STOCK MARKET WATCH, Tuesday October 7

[ozymandius]

Source: du

STOCK MARKET WATCH, Tuesday October 7, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 105
DAYS SINCE DEMOCRACY DIED (12/12/00) 2814 DAYS
WHERE'S OSAMA BIN-LADEN? 2539 DAYS
DAYS SINCE ENRON COLLAPSE = 2830
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

In recognition of those prescient of the Dow's precipitous return of Bush values (9/29/08): JuneBourder and AnneD

AT THE CLOSING BELL ON October 6, 2008

Dow... 9,955.50 -369.88 (-3.58%)
Nasdaq... 1,862.96 -84.43 (-4.34%)
S&P 500... 1,056.89 -42.34 (-3.85%)
Gold future... 866.20 +33.00 (+3.96%)
30-Year Bond 3.94% -0.18 (-4.39%)
10-Yr Bond... 3.43% -0.22 (-5.98%)






GOLD,EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp

If Pigs Could Fly
BY ROB KIRBY

Interesting times we live in, eh? Our global financial markets have metamorphosed more in the past fortnight than they did in the previous 14 years. Here’s a recap as to why, paying specific attention to the build-up of DERIVATIVES, and their unraveling which is causing so many of the dislocations that are now manifesting themselves.

The great unwinding we are now witnessing had its roots in myth – The Strong Dollar Policy. This myth was a conceptual concoction of former Treasury Secretary Robert Rubin and his protégé Lawrence Summers (with an academic “assist” to Barsky and the Harvard Economics Department):

-see chart-

That the U.S. Dollar rallied from the 1995 time period is a matter of historical fact. In the past, soothsayers such as Sir Alan of “Bubbles” Greenspan have tried to entertain us into believing that the Dollar’s ascent was due to paradigm-shift or “The Great Productivity Miracle.”

Now we know better.

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

[Hugin]

14. Funny 'toon.

:lol:

I get that one!

Nice job Toles has done.

[Name removed]

57. Deleted message

Message removed by moderator. 
[link:www.democraticunderground.com/forums/rules.html|Click
here] to review the message board rules.

[54anickel]

79. Whoa, I thought I was the only one who ever got deleted from the SMW thread. Wonder what that was?

[Ghost Dog]

80. Anti-Obama caricatures. Artistically clever but out of place here... n/t

[54anickel]

82. Ahh, thank you. Just to be clear, I never posted any of THAT sort of trash!!!

[Hugin]

93. Charming...

Glad I missed it :eyes:


My main 'puter crashed a couple of hours ago. I am on a backup device.

[Demeter]

96. Condolences, Prag

I HATE when that happens! I haven't recovered from my May crash, yet!

[Hugin]

100. Thanks

A chip on graphc is overheating (dust)


Entry is slow. :/

[NeoConsSuck]

2. Bank of America Sells Stock, Cuts Payout as `Recession' Worsens

Bank of America Corp., the lender that is buying Merrill Lynch & Co., is preparing for a weaker economy by slashing its dividend in half and raising at least $10 billion in a sale of common stock.

The dividend was cut to 32 cents a share, the Charlotte, North Carolina-based bank said yesterday. Chief Executive Officer Kenneth Lewis said the U.S. economy slowed in the past 45 days with little prospect for immediate improvement.

``The recession is going to be a little deeper than we thought,'' Lewis said on a conference call. ``It's going to take some more time and some more pain.''

http://www.bloomberg.com/apps/news?pid=20601087&sid=as2BgoJzPq3M&refer=home

WOW! The 'R' word is used for the first time by a major bank!

[NeoConsSuck]

5. Bank of America profits plunge 68%

NEW YORK (CNNMoney.com) -- Bank of America proved it was not invulnerable to the credit crunch as it reported a steep decline in earnings on Monday, and announced plans to bulk up on capital by slashing its dividend in half and raising $10 billion through a stock sale.

Making the surprise announcement just after the closing bell, the Charlotte, N.C.-based bank said its third-quarter net income fell to $1.18 billion, or 15 cents a share, down 68% from $3.7 billion, or 82 cents a share, a year ago.

That was far worse than Wall Street's consensus forecasts of a net profit of $3.22 billion, or 62 cents a share.

Bank of America (BAC, Fortune 500) shares, which fell 6.5% during the session Monday, tumbled more than 9% in after-hours trading on the news.

http://money.cnn.com/2008/10/06/news/companies/bank_of_america/index.htm?cnn=yes

[ozymandius]

3. Today's Reports

4:00 FOMC Minutes Sep 16

15:00 Consumer Credit Aug
Briefing.com NA
Consensus $5.0B
Prior $4.6B

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

[UpInArms]

167. FOMC minutes

01. Fed also discussed how to reverse easing at Sept meeting
2:00 PM ET, Oct 07, 2008

02. Rate cut 'not called for' at Sept. Fed meeting: minutes
2:00 PM ET, Oct 07, 2008

03. Rate cuts may be used if markets worsen: Fed minutes
2:00 PM ET, Oct 07, 2008

04. Some on Fed put rate cut on table at Sept. meeting: minutes
2:00 PM ET, Oct 07, 2008

[UpInArms]

178. Aug. consumer credit down record $7.9 billion - credit drop first since Jan. '98

01. U.S. Aug. consumer credit drop first since Jan. '98
3:00 PM ET, Oct 07, 2008

02. U.S. Aug. consumer credit down at 3.7% rate
3:00 PM ET, Oct 07, 2008

03. U.S. Aug. consumer credit down record $7.9 billion
3:00 PM ET, Oct 07, 2008

[ozymandius]

4. Oil rebounds to $89 after falling to 8-month low

SINGAPORE - Oil prices rebounded to around $90 Tuesday in Asia after plunging to an 8-month low Monday on concerns a significant slowdown in global economic growth will undermine demand for crude.

"Prices have moved so far, so fast," said David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney. "I certainly wouldn't say the bounce today is indicative that we've reached a bottom in oil prices."

Light, sweet crude for November delivery was up $2.05 to $89.89 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract fell overnight $6.07 to settle at $87.81, the lowest level since Feb. 6.

....

In other Nymex trading, heating oil futures rose 5.86 cents to $2.53 a gallon, while gasoline prices gained 4.85 cents to $2.11 a gallon. Natural gas for November delivery rose 6.9 cents to $6.90 per 1,000 cubic feet.

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

[Demeter]

97. Gas is $3.32 at Ann Arbor Pumps this morning

[Roland99]

6. Stock futures flat to negative

DJIA INDEX 9,941.00 -23.00 05:31
S&P 500 1,053.00 -0.30 05:31
NASDAQ 100 1,414.00 +7.50 05:29

[ozymandius]

7. Europe governments go their own way on crisis

LONDON - Individual European governments issued a flurry of deposit guarantees to shore up their banks but fell short of any coordinated action Monday to deal with the crisis sweeping financial markets, even as stock markets crashed and the euro sank to its lowest level for over a year.

Though Europe's officials appeared to be paying lip service to the need for working together, they continued to make key announcements on deposits on a go-it-alone basis.

France, which holds the rotating leadership of the European Union, said its 27 governments have each pledged to take "all necessary measures to ensure the stability of the financial system" but no joint action was forthcoming, fueling the belief that the crisis would be handled differently by each country.

...

Iceland and Denmark followed Monday with a deposit guarantee, in the former's case only once trading in the shares of six of its banks had been suspended.

Markets responded to the disarray by sinking rapidly, following selloffs in Asia. Russia shut down both its stock markets after they fell more than 15 percent.

...

Faltering confidence in the financial system following a series of bank bailouts forced governments to offer deposit guarantees, analysts said, since failure to match those offered by Ireland, France, Greece and Sweden could risk a massive funds outflow.

http://news.yahoo.com/s/ap/20081007/ap_on_bi_ge/eu_europe_meltdown

[ozymandius]

8. Iceland's banks falter

REYKJAVIK, Iceland - Iceland's banks face a battle for survival Tuesday after government introduced emergency legislation to give itself sweeping new powers over its collapsing financial sector.

Prime Minister Geir H. Haarde warned late Monday that the heavy exposure of the tiny country's banking sector to the global financial turmoil was raising the specter of "national bankruptcy."

The government's attempt to gain control of the increasingly dire situation and restore some confidence in the country's hard-hit banking sector followed a day of panic Monday that saw trading in shares of major banks suspended and the Icelandic krona shrink in value against the euro.

.....

Investors are now punishing the whole country for the banking sector's heavy exposure to the global credit squeeze — its currency has gone through the floor, imports have fallen and inflation is soaring.

http://news.yahoo.com/s/ap/20081007/ap_on_bi_ge/eu_iceland_banks

[ozymandius]

11. Iceland Central Bank Receives 4 Billion Euro Loan From Russia

Oct. 7 (Bloomberg) -- Russia agreed to lend Iceland's central bank 4 billion euros ($5.43 billion) to inject liquidity into the financial system, the bank said.

The loan will run over three to four years and cost as much as 50 basis points, or 0.5 of a percentage point, more than Libor.

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=azotRtS9KH8M

[Ghost Dog]

35. Iceland takes over second biggest bank, Russia hovers

Tuesday October 7, 8:10 am ET REYKJAVIK (Reuters) - Iceland took over its second largest bank, propped up a battered currency and said on Tuesday it hoped Russia would lend 4 billion euros ($5.44 billion) to help tackle a financial crisis threatening to overwhelm it.

Clouding a rapidly-escalating emergency, Russian deputy finance minister Dmitry Pankin told Reuters no decision had been taken to lend money.

But Iceland's prime minister, Geir Haarde, said government officials would go to Moscow to discuss the terms of the loan, which would bolster the country's foreign reserves.

He said Iceland would not default on its sovereign debt.

"People from our side will be going to Russia today or early tomorrow morning to discuss the exact terms," Haarde told a news conference. "With this, like everything else, nothing is certain until it's certain."

/... http://biz.yahoo.com/rb/081007/business_us_financial_iceland.html?.v=3

[ozymandius]

9. UK bank funding talk hits stocks, sterling

LONDON (Reuters) - World stocks fell again on Tuesday and sterling hit a 2-1/2 year low after talk of government funding hit UK banks, erasing gains in the benchmark index made after Australia's surprisingly large interest rate cut.

Royal Bank of Scotland fell more than 30 percent while Lloyds also lost 18 percent after traders cited speculation of funding talks with the government.

.....

Earlier, Australia cut interest rates by a full percentage point to 6 percent, its biggest move in 16 years. This has boosted speculation other major countries might follow suit, especially as finance chiefs from Group of Seven rich countries meet in Washington this weekend.

Interbank money markets -- blocked for months by banks' refusal to lend to each other -- remained log jammed, with the cost of borrowing euros for three-month staying as high as 5.38 percent on Reuters system.

http://news.yahoo.com/s/nm/20081007/bs_nm/us_markets_global

[ozymandius]

13. Barclays, RBS in Talks on U.K. Government Funding (Update3)

Oct. 7 (Bloomberg) -- The U.K. government may invest at least 45 billion pounds ($79 billion) in banks including Royal Bank of Scotland Group Plc and Barclays Plc to bolster capital depleted by mortgage-related losses, two people with knowledge of the situation said.

....

RBS fell as much as 39 percent after Standard & Poor's cut the company's credit rating for the first time in almost a decade, as the Edinburgh-based bank's financial condition deteriorates. The government has already bailed out Bradford & Bingley Plc and brokered the takeover of HBOS Plc in the past month on concern about the banks' ability to fund themselves. Darling said yesterday he will do ``whatever it takes'' to keep the financial system stable as capital markets remain frozen.

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

[Ghost Dog]

54. EU can't say if talking to UK on possible bank plan

Tue, Oct 7 2008, 10:45 GMT BRUSSELS, Oct 7 (Reuters) - The European Commission declined to say on Tuesday whether it was in touch with British authorities over speculation of possible new measures to shore up British banks.

"We are in regular contact with the UK authorities, I cannot at this stage say whether we have been in touch on this specific point ... which has not yet been announced," a Commission spokesman told a regular news briefing.

"If they were to take such a step the Commission would have to analyse the details ... whether there was any state aid involved and if so whether that state aid is compatible with EU rules," he added.

/.. http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=a4e448b9-fb92-4027-afa1-721e9327f9fe

[ozymandius]

55. Do they think we're dumb?

Declining to comment on the question of such significance, under these weighty circumstances, points to one answer: Yes.

How could they not discuss something (or possibly avoid mentioning anything) of such paramount importance?

[Ghost Dog]

63. Absolutely. But since the Brits have made no official announcement yet...

:shrug: (Welcome to high-level EU politics) ;)

Steve Bell

[Ghost Dog]

40. Barroso warns of renationalisation of financial system

Tue Oct 7, 2008 8:25am EDT LISBON, Oct 7 (Reuters) - A succession of national responses by European Union countries may lead to a "renationalisation" of the financial system, which would harm integration, European Commission President Jose Manuel Barroso said on Tuesday. He also warned that aid by EU member states to their financial sectors amid the global crisis should not lead to competition distortion, adding that the sheer size of some European banks was making national solutions insufficient.

His comments reflect Brussels' concern that member states are ignoring the EU single market rulebook, notably concerning limits on state aid to industry and budget discipline, in their haste to react to the market turmoil.

"A succession of national responses may cause the renationalisation of the European financial system, which would be a setback for European integration," Barroso told a conference on European prospects in Lisbon.

"I want to underline that the fundamental principles of the single market cannot be compromised. It would be unacceptable that measures aimed at helping the banks in trouble would be used to strengthen their positions compared to competition," Barroso said, calling for a joint "European solution".

/... http://www.reuters.com/article/marketsNews/idINL718185320081007?rpc=44&sp=true

[Ghost Dog]

49. Europe reacts to the global crisis

Tue, Oct 7 2008, 09:11 GMT FXstreet.com European countries are planning to take their first specific joint actions in order to protect the small private investor from the financial crisis. The finance ministers of the Euro Zone reached an agreement, which still must be approved by the EU27, to raise the maximum bank deposits guarantee to 40,000 euros.

According to the Commissioner of Economic and Monetary Affairs, Joaquin Almunia, if the proposal receives this support, the European Commission will work on another initiative to raise the amount even more. They will also try to make those changes effective as soon as possible.

The Commission's decision follows the unilateral measures taken by several European countries to provide full guarantee to the funds deposited in their own territory. These countries tried to give some stability and confidence to the savers. The EU now wants to unify these measures and establish a more coherent system.

/... http://www.fxstreet.com/fundamental/analysis-reports/special-coverage/2008-10-07.html

I think, the word "maximum" in this piece above should read "minimum"...

See comments from EU Finance Ministers' meeting this morning, eg:

... ECOFIN'S LAGARDE

On changing mark-to-market rules:

"In particular we asked for this to apply to accounts for the third quarter of 2008."

On bank deposit guarantees:

"After the meeting in Paris, and the Paris declaration, after the communique of the 27 yesterday, we wanted to find a common position to strengthen our coordination ... we have succeeded."

...

"We have reiterated our determination to guarantee the stability and solidity of the banking system ... we have made this explicit and we are prepared to envisage all measures to attain this objective."

"We agreed to raise the minimum guarantee to 50,000 euros while noting that many member states were determined to raise this to 100,000 euros."

IRISH FINANCE MINISTER BRIAN LENIHAN

...

Asked whether Ecofin ministers would discuss harmonising deposit insurance:

"That is an issue we are going to discuss, so clearly anything we can do to give greater confidence among depositors is very important. We don't want these movements taking place between accounts all the time."

"One country on its own can't solve the problem."

Asked if the EU should raise the minimum level of guaranteed deposits to 100,000 euros from 20,000 euros:

"That is a matter that is under consideration. Certainly anything that can stop the movements between accounts would be very welcome."

DUTCH FINANCE MINISTER WOUTER BOS

On bank deposit guarantees:

Asked what level would be a good level for harmonising the bank deposit guarantees: "That's what I'm going to discuss"

Asked whether 100,000 euros would be a good level: "Maybe. We will see"

/... http://www.reuters.com/article/marketsNews/idINL761755420081007?rpc=44&sp=true

[Demeter]

98. This is One Situation Where "Integration" May Not Make Any Sense, Anyway

[ozymandius]

10. Fed Sets Floor Below Rate Target, Engineering `Stealth' Cut

Oct. 7 (Bloomberg) -- The Federal Reserve may have trimmed borrowing costs yesterday without actually saying so.

The central bank used power granted under last week's financial-rescue legislation to effectively set a floor under its main interest rate that's lower than the 2 percent target set by policy makers last month. The Fed may now pay interest on bank reserves while it floods financial markets with liquidity, pushing down the overnight lending rate by about 0.75 percentage point to 1.25 percent.

.....

The announcement, and a Fed decision to double the auction of cash to banks to as much as $900 billion, failed to avert a 3.9 percent decline yesterday in the Standard & Poor's 500 Index. The index has tumbled 28 percent this year even as the central bank has expanded credit more than at any time in seven decades, including a 3.25 percentage-point cut in the main rate during the past 13 months.

.....

The 0.75-point spread, announced yesterday, was the biggest surprise in the Fed's moves to implement its authority under the financial-rescue legislation, economists said. The Fed set the new rate Oct. 3, the same day the House approved the bill and President George W. Bush signed it into law.

http://www.bloomberg.com/apps/news?pid=20601087&sid=a2KRwOfPJk58&refer=home

[ozymandius]

12. Money-Market Rates Climb to All-Time Highs as Freeze Deepens

Oct. 7 (Bloomberg) -- Money-market rates in Europe climbed to records as U.K. lenders held talks with the government on emergency funding and Iceland took steps to bolster its banks amid an unprecedented credit squeeze.

The euro interbank offered rate, or Euribor, that banks charge each other for three-month loans rose 3 basis points to 5.38 percent today, the eighth straight all-time high, the European Banking Federation said. The Tokyo interbank rate stayed at the highest level this year and the Libor-OIS spread, a gauge of cash scarcity among banks, widened to a record.

.....

The seizure in global credit markets is deepening on speculation central bank attempts to revive lending between financial institutions won't work, resulting in more bank failures. The U.K. government may invest $79 billion in some of the nation's banks to bolster their capital, two people familiar with the matter said. Iceland's Financial Supervisory Authority said it took control of Landsbanki Islands hf, the country's second-largest lender.

The Libor-OIS spread, the difference between the three- month dollar rate and the overnight indexed swap rate, climbed 3 basis points to 292 basis points today. The average was 8 basis points in the 12 months to July 31, 2007, before the credit squeeze began.

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=aTL01FeOaMvs

[ozymandius]

19. Bernanke is tearing out what's left of his hair.

This is happening in the U.S. This is exactly the opposite of what Bernanke and Paulson wanted banks to do with the spirited bailout plan.

Here's analysis from Mike Shedlock:

Failures of the TAF

The TAF did not spur bank to bank lending yet Bernanke keeps throwing more money at it as if it would do some good. It won't. I talked about Failures of the Term Auction Facility on April 10, 2008.

There is "no empirical evidence" the Term Auction Facility has reduced the premium that banks charge each other to lend cash for three months, Taylor, author of a monetary-policy formula cited as a benchmark by analysts, wrote in a research paper. San Francisco Fed economist John Williams co-wrote the study, which was posted on the San Francisco Fed's Web site yesterday.

The Fed's own website has a study showing why the TAF will not work but Bernanke keeps banging his head against a brick wall anyway. Bernanke might be advised to read the Fed's own report. Here is the conclusion.

In this paper we documented the unusually large spread between term Libor and overnight interest rates in the United States and other money markets beginning on August 9, 2007. We also introduced a financial model to adjust for expectations effects and to test for various explanations that have been offered to explain this unusual development.

The model has two implications. Fist is that counterparty risk is a key factor in explaining the spread between the Libor rate and the OIS rate, and second is that the TAF should not have an effect on the spread. Since the TAF does not affect total liquidity, expectations of future overnight rates, or counterparty risk, the model implies that it will not affect the spread. Our simple econometric tests support both of those implications of our model.

more...

