STOCK MARKET WATCH, Wednesday April 1

[ozymandius]

Source: du

STOCK MARKET WATCH, Wednesday April 1, 2009

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

AT THE CLOSING BELL ON March 31, 2009

Dow... 7,608.92 +86.90 (+1.14%)
Nasdaq... 1,528.59 +26.79 (+1.78%)
S&P 500... 797.87 +10.34 (+1.31%)
Gold future... 925.00 +7.30 (+0.79%)
30-Year Bond 3.56% -0.04 (-1.14%)
10-Yr Bond... 2.69% -0.03 (-1.07%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie and Silver

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Read more: du

[dysfunctional press]

1. asia was mostly up...europe is all down..

futures looking down too.

[ozymandius]

3. It's a real April Fool's Day for the suckers who bought into the rally yesterday.

The last day of the 1Q is a fool's game anyway.

[dysfunctional press]

5. but...but...butt...march was UP for the month..,AND they sold more houses in january than february..

we're on our WAY baby. dow 36,000.2 -capitalism strikes back.

just don't compare february 2009 with february 2008- that's the OLD way of doing things.

[ozymandius]

7. I saw that book, Dow 36,000, at Goodwill for fifty cents.

That, too, was way overpriced. If there had been a negative sign in front of the price then the cashier and I could have talked turkey.

[ozymandius]

16. What Ritholtz says.

Like out of a scene from ‘Groundhog Day,’ Japan announced that they will unveil another stimulus plan, their 3rd in this down cycle and I don’t have enough fingers or toes to count how many stimulus plans the 2nd biggest economy in the world has had since 1990. My point is that there is no precedent whatsoever of a country’s government printing money and spending its way to prosperity, especially in the face of a massive deleveraging.

[ozymandius]

2. Market WrapUp

Tactical Analysis: Establishing the FLLOC (Part 1)
Exploring potential bear market outcomes
BY FRANK BARBERA, CMT

Down 200, up 200... clearly stock market volatility remains at lofty levels. Of course, anxiety on a number of fronts has eased in recent days as equities have stabilized and now turned in a strong recovery rally. Yet amidst the better days seen during the last few weeks, there are still many difficult questions to answer. Will the Geithner banking proposal entitled “the Public-Private Partnership Investment Program" (or PPPIP) actually succeed in stabilizing the banks? Or is this just another program attempting to place a band aid on the problem, rather then treating the root cause? Will the Fed ever actually be able to withdraw monetary stimulus without sending the economy back into a steep contraction, and if not, will this breed high inflation down the line?

And what about Quantitative Easing, the so called Q/E, wherein the Bernanke Fed has crossed the proverbial rubicon. Already auctions have run into serious problems in the UK which moved to Q/E ahead of the US. Will the US follow suit? And more importantly, are markets now getting nervous regarding the possibility that Bernanke means what he says? In the past, discussions of “using the printing press” have been mostly discounted on the premise that the Fed would never make a radical lasting move.

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

[ozymandius]

4. Today's Reports

08:15 ADP Employment Change Mar
Briefing.com -635K
Consensus -663K
Prior -697K

10:00 Construction Spending Feb
Briefing.com -2.0%
Consensus -1.9%
Prior -3.3%

10:00 ISM Index Mar
Briefing.com 37.0
Consensus 36.0
Prior 35.8

10:00 Ponzi Returns Mar
Briefing.com -18%
Consensus -20%
Prior 14%

10:00 Pending Home Sales Feb
Briefing.com -1.0%
Consensus 0.0%
Prior -7.7%

10:30 Crude Inventories 03/27
Briefing.com NA
Consensus NA
Prior +3300K

14:00 Auto Sales Mar
Briefing.com NA
Consensus NA
Prior 2.9M

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

[rfranklin]

15. Can hardly wait for the Ponzi returns....I've been doing really well...

As soon as Mr. Madoff gets out of jail, he's starting a new fund. I've got my check ready!

[UpInArms]

22. U.S. March ADP employment falls 742,000

01. U.S. March ADP employment falls 742,000
8:15 AM ET, Apr 01, 2009

01. U.S. March service-sector cuts 415,000 jobs
8:17 AM ET, Apr 01, 2009

02. U.S. March goods-sector cuts 327,000
8:17 AM ET, Apr 01, 2009

(eta - other details)

[Ghost Dog]

23. That's not good, is it.

:(

[CatholicEdHead]

26. No, not at all

:(

[tclambert]

37. That, sir, is not a very funny April Fool's joke.

Damn. CNN said 752,000. Not a joke. Three quarters of a million jobs lost in a single month! Hell, that would be a bad year. By my count, that's about 2 million jobs lost so far in 2009. 3 months. 1 quarter. Obama tax cuts kick in today. The stimulus package better start stimulating right quick. No economy can take much of this.

Two million people this year lost jobs. How will they pay their bills? How will they pay their mortgages? It doesn't matter if they had subprime, Option A, or standard 30-year fixed rate mortgages. If they lost their jobs, how can they pay? More foreclosures, more houses on an already glutted market, more toxic mortgage-backed securities. More bailouts paid for by fewer taxpayers.

Somebody has to break this spiral. I'm hoping it's not the ground.

[Dr.Phool]

44. Even worse, ADP is always wrong----on the low side.

Wait until Friday when the real numbers come out. They'll be worse.

[TalkingDog]

63. So if the substantive difference between deep recession and depression is unemployment

How are we looking?

I know the employment numbers are jiggered,so in the old school accounting we are probably already there. But I'm interested in how long they can keep that parrot nailed to it's perch.

Hey to all. Hope you are safe and well.

[UpInArms]

28. March ISM @ 36.3% - March new Orders Index @ 41.2% - Feb Pending Home sales up 2.1%

01. U.S. March ISM index 36.3%, up from 35.8% in Febraury
10:02 AM ET, Apr 01, 2009

02. U.S. March ISM index 36.3% vs. 36% expected
10:01 AM ET, Apr 01, 2009

03. U.S. March new orders index 41.2% vs. 33.1%
10:01 AM ET, Apr 01, 2009

04. U.S. Feb. pending home sales up 2.1%, trade group says
10:00 AM ET, Apr 01, 2009

[UpInArms]

57. Petroleum Inventories rise - crude prices fall

06. Crude extends losses after inventories data, down 4.2%
10:32 AM ET, Apr 01, 2009

07. U.S. gasoline inventories rise 2.2 million barrels last week
10:31 AM ET, Apr 01, 2009

08. Distillate inventories rise 300,000 barrels last week
10:31 AM ET, Apr 01, 2009

09. U.S. crude inventories rise 2.8 million barrels last week
10:30 AM ET, Apr 01, 2009

[ozymandius]

6. Oil falls below $49 in Asia amid gloomy data

BANGKOK – Oil prices slipped below $49 in Asian trade Wednesday as new signs of deterioration in the world's three biggest economies — the U.S., China and Japan — undermined crude's recent gains.

Benchmark crude for May delivery fell $1.19 to $48.47 a barrel by late afternoon in Bangkok in electronic trading on the New York Mercantile Exchange. That fall nearly wiped out overnight gains when the contract rose $1.25 to settle at $49.66.

....

Americans are collectively driving billions of miles less each month, and that has helped to push U.S. oil inventories to 16-year highs. On Wednesday, the government will release the latest oil inventory report, which is expected to show a build up of at least 3 million barrels.

....

In other Nymex trading, gasoline for May delivery fell 3.1 cents to $1.303 a gallon and heating oil fell 2.39 cents to $1.3440 a gallon.

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

[ozymandius]

8. GAO: Treasury should take a harder line with AIG

WASHINGTON – The Treasury Department should deny American International Group Inc. a $30 billion "contingency" bailout until the company agrees to take back millions in bonuses and negotiate cheaper exits from its financial contracts, congressional auditors said Tuesday.

The Government Accountability Office report also found that payouts from the $700 billion financial system bailout nearly halted over the past two months. The slowdown occurred as Treasury Secretary Timothy Geithner came under fire for moving too slowly to announce financial rescue plans and assemble a team to oversee the largest government market intervention ever.

Treasury should withhold the latest $30 billion of bailout money it committed to AIG until the failed insurer agrees to "seek additional concessions from employees and existing derivatives counterparties," the GAO report recommended.

....

As of March 27, Treasury had disbursed $303.4 billion from the TARP, according to the GAO report. That's only $9.7 billion more than Treasury had paid out by Jan. 23, at the start of Geithner's tenure.

http://news.yahoo.com/s/ap/20090331/ap_on_bi_ge/bailout_oversight

[aquart]

14. How did such sensible people wind up in our government?

[UpInArms]

21. Activists seek to oust AIG compensation chief: report

http://www.reuters.com/article/businessNews/idUSTRE53016O20090401?feedType=RSS&feedName=businessNews

(Reuters) - Activist investors are looking to block the re-election of American International Group Inc director James Orr, chairman of the insurer's board's compensation committee, the Wall Street Journal said.

The newspaper cited a letter sent to U.S. government-appointed trustees for the insurer.

Officials representing big union and public pension funds wrote to the trustees late on Tuesday, urging them to unseat Orr, saying he failed to adequately oversee $165 million in retention bonuses approved in early 2008, according to the paper.

The bonuses were paid to employees in AIG's Financial Products unit after the insurer had accepted up to $180 billion in government aid, sparking outrage from the public, politicians and President Barack Obama

The U.S. government appointed the three trustees after taking a stake in the insurer last year, and in early March the voting rights for the nearly 80 percent stake was transferred to them, the paper said.

The letter to the trustees comes from Gerald McEntee, president of the American Federation of State, County and Municipal Employees union; Richard Trumka, secretary-treasurer of the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO); and Denise Nappier, treasurer for the state of Connecticut, the paper said.

...more...

[Robbien]

58. "seek concessions from derivatives counterparties" What?

The website Seeking Alpha published an account Monday of a maneuver by American International Group (AIG) to: a) fraudulently capsize its balance sheet, in order to; b) force the government to pour more capital into the capsizing insurance giant, by; c) unwinding billions of dollars of credit transactions with banks that took the other side of those trades, in a way that; d) swelled those banks’ balance sheets with what was effectively a one-time gift, and; e) the Treasury knew about the scheme, and by; f) pumping the capital that AIG clamored for, gave its tacit approval.

Keep in mind, according to the Seeking Alpha account, this wasn’t a plan by AIG. This was an act: covert, at least from taxpayers - who, let’s be honest, aren’t going to understand the intricacies of sales of credit-linked notes - but overt, with the complicity of AIG executives, especially at its AIG-Financial Products unit, along with banks and Administration officials.

http://blogs.barrons.com/stockstowatchtoday/2009/03/31/web-site-details-aigs-gift-to-banks-backhand-to-taxpayers/


The govt, AIG and the banksters all agreed to the money laundering scheme and now the GAO is saying, "hey wait".

Concessions on what? The deals have already been consummated.

[ozymandius]

9. Desperate world leaders meet on economic woes

LONDON – Desperate but divided on ways to lift their nations from economic misery, world leaders converged for an emergency summit Tuesday holding scant hopes of finding a magic-bullet solution for the crisis that brought them hurrying to London. Even as President Barack Obama and the others were arriving, the U.S. acknowledged its allies would not go along with a massive burst of stimulus spending, while Europe was forced to backpedal from hopes for tighter financial regulation.

