STOCK MARKET WATCH, Friday April 17

[ozymandius]

Source: du

STOCK MARKET WATCH, Friday April 17, 2009

Bush Administration Officials Under Indictment = 2
Financial Sector Officials Under Indictment = 0
Financial Sector Officials In Prison = 2

AT THE CLOSING BELL ON April 16, 2009

Dow... 8,125.43 +95.81 (+1.18%)
Nasdaq... 1,670.44 +43.64 (+2.68%)
S&P 500... 865.30 +13.24 (+1.55%)
Gold future... 879.80 -13.70 (-1.56%)
30-Year Bond 3.71% +0.07 (+1.78%)
10-Yr Bond... 2.83% +0.07 (+2.57%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie and Silver

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Read more: du

[ozymandius]

1. Market Observation

Dow to Gold Ratio - No Trends Broken
BY MARTIN GOLDBERG, CMT | april 16, 2009

The chart below is a long-term weekly line chart of the Dow Industrial to Gold ratio. With stocks rallying and gold swooning for the last six weeks, it is often easy to lose site of the big picture. The big picture suggests that the rally in stocks coupled with the correction in gold is just a counter trend move against the longer term and more important trend (bull market for gold relative to stocks). As you can see in the chart, whenever this ratio became too “extended” from its long-term trend as depicted by the 50-week moving average in a big way, there was always a snap back rally of stocks relative to gold toward the long-term trend. The last cause of the deviation of the ratio from its long-term trend was the crash of the stock market coupled with the relatively stable price of gold. The result was the biggest deviation of the ratio from its long-term trend. Accordingly, a snap back of the ratio was the most likely outcome, and the snap back is still in progress.

-see chart-

The current position of the ratio to its trend suggests that the short-term trend may continue (stocks up relative to gold), as it has been common for the ratio to touch the trend line or even to go above it.

The medium/long-term (3-year) chart of the Gold Bugs Index ($HUI) also suggests that a long term up trend in gold may take significant time to develop. Here you see a crash followed by a snap back recovery. In general, big and sustained moves come off of big and sustained bases. In the case of the gold stocks, a multi-year basing pattern (not shown in its entirety) produced a big move to the downside depicted as the left side of the “V.” The downside move even “went parabolic,” and then produced a sharp snapback rally to the upside. Yet for a sustained bullish move to occur from current levels of the HUI, more of a basing pattern would likely be needed.

.....

Today’s Market

If there were a time and a place for a rally correction to occur, it would be over the next week or so. As of this moment household name, great company, and Wall Street technology favorite of the last great stock market bubble is conducting its quarterly earnings conference call. Following their bullish press release, the stock is selling off a just bit after hours.

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

[ozymandius]

2. Today's Report

09:55 Mich Sentiment-Prel Apr
Briefing.com 59.0
Consensus 58.5
Prior 57.3

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

[ozymandius]

53. drive-by confidence numbers posting - We're happy.

You got that? So stop saying we aren't! :sarcasm:

09:55 Mich Sentiment-Prel Apr
Actual 61.9
Briefing.com 59.0
Consensus 58.5
Prior 57.3

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

[ozymandius]

3. Oil hovers below $50 as recovery doubts linger

SINGAPORE – Oil prices lingered below $50 a barrel Friday in Asia as investors weighed a possible second-half recovery in U.S. crude demand against recent dismal economic data reflecting a severe recession.

Benchmark crude for May delivery fell 35 cents to $49.63 a barrel by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange. The contract on Thursday rose 73 cents to settle at $49.98.

.....

Falling crude demand and rising inventories have kept prices from rising higher. Storage facilities for crude oil in the U.S. have been swelling since the end of February, bloating to a nearly 19-year high last week.

.....

In other Nymex trading, gasoline for May delivery was steady at $1.47 a gallon and heating oil fell 0.98 cent to $1.42 a gallon. Natural gas for May delivery slid 2.9 cents to $3.57 per 1,000 cubic feet.

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

[SeeHopeWin]

9. I really REALLy want to see crude at $22.00 a barrel! Just so we can say

we can and it did!

[Ghost Dog]

19. Hope not. The current price encourages the development of alternative energy

sources/technologies without hurting real people too much.

[MARALE]

40. I agree

I think that gas needs to be around $60-$70. the oil companies were taking some of their profits and investing in alternative options because that was the trend. there was less driving and that means also less pollution and greenhouse emissions.

[Lucky Luciano]

48. Not only that, but if crude is $22 per barrel, then

there is a good chance that the S&P would also be back to 500 or so :scared:.

[ozymandius]

4. European stocks steady ahead of Citigroup earnings

LONDON – European stock markets were little changed Friday despite some solid gains earlier in Asia as investors remained cautious ahead of a key earnings report from U.S. banking giant Citigroup Inc.

The FTSE 100 index of leading British shares was up 2.97 points, or 0.1 percent, at 4,055.95 while Germany's DAX fell 4.13 point, or 0.1 percent, to 4,605.33. The CAC-40 in France rose 8.04 points, or 0.3 percent, to 3,046.22.

...

Citigroup, considered by many to be the most troubled U.S. bank, takes center stage later and worries about its earnings weighed on futures markets in the U.S. Dow futures were down 40 points, or 0.5 percent, at 8,023 while the broader Standard & Poor's 500 futures fell 5.7 points, or 0.7 percent, to 855.50.

...

Earlier in Asia, Japan's Nikkei 225 stock average added 152.32, or 1.7 percent, to 8,907.58 while Hong Kong's Hang Seng pared gains to close up 18.28 points, or 0.1 percent, at 15,601.27. India's main index advanced 2.8 percent while Australia's benchmark shed its gains to close slightly higher.

Other markets fared worse, though.

Shanghai's stock index, which has soared almost 40 percent this year on hopes government spending and other measures can help protect China's economy from the downturn, slipped 1.2 percent. Analysts pointed to government warnings that financial institutions should guard against risky loans amid a flood of a new lending as Beijing rolls out stimulus measures.

http://news.yahoo.com/s/ap/20090417/ap_on_bi_ge/world_markets_30

[ozymandius]

5. A.I.G. Chief Owns Significant Stake in Goldman

Edward M. Liddy, the dollar-a-year chief executive leading the American International Group since its bailout last fall, still owns a significant stake in Goldman Sachs, one of the insurer’s trading partners that was made whole by the government bailout of A.I.G.

Mr. Liddy earned most of his holdings in Goldman, worth more than $3 million total, as compensation for serving on the bank’s board and its audit committee until he stepped down in September to take the job at A.I.G. He moved to A.I.G. at the request of Henry M. Paulson Jr., then the Treasury secretary and a former Goldman director.

Details about his holdings were disclosed in Goldman’s proxy statement and confirmed by an A.I.G. spokeswoman, who said they constituted “a small percentage of his total net worth.” Mr. Liddy had already owned some stock in Goldman Sachs before joining its board in 2003.

....

Still, his stake could represent a potential conflict and is likely to reignite questions about Goldman’s involvement in A.I.G., and about why taxpayer money was used to shield A.I.G.’s trading partners from losses, when asset values plunged everywhere and most investors suffered greatly.

Had A.I.G. simply declared bankruptcy, the financial institutions doing business with it would have ended up in court, as they did in the case of Lehman Brothers, fighting to get pennies on the dollar for their claims.

http://www.nytimes.com/2009/04/17/business/17liddy.html

---

Did he or anyone think this information would never be made public? I feel like we've been mugged again with these insiders, trading on their associations under the guise of 'public service'.

[54anickel]

18. Gotta love this part....

A spokeswoman for A.I.G., Christina Pretto, dismissed any suggestion that Mr. Liddy’s financial ties to Goldman might have shaped his actions at A.I.G.

“A.I.G. is a large institution that engages in standard commercial activity with companies all over the world,” Ms. Pretto said. “These activities are handled in the normal, day-to-day course of business and rarely, if ever, rise to the level of the C.E.O.”

She said in particular that Mr. Liddy was not involved in the discussions of how to close out the contracts of A.I.G.’s counterparties in derivatives and other forms of trading.

“Discussions regarding these matters were handled exclusively by the Federal Reserve Bank of New York,” Ms. Pretto said. (That would be Timmay's FRB)

[Ghost Dog]

21. "Earned"? "Compensation"? Which is it?

...Or, just the usual crony-capitalist corruption...

[Ghost Dog]

22. Zurich shares seen lower after $1.9 billion AIG buy

Fri Apr 17, 2009 2:34am EDT ZURICH (Reuters) - Shares in Zurich Financial Services AG (ZURN.VX) were indicated to open about 3 percent lower on Friday after the company agreed late on Thursday to buy the U.S. auto insurance business of American International Group (AIG.N).

Europe's fourth-largest insurer Zurich said it would pay $1.9 billion for the purchase, which will make it the third-largest U.S. personal line insurer.

"The purchase price is acceptable in our opinion," Werner Eisenmann, an analyst with DZ Bank said in a research note, adding that the strengthening of the personal line business should make Zurich's earnings less volatile."The transaction shows that Zurich is able to take part in the consolidation and could hopefully benefit from the weakness of others on the back of the financial crises."

The sale by AIG is the largest asset sale by the troubled U.S. insurer since its September government rescue.

Zurich said on Thursday the purchase would immediately boost its earnings. It is to hold a conference call at 2:30 a.m. EDT.

Zurich shares, which are down 12.5 percent this year, closed 3.4 percent higher ahead of the announcement on Thursday.

The transaction is expected to close by the third quarter.

U.S. taxpayers have taken a roughly 80 percent stake in AIG, once the world's largest insurer, in exchange for providing up to $180 billion in financial support.

The company is trying to ditch assets in a bid to pay back the government but has struggled to find buyers for big-ticket assets.

/. http://www.reuters.com/article/hotStocksNews/idUSTRE53G18I20090417

[Demeter]

31. And How Big Is His Stake In Citigroup?

Bet he hasn't a dime in a car company.

[ozymandius]

6. Sony Ericsson to cut 2,000 jobs after loss

LONDON (MarketWatch) -- Sony Ericsson Mobile Communications on Friday said it's going to cut about a fifth of its workforce following a first quarter in which the maker of mobile phones lost 293 million euros ($386 million).

Sony Ericsson, an equally-owned venture between Japan's Sony and Sweden's Ericsson , said it lost 293 million euros after earning 133 million euros in the year-earlier period.

Revenue at the world's fourth-largest maker of mobile phones dropped 36% to 1.74 billion euros from 2.7 billion euros.

Sony Ericsson had warned in March that it would lose between 340 and 390 million euros before tax. On Friday, the firm said it lost 370 million euros before tax.

The phone maker sold 35% fewer phones, to 14.5 million units, on weak consumer confidence as well as retailers and operators not replenishing inventories.

...

Sony Ericsson President Dick Komiyama said on a conference call the firm hasn't decided where those cuts will come. It employs roughly 10,000 people worldwide.

http://www.marketwatch.com/news/story/sony-ericsson-cut-2000-jobs/story.aspx?guid={FD4E1EB2-588A-458A-9436-9CCC7A440066}&dist=msr_4

[ozymandius]

7. ANALYSIS-JPMorgan, Goldman trading profits unlikely to last

NEW YORK, April 16 (Reuters) - JPMorgan Chase (JPM.N) and Goldman Sachs Group (GS.N) racked up billions of dollars in trading profits in a volatile first quarter -- but don't expect these lucrative markets to last into the next quarter, or to necessarily benefit other banks, analysts say.

Goldman and JPMorgan, seen as probable long-term survivors amid the carnage that ravaged most of the industry, boosted their trading risk levels in the first three months of the year to exploit swings in asset prices.

....

But trading profits and market-share gains may not be so easy to come by in the second quarter, analysts caution, and it may be too late for other banks like Morgan Stanley -- which reports next Wednesday -- to catch up.

"This is about the best it's going to get," said Paul Miller, analyst with FBR Capital Markets.

http://uk.reuters.com/article/bankingfinancial-SP/idUKN1641439520090416

[TheWatcher]

28. It's Unlikely They Ever Existed.

Well, more than unlikely, definite.

Goldman reported false earnings that claimed the month of December does not exist.

Wells Fargo provided "Expectations" and "Forecasts" and then quietly revealed they need 50 billion in more funding, and it was revealed they had 120 Million (or was it billion? I never can keep up anymore) of Losses in the "Stress Tests"

GOD KNOWS how JPM made their earnings. I don't even want to speculate on THAT kind of VooDoo.

What needs to last is the Propaganda they feed everyone to make the Public thing that "The Recovery" is still here.

And isn't it just INTERESTING that the SECOND Quarter might not be so rosy?

So I guess they are going to have to find another Propaganda Vehicle for next Quarter.

[Lucky Luciano]

58. WFC never said they would need $50B in funding.

That was KBW (a boutique financials broker/dealer) analyst that suggested they may need $50B.

[Ghost Dog]

35. One could have a lot of questions to ask about "Goldman Sachs",

starting with, just what entity are we talking about?

Few individual "investors"/"speculators" could have the resources to devote the thousands of hours probably necessary to perform any kind of "due diligence" in relation to this termite-heap of a "black box".

For starters, the NYSE-quoted, Delaware-registered (a P.O. Box, presumably) entity "Goldman Sachs Group, Inc." (see 2008 10-K/A) claims to be (part?-)owner of, and may in its turn be part-owned by Goldman, Sachs & Co. (see 2007 Consolidated Statement of Financial Condition) - what used to be known as "The Partnership" which was recently declared to be a "Bank" in order to qualify for US Federal funds (TARP and such), in spite of recent claims that it didn't need any Federal Bailout (or, was that the Group"?), and in spite of said "Bank"'s services being apparently only available to selected corporations and "wealthy private individuals"...

The Group's 2008 Annual Report is not very helpful when it explains: "Except where specifically defined, the terms "Goldman Sachs," "the firm," "we," "us" and "our" in this document may refer to The Goldman Sachs Group, Inc. and/or its subsidiaries and affiliates worldwide, or to one or more of them, depending on the context in each instance."

The recently (also) notorious web(blog)site http://www.goldmansachs666.com/ , badly-organised as it is (although I see they are recruiting and re-organising) doesn't present much readily-accessible structural-breakdown either.

Then, of course, in the light of recent tax-haven controversy, one comes across the Goldman Sachs Swiss Bank, Goldman Sachs Bank AG, which, one may conjecture, is perhaps unlikely ever to be required by US authorities to discuss its client list; one of many (viz-a vis USA) "offshore" entities in the termite-heap, one could conjecture.

Bottom line at present as far as I'm concerned, and without mentioning the "Madoff Affair" or even Goldman Sachs (Group? Co? Offshore?)'s apparent "special relationships" eg. with the US Govt.: "due diligence" is not (deliberately?) easy to perform and is probably not feasible. You'd need to get close, very close to the inside insiders: much closer than a ten-foot bargepole.

(The above based on only mere tens of hours of relatively disinterested research).

Soundtrack: http://www.youtube.com/watch?v=PLFVGwGQcB0

Edit: Hmmm. Reboot and deep scanning of this suddenly very slow machine (heavy continuous hard disk activity) now required. :hi:

[ozymandius]

8. Wall Street loses 3,100 jobs in March

NEW YORK (Reuters) - Wall Street shed 3,100 workers in March, shrinking New York City's most important generator of jobs to just 169,200 people, the state's Department of Labor reported on Thursday.

The state, which relies on New York City to power its economy, has now lost more than 40 percent of the 400,000 jobs that employers added in the five-year economic growth spurt that ended in 2008, the Labor Department said in a report.

Unemployment rates in both New York City and New York state were unchanged in March, but a labor market analyst for the state, James Brown, cautioned against interpreting that steadiness as the start of a more positive trend.

....

New York City's unemployment rate in March of 8.1 percent is nearly double the year-ago level of 4.6 percent. The state's unemployment rate in March was 7.8 percent, compared with the year-ago rate of 4.8 percent.

....

The number of lost jobs in securities, already down by 31,100 jobs from its December 2000 peak, could increase because workers are not counted among the unemployed until their severance payments have run out, a lengthy period for many on Wall Street.

http://uk.reuters.com/article/companyNewsMolt/idUKTRE53G06M20090417

[willing dwarf]

20. Where do vermin go when they loose their lodgings?

I suppose it's not fair to paint them all with such a broad brush, but still, I do imagine the Wall Street thugs, like so many rats scuttling down the deck and leaping into the water to escape the sinking ship. I've never met anyone who was a Wall Street trader who I liked. They always seem to be shifty and looking for somoeone with higher status to talk to.

So let them flee. Just don't let their fleas land on me!

[Demeter]

33. I Doubt that the Vermin Got the Boot

they got the bonuses.

[willing dwarf]

55. Now that's sad, but probably true!

[SeeHopeWin]

10. Love the cartoon! Good morning Oz.

Thanks, good luck today.

[ozymandius]

11. Good morning.

:donut: :donut: :donut:

I hope you too have a fun day watching The Casino.

:hi:

[ozymandius]

12. Stiglitz: Bank Plan Destined to Fail, Doomed By White House/Wall Street Ties

From Naked Capitalism:

Big name economists continue their attacks on the Obama bank rescue programs. Yesterday Willem Buiter, one of Europe's most highly respected macroeconomists, continued his salvos, contending that the funding was woefully inadequate to recapitalize or otherwise prop up financial firms. The longer the US delays winding up sick banks, the more time wasted and good money thrown after bad.

Nobel prize winner Joseph Sitglitz issued even blunter criticism today (and it's hard to be more caustic than Buiter), accusing the Administration of wanting to aid industry incumbents rather than fix the system.

The worst is that the dim of criticism has been rising, yet Team Obama seems insistent on sticking with Plan A. At the rate they are going, they will succeed in proving the current system is beyond repair, and have spent enough firepower so as to have closed off other options.

From Bloomberg:

The Obama administration’s plan to fix the U.S. banking system is destined to fail...“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”

The Troubled Asset Relief Program, or TARP, isn’t large enough to recapitalize the banking system, and the administration hasn’t been direct in addressing that shortfall, he said. Stiglitz said there are conflicts of interest at the White House because some of Obama’s advisers have close ties to Wall Street.

“We don’t have enough money, they don’t want to go back to Congress, and they don’t want to do it in an open way and they don’t want to get control” of the banks, a set of constraints that will guarantee failure, Stiglitz said.

The return to taxpayers from the TARP is as low as 25 cents on the dollar, he said. “The bank restructuring has been an absolute mess.”

Much more at link...

Edit to add this bit:

Relying on low interest rates to help put a floor under housing prices is a variation on the policies that created the housing bubble in the first place, Stiglitz said.

“This is a strategy trying to recreate that bubble,” he said. “That’s not likely to provide a long run solution. It’s a solution that says let’s kick the can down the road a little bit.”

[ozymandius]

13. Stress tests deepen headache for Obama

Excerpted from the Financial Times

Within the next two weeks the Obama administration is to release some results of the long-awaited “stress tests” of the nation’s 19 largest banks. If truth be told, these tests could have been finished in an afternoon many weeks ago. But the administration pushed back the day of reckoning to buy some breathing space.

The political climate has since only deteriorated, even if the economy has shown one or two “green shoots” of recovery. Those shoots could easily be killed off by the severe frost of a bank recapitalisation exercise gone wrong. Given the weak hand at Mr Obama’s disposal, nobody should count on a successful roll-out.

With only $32bn (€24bn, £21bn) left of the $700bn in Troubled Asset Relief Pogramme (Tarp) funds – or possibly as much as $135bn depending on how you account for the Treasury’s commitments – Mr Obama will almost certainly lack the cash to recapitalise bank balance sheets. And Congress is in no mood to grant him any more.

There are three possible ways round this.

...which includes two forms of a government takeover, also called receivership, also called nationalization...

[natrat]

52. jeez almost like they are aiming for breakdown with plausible deniability,nice guys

[ozymandius]

14. Bank Stress Test Release Date: May 4th

So says Bloomberg.

[Demeter]

41. God Save Us From Politicians Too Squeamish to Shut Down a Criminal Enterprise

yet all too ready to send living humans to their deaths.

[Tansy_Gold]

50. You rang?

Oh, sorry, I don't meddle in petty squabbles on a minor planet. :hi:


If there were a god, she'd be doing a hell (pun intended) of a lot better job than this.


Tansy Gold, hardly a goddess and too buried in work this week even to keep SMW kicked to the top.

[ozymandius]

15. Have a nice day Marketeers.

It's time for me to shuffle off to school. I'll check in periodically when time permits.

:hi:

[54anickel]

16. Wow, you've been busy this morning! Have a good one Ozy.

[Ghost Dog]

17. (LEAP/E2020) Summer 2009: The international monetary system’s breakdown is underway

Vendredi 17 Avril 2009 The next stage of the crisis will result from a Chinese dream. Indeed, what on earth can China be dreaming of, caught – if we listen to Washington – in the “dollar trap” of its 1,400-billion worth of USD-denominated debt (1)? If we believe US leaders and their scores of media experts, China is only dreaming of remaining a prisoner, and even of intensifying the severity of its prison conditions by buying always more US T-Bonds and Dollars (2).

In fact, everyone knows what prisoners dream of? They dream of escaping of course, of getting out of prison. LEAP/E2020 has therefore no doubt that Beijing is now (3) constantly striving to find the means of disposing of, as early as possible, the mountain of « toxic » assets which US Treasuries and Dollars have become, keeping the wealth of 1,300 billion Chinese citizens (4) prisoner. In this issue of the GEAB (N°34), our team describes the “tunnels and galleries” Beijing has secretively begun to dig in the global financial and economic system in order to escape the « dollar trap » by the end of summer 2009. Once the US has defaulted on its debt, it will be time for the « everyman for himself » rule to prevail in the international system, in line with the final statement of the London G20 Summit which reads as a « chronicle of a geopolitical dislocation », as explained by LEAP/E2020 in this issue of the Global Europe Anticipation Bulletin.

Quarterly Chinese foreign exchange reserves growth - Source: People’s Bank of China / New York Times, 04/2009

Behind London’s « fools’ game », where everyone pretended to believe that an event of « historical » international co-operation (5) took place, the G20 summit in fact revealed major divisions. The Americans and British (followed by a compliant Japan) desperately tried to preserve their capacity to maintain control over the global financial system, freezing or diluting any significant reform granting more power to the other players, but in fact no longer powerful enough to enforce their aims. The Chinese, Russians, Indians, Brazilians,… strove to change the balance of the international monetary and financial system in their favour, but were unable (or maybe, deep down, unwilling (6)) to impose their reforms. The Europeans (the EU without the United Kingdom) proved incapable of making up their minds between the only two options available: duplicating US and UK policies and sinking along with them, or questioning the very roots of the current monetary and financial system in partnership with the Chinese, the Russians, the Indians and the Brazilians. Today the Europeans have avoided following Washington and London in their endless reproduction of failed past policies (7), but they do not yet dare to prepare for the future.

The ongoing collapse of world trade growth cannot be explained by past relationships – Quarterly growth rates annualized - Source: OECD, March 2009

The Europeans can be held accountable if, in the remaining small window of opportunity (less than 6 months now), they fail to undertake the necessary steps to avoid a 10 year-long tragic crisis (8). Indeed they have the technical know-how that can help to create an international currency based on a basket of the world’s most important currencies, and they know which political approach is required to best combine the various strategic interests of a group of countries whose currencies would comprise the new international reserve currency. Unfortunately, EU leaders (namely Eurozone ones) clearly seem unable to face their responsibilities today, as if they preferred to let the Western system break down (though claiming the contrary) rather than fight to turn it into a bridge leading to a new global system. It may be a choice (LEAP/E2020 does not believe so); it may also be the result of the pusillanimity of EU leaders selected on the basis of their docility (vis-à-vis Washington and major European financial and economic players). In any event, this neutrality is dangerous for the world because it prevents the launch of an effective process to avoid a decade-long tragic crisis to unwind (9).

In this issue of the GEAB, our researchers anticipate the different forms a US default will take at the end of summer 2009, a US default which can no longer be concealed concealable from this April (most taxes are collected in April in the US) onward (10). The perspective of a US default this summer is becoming clearer as public debt is now completely out of control with skyrocketing expenses (+41%) and collapsing tax revenues (-28%), as LEAP/E2020 anticipated more than a year ago. In March 2009 alone, the federal deficit has nearly reached USD 200-billion (way above the most pessimistic forecasts), i.e. a little less than half of the deficit recorded for the entire year 2008 (a record high year) (11). The same trend can be observed at every level of the country’s public organisation: federal state, federated states (12), counties, towns (13), everywhere tax revenues are vanishing, suffocating the whole country with spiraling debts that no one can control anymore (not even Washington).

US tax receipts on corporate income (1930 – 2009) - Sources: US Department of Commerce / Saint Louis Federal Reserve (Q2-Q3 2009 projection by EconomicEdge)

/more, notes... http://www.leap2020.eu/GEAB-N-34-is-available!-Summer-2009-The-international-monetary-system-s-breakdown-is-underway_a3129.html

[54anickel]

24. Those are not very pretty pictures you've posted GD. That last one is just

bizarre. There was so much profit that corp taxes receipts went up even with all of Bush's breaks? Just imagine what could have been if he'd not given all those tax cuts!

[Ghost Dog]

37. That last one reminds me of being at my father's bedside when he died

due to a failed (after 10 years, ok) replacement (pig)heart-valve (but in reverse).

[54anickel]

39. Not a very good prognosis then, is it. You got me thinking....

it's been 9 years for my dad and 10 for my mom now....just doesn't seem like they've been gone that long.

[Demeter]

36. Oh, Good! Only 6 More Months of Smoke and Mirrors!

Then Catastrophe in all its glory will be revealed unto the Masses, and perhaps a few significant Heads will roll....6 months, that's October, of course! The traditional month for Financial Armageddon.

[tclambert]

23. So, I was thinking the U6 number is more than halfway to Depression numbers,

but we have an administration that at least WANTS to do something to help. The Depression began with an economic shrinkage lasting 43 months. Most economists I've heard are saying this one will turn later this year or sometime next year. that would be in the 20 - 30 month range. I dunno, maybe we're more than halfway to a Depression. Maybe on the SWEI scale, we're at a -6.

On the other hand, The Great Depression maybe shouldn't be a -10. I forgot other countries, like Russia and France, where starvation did lead to revolution. The results of both revolutions turned out pretty dismal.

I'll stick with the -5, but it's a very soft number.

[Demeter]

42. Or At Least Wants to Say they Want to Help

and makes some feeble gestures in the general direction of the masses.

[Festivito]

25. Debt: 04/15/2009 11,218,863,034,278.70 (UP 46,564,296,247.29) (Up big.)

(Big rise, and FICA goes up also.)

= Held by the Public + Intragovernmental(FICA)
= 6,937,569,851,513.76 + 4,281,293,182,764.94
UP 44,205,591,028.33 + UP 2,358,705,218.96

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 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.8, ABOUT TEN BUCKS for a 1B$ 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 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,171,515 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,642.41.
A family of three owes $109,927.24. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 24 reports in the last 30 to 33 days.
The average for the last 24 reports is 9,796,368,830.48.
The average for the last 30 days would be 7,837,095,064.38.
The average for the last 33 days would be 7,124,631,876.71.
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$/day.
There were 60 reports in 85 days of Obama's part of FY2009 averaging 0.82B$ per report, 0.68B$/day so far.
There were 135 reports in 197 days of FY2009 averaging 8.85B$ per report, 6.06B$/day.

PROJECTION:
There are 1,376 days remaining in this Obama 1st term.
By that time the debt could be between 13.1 and 21.0T$.
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)
04/15/2009 11,218,863,034,278.70 BHO (UP 591,985,985,365.62 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 1,194,138,137,366.30 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
03/26/2009 +007,175,786,187.90 ------------*********
03/27/2009 -000,468,145,936.78 ---
03/30/2009 +000,069,902,880.68 ------------******* Mon
03/31/2009 +079,841,314,678.25 ------------**********
04/01/2009 -001,742,860,350.87 --
04/02/2009 +007,764,243,786.78 ------------*********
04/03/2009 +028,967,677,130.84 ------------**********
04/06/2009 +000,073,808,356.95 ------------******* Mon
04/07/2009 +000,123,552,400.07 ------------********
04/08/2009 +000,050,639,456.95 ------------*******
04/09/2009 +024,055,285,655.59 ------------**********
04/10/2009 +000,051,156,797.54 ------------*******
04/13/2009 +000,309,440,014.97 ------------******** Mon
04/14/2009 +000,167,862,523.71 ------------********
04/15/2009 +044,205,591,028.33 ------------**********

190,645,254,610.91 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,554,231,231,019.63 in last 209 days.
That's 1,554B$ in 209 days.
More than any year ever, including last year, and it's 153% of that highest year ever only in 209 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 209 DAYS NOT 365.

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=3834046&mesg_id=3834185

[DemReadingDU]

34. Thanks for doing this every day, n/t

[UpInArms]

26. dollar watch

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

Last trade 85.830 Change +0.644 (+0.83%)

Canadian Dollar Forecast to Rally Further Versus US Dollar

http://www.dailyfx.com/story/topheadline/Canadian_Dollar_Forecast_to_Rally1239963784743.html

The SSI sought a EURUSD rally since 1.26 and was signaling a reversal around 1.60.



<snip>

USDCAD – Our forex trading signals remain aggressively short the US Dollar against the Canadian dollar, as a surge in forex crowd buying gave clear contrarian signal to sell. The ratio of long to short positions in the USDCAD stands at 2.05 as nearly 67% of traders are long. Yesterday, the ratio was at 2.23 as 69% of open positions were long. In detail, long positions are unchanged from yesterday and 19.9% stronger since last week. Short positions are 8.7% higher than yesterday and 16.3% stronger since last week. Open interest is 2.7% stronger than yesterday and 30.7% above its monthly average. The SSI is a contrarian indicator and signals more USDCAD losses.

How do we interpret the SSI? The FXCM SSI is based on proprietary customer flow information and is designed to recognize price trend breaks and reversals in the four most popularly traded currency pairs. The absolute number of the ratio itself represents the amount by which longs exceed shorts or vice versa. For example if the EURUSD ratio is 2.55, long customer orders exceed short orders by a ratio of 2.55 to 1. Conceptually similar to contrarian analyses using the CFTC IMM open position data or COT Report, the SSI provides an alternative approach that is both more timely and accurate in forecasting currency price movement. The SSI is a contrarian indicator that tells you how the market is weighted and where the trend may head. More long positions don't necessary suggest more confidence in the direction of the current trend. In general, when traders start having adverse movements against their position, many tend to increase the size of their position with the purpose to average down their entry price in one last attempt to recover from previous losses. However, the higher the number of short orders in a bull market the more dangerous is to take additional shorts because many of those traders who just entered the markets are also leaving their protective stop losses just above the current price action.

...more...

Euro Sunk By Trichet Comments, Will Citigroup and GE Earnings Add To Dollar Strength?

http://www.dailyfx.com/story/bio1/Euro_Sunk_By_Trichet_Comments__1239963611985.html

The Euro dropped to a month low of 1.3056 after dovish comments from ECB president Trichet who confirmed that the central bank is of the view that further easing and additional non-standard measures are needed. The remarks confirmed market expectations that a 25 bps rate cut would come sometime over their next two policy meetings. Meanwhile, the Euro-zone trade balance deficit narrowed to -2 billion from -10.9 billion as imports declined faster than exports. However, the region continues to see demand from its main trading partners weaken which is threatening to extend the current recession.

The ECB from the outside appears to be at odds over whether to cut rates again and embark on quantitative easing measures. President Trichet denied those contentions stating that the committee was united in its thinking. However, recent comments from member Axel Weber cautioning against cutting rates below 1% and purchasing debt appears to be in conflict with some of his peers. George Provopoulos and Athanasios Orphanides have called for further easing and more nonconventional efforts which appear to be the direction that he central bank will take. The euro/dollar has now broken below the 100-day SMA which had been providing support, the 50-Day SMA now appears as the next significant technical level to watch at 1.3038. A break below there could see the pair look to test the 1.2500 price level.

The pound is being dragged lower by the increasing risk aversion as fears grow that earnings releases scheduled today for U.S. financial companies may disappoint. Sterling started to come under pressure after the Council of Mortgage Lenders last night revealed that plunging UK house prices have forced 900,000 mortgage borrowers into negative equity. The housing market continues to deteriorate and there is a concern that the BoE efforts to provide liquidity to the market may not have as significant an impact as expected. This could limit upside potential and keep the pound/dollar range bound as longer-term signals are still pointing toward bullish momentum. We could see support at the 20-Day SMA at 1.4662 which may lead the pair to trade between 1.4600 – 1.5000 over the short-term until we see clearer signs of economic stability.

The dollar has been supported well over night as concerns grow in Europe and risk aversion flows gained momentum. The only major economic release scheduled today is the University of Michigan consumer confidence indicator which is expected to improve to 58.5 from 57.3. The U.S. economy showing signs of stabilizing and the government’s consistent efforts to do whatever it takes to improve conditions has started to have a positive impact on sentiment. Fed chairman Ben Bernanke is speaking today in Washington DC and the central bank leader’s comments always deserve watching. Earnings from GE and Citibank may have the most market moving potential, if the financial giants continue the theme of positive financial sector results we could see risk appetite improve and the dollar weaken. However, if as many expect that they will continue to show scars from the credit crisis, then further dollar support could be expected.

...more...

[BelgianMadCow]

61. So the ECB is probably going into *cough* non-conventional measures"

aka quantitative easing.
We're fucked, too

:-(

[rfranklin]

27. Fantastic! GE and Citi losses beat estimates! Let's party!

INDICATIONS
U.S. stock futures mostly up after GE, Citi results

By Steve Goldstein, MarketWatch
Last update: 7:07 a.m. EDT April 17, 2009Comments: 107LONDON (MarketWatch) -- U.S. stock futures were mostly higher on Friday, as General Electric and Citigroup both beat analyst estimates on their first-quarter results.
S&P 500 futures rose 3.1 points to 864.60 and Dow industrial futures rose 32 points, while Nasdaq 100 futures slipped 2.5 points to 1,349.50.
The 18 cents-a-share loss for Citi (C:Citigroup Inc 4.01, +0.04, +1.0%) and the 26-cents-a-
share earnings from continuing operations profit at General Electric (GE:General Electric Co
GE 12.27, +0.44, +3.7%) both came in ahead of market estimates

http://www.marketwatch.com/news/story/US-stock-futures-mostly-up/story.aspx?guid=%7BEEA9CFB5%2D8E75%2D41F4%2DA69E%2D7057624DA004%7D

[TheWatcher]

29. Bring Out Your Dead!

We're Not Dead Yet!

(You're Not Fooling Anyone, You Know)

We're Not Quite As Bankrupt As We Thought!

(Shut Up, You'll be Stone Dead In A Moment!)

I Think We'll Have A Bit Of A Walk!

We Feel HAPPYYYYYYY! HAPPYYYYY!

[rfranklin]

30. It's a Norwegian Blue, just napping...

"Hellooooo, Polly!"

[TheWatcher]

57. "He's NOT Pining, He's PASSED ON! Bereft Of Life, He Rests In Peace!"

"THIS.....Is An EX-PARROT!"

:rofl:

[DemReadingDU]

32. WooHoo!

:woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo:





:sarcasm:

[Lucky Luciano]

38. With Citi it was really bad bad earnings...

Their own debt that they had issued was worth a lot less this quarter than last, which means they could buy it in the open market for under 100 cents on the dollar - that had a huge positive impact on their earnings.

[Demeter]

43. A Coverup--Wonder if the Sellers Knew Who They Were Selling To

and just didn't care.

[Lucky Luciano]

45. It is not a coverup - it was made perfectly clear on the earnings report.

There were no sellers - it is simply a PnL that is based on marking their debt to market - so it unrealized. Since Citi certainly does not have the cash to buy back the debt, it is unlikely that it will ever be realized - AND if Citi's credit profile improves, then the value of their debt will increase forcing them to give back this unrealized gain. It is legitimate to consider this to be part of PnL though one must be aware of it playing a role. If a company has plenty of cash to spend, then they could benefit from their debt being underpriced in the market by buying it back and saving themselves money on interest and principal payments had they let the debt simply mature.

[Demeter]

46. I Misunderstood

I thought Citi had bought back their debt a huge discount.

[Ghost Dog]

44. ECB, IMF urge action to ensure 2010 recovery

Fri Apr 17, 2009 7:59am EDT TOKYO/LONDON, April 17 (Reuters) - The European Central Bank on Friday led calls for bold action to ensure recovery from the global economic crisis in 2010 as Citigroup (C.N) results added to hopes that the worst may be over.

"Confidence today relies equally upon the audacity of our immediate decisions and upon the soundness of our exit strategies," ECB President Jean-Claude Trichet said in a speech in Tokyo.

He said banks would be the focus of any unconventional measures the ECB unveils next month, when he is expected to join the United States, Japan and Britain in moving beyond rate cuts to spur the economy and credit markets.

Those central banks have announced plans to buy debt from lenders in "quantitative easing" aimed at freeing up banks to lend more to firms and households -- a step some analysts fear will trigger future inflation.

IMF Managing Director Dominique Strauss-Kahn said a "coherent and coordinated" response by countries was vital to recovering from crisis in 2010 and warned that the global economy faced "deeply negative territory" this year.

"Until this is done, attempts to restore demand are likely to falter," he said in a speech late Thursday.

In a sign of how hard the real economy has been hit by slumping global trade, Euro zone exports plunged by a quarter in February from a year earlier and imports by more than a fifth.

The Euro zone fell to an external trade deficit of 2.0 billion euros ($2.62 billion) from a surplus of 1.7 billion a year earlier, said Eurostat.

The crisis threatens to create a "jobs crisis" in Britain this year, Danny Blanchflower, a member of the Bank of England's Monetary Policy Committee, wrote in a newspaper article published on Friday. "Unemployment is going to rise a lot during 2009," he said. "It is probably going to be the biggest issue at the next election," said Blanchflower, who has called for a further fiscal boost of close to 90 billion pounds ($133.6 billion) to tackle unemployment.

/... http://www.reuters.com/article/marketsNews/idINSP40732620090417?rpc=44&sp=true

[Zenlitened]

51. "announced plans... aimed at freeing up banks to lend more to firms and households"

:banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :banghead:

[Ghost Dog]

56. Yup. Eg: Spain’s Bad-Loan Ratio Rises on Deepening Recession

April 17 (Bloomberg) -- Bad loans made by Spanish lenders rose in February, as the deepening recession spurred defaults by companies and consumers.

The bad-loan ratio was 4.18 percent of total credit, compared with 3.87 percent in January and 1.13 percent a year earlier, the country’s central bank said on its Web site today. Loans in arrears leapt to 77.7 billion euros ($102 billion) from 20.1 billion euros.

The slumping Spanish economy, which BNP Paribas SA says may shrink 3.5 percent this year, is driving bad loans to the highest levels in 12 years. Spain mounted its first bank rescue in 16 years last month when the state seized Caja Castilla La Mancha and pledged up to 9 billion euros in guarantees for savings bank.

Spanish savings banks had a loan-arrears ratio of 4.45 percent, up from 1.03 percent a year earlier. The arrears ratio for commercial banks was 3.17 percent from 0.86 percent.

The bad-loan ratio for savings banks was 4.84 percent in February, up from 1.15 percent a year earlier. At commercial banks, it reached 3.45 percent from 0.92 percent. Alfredo Saenz, chief executive officer of Banco Santander SA, predicted Feb. 16 that the industry’s bad-loan ratio may top 8 percent in 2009.

/.. http://www.bloomberg.com/apps/news?pid=20601085&sid=ab35WUy.AyCs&refer=europe

[Demeter]

47. Elizabeth Warren on Daily Show--Educating America One Show at a Time

http://www.thedailyshow.com/video/index.jhtml?videoId=224261&title=elizabeth-warren-pt.-1

http://www.thedailyshow.com/video/index.jhtml?videoId=224262&title=elizabeth-warren-pt.-2

Because she doesn't have the power to STOP this madness.

[Dr.Phool]

49. She seemed very frustrated.

She tried to be upbeat, but you could see the frustration on her face, because nobody at Treasury or the Fed will tell her what in the hell is going on.

I think she's the right person for the job, but she's being marginalized even more than Volcker.

[Demeter]

54. She Is a Wonk--One of Us

she's not glib and sarcastic. Jon played it straight with her, and was very sympathetic and supportive.

[BelgianMadCow]

62. give the woman a MEGAPHONE puhleeze

thanks for the pointer, great stuff.

[TalkingDog]

59. Woo-Hoo! 590 points!!!!

oh, wait.....never mind.

Hey ya'll, have a great weekend.

TD

[RUMMYisFROSTED]

60. If you had only bought at 5.80!

:cry:

[Demeter]

63. And On to the Weekend!

Join us on Weekend Economists' Thread, in the Editorial Section, where if we can't dazzle you with brilliance, we can depress you with reality or baffle you with bullshit. I'm thinking of taking up drinking, myself....it's all Doc's fault, too.

Demeter