Bernanke Theories All Failing

* The Term Auction Facility (TAF) is not working to increase bank to bank lending.

* The Primary Dealer Credit Facility (PDCF) was supposed to prevent more dealers from blowing up. Yet, Lehman went bankrupt anyway and Merrill Lynch had to merge with Bank of America to avoid collapse.

* Slashing interest rates to 2% did not prevent a recession.

* The ABCP MMMF Liquidity Facility may have stopped a run on money markets but it has not done anything to restore confidence in in the ABCP market itself.

http://globaleconomicanalysis.blogspot.com/2008/10/pushing-on-string-in-academic.html

[54anickel]

41. Too bad, huh. All those years he spent studying the Great Depression, thinking he could have beat

it...he had a plan, actually hoped to someday have the chance to "try 'er out".

Well, here we are Ben. Your plan ain't working, so how's about we try your plan B?

What's that? You want a larger chopper? You don't have a plan B, do ya?

We.are.so.screwed.

[ozymandius]

48. Here's the thing.

The Fed in 1930 did exactly the opposite of what the Fed is doing today. The Fed then was stingy. It raised interest rates. A flood of liquidity could have helped critical sectors of the system. J.P. Morgan knew this. This is what he orchestrated with the other big banks in 1907. It worked then. Why isn't it working now?

Then the Smoot Hawley Act of 1931 hammered in the last nail on that economic coffin. Heavens help us if something so bone-headed were to be enacted now.

Plan B? What Plan B? I say you're right. Bernanke is out of ideas. He's already pushing the boundaries of the Fed's charter rules as it is.

[54anickel]

56. I think poor Ben suffered from tunnel vision while working on his thesis. This is NOT the same as

what happened in the '30s. Sure there are simularities on Main Street, but(and maybe I'm misunderstanding derivatives here) there's that extra layer of MBS that have been sliced and diced with pieces sold as "insured" AAA-double-plus-good polished turds...he's throwing money at it while there is no there there. If you're gonna throw money at it, start at the bottom, offer refinancing to stop the foreclosures. The whole problem is that there were more foreclosures than the percentage allowed for in the slicing and dicing of the MBSs. Get those numbers down first by salvaging the salvagable, that would take care of a multitude of issues UP-stream.

Ben appears to be functioning out of his understanding of the world circa 1930. It's like trying to put out a grease fire with water, chances are pretty damned good you're gonna make it worse.

[ozymandius]

64. Indeed.

At the very basic level - your response is the answer to my (somewhat) rhetorical question. Finance is far more complicated than it was eighty years ago. Even the people who designed these exotic schemes do not understand the unintended consequences of things like Credit Default Swaps and Collateralized Debt Obligations.

Ben's deep over his head.

[Ghost Dog]

69. Karl Polanyi?

... the average citizen has a far more important plot to unravel: how did we get in this mess, and how do we make sure it doesn’t happen again?

Answering these two questions does not require a crash course in high finance and economics, because this crisis is as much about politics and ideology as anything. If you’re pressed for time, the reading list can be very short. Key is Karl Polanyi’s The Great Transformation, published in 1944, an economic history which sets out to explain 1929, the Great Depression and the rise of fascism. Polanyi’s book came out the same year as another influential Austrian economist, Friedrich Hayek, brought out the central text of neoliberalism, The Road to Serfdom.

Hayek became the founding father of a model of economic management which has brought us to the current crisis; Polanyi, with extraordinary prescience, warned that the crisis would come; he rejected the idea that the market is a “self-regulating” mechanism which can correct itself. There is no “invisible hand” such as the neoliberals maintain, so there is nothing inevitable or “natural” about the way markets work: they are always shaped by political decisions.

At the time Polanyi was writing, there were many who agreed with him that free-market capitalism was chronically and destructively unstable, with terrible political consequences. But in the 1970s and 1980s, Hayek’s neoliberalism began to take hold on the U.S. ruling elite, Margaret Thatcher was recruited — and in due course Tony Blair and Gordon Brown. “Roll back the state, leave the economy to run itself” has held sway ever since. As Ann Pettifor points out on her website, debtonation.org, Alan Greenspan wrote enthusiastically in August that “the past decade has seen mounting global forces (the international version of Adam Smith’s invisible hand) quietly displacing government control of economic affairs.” He blithely continued that the greatest danger facing the economy was that “some governments, bedevilled by emerging inflationary forces, will endeavour to reassert their grip on economic affairs.” Last week, Greenspan did a gigantic volte-face as he pleaded for government to do just that — reassert its grip in the form of the bail-out.

/... http://www.hindu.com/2008/10/07/stories/2008100755560900.htm

[Joe Chi Minh]

261. A moral philospher, Adam Smith wanted to prevent businessmen conspiring

against the common good, which he considered inevitable unless their machinations were kept in check by government, since in his view, they were by their very nature, deeply subversive conspirators. He intimated, however, that, while, given their endemically recidivistic proclivities, it was a waste of time appealing to their better nature, appeal should be made to their self-interest. Their ultra-worldly proclivities needed to be exploited, not totally rejected as irredeemably disgraceful. We all of us have a body as well as a spirit, and both need to be catered for and developed. Grace builds upon Nature. And that applies to all of us, and will do until our dying day.

He would have angrily abhorred this neo-liberal, corporatist lunacy, the sovereign and comprehensive hegemony of open-ended greed over every aspect of society via government, itself. The geopolitical autonomy of the multinationals, together with outsourcing, would have seemed the last straw. As, indeed, they have proved. In fact, neo-liberalism is the precise antithesis of Smith's prescriptions: as the Chicago boys (or the Neocons) might have put it, "Let the corporations run the country".

"· "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
Second, he believed that workers deserve a living wage:
· "It is but equity ... that they who feed, clothe and lodge the whole body of the people, should have such a share of the produce of their own labor as to be themselves tolerable well fed, clothed and lodged."
Third - and here's a real shocker - he believed that the wealthy should pay more in taxes:
"The subjects of every state ought to contribute toward the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state."
Fourth, he believed in the necessity of public investments in infrastructure and public goods. He spoke of the duty of government to support "public institutions and those public works, which, though they may be in the highest degree advantageous to a great society, are, however, of such a nature that the profit could never repay the expense to any individual or small number of individuals, and which it therefore cannot be expected that any individual or small number of individuals should erect or maintain."

If he were alive today, he would probably consider education and health care as examples of this kind of public goods."

From the article by Rick Wilson under this link:

http://www.commondreams.org/archive/2007/09/23/4046

[AnneD]

89. Morning Marketeers......

:donut: Once, when I was a cocky young thing, I swore I wouldn't make the same mistakes in raising kids that my mother had. And I held true to that notion, but I discovered early on that I was making different mistakes and that despite my best efforts, I was as just as prone to making mistakes-al beit different ones when bringing up my child. There is no such thing as a perfect human-we had one once and we killed him. We don't have a good track record here.

Bernanke suffers from that same delusion, and I do feel sorry for him. Greenscam screwed the pouch and Ben will be blamed.

This is why I was not so fond of a bale out. Folks got themselves into this and they need to face up to it. This bailout simply gives us a new set of problems which may turn out to be worse. Well too late now the dye is cast. Time to get some smart folk into the room with fresh ideas.

Happy hunting and watch out for the bears.

[Ghost Dog]

59. But the "liquidity" is not liquid, it's frozen as it reaches the banks.

Nationalise or at least impose necessary (non-neocon/lib) management changes at all the banks.

[ozymandius]

74. Agreed. That term 'liquidity' is misapplied. nt

[Ghost Dog]

76. Get ahead of the game (Elliott, Guardian)

Now the denial is over, there are three key tasks: in philosophy, in policy, and practical action

o Larry Elliott
o The Guardian,
o Tuesday October 7 2008

Shares tumbled. Gordon Brown's economic war cabinet met. The Americans injected another dollop of money into the markets. Iceland was going bust. Just another day in the life of financial markets, now apparently in a state of permanent crisis.

Let me kick off this new daily column, designed to explore ways of getting out of the mess we're in, with three challenges facing policymakers. The first is philosophical: much of the past year has been wasted because finance ministries, central banks and international bureaucracies have clung on to a bankrupt ideology. Now the period of denial is over, and that has at last opened up the possibility of a more vigorous policy response. But there is still a reluctance to see the crisis as an opportunity as well as a threat; to put in place the long-term reforms that will stop the lunatics taking over the asylum again.

The second challenge is to get the policy framework right. There is absolutely no point in the state taking a stake in the banks or in buying up their "toxic waste" if macroeconomic policy is eye-wateringly tight. Patience with Mervyn King is wearing very thin in Whitehall, not just because of his hardline opposition to cuts in interest rates but over what is seen as a foot-dragging approach to sorting out the banking system.

Alistair Darling is now not even bothering to disguise his view that it is time for the Bank of England to cut interest rates, and if it doesn't ease policy by half a point this Thursday there will be demands for the chancellor to run monetary policy himself. Rightly so. The only thing that matters in wartime is winning the war. Britain is not alone in suffering from a lack of policy co-ordination; the fact that Angela Merkel announced Germany's go-it-alone guarantee for savers, just hours after Nicolas Sarkozy's summit ended with a declaration of European unity of purpose, is indicative of a wider malaise. Finance has gone global but governance has not.

Finally, policymakers need to draw up a "to do" list. They have to get ahead of the game. For 14 months they have been reacting to events, with disastrous consequences. Sorting out the banks' problems is the first priority, and it was the extreme stresses in the money markets, with the knock-on effects for businesses trying to raise capital, that spooked the Treasury at the end of last week. There should be a blanket guarantee to all depositors and a commitment to use taxpayers' money to recapitalise strategically important banks. The support should come at a price: root and branch reform of the way banks operate.

A bail-out for the banks should be accompanied by a coordinated easing of policy to inject confidence into both financial and consumer markets. Finally, this weekend's meeting of the IMF and World Bank in Washington should be used to sketch out a new international financial architecture. Robert Zoellick, the World Bank's president, made a contribution to this debate yesterday when he called for the anachronistic G7 to be expanded to include seven leading developing countries. That would be sensible, as would toughening up credit rating agency rules and a general beefing-up of the IMF's early warning role in spotting crises.

This list does, however, contain one crucial omission - the role of tax havens in undermining the policies of sovereign states. As Richard Murphy of the Tax Justice Network noted yesterday, tax havens provide a "get-out-of-regulation free" card for banks faced with tougher sanctions. This card needs to be taken off the table - but to do so will require the sort of global policy coordination so sorely lacking in recent years.

/comments... http://www.guardian.co.uk/commentisfree/2008/oct/07/creditcrunch.marketturmoil

[Joe Chi Minh]

262. What a great article. I don't pretend to understand it in any appreciably

technical sense, but its thrust is clear; as is the sense that the author has a sound overview of the problems and the avenues to pursue to solve them.

[Demeter]

99. Because Last Time, It Wasn't a Case of Counterfeit Dollars

which is exactly what we have with all these derivative "products". The merry band of Lords of the Universe have been shown to be just ordinary crooks--and they claim they didn't know any better....

So people exchanged hard-earned "real" money for phoney securities, and now they want the real money back.

Last time, people were mortgaging their futures in expectations that inflation would bail them out. This time, the Big Guys mortgaged the entire population.

[radfringe]

15. relevant back in March, relevant now

[ozymandius]

16. And yet the trickle philosophy is still being pursued.

That has an evergreen quality, Rad, even beyond the Bush kleptocracy.

[Hugin]

18. Yes, I saw it mentioned only yesterday...

As, an apologist's explanation of how the top-end bailout was going to save the 'rest-of-us'. I couldn't believe it.

Bad ideas never die. They only get in the way of good ideas.

[rfranklin]

24. You can't argue with people who have faith in fairytales...

they believe because...well, because they believe.

[not fooled]

227. And they make a great rationalization...

...for greed.

[Wednesdays]

58. AN apologist's explanation?

Shoot, there's still a whole chorus of apologists here on DU. They sound like they're reading from *'s faxes hot off the press.

[Dr.Phool]

71. I think the election will clear a lot of them out.

They just got caught up in Obamamania, and don't really have the understanding or experience to understand or at least be skeptical of bullshit, no matter which side it's coming from.

[Ghost Dog]

70. In the face of apocalypse, heed not horsemen's advice (Toynbee, Guardian)

Brown should tread waryof the City voices in his economic war cabinet. Now more than ever, the poor must come first

A remarkable 10,000 people marched on Trafalgar Square at the weekend to hold the government to its promise to end child poverty. Planned long ago, its message was suddenly more poignant as government revenues shrink and bank-rolling banks takes top priority. As all these parents and prams marched past the Treasury, the irony will not have been lost on many inside. The poverty of people like these is directly to blame for the day of reckoning now thundering in on us all. Who caused this crash? People too poor to pay their rent, let alone mortgages, people in mobile homes whose imaginary income streams were securitised into the toxic products that now choke the arteries of banks.

An 8% stockmarket fall was a terrifying spectacle for the new National Economic Council - the war cabinet - meeting for the first time yesterday, but let's not forget the awful poetic justice being played out here. It is the extremes of inequality in the west's most unequal countries that set off this nuclear explosion. Gargantuan bonuses in Wall Street and the City were earned from creating fairy money, imagined to be owned by people too poor to pay anything at all. If the poor had more money, it wouldn't have happened. If mega-bonuses had not inflated share prices and borrowing beyond reason, fantasy capitalism would have been avoided.

In the boom decade, defenders of the hyper-rich said there was no connection between earnings at the top and at the bottom. Top City earners, interviewed for my book Unjust Rewards, were breathtaking in their certainty that they were creating wealth for all. They were sure their own hermetically sealed world neither impacted on anyone else nor was vulnerable to anyone else: all criticism was envy or communism. Now they are taking everyone down with them, putting pensions, jobs and homes in peril for millions.

There is, however, no sign of remorse. Sir Martin Sorrell just moved the tax domicile of his WPP advertising colossus to Dublin to avoid British taxes. He will not be moving there himself, nor will many staff. He prefers London, just as he likes a British knighthood. The company is now incorporated in Jersey, which has no corporation tax, and has a tax residence in Ireland. So is he the object of official criticism? On the contrary, he has just been appointed as chair of Boris Johnson's international business advisory council to encourage companies to locate in London. After a six-hour meeting of the council's 35 company chairmen, Johnson emerged to warn that other enterprises might move overseas, "where they feel tax demands are fairer".

But whose fairness? Gordon Brown says from now on, fairness will be his defining mission: he has another chance this week to start all over again, as he says again it's time for change. Parliament has returned after a long summer to a changed world with worst-case possibilities of horrendous proportions. Just-in-time food delivery, paid for with what? If banks stop paying, just as they have stopped lending, nationalising the entire banking system for a while is no longer absurd. Unlikely? Yes, but its the kind of possibility all governments are staring in the face. The question is whether this government can shape the changed landscape and frame the language of this moment.

/... http://www.guardian.co.uk/commentisfree/2008/oct/07/brown.economic.policy

[DemReadingDU]

29. That's a good one!

[antigop]

39. great 'toon, rad! Perfect! n/t

[ozymandius]

17. Willem Buiter: Banking System in North Atlantic Probably Insolvent

From Naked Capitalism

Willem Buiter has a penchant for ruffling feathers with his blunt pronouncements. He caused a firestorm at the Fed's recent Jackson Hole conference by, in his presentation, telling the central bank that it was a victim of "cognitive regulatory capture" and was excessively sensitive to the needs and special pleading of the financial services industry. Even though the hosts took umbrage, they should not have been surprised, since Buiter had been saying that sort of thing for months.

Buiter lobbed another bombshell today, but because it was presented on his blog and (needless to say) the market meltdow was attention-grabbing, it appears to have gotten little note:

It’s reasonable to assume that the banking system in the North Atlantic region is insolvent and would be bankrupt but for the reality of recent government bailouts and the expectation of future government bailouts. Certainly, for the system as a whole, the marked-to-market value of its assets is way below that of its liabilities. I strongly suspect that even the hold-to-maturity value of its assets is well below that of its liabilities. Although the system as a whole is broke, there are no doubt individual banks that are solvent. We may not, however be certain as to which banks are solvent and which banks are not.

....

More important, Buiter suspects that the banks as a whole are insolvent even if they hold assets to maturity. In other words, the argument that bank distress is due in large degree to mark-to-market pricing meeting a panicked flight to quality is wishful thinking. While many readers of this blog would agree with that view, it's quite another for an economist with considerable central bank/regulatory experience to voice that opinion.

[ozymandius]

20. Fed Planning Credit Default Swap Marketplace

Officials at the Federal Reserve plan to meet with top executives from two commodities exchanges in an effort to create a new marketplace for credit default swaps, one of the most important, controversial and opaque securities traded on the Wall Street, CNBC has learned.

The meeting, scheduled to be held as early as Tuesday of this week at the headquarters of the New York Fed, is expected to clear the way for the creation of a new clearing house, or exchange, where CDSs can be traded with more transparency and with a degree of government oversight.

At the moment CDSs are traded in the over-the-counter market, where traders buy and sell the securities among themselves.

http://www.cnbc.com/id/27044623

[ozymandius]

21. Fed reportedly looking into unsecured lending (Yes, they're nuts.)

LONDON (MarketWatch) -- The U.S. Federal Reserve is reportedly looking at getting into unsecured lending, an extreme step that could allow it to directly purchase commercial paper, according to a report in the Financial Times. The report said the Fed had never done so in its history, but doing so could allow it to participate in the frozen inter-bank money market and the contracting commercial paper market.

http://www.marketwatch.com/news/story/fed-reportedly-looking-unsecured-lending/story.aspx?guid={FE856AB9-B78B-485B-9209-676B8E898EBB}&dist=msr_1

[Demeter]

23. At Least This Money Would Benefit US

That's got to be an improvement.

Good morning, Ozy! Still hanging in there, keep the faith.

[ozymandius]

25. Good morning Demeter.

:donut: :donut: :donut:

The Fed's involvement at this stage is premature in my opinion. By jumping to this drastic measure would put the Fed in direct competition with the banks the Fed is trying to save. Some institutions deserve to fail. But healthy ones do not. The inability to rollover debt can kill off healthy companies. So I understand why the Fed would announce this plan

It could goose the lending system to work as it is supposed to work. It's a massive gamble for sure.

[Ghost Dog]

28. Whatever's done has to be done damn' soon, I reckon.

See the graphic description of the liquidity freeze here (and shudder): http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4183364

[ozymandius]

36. That's a stunning graphic. It's indicative of a number of things.

First, they are hoarding cash. One somewhat benign reason: U.S. banks make money from the Fed on their capitalization levels. See this press release from the Fed:

The Federal Reserve Board on Monday announced that it will begin to pay interest on depository institutions' required and excess reserve balances. The payment of interest on excess reserve balances will give the Federal Reserve greater scope to use its lending programs to address conditions in credit markets while also maintaining the federal funds rate close to the target established by the Federal Open Market Committee.

Secondly, this is preparation for an even greater crisis. Imagine what can happen if the Fed's program to buy unsecured paper does not work.

Third, this is symptomatic for the crisis already at full bore.

Banks are scrambling for whatever capital they can get. When AIG collapsed banks lost a safety net that had seemed as secure as T-notes. Now T-notes are losing their value as investment money seeks shelter in its most secure form.

[54anickel]

51. Whoa! That looks nasty. At first glance, I thought it depicted exponential growth.

Check out the linked Fed report http://www.federalreserve.gov/releases/h41/Current/

Some interesting additions beteen Sept 24 and Oct 1 that didn't exist a year ago.....or an I reading those thing with zero in the 2 center columns wrong?

[Warpy]

119. More like looking at their balance sheets

and realizing just how much of it is bad paper generated by hedge funds.

[nadinbrzezinski]

108. Massive is to put it mildly

listening to the hearing ... and this is philosophical as well

[ozymandius]

22. EBay Trims Its Work Force and Makes Acquisitions (1,000 jobs gone)

SAN FRANCISCO — The Internet company eBay is both tightening its belt and expanding its reach in preparation for the coming economic storm.

