STOCK MARKET WATCH, Friday October 9

Source: du

STOCK MARKET WATCH, Friday October 9, 2009

Bush Administration Officials Under Indictment = 2
Financial Sector Officials In Prison = 6

AT THE CLOSING BELL ON October 8, 2009

Dow... 9,786.87 +61.29 (+0.63%)
Nasdaq... 2,123.93 +13.60 (+0.64%)
S&P 500... 1,065.48 +7.90 (+0.75%)
Gold future... 1,056 +11.90 (+1.14%)
10-Yr Bond... 3.25 +0.07 (+2.20%)
30-Year Bond 4.09 +0.09 (+2.22%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie, Silver and US$

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This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.

Read more: du

Signs of Trouble
BY MICHAEL PANZNER

The latest results of Washington’s spending-and-borrowing spree are in and, as you might expect, they don’t look pretty. According to the Congressional Budget Office, the U.S. budget deficit hit a record $1.4 trillion in the fiscal year just ended; at 9.9% of gross domestic product, it was the largest such shortfall since 1945. In addition, September’s monthly deficit was the 12th in a row, a losing streak that has not been seen in least four decades.

-see chart-

More ominous, perhaps, is the fact that the FY 2009 deficit turned out to be just over 40% of outlays. According to research highlighted by Hayman Advisors in their October Letter, the fact that such a sizeable share of government spending is being financed with borrowed money has, historically at least, been a harbinger of trouble ahead:

There have been 28 episodes of hyperinflation of national economies in the 20th century, with 20 occurring after 1980. Peter Bernholz (Professor Emeritus of Economics in the Center for Economics and Business (WWZ) at the University of Basel, Switzerland) has spent his career examining the intertwined worlds of politics and economics with special attention given to money. In his most recent book, Monetary Regimes and Inflation: History, Economic and Political Relationships, Bernholz analyzes the 12 largest episodes of hyperinflations - all of which were caused by financing huge public budget deficits through money creation. His conclusion: the tipping point for hyperinflation occurs when the government's deficit exceed 40% of its expenditures.

Given the extremely bad habits Washington has adopted during the past two years, one has to wonder, as Hayman Managing Partner Kyle Bass puts is, whether America has “reached the critical tipping point”?

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

08:30 Trade Balance Aug
Briefing.com -31.0B
Consensus -33.0B
Prior -32.0B

http://www.briefing.com/Investor/Public/Calendars/EconomicCalendar.htm

U.S. Aug. trade gap lower than $33.6 bln expected
8:30am Today

U.S. Aug. real crude imports fall to 10-year low
8:30am Today

U.S. Aug. real trade gap falls 2.7%
8:30am Today

U.S. Aug. imports fall 0.6% to $158.9 billion
8:30am Today

U.S. Aug. exports rise 0.2% to $128.2 billion
8:30am Today

U.S. Aug. trade gap falls to $30.7 billion
8:30am Today

SINGAPORE – Oil prices fell to near $71 a barrel Friday in Asia, giving up part of the previous day's big gains, as the U.S. dollar rebounded.

Benchmark crude for November delivery was down 49 cents at $71.20 by midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract added $2.12 to settle at $71.69 on Thursday.

.....
"People are using crude and gold as an inflation hedge because the U.S. is just printing money," said Clarence Chu, a trader at market maker Hudson Capital Energy in Singapore. "There's definitely been a negative correlation between the dollar and oil."

.....
In other Nymex trading, heating oil rose 1.79 cents to $1.83 a gallon. Gasoline for November delivery gained 1.43 cents to $1.77 a gallon. Natural gas for November delivery was steady at $4.96 per 1,000 cubic feet.

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

Saudis ask for aid if world cuts dependence on oil
http://www.google.com/hostednews/ap/article/ALeqM5gyy9tlD4hRjJD2wQ__gxvo_IzYEgD9B6QSRG0


There are plenty of needy countries at the U.N. climate talks in Bangkok that make the case they need financial assistance to adapt to the impacts of global warming. Then there are the Saudis.

Saudi Arabia has led a quiet campaign during these and other negotiations — demanding behind closed doors that oil-producing nations get special financial assistance if a new climate pact calls for substantial reductions in the use of fossil fuels . . .

does the pumping of the next bubble continue?

:donut: :donut: :donut:
I anticipate a selloff. Did you notice that everything but the dollar has been going up in recent days? Gold, oil, stocks (even crappy stocks) have gone up; 10-year and 30-year bonds, too, have seen a huge rise in demand to prompt falling yields. What investment worth $1at face value would sell for $3.01? Maybe that's what the Fed offers for T-notes these days.

A three day weekend is ahead. I'm sure that many will want to cash out.

It's a Fed holiday, but not a Wall St. one.

Good to know. My school system is closed that day as well as state offices. So I thought everything would be shuttered.

I am glad you said so. It would be a harsh rebuke to bear if this thread were not posted on a trading day.

