STOCK MARKET WATCH, Thursday May 20

Source: du

STOCK MARKET WATCH, Thursday May 20, 2010

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Euro, Yen, Loonie, Silver and Gold

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Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren

Bush Administration Officials Charged = 1
Name(s): Richard Lopez Razo

Financial Sector Officials Convicted since 1/20/09 = 11

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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

08:30 Continuing Claims 05/08
Briefing.com 4600K
Consensus 4600K
Prior 4627K

08:30 Initial Claims 05/15
Briefing.com 440K
Consensus 439K
Prior 444K

10:00 Leading Indicators Apr
Briefing.com 0.2%
Consensus 0.2%
Prior 1.4%

10:00 Philadelphia Fed May
Briefing.com 22
Consensus 20.7
Prior 20.2

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

SINGAPORE – Oil prices rose above $70 a barrel Thursday in Asia, recovering from an eight-month low after the European debt crisis battered crude this month.

Benchmark crude for June delivery was up 80 cents to $70.67 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The June contract expires later Thursday and much of the trading volume has shifted to the July contract, which rose 72 cents to $73.22.

U.S. Oil supply data from the Energy Department's Energy Information Administration was mixed. Crude inventories rose last week while gasoline stocks fell.

In other Nymex trading in June contracts, heating oil rose 0.5 cent to $1.95 a gallon, and gasoline gained 0.8 cent to $2.02 a gallon. Natural gas rose 3.2 cents to $4.19 per 1,000 cubic feet.

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

NEW YORK (Reuters) – U.S. meat companies are not expecting much growth in restaurant dining this year as consumers continue to worry about the economy and their jobs, thus preferring to eat at home.

While the worst of the decline in restaurant dining may be over, future growth should be slow, meat firms said on Wednesday.

Restaurants are important to meat companies, as they use higher-priced and more profitable cuts such as steaks, pork chops and chicken breasts.

In an interview on the sidelines of the conference, Sanderson said the nearly 10 percent unemployment in the United States should prevent significant growth this year in restaurant sales.

One exception to the bleak view was from Darling International, which recycles used cooking oil and has seen an increase this year in restaurant use of vegetable oil, a sign that restaurants are doing more business.

http://news.yahoo.com/s/nm/20100520/us_nm/us_meat_restaurants

WASHINGTON – Federal Reserve officials were divided over when the Fed should start shedding its vast portfolio of mortgage securities. The tricky endeavor would move the central bank closer to tightening credit for millions of Americans.

Minutes of the Fed's closed-door meeting April 27-28 released Wednesday show Fed officials expressed wide-ranging views about when and how the Fed should go about selling some of the $1.25 trillion of mortgage securities bought during the financial and economic crises. The assets were purchased to drive down mortgage rates and aid the housing market.

The minutes also reveal that some officials had new concerns that the European debt crisis could slow the U.S. recovery. At the same time, Fed officials offered a more upbeat outlook for the U.S. economy with stronger growth, slightly lower unemployment and tame inflation.

On the mortgage securities matter, the challenge is to sell those assets in a way that doesn't weaken home prices and jack up mortgage rates.

Most Fed officials expressed a preference for strategies that would "eventually" lead to the sale of mortgage securities in an effort to shrink the Fed's $2.3 trillion balance sheet back to a more normal size. And, they thought that any move to sell the assets should be communicated in advance. But they differed on the timing and the details of how to do this.

http://news.yahoo.com/s/ap/20100519/ap_on_bi_ge/us_fed_minutes

what a racket!

Why isn't the Fed turning the mortgages that were obtained fraudulently back to the originators? (In the few cases that the bank/finance company still exists)

I think they have the mortgage-backed securities.

In other words, no redeemable value pieces of paper.

The only ones who might be interested are vultures who think they will find a bone to pick.

Of course, until there's an audit, we don't really know.

May 20 (Bloomberg) -- Japan’s economy grew less than forecast in the first quarter as an export-led recovery failed to stoke consumer spending, putting pressure on the central bank to do more to end deflation as it begins a two-day meeting.

Gross domestic product rose an annualized 4.9 percent, less than the 5.5 percent median forecast in a Bloomberg survey of 21 economists, a Cabinet Office report showed in Tokyo. Export gains saw nominal GDP, which is unadjusted for price changes, increase 1.2 percent on a quarterly basis, the most in a decade.