On Monday, eBay announced it would lay off 10 percent of its 16,000 workers, including 1,000 permanent employees, and pay $1.35 billion to acquire the Web payment firm Bill Me Later and the Danish classified advertising companies Den Bla Avis and BilBasen.

EBay, based in San Jose, Calif., said most of the layoffs would be in its core marketplace division, which has suffered from declining single-digit growth rates while online commerce has been growing at a double-digit clip.

....

EBay is paying $920 million in cash and options for Bill Me Later, an eight-year-old firm based in Timonium, Md. The company takes a different approach to online payments. It allows people to buy items on the Internet and then sends them a bill within 30 days, at which point they can either pay the bill outright or take out a loan.

http://www.nytimes.com/2008/10/07/technology/07ebay.html?bl&ex=1223524800&en=6b2e328b1376df03&ei=5087%0A

[Demeter]

26. Meet The $700 Billion Bailout Czar By Rob Kall

http://www.opednews.com/articles/Meet-The-Czar-Managing-the-by-Rob-Kall-081006-665.html



There is a new Czar in America""the man who will be running the $700 billion budget bailout/rescue program-- assistant secretary of the Treasury for International Affairs-- Neel Kashkari.

Henry Paulson tapped the company he ran, Goldman Sachs, to hire 35 year old Kashkari, who started as a senior advisor. George W. Bush nominated him as assistant secretary of the Treasury for International Affairs. The appointment was evaluated by the senate banking committee in early June 2008 and approved by the senate on June 27., 2008.

The Wall Street Journal reports that Khashkari's position as czar of the $700 bailout is "interim, pending Senate confirmation. It isn't likely the Senate will move on the matter before the November elections. Mr. Kashkari isn't expected to remain in the post after January, when the Bush administration comes to an end, and,



"Mr. Kashkari was part of the Treasury team that negotiated the asset-repurchase program with Congress, putting in marathon sessions along with Robert Hoyt, Treasury's general counsel, and Kevin Fromer, the head of legislative affairs. He was also one of the originators of the plan. Last year, he and Phillip Swagel, assistant secretary for economic policy, crafted a proposal called "break the glass" -- referring to the emergency nature of using such a tool -- which envisioned Treasury buying bad loans and other assets.

Treasury is trying to get the program running as quickly as possible. It is expected to begin soliciting bids from asset managers this week and could hire several managers before the week is over, according to people familiar with the matter. The department plans to hire managers with expertise in the types of securities the government likely will buy, in particular mortgage-backed securities and residential mortgages.

On the US Treasury site, the following profile is provided, which, it seems, has provided the bulk of material several dozen other articles have used to cover who Kashkari is:

Neel Kashkari
Senior Advisor

Neel Kashkari is Senior Advisor to U.S. Treasury Secretary Henry M. Paulson, Jr. He provides counsel to the Secretary on key policy matters.


Prior to joining the Treasury Department, Mr. Kashkari was a Vice President at Goldman, Sachs & Co. in San Francisco, where he led Goldman's IT Security Investment Banking practice, advising public and private companies on mergers and acquisitions and financial transactions. Prior to his career in finance, Mr. Kashkari was a R&D Principal Investigator at TRW in Redondo Beach, California where he developed technology for NASA space science missions such as the James Webb Space Telescope.


Originally from Stow, Ohio, Mr. Kashkari graduated from the University of Illinois at Urbana-Champaign with a Bachelor's and Master's degree in Engineering. He also received an M.B.A. in Finance from the Wharton School. Mr. Kashkari and his wife Minal maintain residences in Maryland and California.


There's not much to be found about Mr. Kashkari beyond the Treasury's brief two paragraph description. Calls to the senate banking committee and the treasury yielded almost no new information, just promises of callbacks from press people who were not available. One spokesperson did say that the announcement of Kashkari's appointment had just occurred today. While not confirming that the senate banking committee did not know who would be doing this job, with its huge responsibilities, the indication that the announcement had occurred today was in response to a question as to whether the committee had known BEFORE approving the bill, who would be managing the bailout.



Here's a link to a Cspan video, where he talks about a new kind of mortgage for the US. He comes off as a bright, techo-geek economist kind of man""smart, articulate, knowledgeable. But he is introduced as being strictly a speaker on "covered mortgages"- and the audience is instructed not to ask him questions on other topics.
In June 2007, he spoke on the Bush energy policy, and it was reported "he sidestepped most of the prickly issues."-

The Washington Post reports that Kashkari is a former vice president at Goldman Sachs, where he led the firm's security investment banking practice. Apparently, Kashkari was still a student at Wharton in February, 2002, when the Philadelphia Inquirer reported on his participation in a leadership class exercise. That would put him at no more than six years out of school.

In 2006, Neel Tushar Kashkari of Stow Ohio was reported to be selected as one of the regional finalists for the White House Fellows Program. A final listing of the actual recipients for 2006-2007 does not include Kashkari.


Kashkari is a 1991 graduate of Western Reserve Academy, a private college prep boarding and day school.

Update:

Neel Kashkari is the number 1 search target on google trends at the time of this update, 3:59 PM EST





Authors Bio:
Rob Kall is executive editor and publisher of OpEdNews.com, President of Futurehealth, Inc, inventor . He is also published regularly on the Huffingtonpost.com. He is a frequent Speaker on Politics, Impeachment, The art, science and power of story, heroes and the hero's journey, Positive Psychology, Stress, Biofeedback and a wide range of subjects. He is a campaign consultant specializing in tapping the power of stories for issue positioning, stump speeches and debates. He recently retired as organizer of several conferences, including StoryCon, the Summit Meeting on the Art, Science and Application of Story and The Winter Brain Meeting on neurofeedback, biofeedback, Optimal Functioning and Positive Psychology. See more of his articles here and, older ones, here.

[TalkingDog]

33. Don't you find it ironic that his name is (has been) pronounced Cash/Carry?

Almost spit on my steering wheel yesterday when they announced his appointment.

[ozymandius]

37. I imagine he has a briefcase imprinted with the word 'SWAG'. nt

[54anickel]

75. I'm looking for the toon from the other day with the taxpayer in the glass case. Break the glass

indeed.

[ozymandius]

27. Zoellick: Break Up the Group of Seven

World Bank President Robert Zoellick said on Monday, Oct. 6, that the global financial crisis is getting "a wake-up call," indicating that the world's financial system needs a fundamental shakeup. For starters, he says, Western industrial powers should disband their clubby Group of Seven, and embrace a more flexible, broader-based group of nations reflecting today's more dispersed financial realities.

Zoellick explicitly aimed his punchy remarks at the next U.S. President as global markets succumbed to the same crisis of confidence that has pummeled the U.S. economy. He also may be aiming for a broader audience—finance ministers of the G7 countries are to meet Friday, Oct. 10, one day before the annual meeting of the World Bank and the International Monetary Fund in Washington.

.....

Zoellick said that the crisis is multilayered, involving diplomatic discord over trade, climate change, and energy and agricultural prices. Against those challenges, Zoellick urged "a new multilateral network," or what he called a "steering group" of some 14 or more countries that dominate the world population, economy, carbon emissions, capital markets, and foreign assistance. He said that in addition to the G7 countries, candidates for membership might include Brazil, China, India, Mexico, Russia, Saudi Arabia, and South Africa. The G7 countries are Britain, Canada, France, Germany, Italy, Japan, and the U.S.

http://www.businessweek.com/bwdaily/dnflash/content/oct2008/db2008106_029088.htm

[54anickel]

77. This scares me. Did Zoellick get religion or something? He's starting to sound like a real

bleeding heart liberal.

I don't trust that bastard any further than I can toss him. He was a PNACer, part of Condi's Vulcan circle of friends, a free-trader pushing for CAFTA. A freaking hypocrit....

http://www.opendemocracy.net/globalization-trade_economy_justice/article_860.jsp

Trade hypocrisy: the problem with Robert Zoellick

Robert Zoellick, the US Trade Representative, is a man with a mission backed by a sense of history. Writing in the 7 - 13 December edition of The Economist, he sketched the battle plan for an American crusade to promote global free trade, tracing the roots of the Bush administration’s policies back to the protestors who dumped English tea in Boston harbour.

The analogy was apt – but inadvertently so. After all, the dumping of agricultural produce is one area in which the United States retains a powerful comparative advantage, spending billions of dollars each year disposing of American farm surpluses in developing countries. Another area of trade policy in which the Bush administration exercises global leadership, superbly captured by the Zoellick manifesto, can be summarised in a single word, ‘hypocrisy’. Like the British colonialists that attracted the ire of the Boston tea party fraternity, the United States is a good old-fashioned mercantilist power, combining protectionism at home with a commitment to free trade overseas.

Of course, there are differences. In the 19th century, Britain opened markets through gunboat diplomacy and occupation. These days the preferred instruments for America’s crusade are the World Trade Organisation (WTO), regional trade pacts and bilateral agreements on open markets.

snip>

Zoellick claims that farm policy is one area in which the Bush administration has started to introduce market-based principles. There are two possible explanations for this view. Either the current US trade representative has a sense of humour to match his sense of history or he has lost touch with reality.

Under the 2002 Farm Security and Rural Investment Act, the administration is committed to spending up to $20bn a year in farm subsidies, an increase of around 10% over the last farm bill. Moreover, the new legislation introduces elements that will be deeply damaging to developing countries. It reinforces the link between subsidies and output, raising the spectre of an expanded surplus to be dumped on world markets. And by shifting the burden of supporting farm incomes away from the market and on to taxpayers, it enables agribusiness exporters such as Cargill and Archer Daniels to get access to produce at prices far below costs of production.

The upshot is relatively straightforward. Smallholder farmers in developing countries – ‘a group that accounts for three-quarters of all people living below the extreme poverty line of less than $1 a day’ – will continue to face grossly unfair competition in local and global markets.

Protectionism in the guise of free trade

For those clinging to the hope that the Doha ‘development round’ will help resolve the problems in world agricultural markets caused by northern government subsidies, here is some simple advice: forget it.

more...

[ozymandius]

118. Probably preparing for his next interview with a populist-minded president. nt

[Karenina]

143. BWHAHAHAHAHAHA!

:spray: :rofl::rofl::rofl: YOU NEED TO WARN A GIRL!!!

[UpInArms]

30. dollar wacth

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

Last trade 81.159 Change -0.434 (-0.56%)

US Dollar Rockets Higher on Demand for Treasuries, Will the FOMC Minutes Trigger a Sell-off?

http://www.dailyfx.com/story/bio1/US_Dollar_Rockets_Higher_on_1223334770871.html

The US dollar continued its extensive rally on Monday, but it had little to do with fundamentals given the plunge in US non-farm payrolls for the ninth consecutive month on Friday. Instead, we’ve seen that the risk aversion pervading the market has led traders to sell assets like stocks for US dollars who then use them to buy US Treasuries in a classic bout of “flight-to-safety.” In fact, as of Friday 30-year Treasuries and EUR/USD held an 82 percent inverse correlation, highlighting the importance of demand for government debt. Meanwhile, the CBOE’s VIX Volatility Index hit a record high of 58.24 today, signaling the fears lingering in the markets. The Federal Reserve has been taking extraordinary measures to try to deal with all of these problems, and this morning they announced that they would start paying interest on depository institutions’ requires and excess reserve balances. With more money on deposit at the Fed, the central bank will have better funding for their liquidity injections. Furthermore, the New York Fed said, “Without authority to pay interest on reserves, from time to time the Desk has been unable to prevent the federal funds rate from falling to very low levels.” As a result, this measure should help to stabilize rates.

Looking ahead to Tuesday, the minutes from the Federal Open Market Committee’s September meeting will be released and this could draw attention once again to the problems plaguing the US economy. It was somewhat surprising to see the markets completely brush off the disappointing non-farm payrolls numbers, as the risks for recession remain very high. However, bearish commentary by the FOMC members may enough to remind traders just how bad things are. Fed fund futures are fully pricing in a 50bp cut on October 29, and if the minutes suggest that the Committee may actually consider cutting rates, the US dollar could pull back sharply. My fundamental bias for the US dollar on Tuesday: bearish. However, I don’t think this bull trend for the greenback should be ignored.

...more...

Pound Sinks On Rumors of UK Banks Seeking Help, Is A Coordinated Rate Cut Ahead?

http://www.dailyfx.com/story/topheadline/Pound_Sinks_On_Rumors_of_1223375341501.html

The Pound dropped over 300 points on the news that U.K. banks maybe seeking help from the government. The GBPUSD would fall as to 1.7319 from 1.7650 before finding support as rumors that the Chancellor Alistair Darling and BoE governor Mervyn King met with the leaders of Royal Bank of Scotland and Barclays and have discussed investing 45 billion pounds. Meanwhile, industrial production fell 0.6% in August, the fourth straight month of declines, as the economy marches toward a recession.

The fall in industrial production demonstrated the impact of the global slowdown as petroleum and metals production fell 0.5% and 0.6% respectively. However, the news was overshadowed by the speculation that the U.K. government will have to come to the aid of the country’s major banks which is perpetuating the fears generated by the credit crisis. The banks are anticipated to need to pay 54 billion pounds by March 2009, which it may not be able to meet without government funding. The BoE is expected to cut rates by 25 bps at Thursday policy meeting which will continue to weigh in the pound. Indeed, credit overnight index swaps are pricing in a 165 bps worth of cuts over the next 12 months. Therefore, a 50 point rate cut is not out of the question considering current market conditions. .

Markets have been calling for a coordinated rate cut from the major central banks. Although, we may not see a simultaneous effort, global policy makers may follow the RBA’s lead, which surprised with a 100 point reduction last night. The central bank brought their benchmark rate to 6.00%, which is the lowest since November 2006. Focused has turned to the ECB and if President Trichet will finally abandon his focus on price stability and lower rates. The MPC leader stated yesterday that the central bank is ready to provide liquidity as long as necessary. This follows his testimony that policy makers considered a rate cut at their last rate decision. Credit Suisse overnight index swaps are pricing in 129 bps worth of cuts over the next twelve months, signaling that easing from the ECB may happen at anytime. The Euro traded choppy throughout the overnight session as the decreasing interest rate expectations were offset by a rebound in German factory orders which rose 3.6% in August against expectations of a 0.5% improvement.

Speculation is that the Fed will take measures to backstop the commercial paper market as their latest effort to lubricate credit markets. The market has tried up making it difficult for companies to finance their businesses. The $700 billion bailout plan has become old news before the plan has begun to be implemented as panic continues to grip markets. The current crisis is being called the Great Depression 2 and the sharp drop in stocks yesterday underlined the fear in the markets. Therefore, many expect Fed Chairman Bernanke to cut rates by as much as 50 bps in order to bring down credit costs. Fed funds futures are pricing in a 44% chance of a 50 point cut at the central bank’s October 29 meeting. Expectations that the MPC may act before the scheduled meeting may start to weigh on the dollar. However, as long as traders seek the safety of U.S. treasuries we will see the greenback’s strength continue. The FOMC meeting will be released today from their last meeting, which is traditionally significant event risk for the dollar. However, giving the historic events since then it may be a non-event.

...more...

[Ghost Dog]

78. U.S. dollar, yen fall as risk appetite returns

Tue Oct 7, 2008 10:27am EDT

* USD falls against basket of currencies, yen also slips

* Federal Reserve creates commercial paper-buying facility

* Fed Chairman Bernanke to speak on Tuesday

NEW YORK, Oct 7 (Reuters) - The U.S. dollar and the yen fell after the Federal Reserve on Tuesday acted to prop up the commercial paper market, boosting risk appetite.

...

The Fed said it set up a special-purpose facility with the Treasury Department's blessing to buy commercial paper in yet another emergency move aimed at calming chaotic financial markets. For more see .

"It looks like they've decided to step in and relieve the pressure there. It's risky asset positive, so stocks like it and the yen crosses like it," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey.

In early trading in New York, the euro <EUR=> was up 1.4 percent to $1.3682, rebounding from a low of around $1.3444 hit on Monday, according to Reuters data, sparked by escalating worries about the health of European banks.

The ICE Futures U.S. dollar index, which tracks the greenback against a basket of six currencies, fell 1.1 percent to 80.766 .DXY.

Against the yen, the dollar rose 0.5 percent to 102.30 yen <JPY=>.

"The Fed announcement to act as a backstop in the CP market is likely to have a positive reaction in regard to sentiment," said Dustin Reid, senior currency strategist at RBS Greenwich Capital in Chicago.

"In terms of FX, it should help risk appetite on the margin, which is likely why we are seeing a USD selloff here."

The Fed move lessened the need for big cuts to benchmark lending rates, prompting a selloff in U.S. interest rate futures. This erased implied prospects for a possible 75 basis-point cut by the Fed in benchmark overnight U.S. interest rates at its next monetary policy meeting this month, and pushed chances for a 50 basis-point cut as low as 86 percent.

/... http://www.reuters.com/article/marketsNews/idINN0745309920081007?rpc=44&sp=true

[Lydia Leftcoast]

88. The dollar is actually up slightly since yesterday

I think investors looked over the edge of that $1/¥100 threshold, got nervous, and pulled back.

[Festivito]

31. Debt: 10/03/2008 10,186,269,007,199.11 (UP 37,519,723,114.96) (700B$ starts?)

(Third day in FY2009. Does this start the 700B$ borrowing, has it begun already, or is it still waiting to begin. I do not know.)

= Held by the Public + Intragovernmental(FICA)
5,913,838,136,448.68 + 4,272,430,870,750.43
(Public, I think now includes China and Brazil et. al.)

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

HISTORICAL:
President's term ends/begins: Jan 20
01/20/1993 4,188,092,107,183.60 BC Inaugural
01/22/2001 5,728,195,796,181.57 BC (UP 1,540,103,688,997.97)
10/02/2008 10,186,269,007,199.11 ** (UP 4,458,073,211,017.54 so far since Bush took office)

Fiscal Year ends: Sep 30
(Guess who might want to hide the Reagan Bush years.)
Borrowed in FY1993: (OLDER DATA IS MISSING)
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: 161,544,110,286.62 so far, three days.

UpInArms, the brillig clock fails to work since 10/03/2008!
http://www.brillig.com/debt_clock

53,848,036,762.21 Last three days average.
_4,520,317,887.33 FY2008 average(225).
_2,225,242,102.43 FY2007 average(225).
__,_79,588,036.68 FY2000 BC only average(225).
(And that was Bill Clinton doing more, with less borrowing, including a tech bubble burst, including a pre-election readjustment, all his, and the numbers were better even after that 2000-September: 4th quarter ended.)
56,884,049,338.70 Last seven business days average since double digit billions amounts began happening each day.

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.)
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3528839&mesg_id=3528853

[ozymandius]

42. It seems reasonable to watch the Social Security surplus balance.

Just a random thought: As the $700 billion is dispersed, I somehow expect the SS surplus to be a plum target for resources.

[Festivito]

68. Consider: every bit of public debt inhibits ability to pay SS back.

SS only increases what it is owed as the nation works and pays FICA.

The public debt increases depending on how brilliant or how stupid our policies are.

[antigop]

73. And Medicare -- which is in even worse shape. n/t

[Festivito]

103. Exactly. /nt

[DemReadingDU]

52. 161,544,110,286.62 so far, three days.

Where is all this money going? What is it being used for?

This is insane.

[Festivito]

258. Debt: 10/06/2008 10,187,754,347,408.87 (UP 1,485,340,209.70) (Mon

(Fourth day in FY2009. Suddenly less than a Bush average Still way above a Bill Clinton average.)

= Held by the Public + Intragovernmental(FICA)
5,913,434,272,451.45 + 4,274,320,074,957.42
DOWN 403,863,997.23 + UP 1,889,204,206.99
(FICA changes mostly around each end of month. Makes sense, that's when checks go out.)

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

HISTORICAL:
President's term ends/begins: Jan 20
01/20/1993 4,188,092,107,183.60 BC Inaugural
01/22/2001 5,728,195,796,181.57 BC (UP 1,540,103,688,997.97)
10/02/2008 10,187,754,347,408.80 ** (UP 4,459,558,551,227.24 so far since Bush took office)

Fiscal Year ends: Sep 30
(Guess who might want to hide the Reagan Bush years.)
Borrowed in FY1993: (OLDER DATA IS MISSING)
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: 163,029,450,496.32 so far, four days.

UpInArms, the brillig clock fails to work since 10/03/2008!
http://www.brillig.com/debt_clock

(250 seems an average number of borrowing days for the debt to the penny data.)
Average work-day debt increase using 250 work-days for each year instead of 225:
FY1994: 1,125,044,107.50
FY1995: 1,124,931,962.78
FY1996: 1,003,312,153.71
FY1997: _,753,340,289.05
FY1998: _,452,187,990.00
FY1999: _,520,311,570.94
FY2000: _,_71,629,233.01
FY2001: _,533,140,809.25
FY2002: 1,683,090,213.59
FY2003: 2,219,980,388.59
FY2004: 2,383,286,534.35
FY2005: 2,214,627,861.57
FY2006: 2,297,056,949.97
FY2007: 2,002,717,892.19
FY2008: 4,068,286,098.60 That's as good as one should make Bush look, not good at all.
(I don't want to repeat the daily so far for four days. It's high. It's ugly. It changes fast. It went down for today. I want to be happy about that. It's just not worth calculating today.)

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.)

[muriel_volestrangler]

32. Iceland government seizes control of Landsbanki

The Icelandic government this morning seized control of Landsbanki, the second-largest bank in the country, as it sought to avert a financial meltdown.

The government moved quickly to use sweeping powers over the country's banks granted in the Reykjavik parliament last night. The board of directors at Landsbanki has been dismissed and the bank put into receivership.
...
In an address broadcast on Icelandic television last night, prime minister Geir Haarde announced plans to rush through the emergency bill, supported by opposition parties, allowing the government to push through mergers between the battered banks or force them into bankruptcy.
"We were faced with the real possibility that the national economy would be sucked into the global banking swell and end in national bankruptcy," he said.

The Icelandic Financial Services Authority said it had taken control of Landsbanki to "guarantee a functioning domestic banking system".

http://www.guardian.co.uk/business/2008/oct/07/iceland.banking

[Ghost Dog]

34. European stocks up around midday; RBS plummets

Tue Oct 7, 2008 8:22am EDT PARIS, Oct 7 (Reuters) - European stocks were higher on Tuesday after suffering record losses in the previous session, but banks fell again as the credit crisis escalated, prompting Iceland to take control of Landsbanki (LAIS.IC: Quote, Profile, Research, Stock Buzz).

Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) plummeted 26 percent, Lloyds (LLOY.L: Quote, Profile, Research, Stock Buzz) shed 6.7 percent and HBOS (HBOS.L: Quote, Profile, Research, Stock Buzz) tumbled 14 percent, hit by talk that the British government was mulling a possible bank recapitalisation plan with the country's lenders. RBS said it did not make a request to government for capital.

An industry source told Reuters Britain and its banks will hold more urgent talks over a possible multi-billion pound injection into the sector over coming days.

At 1200 GMT, the FTSEurofirst 300 index of top European shares was up 1.3 percent at 1,018.03 points. Stocks experienced their worst one-day percentage fall on record on Monday, tumbling to four-year closing lows as mounting fears over the global credit crisis prompted investors to dump stocks across the board.

"Shares of big banks are collapsing. It's just a complete loss of confidence, worries about what governments are going to do and what governments can do," said Alan Harris, investment manager at Charles Stanley.

"Europe is supposed to be acting with one voice but it seems to be chaotic at the moment," he said.

"You must not panic, that's the worst thing to do. You do not sell good quality shares at these prices ... This could be sort of a climactic selloff that very often leads to the bottom of the market, and we've been in a bear market for 15 months now, which is a reasonable length of time."

Deutsche Bank (DBKGn.DE: Quote, Profile, Research, Stock Buzz) dropped 7.4 percent on talk the German lender may be looking to push through a capital increase.

A spokesman for the bank declined to comment.

French banks were on the rise, with BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz) up 2.6 percent and Credit Agricole (CAGR.PA: Quote, Profile, Research, Stock Buzz) up 1.6 percent, gaining ground after French President Nicolas Sarkozy said France was prepared to help French banks by acquiring a stake in their capital if necessary.

/... http://www.reuters.com/article/marketsNews/idCAL79570320081007?rpc=44&sp=true

This after earlier greater uncertainty:

European shares rebound; banks, energy, miners lead
Tue Oct 7, 2008 3:19am EDT FRANKFURT, Oct 7 (Reuters) - European shares rose in early trade on Tuesday, recovering from the previous session's steep losses, with banks in the lead after an Australian central bank rate cut raised hopes of monetary policy easing elsewhere.

Heavyweight energy stocks also contributed to the rebound, drawing cheer from a rise in the crude oil price to above $90 a barrel, and mining stocks advanced on the back of higher metals prices.

At 0716 GMT, the FTSEurofirst 300 index of top European shares was up 2.6 percent at 1,031.25 points. It fell 7.8 percent to a four-year-low close on

/... http://www.reuters.com/article/marketsNews/idCAL736300320081007?rpc=44

European shares fall 1 pct as bank woes grow
Tue Oct 7, 2008 4:32am EDT FRANKFURT, Oct 7 (Reuters) - European shares turned sharply negative early on Tuesday, having risen more than 2.5 percent in initial trading, as banks took a beating amid reports of additional funding needs.

At 0831 GMT, the FTSEurofirst 300 index of top European shares was down 1.2 percent at 993.09 points, having risen as much as 2.6 percent.

Banks were the top weighted losers on the index, with Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) down 33 percent on speculation that it was in talks for UK government funding, and Deutsche Bank (DBKGn.DE: Quote, Profile, Research, Stock Buzz) down 14 percent on talk of a capital increase, though a financial source dismissed the speculation.

/.. http://www.reuters.com/article/marketsNews/idCAL71200320081007?rpc=44

[Ghost Dog]

45. Europe stocks rise after Fed CP funding facilitiy

Tue Oct 7, 2008 9:18am EDT LONDON, Oct 7 (Reuters) - European shares extended gains on Tuesday after the U.S. Federal Reserve announced the creation of a special-purpose facility to begin buying commercial paper in yet another emergency move aimed at calming financial markets.

By 1314 GMT, the FTSEurofirst 300 of top European companies was up 2 percent at 1,025.02 points, after trading at 1,006.99 before the announcement.

Oil and gas were the top performing sector on the index, with BP (BP.L: Quote, Profile, Research, Stock Buzz) up 5 percent and Total (TOTF.PA: Quote, Profile, Research, Stock Buzz) rising 5.4 percent.

UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) gained 1.8 percent, Santander (SAN.MC: Quote, Profile, Research, Stock Buzz) advanced 4.3 percent and BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz) climbed 5 percent. But Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) slumped nearly 22 percent and HBOS (HBOS.L: Quote, Profile, Research, Stock Buzz) shed 14.6 percent.

/. http://www.reuters.com/article/marketsNews/idINL722069320081007?rpc=44

[ozymandius]

38. Wall Street looks to recover after global rout (What's wrong with this picture?)

NEW YORK (AP) -- Wall Street looked to recover Tuesday from a huge sell-off the previous session, with investors hopeful that central banks around the world will cut interest rates to help alleviate turmoil in the credit markets.

Australia's central bank cut interest rates by the largest amount since 1992 in a surprise move, and that reignited hopes that others including the Federal Reserve and European Central Bank might follow. The move helped Asian markets, and later European bourses, rebound from a global rout in stocks on Monday.

Investors sent U.S. stock futures higher, but that's still not a sign that the intense volatility seen in the market in the past few weeks will subside. Dow Jones industrial average futures added 33, or 0.29 percent, to 9,997. Standard & Poor's 500 index futures rose 10.00, or 0.95 percent, to 1,063.30, while Nasdaq 100 futures rose 20.00, or 1.42 percent, to 1,426.50.

http://biz.yahoo.com/ap/081007/wall_street.html

---

The Fed eases lending rates. Banks borrow from the Fed. Then what? Banks are hoarding cash. The cash-on-hand balances are skyrocketing. So what good is a lower interest rate when the money does not move elsewhere though the system?

[Ghost Dog]

43. Bank of Canada opts out of coordinated US$ actions

Tue Oct 7, 2008 8:29am EDT TORONTO, Oct 7 (Reuters) - The Bank of Canada said on Tuesday it will not participate in coordinated central bank actions aimed at increasing U.S. dollar liquidity.

The central bank said it welcomes central bank initiatives to provide U.S. dollar liquidity but felt it was not necessary for it to participate in the auctions at this time.

/.. http://www.reuters.com/article/marketsNews/idCATOR00354020081007?rpc=44

[UpInArms]

44. 'cause the Fed is going to pay interest on their reserves? eom

:hi:

[ozymandius]

50. This has been another edition of "Simple Answers to Simple Questions."

And *snap* UIA!

This makes me think of Rad's cartoon posted up-thread.

I just cannot get into the minds of those who frantically believe that an interest rate cut will somehow boost the fortunes of their favorite widget maker.

:hi:

[54anickel]

81. Would that be related to the definition of insanity? Cuz I can't believe they've gone

stupid.:shrug:
It's like a game of double-dare you or someone holding a gun to the CBs heads. Is there some revolt going on in the upper layers of the Kleptocracy? :tinfoilhat:

[Demeter]

105. Nope. Business as Ususal

[ozymandius]

46. pre-open numbers and blather

09:02 am : S&P futures vs fair value: +7.90. Nasdaq futures vs fair value: flat. Futures rebound on news that the Federal Reserve created a commercial paper funding facility, where it will buy three-month commercial paper. It is meant to provide a liquidity backstop, as the commercial paper market has been strained.

09:16 am : S&P futures vs fair value: +13.60. Nasdaq futures vs fair value: +13.30. Nasdaq and S&P 500 Index futures climb to session highs on the news that the Fed created a Commercial Paper Funding Facility. Crude prices continue to rally, now up 5.2% to $92.32 per barrel.

[antigop]

47. Sovereign funds investing big in U.S. companies -- but the government doesn't know where

GAO report found that while several agencies track fund holdings, they don’t know exactly where the money is going
http://financialweek.com/apps/pbcs.dll/article?AID=/20081006/REG/810069973/1036

Sovereign wealth funds have invested a good chunk of their assets in U.S. companies, spending more than $43 billion from January 2007 through June 2008. But many of those investments are not disclosed and indeed are only loosely tracked by U.S. agencies, according to a study published today by the Government Accountability Office.

Of the 48 funds analyzed by GAO, including heavies such as the Abu Dhabi Investment Authority and the China Investment Corporation, just 60% publicly disclosed the amount of their assets under management, and only four funds gave out detailed data on all their investments.

GAO’s results discounted funds that acted like pension funds—those that received funds from or made benefit payments to employees. Still, it may be one of the best snapshots of how and where sovereign wealth funds invest.

According to the analysis, sovereign funds manage from $2.7 trillion to $3.2 trillion. By far the largest fund is Abu Dhabi’s, which is estimated to manage anywhere from $625 billion to $875 billion. The next largest, Norway’s pension fund, manages $372 billion.

[ozymandius]

53. Peeling tires at 9:45

Dow 10,097.35 Up 141.85 (1.42%)
Nasdaq 1,875.66 Up 12.70 (0.68%)
S&P 500 1,069.63 Up 12.74 (1.21%)
10-Yr Bond 3.573% Up 0.147
NYSE Volume 469,921,156.25
Nasdaq Volume 171,138,765.625

09:35 am : The stock market gets off to a positive start, lifted by news that the Fed is taking action to address liquidity issues in the corporate short-term borrowing market. Still, early gains do not come close to making up Monday's plummet of nearly 4%.

The Fed created a Commercial Paper Funding Facility (CPFF), which will provide a liquidity backstop for the strained commercial paper market. The Fed will purchase three-month unsecured and asset-backed commercial paper from eligible issuers. The Fed did not give a dollar amount on size of the CPFF. The commercial paper market, which banks and U.S. corporations rely on for short-term borrowing, has been under pressure as investors flocked to the safety of Treasuries and away from money market funds.

As stocks advance, Treasuries decline as news of the CPFF encourages investors to take risks. The 10-year note is down 28 ticks, sending its yield up to 3.56%. The 3-month bill yield climbed 26 basis points to 0.75%.DJ30 +79.17 NASDAQ +19.66 SP500 +8.18

[radfringe]

60. slamming on the brakes at 9:58 am?

Dow 9,978.92 +23.42 (0.24%)
Nasdaq 1,854.71 -8.25 (-0.44%)
S&P 500 1,056.65 -0.24 (-0.02%)

[Roland99]

62. jinx!

:toast:

[Roland99]

61. 9:58am - And then screeching to a halt.

Dow 9,974.62 +19.12
Nasdaq 1,853.91 -9.05
S&P 500 1,057.00 +0.11
10-year 3.52% 0.10
Oil $87.81 -$6.07
Gold $884.00 $17.80

[Roland99]

67. 10:07am - Put it in Reverse!!!

Dow 9,895.37 -60.13
Nasdaq 1,844.96 -18.00
S&P 500 1,049.50 -7.39
10-year 3.51% +0.08
Oil $87.81 -$6.07
Gold $887.50 $21.30

[Dr.Phool]

65. AmEx rates credit risk by where you live, shop

By Mike Stuckey
Senior news editor
MSNBC
updated 6:42 a.m. ET, Tues., Oct. 7, 2008

Credit-card firm confirms members' mortgage lenders also may be a factor


Mike Stuckey
Senior news editor
• Profile
As the global credit crunch reaches from Wall Street to Main Street, guilt by association has become a tool for evaluating the creditworthiness of American Express customers.

Among other criteria, cardholders are seeing limits reduced because of where they live, where they shop and who holds their mortgage.

“Absolutely unbelievable!” said Jesse Gilleland of suburban Washington, D.C., who says revisions of his American Express accounts and credit limits, at least partly for those reasons, could force him to close his once-thriving computer-consulting firm.

http://www.msnbc.msn.com/id/27055285/
_____________________________________________________________

I'd like to see AMEX evaluate themselves out of business. They charge the highest fees. And they want you to jump through a hundred hoops, just to be able to take American Express.

Like we said at my pizza joint.
"Leave it at home, because we don't take it anyway".

[Zenlitened]

66. Vanguard money market funds to participate in Treasury Guarantee Program

From the Vanguard website:

Vanguard's money market funds will apply for the U.S. Treasury Department's program to support the account values of money market mutual funds. Trustees of the funds decided to participate in the program because they believe it is a helpful step toward stabilizing the credit markets in general, which should benefit investors in all money market funds.

Link:
https://personal.vanguard.com/us/news?article=/freshness/News_and_Views/news_ALL_mmtreasguaruntee_10072008_ALL.jsp

[DemReadingDU]

127. Vanguard: All of our money market funds have applied for coverage.

All of our money market funds have applied for coverage. They're listed below.
Fund Name Fund Number Ticker Symbol
Admiral Treasury Money Market 0011 VUSXX
Federal Money Market 0033 VMFXX
Prime Money Market (Institutional and Investor Shares) 0030 VMMXX
CA Tax-Exempt Money Market 0062 VCTXX
NJ Tax-Exempt Money Market 0095 VNJXX
NY Tax-Exempt Money Market 0163 VYFXX
OH Tax-Exempt Money Market 0096 VOHXX
PA Tax-Exempt Money Market 0063 VPTXX
Tax-Exempt Money Market 0045 VMSXX
Treasury Money Market 0050 VMPXX
Vanguard Variable Insurance Fund–Money Market Portfolio 0064

—
The temporary program provides coverage to shareholders for amounts that they held in participating money market mutual funds as of the close of business on September 19. In addition, if an investor redeems shares of a participating fund after September 19, the coverage extends only to the balance in the fund on the date it "breaks the buck." In other words, you are covered for the lesser of two amounts: the balance in the fund account as of September 19 or the balance in the fund on the day the fund failed to maintain its stable $1 per share price.

It is also important to point out that subsequent share purchases of participating funds are not covered, nor are purchases into a fund made by new investors. Thus, coverage is grandfathered for balances in money market funds as of September 19 but does not cover any new money invested in a fund.

https://personal.vanguard.com/us/VanguardViewsArticlePublic?ArticleJSP=/freshness/News_and_Views/news_ALL_mmtreasguaruntee_10072008_ALL.jsp&src=NMC&returnLink=/freshness/News_and_Views/news_ALL_mmtreasguaruntee_10072008_ALL.jsp


If I had known this months ago, I would have left my money in the Prime Money Market Fund. But it had exposure to commercial paper, so I moved it to the Treasury Money Market Fund.

Oh well, I missed out on a bit of interest.

[ozymandius]

244. Not surprising. I used to own pieces of Vanguard funds.

Awful things. Being part of the Vanguard family of funds was like being part of an auto racing team that uses cork tires on wooden spoke wheels. They just plain sucked.

[Robbien]

72. Cox's SEC Censored Paper Showing It Ignored Bear Stearns Plunge

Oct. 7 (Bloomberg) -- U.S. Securities and Exchange Commission Chairman Christopher Cox's regulators stood by as shrinking capital ratios and growing subprime holdings led to the collapse of Bear Stearns Cos., according to an unedited version of a study by the agency's inspector general.

The report by Inspector General H. David Kotz was requested by Senator Charles Grassley to examine the role of regulators prior to the firm's collapse in March. Before it was released to the public on Sept. 26, Kotz deleted 136 references, many detailing SEC memos, meetings or comments, at the request of the agency's Division of Trading and Markets that oversees investment banks.

. . .

An unedited version of the 137-page study posted to the Iowa Republican's Web site Sept. 26 showed that Bear Stearns traders used pricing models for mortgage securities that ``rarely mentioned'' default risk.

The firm lost one of its top modelers ``precisely when the subprime crisis was beginning to hit'' and writedowns were being taken, the full report said. ``As a result, mortgage modeling by risk managers floundered for many months,'' according to the unedited document, quoting internal SEC memos from April and December 2007. The comments were removed from the edited version publicly released by the SEC.

Trading and Markets had oversight of holding companies for the five biggest U.S. investment banks via the Consolidated Supervised Entity Program. The division failed to follow up on ``red flags'' raised by New York-based Bear Stearns's increasingly ``significant concentration of market risk'' from mortgage securities, according to the full document.

. . .

A footnote in the uncensored version of the report quotes Bear Stearns Chief Executive Alan Schwartz as saying he hadn't held ``terribly current discussions'' to raise capital for his firm even after the SEC asked in March, two weeks before it failed, about obtaining funds.

While Bear had retained Lazard Ltd. as an adviser, the report quoted Schwartz saying, ```The time it would take to get that done, it wouldn't help.''' The CEO said rumors would cause more damage in the meantime, according to the SEC.

. . .

Bear Stearns was able to ``create capital'' by inflating the value of assets including mortgages, according to the unedited study. Two days before it was rescued, the firm paid out $1.1 billion to ``numerous counterparties to squelch rumors'' it couldn't meet its margin calls, the full report said. The finding didn't appear in the censored version.

The firm ``tended to use the traders' more generous marks for profit and loss purposes,'' it said.

Trading and Markets unit members saw that Bear Stearns traders dominated less-experienced risk managers, the inspector general reported in sections that were excised from the public report.

http://www.bloomberg.com/apps/news?pid=20601109&sid=av2fpp3blAgY&refer=home

Because they lost their person who did risk analysis, Bears decided to stop even doing the analysis. Huh?
The CEO didn't even bother going around trying to find money when it got into trouble, too much effort he said. So instead he bribed people with $1.1B to not badmouth Bears. Again, Huh?

So much is in this report and the SEC not only knew, it censored all relevant parts out.

Anyone surprised?

[Cassius23]

83. 10:50AM- Up, no down, no up, no down..I CAN'T DECIDE!

Oct 7 10:50am Change %Change Level
Dow +21.82 +0.22% 9,977.32

NASDAQ -2.99 -0.16% 1,859.97

S&P +1.33 +0.13% 1,058.22

P.S.-

How do you guys get the formatting for the market updates to look the way it does(with the particular totals, the black or red, etc)?

[Roland99]

86. I'm reminded of this scene from Airplane! .....

Airdude : He's all over the place, 900 feet, up to 1300 feet . . .
what an asshole.

[Cassius23]

87. Aaannnddd...we're down again...

I'm considering just looking in again in the late afternoon and spending the rest of the day looking at buying silver(gold is a bit too pricy).

Roland99, how do you do that formatting for the market posts you make?

Cassius23

[Roland99]

110. I just use the brackets for bold and the font color.

Replace the parentheses below with the square brackets:

(b)positive market data(/b)
(b)(font color="red")negative market data(/font)(/b)

[DemReadingDU]

84. Columbus, Oh - National Century Trial, Monday's updates

10/6/08 Witness: Faked numbers hid risky investments on National Century's books
Monday, October 6, 2008 1:19 PM
By Jodi Andes

Faked numbers hid the way National Century Financial Enterprises actually worked, a former associate vice president for the company testified this morning in the fraud trial of CEO Lance K. Poulsen.

Federal prosecutors called Jessica Bily, their third witness in the trial against Poulsen, to explain the differences between the way the books were supposed to be balanced and the way officials hid high-risk financial transactions. Bily became the company's associate vice president of funding, after starting as a data analyst in 1994.

National Century Financial Enterprises bought debts owed to health care providers and collected them for a fee. The company received financial backing from investors who believed that only debts with a high-likelihood of being repaid would be purchased.

However, prosecutors contend that unbeknownst to investors, National Century's payments to health care providers weren't always backed with debts the company could collect.

Bily said some company officials began giving health care providers loans without there being debts to collect upon. She said their term for that was "regular receivables."

To make the company's books balance, Biley said, National Century employees had to use false or "plugged" numbers.

Earlier in the morning, Pete Anderson, a defense attorney for Poulsen, questioned Jon Beacham, National Century's former director of securitizations, to show that Poulsen was concerned about the company being in compliance.

Anderson contended that advancing money to health care providers without taking over collection of debts owed to them - a practice he called "over-advancing" - helped National Century's investors.

"If health care providers go under, that puts note holders in a worse position?" Anderson asked Beacham, who agreed. "The reserves that he took, he didn't pocket it himself he used the money to help the health care providers."

Department of Justice Trial Attorney Kathleen McGovern was to continue her questioning of Bily when court resumes at 1:15 p.m.

The case is being tried in U.S. District Court in Columbus in front of Judge Algenon L. Marbley.
http://www.columbusdispatch.com/live/content/local_news/stories/2008/10/06/natcen07.html?sid=101


10/6/08 Witness: Alleged fraud at National Century stretched back to ’94
Monday, October 6, 2008 - 1:58 PM EDT
by Kevin Kemper
Earlier testimony
Earlier in the morning, both the prosecution and defense finished questioning Jon Beacham, National Century’s former director of securitization.

In testimony last week, Beacham told the jury that he discovered in July 2001 that National Century was advancing cash to health-care providers without buying accounts receivable. That was a violation of the company’s governing documents, and investors were never told that the practice went on, Beacham said.

Under cross-examination Monday morning, Beacham admitted to William Anderson, Poulsen’s attorney, that he never completely told the truth to the government until he signed a plea agreement in 2007. Beacham also acknowledged that when the government indicted him in May 2006, he faced the possibility of serving 30 years or more in prison if found guilty. Because he signed a plea agreement and agreed to cooperate with investigators, Beacham said he now faces 10 years maximum imprisonment, though that time could be reduced further.

“You’re hoping to serve no jail time, is that right?” Anderson asked.

“Of course,” Beacham answered.

Anderson alleged that to have his jail time reduced, Beacham would have to say what the government wanted, a charge Beacham denied.

“I’m here to tell the truth,” he said.
http://www.bizjournals.com/columbus/stories/2008/10/06/daily5.html


10/6/08 National Century exec kept documents detailing alleged fraud
Monday, October 6, 2008 - 5:38 PM EDT
by Kevin Kemper

Bily, who began at National Century after college and rose to become a senior executive, testified that advances approved by Poulsen concerned her so much that she kept her own set of records on the advances at home. She guided the jury through several documents she had created to track the funding. She showed jurors how one company, owned in part by Poulsen and National Century cofounders Donald Ayers and Rebecca Parrett, received more than $7.8 million for operating expenses and more than $7.8 million for its real estate investment trust in the span of less than a week.

Those transactions, Bily said, were not allowed under National Century’s master indenture agreement, a governing document that defined for investors how the company operated.

Bily said she knew of nearly $1 billion that had been illegally advanced to clients by August 2002, six of which were owned by Poulsen.

On cross-examination, William Terpening, Poulsen’s attorney, attempted to draw doubt in jurors’ minds by asking Bily about her education and her contact with Poulsen.

Bily graduated from Wright State University in Dayton in 1994 with degree in English. Until she worked at National Century, she had no training in finance.

Terpening also asked Bily if she had ever read National Century’s governing documents, such as its master indenture agreement, sale and subservicing agreement and private placement memorandum. Bily admitted she had only read a sample sale and subservicing agreement, a document that governed how National Century worked with the health-care providers it financed. When she had questions about other aspects of the business, Bily said she would turn to her superiors for answers.

Bily said she was too intimidated to express her opinions on National Century’s allegedly illegal actions to Poulsen. Instead, Bily said she would relay her concerns to her immediate supervisors.

Terpening also questioned Bily about her cooperation with the government. She admitted that she reached out to help investigators in early 2003, but at the behest of her attorney. Bily also said she went through National Century’s computer network to find documents that would be helpful to the government. On some of those documents, Bily attached explanations of what Poulsen was trying to accomplish.

But Terpening reminded Bily that she and Poulsen didn’t talk together about strategy, and asked why she thought she knew what Poulsen’s intentions were. Bily said she thought it was obvious what Poulsen was trying to do.
http://www.bizjournals.com/columbus/stories/2008/10/06/daily8.html


10/7/08 Exec: Founders kept their wallets full
Tuesday, October 7, 2008 3:12 AM
By Jodi Andes

As National Century struggled financially, its company founders made sure they -- and their interests -- were well taken care of, the company's vice president of funding testified yesterday.

The three founders of National Century Financial Enterprises were given bonuses, even when business loans they approved were unlikely to be repaid, Jessica Bily, former vice president of funding, testified yesterday.

In addition, founders Lance K. Poulsen, Rebecca S. Parrett and Donald H. Ayers authorized sending hundreds of millions of dollars to companies they owned or had stakes in, Bily said.

Bily made the statements in the second week of Poulsen's trial in U.S. District Court in Columbus.

Poulsen is being tried before Judge Algenon L. Marbley on charges of securities fraud, wire fraud, conspiracy and money laundering, acts that prosecutors contend led to the company's demise and to investors losing more than $1.9 billion.

National Century bought debts owed to health-care providers and collected them for a fee. The company received financial backing from investors who were assured that National Century would buy only debts with a high likelihood of being repaid.

When Bily started with the Dublin company in 1994, it juggled money within its program accounts to give the appearance it was keeping cash reserves at appropriate levels.

"Eventually, the problem became so severe, we were moving money" from one program to the next whenever a financial snapshot needed to be taken, she said.

"We were never in compliance with the guidelines on the funding side of things."

In all, Bily said, National Century issued more than $1 billion in loans that were not backed by the income expected from accounts receivable. At first, it didn't include costs for administrative fees on the loans. But Poulsen later insisted that program fees be included, Bily said. It was a noteworthy change, because the founders earned bonuses based in part on the fees, federal prosecutor Kathleen McGovern said.
http://www.columbusdispatch.com/live/content/business/stories/2008/10/07/Natcen07.ART_ART_10-07-08_C7_CNBHHKK.html?sid=101


link backwards to articles Saturday 10/4/08, and older
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=103&topic_id=390159&mesg_id=390311

[Roland99]

85. Thrift stores: We're seeing more middle-class shoppers

Thrift stores: We're seeing more middle-class shoppers
http://www.cnn.com/2008/LIVING/wayoflife/10/06/thrift.shops.ap/index.html

COLUMBIA, Missouri (AP) -- Forget about the outdated notion of thrift shops as the refuge of the working poor, the down and out or the vintage fashion hipster. In these troubled times, the powerful lure of a secondhand retail bargain is attracting a whole new breed of customer.

The Salvation Army and Goodwill Industries International, the nation's two largest charitable resale organizations, report year-to-date sales increases of 6 percent to 15 percent.

The gains are even more pronounced in the private sector. In an industry trade group survey of more than 200 resale and thrift shops, nearly two-thirds of those businesses reported higher sales in 2008 compared to the previous year. The average sales increase: 35 percent.

Consumers "can't change the price of gas. They can't change the price of food. They can't make the stock market go up again," said Adele Meyer, executive director of the National Association of Resale & Thrift Shops. "But they can control the price of clothes and furniture by being a savvy shopper."

[Warpy]

92. I don't go there now

I had to shop there for years. If something broke or wore out and I couldn't fix it, that was my only chance to replace it.

I now leave it for all the people who are now like I was.

I noticed a shift from Wally's to The Dollar Store last year. I'm seeing the thrift store parking lot so full these days that it's hard to take in a carload of donations.

The next shift will be to makeshift markets in city parks, people taking anything they think they can sell to get money for food.

[Roland99]

101. I've been wanting to check some out for some thin-lapel suits

Been wanting to wear some to work after the weather cools.

[Warpy]

117. Too bad you weren't in Florida 2 years ago

One of the things I gave to Aunt Sally's was a bag of 3 piece suits, 1974 cleaner's tags still attached.

I don't know what they thought he was going to do with them. They vetoed funerals in favor of cremation, so that wasn't it.

Depression babies never threw anything out.

[DemReadingDU]

133. Depression babies never threw anything out.

My mom grew up during the depression, she kept everything, and she had 8 kids! I was the oldest. After she passed away, it took us months to sort thru the house.

I think the oddest thing we found was that each of the 8 rooms had a coffee can full of rubber bands.

:shrug:

[Warpy]

161. My dad kept every scrap of paper he had since the late 30s

Some of it was interesting, like his entry papers to Britain to be a civilian engineer with the RAF 2 years before the US got into the war, but most of it was old bank statements and the like. He'd have had to move within the next couple of years because the room he called his office was literally packed with paper.

I had 3 weeks to clean that place out. I hired a dumpster and I filled it.

[TalkingDog]

90. NC based Wachovia has too many suitors

The local chatter is about using the competition to keep jobs and control in Charlotte.

Injunction against the Wells-Fargo/Wachovia deal:
http://afp.google.com/article/ALeqM5gRyUUvULhtA03Wr8zEzQJLX0iOSQ

Another judge strikes down the injunction:
http://afp.google.com/article/ALeqM5gQBrela7z-aHLzt6rpwnGD8O0MSw

http://www.bizjournals.com/philadelphia/stories/2008/09/29/daily46.html

Here we see Wells-Fargo fending off the many suitors of Wachovia.....

[Pale Blue Dot]

91. 11:23 We're suddenly picking up speed (downhill)

The Dow is down 92 pts in the last 10 minutes.

[Ghost Dog]

94. Russia gives banks extra $36 bln to fight crisis

Tue Oct 7, 2008 11:20am EDT

* Medvedev pledges extra $36 billion for Russian banks

* Move fails to rally Russian stocks

* Russia confirms talking about loan to Iceland

* Oil firms seek state funds, tycoon scraps asset split

MOSCOW, Oct 7 (Reuters) - President Dmitry Medvedev announced an extra 950 billion roubles ($36.4 billion) of long-term help for banks at an emergency Kremlin meeting on Tuesday, but failed to rally Russian stocks.

"The whole point of our work is to make decisions as quickly as possible," Medvedev told reporters. "Speed is now priceless."

Russia, which has large foreign exchange reserves and is rich in oil, gas and metals, had looked among the better placed nations to withstand the global financial crisis but Moscow has been among the worst affected markets.

In a surprise move, Iceland said it wanted Russia to extend a 4-billion euro ($5.4-billion) loan from its huge reserves to strengthen the Nordic island's currency. Finance Minister Alexei Kudrin said Moscow viewed the request "positively" and would make a final decision on it after negotiations with Icelandic officials.

Kudrin also said the extra funds for banks, offered for periods of at least five years, would help ease the credit crunch by allowing banks to lend over long periods. Of the money, 500 billion roubles would come from the central bank and the rest from the state budget, he said. Much of it would be funnelled via state savings bank Sberbank.

The crisis meeting took place in the Kremlin one day after Russian stocks suffered their heaviest one-day falls. The dollar-denominated RTS index collapsed by 19.1 percent as panic gripped the market and investors fled to safe havens.

MEDVEDEV MOVE FAILS TO IMPRESS MARKET

Tuesday's bailout sparked a brief stock market rally but it quickly petered out and Russian shares touched new three-year lows. The rouble-based MICEX index closed 0.96 percent down at 744 points, and the dollar-based RTS ended the day 0.95 percent down at 858 points.

/... http://www.reuters.com/article/marketsNews/idINL711103620081007?rpc=44&sp=true

[antigop]

95. U.K. may take stakes in Barclays, Lloyds and RBS: Source

But banks either deny reports or won't comment; 'going to be heavily dependent on government'

http://financialweek.com/apps/pbcs.dll/article?AID=/20081007/REG/810079987/1036

Britain and its banks will hold more urgent talks over a possible multi-billion pound injection of public money into the sector over coming days, an industry source said as the financial crisis tightened its grip.

News of talks held on Monday night between the banks and the with Chancellor of the Exchequer Alistair Darling sent shares in Royal Bank of Scotland, Lloyds TSB and Barclays plunging on Tuesday as investors feared their holdings might be diluted if the government were to buy a big stake.

The cost of insuring the banks’ debt fell on hopes the new capital could take the pressure off existing debt.

Some reports said the banks were seeking 15 billion pounds ($26 billion) each to help them get through the crisis, which began in the United States last year when mortgages holders defaulted on payments.

The source told Reuters the next round of talks will focus on what form of equity the government would receive in return for providing banks with any injection of taxpayer’s money.

[Ghost Dog]

102. Here's one for the mattress-stuffers:

Spanish hoards of €500 notes could aid liquidity

It is, perhaps, the strangest idea yet for pumping extra liquidity into Europe's troubled banking system. Spanish officials were yesterday reported to be looking for ways of encouraging Spaniards to remove the estimated 108m €500 notes they have hoarded in safes or under floorboards and take them to the bank. That averages out to at least two per Spaniard, or a total of €54bn, circulating outside the country's banking system.

A combination of tax-cheating and a long-standing mistrust of banks, means Spain soaks up a quarter of all the €500 notes - one of the world's highest denomination bank bills - released every year.

One option for getting the notes into the banking system, by offering a no-questions-asked fiscal amnesty, was ruled out by the finance minister Pedro Solbes yesterday. El Mundo newspaper reported, however, that there had been pressure from within the government's finance team to consider a fiscal amnesty. Spain's tax inspectors, whose job it is to root out the notes when they are used for tax fraud, were among those opposing the idea.

The purple €500 notes are so rarely seen that they have earned the nickname "Bin Ladens".

...

Spain is estimated to have one of the biggest black economies in Europe, accounting for between 20 and 23% of annual GDP. Spanish tax authorities are investigating 12,000 big transactions involving €500 notes.

/... http://www.guardian.co.uk/world/2008/oct/07/spain.black.market

Also,

Black Market Accounts for 28% of South Korean GDP

South Korea's underground economy accounts for nearly 28 percent of its gross domestic product (GDP), the highest among the Organization for Economic Cooperation and Development (OECD) members.

The underground economy, or black market, refers to businesses that are conducted illegally under the government's radar to evade taxes through untraceable settlement methods such as money laundering and cash transactions. The government has been trying to reduce underground economic activities for years but it still has a long way to go.

Activity on the black market triggers a vicious cycle as it forces the government to raise more taxes from salaried workers and the self-employed to cover losses in tax revenue and downgrades the value of goods and services produced in both public and private sectors.

According to data submitted to Rep. Lee Jong-koo of the Grand National Party by the National Assembly Research Service, Tuesday, the size of Korea's underground economy was equivalent to 27.6 percent of its total output in 2005, the largest among 22 OECD member economies. The size of the black economy reached $218 billion, as the nation produced goods and services worth $791 billion within the country that year.

The underground economy in the United States accounted for 7.9 percent of its GDP; 8.5 percent in Switzerland; 8.8 percent in Japan and 23.2 percent in Italy. The OECD average was 14.8 percent.

/... http://www.koreatimes.co.kr/www/news/biz/2008/10/123_32276.html

[Demeter]

106. 30 Years of Fascism Will Do that to a Country

[Ghost Dog]

132. Indeed. n/t

[Roland99]

104. 11:55am - Which way do we go? Which way do we go?

Dow9,955.26 -0.24
Nasdaq1,855.96 -7.00
S&P 5001,056.37 -0.52
10-year3.50% +0.08
Oil $89.70 $1.89
Gold $882.70 $16.50

[Dr.Phool]

109. He went thataway!

Picking up steam.

Maybe we'll be locking that "annoying" pool today.

[TalkingDog]

107. Revenge fantasies lived out: Fuld socked in the kisser at the gym.

http://www.breitbart.tv/?p=189663

http://www.businessandmedia.org/articles/2008/20081006150152.aspx

While former Lehman CEO Richard Fuld was testifying before the House Oversight Committee Oct. 6, CNBC reported he had been punched in the face at the Lehman Brothers gym after it was announced the firm was going bankrupt. CNBC and Vanity Fair contributor Vicki Ward said Fuld was attacked at the gym on a Sunday following the bankruptcy.

[Dr.Phool]

111. Knocked his ass out! Cold.

When he was complaining about short-sellers undermining Lehman, he was at the exact time shorting the shit out of a hedge fund with billions stashed at Lehman.

Maybe he should have gotten a good stomping too.

[ozymandius]

116. I would pay fifty damn dollars to see the video.

One hundred damn dollars to see it in person.

[Dr.Phool]

120. $500 to participate!

[Demeter]

230. I Want the Beer and Popcorn Concession!

[AnneD]

112. Bouncing Back After Being Laid Off

The unemployment rate hovers at 6.1% and, during September, employers cut a higher-than-expected 159,000 jobs, according to the latest report from the Labor Department. Not only is that more than double the layoffs during either July or August, but it's also the worst decline since 2003, when the economy was still in the throes of a recession.

"It's a further sign -- certainly not the first -- that nobody is guaranteed a paycheck," says Tory Johnson, CEO of Women for Hire, a career web site. "Everyone needs to wonder, 'What about me? Am I next?'"

Things will get worse before they get better, predicts Richard Ebeling, a senior research fellow with think tank American Institute of Economic Research. Many of the recent job losses stem from the embattled financial sector. The spending habits of Wall Street's elite, especially come annual bonus time, typically result in widespread booms in the retail, housing, tourism and hospitality industries. Now that tens of thousands of financial-services employees are out of work and bonuses have been slashed, those sectors will undoubtedly take a hit, he says.

much more...........

http://www.smartmoney.com/deal-of-the-day/index.cfm?story=Bouncing-Back-After-Being-Laid-Off

Pink slips are the new black:eyes:

[DemReadingDU]

135. It's already 7.4% in Ohio

9/20/08 Ohio's unemployment rate rises By William Hershey
State's joblessness at 7.4 percent, the highest it's been since 1992.

COLUMBUS — Ohio's unemployment rate increased to 7.4 percent in August, the highest jobless rate since October 1992, according to data released Friday, Sept. 19, by the Ohio Department of Job and Family Services.

The August unemployment rate was up slightly from 7.2 percent in July and more than a point higher than the 5.7 percent rate in August 2007.

The U.S. jobless rate for August was 6.1 percent, up from 5.7 percent in July.

"Ohio's labor market continued to mirror the national trend by showing signs of decline in August," Helen Jones-Kelley, ODJFS directors, said.

"Larger decreases in the goods-producing sectors resulted from continued losses in manufacturing and durable goods."

Overall, Ohio's nonfarm wage and salary employed dropped by 3,700 over the month, from 5,410,500 in July to 5,406,800 in August.

The number of unemployed workers in the state in August was 445,000, up from 432,000 in July.

During the past 12 months, the number of unemployed has increased by 106,000, from 339,000.

The unemployment news comes against the backdrop of a gloomy national economy, declining state tax returns and a continuing state budget crisis that saw Gov. Ted Strickland announce $540 million in budget adjustments last week, including $198 million in spending cuts.

more...
http://www.daytondailynews.com/n/content/oh/story/news/local/2008/09/20/ddn092008jobs.html


10/1/08 Republicans have controlled the White House for the past eight years. And during that time, reckless Republican policies have undermined Ohios economy and put its workforce and their families in great danger. How bad have these policies been for Ohio?
-1,087 Factories and Companies in Ohio Shut Down
-180,264 Ohio Workers Lost their Jobs
http://www.youtube.com/watch?v=xjYutDMDW9E

[Roland99]

113. 12:35pm - Found a direction! South!

Dow 9,827.03 -128.47
Nasdaq 1,828.16 -34.80
S&P 500 1,041.12 -15.77
10-year 3.47% +0.05
Oil $90.05 $2.24
Gold $880.00 $13.80

[RUMMYisFROSTED]

114. -163.92

[Roland99]

121. 12:50pm - Deeper South

Dow 9,751.68 -203.82
Nasdaq 1,818.59 -44.37
S&P 500 1,033.91 -22.98
10-year 3.48% +0.05
Oil $90.05 $2.24
Gold $878.90 $12.70

[AnneD]

115. Five Best Cities for Job Hunting

According to the latest Best-Performing Cities survey from economic think tank the Milken Institute, metro areas like Provo-Orem, Utah, and Raleigh-Cary, N.C., are actually bucking national unemployment trends by offering opportunities in growing sectors like technology and health care. (The survey tracks data on job creation, wage increases and the amount of the region's GDP that stems from technology products and services created between 2002 and 2007, the most recent data available. The survey also takes into account the Bureau of Labor Statistics employment data from March 2007 to March 2008.)

Besides playing host to growing industries, another defining feature of the cities that topped the Milken Institute's list was that these locales were relatively unaffected by the housing meltdown, says Ross DeVol, director of regional economics at the Milken Institute. In fact, cities in California and Florida that traditionally make the list fell off this year due to the impact of the subprime mess on housing and construction labor markets.

So where should job seekers go to find work? View our slideshow to find out which metro areas the Milken Institute says are ripe for hiring:

Where should job seekers go to find work? View our slideshow to find out which metro areas the Milken Institute says are ripe for hiring:
....more
http://www.smartmoney.com/deal-of-the-day/index.cfm?story=Five-Best-Cities-for-Job-Hunting&split=0


But for my money, the best place now is Houston, but the lower the oil prices slide-the more jobs will dry up...Remember this current economic crisis is not our first rodeo. Been there done that have the spur scars.

[Roland99]

122. Houston? Ick. I'd take Raleigh any day over that.

:)

[AnneD]

131. When you are starving and on the edge of total disaster....

Houston looks pretty damn good. Hell, I'd even go to Utah (Raising Arizona theme song now stuck in my ear).

The weather is sucky but everthing else about Houston is nice. Ike made me really aware of what a good community this really is. I'm bias-sue me.

[Dr.Phool]

134. We've got everything down here in Florida except jobs.

As longas you don't mind gators, snakes, no see-ums, mosquito's, republicans, and other pests. At least you won't freeze to death on the park bench.

[Roland99]

146. Yeah, if I wanted stifling humidity nearly year-round, I'd head to Orlando

At least I could walk around WDW once in a while. :)

[Dr.Phool]

177. We could all go to Vegas. It's a dry heat.

But, then again, so is a blow torch.

[Roland99]

239. So is my oven but I don't want to live in there!

:)

[AnneD]

281. The flying tree roaches....

you forgot those 5 inch nasties...

[AnneD]

280. And everyone meets their friends for dinner....

at 4:00pm :eyes:

[Robbien]

123. OMG How stupid is this

From the UK Spectator:

http://www.spectator.co.uk/coffeehouse/2203316/coffee-house-exclusive-what-the-russians-want-in-return-for-bailing-out-iceland.thtml

Sources in Reykjavik, who've now read our story, tell Coffee House that Iceland turned to Russia for a loan after the EU, the Scandinavian countries and the US Federal Reserve turned it down.



So for a mere five billion, Russia got access to a naval base a few hours away from North America. Of course since Iceland is in NATO the naval base will belong to Iceland, but one can assume access to the base is one of the conditions of the bailout.

[ozymandius]

128. Doorknobs have higher I.Q.s.

But then Bush and his enabler buddies have never set the bar very high in political calculus. Who writes this policy? This should have been a no-brainer. Oh wait...

[Ghost Dog]

145. The Spectator is a right-wing British weekly magazine.

Look at their cover: http://www.spectator.co.uk/

They're just arousing their nationalist readership, stirring up trouble.

What "sources" are they referring to? Reuters has quoted EU officials denying any formal approach from Iceland on this.

On the other hand, no doubt Russia would be looking to negotiate some kind of quid pro quo.

[Robbien]

228. Ouch

Didn't realize it was a wingnut site cause I directly accessed from Google News. Sorry.

Really though. Unless the US Fed steps in, Iceland is almost out of options. Eurozone doesn't have enough cash to cover their own banks much less Iceland's. The only resources Iceland has are Norway, Russia and China. Perhaps this story got leaked in order to goose Norway or the US Feds into sharing their cash. The US Feds are so busy stuffing taxpayer money into their own pockets it is possible they are being so blinded by greed to see past their own immediate interests. So if this story isn't true right now, it is possible with this gang of thieves it could be true very soon.

[ozymandius]

124. Off-topic here: I just voted.

I had to wait twenty minutes to cast my ballot at Atlanta/Fulton County government complex. There was a steady stream of people through the fourth floor registration/voting area. One overheard conversation involved one Obama supporter talking about how many people (lots) she registered to vote in Fulton County.

Apparently, this is the norm instead of the exception according to diarist VolvoDrivingLiberal at DailyKos. I estimate that 95% of those voting with me were African-American.

[AnneD]

125. Five moves to make now to shore up your future

It's not over.
Monday's U.S. stock sell-off triggered by global investor panic is just the latest wild day on Wall Street. Given that we're probably in a recession that just has not been declared, it's time for those managing their personal portfolios and family finances to hunker down for the long haul. Here are some steps to take offered by financial experts Greg McBride of BankRate.com, Joe Hurley of SavingforCollege.com and Brent Collins of SmartStops.net.

1. Rebalance your portfolio. Sell some of what, if anything, has gone up and buy more of what has gone down. Rebalancing enforces the discipline of buying low and selling high.

2. Buy shares in your 10 ``most wanted'' stocks that you never bought because they were too expensive. It's likely you will consider them cheap right now.

3. Move money from a taxable brokerage account in a child's name into a 529 college-savings plan. Market declines will make the capital gains low on the sale and may trigger a capital loss. The strategy allows you to move the money into a tax-free 529 plan.

4. Build up your emergency savings to six months of expenses by putting money in savings and certificates of deposit. They offer higher returns than Treasurys and are risk-free because of bank account insurance.

5. Create an exit plan for selling a portion of your holdings in stocks, exchange-traded funds and mutual funds. If the stress of buying and holding is too much for you, sign up for online services at SmartStops.net or Morningstar.com that will alert you when a stock, ETF or mutual fund has hit the targeted lows.

http://www.chron.com/disp/story.mpl/business/6043798.html

This has some good ideas but I disagree. The first thing on you list should be build up an emergency fund of at least 1K. Credit will tighten up and cash will be king. A thousand in savings will take care of most of your needs. This is your raining day fund and folks-it's pouring!!!!!You want a cash cushion esp if you may be laid off. Just pay minimum on your credit balances if you are in dire straights. Remember-food clothing and shelter (lights heat rent or mortage and a way to work) everything else is not important in a crisis. AND FOR GODS SAKE QUIT DIGGING THE HOLE-don't go out and buy a new car while you still have credit. It will be repoed from you. Pay cash for your cars!How much grief I could have saved if someone had told me this years ago when I was laid off.

[kineneb]

141. and if you are already poor,

non-perishable foods (I can use food stamps) and ammo (just in case)

[TalkingDog]

150. Don't forget liquor. (or beer) n/t

[llmart]

246. $1K????

Here in Michigan that $1K won't pay your basic monthly bills let alone buying groceries.

[AnneD]

279. That is a starter....

to keep you off credit cards. If you know or suspect a layoff pile more in-3-6 months of living expenses. I wound up do bare bones living. When I went through unemployment for over a year-it was food, clothing, shelter, beans one night, rice the next. I cut off cable, went to the library for intertainment.

If you are working, 1K takes care of most emergencies.

[llmart]

282. Sorry...

I thought the implication in the post was that $1K in savings would be enough if you were laid off. That sounded very low to me.

As for me, personally, I am a proponent of voluntary simplicity anyway and have been for a very long time. We have a substantial amount of money saved because of it. The mantra these days seems to be "live within your means." I would say that's not enough. My mantra has always been "live below your means".

[AnneD]

283. Lots of folks think they can't live without credit cards......

this is a good way to make the tranition. Since we have had that emergency account-we've not used cards. Funny but most emergencies can be handles for under 1K. We have been card free for 5 years now and believe me , we have emergencies. But it is nice to know you have money to take care of them without going into the hole.

[Ghost Dog]

126. Bank of Canada injections now total C$1.675 bln

Tue Oct 7, 2008 12:22pm EDT TORONTO, Oct 7 (Reuters) - The Bank of Canada injected C$1.675 billion ($1.649 billion) into markets on Tuesday to lower the overnight interest rate toward the central bank's target and improve liquidity.

/.. http://www.reuters.com/article/marketsNews/idCATOR00354820081007?rpc=44

[Ghost Dog]

129. Europe stocks fall on weaker banks; RBS, HBOS sink

Tue Oct 7, 2008 12:41pm EDT

* FTSEurofirst 300 ends 0.14 pct lower

* Royal Bank of Scotland, HBOS slip about 40 pct

* Commodities gain on higher metals, crude prices

/... http://www.reuters.com/article/marketsNews/idCAL736286320081007?rpc=44

FTSE rebounds on commods as RBS, HBOS sink 40 pct

Tue Oct 7, 2008 12:21pm EDT

* FTSE 100 ends up 0.4 pct

* Banks thrashed on funding concerns

* Commodity stocks gain on firmer metal and crude prices (For full coverage of financial turmoil, click on )

/... http://www.reuters.com/article/marketsNews/idCAL721558220081007?rpc=44

[Ghost Dog]

130. ECB's Quaden says rate cut no longer ruled out

Tue Oct 7, 2008 12:28pm EDT BRUSSELS, Oct 7 (Reuters) - The European Central Bank has changed its stance in the light of the global financial crisis and a cut in interest rates is no longer excluded, ECB Governing Council member Guy Quaden said on Tuesday.

"The financial planet is in total crisis," the governor of the Belgian National Bank told a parliamentary committee hearing on the financial turmoil and bailout of Belgian-based banks.

Quaden said that while the ECB kept rates on hold at its meeting last Thursday, ECB President Jean-Claude Trichet had clearly introduced "a change in the bank's communication".

"There was no decision but, I think it was said quite clearly, in the current circumstances, in the new circumstances, a cut in the official European interest rates is no longer excluded," he told deputies.

"Perspectives for economic activity have considerably weakened, inflation risks remain but they are less significant."

/... http://www.reuters.com/article/marketsNews/idINL725953320081007?rpc=44

[Robbien]

140. US banks shamelessly sold their worst toxic sludge to gullible European banks

and insurance companies, and the clean-up costs will be enormous and destabilizing. Several other leading European banks such as UniCredit in Italy look vulnerable after the collapse of Fortis in Belgium. In response to the Hypo crisis, Germany has apparently guaranteed local bank deposits, following the lead of Ireland and Greece, and obliging other EU members to follow suit rapidly or suffer capital flight.

Fine in principle, but the balance sheets of many of these banks dwarf government revenues; Hypo alone has €400 billion in assets, and needs upwards of €100 billion in refinancing through end 2009.

http://seekingalpha.com/article/98764-cds-market-it-s-crunch-time

[Ghost Dog]

189. Yeah. Won't be so gullible next time, we hope.

Trying not to get angry about it, I guess. Caveat emptor and all. However, outright fraud is something else...

Under the doctrine of caveat emptor, the buyer could not recover from the seller for defects on the property that rendered the property unfit for ordinary purposes. The only exception was if the seller actively concealed latent defects.

[UpInArms]

136. "They were getting facials, manicures, and massages, while the American people were footing the bill

http://www.reuters.com/article/topNews/idUSTRE49666720081007?sp=true

WASHINGTON (Reuters) - U.S. regulators sent a letter to American International Group Inc in March warning of its lack of transparency and ability to oversee its financial products, a top Democratic lawmaker said on Tuesday.

Rep. Henry Waxman, who chairs the House Oversight and Government Committee, revealed the letter from the Office of Thrift Supervision (OTS) and a warning by AIG's accountants about material weaknesses at a hearing into the insurer's near-collapse and federal bailout last month.

"We are concerned that the corporate oversight of AIG Financial Products ... lacks critical elements of independence, transparency, and granularity," read Waxman, of California, from the March 10 OTS letter.

U.S. lawmakers are holding a series of hearings to probe the causes of the financial crisis and to propose changes to the regulatory system.

AIG's woes led the Federal Reserve Bank of New York on September 16 to lend up to $85 billion to the cash-strapped insurer over two years in exchange for a 79.9 percent equity stake.

Lawmakers, mostly Democrats, expressed outrage at perks AIG executives enjoyed less than a week after the bailout, including a spa retreat where AIG racked bills for $200,000 for hotel rooms and $23,000 for spa services.

"They were getting facials, manicures, and massages, while the American people were footing the bill," said Rep. Elijah Cummings, a Maryland Democrat on the oversight panel.

...more...

:banghead:

where is the outrage???

[Dr.Phool]

142. Outrage?

:rofl:

Less than 1/10th of the American public will hear about this. If it comes on the TV, they'll flip over to "Flip This House", and fantasize about all the money they could make on these foreclosed houses in the neighborhood.

[nadinbrzezinski]

137. You do not hear the Fed Chairman speak to us the people

that often

This is not good...

[UpInArms]

139. nah - he blathers all the time - it would be nice if he would stfu and quit "signaling" his buddies

05. Bernanke: Fed open to new ways to improve market functioning
1:08 PM ET, Oct 07, 2008

06. Bernanke: Fed to use 'all tools at its disposal'
1:08 PM ET, Oct 07, 2008

07. Bernanke: Weak growth may linger due to financial turmoil
1:08 PM ET, Oct 07, 2008

08. Bernanke: Inflation picture has 'improved somewhat'
1:08 PM ET, Oct 07, 2008

09. Bernanke: Outlook for growth is worse, for inflation better
1:08 PM ET, Oct 07, 2008

10. Bernanke: Current neutral stance may not be appropriate
1:08 PM ET, Oct 07, 2008

16. Bernanke signals shift towards rate cut in Fed stance
1:08 PM ET, Oct 07, 2008

[nadinbrzezinski]

148. Not on MSNBC, or CNN

that is what I mean

Here is the scary part.. he is TRYING to splain what this is all about... but most folks lost him a while ago

[UpInArms]

158. oh - sorry - didn't know what you were seeing

we "see" him in the line item news all the time -

you're right - most folks wouldn't understand a word he says and the stuuupid MSM doesn't even have a filter to tell them that whatever this prick has to say is garbage - in and out - he's a fool and cretin and should have stayed in his ivory tower and mumbled alone about his "printing press" instead of being allowed out to play (not so well) with others.

:hi:

[nadinbrzezinski]

172. Hey, he was followed by boy george

and the ghost of hoover

[UpInArms]

156. lips still flapping

02. Bernanke not ready to declare victory over inflation
1:35 PM ET, Oct 07, 2008

03. Bernanke: Global slowdown would bring down commodity prices
1:33 PM ET, Oct 07, 2008

04. Bernanke sees inflation easing 'pretty significantly'
1:32 PM ET, Oct 07, 2008

05. Bernanke: Global slowdown key to benign inflation outlook
1:32 PM ET, Oct 07, 2008

[54anickel]

183. Victory?!?! Not ready to declare makes it sound like we're "on the cusp" of victory rather than

at the edge of the jagged cliff called deflation.

And what's with the second line? "Hey, look at the bright side commodities will come down." Of course they'll never become free and that's where we'll need them to be once we all hit the unemployment and bread lines!

He's not winning the battle against inflation,as much as he's loosing the one against asset deflation. Cripes, does he think we're stupid or something.

[RUMMYisFROSTED]

138. Goodbye 9700. We hardly knew ye! -272.87....9682.63

[Roland99]

144. "Chopper" Ben hints at a rate cut. DJIA -192 and recovering.

[Roland99]

149. Not holding... -236 ... -282. Lookout below!!

[RUMMYisFROSTED]

151. Chopper nearly out of fuel...

[54anickel]

147. Got Beck's "Going Down" stuck in my head now.

http://www.youtube.com/watch?v=WUHy_TfkN38&feature=related

[Mojorabbit]

160. I haven't heard that song in years

Took me back to an excellent concert in the 70's era.

[54anickel]

272. Yeah, always loved the studio version though.

[ozymandius]

153. 1:48 and Dow -293

Dow 9,661.52 Down 293.98 (2.95%)
Nasdaq 1,800.71 Down 62.25 (3.34%)
S&P 500 1,023.74 Down 33.15 (3.14%)
10-Yr Bond 3.477% Up 0.051
NYSE Volume 3,972,876,750
Nasdaq Volume 1,571,754,875

1:30 pm : Stocks fall to session lows in choppy action as Fed Chairman Bernanke gives his speech on the economy. He is currently participating in a question and answer session.

Bernanke said the Fed will need to consider whether the current policy stance remains appropriate, noting there are increased economic risks while the inflation outlook has improved. This indicates that the Fed may be considering a rate cut. The Fed has left the fed funds rate unchanged at 2.00% for the last three meetings, citing both downside risks to growth and increased inflation concerns. Fed funds futures suggest a 28% chance the Fed will cut rates by 75 basis points on Oct. 29.

According to Bernanke, the slowdown in economic activity has spread outside of the housing sector. He said payrolls are contracting, purchasing powers of households have eroded and increased uncertainties have begun to weigh on business investment spending.

The minutes from the Sept. 16 FOMC meeting are set for release in a half hour.DJ30 -228.91 NASDAQ -51.99 SP500 -27.28 NASDAQ Adv/Vol/Dec 767/1.48 bln/1940 NYSE Adv/Vol/Dec 706/781 mln/2436

[Roland99]

157. shouldn't that read "choppery" action?

[fascisthunter]

152. -271.68 ..... "Gravity is only a Scientific Theory"

[antigop]

154. Krugman: Third World America?

http://krugman.blogs.nytimes.com/2008/10/07/third-world-america-2/

Blog entry:

One thing I learned way back in grad school was that there was a big difference between the assets of first-world, mature-country central banks and those in rickety developing economies. The Fed and its peers had clean balance sheets, with basically nothing but Treasury bills on the asset side. Third world central banks, on the other hand, did a lot of direct lending to the private sector, and had all sorts of dodgy assets on their books.

Now the Fed is in the business of directly buying commercial paper, in some cases unsecured. Wow.

I’m not saying this is a bad idea — until Treasury comes back with a bailout plan that actually makes sense, Bernanke has to try everything he can to hold the system together. But it is shocking how fast things have gone downwill.

Downwill?

[ozymandius]

175. What a delightful stroll down memory lane.

Back before Friedman economics fulfilled their promise, dad and I would sit around the campfire and chat about how quaint it would be for the United States of America to resemble a banana republic.

:sarcasm:

[Roland99]

155. 1:49pm - ... -300 (edit...-331 now)

Dow 9,655.15 -300.35
Nasdaq 1,798.25 -64.71
S&P 500 1,022.12 -34.77
10-year 3.47% +0.05
Oil $90.05 $2.24
Gold $876.50 $10.30

[ozymandius]

159. I was about to contribute that sudden lurch downward.

Dow 9,624.24 Down 331.26 (3.33%)
Nasdaq 1,794.41 Down 68.55 (3.68%)
S&P 500 1,015.48 Down 41.41 (3.92%)
10-Yr Bond 3.488% Up 0.062
NYSE Volume 4,109,021,500
Nasdaq Volume 1,623,838,750

1:55

[Roland99]

162. Volume kicking up this afternoon?

[ozymandius]

164. not to a stark degree

Looks like another 6 billion shares traded on the NYSE. But that's been fairly normal over the past four months.

[ozymandius]

163. Check out the blather that Chopper Ben wrote all by himself.

1:30 pm : Stocks fall to session lows in choppy action as Fed Chairman Bernanke gives his speech on the economy. He is currently participating in a question and answer session.

Bernanke said the Fed will need to consider whether the current policy stance remains appropriate, noting there are increased economic risks while the inflation outlook has improved. This indicates that the Fed may be considering a rate cut. The Fed has left the fed funds rate unchanged at 2.00% for the last three meetings, citing both downside risks to growth and increased inflation concerns. Fed funds futures suggest a 28% chance the Fed will cut rates by 75 basis points on Oct. 29.

According to Bernanke, the slowdown in economic activity has spread outside of the housing sector. He said payrolls are contracting, purchasing powers of households have eroded and increased uncertainties have begun to weigh on business investment spending.

The minutes from the Sept. 16 FOMC meeting are set for release in a half hour.DJ30 -228.91 NASDAQ -51.99 SP500 -27.28 NASDAQ Adv/Vol/Dec 767/1.48 bln/1940 NYSE Adv/Vol/Dec 706/781 mln/2436

---

No shit, mister. I interact with people who try living in this economy outside the Ivory Tower every damn day.

[WannaJumpMyScooter]

166. spread outside the housing market has it?

does that mean the problem is not just in the sub-prime loans too?

[ozymandius]

168. Do I detect a bit of sarcasm in your tone?

In case this is not sarcasm, without any intended sarcasm myself, the contagion has spread from sub-prime to Alt-A to prime on the past months. Even the jumbo loan writers, signifying the top-tier credit market, have suffered from delinquencies and foreclosures. That is just not supposed to happen. Upper-middle class and wealthy homeowners are getting caught in the liquidity trap.

[WannaJumpMyScooter]

242. oh no, not a bit... a lot

I find it amazing that it takes so long for the "leaders" in the economy to see what dumb bunnies like me live with

[Ghost Dog]

223. "inflation outlook has improved". Wasn't he hitherto mostly

quite sanguine, in denial, about any risk of inflation?

[ozymandius]

165. Anyone for new thread? How's this one loading for you? nt

[Lydia Leftcoast]

169. Oops, I spoke too soon

The dollar is falling again against the yen.

[Ghost Dog]

234. Works as a useful hedge

(in the traditional sense of the term), so far, doesn't it. Although it pays almost zero interest, and I wouldn't jump back into the Tokyo/Osaka markets in general just yet...

(ed: Not Advice).

[Lydia Leftcoast]

250. I'm not in the stock market at all, but most of my customers are in

Japan, so my pay rates are denominated in yen. That's why I'm interested. :-)

[AnneD]

170. Official says pension funds are down $2 trillion

WASHINGTON — The top congressional budget analyst says pension plans have lost as much as $2 trillion in the past 15 months.

Peter Orszag told a House panel on Tuesday that the losses are likely to force many workers to hold off on major purchases and delay their retirements.

The panel was investigating how the housing, credit and financial troubles battering the economy have affected retirement savings.

More than half the people surveyed in a recent Associated Press-GfK poll said they worry that they will have to work longer because the value of their retirement savings has declined.

http://www.chron.com/disp/story.mpl/ap/business/6044715.html

[Mojorabbit]

171. I watched this

week as my pitiful mutual fund IRA's were decimated. I am just numb now.

[ozymandius]

174. My wife has watched her 401-k melt. Funny how a mixed, balanced portfolio

can somehow start to resemble a pocketful of penny stocks. At least there is no longer an urge to sell because we 'do not feel like holding stocks over the weekend'.

[Mojorabbit]

176. Yes

I am pretty much over the emotional shock of it. I am in a "Oh well" state of mind. I am just going to roll with the flow. I still can't help watching the whole situation, kind of like watching a slow motion train wreck.

[ozymandius]

173. Some recovery underway

Dow 9,711.06 Down 244.44 (2.46%)
Nasdaq 1,806.56 Down 56.40 (3.03%)
S&P 500 1,028.43 Down 28.46 (2.69%)
10-Yr Bond 3.475% Up 0.049
NYSE Volume 4,565,655,000
Nasdaq Volume 1,836,253,75

2:05 pm : The major indices continue to tumble, and all three are now down more than 3%. They are trading modestly above yesterday's intraday low.

At the Sept. 16 FOMC meeting, the fed funds rate was left unchanged at 2.00%, with the Fed citing significant concerns to both downside risks to growth and upside inflation risks. The decision was unanimous.

The minutes for the Sept. 16 FOMC meeting were just released. The minutes stated that some policy members leaned toward a rate cut, as the the Fed saw easing in inflation risk. Some policy members felt intensifying financial strains that led to the economic outlook worsening will prompt for a rate cut at the Oct. 29 meeting.

Morgan Stanley (MS 15.16, -8.34) is getting hammered, down 35% on no specific news item. The financial sector is down 8.2%, and hit a fresh 52-week low.DJ30 -328.15 NASDAQ -74.45 SP500 -39.37 NASDAQ Adv/Vol/Dec 654/1.66 bln/2066 NYSE Adv/Vol/Dec 590/866 mln/2565

[ozymandius]

179. and down again

3:06
Dow 9,630.78 Down 324.72 (3.26%)
Nasdaq 1,788.17 Down 74.79 (4.01%)
S&P 500 1,019.13 Down 37.76 (3.57%)
10-Yr Bond 3.51% Up 0.084
NYSE Volume 5,292,677,500
Nasdaq Volume 2,138,289,500

3:00 pm : The recovery effort is short-lived as the major indices fall toward session lows. All ten economic sectors are posting a loss.

Bank of America (BAC 25.41, -6.79) is two thirds done pricing its $10 billion common stock offering, compared to the expectations that it would be priced prior to the open, according to CNBC. The offering is now expected to be priced below $25 per share, a discount of at least 22%, CNBC reports.DJ30 -304.22 NASDAQ -69.39 SP500 -35.45 NASDAQ Dec/Adv/Vol 2141/617/2.09 bln NYSE Dec/Adv/Vol 2575/590/1.09 bln

[Betty]

180. losing 300 a day.. how long till dow 0?

at this rate...can we make it till Xmas and still have a positive number? Bush's final turd in the punch bowl.

[ozymandius]

216. If I see that book, "Dow 30,000", at Goodwill next time - I'll buy it.

It's pretty thick. And it's cheaper than toilet paper.

[loudsue]

186. That recovery didn't last long. Blood everywhere!

Dow down -378 and counting.

Another meltdown day?

[Coventina]

190. Ouch.

My 401k is Morgan Stanley

*sigh*

I've come to the conclusion that I'll be working until the day I die.

Maybe I should take up smoking....

[llmart]

247. I may take up hooking.....

there's always a demand for that but I don't think my 60-year old body will get too many takers:)

[UpInArms]

181. Retirees flee stocks to save shrinking nest eggs

http://www.reuters.com/article/domesticNews/idUSTRE4966HT20081007

ST. CHARLES, Illinois (Reuters) - This time around John Abel was ready for the stock market crash.

"Back in 2000 before the dot-com bubble burst I listened to my financial adviser and lost $80,000," said the 65-year-old retiree in his home in the western Chicago suburb of Saint Charles. "That destroyed my remaining faith in the markets."

In February, 2008, after falling stock markets wiped out virtually all their recent gains, Abel and his wife Carol decided to move their money into long-term corporate bonds.

Just before the House of Representatives' September 29 rejection of a $700 billion financial sector bailout plan led to a 778-point fall of the Dow Jones industrial average, the Abels moved into a U.S. government securities fund.

"I'm going to watch that fund very closely and if there's any trouble we'll move into certificates of deposit," said Abel, who worked in public relations for nonprofit groups and passes the time building furniture. "I'm 65 and don't have time to wait for things to get better."

Retirees like the Abels around the United States face the same dilemma: How much can they afford to lose in a down market and how long can they wait to recoup their losses?

For many the answer is: Get out while you can.

...more...

[TalkingDog]

194. I can imagine the physical bank runs will start soon.

Before now, the loan sharks had mostly been running on each other.

I think before the end of this week the folks across the street at the Bakery Thrift Store will be getting twitchy....



from my recent slide show:
http://www.flickr.com/photos/28571432@N02/show/

[Ghost Dog]

249. Excellent work. Thanks.

[muriel_volestrangler]

182. UK govt to recapitalise banks - £50 billion?

UK banks are set to agree a £50bn injection of taypayers' money under a bold plan to resolve the crisis in credit markets. Banking chiefs were this evening due to meet the Prime Minister to discuss the proposals, scheduled to be announced tomorrow morning, but subject to seeing the detail, are understood to have already agreed to be supportive. The plan could mean substantial dilution for some shareholders.

http://www.independent.co.uk/news/business/comment/jeremy-warner/banks-set-to-agree-pound50bn-package-954340.html

Government to unveil bank rescue

The UK government is poised to announce details of a comprehensive rescue package for the banking system, the BBC's business editor has learned.

It will include a proposal to inject capital into banks and to provide a standby facility to ensure UK banks have enough cash.

This is the government's attempt to stabilise the country's banking system.

The news comes after a day of steep falls in UK banking stocks and a high-level Downing Street meeting.

http://news.bbc.co.uk/1/hi/business/7657422.stm

After this:

HBOS Closes 41.5% Down, RBS -39.2%, LLOYDS TSB -13%, and Barclays -13.8%

[Ghost Dog]

251. So it'll be an overnight move, with insiders already acting today...

No surprise there, then. :mad:

[Cerridwen]

184. Did I just see a 300 pt. jump from one browser refresh to the next?

Wow. Faeries shooting from the far corner...YEAH! It's in! Nothing but net! And the crowd goes wild!

edit to add: Awwww. The crowd is booing. Ooooo, foul called on the play. No score!

[JNelson6563]

185. This is getting to be like Groundhog Day

The Movie.

Sending out Chopper Ben and Little Boots doesn't seem to have done the trick. Wonder what tomorrow's strategy will be. They are runnin' out of tricks.

Julie

[loudsue]

187. Right Julie. Seems like "tricks" is all they've ever had.

I don't think the market has reflected real value in a very long time.

[Pale Blue Dot]

188. That's what I've been thinking.

Nothing's working anymore. Nothing. The only question is whether the crashes are slightly less bad because of these stupid actions they're taking.

Makes me wonder where the bottom is. :scared:

[DemReadingDU]

193. So much turmoil with the European banks too

It seems like when one of the troubled banks, and not sure which country, but there will come a day that it can't be propped up any longer. That's when the dominoes start falling, all over the world.
Just my guess.

[Ghost Dog]

253. Defcon1? n/t

[RUMMYisFROSTED]

191. Goodbye 9600. We hardly knew ye! -381.67 9573.83

[RUMMYisFROSTED]

192. 5 seconds later...9500 in deep trouble! -437.98

[UpInArms]

197. 3:48 EST 9,500 in the rearview - will S&P go under 1,000?

Dow 9,498.64 456.86 (4.59%)
Nasdaq 1,765.44 97.52 (5.23%)
S&P 500 1,002.64 54.25 (5.13%)
10-Yr Bond 3.506% 0.08

NYSE Volume 6,262,159,500
Nasdaq Volume 2,524,392,750

[UpInArms]

195. 3:44 EST about to kiss 9,500 good-bye

Dow 9,518.15 437.35 (4.39%)
Nasdaq 1,771.84 91.12 (4.89%)
S&P 500 1,005.82 51.07 (4.83%)
10-Yr Bond 3.506% 0.08

NYSE Volume 6,181,801,500
Nasdaq Volume 2,492,196,000

[54anickel]

201. Who flushed? Damn, wish I'd have yanked it all out and buried it like the Abel's in #181. n/t

[Tansy_Gold]

245. Whatever is left in mine, and it wasn't much to begin with, I just

faxed a "cash me out" form.

I was going to do it last week and was just too busy with too many things.


Oh well.


TG

[llmart]

248. Glad I did....

Rolled over hubby's 401K from Merrill Lynch into a 3-year CD at 5.25% today. I feel so smart:)

[54anickel]

252. I'm at about 50/50 and the funds that I do still hold are supposedly diversified, though that

certainly didn't appear to do me much good when I checked my last statement. Sort of like what Ozy was saying about his wife's 401K.

[Ghost Dog]

254. Hell, I'm amazed assiduous followers of this thread didn't do

mostly that at least 18 months ago.

[llmart]

267. I had a money market account....

of my own that I put into laddered CD's about 7 months ago. It was actually nice getting a monthly check that I could rely on even though I didn't use the money. I still have some in Vanguard's Index 500 fund but I'm not touching that yet. There's a tiny bit of optimism in me that it will be better once Obama's in office.

[54anickel]

271. I've been hanging here for 5 years, mostly doomin' and gloomin'. Sort of became

complacent and numb to it all. Thought I was pretty well diversified - gold, silver, CDs, money market, some mutual funds and an annuity. My IRA hasn't fallen below the amount I originally rolled-over when I lost my job, but it's getting pretty damned close. I'm gonna fire my money guy though. Every time I wanted to swap my mutual funds for Treasuries he talked me out of it.

[Ghost Dog]

274. Yeah, in my experience the "money guys", the "financial advisors",

most of them, have just been in it for themselves, since quite some time now.

Whatever helps them keep their jobs and their commissions...

I've been running my own ops for some years now. Got out of some funds in April 2000 at the top of the bubble, then waited, then made some forays (I've not been a day trader, but rarely hold a stock market position for more than a few months), switched what was left in USD out to Euros and Yen at the end of 2005, switched almost entirely into high-quality money markets last year...

And inflation is still eating away at me, of course.

[MilesColtrane]

196. With the end of trading in sight it looks like the old Cocoanut Grove rush for the exit.

[TalkingDog]

199. I'll take a double! n/t

YIKES!

[RUMMYisFROSTED]

198. Goodbye 9500...We weren't even introduced...

:cry:

[UpInArms]

200. 9500 doing an encore just for you, RiF!

3:51 EST

Dow 9,512.50 443.00 (4.45%)
Nasdaq 1,771.43 91.53 (4.91%)
S&P 500 1,004.48 52.41 (4.96%)
10-Yr Bond 3.506% 0.08

NYSE Volume 6,395,081,500
Nasdaq Volume 2,591,787,750

[Cerridwen]

202. Only for a moment then back behind the curtain.

Reminds me of Gypsy Rose Lee. Lot o' tease. Limited skin.

[dweller]

206. the curtain fell on the heads of the chorus line

during the high-kick...and they are splayed all over the stage...even into the orchestra pit!

dp

[Cerridwen]

211. Blood and dead faeries everywhere.

It's an ugly sight.

The after close clean-up crew is making it worse. S&P under 1000.

It's awful. Oh, the humanity.

:cry:

[dweller]

233. "The horror... the horror..."

the closing number? the Doors 'The End'

dp

[RUMMYisFROSTED]

203. Pleased to meet you. What's that? You have to be going?

By .95
...
...and gone.

[UpInArms]

205. say hello to 9,400 quick! hurry!

Dow 9,451.09 504.41 (5.07%)
Nasdaq 1,756.75 106.21 (5.70%)
S&P 500 1,001.91 54.98 (5.20%)
10-Yr Bond 3.506% 0.08

NYSE Volume 6,725,670,000
Nasdaq Volume 2,723,346,250

[RUMMYisFROSTED]

208. Laughing through the tears.

[54anickel]

217. Oh my, consumer credit fell $8 biggies while expected to rise $5! That'll leave a mark!!!

Reported at 3:00 PM ET, consumer credit fell $7.9 billion in August on a seasonally adjusted basis, compared to the expected gain of $5.0 billion. This marked the first month-over-month decline since 1998.

[Demeter]

235. Somebody Drank Their Lunch that Day

and read the Magic 8 Ball upside down.

[DemReadingDU]

204. 2 credit unions close

10/3/08 TEXDOT-WF Credit Union Closes; Members Now Served by Postal Family Credit Union
The National Credit Union Administration (NCUA) announces today that Postal Family Credit Union, of Wichita Falls, Texas, has purchased the assets and assumed member shares of the recently liquidated TEXDOT-WF Credit Union of Wichita Falls, Texas.
more...
http://www.ncua.gov/news/press_releases/2008/MR08-1003b.htm


10/6/08 N&W Poca Division Federal Credit Union Closes
The National Credit Union Administration (NCUA) placed N&W Poca Division Federal Credit Union of Bluefield, West Virginia, into liquidation October 3, 2008.
more...
http://www.ncua.gov/news/press_releases/2008/MR08-1006.htm


My apologies to finnfan, who mentioned this yesterday

[Pale Blue Dot]

221. That's it - now I'm angry!

How dare you steal my news! I hope you're properly ashamed.

:rofl::cry::hug:

[TalkingDog]

207. Place your bets: Hi/Lo the now PIL 9500?

Above or Below?

Easy money...

come on now...50/50 chance....


Last Call. Place your bets!

[UpInArms]

210. betcha 9,000 is the new PIL by the end of the week

[RUMMYisFROSTED]

214. Or tomorrow.

[Dr.Phool]

212. I don't think there's a PIL anymore.

[Pale Blue Dot]

222. I agree. We're in uncharted territory now. nt

[OakCliffDem]

278. 6750 in a week

[MilesColtrane]

209. *gulp*

DJIA 9,459.21 -496.29 -4.99%
NASDAQ 1,754.95 -108.01 -5.80%

[UpInArms]

213. S&P went under 1,000

Dow 9,449.66 505.84 (5.08%)
Nasdaq 1,754.88 108.08 (5.80%)
S&P 500 996.45 60.44 (5.72%)
10-Yr Bond 3.506% 0.08

NYSE Volume 6,913,189,500
Nasdaq Volume 2,765,973,750

[RUMMYisFROSTED]

215. That's bad, right?

:D

[Ghost Dog]

236. Heh. Too right.

But the MSM loves the DOW, does it not?

[54anickel]

220. And to think that's with the ban on shorting still in place.

[Pale Blue Dot]

225. EXACTLY.

The ban expires after the 17th, right?

[54anickel]

240. Yep, unless they extend the extension. Certainly doesn't appear to be doing much good, but then

again it's basically on the financial sector - I thought that was a pretty good chunk of the S&P. What would it look like without the ban?

[Cerridwen]

218. Apathetic after close settling.

:(

It's like watching daily train wrecks in slooooooooooooowwwwwwwwwww mottttttttttiooooooooooooon.

[radfringe]

219. at this rate

we'll be busting into 8,000 levels by tomorrow

heckava job bushie!

