a takeover by a giant Belgian brewer, a union that creates a global beer leader and brings to an end one of the most iconic names in American business.

The board of directors of Anheuser-Busch Cos. Inc. on Sunday accepted a sweetened $52 billion takeover offer from Belgian brewer InBev SA, according to a joint press release.

The deal, which is subject to shareholders' and regulators' approval, would create the world's largest brewer and create the fourth-largest consumer product company worldwide.

.....

It wasn't immediately clear how long approval might take. Several Missouri politicians have expressed concerns about the merger — especially how it would affect the approximate 6,000 people employed by Anheuser-Busch in St. Louis.

InBev said it plans to use St. Louis as its North American headquarters, and that it will keep open all 12 of Anheuser-Busch's North American breweries.

http://news.yahoo.com/s/ap/20080714/ap_on_bi_ge/anheuser_busch_inbev

We have pictures in the family album of Mike and Molly the last team before tractors took over the family farm work in 1939 in SW Minnesota.

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

Last trade 72.223 Change +0.332 (+0.46%)

Will The Dollar Buckle?

http://www.dailyfx.com/story/topheadline/Will_The_Dollar_Buckle__1215981543092.html

Forget microeconomics. The currency market these days is trading almost exclusively on two macro themes. One - are Fannie and Freddie about to cause a systemic collapse of the US financial system? Two – is Iran really trying to provoke a military response from Israel? If the answer to either one of those questions is yes, the dollar may buckle under pressure.

In the first case, a bankruptcy of the two GSE giants which between them guarantee more than 5 Trillion dollars of mortgage assets could create a massive disruption in the financial system sending capital towards the euro as a safe haven bid. In the second case, escalation of geopolitical tensions is likely to only expand the fear premium in crude as worries about disruptions in the strait of Hirmuz will keep oil traders in a state of anxiety and push prices above the $150 level. In that outcome, skyrocketing inflation will also favor the euro as the ECB appears to be far more serious about controlling price pressures than the Fed.

Fortunately, as the week came to a close neither one of the doomsday scenarios occurred. Fannie and Freddie managed to live another day and the fixed income markets narrowed the spread premium of their bonds over Treasuries as authorities worked all day to reassure the markets. If the dust settles next week and investor confidence returns, the dollar could see a rebound, especially against the yen as risk premiums abate. If however we see a second round of panic selling and the Dow continues to drop towards the 10K level, the dollar will likely weaken across the board with EURUSD pushing through the 1.60 figure as volatility spikes.

As to the micro story, inflation gauges will be the focus of the week with both PPI and CPI numbers due out mid-week. Given the merciless increases in energy costs, inflation reports are likely to surprise to the upside but just how much of an impact they will have on price remains to be seen. One other report that’s sure to interest the currency market will be the minutes of the last FOMC meeting which may help traders determine the seriousness of Fed intention to fight inflation and finally everyone will pay attention to the Retail Sales number to sense just how well the US consumer is coping with this turmoil. BS



...more...

Fannie and Freddie’s Troubles are a Lose-Lose for the US Dollar

http://www.dailyfx.com/story/bio1/Fannie_and_Freddie_s_Troubles_are_1215810765021.html

Calling the financial markets active today is practically an understatement. The combination of soaring oil prices and problems with Fannie Mae and Freddie Mac triggered sharp volatility in the equity and currency market. At one point during the US trading session, the Dow jumped 200 points within minutes, driving EUR/JPY to a record high. The market was initially very disappointed by US Treasury Secretary Paulson’s reluctance to bailout Fannie Mae and Freddie Mac, but they were pleasantly surprised by Bernanke’s offer to access the discount window (The ABCs of Fannie Mae and Freddie Mac’s Problems). However their optimism was short-lived as stocks resumed their slide. The biggest question in the financial markets right now is whether or not Fannie and Freddie are too big to fail? If the government stepped in to prevent the Bear Stearns meltdown from crushing the market, they will undoubtedly step in to prevent a collapse in Fannie Mae or Freddie Mac because if either GSE fails, Americans will have to shoulder the burden. Fed Chairman Ben Bernanke has already announced that the GSEs can have access to the discount window, which would allow them to borrow money directly from the Federal Reserve rather than the markets. If Fannie and Freddie's problems are not solved and they still have difficulties borrowing, this means that they will have difficulties lending, which is something that the US government can not risk at this moment. For the currency market, it is a lose-lose situation for the US dollar. Further problems at Fannie and Freddie would push stocks lower once again, which would trigger another flight to safety out of US dollars. A bailout would essentially double the public debt, risking a downgrade in the US credit rating. Expect Friday’s volatility to continue into the new trading week. We have a very busy US economic calendar that includes retail sales, producer prices, consumer prices, the Empire State and Philly Fed manufacturing surveys, industrial production, the Treasury International Capital flow report, housing starts and the minutes from the last FOMC meeting. Meanwhile the trade balance was stronger than the market expected thanks to a rebound in exports. Consumer confidence also improved modestly but it still remains near a 30 year low.

...more...

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/07/11/cnmoney111.xml&CMP=ILC-mostviewedbox

<snip>

"The money supply is crumbling in the US. There was a very sharp lending contraction in the second quarter lending. If the Federal Reserve is forced to raise rates now to defend the dollar, it would be checkmate for the US economy," he said.

Leigh Skene from Lombard Street Research said the lending conditions in the US were now the worst since the Great Depression. "Credit liquidation has begun," he said.

The Fed's awful predicament does indeed have echoes of the early 1930s when the bank felt constrained to tighten into the Slump in order to halt bullion loss under the Gold Standard. Investors - notably foreigners - dictated a perverse policy. Over 4,000 US banks collapsed. This time a de facto "Oil Standard" is boxing in Ben Bernanke. Benign neglect of the dollar has started to backfire. It is pushing up crude, with multiple leverage.

The monetary picture is highly complex. The different measures - M1, M2, M3, M4 - have all given false signals in the past. Each tells a different tale, and monetarists fight like alley cats among themselves.

The Federal Reserve stopped paying much attention to the data a long time ago. It has abolished M3 altogether. The US economic consensus is New-Keynesian (dynamic stochastic general equilibrium model). Delving into the money entrails is derided as little better than soothsaying.

That attitude, retort monetarists, is the root cause of the credit bubble. The money supply almost always gives advance warning of big economic shifts. Those who track the data are now calling on central banks to move with extreme caution. If the rate-setters overreact to an inflation spike caused by oil and food - or confuse today's climate with the early 1970s - they may set off an ugly chain of events.

...more...

As their name indicates, DSGE models are dynamic, studying how the economy evolves over time. They are also stochastic, taking into account the fact that the economy is affected by random shocks such as technological change, fluctuations in the price of oil, or errors in macroeconomic policy-making. This contrasts with the static models studied in Walrasian general equilibrium theory, applied general equilibrium models and computable general equilibrium models.

Traditional macroeconometric forecasting models used by central banks in the 1970s, and even today, estimated the dynamic correlations between prices and quantities in different sectors of the economy, and often included thousands of variables. Since DSGE models are technically more difficult to solve and analyze, they tend to abstract from so many sectoral details, and include far fewer variables: just a few variables in theoretical DSGE papers, or on the order of a hundred variables in the experimental DSGE forecasting models now being constructed by central banks.

What DSGE models give up in sectoral detail, they attempt to make up in logical consistency, because they are founded on microeconomic principles of constrained decision-making. Therefore, DSGE models must spell out the following aspects of the economy.

---

Advantages and disadvantages of DSGE modeling

By specifying preferences (what the agents want), technology (what the agents can produce), and institutions (the way they interact), it is possible (in principle, though challenging in practice) to solve the DSGE model to predict what is actually produced, traded, and consumed. In principle, it is also possible to make valid predictions about the effects of changing the institutional framework.

In contrast, as Robert Lucas pointed out, such a prediction is unlikely to be valid in traditional macroeconometric forecasting models, since those models are based on observed past correlations between macroeconomic variables. These correlations can be expected to change when new policies are introduced, invalidating predictions based on past observations.

Given the difficulty of constructing accurate DSGE models, most central banks still rely on traditional macroeconometric models for short-term forecasting. However, the effects of alternative policies are increasingly studied using DSGE methods. Since DSGE models are constructed on the basis of assumptions about agents' preferences, it is possible to ask whether the policies considered are Pareto optimal, or how well they satisfy some other social welfare criterion derived from preferences (Woodford, 2003, p. 12).

---

Schools of DSGE modeling

At present two competing schools of thought form the bulk of DSGE modeling.

* Real business cycle (RBC) theory builds on the neoclassical growth model, under the assumption of flexible prices, to study how real shocks to the economy might cause business cycle fluctuations. The paper of Kydland and Prescott (1982) is often considered the starting point of RBC theory and of DSGE modeling in general. The RBC point of view is surveyed in Cooley (1995).