Instead, leaders are trumpeting the limited common ground they could reach, including more money for the International Monetary Fund and closer scrutiny of hedge funds and tax havens. As for the broader issues, they're hoping for the best — or at least that they will do no harm.

.....

One global change is being acknowledged: The forum for grappling with world economic problems has grown beyond the established eight post-war economies that dominated previous economic summits — the U.S., Britain, Germany France, Japan, Canada, Italy and Russia. Now, 20 nations are coming together in London, with fast-growing developing economies such as China, India, Brazil and Saudi Arabia — important players in any effort to coordinate economic policy — sitting as full negotiating partners.

.....

Adding to the pressure, French President Nicolas Sarkozy said Tuesday the leaders cannot afford to let the week pass without making substantial progress in fixing the world's economy.
...
European countries are pushing for a tougher regulatory system for global finance, while the U.S. is emphasizing more spending — an idea that holds little interest for Europeans wary about debt.

http://news.yahoo.com/s/ap/20090401/ap_on_bi_ge/g20_summit

[Dr.Phool]

17. The last time they had a gathering of this many criminals.

It was in Apalachin, NY in 1957. At least those guys were competent.

[Festivito]

10. Debt: 03/30/2009 11,043,588,980,678.90 (DOWN 1,965,130,110.02) (Little, mixed.)

(Debt up a tiny amount, FICA down.)

= Held by the Public + Intragovernmental(FICA)
= 6,753,702,140,034.65 + 4,289,886,840,644.25
UP 69,902,880.68 + DOWN 2,035,032,990.70

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.8, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,072,772 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,081.58.
A family of three owes $108,244.74. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 21 reports in the last 30 to 28 days.
The average for the last 21 reports is 4,829,699,334.67.
The average for the last 30 days would be 3,380,789,534.27.
The average for the last 28 days would be 3,622,274,501.00.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 48 reports in 69 days of Obama's part of FY2009 averaging 0.25B$ per report, 0.25B$/day so far.
There were 123 reports in 181 days of FY2009 averaging 8.28B$ per report, 5.63B$/day.

PROJECTION:
There are 1,392 days remaining in this Obama 1st term.
By that time the debt could be between 13.0 and 18.9T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
03/30/2009 11,043,588,980,678.90 BHO (UP 416,711,931,765.82 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 1,018,864,083,766.50 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
03/10/2009 +000,452,187,222.11 ------------********
03/11/2009 +000,187,775,216.55 ------------********
03/12/2009 +031,351,798,430.48 ------------**********
03/13/2009 -000,013,659,079.13 ----
03/16/2009 +047,789,810,398.18 ------------********** Mon
03/17/2009 +000,031,463,665.67 ------------*******
03/18/2009 +000,237,422,838.19 ------------********
03/19/2009 +004,087,134,960.77 ------------*********
03/20/2009 +000,429,200,142.60 ------------********
03/23/2009 -000,116,003,157.82 --- Mon
03/24/2009 +000,222,913,900.31 ------------********
03/25/2009 +000,059,898,960.86 ------------*******
03/26/2009 +007,175,786,187.90 ------------*********
03/27/2009 -000,468,145,936.78 ---
03/30/2009 +000,069,902,880.68 ------------******* Mon

91,497,486,630.57 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,378,957,177,419.83 in last 193 days.
That's 1,379B$ in 193 days.
More than any year ever, including last year, and it's 136% of that highest year ever only in 193 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 193 DAYS NOT 365.

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

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3808202&mesg_id=3808302

[Festivito]

64. Debt: 03/31/2009 11,126,941,485,713.37 (UP 83,352,505,034.47) (Big day.)

(Debt and FICA debts rise. Could be just ordinary bills so far.)

= Held by the Public + Intragovernmental(FICA)
= 6,833,543,454,712.90 + 4,293,398,031,000.47
UP 79,841,314,678.25 + UP 3,511,190,356.22

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.8, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,078,943 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,353.18.
A family of three owes $109,059.53. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 21 reports in the last 30 to 28 days.
The average for the last 21 reports is 8,719,169,346.59.
The average for the last 30 days would be 6,103,418,542.61.
The average for the last 28 days would be 6,539,377,009.94.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 49 reports in 70 days of Obama's part of FY2009 averaging 0.86B$ per report, 0.68B$/day so far.
There were 124 reports in 182 days of FY2009 averaging 8.89B$ per report, 6.06B$/day.

PROJECTION:
There are 1,391 days remaining in this Obama 1st term.
By that time the debt could be between 13.0 and 20.2T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
03/31/2009 11,126,941,485,713.37 BHO (UP 500,064,436,800.29 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 1,102,216,588,800.90 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
03/11/2009 +000,187,775,216.55 ------------********
03/12/2009 +031,351,798,430.48 ------------**********
03/13/2009 -000,013,659,079.13 ----
03/16/2009 +047,789,810,398.18 ------------********** Mon
03/17/2009 +000,031,463,665.67 ------------*******
03/18/2009 +000,237,422,838.19 ------------********
03/19/2009 +004,087,134,960.77 ------------*********
03/20/2009 +000,429,200,142.60 ------------********
03/23/2009 -000,116,003,157.82 --- Mon
03/24/2009 +000,222,913,900.31 ------------********
03/25/2009 +000,059,898,960.86 ------------*******
03/26/2009 +007,175,786,187.90 ------------*********
03/27/2009 -000,468,145,936.78 ---
03/30/2009 +000,069,902,880.68 ------------******* Mon
03/31/2009 +079,841,314,678.25 ------------**********

170,886,614,086.71 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,462,309,682,454.30 in last 194 days.
That's 1,462B$ in 194 days.
More than any year ever, including last year, and it's 144% of that highest year ever only in 194 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 194 DAYS NOT 365.

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

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3809884&mesg_id=3809908

[ozymandius]

11. Home Prices: Low, But Still No Bargain

Homeowners are watching anxiously for any signs of housing market stabilization. So, too, are all those who believe the market may hold the key to the economy.

And yet the most recent data makes for more gloomy reading.

The closely watched Case-Shiller index, which tracks prices across twenty major cities, shows that through January the crash was getting worse, not better.

....

The headline numbers are grim enough. January's Case-Shiller index showed a 19% slump from a year earlier. The usual suspects fared very badly: Phoenix was down a remarkable 35%. Las Vegas fell 32% and Miami 29%.

....

Even today, prices overall have only reverted to levels seen in late 2003. Yet by that stage the bubble was already well inflated. You would expect a crash of this scale to retrace its steps much further. To find pre-bubble prices you have to go back to about 2000 – when values overall were about a third lower than they are today.

It's true that mortgage rates, now at 4.5% to 5%, are currently very low. But relying just on that is far too simplistic. Rates were also low from 2003 through 2005 – as many pointed out, disastrously, at the time.

http://online.wsj.com/article/SB123853857749575441.html

[tclambert]

39. My favorite foreclosure joke:

One bank here has foreclosed on so many homes, they are now giving away a free house when you open a new checking account. They were giving customers a choice of a free house or a free toaster, but they ran out of toasters.

[tclambert]

41. You see, people were choosing a free toaster over a free house.

Toasters hold their value better. Sigh. If you have to explain it, . . . maybe it's too sad to be funny.

Want to hear some tasteless 9/11 jokes? My favorite: What the FUCK were all the psychics doing on September 10th? Didn't they feel any spiritual vibrations they thought they should warn anybody about?

[Tansy_Gold]

46. Re: Bowling for Columbine --

Just be glad they aren't handing out free guns.. . . . . .


That had to be the single scariest part of that movie for me. . . . . .



Tansy Gold, anti-gun but not a nut (well, maybe a roasted and salted almond. . . .)

[tclambert]

50. Yeah, that was surreal, a bank handing out guns.

All they needed was fill in the blank robbery notes to go with 'em.

[ozymandius]

12. Potential GM bankruptcy plan includes company split

NEW YORK (Reuters) - A possible bankruptcy plan being discussed for General Motors includes quickly forming a new company of the automaker's most profitable parts, while a group of other units would remain under bankruptcy protection for a longer period, a source familiar with the plans told Reuters on Tuesday.

GM also would seek to have a new deal in place with the United Auto Workers union prior to any bankruptcy filing, the source said.

GM warned earlier on Tuesday that there is a rising chance it could file for bankruptcy by June, as the company has 60 days to reach deeper concessions with bondholders and unions after its previous restructuring plan was rejected by the U.S. government as insufficient.

....

Old components of the company not included in the new GM, such as Saturn and Hummer, would remain in bankruptcy over a longer period of time to be sold or wound down, said the source.

During a transition period, the new GM would have to coordinate with the old GM for some time and share certain operational activities, like accounting and insurance, the source said.

http://www.reuters.com/article/wtUSInvestingNews/idUSTRE53005220090401

[tclambert]

18. They say it will be a "quick rinse" bankruptcy, but Delphi's story turned out otherwise.

From Reuters: http://www.reuters.com/article/reutersEdge/idUSTRE52U8BL20090401

Auto bankruptcy: Quick surgery or long slog?

By Emily Chasan and David Bailey - Analysis

NEW YORK/DETROIT (Reuters) - The U.S. government, now directing the turnarounds of General Motors Corp (GM.N) and Chrysler, has said bankruptcy for both could be fast, clean and targeted -- like surgery or a "quick rinse."

But bankruptcy has been described by those who pass through it as a world of pain and regret, and skeptics question whether the developing plans for bankruptcies at the cash-strapped automakers could hit unforeseen snags down the road.

. . .

The best and most recent example of an auto bankruptcy gone wrong: Delphi Corp (DPHIQ.PK), the former parts division that GM spun off in 1999 to save money. Delphi filed for bankruptcy protection in 2005 and planned to retool its operations into a stronger, leaner company. But the company ran into difficulties with its exit financing and remains in Chapter 11 as a continuing drag on GM.

"Delphi's bankruptcy has been a real disappointment," said Kirk Ludtke, senior vice president at CRT Capital Group. "Delphi has made a lot of progress ... but the outcome has been a huge disappointment for investors."

[tclambert]

19. More on Delphi.

On March 31st, Delphi announced it will sell its brakes-and-suspension business to BeijingWest Industries Co. More American manufacturing to China. Maybe the Chinese will keep the plants here open for awhile.

Delphi used their bankruptcy filing in 1999 as a way of coercing huge concessions from their unions. Workers took big pay cuts in order to "save the company." They are still working on that last part. Delphi was a former GM unit and is still a major parts supplier to GM.

If GM goes into bankruptcy, it is bound to hurt Delphi. And what happened to Delphi workers and retirees may happen to GM workers.

[ozymandius]

13. Affidavit: Madoff associates knew of scheme, joined anyway

(CNN) -- Associates of convicted Wall Street swindler Bernard Madoff knew he was scamming his clients but joined in anyway because of the big money they could make, a securities investigator testified in a sworn affidavit for a Connecticut court.

The testimony by investigator Edward H. Seidle on Tuesday came as a Connecticut judge froze the funds of Madoff and several of his business associates as part of a lawsuit filed for members of a city's retirement fund who say they invested with companies linked to Madoff.