You know we'd cover if you needed it...

you were having computer problems. Might razz you a bit, but never rebuke you :hug:

U.S. stock futures weaker on Bernanke hike pledge

LONDON (MarketWatch) -- U.S. stock futures pointed to a weaker start Friday as Federal Reserve Chairman Ben Bernanke said that the unprecedented loose monetary policy will have to come to an end.

S&P 500 futures fell 3.1 points to 1,060.70 and Nasdaq 100 futures fell 8 points to 1,708.50. Futures on the Dow Jones Industrial Average declined 21 points.

.....
Bernanke late Thursday said the Fed will reverse course and tighten policy when the economic outlook improves sufficiently, though he said accommodative policy will still be needed for an extended period.

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People will try to cash out after the runup because they want money. That's obvious. To apply causation to something Bernanke said (that may not take place for months) is just intellectually dishonest.

to save the greenback, :kaboom: Mortgages rise from their lows, retirements loose value (stocks), more defaults at the commercial level, more, more...

Sure do wish those thoughts had entered his mind when he mortgaged us unwashed masses for the sake of his buddies. :grr:

From Ritholtz:

Over the past few months, I have noted our current bullish posture, along with the reasons for it.

Earlier this week, I noted the disconnect between the economy/markets, and in that post, I promised to further explain my views.

.....
2) Hated Rally: I have noted previously that this is the most hated rally in Wall Street history. Many people — both pros and individuals — all have reasons as to why it must end badly: PPT, hyper-inflation, bad economy, etc.

Most bull moves do not end when they are hated, they come to a halt and reverse when they become over-owned and over-loved.

We are not there yet.

More at the link above...

Ritholtz gets it too.

WASHINGTON (Reuters) – The number of U.S. workers filing new jobless claims hit a 9-month low last week, and retailers posted their first monthly sales gain in over a year, easing fears recovery from recession would be unsustainable.

The Labor Department on Thursday said first-time applications for unemployment benefits dropped 33,000 to a seasonally adjusted 521,000 last week, the lowest level since early January. That was below market expectations for 540,000.

.....
The jobless claims report was a relief after data last week showed U.S. employers cut 263,000 jobs in September, far more than the market was expecting.

Data suggests the economy started growing in the third quarter after a recession that started in December 2007, but a persistently weak labor market is casting doubts over the strength and sustainability of recovery.

.....
In a sign the labor market was healing, the four-week moving average for new claims fell 9,000 to 539,750 last week, declining for a fifth straight week.

http://news.yahoo.com/s/nm/20091008/bs_nm/us_usa_economy

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This information on the jobless claims is a matter of perspective. We are firmly entrenched in horrible, painful jobless numbers. We need to create in excess of 150k jobs per month just to keep pace with population growth. So this tiny drop in unemployment claims is nothing to celebrate.

By Robert Schmidt

Oct. 9 (Bloomberg) -- The group Congress created to oversee the U.S.’s $700 billion financial bailout said the government needs to increase its efforts to help struggling homeowners modify their mortgages.

A split Congressional Oversight Panel said in a report issued today that it has doubts that the Treasury Department’s $50 billion loan-modification program will help prevent an estimated 3 million to 4 million foreclosures. The group’s two Republican members dissented from the Democratic appointees’ findings.

“Rising unemployment, generally flat or even falling home prices and impending mortgage-rate resets threaten to cast millions more out of their homes,” the report said. “The panel urges Treasury to reconsider the scope, scalability and permanence of the programs designed to minimize the economic impact of foreclosures and consider whether new programs or program enhancements could be adopted.”

Republican member Jeb Hensarling, a congressman from Texas, issued a dissent.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aYG9i40uKL0M

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Did they put the Texas Republican on the panel for comic relief? Of course he is going to piss in the punch bowl.

http://www.ft.com/cms/s/0/d07e29f2-b46e-11de-bec8-00144feab49a.html

NEW YORK, Oct 8 (Reuters) - The 85-year-old son of the late New York City philanthropist and socialite Brooke Astor was convicted on Thursday of looting his mother’s estate while she was suffering from Alzheimer’s disease.

Anthony Marshall, Astor’s only son, was charged in 2007 with grand larceny, criminal possession of stolen property and falsifying business reports tied to his handling of his mother’s fortune, estimated to be worth around $200 million...A New York state court jury convicted Marshall on 14 of 16 counts after deliberating for 12 days, during which time jurors told the judge of heated debate that left some feeling threatened. The trial lasted 19 weeks.

Marshall, who remains free on bail, could spend the rest of his life in prison. He faces a sentence of up to 25 years.

Estate lawyer Francis Morrissey, 66, was also convicted on five counts including scheming to defraud Astor and forgery. He faces up to seven years in prison.

...Astor died in August 2007 at age 105...In Astor’s last years, a court ordered her care be taken away from Marshall after he was accused by his son of keeping her in squalid conditions. Marshall denied the accusations...

http://www.ft.com/cms/s/0/08ca4832-b36a-11de-ae8d-00144feab49a.html



The falling US dollar is giving ammunition to the critics of the Obama administration and fuelling broader concerns about the potential erosion of America’s reserve currency status.

Republican politicians have highlighted the dollar’s slide as evidence of waning US power.