* New-Keynesian DSGE models build on a structure similar to RBC models, but instead assume that prices are set by monopolistically competitive firms, and cannot be instantaneously and costlessly adjusted. The paper that first introduced this framework was Rotemberg and Woodford (1997). A textbook presentation is given by Woodford (2003), and monetary policy implications are surveyed by Clarida et al. (1999).

References for this Wiki entry are heavily weighted on Princeton models.

http://en.wikipedia.org/wiki/Dynamic_stochastic_general_equilibrium

http://news.yahoo.com/s/nm/20080714/bs_nm/sec_examination_dc

WASHINGTON (Reuters) - U.S. securities regulators are boosting efforts to stop the spread of false rumors that threaten financial institutions, after a week that saw steep slides in the shares of Fannie Mae (FNM.N), Freddie Mac (FRE.N) and Lehman Brothers (LEH.N).

In an unusual weekend statement, the U.S. Securities and Exchange Commission warned on Sunday that regulators would immediately examine whether broker-dealers and investment advisers have controls in place to prevent market manipulation.

Examiners from the SEC, New York Stock Exchange Regulation and the broker-dealer watchdog, the Financial Industry Regulatory Authority, will see if the controls are designed to prevent the intentional creation or spreading of false information.

Securities officials said the timing of the announcement was aimed at getting word of the crackdown out before Asian markets open on Monday, the first to trade globally.

"It's to prevent rumors that threaten commercial banks, investment banks and government-sponsored enterprises (Fannie Mae, Freddie Mac)" said one securities official on condition he was not named.

...more...

There's not a problem in our banking system, so shut up!

ummmm....

Is that why the FDIC has 90 banks on the "troubled" list?

http://www.reuters.com/article/bondsNews/idUSBNG14763120080714

July 14 (Reuters) - Morgan Stanley cut Deutsche Bank (DBKGn.DE: Quote, Profile, Research, Stock Buzz) to "underweight" and recommended shorting the stock, and halved its dividend forecast for Swiss banks Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz) and UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) for 2009 and 2010.

"The credit cycle is far from over, so dividend cuts and significant balance sheet de-leveraging are needed," Morgan Stanley said in a note to clients.

Analysts at Morgan Stanley said if there was a write-down or loss, it would be harder for Deutsche Bank to cover any capital ratio shortfall than some peers due to its dependence on investment banking revenue.

Morgan Stanley lowered its price target on the German bank by 20 euros to 59 euros, cut its 2009 earnings estimates by 7 percent and increased charge-offs for 2008 by 2 billion euros.

However, Morgan Stanley kept its "overweight" rating on Credit Suisse and "equal weight" on UBS relative to the banking sector, which it views as "cautious."

...more...

But... but... but... I guess since Deutsche is German, it doesn't count? Or, are more interested in taking down other countries' banks?

The world is black-and-white you know. Shall we now get rid of the buy and strong buy, etc categories used by investment banks?

Q) Why did the chicken cross the road?

A) To get the fuck out of the way when Deutsche collapses.

And we all know that the SEC is all about fairness. Greenscam's cryptic musings about the markets' strengths and weaknesses are the stuff of legend.

But fact is, the truth is worse than the rumor....

Has it come to that? Is the US economy going to go under because of Fannie and Freddy?

May we all survive these "Interesting Times" as the Chinese curse puts it. (Figures it would be China that holds the cards, no?)

HONG KONG - Most Asian markets fell Monday as investors worried over the depth of U.S. credit and housing problems after the country's central bank moved to prop up ailing mortgage financiers Fannie Mae and Freddie Mac.

Many of the region's major benchmarks opened higher but shed their gains. Only major indices in China and the Philippines held up against the negative swing. European markets, meanwhile, rose in early trade.

Japan's Nikkei 225 index lost 0.2 percent to close at 13,010.16. Hong Kong's blue-chip Hang Seng Index dropped 0.8 percent to 22,014.46.

The declines came after the U.S. Federal Reserve said Sunday it was granting its New York branch authority to lend to the two mortgage giants "should such lending prove necessary." The measure allows Fannie Mae and Freddie Mac to borrow from the central bank at 2.25 percent — the same rate given to commercial banks and big Wall Street firms — should they need short-term funding in the face of a slumping U.S. housing sector and tightening credit market.

http://news.yahoo.com/s/ap/20080714/ap_on_bi_st_ma_re/world_markets

NEW YORK - U.S. stocks headed for a sharply higher open Monday after the Federal Reserve and the Treasury Department outlined steps aimed at shoring up confidence in mortgage giants Fannie Mae and Freddie Mac.

Shares of the government-chartered companies have tumbled over the past week as investors have fretted over whether they could survive losses in their mortgage portfolios.

.....

But in the early going investors appeared pleased with the government's actions. Dow futures rose 97, or 0.87 percent, to 11,193. Standard & Poor's 500 index futures rose 14.40, or 1.16 percent, to 1,250.70, while Nasdaq 100 index futures advanced 18.75, or 1.03 percent, to 1,839.25.

Bond prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its yield, rose to 3.98 percent from 3.96 percent late Friday.

http://news.yahoo.com/s/ap/20080714/ap_on_bi_st_ma_re/wall_street

You would think that it was a Pre-Market Morning in 1999, not 2008.

Apparently, the news about FNM and FRE has Wall Street all in a lather, the Dollar is up, the Lambs are frolicking in the Meadow oooohing and ahhhing at the Otherworldly things their new 3G iPhone will do, and once again the Orwellian, happy-talk Financial Media will turn to page 127 in their Hymnals and Sing to the top of their lungs "Hark The Herald Bailouts Ring! The Superclass Need Not Worry About One Damn Thing!", and lament proudly that the Worst of The Credit Crisis Is Over.
No, REALLY this time!

IndyMac DOES NOT MATTER

Bank Failures DO NOT MATTER

Systemic Risk DOES NOT MATTER

Economic Collapse DOES NOT MATTER

The Fed Discount Window, Magical Thinking, Soothing Happy-Talk Phrases, Carefully Crafted Propaganda, and a 24/7 Blazing Printing Press are all that's needed to make everything function normally.

are you certain that it's just not all "rumors"?

:hi:

We see this every time the system gets close to a collapse point. The Fed will wave it's magic wand, proclaim that the problem is solved, Wall Street does a Victory Lap, and the Financial Media proclaims that once again, God (The Fed) has spoken and that everyone can go back to American Idol.

We saw this back in January, with the Rate Cuts, the Bear Stearns Firesale to JPM, and the Stimulus Checks. We were constantly told that all was well, the Worst of The Credit Crisis was over, and if we all just held hands and bought a Plasma, that the Dow would be at 20,000 by summer.

In essence what really happened was the Criminals bought themselves six months of illusory nonsense, until this past week when we found out that not only did the previous BS not work, things are in even WORSE shape that they were in January.

Lather, Rinse, Repeat.

And they will keep doing this, because so far, the Infinite Fiat Circus has worked.

And it will continue to work.

Until it doesn't.

Billy-Bob USA's stimuless check will protect him from all evil, right?


He has cookouts and trips to Six Flags planned for the summer.

Nothing you say will get through to harsh his buzz.

Ah...soothing Beethoven.

rumors are all in their heads while visions of a bailout dance around the beds...

that all those who speak the truth about the current financial fiasco are categorized as "whiners".

I posted this image in a thread in the Economics Forum.

It speaks to me....

http://www.247wallst.com/2008/07/fannie-mae-fn-3.html

The federal government has decided that Fannie Mae (FNM) and Freddie Mac (FRE) are too big to fail. The Fed and Treasury will offer a combination of loans and stock purchases to make sure that the two mortgage operations have adequate capital to operate smoothly. By some estimates, the government will put $15 billion into the companies, which will almost certainly push down the value of their common shares due to dilution. But, it will not wipe that stockholders out.

Investors and employees at Bear Stearns were not so lucky. Shareholders in IndyMac (IMB), which was seized by the government last week, will walk away with nothing. People with money in Countrywide would likely have done no better if Bank of America (BAC) has not bought the company, a move that some analysts say could still back-fire.

The Fed and Treasury almost certainly did the right thing. Those who believe that only the free market should determine the fate of financial institutions may want to make an exception with FRE and FNM. They hold or support almost 50% of US mortgages. Their paper is owned in great quantity by every major bank and brokerage house. A failure of one or both companies would cause hundreds of millions of dollars in bank write-offs and would hurt the chances of the average citizen getting a home loan.

<snipping to the "rumors">

That brings the argument around to money center banks and brokerages. Market rumors are that Lehman (LEH) may not make it. Wachovia (WB), Washington Mutual (WM), and Citigroup (C) may reach a point of no return. Who decides if any of these gets government assistance? Congress? The Fed? The Treasury?

...more...

what will the SEC do now!