Stocks fell and Finance Minister Naoto Kan said he expects the Bank of Japan, which is planning measures to encourage banks to lend more, to support an economy that’s not yet in a self-sustained recovery. The comeback in world trade, spurred by China’s demand, is helping countries across Asia, with Singapore and Taiwan today both reporting jumps in GDP. “As long as demand from emerging economies remains strong, Japan’s economy will stay on a recovery track,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management Co. in Tokyo. The direction of overseas economies poses “a major risk factor,” he said after Europe’s debt crisis has deepened concern about the durability of global growth.

Japan’s benchmark Nikkei 225 Stock Average dropped 1.5 percent to 10,030.31 at the close in Tokyo, bringing its slide in the past month to 8 percent. Against the euro, the yen strengthened 0.8 percent to 112.90. Its 11 percent climb versus the European currency in the past month threatens to make its exports to the region more costly.

http://www.businessweek.com/news/2010-05-20/japan-s-gdp-grows-less-than-forecast-pressuring-boj-update2-.html

they can't be squeezed by speculators the way Greece, Spain, Portugal, Italy and Ireland are being squeezed. Interesting report on NPR yesterday or maybe this morning on that.

Most US debt was held by the US at one time. Now that everybody has it, and there's so much, is squeezing the US through the debt even feasible?

WASHINGTON (CNNMoney.com) -- After months of negotiation and debate, far-reaching legislation to overhaul the rules of Wall Street failed a key test vote in the Senate on Wednesday, casting a shadow over Democratic efforts to push the effort forward.

The measure aims to stop bailouts, shine a light on complex financial products and strengthen consumer protection.

The vote was 57 to 42. Under Senate rules, Democrats needed 60 votes to move ahead to a final vote. Two Democrats opposed the bill, and two Republicans voted for it.

What reform means: The legislation would establish a consumer financial protection regulatory agency that could write new rules to protect consumers from unfair or abusive mortgages and credit cards.

It would create a council of regulators that would sound an alarm before companies are in position to trigger a financial crisis. The bill would also establish new procedures for shutting down giant financial firms that are collapsing.

One big issue that remains in flux is a controversial proposal to crack down on banks that trade derivatives.

http://money.cnn.com/2010/05/19/news/economy/Wall_Street_reform/index.htm

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Senators Maria Cantwell and Russ Feingold were the two Democratic senators to vote 'no' because the amendment does not go far enough in limiting bank activities.

From Naked Capitalism:

Today provided yet another example of how the best government money can buy works. The Senate majority leader Harry Reid suffered an embarrassing defeat when his effort to pass a motion for cloture, which would have stopped debate on the financial reform bill, failed due to two Democrat and one Republican defection among the votes he thought he had. And the naysayers are the typical “teki no teki wa mikata” (enemy of enemy is friend) alliances that are routine in politics. The Republicans are virtually united against the bill (the only defections are the two senators from Maine); the two rogue Democrats, Maria Cantwell (Washington) and Russ Feingold (Wisconsin) are opposed because the feel the bill is not tough enough (Cantwell wants votes on two amendments).

This tempest in a teapot is engaging distraction. Why have political commentators been hesitant to connect the dots between the “no incumbent left standing” movement and the lack of meaningful financial reform?

This piece of his post caught my eye:

All through this time, Chris Dodd filed an amendment to gut the strongest piece of his own bill – the derivatives piece “authored” by Blanche Lincoln. I say “authored” because it was completely obvious that she was handed this tough bill for the benefit of her re-election, and even though that wasn’t secured last night, on the very same night they submitted the weakening piece in the form of a manager’s amendment. Instead of spinning off the lucrative swaps trading desks from the big banks, the bill as amended would let the systemic risk council, made up of agencies who opposed the proposal, “study” the provision, until making a (foregone) decision in two years. Lincoln says she’ll fight against the weakening amendment – oh, we’ll see about that.

Yves here. If the derivatives language was indeed provided to Lincoln as a bit of useful pre-election theater, the process is every bit as cynical as I thought. Readers no doubt know I am no fan of big financial firm chicanery, and a card carrying hater of credit default swaps (for background, see here). But the Lincoln amendment is guaranteed not to happen. The industry is correct in howling that implementing it would be hugely disruptive (the dealers themselves are the biggest users of plain vanilla interest rate and FX swaps; their trading volumes would overwhelm any independent swaps dealer).

more...

http://www.nakedcapitalism.com/2010/05/how-financial-reform-gets-done-not.html

(Fortune) -- It certainly looks like happy days are here again. Many of the nation's biggest retailers, including Saks, Hewlett-Packard, Home Depot, and Target have released cheery sales reports. April's jobs reports showing a slight increase in the workweek and pay for workers, and more hiring across the board.