Sarah Palin, the former vice-presidential Republican candidate, on Wednesday sought to link the dollar decline to rising US indebtedness and dependence on foreign oil. “We can see the effect of this in the price of gold, which hit a record high today in response to fears about the weakened dollar,” she wrote on her Facebook page.

With other nations also expressing concern about dollar weakness, the administration is at pains to emphasise that it understands the responsibilities that come with issuing the world’s reserve currency and will live up to them.

“It is very important to the United States that we continue to have a strong dollar,” Tim Geithner, Treasury secretary, said at the weekend. “We recognise that the dollar’s important role in the system conveys special burdens and responsibilities on us and we are going to do everything necessary to make sure we sustain confidence.”

Angst about the dollar – which has fallen 11.5 per cent on a trade-weighted basis over the past six months – extends beyond ideological conservative political circles.

Last week, Robert Zoellick, president of the World Bank, warned that “the United States would be mistaken to take for granted the dollar’s place as the world’s predominant reserve currency.”

Much of today’s debate echoes the traditional political response in the US whenever the currency depreciates. But it is now accompanied by warnings from America’s creditors, many of which are widely rumoured to be eyeing large purchases of US real assets such as property and companies.

“The dollar has always been a testosterone issue among America’s political classes,” said Norm Ornstein, a veteran analyst at the conservative American Enterprise Institute.

“This time there may be a legitimate debate to be had over the dollar’s reserve status, but Sarah Palin is not qualified to participate in it.”

While the latest swoon in the dollar is attracting attention, analysts say that it needs to be put in context. In trade-weighted terms, the dollar is essentially back to where it was at the start of the financial crisis on August 9, 2007, according to Federal Reserve data.

While the price of gold has gone up, financial market measures of inflation expectations have not. The yield on the 10-year note was trading at 3.18 per cent on Wednesday. Indeed, analysts say that the dollar’s slide stems more from investors’ growing appetite for risk and the prospects of interest rate rises elsewhere.

“The first order reason for the decline in the dollar has been the normalisation of markets,” said Ken Rogoff, a Harvard professor and former IMF chief economist. “The financial crisis probably has brought forward the day when the dollar is no longer dominant – but maybe from 75 years to 40 years.”

today if we had not squandered trillions of dollars, igniting a currency and budget crisis, while chasing after dark-skinned bogeymen during the Bush junta's eight years in power?

The GOP would use it to start a war....or three.

2009 was a horrible year for the U.S. financial system. The World Economic Forum's (WEF) latest rankings slammed American finance, dropping it to the #3 slot. London took #1, which some may have expected.

Yet the real stunner was Australia. It jumped from #11 to #2, blowing past the U.S.

Singapore jumped from #10 to #4 as well. The way things are going, it wouldn't be surprising if Singapore overtook the U.S. next year.

Australia Beats US

Shocked? Actually, their arguments against the U.S. financial system make a lot of sense. Many smaller countries have far more stable systems.

http://www.businessinsider.com/london-blows-past-new-york-as-the-1-financial-center-2009-10


Guess this answers your question. We are now number three, the Aussies sped past us.

http://www.ft.com/cms/s/0/1e894c54-b40f-11de-98ec-00144feab49a.html

Asian central banks intervened heavily in the currency markets on Thursday to stem the appreciation of their currencies against the US dollar amid fears that their exports could be losing ground against China.

The mainly south-east Asian countries have been spurred to defend the competitiveness of their currencies by China’s decision to in effect re-peg the renminbi to the dollar since July last year.

Simon Derrick, at Bank of New York Mellon in London, said: “Other Asian central banks outside China are naturally looking to aggressively defend their competitive edge against undesirable currency strength as the dollar weakens.”

After allowing the renminbi to appreciate by about 20 per against the US dollar from mid-2005, Beijing re-pegged its currency to the greenback when export growth contracted.

The greenback hit one-year lows against a raft of regional currencies. The dollar index, which tracks its value against a basket of six main currencies, hit a 14-month low in afternoon trading in New York .

........................
Gold prices hit an all-time high for the third day in a row, on the dollar’s weakness. Base metals such as aluminium and copper jumped 4 per cent, while crude oil surged almost $3 to more than $70 a barrel.

The central banks identified by traders as substantial buyers of US dollars included Thailand, Malaysia and Taiwan. Hong Kong and Singapore, which both have managed currency regimes, were also buyers.

The moves to limit Asian currency appreciation is ammunition for those who warn that the new Group of 20 framework for strong and balanced growth is toothless. Less than a week after the world’s finance ministers and central bankers agreed to foster more balanced world economic growth in Istanbul, Asian officials have intervened to prevent exchange rates playing their part in the process.

However, traders said that the central bank interventions appeared to be aimed at controlling the pace at which the US dollar declines rather than solely to stop Asian currencies appreciating.

The Obama administration has not altered its refrain that it believes in a “strong dollar” but is seen as unlikely to intervene in currency markets, particularly as the US Treasury recognises the trade-weighted value is similar to where it was two years ago.