Why was Countrywide allowed to be merged, but IndyMac was taken over by FDIC?

federally backed and insured bank

:eyes:

so it just got eaten by a bank and now the taxpayers will be on the hook if BoA goes under

:eyes:

duh, how could I have forgotten that so soon

:crazy:

The only information I can find to explain this says that Countrywide was not a major deposit-taking corporation. Other information also indicates that too many deposits made to Countrywide were not insured based on how they were structured: not labeled "In trust of... (depositor's name)".

The distinction seems razor-thin to me. But the substance rests in how the functions of each organization are separated.

There have been many more mortgage companies that just stopped business and went bankrupt
http://ml-implode.com/

Interested to see how the Friday dump of the Indymac situation plays out, along with Fannie, and Freddie fallout.

I had to extend some effort to find news about this failure. News is all about the Fannie/Freddy rescue and InBev's acquisition of Anheuser-Busch.

I imagine that very few people in the US know we just had our 2nd largest bank failure.

(post #39)

The new CEO was actually an employee of the FDIC until about 72 hours ago. The ink on his script is still wet.

Can't you see that Billy-Bob USA is concentrating on his vacation. Stop being such a downer.

:sarcasm:

That domino-effect is gathering steam.

On 7/12/08 and 7/13/08, CNN had special reports about the failure of IndyMac bank. Here is a link with some videos...

http://www.cnn.com/video/#/video/business/2008/07/13/nr.mortgage.side.cnn?iref=videosearch


edit: be sure to look in that list for the video with Suze Orman on the IndyMac failure. She gets a bit ticked off that these bad loans have been written for so many years, and no one was doing their job to investigate them. She says the Enron people were taken to jail, so should the people involved with the mortgage scandal go to jail.

7/14/08 From Karl Denninger's blog

Folks, this is an absolutely disaster. We have regulators sleeping at the switch, paying zero attention to the issues until they threaten to literally explode in their face. This has gone on for years, and most notably, became absolutely blatant last spring when WaMu started reporting less cash earnings than were required for them to pay their dividend!

"Now here's the problem: In 1Q 06, 194 million out of $985 is 19.7%. In December, it was 31%. But this last quarter, it was FORTY SIX PERCENT, more than a DOUBLE over the year ago levels.

And what's worse, not one dime of that "income" can be spent! It is entirely phantom.

This is the same sort of crap that sunk Lucent and Enron - booking "income" that is not in fact spendable, as it has an impairment associated with it (the LTV is INCREASED by this negative amortization) AND it is not CASH!"

There's that "E" word again - ENRON.

Folks, this sort of crap is exactly what I and others have been talking about. It is willful and blatant neglect of any sort of rational standard of care among our regulators and lawmakers, and since they are in the government you can't sue them nor is there any criminal indictment that can issue for their blindness!

You want to know what I think?

This whole damn thing is a shell game. Let's count the ways that you as a taxpayer are being absolutely frapping ROBBED by these clowns in Washington DC:

1. The OTS, OCC and FDIC are ignoring 10Qs like the WaMu one I cited above, which make quite clear that the bank's position is deteriorating rapidly and, absent something that historically-speaking is almost certain not to happen (housing to immediately turn around), they are threatened as a going concern.
2. As these firm's position deteriorates further they start advertising hard for deposits, offering to pay insane (compared to their peers) coupons on CDs and similar. This of course further narrows their spread between what they pay for money and what they make on loans.
3. Their book continues to deteriorate in credit quality. Still, nobody cares to mind the store. Fancy that.
4. Finally, someone notices that the curtains are on fire and everyone (bank)runs. Suddenly regulators are forced to act, and then of course they blame the person who yelled "Fire!" - instead of yelling at either the guy who LIT the fire, or themselves, who had a bucket of water but refused to throw it while it was still smoldering.

The regulators have had more than a full year's worth of warning on this, and have done nothing, and that is working off only the published 10Qs and 10Ks from these firms! But these regulators have much more - they are in these firms all the time looking at their books and "examining" them, so they have lots of material non-public information to go along with it!

lots more...
http://market-ticker.denninger.net/archives/514-Monday-Madness.html

7/13/08
Sen. Charles Schumer said Sunday the Bush administration is trying to "blame the fire on the person who calls 911" by suggesting he had a role in one of the costliest U.S. bank failures.

Federal regulators with the Office of Thrift Supervision were "asleep at the switch" when it came to IndyMac's "reckless" behavior, the New York Democrat complained.

Schumer, a member of the Senate Banking Committee, chairman of Congress' Joint Economic Committee and the third-ranking Democrat in the Senate, rejected any suggestions of responsibility for IndyMac's collapse

"OTS ought to stop pointing false fingers of blame and start doing its job to protect the future of the banking system, so that there won't be other IndyMacs," he said.

"IndyMac was one of the most poorly run and reckless of all the banks," he said. "It was a spinoff from the old Countrywide, and like Countrywide, it did all kinds of profligate activities that it never should have. Both IndyMac and Countrywide helped cause the housing crisis we're now in."

Schumer argued that the "breadth and depth" of the problems at IndyMac were "apparent for years, and they accelerated in the last six months." But OTS, he said, "was asleep at the switch and allowed things to happen without restraint.

"And now they are doing what the Bush administration always does: Blame the fire on the person who calls 911."

more...
http://www.cnn.com/2008/POLITICS/07/13/indymac.schumer/index.html

Maybe I should change my pool date to September 2. That was the date of the collapse in Atlas Shrugged, the blueprint for our destruction.



Tansy Gold, telling the truth but not spreading rumors

Ignore it and it will go away. We can't have another bad day on the markets ya know.

WASHINGTON (Reuters) - U.S. securities regulators are boosting efforts to stop the spread of false rumors that threaten financial institutions, after a week that saw steep slides in the shares of Fannie Mae (FNM.N), Freddie Mac (FRE.N) and Lehman Brothers (LEH.N).

In an unusual weekend statement, the U.S. Securities and Exchange Commission warned on Sunday that regulators would immediately examine whether broker-dealers and investment advisers have controls in place to prevent market manipulation.


http://news.yahoo.com/s/nm/sec_examination_dc;_ylt=AtNp1yAFyZPI4FHmNVRDA0gDW7oF

Good morning everyone. It should be a fascinating week. And by "fascinating", I mean "terrifying".

By the way, I've only been including American layoffs in this post, but Canada and the UK are losing quite a lot of jobs as well.

American LaFrance - Summerville, NC - 130 jobs lost


City of Monroe, WA - ?? jobs lost


Vance AFB - Enid, OK - 70 jobs total


Oakland Tribune - Oakland, CA - 24 jobs lost (Not the best source on this one)


Washington Mutual - nationwide - unknown number of jobs lost (on top of 7,500 already announced)


Flint City Jail - Flint, MI - 30 jobs lost


Rochester City School District - Rochester, NY - 101 jobs lost


Massachusetts Turnpike Authority - 28 jobs lost


United Airlines - nationwide - 400 jobs lost (on top of 3,000 previously announced)

InBev and Anheuser-Busch are celebrating the creation of the world's largest beer company, after news that the board of the Budweiser-brewer voted to accept a sweetened $49.9 billion bid from InBev. (See "InBev Bags Anheuser-Busch")

But InBev has yet to lay out its plans for widely-expected job cuts, as the two firms seek to centralize operations.

The Belgo-Brazilian brewer would not comment on job cuts Monday, but the firm is already talking about cost savings, which will mean a significant reduction of its work force, analysts said. St. Louis-based Anheuser-Busch (nyse: BUD - news - people ) already proposed in late June to cut 10% to 15% of its workforce, or around 1,000 jobs, through early retirement and attrition.

Gerard Rijk, an analyst with ING Financial Markets, said job cuts would happen particularly at the corporate level, as well as in the marketing and administrative departments. "The companies can merge their businesses in the UK, China and North America," he said.

In response to concerns of job cuts, InBev, whose mostly Brazilian management team has a reputation for ruthless cost-cutting, promised to keep the headquarters of the North American division of the company in St. Louis and pledged that it wouldn't close any of Anheuser's breweries.

http://www.forbes.com/markets/2008/07/14/inbev-anheuser-busch-update-markets-equity-cx_jb_je_0714markets06.html

They eat less.

I wonder what will happen to their theme parks. We've been to Grants Farm in St. Louis a few times. Free admission, free beer, and a lot of animals.

And the wife and I took a day 2 weeks ago to visit Busch Gardens in Tampa. It's only 40 minutes away, and we bought passes for a year.

Welcome to the wonderful world of TOTAL OUTSOURCING!!

Where's PITA when ya need them :shrug:

01. Midwest Airlines to cut 40% of workforce, or 1,200 jobs
11:13 AM ET, Jul 14, 2008

There's obviously no longer anything to worry about.

Dow +133
NASDAQ +24
S&P +13

Dow 11,208.34 107.80 (0.97%)
Nasdaq 2,259.03 19.95 (0.89%)
S&P 500 1,252.07 12.58 (1.01%)
10-Yr Bond 3.95% 0.01

NYSE Volume 136,230,218.75
Nasdaq Volume 52,902,722.656

It'll wear off after lunch.