In his affidavit, Seidle said Madoff's associates -- specifically the so-called "feeder funds" that handled money for Fairfield, Connecticut's retirement plan -- should have known that he was cheating his clients.

.....

He named feeder funds Tremont Properties, Maxam Capital, their principals and their affiliates in the affidavit.

http://edition.cnn.com/2009/CRIME/04/01/madoff.funds.frozen/?iref=mpstoryview

[UpInArms]

20. dollar watch

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

Last trade 85.461 Change -0.125 (-0.16%)

Sterling Rises As Manufacturing Activity Jumps, PM Gordon Brown Calls For Urgent Action At G-20

http://www.dailyfx.com/story/bio1/Sterling_Rises_As_Manufacturing_Activity_1238580661413.html

The Pound would reach an intraweek high of 1.4111 on the back of a better than expected March manufacturing PMI reading that rose to a five month high of 39.1 from 34.7. Although activity remained in contraction for an 11th month, it was the first clear sign that the decline has ended and future growth may be expected as new orders reached the highest level since last August. However, the amount of money that Britons pulled from their homes fell to the lowest since records began in 1970 at -£8.0 billion from -£5.7 billion. This will reflect in future demand for high ticket items such as automobiles and could lead to a reversal of last month’s gains manufacturing as it will weigh on future consumer consumption. .

U.K. Prime Minister Gordon Brown met with President Barack Obama ahead of the G-20 meeting today and called for “long-term change in banking board rooms” and expects that global leaders will agree on coordinated efforts to boost growth. . Additionally, the U.K. PM said that he was prepared to act to prevent deflation which could be a sign of further quantitative easing from the BoE. We could see the pound weaken on the prospect that the central bank will continue to print more money in an effort to fuel growth and loosen credit markets. However, if the G-20 meeting spurs hope of global growth then sterling could benefit from increasing risk appetite. Indeed, President Obama called for less protectionism and PM Gordon Brown has called for the creation of a $100 billion pool of trade credits to help boost the flow of trade, which should be viewed as a positive by traders.

The Euro has spent the majority of overnight trading session in a tight 60 pip range between 1.3170 – 1.3230 despite a slew of weak fundamental data. German retail sales in February unexpectedly declined by 0.2% following a 0.9% drop the month prior which was significantly below expectations for a 0.3% gain. A weakening labor market in the country has weighed on consumer spending and with Euro-zone unemployment rising to a three year high of 8.5% in February, we may see the same for the entire region. Meanwhile, the final EZ PMI reading for March was revised lower from 34 to 33.9 signaling that the economy may continue to contract. The ECB is expected to lower their benchmark rate by 50 bps in the face of the declining economy at tomorrow’s rate decision, but the question is will they offer further solutions. The central bank has remained under pressure from home and abroad to take more aggressive action and follow the Fed and BoE in exploring quantitative easing measures. The upcoming G-20 meeting could be the catalyst for the policy committee to attempt to get ahead of the curve in which they have been lagging since the crisis began.

The dollar was mixed overnight but we may see volatility pick up during the U.S. session as the economic calendar is filled with event risk. The ADP private employment report is expected to show another month of private sector job losses in excess 650,000. The ISM manufacturing reports which is strong indicator for future activity and has grown in importance is expected to show that activity slightly increase to 36.0 from 35.8. However, given that he New York and Chicago regional readings registered their lowest in record a disappointing print is very likely. Yet, a positive print combined with the expected improvement in pending home sales could inspire risk appetite and weigh on the dollar. Indeed, the number of home in the process of closing are expected to have remained flat which in conjunction with recent surprises in existing home and new home sales may be a sign that the housing market is beginning to bottom. Yet, a looming ECB rate decision, G-20 meeting and NFP report could keep markets quiet today.

...more...

EUR/USD: Trading the U.S. ISM Manufacturing Report

http://www.dailyfx.com/story/topheadline/EUR_USD__Trading_the_Change_in_1238499543725.html

Manufacturing activity in the U.S. is expected to contract for the fourteenth consecutive month in March as businesses face fading demands from home and abroad however, the data could foreshadow a stabilizing market as economists forecast the ISM index to increase to 36.0 from 35.8 in February.

Trading the News: U.S. ISM Manufacturing

What’s Expected

Time of release: 04/01/2009 14:00 GMT, 10:00 EST
Primary Pair Impact : EURUSD

Expected: 36.0
Previous: 35.8

Impact the U.S. ISM Manufacturing has had on EURUSD over the last 2 months


February 2009 U.S. ISM Manufacturing
The ISM report showed that manufacturing in the U.S. contracted for 13 consecutive months in February, but fell at a slower pace from the previous month as the index increased to 35.8 from 35.6 in January. The breakdown of the report showed new orders ticked lower to 33.1 from 33.2, while the employment component slipped to 26.1 from 29.9, which is the lowest since recordkeeping began in1948, and the data continues to foreshadow a deepening recession in the world’s largest economy as the labor market deteriorates at a record pace. As households continue to face falling home prices paired with fading demands for employment, the outlook for private-spending remains weak, and conditions are likely to get worse as firms continue to cut back on production and investment in response to the downturn in global trade.


...more...

[ozymandius]

72. It's good to see you back after a couple of days off, UpInArms.

I was beginning to worry.

[DemReadingDU]

24. Charles Hugh Smith: SURVIVAL+ Chapter Five

Survival+ 5: Trends and Cycles of History (April 1, 2009)
Charles Hugh Smith

Many of us recognize that paper money (i.e. fiat money) has declined precipitously in value when priced in gold. Rather than watch our wealth (as measured in currency or gold) vanish, then we seek to find a store of value which will not fall to zero: gold.

But this "solution" assumes the "problem" is limited to paper (fiat) money. If we understand that "money" as a store of wealth is simply stored energy, then we reach another understanding of "the problem" and thus of the "solution."

Let's say that the fragile supply chain of remaining oil breaks down in a complex interaction of positive feedback loops. Oil would not just be costly; it would be unavailable to individuals. The government would undoubtedly ration what was left for essential services like agriculture, food distribution, police and hospitals, etc.

Let's say we anticipated this and responded not by hoarding gold but by buying a 100 KWhr/day solar power array, productive land in a mild climate, a store of fertilizer and a few electric vehicles to share with our family/community. We own zero gold but we own a power supply, the means to grow food and transportation that does not require petroleum.

Now would we sell these productive assets for gold? At what price, if they were essentially irreplaceable? What would we do with our pile of gold if we can't go anywhere, can't grow food and have no power source?

The holder of gold assumes that all goods can be purchased with a means of exchange holding a tangible value, i.e. gold or an equivalent commodity. But this may not be entirely true. Yes, we will sell some of our power/energy output for gold, but we will not sell our "wealth" i.e. the power plant for gold, which may or may not be able to buy a replacement. As a store of wealth, gold is no match for a productive source of energy.

The reason is "money" as a store of wealth is simply stored energy. From this point of view, fertilizer is stored energy. You may or may not be able to exchange "money" in any form for stored energy, for "wealth" is either stored energy or the capacity to generate energy sustainably. Everything else is merely a means of exchange.

Will gold hold more value as a means of exchange than paper money? If history is any guide, yes—but that's a different "problem" than building or storing wealth.

Continue reading Chapter Five...
http://www.oftwominds.com/blogapr09/survival5-04-09.html


link backwards to previous chapters...
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3802924&mesg_id=3803554

[DemReadingDU]

25. Map of unemployment rates by county

http://www.npr.org/blogs/money/2009/03/the_zone_of_sanity.html

[CatholicEdHead]

27. It looks like the energy industries in the great plains are keeping them down

Not many people live out there but a low unemployment rate between energy and farmers.

[Hugin]

31. Yeah, it seems pretty typical for low population density areas to have low unemployment.

I suppose they should correct for that somehow.

There's a couple of counties on the map I know for a fact aren't even populated.

[DemReadingDU]

43. Alaska?

How many people live in Alaska? It appears Alaska has 10% unemployment is some areas?

[Hugin]

51. I was looking more at the Mountain West.

Alaska has an odd block there at the top. I wonder who is responsible for collecting/reporting the stats used. It would seem by reporting a higher unemployment rate there might be an avenue for a State to get more Federal Aid... Unemployment to No-Where? A Stevens legacy?

[Demeter]

29. In Other Words, Wherever There Are People Living

[Demeter]

30. All 50 states in recession for first time since 1970s

http://www.marketwatch.com/news/story/all-50-states-recession-first/story.aspx?guid={0AD71800-BFB7-468A-859E-81D3A91207D2}&siteid=yahoomy

THIS IS WHERE I CAME INTO THE ECONOMY---HELLO AGAIN, 1973!



WASHINGTON (MarketWatch) -- The great recession of 2008 and 2009 is likely to be not only the longest downturn since World War II, but also the most geographically widespread recession since at least the 1970s.

For the first time on record, all 50 states were contracting at the same time, according to the state coincident indicators for February released by the Federal Reserve Bank of Philadelphia on Tuesday. The state-by-state indicators have been tracked by economists at the bank since 1979.
The indicators are designed to closely track gross state product in each state. The GSP data are available only with a long delay, with the most recent data covering 2007.

At least one state had been growing in every month for the past 30 years, until February. In January, the index showed Louisiana was growing and the other 49 states not.
A year ago, the index showed growth in 21 states. The last time all 50 states were growing was December 2006.

Prior to this recession, the most widely dispersed downturn on record was the 1982 recession in which 43 states were simultaneously contracting.

The index is one of the few economic indicators available on a state-by-state basis without a long lag. It's based on four timely employment indicators: nonfarm payroll employment, average hours worked in manufacturing, the unemployment rate and real wages and salaries (that is, adjusted for inflation).

[Demeter]

32. US commercial banks lost $9.2bn on derivatives trades in Q4 08

http://ftalphaville.ft.com/blog/2009/03/27/54136/us-commercial-banks-lost-92bn-on-derivatives-trades-in-q4-08/

The Office of the Comptroller of the Currency is an under-remarked institution, given its mandate:

The Office of the Comptroller of the Currency (OCC) charters, regulates, and supervises all national banks. It also supervises the federal branches and agencies of foreign banks. Headquartered in Washington, D.C., the OCC has four district offices plus an office in London to supervise the international activities of national banks.

The OCC also produces useful quarterly reports on the trading and derivatives activities of the banks it supervises - like this one, released on Friday, which details just how poorly commercial banks fared in the fourth quarter of last year:

U.S. commercial banks lost $9.2 billion trading in cash and derivative instruments in the fourth quarter of 2008 and for the year they reported trading losses of $836 million. The poor results in 2008 reflect continued turmoil in financial markets, particularly for credit instruments.

Other interesting factoids from the report include (emphasis FT Alphaville’s):
The notional value of derivatives held by U.S. commercial banks increased $24.5 trillion in the fourth quarter, or 14%, to $200.4 trillion, due to the migration of investment bank derivatives business into the commercial banking system

Derivative contracts remain concentrated in interest rate products, which comprise 82 per cent of total derivative notional values. The notional value of credit derivative contracts decreased by 2% during the quarter to $15.9 trillion. Credit default swaps are 98% of total credit derivatives.