WHEN US POLITICIANS COME OUT STRONGLY FOR STRONG DOLLAR, SELL!!!

http://www.ft.com/cms/s/0/16c1dac4-b45d-11de-bec8-00144feab49a.html

The Federal Reserve has begun conducting small-scale tests of trades called “reverse repos” on Wall Street that would enable it to drain cash from the financial system once it decides to roll back its current extraordinarily loose monetary policy.

In a reverse repo – shorthand for a “reverse repurchase agreement” – the Fed sells assets such as Treasury securities to dealers for cash with an agreement to buy them back at a slightly higher price at a later date. In the process, bank reserves are drained from the financial system.

This technique helps the Fed maintain its short-term interest rate at a desired level. In December 2008, when the central bank established a target range for the federal funds rate of 0 to 0.25 per cent, it stopped conducting reverse repos to influence rates.

However, dealers say in recent days, the Fed has conducted reverse repo tests in the so-called tri-party repurchase market, in which custodian banks such as Bank of New York and JP Morgan act as intermediaries.

The tests are not a sign that the Fed is about to drain reserves on a large scale. That would require a decision by the Federal Open Market Committee to scale back its generous liquidity support for the financial system. Such a move is not expected before 2010 at the earliest.

In remarks prepared for delivery last night in Washington, Ben Bernanke, Fed chairman, said: “My colleagues at the Federal Reserve and I believe that accommodative policies will likely be warranted for an extended period.”

He added: “At some point, however, as economic recovery takes hold, we will need to tighten monetary policy to prevent the emergence of an inflation problem down the road.”

In such an event, Mr Bernanke identified large-scale reverse repos with “banks, the GSEs , and other institutions” as a tool that could be used to drain bank reserves.

The Fed has been exploring the possibility of conducting reverse repos with the money market mutual fund industry, via the tri-party market, according to market participants.

Since the onset of the financial crisis, the central bank has created $800bn in excess reserves, and many economists believe this poses a long-term inflation risk.

Reason: they are connected to both pubic and private investment channels. That makes it easier to conceal deals with the overarching aspect of hiding how much any particular reverse-repos will be worth in the buyback agreement. This also gives the Fed a tool to deal with Big Shitpile© without much oversight.

The Fed took a bunch a bunch of recycled cow fodder off the banks books, and now he gonna borrow the money back, with interest?

But if they're waiting for this day "as economic recovery takes hold", we'll be skating the River Styx first.

http://www.vanityfair.com/politics/features/2009/10/bailout200910?printable=true


As the Bush administration waned, the Treasury shoveled more than a quarter of a trillion dollars in tarp funds into the financial system—without restrictions, accountability, or even common sense. The authors reveal how much of it ended up in the wrong hands, doing the opposite of what was needed.

By Donald L. Barlett and James B. Steele
October 2009


.........Last October, Congress passed the Emergency Economic Stabilization Act of 2008, putting $700 billion into the hands of the Treasury Department to bail out the nation’s banks at a moment of vanishing credit and peak financial panic. Over the next three months, Treasury poured nearly $239 billion into 296 of the nation’s 8,000 banks. The money went to big banks. It went to small banks. It went to banks that desperately wanted the money. It went to banks that didn’t want the money at all but had been ordered by Treasury to take it anyway. It went to banks that were quite happy to accept the windfall, and used the money simply to buy other banks. Some banks received as much as $45 billion, others as little as $1.5 million. Sixty-seven percent went to eight institutions; 33 percent went to the rest. And that was just the money that went to banks. Tens of billions more went to other companies, all before Barack Obama took office. It was the largest single financial intervention by Treasury into the banking system in U.S. history.

But once the money left the building, the government lost all track of it. The Treasury Department knew where it had sent the money, but nothing about what was done with it. Did the money aid the recovery? Was it spent for the purposes Congress intended? Did it save banks from collapse? Paulson’s Treasury Department had no idea, and didn’t seem to care. It never required the banks to explain what they did with this unprecedented infusion of capital....

MUVH HISTORICAL DETAIL FOLLOWS SEE LINK

2 SHORT VIDEOS BY MATT TAIBBI

http://taibbi.rssoundingboard.com/short-selling-vs-naked-short-selling-an-explanation#

Taibbi's article was very good. Long though, as most his articles are more like a short novel. I don't think there is a link online yet in Rolling Stone.

Banks cutting back on loans to businesses
Credit squeeze on entrepreneurs threatens to derail
‹
WASHINGTON (MarketWatch) -- U.S. banks are reducing their lending at the fastest rate on record, tightening the credit squeeze and threatening to leave many otherwise viable businesses unable to borrow money to expand their businesses, meet their payroll or refinance their maturing debts.

According to weekly figures provided by the Federal Reserve, total loans at commercial banks have fallen at a 19% annual rate over the past three months, while loans to businesses have dropped at a 28% annualized pace.

Last autumn, bank lending temporarily expanded when other sources of funding from the shadow banking system dried up after the collapse of Lehman Bros. Since then, however, total outstanding bank loans have dropped at an accelerating pace. See the data.