On edit.
Someone pissed in the Kool-Aid. I got up to pour a cup of coffee, and the Dow is only up 25pts now, and NASDAQ is negative!

It seems you can only fool some of the people for a short period of time these days.

10:02
Dow 11,138.65 Up 38.11 (0.34%)
Nasdaq 2,240.89 Up 1.81 (0.08%)
S&P 500 1,243.16 Up 3.67 (0.30%)
10-Yr Bond 3.93% Down 0.01
NYSE Volume 486,469,843.75
Nasdaq Volume 221,940,890.625

09:40 am : The major indices open on a sharply higher note, lifted by news that the government plans to prop up Fannie Mae (FNM 12.57, +2.32) and Freddie Mac (FRE 9.10, +1.35).

Treasury Secretary Paulson announced a plan to temporarily increase the line of credit that Fannie and Freddie have with the Treasury, give temporary authority for the Treasury to purchase equity in the companies and give the Federal Reserve more oversight on the companies. Congress needs to approve the plan. Meanwhile, both Fannie and Freddie will be allowed to access the Fed's discount window, which is similar to the emergency measures the Fed put in place for investment banks.

Meanwhile, some merger and acquisition items are also helping the market. Anheuser-Busch (BUD 67.33, +0.83) accepted an acquisition offer from InBev, after the Belgian company sweetened its offer to $70 per share, or $52 billion, from $65 per share. Separately, Waste Management (WMI 34.95, -1.40) offered to acquire Republic Services (RSG 32.43, +4.53) for $34 per share in cash, or roughly $6.2 billion, a 22% premium over RSG's closing price on Friday. DJ30 +108.45 NASDAQ +15.72 SP500 +11.67

Dow
11,124.48 +23.94 (0.22%)

Nasdaq
2,231.07 -8.01 (-0.36%)

S&P 500
1,240.43 +0.94 (0.08%)

This is a train wreck; I can't look away.

July 14 (Bloomberg) -- European stocks and U.S. index futures rose after Treasury Secretary Henry Paulson moved to shore up Fannie Mae and Freddie Mac and takeovers increased. Asian shares declined.

Alliance & Leicester Plc surged 47 percent after Banco Santander SA agreed to buy the U.K. bank, while Anheuser-Busch Cos. climbed on InBev NV's plan to pay $52 billion for the brewer of Budweiser. Continental AG, Europe's second-biggest tiremaker, jumped on talks with Schaeffler Group. Fannie Mae and Freddie Mac gained more than 35 percent in pre-market trading.

Europe's Dow Jones Stoxx 600 Index advanced 1.8 percent to 275.19 at 1:20 p.m. in London, while futures on the Standard & Poor's 500 Index rose 1 percent. The Stoxx 600 last week closed at its cheapest relative to earnings in at least six years as record oil prices hurt automakers and airlines and concern deepened Fannie Mae and Freddie Mac were short of capital.

``Attractive valuations have become hard to resist,'' said Peter Jarvis, a London-based director of European equities at F&C Asset Management, which has about $200 billion. ``The corporate sector clearly believes assets are now at the wrong price. The fact that recent high-profile deals are being done with cash adds further weight to the argument.''

/... http://www.bloomberg.com/apps/news?pid=20601085&sid=a.rCscsjaHWU&refer=europe

July 14 (Bloomberg) -- Banco Santander SA, Spain's biggest bank, agreed to acquire beleaguered U.K. mortgage lender Alliance & Leicester Plc for 1.26 billion pounds ($2.6 billion) after walking away when the price was higher.

Alliance & Leicester rose as much as 54 percent, the most since the company went public in 1997, after Santander said it will provide 1 billion pounds of capital in the takeover of the Leicester, England-based bank. The all-stock offer of 299 pence a share amounts to 317 pence, or 1.33 billion pounds, including the half-year dividend, Santander said in a statement.

Emilio Botin, 73, is buying Alliance & Leicester after making at least $60 billion of acquisitions from Brazil to Mexico since he became Santander chairman in 1985. The takeovers included Abbey National, the U.K.'s second-biggest mortgage lender, for 9.2 billion pounds in 2004. Santander plans to reduce British assets by as much as 30 billion pounds as it combines Abbey and Alliance & Leicester amid the worst housing market in more than 15 years.

``They've shown with Abbey that they can turn a business round in the U.K.,'' said Piers Hillier, the London-based head of European equities at WestLB Mellon Asset Management who manages 6 billion euros, including Santander shares. ``If they buy Alliance & Leicester at this price, it's a great deal for Santander.''

Alliance & Leicester rose 98.5 pence to 317.75 pence at noon in London, valuing the bank at 1.34 billion pounds and paring this year's decline to 50 percent. Credit Agricole SA, France's biggest bank, dropped a bid two years ago to buy Alliance & Leicester when its market value was 5.2 billion pounds.

Botin said Feb. 7 the bank wouldn't bid for Alliance & Leicester after looking at its books earlier this year. The price Santander offered today in the 3-for-1 stock swap is 46 percent below U.K. lender's price of 588 pence on Feb. 7.

/... http://www.bloomberg.com/apps/news?pid=20601085&sid=aLWjNadgv.YQ&refer=europe

LONDON, July 14 (Reuters) - European shares rose on Monday in a session dominated by merger activity that swept through sectors, including brewers and banks, while a U.S. mortgage rescue plan underpinned the broader equities market.

Stocks globally took heart from a U.S. Treasury and Federal Reserve plan to lend money and buy equity if needed in the government-sponsored enterprises, which own or guarantee $5 trillion in debt -- close to half of the value of all U.S. mortgages.

But fresh concern about the impact of the credit crisis on the financial sector stripped U.S. stocks of their early gains and pushed European shares down from the day's highs by the close of trade.

The FTSEurofirst 300 index of top European shares ended up 0.76 percent at an unofficial 1,134.91 points, after having risen earlier by as much as 1.8 percent.

"The market in some ways is relieved that the authorities in the United States have been able to come up with a solution to the problem of funding for Freddie Mac and Fannie Mac, however, there is a realisation that there are still some fundamental factors which are creating negative sentiment in the global markets right now," said Barclays Stockbrokers strategist Henk Potts.

/.. http://www.reuters.com/article/marketsNews/idCAL145564420080714?rpc=44

On MSNBC. No link yet.

First, I want to apologize for the use of language I don't normally see in the SMW thread.

Second, I'd just like to say: Bush is a dickhead.

except maybe sputtering from the dem side, followed by an apology

the repubs will cheer and go neener neener neener

that being said - so bush lifts the ban today - will gas prices go down tomorrow? no. assuming oil companies will do something with all this off shore acreage - it's still going to be several years before any oil flows from these sites.

this is another pschological boost by the world's biggest polluter

I've seen references to new production expected to come online from the Gulf of Mexico and ... Montana?

How do you expect US Oil Industry to increase their profits
if they don't get more access to oil to refine and export it
to other countries ?

http://www.cnbc.com/id/25518912


---
"I didn't -- I swear I didn't -- get into politics to feather my nest or feather my friends' nests."
-George W. Bush in the Houston Chronicle

10:06
Dow 11,142.23 Up 41.69 (0.38%)
Nasdaq 2,235.13 Down 3.95 (0.18%)
S&P 500 1,243.04 Up 3.55 (0.29%)
10-Yr Bond 3.932% Down 0.008
NYSE Volume 579,962,437.5
Nasdaq Volume 277,250,375

10:00 am : The major indices retreat off their opening highs as the financial sector comes under selling pressure. The sector opened 1.9% higher, but quickly reversed to a loss of 2.5% as regional banks (-4.7%) stumbled.

A run on regional bank Indymac Bancorp (IMB 0.15, -0.13) spurred its collapse over the weekend, and takeover by the FDIC. The collapse is expected to cost the FDIC between $4 and $8 billion dollars. This does not come as much of a shock, as the 99% plummet in the bank's stock price indicated that failure was a strong possible. However, there are fears that other regional banks face collapse.DJ30 +54.55 NASDAQ +2.89 SP500 +3.88 NASDAQ Adv/Vol/Dec 1196/190 mln/1139 NYSE Adv/Vol/Dec 1687/147 mln/1167

Baghdad on the Potomac is ready to collapse.

FARNBOROUGH, England - Etihad Airways says it is placing an order for 45 Boeing aircraft worth US$9 billion at list prices.

The deal announced at the Farnborough International Airshow on Monday comprises 35 Boeing 787 aircraft and 10 Boeing 777-300ER.

Etihad, the national airline of the United Arab Emirates, is also placing options for a further 25 Boeing 787s and 10 Boeing 777s.

Aircraft deliveries will begin 2011 and be completed in 2020.

http://www.msnbc.msn.com/id/25673831/

http://finance.yahoo.com/q?s=FRE

http://finance.yahoo.com/q?s=fnm

Both up between 2-4% right now.