Derivatives activity in the U.S. banking system is dominated by a small group of large financial institutions. Five large commercial banks represent 96% of the total industry notional amount and 81% of industry net current credit exposure

Foreign exchange trading revenues rose 32% to a record $4,093 million. Foreign exchange contracts continue to provide the most consistent source of trading revenues.

Credit trading continues to drive trading losses, as banks lost $9.0 billion in the fourth quarter, compared to $2.5 billion in third quarter gains. Banks had record losses trading both interest rate and equity contracts, losing $3,420 million and $1,229 million respectively.

Revenues from commodity trading activities fell 1% to $338 million.

There is also fascinating detail on credit risk and net current credit exposure, which increased by $364bn - or 84 per cent - in the fourth quarter to a record $800bn. Note, however, that gross credit exposure declined by almost 90 per cent from $7,100bn due to bilateral netting agreements.

OCC chart of credit exposure of US commercial banks

There’s quite a lot of chart porn in the report for those of you so inclined, but FT Alphaville thinks one of the best bits of the report is table one on page 22, which shows the notional amount of derivative contracts held by the top 24 commercial banks and trust companies as of Dec 31 2008, in $m.
And the top five, ranked by total derivatives, are:

JP Morgan Chase Bank NA - $87,362,762
Bank of America NA- $38,304,564
Citibank National ASSN - $31,887,869
Goldman Sachs Bank USA - $30,229,614

The fifth-ranked bank, HSBC Bank USA National ASSN, clocks in with a comparatively minor $3,713,075.

When ranked by holding companies, the ranking is as follows:

JP Morgan Chase & Co - $87,780,914
Bank of America Corporation - $39,081,848
Citigroup Inc - $33,424,365
Wells Fargo & Company - $$5,105,850
HSBC North America Holdings Inc - $3,660,305

[Demeter]

33. Follow the Bailout Cash

http://www.newsweek.com/id/190363


Michael Isikoff and Dina Fine Maron
NEWSWEEK
From the magazine issue dated Mar 30, 2009

There was plenty of outrage on Capitol Hill last week over the executive bonuses paid out by AIG after getting federal bailout money. But another money trail could make voters just as angry: the campaign dollars to members of Congress from banks and firms that have received billions via the Troubled Asset Relief Program.

A NEWSWEEK review of recent filings with the Federal Election Commission found that the political action committees of five big TARP recipients doled out $85,300 to members in the first two months of this year—with most of the cash going to those who serves on committees who oversee the TARP program. Among them: Bank of America (which got $15 billion in bailout money) sent out $24,500 in the first two months of 2009, including $1,500 to House Majority Leader Steny Hoyer and another $15,000 to members of the House and Senate banking panels. Citigroup ($25 billion) dished out $29,620, including $2,500 to House GOP Whip Eric Cantor, who also got $10,000 from UBS which, while not a TARP recipient, got $5 billion in bailout funds as an AIG "counterparty." "This certainly appears to be a case of TARP funds being recycled into campaign contributions," says Brett Kappel, a D.C. lawyer who tracks donations. (A spokesman for Cantor did not respond to requests for comment. A spokeswoman for Hoyer said it's his "policy to accept legal contributions.")

The cash flow is already causing angst inside the Beltway. "The last thing I want to do is wake up one morning and see our PAC check being burned on C-Span," said one bank lobbyist, who asked not to be identified because of the issue's sensitivity. House Speaker Nancy Pelosi and House Financial Services chair Rep. Barney Frank both said recently they won't take donations from TARP recipients. But House Democratic fundraisers have quietly passed the word that the party's campaign committee will resume accepting them—down the road, though; not right now. Said one fundraiser, who also requested anonymity, "These are treacherous waters."
URL: http://www.newsweek.com/id/190363

[Demeter]

34. Auto Company Plans Rejected by Task Force

http://www.nakedcapitalism.com/2009/03/auto-company-plans-rejected-by-task.html


Oh, so there was even more to the GM Wagoner resignation than met the eye.

So how come no bank turnaround plans? Oh, if they were no good, the government might have to get tough with them. Can't have that, now can we?

From CNBC (hat tip reader Dwight):

The announcement by the White House autos panel headed by former investment banker Steve Rattner marked a stunning reversal for management at both automakers and for GM investors and creditors who had bet on a softer line.

"We have unfortunately concluded that neither plan submitted by either company represents viability and therefore does not warrant the substantial additional investments that they requested," said a senior administration official, who asked not to be named.....

The White House says neither GM nor Chrysler submitted acceptable plans to receive more bailout money, setting the stage for a crisis in Detroit and putting in motion what could be the final two months of two American auto giants.

President Barack Obama and his top advisers have determined that neither company is viable and that taxpayers will not spend untold billions more to keep the pair of automakers open forever.

In a last-ditch effort, the administration gave each company a brief deadline to try one last time to convince Washington it is worth saving, said senior administration officials who spoke on the condition of anonymity to more bluntly discuss the decision.

Obama was set to make the announcement at 11 a.m. ET Monday in the White House's foyer.


From Bloomberg:

General Motors Corp. and Chrysler LLC must overhaul their recovery plans with deeper concessions to justify further taxpayer aid, and bankruptcy may ultimately be their best chance, an Obama administration official said....

Detroit-based GM sought as much as $16.6 billion in additional aid after receiving $13.4 billion since December. Chrysler sought $5 billion after receiving $4 billion. Both had to show progress by the end of this month in matters such as GM’s need to reduce unsecured debt by two-thirds.

Neither company completed the tasks, the administration official said. The aid plans submitted to the government Feb. 17 don’t warrant additional assistance, the administration concluded. GM’s plan to cut unsecured debt by two-thirds wasn’t sufficient, and Chrysler’s debt was far beyond what the company could sustain, the official said.

GM’s plan wouldn’t lead to success even in an improved economy, the administration found. The new strategy sought by the administration would focus on sustainable profit and significant changes in brands, workforce, nameplates and the retail network.


It would be better if we were wrong, but we are of the school that putting the big automakers into bankruptcy, despite its attractions (being able to restructure debt and dealer networks; the UAW contracts are far less significant economically than the media makes them out to be) misses out on one crucial element: you don't have a business if you don't have customers. And a GM bankruptcy would be a protracted affair. Even if consumers believe the company will make it, what about their local dealer? If they worry they might have to schlepp to get their car serviced, is it worth it?

In typical backwards American deal and contract focused thinking, the officialdom has not spent enough time assessing the single most important issue: how would customers react? If GM and Chrysler were to lose as many as 20% of sales they'd otherwise get as a result of a bankruptcy filing, that it is a very big change in outcomes. And the drop could be considerably higher than that.

I worry that this punitive move will wind up being Lehman redux. Recall that bailout disgust was running high post Bear and Fannie and Freddie, and Someone Had to Suffer to show the Administration was made of real men. Now since no one even dares bitch slap a bank (the bonus stuff is mere Punch and Judy), all the hostility is channeled at Big Auto. And the danger is going into overkill literally, not just figuratively, to make up for being too easy on the financiers.

And if GM or Chrysler were to be liquidated, the knock-on effects would be grim. They are important to quite a few parts suppliers. If those suppliers fail, it threatens the viability of the foreign transplants.

The markets appear to share these reservations. The Nikkei had been down, but has fallen further, S&P futures declined from 10 points down to 13 points down, and Treasuries have strengthened from their earlier in the evening levels.

[tclambert]

45. The new plan, just unveiled:

Baseball, hot dogs, apple pie, and Chinese Chery automobiles.

[antigop]

35. WSJ editorial: Treasury's Very Private Asset Fund

http://online.wsj.com/article/SB123854120033275659.html

The Obama Administration insists it wants to "partner" with private investors for its new toxic-asset purchase plan. But the more details that emerge, the more it seems Treasury wants to work with only a select few companies. This is no way to conduct a bank clean-up.

The investment community was already suspicious last week when Secretary Timothy Geithner unveiled his plan, announcing that Treasury would select four or five companies as "fund managers" to purchase toxic securities. Given that the whole idea is to create a liquid market for these assets, we'd have thought Treasury would encourage as many players as possible.

But the bigger shock was when Treasury released its application to become a fund manager, a main rule of which is that only firms that already have a minimum of $10 billion in toxic securities under management can apply. Few hedge funds, private equity players or sovereign wealth funds come near this number. The hurdle would bar many who specialize in the very distressed assets that the Obama Administration is trying to offload from banks.

I guess the WSJ editorial board doesn't like the plan either.

[Demeter]

36. Mr. Taleb Goes to Washington

http://www.thebigmoney.com/articles/judgments/2009/03/26/mr-taleb-goes-washington?page=0,0



...For Taleb, along with that other Grand Guignol figure of the economic collapse, Nouriel Roubini, being right has meant sudden access to an elite that used to ignore him. It's hard to think of a more establishment figure than Alan Murray, the executive editor for the Wall Street Journal online. Murray is also the man who interviews the CEOs, politicians, and other worthies onstage when the Journal holds a conference. That makes him the public face of the Journal among the corporate elite.

In normal times, the conferencariat are an arrogant bunch. This is something Murray knows well from his travels on the conference circuit, which begins each year with the World Economic Forum in Davos. "Davos is usually filled with people who have all the answers," Murray says. "What was so striking about Davos this year was all these people, for once, didn't have all the answers. No one could tell you with certainty what was happening or what needed to be done."

No one but Nassim Taleb. Before Davos, Murray read The Black Swan. At the conference, the newspaperman and the trader had many conversations over the course of four days. Murray came to the conclusion that Taleb was the iconic figure of Davos in 2009. "In my mind, he had the perfect message for the moment."

So Murray invited Taleb to the Future of Finance Conference, where 100 grandees of the financial world, ranging from Steve Schwarzman and George Soros to Meredith Whitney, Peter Fisher, and Nobel laureate Myron Scholes, got together to outline some principles for rebuilding the financial system. The conference opened with Murray interviewing Treasury Secretary Tim Geithner fresh from his 497-point victory lap after the announcement of his plan to deal with the toxic mortgage-backed assets. It closed with a field trip to the White House and an audience with Lawrence Summers.

Nassim Taleb turned down the chance to kiss Summers' ring. He left after dinner the first night. While the 130-person conference debated the government's new regulations that George Soros described as merely "tinkering" with the system, Taleb has a clear-eyed plan.....

[tclambert]

47. I saw Nassim Taleb in an interview on the TeeVee.

He sounded pretty sensible. He compared the investment banking business to the restaurant business, unfavorably. The banks were too big to fail, yet flirted with the risk of failure on a large scale, creating a fragility in that entire industry. Restaurants, he pointed out, fail all the time, but on a much smaller scale. And the result? "You can always find a place to eat." All those tiny restaurants create a robust network that cannot fail as a whole.

Myself, I would have used the internet as the analogy. Its robustness lies in the nature of a widely distributed network. You can lose thousands of nodes and it would still function. The massive parallel redundancy makes it extremely resilient. You do still have to watch out for critical bottlenecks, pieces that are too big to fail. There was a case where an undersea cable got cut and it knocked out internet service to millions of people.

One simple conclusion from this is that to protect our financial future, we MUST break up the big banks and AIG. We need to put a cap on how big a bank or other financial institution can grow, and split them up into smaller, safer entities.