And then there is Wal-Mart, whose happy yellow face switched to a grimace when it released first quarter sales on Tuesday. Although international growth helped push revenues up 6%, sales at U.S. stores fell 1.4% from the same period last year. And the company had no one to blame but its shoppers. "More than ever, our customers are living paycheck to paycheck," said Tom Schoewe, the chief financial officer.

So who are you supposed to believe? In this case, Bentonville. When Wal-Mart (WMT, Fortune 500), an economic bellwether, notes that customers can't afford the gas to get to the stores and that they're increasingly using food stamps when they get there, things are bad.

Real wages have continued to decline. Inflation-adjusted personal disposable income has remained relatively flat. And, even if current economic growth were sustained, it would take more than three years to bring the unemployment rate below 6.3%, where it was at the peak of the 2001 recession. Meanwhile, the Mortgage Bankers Association reported yesterday that the number of mortgages in foreclosure has climbed to a new record, with foreclosures and delinquencies now accounting for one out of every seven US mortgages out there.

http://money.cnn.com/2010/05/20/news/economy/consumer_retail_walmart.fortune/index.htm

And the foreclosure rate at one-in-20

http://www.zerohedge.com/article/us-economy-so-healthy-one-ten-mortgages-delinquent-new-record-one-twenty-foreclosure

European stocks rebounded after a 3 percent drop in the benchmark Dow Jones Stoxx 600 Index left the gauge trading near the cheapest valuation since 2008. Asian shares declined while U.S. index futures fluctuated.

Vienna Insurance Group, Austria’s largest insurer, surged 2.7 percent after first-quarter profit topped estimates. Fiat SpA gained 2.3 percent as Royal Bank of Scotland Group Plc recommended Italy’s biggest automaker. Royal BAM Groep NV rallied 7 percent after the biggest Dutch builder posted a 19 percent jump in first-quarter profit.

The Stoxx 600 climbed 0.4 percent to 244.77 at 10:39 a.m. in London. The measure has fallen 10 percent from this year’s peak on April 15 as Portuguese and Spanish credit-rating downgrades heightened concern Greece’s debt crisis will spread through the euro region. The decline has left the gauge trading at less than 15 times its companies’ reported earnings, near the lowest level since December 2008.

European equities fell yesterday, and U.S. stocks declined for a second day, after Germany’s unilateral ban on some bets against government bonds and financial institutions triggering a flight from equities. U.S. shares pared some losses after as the euro extended its rebound from a four-year low against the dollar and the Federal Reserve said it was in no hurry to sell mortgage assets.

The MSCI Asia Pacific Index lost 1.7 percent today, falling to an eight-month low as Japan’s gross domestic product rose less than economists had forecasts. Futures on the Standard & Poor’s 500 Index were little changed before reports on leading economic indicators and jobless claims.

http://preview.bloomberg.com/news/2010-05-20/european-stocks-rebound-from-yesterday-s-drop-fiat-royal-bam-shares-gain.html

From Barry Ritholtz:

I am on an email list that is from a group smart hedgies and strategists. The discussions range far and wide, and while I sometimes disagree with the conclusions, but I always find the conversation provocative.

Lately, they’ve been emailing a collection of warnings of various fund managers and strategists:

• Long time Dow Theorist Richard Russell set out this dire warning:

“Do your friends a favor. Tell them to “batten down the hatches” because there’s a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don’t need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won’t recognize the country. They’ll retort, “How the dickens does Russell know — who told him?” Tell them the stock market told him.”

• Reuters reported that well regarded hedge fund manager Seth Klarman “sees few bargains in the current environment and predicted on Tuesday that the stock market could suffer another lost decade without any gains.” Klarman is concerned that we could see “another 10 years of zero returns.” He has 30 percent of assets at his $22 billion Baupost Group in cash, he said. (His firm started in 1982 with $27 million and has averaged 20 percent annual gains ever since).

http://www.ritholtz.com/blog/2010/05/bears-come-roaring-forth/

Dow Theory, which stems from observations made by Wall Street Journal founder Charles Dow during the late 1800s, holds that moves by the transportation average must be “confirmed” by the industrial measure, and vice versa, to be sustained.