10:31
Dow 11,112.10 Up 11.56 (0.10%)
Nasdaq 2,231.37 Down 7.71 (0.34%)
S&P 500 1,240.56 Up 1.07 (0.09%)
10-Yr Bond 3.90% Down 0.04
NYSE Volume 903,319,440
Nasdaq Volume 418,831,000

Morning Fellow Whiners! :hi:

Edited for: Phunktuachion.

.

Indeci looks more like Indecisive....


Hello all. Been peeking, miss lurking, miss posting...

Lots to do and too little time to do it in.

ltr

td

Main Entry:
indices

plural of index

http://www.merriam-webster.com/dictionary/indices

My lack of indecisiveness proved to be orthographically inadequate. I guess that means 'haste makes waste'.

Here are the top five foreign holders according to FreedomWorks:

http://www.marketwatch.com/news/story/chinese-government-top-foreign-holder/story.aspx?guid=%7B347DF7BF-F0B7-48C9-A418-5A0B903D9F72%7D&dist=hppr

Especially when we're going back for a second. And a third. And a fourth....

Also posted in ED & Art

"Here’s the background: Fannie Mae — the Federal National Mortgage Association — was created in the 1930s to facilitate homeownership by buying mortgages from banks, freeing up cash that could be used to make new loans. Fannie and Freddie Mac, which does pretty much the same thing, now finance most of the home loans being made in America.

The case against Fannie and Freddie begins with their peculiar status: although they’re private companies with stockholders and profits, they’re “government-sponsored enterprises” established by federal law, which means that they receive special privileges.

The most important of these privileges is implicit: it’s the belief of investors that if Fannie and Freddie are threatened with failure, the federal government will come to their rescue.

...

Still, isn’t it shocking that taxpayers may end up having to rescue these institutions? Not really. We’re going through a major financial crisis — and such crises almost always end with some kind of taxpayer bailout for the banking system.

And let’s be clear: Fannie and Freddie can’t be allowed to fail. With the collapse of subprime lending, they’re now more central than ever to the housing market, and the economy as a whole. "

http://www.nytimes.com/2008/07/14/opinion/14krugman.htm

7/14/08 Fed's war against shady home loans
In nod to consumer advocates, regulators tighten regulations, requiring lenders to evaluate subprime borrowers' ability to pay and banning most pre-payment penalties.

The Federal Reserve unanimously approved new mortgage lending rules Monday in a crackdown on shady practices - particularly subprime loans made to borrowers with weak credit.

The agency made several substantial revisions to the proposed regulations it unveiled in December. Many of the changes acknowledged consumer advocates' concerns that the rules still contained too many loopholes that would allow shady lending practices to continue.

But the Fed also made some concessions to industry executives, who feared increasing oversight would lead to less lending.

The new rules will apply to all mortgage lenders, not just those supervised and examined by the Fed. All but one requirement will take effect Oct. 1, 2009. However, board members said they will continue to work on further oversight of the mortgage industry.

"The proposed final rules are intended to protect consumers from unfair or deceptive acts and practices in mortgage lending, while keeping credit available to qualified borrowers and supporting sustainable homeownership," said Fed Chairman Ben S. Bernanke. "Besides offering broader protection for consumers, a uniform set of rules will level the playing field for lenders and increase competition in the mortgage market, to the ultimate benefit of borrowers."

more...
http://money.cnn.com/2008/07/14/news/economy/fedrules/index.htm?cnn=yes

WASHINGTON—A panel of top business leaders testified before Congress about the worsening recession Monday, demanding the government provide Americans with a new irresponsible and largely illusory economic bubble in which to invest.

"What America needs right now is not more talk and long-term strategy, but a concrete way to create more imaginary wealth in the very immediate future," said Thomas Jenkins, CFO of the Boston-area Jenkins Financial Group, a bubble-based investment firm. "We are in a crisis, and that crisis demands an unviable short-term solution."

The current economic woes, brought on by the collapse of the so-called "housing bubble," are considered the worst to hit investors since the equally untenable dot-com bubble burst in 2001. According to investment experts, now that the option of making millions of dollars in a short time with imaginary profits from bad real-estate deals has disappeared, the need for another spontaneous make-believe source of wealth has never been more urgent.

"Perhaps the new bubble could have something to do with watching movies on cell phones," said investment banker Greg Carlisle of the New York firm Carlisle, Shaloe & Graves. "Or, say, medicine, or shipping. Or clouds. The manner of bubble isn't important—just as long as it creates a hugely overvalued market based on nothing more than whimsical fantasy and saddled with the potential for a long-term accrual of debts that will never be paid back, thereby unleashing a ripple effect that will take nearly a decade to correct."

http://www.theonion.com/content/news/recession_plagued_nation_demands

Just thought I'd lighten up the mood a little.

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.Y%24%24&v=s&w=5&t=l&a=1

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

2008-06-02 Monday, June 2 0.998901 USD
2008-06-03 Tuesday, June 3 0.994926 USD
2008-06-04 Wednesday, June 4 0.985707 USD
2008-06-05 Thursday, June 5 0.980873 USD
2008-06-06 Friday, June 6 0.981643 USD
2008-06-09 Monday, June 9 0.978186 USD
2008-06-10 Tuesday, June 10 0.976467 USD
2008-06-11 Wednesday, June 11 0.983284 USD
2008-06-12 Thursday, June 12 0.977517 USD
2008-06-13 Friday, June 13 0.972573 USD
2008-06-16 Monday, June 16 0.979432 USD
2008-06-17 Tuesday, June 17 0.980296 USD
2008-06-18 Wednesday, June 18 0.98174 USD
2008-06-19 Thursday, June 19 0.987167 USD
2008-06-20 Friday, June 20 0.982994 USD
2008-06-23 Monday, June 23 0.984155 USD
2008-06-24 Tuesday, June 24 0.98668 USD
2008-06-25 Wednesday, June 25 0.986777 USD
2008-06-26 Thursday, June 26 0.988045 USD
2008-06-27 Friday, June 27 0.988142 USD
2008-06-30 Monday, June 30 0.981836 USD
2008-07-01 Tuesday, July 1 0.978474 USD
2008-07-02 Wednesday, July 2 0.987459 USD
2008-07-03 Thursday, July 3 0.980008 USD
2008-07-04 Friday, July 4 0.980008 USD
2008-07-07 Monday, July 7 0.982898 USD
2008-07-08 Tuesday, July 8 0.979912 USD
2008-07-09 Wednesday, July 9 0.989315 USD
2008-07-10 Thursday, July 10 0.989805 USD
2008-07-11 Friday, July 11 0.990786 USD

Current values

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

Market            Open   High    Low   Last  Change    Pct 
CD.Y$$ Cash     0.9913 0.9951 0.9912 0.9936 +0.0030 +0.30% 
CD.U08 Sep 2008 0.9900 0.9940 0.9900 0.9910 +0.0013 +0.13% 
CD.Z08 Dec 2008 0.9800 0.9800 0.9800 0.9890 -0.0008 -0.08% 
CD.H09 Mar 2009 0.9757 0.9757        0.9885 -0.0005 -0.05% 
CD.M09 Jun 2009 0.9880 0.9880 0.9880 0.9879 -0.0003 -0.03% 
CD.U09 Sep 2009 0.9865 0.9865 0.9865 0.9875  0.0000  0.00% 
CD.Z09 Dec 2009 0.9845 0.9845 0.9845 0.9871 +0.0003 +0.03%  

Other combinations: (http://quotes.ino.com/exchanges/?c=currencies)

Market          Open    High    Low     Last    Change   Pct 
AUSTRALIAN $/CANADIAN $ (CME:ACD)
ACD.U08 Sep 2008 0.9665 0.9665 0.9665 0.9665 +0.0036 +0.37%   
EURO/BRITISH POUND (NYBOT:GB)
GB.U08.E Sep 2008 (E) 0.79910 0.79910 0.79870 0.79870 -0.00295 -0.37%   
EURO/JAPANESE YEN (NYBOT:EJ)
EJ.U08.E Sep 2008 (E) 168.10 168.12 167.83 167.83 -0.40 -0.24%    
EURO/US$ (SMALL) (NYBOT:EO)
EO.U08.E Sep 2008 (E) 1.58180 1.58560 1.58140 1.58520 +0.00155 +0.10%    

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

The September Canadian Dollar was slightly higher overnight as it extends last week's rally. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If September extends last week's rally, the reaction high crossing at 99.42 is the next upside target. Closes above the reaction high crossing at 99.42 are needed to renew the rally off June's low. Closes below the reaction low crossing at 97.54 would open the door for a possible test of June's low crossing at 96.82 later this summer. First resistance is last Friday's high crossing at 99.23. Second resistance is the reaction high crossing at 99.42. First support is the 20-day moving average crossing at 98.42. Second support is the reaction low crossing at 97.54.