[Demeter]

38. LET IT DIE by Douglas Rushkoff

http://www.arthurmag.com/2009/03/16/let-it-die-rushkoff-on-the-economy/



With any luck, the economy will never recover.

In a perfect world, the stock market would decline another 70 or 80 percent along with the shuttering of about that fraction of our nation’s banks. Yes, unemployment would rise as hundreds of thousands of formerly well-paid brokers and bankers lost their jobs; but at least they would no longer be extracting wealth at our expense. They would need to be fed, but that would be a lot cheaper than keeping them in the luxurious conditions they’re enjoying now. Even Bernie Madoff costs us less in jail than he does on Park Avenue.

Alas, I’m not being sarcastic. If you had spent the last decade, as I have, reviewing the way a centralized economic plan ravaged the real world over the past 500 years, you would appreciate the current financial meltdown for what it is: a comeuppance. This is the sound of the other shoe dropping; it’s what happens when the chickens come home to roost; it’s justice, equilibrium reasserting itself, and ultimately a good thing.

I started writing a book three years ago through which I hoped to help people see the artificial and ultimately dehumanizing landscape of corporatism on which we conduct so much of our lives. It’s not just that I saw the downturn coming—it’s that I feared it wouldn’t come quickly or clearly enough to help us wake up from the self-destructive fantasy of an eternally expanding economic frontier. The planet, and its people, were being taxed beyond their capacity to produce. Try arguing that to a banker whose livelihood is based on perpetuating that illusion, or to people whose retirement incomes depend on just one more generation falling for the scam. It’s like arguing to Brooklyn’s latest crop of brownstone buyers that they’ve invested in real estate at the very moment the whole market is about to tank. (I did; it wasn’t pretty.)

Now that the scheme we have mistaken for the real economy is collapsing under its own weight, however, it’s a whole lot easier to make these arguments. And, if anything, it’s even more important for us to come to grips with the fact that the system in peril is not a natural one, or even one that we should be attempting to revive and restore. The thing that is dying—the corporatized model of commerce—has not, nor has it ever been, supportive of the real economy. It wasn’t meant to be. And before we start lamenting its demise or, worse, spending good money after bad to resuscitate it, we had better understand what it was for, how it nearly sucked us all dry, and why we should put it out of our misery.

Chartered Corporations

Back in the good ol’ days—I mean as far back as the late middle ages—people just did business with each other. As traveling got easier and people got access to new resources and markets, a middle class of merchants and small businesspeople started to get wealthy. So wealthy that they threatened the power of the aristocracy. Monarchs needed to come up with a way to stabilize their own wealth before the free market unseated them.

They invented the corporate charter. By granting an exclusive charter, a king could give one of his friends in the merchant class monopoly control over a region or sector. In exchange, he’d get shares in the company. So the businessperson no longer had to worry about competition—his position at the top of the business hierarchy was locked in place, by law. And the monarch never had to worry about losing his authority; businesses with crown-guaranteed charters tend to support the crown.

But this changed the shape of business fundamentally. Instead of thriving on innovation and progress, corporate monopolies simply sought to extract wealth from the regions they controlled. They didn’t need to compete, anymore, so they just sucked resources from places and people. Meanwhile, people living and working in the real world lost the ability to generate value by or for themselves.

MORE DETAILS AT LINK

The current financial crisis is the best opportunity we have had in a very long time for a bloodless revolution against the faceless fascism under which we have been living, unaware, for much too long. Let us seize the day.

(UPDATE: “Hack Money, Hack Banking” by Douglas Rushkoff, the March 20 follow-up to “Let It Die,” is available here.)

[Demeter]

40. A Brief History Of AIG's Three-Decade Duty Free Bermudan Adventure

http://tpmmuckraker.talkingpointsmemo.com/2009/03/yesterday_we_noticed_the_focus.php?ref=m1

By Moe Tkacik - March 31, 2009, 3:27PM

Yesterday we noticed the focus of the Case Against AIG And The Reckless Executives Inhaling Our Money had begun to shift from the exotic, futuristic sounding world of synthetic credit derivatives to the Old Economy business of dodging taxes. In fact, the two are inextricably intertwined -- AIG FP was by far the biggest underwriter of the inscrutable options that could generate the kind of phony capital gains losses that rich people and companies use to get out of paying taxes. To really understand what Cassano and his gang were up to, it helps to have a working knowledge of the company's history of run-ins with the IRS. Again and again AIG has been involved in schemes the IRS has deemed illegal, forcing the insurer and its clients to cough up some billions of dollars in back taxes over the past decade. The only real factor obscuring the magnitude of the malfeasance at AIG was arguably the many hundreds of banks, corporations and individuals who played along.

UPS: The platonic "ideal" tax structure

AIG has been a go-to source for IRS shortchanging expertise at least since 1983, when it helped UPS form a Bermuda "reinsurance" subsidiary in 1983 to divert certain "excess value" charges into an ingenious tax haven from which the IRS, following a five year legal battle eventually recovered $1.44 billion of $2.3 billion in uncollected taxes. After the jaw-dropping penalty was announced, the insurance trade journal National Underwriter quoted KPMG partner Mark Anderson saying he still looked to AIG's UPS tax haven as an "ideal" when structuring his own clients' tax havens.

KPMG: The accounting industry folds

But the taxman came for KPMG next, after discovering the firm had peddled tax shelter schemes -- a few of which came bundled with liability "insurance" to protect the tax benefits from AIG FP -- to hundreds of companies, including the baseball card manufacturer Upper Deck, which ended up suing AIG after coughing up almost a hundred million dollars in taxes after KPMG coughed up its client list as part of a half billion dollar plea agreement. Seventeen ex-KPMG executives were indicted in the "S2" tax shelter case, which was prosecuted in the aftermath of accounting scandals that nearly decimated all the industry's entrenched players. They didn't decimate AIG, however, which refused to make good on Upper Deck's insurance.

What Happens To A Prosecution Deferred...

Shortly thereafter AIG FP's inimitable chief Joseph Cassano was charged in assisting PNC Financial in a similar fraud, though the three firms avoided formal criminal indictments by coughing up fees in deferred-prosecution agreements that in AIG's case anyway, meant the company was required to pay a government-appointed attorney to report on the company's operations.

It sure seemed like that lawyer, James Cole, missed big-time with AIG -- but the IRS effectively banned foreign tax credit generators like the ones in which AIG specialized in 2007, and Cole's primary mission was to go back and scour the company's practices between 2000 and 2005, years during which AIG FP's haven-structure subsidiary the Transactions Development Group had been involved with countless other such deals, including the Hewlett-Packard vehicle the Wall Street Journal reported yesterday had generated the firm $132 million in bogus tax credits.

Son of Bosses And Fake Tax Losses

Meanwhile the IRS is still waging a decade-long battle with the so-called Son Of Boss tax shelters that have employed unregulated derivatives of the sort sold by AIG to generate more than six billion dollars in phony capital losses. The IRS has recovered more than three billion dollars in losses since offering amnesty to taxpayers who voluntarily cough up funds, but other investors have tied up courts with dubious claims that their shelters serve actual economic or business purposes. Last month a Los Angeles judge ruled another $145 million Son of Boss shelter illegitimate.

Which is to say, perhaps Cole and other federal watchdogs had their work cut out for them simply rooting out all the different loopholes AIG used to hide from the IRS -- and the "systemic risk" flew over their heads.

[antigop]

49. August 11, 2000: Treasury shuts down "Son of Boss" abusive tax shelter

http://treas.gov/press/releases/ls831.htm

The Treasury Department and the Internal Revenue Service on Friday issued a notice to shut down another abusive tax shelter that is being marketed and sold. This new scheme is similar in design to the so-called Bond and Option Sales Strategy, or BOSS tax shelter, which the Treasury and IRS shut down last December with Notice 99-59.

"Despite these steps, the use of abusive tax schemes will continue to unfairly raise the tax burden on the American people," Treasury Secretary Lawrence H. Summers said. "Until we have an overall legislative solution in place, we are sure to see further generations of this and other abusive tax shelters."

As in the BOSS shelter, this new scheme uses a series of contrived steps (in this case involving interests in a partnership) to generate artificial tax losses designed to offset income from other transactions. Notice 2000-44 issued today would deny taxpayers the purported losses resulting from this shelter transaction because they do not represent bona fide losses reflecting actual economic consequences as required under the tax law. The notice informs taxpayers and promoters that appropriate penalties may be imposed on participants in these transactions. The notice also warns that taxpayers and promoters who participate in these transactions and willfully conceal their efforts on tax returns may be subject to criminal penalties.

Treasury Secretary Larry Summers --August, 2000

Small world, eh?

[Tansy_Gold]

52. Yeah, haven't we heard that name more recently?

:puke:

[DemReadingDU]

42. Hoarding up for the apocalypse

3/24/09 The rich prepare for the apocalypse
CEOs' desire for even more wealth a preparation for end-times luxury
Dan Rodricks

Hoarding for the apocalypse calls for belief that the end is coming and that wealth will insulate the wealthy from the misery that will befall the rest of us. (The rest of us might harbor apocalyptic fears, from time to time, but we haven't figured out what to do about them. We're wage-earners, for the most part, or the owners of small businesses. We haven't all that much to hoard - not enough to make a difference, anyway - so we keep working to keep the bills paid and the kids fed.)

The apocalyptic rich have hoarded cash and assets - and they continue to accumulate as much as possible - and they've built retreats to allay a deep fear that, when the world starts to fall apart, they will be at the top of a mountain, in a secure compound with its own source of energy and potable water (and a decade's supply of cabernet), isolated from the screaming, rioting masses.

As the world's population grows, as the recession expands and unemployment worsens, as the globe continues to warm and the oceans rise, as questions about the future of energy and natural resources become graver, as civil unrest becomes a greater concern, the masters of the universe grab all they can. It's an Idaho panhandle mentality on Wall Street - hoard money and assets, and enough golf balls to ride out the coming cataclysm. There's social Darwinism at play in this, to be sure - survival of the richest - but it's the most cynical and self-centered kind, based not on enterprise or capitalism, but on a dark view of the future. Their concept of the greater good is gone, and they certainly display nothing you might call civic-mindedness or patriotism.

Of course, the cynics always existed among us, but they've grown in number in recent years, and they have more power and influence than ever. Those who work in financial markets and deal in commodities, those who watch global trends in energy and food production and population growth - those who have seen the numbers - I believe they have become gravely pessimistic about what life on Earth in the next quarter-century will become, and that's what drives them.

Certainly they would not say these things publicly, and they will dismiss my two-bit theory as two-bit pop psychology. But I think there's something to this. Why else would they keep buying and upgrading their private jets? The day will come when they need to make a quick escape to their mountain retreats, leaving the rest of us suckers on the ground.
http://www.baltimoresun.com/news/local/bal-md.rodricks24.1mar24,0,6859525.column

[Tansy_Gold]

48. Interesting that this is in the Baltimore Sun and not some

weird ass blog post. Makes you kinda go hmmmmmmmmmmmmmmmm.



Tansy hmmmmmmmmmmmm Gold

[Wednesdays]

53. For some reason, I get this image in my mind

[Tansy_Gold]

54. Or. . . .

[DemReadingDU]

56. That's more what I was thinking

The wealthy have surrounded their McMansions with moats and tall fences/walls that are topped with barbed wire. And they have huge solar panels and wind turbines to generate electricity. I suppose a big garden and livestock for food, and a well for water. And guns.

[Demeter]

61. Nah, More Likely They Are Surrounded by Hedge Funds

The people you describe are more like survivors.

[UpInArms]

55. Thornburg Mortgage to file bankruptcy, close down

http://www.reuters.com/article/bondsNews/idUSN0148490920090401

NEW YORK, April 1 (Reuters) - Thornburg Mortgage Inc (THMR.PK) said it plans to file for Chapter 11 bankruptcy protection and go out of business, making the provider of "jumbo" mortgage loans one of the largest casualties of the nation's housing slump and credit crisis.

The Santa Fe, New Mexico-based company had specialized in making mortgages larger than $417,000 to borrowers with good credit. Thornburg has struggled with liquidity problems since the summer of 2007, when the value of mortgages on its balance sheet began to fall, and later suffered a series of margin calls from its creditors.

"It was caught up in the credit crisis like everyone else," said Christine Myatt, a partner and bankruptcy specialist at the law firm Nexsen Pruet in Greensboro, North Carolina. "It is better to go through Chapter 11 liquidation rater than Chapter 7 because it allows asset sales over a period of time rather than a forced sale right now."

Thornburg said creditors including Citigroup Inc (C.N), Credit Suisse Group AG (CSGN.VX), JPMorgan Chase & Co (JPM.N), Royal Bank of Scotland Group Plc (RBS.L) and UBS AG (UBSN.VX) plan this month to seize and sell their collateral, using proceeds to reduce amounts Thornburg owes. The company said it also plans to transfer its mortgage servicing rights to these creditors.

In addition, Thornburg intends to sell its other assets, with the help of the restructuring firm Houlihan Lokey Howard & Zukin Capital Inc. It will also not make an interest payment due March 31 on senior subordinated notes maturing in 2015.

"Our dissolution was created by one issue, the inability to support the equity (margin) requirements for financing our mortgage securities portfolio, given the continued decline in mortgage-backed securities prices," Chief Executive Larry Goldstone said in a statement.

In a November regulatory filing, Thornburg said it lost $2.75 billion, or $85.71 per share, in the first nine months of 2008. It ended September with $25.4 billion of adjustable-rate mortgage assets on its balance sheet.

...more...

[specimenfred1984]

59. Any reasons why this market is up other than fascism and manipulation?

The economic news is horrible today, so that explains the fascism angle and every single day in our Prava-like propaganda press explains the manipulation but just WTF are the BSers that run our financial system trying to pawn off as bullish news today?

[UpInArms]

60. the good news of car sales dropping like a rock and all the

jobs evaporating is always good news for investors!

hush up now and get in line for your increased to half the size chocolate ration

signed,

nurse ratchet

[Robbien]

66. Mark to market is being killed off. Mark to banksters best judgement is being

voted in on Thursday. Or that's the word which was "leaked" this morning.

Wall Streeters are giddy with glee.

[tclambert]

62. Automakers post steep US sales drops for March

DETROIT (AP) -- March proved to be another dismal month of steep declines for U.S. auto sales, as low consumer confidence and job uncertainty kept buyers away from showrooms.

General Motors Corp. led the slide with a 45 percent U.S. sales plunge compared with a year earlier, while Ford Motor Co. reported a 41 percent drop. Sales at Toyota Motor Co. and Chrysler LLC both dropped 39 percent, while Honda Motor Co. reported a 36 percent decline.

Detroit-based GM sold a total of 155,334 light vehicles, while Ford sold a total of 131,102. Ford's total came in slightly below that of Toyota, which reported U.S. sales of 132,802 units.

Despite the declines, GM, Ford and Toyota all posted double-digit improvements from February, when the U.S. sales overall hit their lowest point in more than 27 years.

http://finance.yahoo.com/news/Automakers-post-steep-US-apf-14817908.html?sec=topStories&pos=1&asset=TBD&ccode=TBD

-----

So, car sales were horrible, but slightly less horrible than last month, and that equals improvement and the market as a whole goes up? GM stock is down, Ford and Toyota are up. Three quarters of a million Americans lost their jobs in March. DJIA up about 840 in March.

"When logic and proportion
Have fallen sloppy dead,
And the white knight is talking backwards
And the red queen's 'Off with her head!'
Remember what the dormouse said:
'Feed your head.
Feed your head.'

http://www.youtube.com/watch?v=Quhj6PEboCU

[antigop]

65. Harvard derivatives whiz fired for emailing Larry Summers about "frightening" trades?

http://tpmmuckraker.talkingpointsmemo.com/2009/04/larry_summers_ignored_frightening_trading_practice.php

A former quantitative analyst at Harvard Management Company, the university's once-vaunted endowment manager, tells the Harvard Crimson she was fired for voicing concern to then-university president Larry Summers' chief of staff about the money manager's risky use of derivatives the traders didn't understand.

The episode dates back to 2002, when analyst Iris Mack, whose website identifies her as the second African American woman to earn a Harvard PhD. in applied math (and someone who likes primary colors) joined the much-venerated Harvard Management Company, which invests the university's then $18 billion endowment, to find what she termed a "frightening" state of affairs.

"The group I was working for had no background whatsoever to be working on ," Mack says, adding that, to her knowledge, several of her colleagues were not licensed securities traders. "Sometimes the ways they handled even basic Black-Scholes models were puzzling."

So Mack took inventory of the abuses -- high employee turnover, lax risk management practices and a "low level of productivity in the workplace" were among others, and detailed them in an email to Marne Levine, Summers' chief of staff and a Treasury staffer on the Obama Transition Team. (Summers was the only person to whom Meyers reported, and according to a recent Forbes story he personally ordered the university's biggest derivatives trade, a purchase of interest rate swaps that cost the university billions this year.)

Harvard: The Inside Story of its Finance Meltdown:
http://www.forbes.com/forbes/2009/0316/080_harvard_finance_meltdown.html

The superstars at Harvard defied markets for years-- until now. Here's the inside story of how they finally tripped up.

Stocks were tumbling last fall as the new school year began, but at Harvard University it was as if the boom had never ended. Workers were digging across the river from Harvard's Cambridge, Mass. home, the start of a grand expansion that was to eventually almost double the size of the university. Budgets were plump, and students from middle-class families were getting big tuition breaks under an ambitious new financial aid program. The lavish spending was made possible by the earnings from Harvard's $36.9 billion endowment, the world's largest. That pot was supposed to be good for $1.4 billion in annual earnings.

Behind the scenes, though, a different story was unfolding. In a glassed-walled conference room overlooking downtown Boston, traders at Harvard Management Co., the subsidiary that invests the school's money, were fielding questions from their new boss, Jane Mendillo, about exotic financial instruments that were suddenly backfiring. Harvard had derivatives that gave it exposure to $7.2 billion in commodities and foreign stocks. With prices of both crashing, the university was getting margin calls--demands from counterparties (among them, jpmorgan Chase and Goldman Sachs (nyse: GS - news - people )) for more collateral. Another bunch of derivatives burdened Harvard with a multibillion-dollar bet on interest rates that went against it.

It would have been nice to have cash on hand to meet margin calls, but Harvard had next to none. That was because these supremely self-confident money managers were more than fully invested. As of June 30 they had, thanks to the fancy derivatives, a 105% long position in risky assets. The effect is akin to putting every last dollar of your portfolio to work and then borrowing another 5% to buy more stocks.

[Tansy_Gold]

68. Larry Summers? Larry Summers? That name seems familiar. . .

. . . . . .


:puke:

[Robbien]

67. CNBC David Faber: Well Of Course AIG Is Being Used To Loot Taxpayers

During one of his segments this morning, David Faber decided to address a "blogosphere" rumor about AIG being the root cause of the bank's profitability in Q1. He was referring to this -- the allegation that AIG is unwinding its trades in a manner extremely generous to bank counterparties.

Faber's response: "Wish we'd mentioned that earlier, we certainly knew it."

http://www.businessinsider.com/david-faber-well-of-course-aig-is-being-used-to-loot-taxpayers-2009-4

[DemReadingDU]

69. "blogosphere" rumor

RUMOR!

:wtf:

[TheWatcher]

70. End OF Day Commentary: This Is Not America

Greetings Marketers. I have returned. :)

The time away from DU and The News Of The World did me some good. I popped in for a quick post around The Gulag (which is anything outside of SMW nowadays) a couple of times, but for the most part obeyed my partner's wishes and did a little soul cleansing.

And believe me, this guy helps in that department. A LOT.

Meet Mao:



Two handfuls long, and full of more energy than anything you've ever seen. He is truly a Blessing on This House. :)

We had a wonderful weekend down in Portland at The Vampire Masquerade Ball (Yes, we are those scary "Goth Types" who listen to Siouxie and Bauhaus and drink your children's blood when you are not looking) :), and we really got a sense of renewal being with all of our friends from Seattle and across the country. Portland is a beautiful place, and I fall in love with it every time I go there. I keep threatening to relocate there, and if enough of our friends do the Exodus from The Emerald City, we just might. :)

And now unfortunately we must turn our eyes to the Burgeoning Asylum that is quickly becoming the USSA.

As fred commented earlier, what possible justification could there be for today's silly rally (much less yesterday's.)

Well, let's hear it from Pravda itself shall we?

Wall Street climbs as data boosts sentiment

NEW YORK (Reuters) - Stocks extended gains on Wednesday after factory and home sales data further

Shares of big manufacturer Caterpillar Inc (NYSE:CAT - News) led the Dow higher after data showed factory activity in March fell at a slower rate than the month before. Home builders (DJI:^DJUSHB - News) also gained after pending sales of existing homes rose in February.

Wall Street begins 2nd quarter slightly higher

NEW YORK (AP) -- Wall Street began the second quarter on solid footing Wednesday as better-than-expected economic reports helped the market extend a four-week rally.

After falling in the early going on disappointing jobs data, the Dow Jones industrials ended with a gain of 153 points following reports showing a rebound in pending home sales and improving manufacturing activity. Other major indexes rose about 1.5 percent.

Financial stocks led the market higher, followed by big gains in the technology and energy sectors. As sentiment about the economy improves, investors have been buying up industries they believe are likely to lead the country out of recession.

The Dow charged ahead in March, rising 16 percent off of 12-year lows hit early in the month, but its movements over the first three months of the year have been among the most tumultuous on record. Only three other times in the Dow's history has it experienced 20 percent swings in both directions in one quarter.

More Rallying Of The Proles at the link.

http://finance.yahoo.com/news/Wall-Street-begins-2nd-apf-14820048.html?sec=topStories&pos=main&asset=TBD&ccode=TBD

I'm not going to recap the numbers and data that came out today, as it has already been well analyzed in the thread, but you simply have to see what's being written and reported and cheerleaded in the Media to believe it.

People, this is SOVIET LEVEL Propaganda. This is the kind of nonsense that used to happen in Russia back in the 70's and 80's. To see this kind of BS occurring on a daily basis now in our country is frightening beyond belief, and it should alert the thinking people who are left to a simple, terrifying fact.


I think after the past two days, those of us who are not continuing to suck on the Straws of our State Rationed Kool-Aid Boxes can now see that the ENTIRE RALLY in March was based exactly on what I and many of you tried to tell all the excited Sheep who thought it was time to go to Sizzler and start making weekly shopping trips to the Bon Marche again.

Fraud, Propaganda, and synthetic, nonsense programs designed to prop up the ESTABLISHMENT, which continues it's final endgame of wealth transference from the rest of us.

Let's think back to when the rally began on March 10th.

I'm sure we all remember the news and BS we were all fed intravenously that week.

"Pandit The Bandit's" memo about Citi being "profitable" in the first two months of the Quarter.

The other Banks following suit with their own Propaganda releases.

GM saying it was "profitable" again, and needed no more Government help, and that they were fine.

In fact, EVERYONE was saying they didn't need anymore help, and that they were all fine, and everyone was smiling and grinning and preening, and showering us with "hopes" and "assurances" that the recovery was here, and that all was well.

Fast forward to Monday of this week.

Goofy breaks it to the Proletariat that the Banks need "a lot more help" than even THEY think:

Geithner Says Some Banks Need ‘Large Amounts’ of Assistance

March 30 (Bloomberg) -- U.S. Treasury Secretary Timothy Geithner said some financial institutions will need substantial government aid, while warning against any attempt to tax investors who join a federal program to buy tainted assets from banks.

“Some banks are going to need some large amounts of assistance,” Geithner said yesterday on the ABC News program “This Week.” The terms of a $500 billion public-private program to aid banks “cannot change” for investors or they’ll lose confidence in the plan, he said on NBC’s “Meet the Press.”

The Obama administration is pursuing the most costly rescue of the U.S. financial system in history while facing taxpayer concerns the aid is bailing out Wall Street firms that took excessive risks. After allocating about 80 percent of $700 billion in aid approved by Congress, administration officials want to keep open the option of seeking more.

Geithner said the Treasury has about $135 billion left in a financial-stability fund while declining to say whether he will request additional money.

“If we get to that point, we’ll go to the Congress and make the strongest case possible and help them understand why this will be cheaper over the long run to move aggressively,” he told ABC News.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aG9S.k0EdC58&refer=home

But.....But.....GOOFY! I thought Pandit and Lewis and all of the other honest Banksters who are the pinnacle of honesty and are Of The Lord told us that all was well and everyone was profitable again.

You wouldn't LIE to us WOULD YOU? :eyes:

Now let's rewind once more to March 11th.

GM says they are "profitable" again, and won't need that $2 Billion they desperately needed to survive. (Actually it was $3 Billion, but what's a billion amongst friends when you are busy Propagandizing The Public.)

Now fast forward AGAIN to Monday.

GM CEO Wagoner forced out as part of gov't plan

DETROIT – Time and time again, General Motors Corp.'s board of directors reaffirmed its support for Chairman and CEO Rick Wagoner, even as the company piled up billions of dollars in losses and begged for government loans to stay alive.

But Wagoner is now a high-profile casualty of government intervention, forced out as part of the Obama administration's sweeping last-ditch effort to save the century-old auto giant.

http://news.yahoo.com/s/ap/20090330/ap_on_bi_ge/gm_wagoner

GM, Chrysler race deadlines to hold off bankruptcy

DETROIT – He doesn't know exactly what the Obama administration wants him to cut, but Fritz Henderson, the new CEO of General Motors Corp., isn't waiting around to find out. Cut deeper. Work harder. Move faster. That's how he described the ailing automakers urgent effort to meet a June 1 deadline to fix its debt-ridden balance sheet, cut billions in costs and take other steps to transform itself into a profitable entity.

It's the same government-imposed race that Chrysler LLC is running, only GM's smaller neighbor has to cover more distance in half the time.

The Auburn Hills, Mich., automaker must make the same cuts as GM, and sign up Fiat Group SpA as a partner, all in 30 days. Fiat's CEO jetted to Detroit for intense negotiations, but if Chrysler doesn't meet the deadline, it's almost certainly destined for the auction house.

For GM, failing to take quick action means surrendering to court supervision in bankruptcy. The company has resisted bankruptcy talk in the past, but Henderson said Tuesday it is now "certainly more probable."

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

But.....But....They said they were "profitable" again and did not need any further assistance!

They Wouldn't LIE to us would they? :eyes:

So after three weeks of Pravda like Preening by the Media, The White House, The Congress, The Treasury, and a 16% Meth Party Of Blatant Stupidity in the Stock Markets, The Truth finally comes out, as we all knew it would.

IT'S OVER.

There is no one coming to save us, there is no leadership that is going to fix the problems, and we are ON OUR OWN.

We have essentially been left to die by whatever circumstances are coming over the Horizon.

I do not say things like this to be overly dramatic or fear-monger.

If you are familiar with history, you can connect the dots and see where all of this is going.

There are NO SOLUTIONS to this Crisis, and the only thing we are going to see from TPTB, The Banks, The Corporations, and every other Pirate-Like Entity is the biggest voracious tangent of looting, robbing, and stealing in human history, as our economy and possibly our COUNTRY goes down by the head.

This is it. It has begun, and there is probably little that any of us can do to stop it, because let's face it, the majority of the country is going to cheer it on with thunderous applause and giddy approval the whole way down.

When I resumed my daily DU'ing, I was horrified to find out that this thread is now being referred to as a "fascist thread" by some on DU.

Now look, I realize the level of denial and goose-stepping has gotten to frightening levels, but this is beyond the Pale. However it was something I was worried about going forward.

The whole country has gone batshit insane, and our Sanctuary that has been DU for most of the way through the last dictatorship, is now showing signs of going Brown Shirt by a lot of members.

I'm not going to make any comparisons to history, because all of you have heard it all before. You KNOW what is coming down right now. You've SEEN this movie before.

Any logical and reasonable discussion of reality, whether it be economic, political, or even just GENERAL is being met with hostility, denial, and mob rule mentality.

And look, some of the most frightening news that has been coming out has NOT BEEN from a Conspiracy Blog or the PrisonPlanet Forums, it's RIGHT OUT IN THE OPEN from legitimate news sources.

Things are actually HAPPENING, and people are insisting it either doesn't exist, or it's all a "Right Wing Plot" to "Sabotage" The ONE.

Things are happening at such an accelerated rate, I can't even get to them all in this commentary and I'm not even going to try.

Because there comes a time, no matter how painful and difficult, that you MUST come to a level of acceptance and resignation to what is going on around you and realize the reality that is coming down the tracks.

Thus my advice to the Good, Awake, Sane people who Post here, and lurk here, who Get It:

1. Get your affairs in order, and GET OUT OF DEBT as quickly you can.

I can't stress this enough. DO. NOT. HAVE. DEBT.

2. Make sure you have adequate supplies (You know what they are and we have gone over it many times, so no elaboration is needed here, hopefully) and needs for your family, and make whatever preparations you need for what YOU think you need to prepare for.

If that includes making your Exodus from the USA, then you have my blessing, and the best, sincerest, hopeful wishes I can give you and your family. I am not going to judge those who feel the need to do this. Just make sure you have a PLAN, and plan everything out to the last detail. If you go in to Ex-Pat Status without one, then you are possibly dooming yourself to an even WORSE fate than if you had stayed here.

3. Pay Attention to what is going on, stay informed, but TAKE A BREAK when you need to. I got a very hard lesson in this recently, and I cannot begin to tell you how important it is that you keep the balance of staying on your game, and keeping your sanity.

Knowing The Truth will do you little good if you get consumed and broken down by it.

4. MAKE A PLAN. And be responsible and reasonable about any plans you make. Panic and Fear are not your friends, and they will serve no purpose but rash decisions and poor judgment. When making your plan, consider the circumstances and the environment you are in, and what you think you are going to need to prepare for. I'm not going to sugar coat this at all.

We DO NOT have REPRESENTATIVE GOVERNMENT

You are not going to be able to depend or rely on our so-called "leadership" to do anything in your interests, or offer any real solutions to the problems that are not only happening now, but will be happening in the next few months and years. They ARE NOT on YOUR SIDE, and they have made that clear to you. You are a means to an end, and nothing more. What most of us are going to have to do is learn how to adapt and survive in whatever environment we are presented with, because I don't foresee and actual Democracy returning to our country any time soon.

We all know what it would take for that to occur, and it ISN'T GOING TO HAPPEN. You know it, and I know it. That's just the way it is. We must not fear it or panic from it. We have to deal with it.

5. Those who are awake and informed, you need to COMMUNICATE with each other. Form communities and network with like minds, stay in touch, and take care of each other. The Goose-Steppers, Blind Faith Bunnies, and True Believers are NOT going come around, I am afraid. Surround yourself with like-minded people, stay informed, and help one another. It's the only way those of us who are going to stay here in country are going to make it. SELF-SUFFICIENCY and COMMUNITY are they keys to survival in times like these.

And I echo the above sentiment because of what AnneD mentioned the other day. If you know someone who posts here you trust, stay in touch with them. Network. She has the right idea, and I am glad she talked about it.

Now of course the Rose-Colored Brigade who lurks here is probably going to freak out when they read a Post like this, and think I am calling for some kind of formation of a Terrorist Group, I'm an Agent Provocateur, A Militia Nut, A Right Wing Plant, A Disruptor, Blah, Blah, Blah, Blah, Blah.

To them I say: At LONG Last, GO. FUCK. YOURSELVES.

GO Be Slaves. GO be Sheep. GO to the fate you so desperately have a fetish for. GO join the ranks of the fleeced, forgotten, and fooled.

I no longer have any sympathy for you. Just leave me, and anyone like me the fuck alone, get on with your false paradigms, your false hope, your blind worship, your Goose-Stepping for "The Football Team", and let us live our lives in peace. You are welcome to your fate and I won't stop you. But I'M NOT GOING DOWN WITH YOU.

As for those who are awake, I stand with you. Unapologetically and PROUDLY. And I will do what I can for who I can, and we WILL make it though the Storm.

And Make NO Mistake.

IT IS COMING.

A little piece of you
The little peace in me
Will die
For this is not america

Blossom falls to bloom
This season
Promise not to stare
Too long
For this is not a miracle

There was a time
A storm that blew so pure
For this could be the biggest sky
And I could have
The faintest idea

But This Is Not America.....

-David Bowie

[tclambert]

76. Finally some worthwhile investment advice from SMW:

Invest in kittens.

[TheWatcher]

77. Isn't he Dreamy? :)

Honestly, With him and Ghost Dogs Music Posts, you'll never need to worry about Hypertension. Ever. :)

[DemReadingDU]

78. the Good, Awake, Sane people

Hey, that's us SMW'ers. The best community!

Just curious, how many more tools do you think there are in their toolbox to keep delaying the inevitable? How much longer can they keep gambling with our money before it all implodes and crashes?


Love that pic of your new kitten!

[TheWatcher]

82. I really don't know for the life of me how they are doing it, DRDU

But I guess when you can Print infinitely, and most of what you are dealing with is mostly Electronic 1's and 0's generated by F12 keys, you can pretty much do whatever you want. :)

There is an old saying, and a lot of old and new timers will be familiar with it, if they have followed the Markets for some time:

"The Market Can Stay Irrational A Lot Longer Than You Can Stay Solvent."