The Dow Jones Industrial Average fell 6.9 percent during the four days that ended May 7, sinking to 10,380.43, the lowest level since Feb. 26. The transportation gauge closed at 4,298.12, down 11 percent in four days. Downgrades of Greece, Spain and Portugal helped trigger the decline as the prospect of a sovereign default in Europe undermined investor confidence.

“If the two averages violate their May 7 lows, I see a major crash as the outcome,” Russell wrote. With the exception of gold companies, Russell advised readers to “get out of stocks now, and I don’t give a damn whether you have paper losses or paper profits.”
-----------------------------------------------------------------

Dow was at 10,357 at 7:10am. I didn't check the transports, but the were around 100pts above the 4298 at the close yesterday.

Not, that I put much faith in Dow Theory. We all remember that crank-yanker who was always babbling about non-confirmation confirmations in the opening SMW post a long time ago. But, it looks like a herd mentality among big-money funds, is getting ready to stampede. They're starting to realize that there just ain't any "there" there. Propaganda and double-think will only last so long.

We'll see what Russell is made of.

I feel so violated.

(What (Cheney) rules, you may well ask?).

Let's place the blame fair and square where it belongs:

In your Senate.

Not just the banks. Big industries of all sorts own the Senate. Just regard the latest Senate vote on financial regulations to measure how bought the institution remains, still, four years after the Republicans lost power.

:donut: :donut: :donut: It is time to start my day away from here. Have fun watching the Casino. :hi:

Must be nice to sleep in.

Good morning everybody (and Ozy).

And a certain animal, for some reason, didn't decide that 4:30am was a good time to play, and walk across my chest, as usual.


Who, me?

But sometimes, he does stick his big nose were it does not belong at 5am. (For all interested, look to the left <-- ;)

I checked the futures about a half-hour ago.

Dow was down 48 points.

Now it's down 145 points. S&P down 19. Nasdaq down 26.

Batten the hatches!

UE way worse than expected, Bangkok is burning, Greek protests are going to be massive, overseas markets down big, even gold is falling. Good day to head to the beach and hide your head in the sand.. especially if you've got fat fingers.

how could I forget about that unwinding fiasco?

No safe havens any more, financial or otherwise.

The flamethrowers will be out!

http://www.msnbc.msn.com/id/37248587/ns/us_news-the_new_york_times/


Scientists accuse Obama over oil spill
Expert claims NOAA is guilty of a 'catastrophic failure'


Tensions between the Obama administration and the scientific community over the gulf oil spill are escalating, with prominent oceanographers accusing the government of failing to conduct an adequate scientific analysis of the damage and of allowing BP to obscure the spill’s true scope.

The scientists assert that the National Oceanic and Atmospheric Administration and other agencies have been slow to investigate the magnitude of the spill and the damage it is causing in the deep ocean.

They are especially concerned about getting a better handle on problems that may be occurring from large plumes of oil droplets that appear to be spreading beneath the ocean surface.

Drive-by posting here folks. I expect the day will cause many 'hopes' to wither. Not the least of which: oil futures.

http://www.informationclearinghouse.info/article25455.htm

...James K. Galbraith, an economist and the son of John Kenneth Galbraith, the late and great economist who argued that "corporate larceny" was behind the crash of '29, (I honor hin in the DVD of my film) believes that the economics profession, the "experts" who set the terms of the debate are partly responsible. He shared his views in recent Congressional testimony.

"I write to you from a disgraced profession. Economic theory, as widely taught since the 1980s, failed miserably to understand the forces behind the financial crisis. Concepts including "rational expectations," "market discipline," and the "efficient markets hypothesis" led economists to argue that speculation would stabilize prices, that sellers would act to protect their reputations, that caveat emptor could be relied on, and that widespread fraud therefore could not occur. Not all economists believed this - but most did.

Thus the study of financial fraud received little attention. Practically no research institutes exist; collaboration between economists and criminologists is rare; in the leading departments there are few specialists and very few students. Economists have soft- pedaled the role of fraud in every crisis they examined, including the Savings & Loan debacle, the Russian transition, the Asian meltdown and the dot.com bubble. They continue to do so now. At a conference sponsored by the Levy Economics Institute in New York on April 17, the closest a former Under Secretary of the Treasury, Peter Fisher, got to this question was to use the word "naughtiness." This was on the day that the SEC charged Goldman Sachs with fraud."