The decline in bank lending mostly affects smaller businesses. Larger corporations have alternative sources of funding, including retained earnings, corporate bonds, securitized loans and new equity. Those other sources of capital have increased in recent months, but not enough to offset the decline in bank lending.



http://www.marketwatch.com/story/banks-cutting-back-on-loans-to-businesses-2009-10-09

These banksters lead us to the abyss and now are pushing us into it.

With the conclusion of last weekend’s Group of 7 proceedings in Istanbul, and the Group of 20 gathering last month, we offer our views on the realities we have faced — and those we have yet to confront — in relation to the banking system in the so-called developed world, following the Great Panic of 2008:

• Banks in North America, Europe and Japan cannot be expected to awaken suddenly one Monday morning and decide to massively dilute their existing stockholders — thereby depressing the value of their shares (of which, presumably, managements own a fair share) –to build the equity they clearly need in order to:

(i) absorb the lingering impact on bank assets’ values caused by the bursting of the most widespread financial asset bubble in modern history;

(ii) sufficiently cushion their operations in a manner that reasonably assures they do not pose meaningful systemic or depository insurance risks in the future;

(iii) resume fulfilling their principal function in the economy — that of capital formation and allocation.

Government intervention to avoid a similar result is legitimate. The notion of any individual institution being too big to fail, however, is a false precept. Regulators’ claims (however real) that the scope of their oversight and authority may prohibit them from seizing and resolving any element of a banking institution are anathema, and it is a situation that cannot be tolerated. And activities that place the banking system at risk of a major crisis caused by unregulated financial entities — the “shadow banking system” — must be monitored and curtailed.

http://dealbook.blogs.nytimes.com/2009/10/07/banking-lessons-we-should-have-learned/

:donut: and lurkers. It's Friday and time to play........

FDIC FLAME OUT or WHAT DO YOU WANT ON YOUR TOMBSTONE:

As you know, the FDIC is bank closures are up to 96. Our question is ......When Will We Hit Number 100. I'll give you a clue-it will probably be on a Friday and a big pizza delivery will be involved. So get your calendars out boys and girls. Will we be eating turkey, will we get an extra trick this Halloween, or will we get that extra lump of coal we will need to see us through this winter. Post your guess.

The only difference now is you can only have two guesses and no changes.

What will the winner get....A virtual pizza of your choice: the Bernanke Bologna Bargain, the Geithner Gorgonzola Goliath, the Summer's Sausage Special, the Obama Oahu Pipe Line Pork and Pineapple Special, the 911 Health Care Special (empty box only, no substitutions), the Warren Wrap, or enjoy our wonderful Buffet Buffet.

So place those bets and watch your spreads. I will post them as soon as I can and within the next day. If you have a special pizza that you want, be sure to post that too. I am cranking up the fire and will be happy to help you roast your own pizza.......


Oct 9, 2009
Ozy(1)
The Watcher(1)
Demeter (1)a Hawaiian Special sub Ham instead of Canadian Bacon-would you like feta with that?
Dr Pool(1) his own personal Kielbasa and Saurkraut Pizza

Oct13,2009
Tansy Gold (1) going against the trend for a sentimental fav

Oct 16, 2009
AnneD (1) close to my sentimental black Friday-I'll have the pork and pineapple special.
Dr Pool (2)
NC4BO (1) A Hobo Special-rice, beans, and sliced tube steak (hot dogs)

Oct 23, 2009
NC4BO (2) A Hobo Special-rice, beans, and sliced tube steak (hot dog)




Watch for our next Pool the Dow 10000!!!! We will begin the Dow Pool after or Flame out game so put your thinking caps on, warm up that Ouija, and shine that crystal ball.

Happy hunting and watch out for the bears.

http://timesofindia.indiatimes.com/news/business/international-business/US-bank-failures-inching-towards-100-mark-98-collapse-in-2009-/articleshow/5086622.cms

97 and 98?

Southern Colorado National Bank Pueblo CO 57263 October 2, 2009 October 6, 2009
Jennings State Bank Spring Grove MN 11416 October 2, 2009 October 6, 2009

Checked out the FDIC site and handcounted. 98.

Have a nice evening for our friends across the Atlantic.

:hi:

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

Last trade 76.083 Change +0.117 (+0.15%)

Bernanke Comments Provide Some Relief for Buck

http://www.dailyfx.com/story/market_alerts/fundamental_alert/Bernanke_Comments_Provide_Some_Relief_1255062426627.html

We have seen some profit taking in Asia thus far, although the moves have been very mild. The Australian Dollar continues to outperform against all major currencies, with the exception of the buck on Friday. The relative strength in the commodity currency has been impressive and shows no signs of let up even after breaking psychological barriers by 0.9000. The RBA rate hike and subsequent employment data this week have been the primary catalysts behind the antipodean moves. Even some reserved comments from Treasury Chief Henry on Friday have failed to weigh on the single currency. The buying back of the USD over the past few hours has been attributed to comments from Fed Chief Bernanke who alluded to Fed tightening. Meanwhile, US Treasury Summers has been on the wires reaffirming the US commitment to a strong USD policy. Looking ahead, German CPI (-0.4% expected) is due at 6:00GMT, along with German current account (8.8B expected) and trade (12B expected). UK data then takes center stage at 8:30GMT with producer prices (-0.8% expected) and the trade balance (-6300 expected).