Analysis

While I rarely understand what the blather is going on about, today's numbers have to have already touched 99.40 for September and 99.50 for cash so if they close that way, we'll be establishing a trend that hopefully will show some long-term reverse movement against the lead balloon greenback.

I was out in the yard and my wife called me in to see the news of the announcement of the Iraqi oil contracts awarded exclusively to US companies. My understanding of the situation is that Saddam had already signed contracts primarily with Canadian, British and Dutch companies. Hence the primary purpose of the Iraq war was to overturn these contracts (see my oilwars website below) - hence making this an economic war against Canada.

Raht!!! That's it. Nukes at dawn.

Aren't you sorry now you sent us all that yellowcake?

Agent Mike: I declare war on the United States at least once a week and keep forgetting to actually implement. This will probably be no exception.

"Nukes at dawn". I'm a bomb baby. I remember early morning tests of the Emergency Broadcast system with that horrible whining tone on the TV. One time they did it and there was a fireball over Buffalo that scared the complete shit out of me. (It was the sun rising).

Canadian Iraqi oil contracts: I'll have to look this up but I think it's somewhere on my site.

Current values

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

Market            Open   High    Low   Last  Change    Pct 
CD.Y$$ Cash     0.9913 0.9951 0.9912 0.9946 +0.0040 +0.40% 
CD.U08 Sep 2008 0.9900 0.9940 0.9900 0.9941 +0.0044 +0.44% 
CD.Z08 Dec 2008 0.9800 0.9800 0.9800 0.9934 +0.0044 +0.44% 
CD.H09 Mar 2009 0.9757 0.9757        0.9929 +0.0044 +0.45% 
CD.M09 Jun 2009 0.9880 0.9880 0.9880 0.9923 +0.0044 +0.45% 
CD.U09 Sep 2009 0.9865 0.9865 0.9865 0.9919 +0.0044 +0.45% 
CD.Z09 Dec 2009 0.9845 0.9845 0.9845 0.9915 +0.0044 +0.45%  

Blather

The September Canadian Dollar closed higher on Monday as it extends last week's rally. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If September extends this week's rally, the 62% retracement level of the May-June decline crossing at 99.80 is the next upside target. Closes below the reaction low crossing at 98.13 would temper the near-term friendly outlook in the market. First resistance is today's high crossing at 99.49. Second resistance is the 62% retracement level crossing at 99.80. First support is the 20-day moving average crossing at 98.44. Second support is the reaction low crossing at 97.54.

Analysis

The problem is, all the other currencies except the greenback posted higher including a new contract high for the Euro. Given that they stopped posting full comparison numbers between all the currencies, I can't fully diagram how it all works out.

http://www.thenation.com/doc/20021230/hiro20021216

The expected friendliness of the succeeding regime with Washington would not automatically translate into cancellation of contracts with the petroleum corporations of France, Russia, China, India, Canada, Spain, the Netherlands, Vietnam and many others

Apparently, however, what I'm wrong on is that it's US companies only.

http://edition.cnn.com/2008/BUSINESS/06/30/iraq.oil/index.html

down 27% on the day.

:donut: and lurkers. Gee, I take a few days off and things turn to shit around here:wagsfinger:

What to do, what to do.........

I was more than annoyed that some of the talking heads have been taking up Phil Graham's really stupid assertion that this is all in our heads and that we are a bunch of whiners......OK, I will give him points for saying that we are whinners because if most of this nations middle class and working poor (which now days includes over 75% of this nation) were paying attention, Phil, George, Dick, Alan, and the lot would hanging from a tall tree by a short rope. I think Phil needs to be thanking his lucky stars that folks are just whining.

Anyway, my :rant: for today.....There was a consumer psychologist (yes, what a useless occupation title-we have plenty of folks in need of real psych help-and she wants to convince us the solution is more stuff?). Anyway, she was on the Sunday ABC morning program saying that we had gotten use to a period of good economic times and weren't use to a downturn ya da ya da ya da. Of course they kept adding a half assed disclaimer that of course there were some folks that really were having a tough time and things like increased prices for gas and food were making it tough for some folks but it isn't as bad as we think. The media makes it worse by telling these anecdotal stories, people start spending less out of fear, and next thing you know, we really are in bad circumstances. It was total bull shit. :puffpiece:

This thread, and the folks on it have been calling bull shit on the media since Bush's first "jobless recovery", when the red ink first started hitting the treasury books, you remember, when we were first told that deficits don't matter. And the foreclosure and real estate debacle-this was one of the first places that consistently raise the alarm. The broadcasters evan as late as today were saying there was no way to tell if a bank was treading water-when even here on an almost weekly basis, a website is posted for us and we were warned. The media only started printing a few stories this March and it has slowly been escalating since. They so conveniently forget that the average worker wages have been stagnant and/or losing ground since the seventies. Some of us happen to be long in the tooth and can remember some of the market down turns and while this has many similarities-the root problems are deeper and the environment worse than the 80's. I have experienced the crash in the 80's and the dot com bust. I am not afraid, but I have been and remain very concerned. I know runs and panics, and I understand the psychology behind it.....but that Chickie needs to get a refund on her degree.

We have been lied to....first by telling us nothing is wrong an now by telling us it is our fault for thinking it is worse than it is. Well, I live in Houston Texas where thing are purported to be better than most of the country-but if we are honest with ourselves-it's not all that great. In this 'paradise', we are struggling to keep our heads above water. How great is this economy when a school nurse and a security guard husband living in a fifth wheel because that is what they can realistically afford become the American dream. We thank God we didn't fall into the ARM trap because that is all we were offered. If we make it through this, and I know we will......It is because we didn't buy into some of these notions or fall for the media or government bull shit.

I will open the pool today. I think we are bearing down hard on the 11000-11100 PIN. The gov will fight hard on this one because it is so important to keep up the pretension. I liken i to a fan dance that I once saw (the great Sally Rand). She was fairly old then but she moved about gracefully, careful to cover herself with those large plumed fans. You knew she was naked under it all, and you might see a tantalizing bit of skin now and again, but it would be an elbow or shoulder or leg, nothing more. The government is naked, but they don't want us to how bare they really are. They'll continue to twirl and twist-careful to cover their naughty bits....but those of us here have known for some time that they are naked and can't hold up the fans and dance for much longer. And It will be us that will be left to pay the musicians.

Happy hunting and watch out for the bears......

I'd like to make a revision on my date. I noticed August 23 is a Saturday, so just move me up one day to the 22nd please.

Thanks

Where ya be matie....Have fun in what ever port ya find yourself in.

Flying out of town this week-end. Hope there's an airline to fly back on!

not that I was straining to listen, but with less than 50ft between our house and the knuckledragger, plus knuckledragger doesn't know how to talk at a normal volume...

ennywhooooo... knuckledragger was complaining to one of his buddies about how he was laid off, (he was driving truck, the company cut back on drivers because of cost of gas), and he was also complaing about how he can't sell his house because the housing market is sooooo bad...

next he went into his usual rant about gays, blacks, hispanics - basically anyone that wasn't white.

all this was par for the course as to what we hear on a regular basis.

then... I almost choked

he started mentioned the november election... he said he was voting for the "n_______", and not the bald guy, because if the bald guy gets in we're screwed...

:wow:

One VOTE at a time.

racist knuckledragger acquaintance says to me this morning, "Y'know, I wonder how many people who say they're supporting Obama will get in the voting booth and then just say they can't really vote for a black guy. Y'know, there are a lot of racists still around." (It's a mark of improvement that he said "black guy" instead of, you know, ******.)

So I calmly said, "Well, if they vote for McCain and he gets in, I don't want to hear a word of complaint when the economy goes to even worse crap, the war expands to Iran, Syria, Libya, Turkey, Pakistan, Russia, China, and Korea, gasoline hits $18 a gallon if you can even buy it, and this country erupts in a violent revolution that makes 1918 Russia look like a marshmallow roast. McCain is senile, and he's the puppet of the people who got us where we are now."

RKD said, "I think you're right. I had a hard time talkin' myself into liking Hillary 'cause I just didn't want a black guy in there, but McCain really scares me. He REALLY scares me."

that can count as progress. Obama is winning among my more red neck family members. Mom still likes McCain but I'm not worried....She doesn't vote....she launches into this poll tax story, even though we told her the SCOTUS outlawed that, she still uses that as her excuse:eyes: I just smile, knowing my vote will count more than her opinion.

it will be at the same time my father says he's voting for obama...

for those not familiar with my dad - he makes limbaugh look liberal

01. National City says no unusual depositor or creditor activity
12:01 PM ET, Jul 14, 2008

03. National City shares fall 27%, to $3.21
11:59 AM ET, Jul 14, 2008

04. National City shares halted for pending news
11:59 AM ET, Jul 14, 2008

Pssst....NCB has cooties. Don't tell anyone.

:hide:

Nothing is working. Their quick fixes, which even a few months ago bought them weeks worth of time, now only buy hours. Watching the stock market obsessively as I have for the past couple of weeks (remind me to work over the summer next year...) makes me think that in this atmosphere it will only take ONE PIECE of very bad news to this to crash.