[ozymandius]

224. Closing numbers continue to settle - DOWN.

Dow 9,447.11 Down 508.39 (5.11%)
Nasdaq 1,754.88 Down 108.08 (5.80%)
S&P 500 996.26 Down 60.63 (5.74%)
10-Yr Bond 3.506% Up 0.08
NYSE Volume 7,005,405,000
Nasdaq Volume 2,790,403,750

blather will follow

[loudsue]

226. Close at -508. Who wants to bet we see a 4 to 5,000 dow before the dust settles

in the next couple of years. After maybe the 3rd or 4th "bailout" vacation for the wealthiest 1% of the world's population?

So much for "you have to pass this NOW or the dow will lose 1500 points!!!"

[Juneboarder]

229. OMG... my MIL was just saying we'd get to $5000 before we know it!! n/t

[ozymandius]

232. Blather says something about providing 'liquidity'. Does that mean anything anymore?

4:20 pm : Tuesday marked another ugly session for stock investors as a weak outlook from Bank of America (BAC 24.05, -8.17) and cautious comments from Fed Chairman Ben Bernanke overshadowed a Federal Reserve plan to improve liquidity in short-term corporate borrowing.

Stocks rose 1.5% at the open on the Fed's plan to shore up short-term corporate borrowing, but overall economic concerns quickly sank stocks. In the end, the the S&P 500 plunged 5.7%, settling at its worst levels, to a new five-year low in broad-based weakness. All ten economic sectors posted a loss, with notable declines in financials (-11.5%), tech (-6.1%) and consumer discretionary (-5.7%).

Fed Chairman Bernanke gave the market little to cheer about in a speech at the National Association for Business Economics annual meeting. He said that economic activity is likely to be subdued through this year and into 2009 and increases in financial market turmoil may extend the period of weak economic performance.

He did leave the door open for a FOMC rate cut on Oct. 29, although fed funds futures had already priced in a cut of at least 50 basis points.

Bank of America, the second largest U.S. financial firm by market cap after JPMorgan Chase (JPM 39.86, -4.14), fell down 25% after preannouncing disappointing third quarter earnings and giving a dour outlook regarding the state of the economy. In an attempt to shore up capital in the face of current economic conditions, BofA is cutting its quarterly dividend by 50% to $0.32 and plans to raise $10 billion in a common stock offering.

CNBC reported the common stock offering was seeing weak demand, with an expected pricing of less than $25 per share. The notion that BofA would have to sell stock at a more than 22% discount added to overall investor unease, especially in the financial sector.

The commercial paper market, which many U.S. companies rely on for short-term borrowing, has been under pressure as investors flocked to the safety of Treasuries and away from money market funds. As a result, many companies found it difficult issue commercial paper, or had to pay a high cost.

In an attempt to bring down the cost of commercial paper costs and improve liquidity, the Fed announced this morning that it created a Commercial Paper Funding Facility, which will provide a liquidity backstop for the strained commercial paper market. The Fed will purchase three-month unsecured and asset-backed commercial paper from eligible issuers. The Fed said it has no limit to how much commercial paper it can buy.

Separately, Commodities (+1.0%) staged a modest recovery effort from Monday's 5.0% drop, aided by a 0.8% decline in the dollar. Crude prices rose 2.3% to $89.80 per barrel.

The S&P 500's loss marked its fifth consecutive decline, marking the longest losing streak since January. The index has fallen 14.5% over the past five sessions and is down 32.2% this year.DJ30 -508.39 NASDAQ -108.08 NQ100 -5.8% R2K -6.2% SP400 -5.4% SP500 -60.66 NASDAQ Dec/Adv/Vol 2370/434/2.82 bln NYSE Dec/Adv/Vol 2815/386/1.73 bln

[mrdmk]

231. Fed's minutes from the day Lehman Brothers went Bankrupt

WASHINGTON (AP) -- Even in the midst of a severe meltdown on Wall Street, Federal Reserve officials at their September meeting believed the risks from weaker growth and higher inflation were roughly equal.

The Fed officials discussed the financial turmoil during their closed-door meeting on Sept. 16, according to minutes released Tuesday. The meeting occurred a day investment bank Lehman Brothers collapsed -- the largest bankruptcy in U.S. history. It was also hours before the Fed announced it was extending an $85 billion loan to rescue American International Group, the world's largest insurance company.

While concluding that it would not change interest rates at the September meeting, the minutes showed some members said a policy response from the central bank might be needed.

Fed Chairman Ben Bernanke and his colleagues left the federal funds rate unchanged at 2 percent and kept the portion of the public statement discussing future actions balanced between worries about economic growth and inflation.

link: http://biz.yahoo.com/ap/081007/fed_economy.html

At this time seeing the Fed's minutes from the past year would be more appropriate. This episode in the World's economy did not happen overnight.

[Roland99]

241. SO worried about SHORT-TERM returns only!!!!

So worried about keeping up growth to the detriment of everything else!

[mrdmk]

260. Owning a house was part of Bush's Ownership Society plan

This plan fizzed out when Bush could not change Social Security. So the crash of the world's economy came early. Much to early for Bush's policies.

Remember the GNP for the last 5 years has been between 0.08% to 2.5%. An expanding housing industry was the reason the GNP was above the zero mark. If the housing market was in its normal state, Bush would have been dealing with a 5 year recession. The Bush administration wanted those loans to go through just to have a normal GNP. The financial institutions not only bowed to Bush's Ownership Society Plan, but also took advantage of the situation.

Now most people and those not born yet in the U.S.A. have to pay for this ruse...

[bain_sidhe]

237. Time for a new pool?

The day it closes below the lowest point during Bush's pResidency

October 9, 2002

7,286.27

I'm really hoping it doesn't get there, though!

[Dr.Phool]

243. We've got one now.

When it closes 20% below the number when chimpolini took office. It was posted on yesterday's thread. I expect Prag to post again.

It will be cut off to entries at 500pts above that figure.

[bain_sidhe]

259. Ah... missed it!

I wasn't able to check in more than briefly yesterday, and missed the pool! I'll watch for a repost. Thank you for the info!

[Hugin]

276. Here it is, bain_sidhe.

And maybe you can repost it tomorrow? Please?

My graphics card is about to go south. I can still READ DU, but, posting is an arduous task given the
limited input capabilities of my temporary back up. (Hey, I only have two opposable thumbs... Even though
there are rumors I may have more.)

:)

AnneD and I struck out today. Next up for 10/8 is uppityperson.

Good luck to uppityperson!

___________________________________________________________________________________________________________

Guess the date for when the Dow will close down 20% of it's value from the Great Reset value of 10,578. That would be
8462.59. I doubt anyone could claim there isn't a recession at that value.

Similar rules to AnneD's pool apply... HARSH REGULATION WILL BE OBSERVED! The pool will lock at 500 points above
the target value or 8963.59.


uppityperson... 10/08/08

radfringe... 10/09/08 (765 432 1 Countdown!)
dweller... 10/15/08
loudsue... 10/16/08
Karenina... 10/20/08
AnneD... 10/24/08 (Note: AnneD is a Sentimentalist)
Roland99... 10/27/08
Dr.Phool... 10/30/08
MsLeopard... 10/31/08 (Note: BOO!)
Wednesdays... 11/05/08
Pigwidgeon... 11/17/08


Good luck and keep a sharp eye for those ice bergs!
_________________________________________________________________________________________________________________

[bain_sidhe]

277. Thank you! And I'll be happy to repost tomorrow...

warning, though, it won't be until later in the day. We're a second-shift household around here.

:hi:

[Demeter]

238. Telegram Just In: "What Hath God Wrought?"

http://www.hmdb.org/Marker.asp?Marker=948



We have truly entered the Undiscovered Country. At least we have each other as company. Thanks for sticking around, everybody!

[Ghost Dog]

255. On the bright side?

Yesterday, from the McCain campaign:

"If we keep talking about the economic crisis, we're going to lose."

McCain desperately wants to change the subject from the economic crisis. Not going to happen.

/... http://www.americablog.com/2008/10/yesterday-mccain-strategist-if-we-keep.html

[UpInArms]

256. After the Bell: Alcoa's 3Q profit falls 52 percent

http://news.yahoo.com/s/ap/20081007/ap_on_bi_ge/earns_alcoa

PITTSBURGH - Aluminum producer Alcoa Inc. says its third-quarter earnings plunged 52 percent due to sharply lower prices, weaker demand and higher costs.

The Pittsburgh-based company earned $268 million, or 33 cents per share, for the three months ended Sept. 30, compared with $555 million, or 63 cents per share, a year earlier. The earlier amount included a net gain of 25 cents per share for Alcoa's sale of its stake in Aluminum Corporation of China Ltd., also known as Chalco.

Revenue edged down 2 percent to $7.23 billion from $7.39 billion in the third quarter of 2007.

Analysts polled by Thomson Financial, on average, expected profit of 50 cents per share on revenue of $7.23 billion. Those estimates typically exclude one-time items.

[UpInArms]

257. Hedge funds losses balloon in September: HFR

http://www.reuters.com/article/businessNews/idUSTRE4968YA20081007?feedType=RSS&feedName=businessNews?sp=true

BOSTON (Reuters) - Hedge funds' losses ballooned last month when the average portfolio tumbled 4.68 percent, marking the industry's worst monthly performance, according to new data released on Tuesday.

The average hedge fund has now lost 9.41 percent this year, data released by Chicago-based performance tracking group Hedge Fund Research showed.

Hedge fund managers and investors first began talking about the industry's losses at the end of September and Tuesday's numbers confirmed what many people already knew.

While the industry's losses are less than the average stock mutual fund's drop, they are shocking to investors who entrusted millions to managers in return for promises to make money in all markets.

The industry's year-to-date losses are now more than double the 4.83 percent drop seen in the first eight months of the year.

Managers and investors blamed September's violent stock market moves plus regulators' ban on selling stocks short and the collapse of Lehman Brothers for the accelerated losses.

Some of the industry's biggest names numbered among the industry's losers -- Kenneth Griffin's Citadel Investment Group, Dan Loeb, an activist investor, and Lee Ainslie, who once worked for industry legend Julian Robertson.

The biggest losers were hedge funds that focused on energy and basic materials. According to HFR they lost 13.21 percent in September, putting them down 20.84 percent for the year.

...more...

[MilesColtrane]

263. I wonder just how much of what's going on inside hedge funds has to do with...

...this collapse.

I know Gramm-Leach was a leading cause, but the fact that no one really knows what machinations are happening in those black box, secret clubs makes me suspicious.

[Ghost Dog]

264. Rate cut lifts real estate stocks 20% (In Israel)

Tel Aviv stocks were spurred north yesterday by the Bank of Israel's surprise interest rate cut, a good three weeks before its next scheduled monetary announcement.

Tel Aviv's investors awoke yesterday hoping that the uptick on Wall Street and on European markets would lift Israeli shares, at least a little. But nobody could have predicted the dramatic events of late afternoon yesterday, when Bank of Israel Governor Stanley Fischer suddenly slashed lending rates by half a percent to 3.75%.

The rate cut is good for the banks, borrowers and the battered real estate sector. Investors responded by sending finance-sector stocks and the Real Estate-15 index soaring almost 20% on heavy turnover.

Total turnover was rather heavier than usual, at NIS 2.4 billion.

At the end of the day the TA-25 index gained 3.9% to 798 points, though the index of blue chips is still down 6% from last Thursday.

The TA-100 index climbed by 4.6% to 761 points, though it too is down 6% for the week. The TelTech-15 index, which is heavy with dual-listed stocks traded on Nasdaq, jumped 6.8% yesterday.

Investors had only yesterday to respond to the Bank of Israel's totally unexpected move, and to the overseas developments of the day before. The Tel Aviv Stock Exchange will remain closed until next Sunday, because of Yom Kippur, followed by the weekend.

/... http://www.haaretz.com/hasen/spages/1027437.html

[Ghost Dog]

265. BOJ supplies $20 bln in dollar funding operation-Kyodo

Tue Oct 7, 2008 7:42pm EDT TOKYO, Oct 8 (Reuters) - The Bank of Japan on Wednesday said it allotted $20 billion in its dollar supply money market operation, Kyodo news reported, as part of worldwide central bank efforts to deal with strong dollar demand.

The central bank said bids amounted to $36.299 billion in the operation to supply three-month dollar funds, Kyodo reported. That gives a bid-to-cover ratio of 1.81.

The average rate was 4.135 percent, Kyodo said.

It was the second such dollar funding operation by the BOJ.

The BOJ said the start date for the operation was Oct. 9 in the United States and the end date was Jan. 5, 2009, in the United States. The BOJ said the minimum bid rate at the auction was 1.390 percent.

/.. http://www.reuters.com/article/marketsNews/idINTKF00305120081007?rpc=44
________

Nikkei set to fall on Wall St slide, strong yen
Tue Oct 7, 2008 7:46pm EDT TOKYO (Reuters) - Japan's Nikkei share average is likely to fall on Wednesday after U.S. stocks tumbled on fears that the credit crisis would drag the economy into a deep recession, while a firm yen may deal an extra blow to exporters.

The benchmark is expected to break below 10,000 again on Wednesday after sliding briefly below that level and logging a five-year closing low at 10,155.90 the previous day, market participants said.

...

Nikkei futures traded in Chicago closed at 9,820, down 390 points from their close in Osaka, pointing to a lower opening.

Market participants expect the benchmark Nikkei .N225 to trade between 9,700 and 10,100.

...

Investors will also likely focus on Toyota Motor Corp (7203.T: Quote, Profile, Research, Stock Buzz). The Nikkei business daily said the automaker's consolidated operating profit for the year ending March 31 is expected to fall around 40 percent to about 1.3 trillion yen ($12.8 billion) as demand for autos declines.

...

Dentsu, Japan's top advertising firm, suffered its biggest monthly sales decline in nearly a decade as the financial crisis and slowing economy prompt corporate clients to tighten their budgets.

Dentsu said its non-consolidated net sales slumped 17 percent in September from a year earlier, the largest drop since February 1999, with advertising through newspapers, magazines, radio and TV all posting double-digit declines.

...

Corning Inc (GLW.N: Quote, Profile, Research, Stock Buzz), a rival of Nippon Electric Glass and Asahi Glass in glass for LCD panels, warned that third-quarter glass sales volume was worse than expected and said it was cutting spending and stopping outside hiring.

/... http://www.reuters.com/article/hotStocksNews/idUSTRE496A5S20081007?sp=true

[Ghost Dog]

268. Morgan Stanley Says Mitsubishi UFJ Accord `On Track'

Oct. 7 (Bloomberg) -- Morgan Stanley said its agreement to raise $9 billion from Japan's Mitsubishi UFJ Financial Group Inc. is ``on track'' after speculation the deal may fall through caused the company's stock to drop as much as 40 percent.

``The deal is proceeding on track'' and will close as soon as this weekend, said Mark Lake, a spokesman for New York-based Morgan Stanley. ``The deal is expected to close imminently upon expiration of the Federal Reserve's five-day post-approval waiting period.''

The Fed and other ``key global regulators'' have approved the agreement by Japan's largest bank last week to buy $3 billion of Morgan Stanley's common stock at $25.25 apiece and $6 billion of convertible preferred stock, Morgan Stanley said in a statement. The shares have closed below $25.25 every day since the agreement was reached.

``There's a rumor Mitsubishi may pull out,'' Fred Froewiss, vice president of institutional sales at RF Lafferty & Co. in New York, said earlier today. ``Maybe they're getting cold feet because of the freeze in the credit markets. The market is really trading on whispers and fear.''

/... http://www.bloomberg.com/apps/news?pid=20601101&sid=atVfrJwM2DLU&refer=japan

[Ghost Dog]

270. Nikkei falls 1.5 pct in first two minutes

Tue Oct 7, 2008 8:08pm EDT TOKYO, Oct 8 (Reuters) - ... As of 0002 GMT, the benchmark Nikkei .N225 shed 150.87 points to 10,005.03. On Tuesday, it slid briefly below the 10,000 level and logged a five-year closing low at 10,155.90.

The broader Topix declined 1.5 percent to 963.20.

/.. http://www.reuters.com/article/marketsNews/idCATKF00305220081008?rpc=44

[Ghost Dog]

275. Nikkei down 4 pct on economy fears, strong yen

Tue Oct 7, 2008 9:13pm EDT

(Updates to midmorning)

TOKYO, Oct 8 (Reuters) - The Nikkei average slid 4 percent on Wednesday as fears about the global economy spooked investors into dumping stocks, while a firm yen dealt an added blow to exporters.

Toyota Motor Corp (7203.T: Quote, Profile, Research, Stock Buzz) skidded nearly 6 percent after the Nikkei business daily reported that the automaker was likely to post a 40 percent slide in annual profit, missing its profit estimates on weak sales in North America and slower growth in China.

"The deteriorating outlook for the economy and the deepening financial crisis are pushing fears to their limit," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

"Investors want to dump some shares as their willingness to take risks has decreased, while no one wants to buy even if stocks are valued cheaply."

As of 0113 GMT, the benchmark Nikkei .N225 shed 409.70 points to 9,746.20. At one point it fell to its lowest level since late 2003.

The broader Topix declined 3.4 percent to 943.14.

/... http://www.reuters.com/article/marketsNews/idCAT5870520081008?rpc=44

[Ghost Dog]

273. Seoul shares open 3 pct lower

SEOUL, Oct 8 (Reuters) - Seoul shares opened 3 percent lower on Wednesday after Wall Street tumbled for a fifth straight session overnight on worries the credit crisis would drag the economy into recession, with higher oil adding to downward pressure.

Technology issues fell across the board on worries about consumer and business spending, sending Hynix Semiconductor <000660.KS> down 4.51 percent and Samsung Electronics down 2.26 percent.

Banks also fell across the board, with Shinhan Financial Group down 5.3 percent and Hana Financial Group <086790.KS> down 4.26 percent.

The Korea Composite Stock Price Index was down 2.87 percent at 1,326.95 points as of 0003 GMT, heading back towards two year lows hit on Tuesday.

/. http://www.moneyam.com/action/news/showArticle?id=3283644

[Ghost Dog]

266. Australia's S&P/ASX 200 Drops, Extending 3-year Low; Banks Fall

Oct. 8 (Bloomberg) -- Australia's benchmark stock index fell, extending a 3-year low, as banks and resources companies tumbled on concern more banks worldwide will fail, deepening the credit crisis and further slowing the global economy.

National Australia Bank Ltd., the nation's largest lender, dropped 3.5 percent, leading declines among financial companies. BHP Billiton Ltd. slumped 4.9 percent on fears worldwide demand for raw materials will weaken. Woodside Petroleum Ltd. dropped to the lowest in eight months.

``People have woken up to the fact this isn't purely a financial issue,'' said Angus Gluskie, who helps oversee $500 million at White Funds Management in Sydney. ``It's one that's impacting significantly on the underlying economy. We're probably looking at 12 to 18 months of global growth slowing significantly.''

The S&P/ASX 200 Index fell 3.3 percent to 4,467.50 at 10:20 a.m. in Sydney, the lowest since Nov. 2, 2005, wiping out yesterday's 1.7 percent gain. The index has lost almost a third of its value this year amid a credit freeze sparked by the U.S. subprime mortgage crisis.

...

Sino Gold Mining Ltd. jumped 5.5 percent after gold futures rose 1.8 percent to $882 an ounce in New York on speculation central banks around the world will cut borrowing costs, boosting demand for the metal as an alternative asset. Sino and Lihir Gold Ltd. were among the index's three best performers.

/... http://www.bloomberg.com/apps/news?pid=20601081&sid=awm1jsdt9LOo&refer=australia

[Ghost Dog]

269. Commonwealth Agrees to Buy HBOS Plc's BankWest Unit

Oct. 8 (Bloomberg) -- Commonwealth Bank of Australia, the nation's biggest provider of mortgages, agreed to buy HBOS Plc's Australian units for A$2.1 billion ($1.5 billion) as the troubled U.K. bank sells assets amid the global credit crisis.

...

Commonwealth Bank shares are suspended for two days as the company seeks to sell A$2 billion of new stock to fund the deal. The stock yesterday rose 2.6 percent, paring this year's decline to 24 percent.

/... http://www.bloomberg.com/apps/news?pid=20601081&sid=aZOObmFvybDU&refer=australia