...more...

British Pound Weakened On Dollar Strength Despite Increase in Factory Gate Prices

http://www.dailyfx.com/story/bio1/British_Pound_Weakened_On_Dollar1255086929134.html

The British Pound has remained under pressure overnight falling back below 1.600 despite a rise in factory gate prices and a narrowing trade deficit. Broad based dollar strength started the bearish momentum but we have seen sterling regain its footing against the greenback like other currencies, aided by a 0.4% increase in producer prices on an annualized basis. September saw costs passed on to consumers rise for a seventh straight month by 0.5% which led to the first yearly gain in five months. Meanwhile, declining imports outpaced weakness in exports leading to the narrowest trade deficit since 2006.

Concerns are growing that the quantitative efforts of the BoE aren’t having the intended impact as credit conditions for consumers and small businesses remain tight. The central bank refrained from adding to their efforts at yesterday’s policy meeting as they will wait for next month when they will have the quarterly inflation report in hand and will be able to make a more informed decision. November will also bring an end to the current asset purchase program allowing policy makers to better assess its effectiveness. Former MPC member David Blanchflower called for more easing from the central bank as the ultra-dove see continues downside risks to growth.

The Euro also lost ground in early trading against the dollar but has started to find a bid tone despite an unexpected drop in German exports. Demand from abroad fell for the first time in four months by 1.8% which combined with a 1.1% rise in Imports led to the trade balance surplus narrowing to 8.1 billion from 14.1 billion. Meanwhile, French industrial production surged by 1.8% as the economy continues to show signs that it is building upon the growth in the second quarter. We may be seeing the Euro supported by a spike in interest rate expectations. Overnight index swaps jumped to 99bps of rate hikes over the next twelve month from 85 yesterday. President Trichet was back on the wires today stating that liquidity efforts need to be phased out as the economy normalizes.

The dollar had its largest gain in two months on the back of comments from Fed Chairman Ben Bernanke, who stated that the central bank will look to tighten monetary policy when the economy “has improved significantly”. Following the RBA’s rate hike markets have become more sensitive to speak from other policy makers as expectations are that they will begin to follow suit. Inflation is a concern and as soon as the U.S. economy appears to have turned the corner the FOMC will look to start withdrawing liquidity from the market. However, we actually saw Credit Suisse Overnight Index Swaps price in less tightening over the next twelve months and Fed fund futures remain unchanged. The current weakness in the labor market will make it prohibitive for policy makers to begin tightening over the near-term but expect the hawkish rhetoric to increase as they look to prepare markets for the change in policy. That alone could become a supportive factor for the greenback and may end its run as a funding currency. Therefore, watch for fundamentals to grow in importance in determining price direction. Today’s calendar only boasts the U.S. trade balance which may not be market moving but investors will be interested to see of the dollar’s weakness is leading to increased demand for exports.

...more...

http://www.reuters.com/article/businessNews/idUSTRE5980MV20091009?feedType=RSS&feedName=businessNews

(Reuters) - The U.S. Federal Deposit Insurance Corp is questioning the positive conclusions given to Citigroup Inc's management team in a government-mandated review in the aftermath of the financial crisis, the Wall Street Journal said, citing people familiar with the situation.

The report said some FDIC officials were questioning the rigor of the report, based partly on interviews of Citi's executives who rated the effectiveness of their colleagues.

The FDIC did not immediately reply to a Reuters email seeking comment that was sent outside regular U.S. business hours.

While the findings still are being reviewed, the skeptical reaction could cause the FDIC to give the report little weight during the next regulatory assessment of the New York firm's management.

Management skill is one of the factors used by regulators to determine financial-health ratings of U.S. banks. Such ratings help determine whether banks will be kept on an unusually tight regulatory leash.

...more...

Skill???? Yeah, these freaks have "skills." They are "skilled" in how to fleece the world and stuff all the money in their pockets.

http://www.reuters.com/article/businessNews/idUSTRE5980D220091009?feedType=RSS&feedName=businessNews

NEW YORK (Reuters) - Bank of America Corp (BAC.N) is selling a claim with a face value of about $800 million that it holds against bankrupt Lehman Brothers Holdings Inc (LEHMQ.PK), Bloomberg reported citing people familiar with the matter.

Hedge funds are the likely buyers, Bloomberg said on Thursday, citing people who asked not to be identified because the transaction is private.

Creditors from sovereign wealth funds to sports teams submitted more than 16,000 claims against Lehman before a September 22 deadline. Bank of America filed a $2.86 billion claim, and its Merrill Lynch International unit filed one for $1.54 billion it said was tied to swap agreements, Bloomberg said.

Lehman claims with similar terms are currently selling for about 37 cents on the dollar, the people told Bloomberg.

The largest claim Lehman faces, for at least $48.8 billion, was filed by Wilmington Trust Co as indenture trustee for various Lehman senior notes, Bloomberg said.