Sooner means fewer stupid things done, less delay to start doing the smart things.

Sooner means impeachment in the bag, plus conviction, removal, and the Hague.

Sooner means the condo conversion comes to an abrupt halt, also.

The suspense is killing us all and everything else.

Sound the klaxon: Ahooga! Dive! Dive! Dive!






(Demeter has had very little sleep due to insane working schedule...)

SAO PAULO, July 14 (Reuters) - Brazil's stock market had its biggest one-day gain in two weeks on Monday, led by shares of mining company Vale and brewer AmBev, and the country's currency strengthened, buoyed by rising global markets.

The Bovespa index .BVSP of the Sao Paulo stock exchange rose 1.55 percent to 61,088.11, heading for its biggest rise since a 2.6 percent jump on June 25. But the index is down more than 6 percent so far this month as financial worries abroad have kept global stock markets under pressure.

Vale shares gained as investors snapped them up ahead of a $15 billion stock offering this week. Shares of AmBev surged more than 5 percent after its parent, InBev (INTB.BR: Quote, Profile, Research, Stock Buzz), sealed a deal to buy Anheuser-Busch (BUD.N: Quote, Profile, Research, Stock Buzz) for about $50 billion to form the world's largest brewer.

Brazil's real BRBY firmed 0.25 percent against the U.S. dollar to nearly 1.6 reais per dollar. Local markets took a boost from U.S. measures over the weekend to rescue mortgage finance companies Fannie Mae (FNM.N: Quote, Profile, Research, Stock Buzz) and Freddie Mac (FRE.N: Quote, Profile, Research, Stock Buzz) that eased concerns over any worsening of the credit crunch.

"Finally, there was some positive news in the market," said Carlos Alberto Ribeiro, a director at brokerage Novacao. "The whole world breathed a sigh of relief and took advantage of that news to rise."

Interest rate futures <0#DIJ:> on the BM&F commodities and futures exchange in Sao Paulo were mostly higher after a weekly central bank survey showed economists raised their forecast for 2008 inflation to 6.48 percent from 6.40 percent a week ago.

/... http://www.reuters.com/article/marketsNews/idCNN1442401720080714?rpc=44

SAO PAULO, July 14 (Reuters) - Brazil's central bank said it will hold an auction on Monday to buy dollars on the spot foreign exchange market as part of an ongoing effort to boost international reserves.

Shortly after the announcement, the Brazilian real BRBY traded 0.25 percent stronger at 1.598 per dollar.

The central bank has been buying dollars almost daily since October, helping lift Brazil's reserves to more than $200 billion.

/. http://www.reuters.com/article/marketsNews/idINN1442962220080714?rpc=44

Just a word of caution....this is an above ground pool, the seams are starting to buckle a bit and I can't keep it filled with as much. Enter with caution......


Guess the date the DJIA rolls back to the level it was when the chimp took office-10,578.24. You can revise your dates up until Labour Day (the working man's holiday)or the DJIA hits(IMPORTANT CHANGE) 10700 (got to have a cut off). Anyone can join, just give a date and your reasoning for that date. Not the change on the cut off. That should make for a good horse race. I will check the post date/time for last minute posters but those that guessed the date way in advance get extra points. The earlier posters are at the top in the cases of multiple guesses on the same day.

bahrbearian.....7/1
finnfan.....7/2
InkAddict.....7/3
Karenia.....7/8
UIA.....7/15
Alterfurz.....7/22
Karenina.....7/25
Roland99.....7/28
TOJ.....7/31 or the day after Bush or Israel invades Iran, some folks just have to have their floaties
Abelenkpe.....8/2
GhostDao.....8/5
Kineneb.....8/8
Inkaddict.....8/14
Talking Dog.....8/17
DWellwer.....8/19
Dr.Phool.....8/23
Muad dib.....8/22
Nadinebrezezinski.....9/1
Radfringe.....9/1
MattSh.....9/2
Tansy Gold.....9/2 Honoring me on my birthday. I guess I won't be getting cake and a pony if this date wins
Kineneb.....9/4 taking advantage of bet spreading
Prag.....9/5
MoJo Rabbit.....9/5
Kicksana.....9/8
JuneBourder.....9/4
MuleBoy(aka hiz honna da mayor).....9/11
Nickster.....9/12
Ozy.....9/19
AnneD..... 9/19 Like the triple witching thang.
Demeter.....9/21
Ozone man.....9/23
JuneBourder.....9/29
Birthmark....10/10
Demreading DU.....10/16
TansyGold.....10/13
Roland99.....10/17, you have 2 dates, are they correct?
AnneD....10/24
Neshanic.....10/24
MsLeopard.....10/31
Wordpix.....11/3
Passingfair.....11/4
Ship wrack.....11/5
Wednesdays.....1/16/2009 your optimism is so refreshing.



Remember-you can change the dates as we learn more. If your date isn't on the list, e-mail me and I'll add it the next time I post. I erased expired dates so you can guess again. I post about one a week-more often the closer we get to the number. The winner get the praise and admiration of those on the Stock Watch Thread. We have also kicked in for a years worth of bragging rights and Karl Rove as you own pool boy if we can find Speedos to fit. There is still time to place your bets.....And please-no Reggie bars in the pool.

About, if the pool locks when the Dow hits 11000 during a trading session (as it did last Friday) or if it
locks when the Dow closes at/below 11000?

due to the efforts of the PPT-I think 10700 should be our limit. I think I posted it one but it didn't get into the template......will do that right now.

but I believe the spinning plates will hit the concrete THIS MONTH. Short call: July 25.

My take is that it'll happen before Amurca is done with it's summer vacation. They'll be too busy sleeping off their cookout comas to notice.

But seriously, the closer you get to Labor day most people probably won't be concerning themselves with all the bad going on and will be ignoring the inevitable. That would be a perfect time for * to LIHOP.

I think there will be a dead-cat bounce later this week and then reality is going to kick back HARD early next week. Hope I'm wrong, though.

And I'd like to stick with it.

Washington Mutual and National City.. not good!

I wonder if there's going to be a run on the banks?

FRE FREDDIE MAC 6.12 12:37PM ET 1.63 (21.03%) 159,684,494 Chart, Profile, More
FNM FANNIE MAE 9.67 12:37PM ET 0.58 (5.66%) 129,932,305 Chart, Profile, More
SPY S&P DEP RECEIPTS 122.83 12:37PM ET 1.01 (0.82%) 99,638,270 Chart, Profile, More
QQQQ POWERSHARES QQQ TR 1 44.21 12:37PM ET 0.35 (0.79%) 97,892,687 Chart, Profile, More
WM WASHINGTON MUTUAL 3.49 12:37PM ET 1.46 (29.49%) 90,975,625 Chart, Profile, More
XLF FINANCIAL SEL SPDR 18.03 12:37PM ET 0.65 (3.48%) 88,162,931 Chart, Profile, More
LEH LEHMAN BROS HLD 13.64 12:37PM ET 0.79 (5.47%) 64,356,883 Chart, Profile, More
WB WACHOVIA CP 10.03 12:37PM ET 1.51 (13.08%) 46,729,069 Chart, Profile, More
BAC BK OF AMERICA CP 20.73 12:37PM ET 0.94 (4.34%) 43,948,879 Chart, Profile, More
NCC NATL CITY CP 3.28 12:37PM ET 1.14 (25.75%) 43,070,328 Chart, Profile, More
C CITIGROUP INC 15.45 12:37PM ET 0.74 (4.57%) 42,228,861 Chart, Profile, More
http://finance.yahoo.com/actives?e=us

:hide:

When was that? I can't remember. But I'm pretty sure a BUSH was in office!

May just be a rumor, however.

It all seems to be a figment of my imagination or so I'm told.

:hi:

and yes. I have frequently likened our current economy to the Real Estate bust of the late 80's, that lead to the S&L going under to our current situation-which is why I laugh when they say we will be recovered by next year. We also had a spike in gas prices prior to all this unfolding and a drastic spike in food prices. But Bush I was in charge during the S&L Scandal and Clinton won on the 'it's the economy' platform.

Guess I date myself.

I'd run for the hills.

Like UBS has anything to brag about. What a joke.
http://finance.yahoo.com/q?s=WB

"The market can't decide, so it's has to go to a psychologist". lol

Sez we're all crazy. It's just all in our heads.

That'll lern 'em. :silly:

I stuck a bunch of money in there a couple of weeks ago.

Well below the FDIC limit though.

M&T Bank Falls After Second-Quarter Profit Slumps 25% (Update3)
By Linda Shen
http://www.bloomberg.com/apps/news?pid=20601103&sid=acihIM.Zs5pQ&refer=us

July 14 (Bloomberg) -- M&T Bank Corp., the lender whose second-largest shareholder is Berkshire Hathaway Inc., slumped the most since 1987 in New York trading after second-quarter profit plunged 25 percent on losses tied to mortgages.

Net income declined to $160.3 million, or $1.44 a share, from $214.2 million, or $1.95, in the same period a year ago, the Buffalo, New York-based bank said today in a statement.

Banks are setting aside more to cover bad debts as builders default on commercial mortgages because they're unable to complete projects amid the worst U.S. housing slump since the Great Depression. M&T said ``unfavorable conditions'' in residential real estate have driven up bad loans.

``M&T is not immune to the effects of the higher credit costs evident throughout the banking industry,'' Chief Financial Officer Rene Jones said in the statement. Even so, ``we are fortunate to have little exposure to some of the high-risk of problem markets around the country,'' Jones said in a conference call today.

M&T fell $8.78, or 12.6 percent, to $60.98 at 11:20 a.m. in New York Stock Exchange composite trading. Profit excluding merger expenses and other items was $1.53 a share, down 25 percent from $2.04 a year earlier. Fourteen analysts surveyed by Bloomberg estimated adjusted profit of $1.55 a share

The market will tank for sure now.

I could postpone it for a week, I guess.

eom

A. Dollar stronger than ever?

B. Market stronger than 1929?

C. He's a strong Dollar and Market guy?

D. Opening those drillin sites will help the economy.



D. All of the above and embarrass himself as usual?

"Bad Demcrats."

"Bad US Congress."

"Oil exploitation Exploration good."

leaving ones fly open. Proving ones stupidity involves opening ones mouth and removing all doubt. In Bush's presidency he has both embarrassed himself and proved his stupidity.:eyes:

. . . .that he could walk up to the podium with his fly open, his **** hanging out, and piss all over himself and he wouldn't bat an eye.

And neither would the media covering it.



Tansy Gold, in a REALLY foul mood today.

is to drill for oil offshore that we won't see for several years if ever...

"We won't have to import more fully refined petroleum products like gasoline."

Ummm, refined product EXPORTS, such as diesel and gasoline are up 33% over last year. Up to 1.8 million barrels PER DAY!

IndyMac borrowers line up in Calif. to withdraw their cash
Mon Jul 14, 2008 12:52pm EDT
By Gina Keating
http://www.reuters.com/article/marketsNews/idUSN1443827020080714

PASADENA, Calif., July 14 (Reuters) - IndyMac Bancorp Inc (IMB.N: Quote, Profile, Research, Stock Buzz) customers lined up outside a branch at the company's headquarters on Monday, hoping to withdraw their money after regulators seized what was once one of the largest mortgage lenders in the United States.

Several hundred people arrived around 4 a.m., five hours before the Federal Deposit Insurance Corp planned to open that branch.

---snip---

"I have $360,000 in this bank, and I was misled by this bank," said Robert Clark, a Glendale resident who was waiting on line. "I gave the names of my mother, my sister and my brother on the account so I thought I would be insured. I don't know what to do. I really don't know what to do."

John Bovenzi, the FDIC's chief operating officer, talked with some customers and tried to reassure them as they waited for the doors to open.

"This bank is as safe and as sound as any bank in the country right now," he told one depositor. Bovenzi added that the FDIC was "going to get as much money as we can" to compensate investors with uninsured deposits.

Why do I think he's actually telling the truth? :scared:

>>>>Bovenzi added that the FDIC was "going to get as much money as we can" to compensate investors with uninsured deposits.<<<<

What is the FDIC doing compensating investors with UNinsured deposits?

As for Mr. Clark with his $360,000, all I can say is, "Hey, man, be glad you had $360,000 and maybe you'll get back $100,000 or a little more. There's a whole lotta people in this country who don't have that, you greedy little bastard."



Tansy Gold, who gets really pissed when rich people whine

That's great for Mr. Clark but what if there are a lot more bank failures? They shouldn't be throwing money around.

Stewart Enterprises, the owner of more than 200 funeral homes and 100 cemeteries in the U.S. and Puerto Rico, advanced as much as 21 percent in Nasdaq trading after rejecting a buyout offer from Houston-based Service Corp. International.

Stewart rose $1.41, or 20 percent, to $8.40 at 9:47 a.m. New York time on the Nasdaq Stock Market, after reaching $8.45 earlier, for the biggest intraday gain since January 2001. Shares of the Jefferson, La.-based company were down 21 percent this year before today.

Service Corp., which owned more than 1,300 funeral homes and 350 cemeteries as of March 31, offered at least $9.50 a share in cash for Stewart, according to a regulatory filing. Stewart rejected the offer as "inadequate" in a letter dated July 7, according to today's filing.

"Current conditions are ideal for a combination of our companies," Service Corp. wrote in a June 25 letter to Stewart's board included in the filing. The offer could increase to $10.25 to $11.25 a share after access to "non-public, non-competitively sensitive overhead and trust information," Service Corp. said.


/www.chron.com/disp/story.mpl/business/5886973.html


Somehow...I think this might be significant in the future somehow.

MCALLEN — The Food and Drug Administration's attempt to target a source for the nationwide salmonella outbreak has effectively shut down Texas border tomato traffic — and that of cilantro, jalapeños, and other peppers and produce, even though tainted ones have yet to be found in Mexico.

Industry losses, estimated at $250 million for the initially implicated tomatoes alone, are mounting as the FDA widens its probe. The standstill at the border is spreading through a distribution chain that reaches from the fields of Coahuila, Mexico, to wholesale markets in cities like Atlanta and Chicago.

It's evident in the rows of packing sheds in McAllen that normally bustle this time of year with northbound shipments of tomatoes and peppers.

Cold storage rooms stand empty. Conveyor belts are still. Owners pace their bare warehouses fielding cell phone calls from customs brokers for word on whether they can move what rapidly perishing product they still have.

Meanwhile, idle workers wonder how long they'll have jobs.

more......

www.chron.com/disp/story.mpl/business/5886491.html

I don't know how this will affect the nation.....but we are looking at major shortages here in Texas.

edited to add....I didn't mean to post this article here....but in some perverse way it seems to fit.

I am hoping the culprit is cilantro.....I hate that weed. Taste like soap to my taste buds. It is a noxious weed to most Tex Mex cooking. And just try ordering a meal without it. It's like trying to get soft scrambled eggs in a Mexican breakfast place....it is hopeless.

that was another reason why I didn't vote for the little prick.

Barry Spadoni first bought a battery-powered TV after the Northridge earthquake in 1994, when his home in Los Angeles’ San Fernando Valley was without electricity for 10 days.

He later upgraded to a color model to stay on top of news during power outages — and follow local college football games from high in the stands.

“Having that little TV stuck in the drawer, where you just have to put in batteries ... that’s very important if it’s a prolonged outage,” said Spadoni, a Wachovia financial adviser.

But come February, Spadoni’s hand-held TV and the millions of others in U.S. homes will face their own permanent outage.

Almost all the battery-powered televisions stashed in drawers, closets and garages in case of emergency will be rendered useless when broadcasters switch to digital-only signals. And right now there aren’t many options for replacing them.

more.....
www.chron.com/disp/story.mpl/business/5883936.html

Here in hurricane country....that news sucks big time....

Given there is such a big market for it.

NEW YORK — Women may not earn as much as men or fly up the corporate ladder as quickly, but they get the last laugh since they live longer. Right?

As it turns out, women probably aren't saving enough to bankroll those extra years in style. They invest more conservatively, start saving later and are more likely to be in and out of the work force, according to a study released last week by Hewitt Associates, a human resources consulting firm.

Suddenly, retirement isn't looking so rosy.

Women live an average of 22 years after retirement versus 19 years for men, and medical costs are rising, so women will need to save 2 percent more than men every year over 30 years to maintain their standard of living upon retirement, the study found.

more...

www.chron.com/disp/story.mpl/business/5883937.html

More cheery news gals.....

THOMASVILLE, ALA. — Residents in once-quiet Thomasville have started complaining about traffic jams on Route 43, which runs right through the town.

Much of the traffic is coming from shoppers, squeezed by $4-per-gallon gasoline, who are staying closer to home instead of driving 100 miles each way to the nearest malls in Mobile or Montgomery.

"I just don't drive as much," says Herman Heaton, a 72-year-old retired lumber mill worker, leaning against a Chevy Silverado pickup that costs him $80 to fill up. "We don't go to Mobile as much as we used to for shopping." Heaton said he spends about $600 a month on gas, about 10 percent of his income and about double what he spent last year.

So now he says he's shopping locally.

Many stores in rural towns — from small independent shops to local chains — are starting to enjoy a little life after years of seeing customers bypass them for distant malls. While it may not reverse the decades-long decline of small-town shopping, it could lead national mall developers and merchants to rethink where to build and challenge a basic tenet of retailing: Build, and shoppers will come from miles away.

more.....

www.chron.com/disp/story.mpl/business/5883905.html

This might be a ray of hope....

Same thing Friday.

no one wants to be left holding the bag. Monday gives you time to do a sucker rally.