What a world: people who steal food are deemed criminals and sent away with long sentences in a prison system with the highest rate of incarceration in the world. Banksters are considered "naughty."

This may be changing, ever so slowly, as a new era of investigations begins. The President has created a new federal anti-financial fraud task force. Goldman Sachs is being probed. So is Morgan Stanley. The Daily Beast reports on NY Attorney General Andrew Cuomo's latest highly political legal jihad:

"New York Attorney General Andrew Cuomo is launching an investigation into eight banks to see whether they misled rating agencies, The New York Times reports Thursday. The agencies have been under attack since the financial crisis for over-rating the quality of mortgage investments offered by the banks. Cuomo's new inquiry suggests that he believes that error may be in part due to banks' chicanery. The A.G. is targeting Goldman Sachs, Morgan Stanley, UBS, Citigroup, Credit Suisse, Deutsche Bank, Crédit Agricole, and Merrill Lynch. It is a high-profile investigation for a politician who is said to have his heart set on New York's governor's seat."

The problem here is that the criminal enterprise we are up against is not just in finance where securities laws only protect investors, but in real estate and insurance. The crimes there were more pervasive and hurt more people. You need a sense of how this whole system of corruption worked. This chart offers one sense of it: SEE LINK FOR CHART AND MORE

http://www.informationclearinghouse.info/article25453.htm

Granted, the $700 billion dollar TARP bailout was a massive bait-and-switch. The government said it was doing it to soak up toxic assets, and then switched to saying it was needed to free up lending. It didn't do that either. Indeed, the Fed doesn't want the banks to lend.

True, as I wrote in March 2009:

***

In other words, through a little game-playing by the Fed, taxpayer money is going straight into the pockets of investors in AIG's credit default swaps and is not even really stabilizing AIG.

But the TARP bailout is peanuts compared to the numerous other bailouts the government has given to the giant banks.

And I'm not referring to the $23 trillion in bailouts, loans, guarantees and other known shenanigans that the special inspector general for the TARP program mentions. I'm talking about more covert types of bailouts.

Like what?

Guaranteeing a Fat Spread on Interest Rates

Well, as Bloomberg notes:



The trading results, which helped the banks report higher quarterly profit than analysts estimated even as unemployment stagnated at a 27-year high, came with a big assist from the Federal Reserve. The U.S. central bank helped lenders by holding short-term borrowing costs near zero, giving them a chance to profit by carrying even 10-year government notes that yielded an average of 3.70 percent last quarter.

The gap between short-term interest rates, such as what banks may pay to borrow in interbank markets or on savings accounts, and longer-term rates, known as the yield curve, has been at record levels. The difference between yields on 2- and 10-year Treasuries yesterday touched 2.71 percentage points, near the all-time high of 2.94 percentage points set Feb. 18.

Harry Blodget explains:



Trading, of course, is supposed to be a risky business: You win some, you lose some. That's how traders justify their gargantuan bonuses--their jobs are so risky that they deserve to be paid millions for protecting their firms' precious capital. (Of course, the only thing that happens if traders fail to protect that capital is that taxpayers bail out the bank and the traders are paid huge "retention" bonuses to prevent them from leaving to trade somewhere else, but that's a different story).

But these days, trading isn't risky at all. In fact, it's safer than walking down the street.

Why?

Because the US government is lending money to the big banks at near-zero interest rates. And the banks are then turning around and lending that money back to the US government at 3%-4% interest rates, making 3%+ on the spread. What's more, the banks are leveraging this trade, borrowing at least $10 for every $1 of equity capital they have, to increase the size of their bets. Which means the banks can turn relatively small amounts of equity into huge profits--by borrowing from the taxpayer and then lending back to the taxpayer.
***

The government's zero-interest-rate policy, in other words, is the biggest Wall Street subsidy yet. So far, it has done little to increase the supply of credit in the real economy. But it has hosed responsible people who lived within their means and are now earning next-to-nothing on their savings. It has also allowed the big Wall Street banks to print money to offset all the dumb bets that brought the financial system to the brink of collapse two years ago. And it has fattened Wall Street bonus pools to record levels again.

Paul Abrams chimes in:



Nor has any credit been extended to allow the real value-producers to meet payroll, to reserve a stadium, to purchase capital equipment, to hire employees. Nothing.

Congress should put an immediate halt to this practice. Banks should have to show that the money they are borrowing from the Fed is to provide credit to businesses, or consumers, or homeowners. Not a penny should be allowed to be used to purchase Treasuries. Otherwise, the Fed window should be slammed shut on their manicured fingers.

And, stiff criminal penalties should be enacted for those banks that mislead the Fed about the destination of the money they are borrowing. Bernie Madoff needs company.

There is another type of guaranteed spread that allows the giant banks to make money hand over fist. Specifically, the Fed pays the big banks interest to borrow money at no interest and then keep money parked at the Fed itself. (The Fed is intentionally doing this for the express purpose of preventing too much money from being lent out to Main Street. That's just dandy.)

The giant banks are receiving many other covert bailouts and subsidies as well.

Too Big As Subsidy

Initially, the fact that the giant banks are "too big to fail" encourages them to take huge, risky gambles that they would not otherwise take. If they win, they make big bucks. If they lose, they know the government will just bail them out. This is a gambling subsidy.

The very size of the too big to fails also decreases the ability of the smaller banks to compete. And - since the government itself helped make the giants even bigger - that is also a subsidy to the big boys.

The monopoly power given to the big banks (technically an "oligopoly") is a subsidy in other ways as well. For example, Nobel prize winning economist Joseph Stiglitz said in September that giants like Goldman are using their size to manipulate the market:



The giants (especially Goldman Sachs) have also used high-frequency program trading which not only distorted the markets - making up more than 70% of stock trades - but which also let the program trading giants take a sneak peak at what the real (aka “human”) traders are buying and selling, and then trade on the insider information. (This is frontrunning, which is illegal; but it is a lot bigger than garden variety frontrunning, because the program traders are not only trading based on inside knowledge of what their own clients are doing, they are also trading based on knowledge of what all other traders are doing).

Goldman also admitted that its proprietary trading program can "manipulate the markets in unfair ways". The giant banks have also allegedly used their Counterparty Risk Management Policy Group (CRMPG) to exchange secret information and formulate coordinated mutually beneficial actions, all with the government's blessings.

In addition, the giants receive many billions in subsidies by receiving government guarantees that they are "too big to fail", ensuring that they have to pay lower interest rates to attract depositors.

Derivatives

The government's failure to rein in derivatives or break up the giant banks also constitute enormous subsidies, as it allows the giants to make huge sums by keeping the true price points of their derivatives secret.

Toxic Assets

The PPIP program - which was supposed to reduce the toxic assets held by banks - actually increased them, and just let the banks make a quick buck.

In addition, the government suspended mark-to-market valuation of the toxic assets held by the giant banks, and is allowing the banks to value the assets at whatever price they desire. This constitutes a huge giveaway to the big banks.

As one writer notes:

By allowing banks to legally disregard mark-to-market accounting rules, government allows banks to maintain investment grade ratings.

By maintaining investment grade ratings, banks attract institutional funds. That would be the insurance and pension funds money that is contributed by the citizen.

As institutional money pours in, the stock price is propped up ....

Mortgages and Housing

PhD economists John Hussman and Dean Baker (and fund manager and financial writer Barry Ritholtz) say that the only reason the government keeps giving billions to Fannie and Freddie is that it is really a huge, ongoing, back-door bailout of the big banks.

Many also accuse Obama's foreclosure relief programs as being backdoor bailouts for the banks.

Foreign Bailouts

The big banks - such as JP Morgan - also benefit from foreign bailouts, such as the European bailout, as they are some of the largest creditors of the bailed out countries, and the bailouts allow them to get paid in full, instead of having to write down their foreign losses.

These are just a few of the secret bailouts programs the government is giving to the giant banks. There are many other bailout programs as well. If these bailouts and subsidies are added up, they amount to many tens - or perhaps even hundreds - of trillions of dollars.

And then there is the cost of debasing the currency in order to print money to fund these bailouts. The cost to the American citizen in less valuable dollars will be truly staggering.

:(

The Spouse noted that when the planes flew into the towers on 9/11, they reportedly destroyed the ethics oversight departments of a number of wall street investment firms. No lives were lost.

A line from "A Hitchhikers Guide to the Galaxy".

Boy, ain't that the truth anymore.

(Up a little. Good day.)

(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 8,466,530,667,286.64 + 4,518,135,997,823.93
UP 360,533,772.20 + UP 9,410,201,121.81

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 309-Million person America.
If every American, man, woman and child puts in $3.23 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.7, ABOUT TEN BUCKS for a 1B$ 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 13 seconds we net gain another American, so at the end of the workday of the report, there should be 309,294,270 people in America.
http://www.census.gov/population/www/popclockus.html ON 04/09/2010 15:49 -> 309,034,742
Currently, each of these Americans owe $41,981.59.
A family of three owes $125,944.78. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 32 days.
The average for the last 22 reports is 4,861,470,877.80.
The average for the last 30 days would be 3,565,078,643.72.
The average for the last 32 days would be 3,342,261,228.49.
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$/day.
There were 157 reports in 230 days of FY2010 averaging 6.85B$ per report, 4.67B$/day.
Above line should be okay

PROJECTION:
There are 978 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 and 18.0T$.
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)
05/18/2010 12,984,666,665,110.57 BHO (UP 2,357,789,616,197.49 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 +1,074,837,661,598.80 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof10 +1,705,720,636,885.05 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/27/2010 +000,734,843,937.10 ------------********
04/28/2010 -000,020,446,125.69 ----
04/29/2010 -019,519,315,418.04 -
04/30/2010 +098,427,087,705.17 ------------**********
05/03/2010 -004,329,381,263.93 -- Mon
05/04/2010 +000,043,170,775.25 ------------*******
05/05/2010 +000,598,834,211.91 ------------********
05/06/2010 -014,947,673,650.95 -
05/07/2010 +000,000,195,077.74 ------------*****
05/10/2010 +000,804,647,162.22 ------------******** Mon
05/11/2010 -000,148,047,510.67 ---
05/12/2010 +000,782,970,242.92 ------------********
05/13/2010 +003,301,759,550.17 ------------*********
05/14/2010 -000,440,383,687.55 ---
05/18/2010 +000,360,533,772.20 ------------******** Tue

65,648,794,777.85 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
http://www.usdebtclock.org/
DUer primer on National debt

(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=4388098&mesg_id=4388113

(Up a little. Good day.)

(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 8,466,739,480,001.79 + 4,508,552,847,566.18
UP 208,812,715.15 + DOWN 9,583,150,257.75

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 309-Million person America.
If every American, man, woman and child puts in $3.23 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.7, ABOUT TEN BUCKS for a 1B$ 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 13 seconds we net gain another American, so at the end of the workday of the report, there should be 309,300,916 people in America.
http://www.census.gov/population/www/popclockus.html ON 04/09/2010 15:49 -> 309,034,742
Currently, each of these Americans owe $41,950.38.
A family of three owes $125,851.15. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 days.
The average for the last 22 reports is 5,101,950,561.44.
The average for the last 30 days would be 3,741,430,411.72.

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$/day.
There were 158 reports in 231 days of FY2010 averaging 6.74B$ per report, 4.61B$/day.
Above line should be okay

PROJECTION:
There are 977 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 and 18.0T$.
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)
05/19/2010 12,975,292,327,567.97 BHO (UP 2,348,415,278,654.89 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 +1,065,463,324,056.20 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof10 +1,683,524,299,915.64 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/28/2010 -000,020,446,125.69 ----
04/29/2010 -019,519,315,418.04 -
04/30/2010 +098,427,087,705.17 ------------**********
05/03/2010 -004,329,381,263.93 -- Mon
05/04/2010 +000,043,170,775.25 ------------*******
05/05/2010 +000,598,834,211.91 ------------********
05/06/2010 -014,947,673,650.95 -
05/07/2010 +000,000,195,077.74 ------------*****
05/10/2010 +000,804,647,162.22 ------------******** Mon
05/11/2010 -000,148,047,510.67 ---
05/12/2010 +000,782,970,242.92 ------------********
05/13/2010 +003,301,759,550.17 ------------*********
05/14/2010 -000,440,383,687.55 ---
05/18/2010 +000,360,533,772.20 ------------******** Tue
05/19/2010 +000,208,812,715.15 ------------********

65,122,763,555.90 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
http://www.usdebtclock.org/
DUer primer on National debt

(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=4389734&mesg_id=4389922

10:19AM... Dow is down 233 points.

those High Frequency Computers are taking over!

http://www.youtube.com/watch?v=5gqT6En2O78&feature=related

Free Falling (Tom Petty)

she's a good girl, loves her mama
loves jesus and america tooshe's a good girl, crazy 'bout elvis
loves horses and her boyfriend too

it's a long day, living in reseda
there's a freeway running throough the yard
and i'm a bad boy, 'cause i don't even miss her
i'm a bad boy, for breaking her heart

chorus : and i'm free --- free falling
yeah i'm free --- free falling

all the vampires walking through the valley
move west down ventura boulevard
and all the bad boys are standing in the shadows
all the good girls are home with broken hearts

chorus : and i'm free --- free falling
yeah i'm free --- free falling

i wanna glide down over mulholland
i wanna write her name in the sky
i wanna free fall out into nothing
gonna leave this place for a while

chorus : and i'm free --- free falling
yeah i'm free --- free falling

You rock, TD! :yourock:

Sorry. What an ear-worm.

Keep your eye on this one, my advice: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x4389650

So... we get another ramp up at the end of the day so the final result doesn't look so bad again?

Manipulated markets are so much fun to watch.

http://www.youtube.com/watch?v=onpIh6nj3Zg&feature=related

Das Boot (dive alarm scene)
Best existential submarine movie ever made.

If an average finishes below the level on this list, it’s “officially” in correction by the traditional Wall Street definition. If it stays above the level, it’s not in a correction.

* Dow — 10085
* S&P — 1096
* Nasdaq — 2278
* Russell — 668
* Dow Transports — 4325

If you’re wondering why the Dow industrials are the furthest from correction, the talk among traders is that the average is relatively underweight some of the most volatile sectors in the market right now, especially commodities and technology.

http://blogs.wsj.com/marketbeat/2010/05/20/looks-like-this-is-it-the-long-awaited-correction/


Right now the S&P is at 1082 and Nasdaq is at 2222.

And oil is down over three bucks.

will it end below 10,000 today?

Fuck.

Holy moly. I revise my October guess of 10,000 to NEXT WEEK.

See above, I called it this morning. Gawd, these manipulators are so transparent.

sinking again

Murphy's Law comes to give me a smackdown LOL

Closed less than a point above the day's low point.

that was pretty well exposed by the 'flash crash' the other week

Down . . . Down . . . Down . . . Down.

Although it isn't funny for people in the markets

not so much.

I do feel sincere concern for the regular "joes" who will suffer because somebody made out today. Because you know as well as I do...the house always comes out ahead.


And all in all I'd rather laugh than cry.......

Somebody hit an "F" and a "U".

This afternoon my dollar will buy less than it used to in places that use euros, but more in Canada? I get confused as to which way is up and which way is down. Thanks.

When you see a FX report this is how to read it, here's today's numbers for those currencies:

Euro - USD 1.2564 +0.0190 (1.54%)
CAD - USD 0.9390 -0.0159 (-1.66%)

One Euro is presently equivalent to $1.2564, which is almost 2 cents more costly in USD than yesterday.
One Canadian dollar is $0.939, which is about a penny and a half cheaper than yesterday.

So it's one unit of the first currency listed costs X amount of the second currency listed.

Looking at the USD vs. the Yen, today's line is:

USD - JPY 90.0800 -1.4800 (-1.62%)

So one US dollar costs 90.08 yen today, which is 1.48 yen less expensive than yesterday.

Thank you.

That stings. Last time I checked, the Dow was down 175. The Witching Hour certainly lived up to its name today.

Why don't they announce it anymore?

I'm thinking a Great Depression Retrospective--or is that simply too depressing?

Fred Astaire and Ginger Rogers? They kept people on their toes throughout the hard times...

the funniest comedy I know? A Funny Thing Happened on the Way to the Forum with Zero Mostel and Jack Gilford. Of course the Producers is also magnificent, and with its theme of control fraud, appropos.

I am so wiped by this week, I can't decide.

And apropos of modern economics, at least the Wall Street variety.
Whichever you decide on will be great. And, with the regular gang's sense of humor, none of the above would be considered too depressing.

sigh.

I think Zero Mostel would be a good star--the man was larger than life, and still is even in death...and he had such blockbusting hits. A guaranteed cheerer-upper, and I for one need cheering. the whole country needs cheering.

+1 on Zero!

Stage Door

Gold Diggers of 1933

Gold Diggers of 1935

The Grapes of Wrath isn't one I'd suggest. That one is bearable only when things are going reasonably well.