...more...

that's a mighty big piece of wallpaper - I guess they're going to need a mighty big wall on which to hang it.

and this is just one of the big 5 or whatever, and it's been a year and STILL not put out of our misery....a world-wide game of hot potato.

http://www.reuters.com/article/bondsNews/idUSBNG32963720091009

Oct 9 (Reuters) - The U.S. Securities and Exchange Commission has released a draft five-year strategic plan which includes an overhaul of the way it inspects investment advisors in the wake of the Bernard Madoff Ponzi scheme scandal.

In the plan, released on Thursday, the security regulator said it would, "conduct a top-to-bottom review of the effectiveness of its examination process, in response to systemic failures identified by the SEC's Office of Inspector General."

The regulator has come under criticism for its failure to follow up on clues that could have uncovered Madoff's $65 billion Ponzi scheme earlier.

A report by SEC Inspector General David Kotz last month, found that the agency missed numerous red flags, did not properly follow up on leads and dismissed tips and complaints that might have uncovered Madoff's investment sham.


INCREASED REGULATION OF ASSET-BACKED SECURITIES

According to the plan, which provides goals through to 2015, the regulator also plans to revise its rules to ensure improved registration and enhanced disclosure requirements for asset-backed securities.

It may consider changes requiring brokerages to be more transparent in disclosing information relating to their compensation and conflicts of interest.

The SEC said it is in discussions to shift to a self-funding structure, instead of depending on the government for its budget.

"While during the last several years SEC budgets have not always been sufficient to maintain staffing levels and make important technology investments, the demands on SEC resources have continued to grow."

The House of Representatives draft released earlier in the month is expected to give the regulator more ammunition by doubling its budget over five years and giving it authority to reward whistle-blowers.

...more...

hmmm.... that last quoted paragraph - The House of Representatives .... now just who was in charge for most of the past 10 years?

That would encourage more to step forward. It's a tough thing to become a whistle-blower. They lose their jobs, often their careers. Who wants to hire a known whistle-blower? Current laws supposedly offer them some protection against retaliation, but loss of livelihood is a strong deterrent. A lot of people put their heads down and close their eyes tight. But if you had the possibility of a reward for revealing wrongdoing? They will start peaking through their fingers.

what the cows leave behind.

(Fixed fiscal year 2009 analysis and extracted report for 2010.)

= Held by the Public + Intragovernmental(FICA)
= 7,506,680,720,194.61 + 4,419,038,807,750.01
UP 15,260,219.44 + DOWN 1,731,633,223.72

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 308-Million person America.
If every American, man, woman and child puts in $3.25 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.75, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 10 seconds we net gain a another American, so at the end of the workday of the report, there should be 307,648,221 people in America.
http://www.census.gov/population/www/popclockus.html ON 09/27/2009 07:13 -> 307,558,299
Currently, each of these Americans owe $38,764.14.
A family of three owes $116,292.43. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 33 days.
The average for the last 23 reports is 6,117,013,086.42.
The average for the last 30 days would be 4,689,710,032.92.
The average for the last 33 days would be 4,263,372,757.20.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 6 reports in 7 days of FY2010 averaging 2.65B$ per report, 2.27B$/day.
Above line should be okay

PROJECTION:
There are 1,201 days remaining in this Obama 1st term.
By that time the debt could be between 13.6 and 18.1T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
10/07/2009 11,925,719,527,944.62 BHO (UP 1,298,842,479,031.54 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +0,015,890,524,432.90 ------------BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
09/17/2009 -017,941,949,432.55 -
09/18/2009 -000,312,998,363.37 ---
09/21/2009 -000,319,092,626.95 --- Mon
09/22/2009 -000,005,688,069.16 -----
09/23/2009 -000,186,100,874.04 ---
09/24/2009 -043,516,809,626.65 -
09/25/2009 -000,256,514,563.16 ---
09/28/2009 -000,773,265,151.59 --- Mon
09/29/2009 +000,473,982,417.68 ------------********
09/30/2009 +091,724,705,747.96 ------------**********
10/01/2009 -045,967,461,558.95 -
10/02/2009 +000,166,120,250.33 ------------********
10/05/2009 -000,035,707,866.46 ---- Mon
10/06/2009 +000,640,950,413.48 ------------********
10/07/2009 +000,015,260,219.44 ------------*******

-16,294,569,083.99 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4094549&mesg_id=4095193

(Alright now. Obama actually has a small SURPLUS going on here. This surplus is not expected to last, but it's fun to see it and to say that for the first eight days of Obama's fiscal year 2010 he, i.e. we, have paid back ten billion more than he, thus we, borrowed. Good job Barack. This may not deserve a prize, but you do deserve the prizes you've received.)

= Held by the Public + Intragovernmental(FICA)
= 7,479,183,127,883.09 + 4,419,769,623,061.44
DOWN 27,497,592,311.52 + UP 730,815,311.43

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 308-Million person America.
If every American, man, woman and child puts in $3.25 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.75, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 10 seconds we net gain a another American, so at the end of the workday of the report, there should be 307,656,861 people in America.
http://www.census.gov/population/www/popclockus.html ON 09/27/2009 07:13 -> 307,558,299
Currently, each of these Americans owe $38,676.05.
A family of three owes $116,028.16. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 days.
The average for the last 23 reports is 4,849,268,400.34.
The average for the last 30 days would be 3,717,772,440.26.