I think the operating version of that right now is that The Criminals can levitate a lot longer than you can live, apparently.

One thing is for sure. THEY WANT IT ALL. They know what's coming, they have no plans to stop it, and they probably couldn't even if they wanted to, so the Superclass and the wealthy are hoarding, padding their assets, and stealing, looting, and robbing from the masses of what they have left, simply because they can.

The problem they don't seem to have a solution for yet is what to do when the rest of us finally get pissed off and decide to practice self-preservation.

If that happens, things could get out of control very quickly.

But that's a scenario that might not even happen in our lifetimes.

For now, the Ponzi Game can go one for however long it needs to.

They have too many people invested TOTALLY in a Cult Of Personality figure, who gives them the drug of Hope, which I hate to say, could turn out to be even more destructive than the last dictatorship's drug, which was fear.

What astounds me more than anything is the level of Propaganda that is going on. They took today's news, which was an indicator that things are actually getting WORSE, and somehow spun into "signs that the economic Crisis is stabilizing."

THAT is Soviet Stuff. THAT is Goebbels from 1930's Germany Stuff. THAT stuff is not supposed to happen in a country like ours, and it damn sure isn't supposed to be going on with reckless abandon with a Public that is zombie walking and nodding to it, unquestioning and not even challenging what they hear.

We are in a VERY dangerous situation.

As for the insanity of the Markets, I mean, a CHILD would know this is rigged. Right after the close the Futures IMMEDIATELY started deteriorating, and about an hour later, all of a sudden they are up over 100 Points in a half hour, PURELY BASED ON NOTHING.

We don't even have a functioning economic system right now. We are at the mercy of a mafioso that is going to have it's way until reality takes over at some point.

Which is why I posted the alert for preparedness.

You DO have time. I don't know how much, but there is time to do what you need to. I know it in my heart. And unless there is some kind of "incident", real or staged, that changes the environment immediately, it will be there.

Make the most of it, my friend.

As for the new kitten, he has been such a boon of happiness for us the past few days. :)

All of our friends want to steal him, and he has become quite the Rock Star in our scene of people.

I have to say, with all the red alert stuff I posted today, I DO feel a lot more cleansed and hopeful right now than I have in awhile. I just needed to center myself, and get back a little sanity so I could move forward.

Maybe tclambert is right.

We should all invest in Kittens.

Goddess Knows what it's done for us. :)

My Best to you and everyone who hangs on here. :)

[Dr.Phool]

80. Welcome back Watcher.

Sounds like the break did you good. I've just been popping in a little, the last week. I've had my Dad down here, trying to get him to move to a nice retirement community. I think he's going to agree. But, he's flying back in the morning, and I'll be posting a little more often.

You've touched on a lot of things that have been going through my mind lately. I've been running a post for my journal for a couple of weeks about the death of representative democracy, and what it means for us. Guaranteed, heads will explode.

I've been really thrilled the last couple of days to find out that I'm a fascist, and didn't know it. When I ran for Congress in 2004, as a progressive Democrat, I thought my republican slug opponent was the fascist. And that Dennis Kucinich guy had to be the biggest sucker in the world, when he offered to come to Florida to campaign for me. And I sure fooled John Kerry, and John Edwards, when they made me their County spokesperson. I won't even mention the congressional campaigns I've simultaneously co-managed and undermined.

I sat out 2008, because frankly, I didn't see any there, there. And I don't like what I'm seeing so far.

This is really the only sane place left around here.

Welcome back.

[TheWatcher]

83. Thank You, Good Doctor. :) It's Good To Be Back.

I couldn't just leave you guys to deal with the Zombies by yourselves, now could I? ;)

I must say I am VERY impressed by your resume and level of service you opined about.

This country NEEDS more people like YOU and Kucinich involved in the system and giving the people actual REPRESENTATION, Not EXPLOITATION. (You know, there is a T-Shirt or a Bumper Sticker idea in that sentence somewhere) :)

But I share your alarm at what is happening to people that we once stood hand in hand with against the Enemy that was the last dictatorship. it is very worrisome that people have literally invested EVERYTHING in one person as a savior for all their ills, when it is the SYSTEM ITSELF that is killing them.

If you don't treat the root cause, the Cancer will kill you if you have Jesus Christ in Office. it doesn't matter.

As for my own personal view, I think what TPTB have done is change the bird cage liner, unfortunately, and nothing more.

If you think back to just before Bush left office, it may not have seemed like it to those of us who left The Matrix a long time ago, but the natives WERE restless, and the Meadow WAS stirring. The whole world was about ready to erupt, and whispers of even the "R" word were starting to become more than whispers, and a lot more vocal.

Enter November 4th, 2008.

The mentality and the landscape LITERALLY changed overnight, not unlike the way the Planet Formation took shape at the end of Star Trek II when the Genesis Project activated on the Planet's surface. A whole new world emerged, and the world was awash in a euphoria of relief and hope that somehow a True Savior had arrived, and everything was going to be OK.

Now, just a little less than five months later, those with open eyes are beginning to see we MAY have been sold a Bill Of Goods. That all that really happened was that TPTB changed the Bird Cage Liner, and now the theme of Oppression and Tyranny is "Hope", instead of "Fear" the way it was the last time.

Look, O could be the best person that has ever lived and have the heart and disposition of Christ himself, but the problem is he has surrounded himself with the very same Jackals that got us into this mess to begin with, and his handlers are the same cloth of thugs that have been running this country into the ground for DECADES.

Meet the New Boss. He sure is prettier and a lot more intelligent than the Old Boss, but he might have the same Puppet Strings attached to his well-tailored suits.

There really isn't much we can do right now except sit back and watch the madness unfold, because it has not been long enough for people to even THINK about questioning "The Football Team."

It occurred to me the other day that I have not felt this isolated and alone in my political world since 9/11, and THAT in itself terrifies me. It is the very definition of irony, is it not?

As for me, I DO feel a very strong and powerful sense of renewal since my little sabbatical, and it was just what I needed to recharge. I learned a valuable lesson, and got a harsh reminder that although you must never take your eye off the ball, you have to stay sane to stay in the game.

Everyone else here would do well to remember that as well, and PLEASE, everyone, take care of yourselves and mind your heart and mind, as well as the world around you.

And Invest in a kitten.

It's the cure all for everything apparently.

Good to be back with you all, Doc.

It's about to get REAL interesting.

[Ghost Dog]

84. I think the puppet-strings are fairly evident by now.

With the passage of time more people will see them.

Enter November 4th, 2008.

The mentality and the landscape LITERALLY changed overnight, not unlike the way the Planet Formation took shape at the end of Star Trek II when the Genesis Project activated on the Planet's surface. A whole new world emerged, and the world was awash in a euphoria of relief and hope that somehow a True Savior had arrived, and everything was going to be OK.

Now, just a little less than five months later, those with open eyes are beginning to see we MAY have been sold a Bill Of Goods. That all that really happened was that TPTB changed the Bird Cage Liner, and now the theme of Oppression and Tyranny is "Hope", instead of "Fear" the way it was the last time.

Look, O could be the best person that has ever lived and have the heart and disposition of Christ himself, but the problem is he has surrounded himself with the very same Jackals that got us into this mess to begin with, and his handlers are the same cloth of thugs that have been running this country into the ground for DECADES.

Meet the New Boss. He sure is prettier and a lot more intelligent than the Old Boss, but he might have the same Puppet Strings attached to his well-tailored suits.

[Dr.Phool]

85. That's the sad part.

We started catching on, as soon as he started making his cabinet, and economic panel choices. We've been watching these people for years. We know what their track records are.

Where all the true believers see "hope" and "change", we see more of the same old shit.

I agree with the Watcher. Get prepared. America got sold a bill of goods. I don't see much of a future for us any more.

[burf]

81. Great post!

Welcome back!

[RUMMYisFROSTED]

71. America is back!

:woohoo:

[ozymandius]

73. Closing up the store...

Dow 7,761.60 Up 152.68 (2.01%)
Nasdaq 1,551.60 Up 23.01 (1.51%)
S&P 500 811.08 Up 13.21 (1.66%)
10-Yr Bond 2.658% Down 0.027
NYSE Volume 7,089,259,000
Nasdaq Volume 2,306,379,250

4:30 pm : A handful of economic reports helped stocks reverse early losses to post strong gains. The advance was challenged by a late selling effort for the second straight session, but buyers stepped in to offer their bids.

Stocks initially traded with weakness as participants reacted to an ADP Employment Report that indicated 742,000 jobs were lost in March. Economists expected 663,000 job losses. While the report isn't always a precise predictor of the government's official nonfarm jobs report, which is due Friday, it does present a glimpse into labor market conditions.

Stocks were given a boost upon the release of several other economic reports.

Though the ISM Manufacturing Index for March showed continued contraction in manufacturing, it was essentially in-line with expectations at 36.3, and was up slightly from February's 35.8.

Meanwhile, monthly construction spending for February decreased 0.9%, but that was met with a positive reaction since it wasn't as severe as the 1.9% decline that was widely expected.

A surprise 2.1% increase in February pending home sales also helped improve sentiment. Pending home sales were expected to remain unchanged after declining 7.7% in January.

The broad-based buying effort that followed the reports helped push the S&P 500 past the 800 level, but the move slowed as the benchmark index encountered 810. Still, the S&P 500 was able to close just above that technical hurdle.

Meanwhile, the Dow swung some 275 points from its session low to its close. The reversal was brought about by broad-based strength as 27 of its 30 components logged a gain.

General Motors (GM 1.93, -0.01) was a laggard in the Dow after the company reported U.S. sales for March fell 45% year-over-year. The consensus estimate called for a 48% year-over-year drop.

Ford (F 2.74, +0.11) reported U.S. sales for March fell almost 41% from the prior year, which was slightly less severe than the 45% drop that was expected.

Given the troubles facing global automakers, Honda Motor Company (HMC 25.90, +2.20) announced it will further curtail production in North America, while also reducing salaries.

Health care was the only sector to finish the session with a loss; it spent the entire session in the red before closing 0.3% lower. Biotech stocks traded with considerable weakness after Celgene (CELG 38.47, -5.93) reaffirmed a disappointing forecast. DJ30 +152.68 NASDAQ +23.01 NQ100 +1.3% R2K +1.5% SP400 +1.1% SP500 +13.21 NASDAQ Dec/Adv/Vol 903/1755/2.15 bln NYSE Dec/Adv/Vol 709/2326/1.50 bln

[skoalyman]

74. bad news every were gee by the way stocks rallied

you'd almost think we were living in an alternative universe heck if these guy's had showed up http://web.mac.com/rolandgarret/iWeb/site/For%20a%20Regroupment%20of%20All%20Anti-Capitalist%20Revolutionary%20Forces!_files/ch6-4horsemen_pastorpack_small.jpg market would have rallied past 15,000.00 :woohoo:

[ozymandius]

75. Markets are irrational.

I like to think of them as rich little brats with Obsessive Compulsive Disorder.

[Tansy_Gold]

79. Or ODD

Obsessive Destructive Disorder

(pun intended).




Tansy Gold