There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 7 reports in 8 days of FY2010 averaging -1.55B$ per report, -1.36B$/day.
Above line should be okay

PROJECTION:
There are 1,200 days remaining in this Obama 1st term.
By that time the debt could be between 10.3 and 18.1T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
10/08/2009 11,898,952,750,944.53 BHO (UP 1,272,075,702,031.45 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 -0,010,876,252,567.20 ----------BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
09/18/2009 -000,312,998,363.37 ---
09/21/2009 -000,319,092,626.95 --- Mon
09/22/2009 -000,005,688,069.16 -----
09/23/2009 -000,186,100,874.04 ---
09/24/2009 -043,516,809,626.65 -
09/25/2009 -000,256,514,563.16 ---
09/28/2009 -000,773,265,151.59 --- Mon
09/29/2009 +000,473,982,417.68 ------------********
09/30/2009 +091,724,705,747.96 ------------**********
10/01/2009 -045,967,461,558.95 -
10/02/2009 +000,166,120,250.33 ------------********
10/05/2009 -000,035,707,866.46 ---- Mon
10/06/2009 +000,640,950,413.48 ------------********
10/07/2009 +000,015,260,219.44 ------------*******
10/08/2009 -027,497,592,311.52 -

-25,850,211,962.96 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4096114&mesg_id=4096316

Interesting news so far today. I wonder how the markets will react.

If you haven't heard yet, President Obama won a Nobel Peace Prize. The Academy said they awarded him the prize because he is "not that scary Dick Cheney guy. Whew! Are we glad he's gone."

We attacked the Moon to find out if they have WMDs oil water! That's what we want to find out about. Turns out water is more valuable than gold (which I have been trying to explain to gold bugs for decades). Actually, if there is water on the Moon, it may encourage more Moon missions and eventual economic exploitation of Lunar resources.

Rush Limbaugh claims Kathleen Sibelius, Secretary of Health and Human Services, says we HAVE to take the flu vaccine (she didn't), so he said, "Screw you, Ms. Sibelius! I'm not taking the vaccine!" Will the markets react favorably to Rush's death from Swine flu? I know I will.

Bizarre day already. I have little doubt the markets will prove entertaining as well.

The Nobel is the craziest, though. All those people busting their personal lives and futures to make a difference, and Obama gets the prize for NOT being George Bush. Or at least, a kinder, gentler version. Let's see if he has any incentive NOW to get out of Iraq, stay out of Iran, and shut down the Afghan black hole and Gitmo and Bagrahm and all the other secret sites.

What are they gonna do? Give him a good conduct medal every year? Maybe they just WANT to see Freepers gunning for him! It's quixotic, really.

But I remember in kindergarten, all good behavior got ya was a gold star sticker and maybe a sucker to munch on.

..it's what I was thinking after reading a number of posts on DU this a.m. and I don't have an asbestos suit to protect me from the searing heat, so I said it here.

I still don't really, actually get it. I sincerely hope the world isn't depending on the Hope and Change rhetoric and if it is, I hope Pres. Obama does everything he can to not to disappoint the hopeful and overly optimistic.

Sidenote: I've watched my local morning news this morning and haven't heard one peep about this Nobel Prize thing.

ETA: I'm going to read some more Nobel Peace Prize threads and get some answers to my questions.

When they gave it to Henry Kissinger.

went on to develop Mustard Gas during the Great War. Well, it kinda takes the wind out of the whole thing. But, I'm glad Obama got one. (... and nobody in the Bush Administration did. :p ) :)

the bar has been set so low, we should be grateful that Rush didn't get it.

I think it was SNL. They did a fake interview of a fake Kissinger and asked, "What was your proudest moment?"

Fake Kissinger: "When I won the Nobel Peace Prize for ending the war in Vietnam."

"What was your most embarrassing moment?"

"Two years later when the war in Vietnam actually ended."

PLEASE bring peace and earn this prize?

spotbird :)

JUST WATCHING REPUBLICAN HEADS EXPLODE.

I was up at the wee hours watching the Moon Impactor Thingie.

With my very own telemajigger! (I also caught the details on the NASA website/TeeVee Device.) Beautiful night for it... :)

I'm thinking it didn't quite turn out the way they were thinking it would... But, that's the way it is out there in space. Nobody can hear you say... Damnit! ;)

that they had to raise gas prices for the weekend? There aren't that many Italians in Michigan, so go figure. It's going to rain all weekend, too, and stay cold and gray. At this rate, I'll never get the garden put to bed before the snow falls, let alone plant any spring bulbs.

The day we celebrate Columbus bumping into America, claiming it was India, and forever after was known as "The Great Navigator."

(Got a tiny fraction of Cherokee in my ancestry. We're still upset about the immigration problem Columbus started in 1492.)

:shrug: