STOCK MARKET WATCH, Tuesday, August 30, 2011

[Pale Blue Dot]

Source: du

STOCK MARKET WATCH, Tuesday August 30, 2011

AT THE CLOSING BELL ON August 29, 2011

Dow 11,539.25 +254.71 (+2.21%)
Nasdaq 2,562.11 +82.26 (+3.21%)
S&P 500 1,210.08 +33.28 (+2.75%)
10-Yr Bond... 2.24 -0.02 (-0.84%)
30-Year Bond 3.57 -0.02 (-0.56%)

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Market Conditions During Trading Hours

Euro, Yen, Loonie, Silver and Gold

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Handy Links - Market Data and News:Economic Calendar    Marketwatch Data    Bloomberg Economic News    Yahoo! Finance    Google Finance    Bank Tracker    
Credit Union Tracker    Daily Job Cuts

Handy Links - Economic Blogs:
The Big Picture    Financial Sense    Calculated Risk    Naked Capitalism    Credit Writedowns
Brad DeLong      Bonddad    Atrios    goldmansachs666    The Stand-Up Economist

Handy Links - Government Issues:
LegitGov    Open Government    Earmark Database    USA spending.gov

Handy Links - Videos:
The Coming Collapse of the Middle Class    Charlie Rose talks with Roubini    Charlie Rose talks with Krugman
    William Black: This Economic Disaster    Bill Moyers with Kevin Drum and David Corn

Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren
Dishonorable Mention: former House majority leader, Tom DeLay

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

Financial Sector Officials Convicted since 1/20/09 = 12

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

Read more: du

[Pale Blue Dot]

1. Today's Reports

Aug 30 09:00 Case-Shiller 20-city Index Jun -5.0% -4.7% -4.51%
Aug 30 10:00 Consumer Confidence Aug 50.0 52.0 59.5
Aug 30 14:00 FOMC Minutes Aug. 9

Read more: http://www.briefing.com/investor/calendars/economic/2011/08/29-02/#ixzz1WVGkyVWE

[Demeter]

34. CONSUMER CONFIDENCE RESULTS MEANS PLUNGE

Release For Actual Forecast Consensus Prior Revised From

20-city Index Jun -4.52% -5.0% -4.7% -4.59% -4.51%

Consumer Con. Aug 44.5 50.0 52.0 59.5

Read more: http://www.briefing.com/investor/calendars/economic/2011/08/29-02/#ixzz1WWMlxCP0


THEY EXPECTED 52, GOT 44.5, DOWN FROM 59.5 LAST MONTH....REALITY INDEED!

[Pale Blue Dot]

2. Oil above $87 amid improving US consumer demand

SINGAPORE – Oil prices hovered above $87 a barrel Tuesday in Asia amid signs of improving consumer demand in the U.S.

Benchmark oil for October delivery was down 19 cents to $87.08 at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. Crude rose $1.90 to settle at $87.27 on Monday.

In London, Brent crude for October delivery was down 35 cents at $111.53 on the ICE Futures exchange.

Crude has jumped 16 percent from near $76 three weeks ago amid growing investor optimism the U.S. economy may not slip into recession in the second half.

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

[Pale Blue Dot]

3. 1st day of school! Gotta run!

Have fun in here today!

[xchrom]

4. Have a good one, PBD! & thank you. Nt

[Tansy_Gold]

13. A salute to all the teachers!

:yourock:

[DemReadingDU]

23. +++ for all teachers!

and a big thanks for your chosen profession!

[AnneD]

48. This is week .....

#2 for me, thus my silence. I really like my new school. I get plenty of support.

We are still without good rain and triple digits. They are saying it may drop down into the mid 90's over Labor Day weekend, but we get nothing from Irene.

[Festivito]

5. Debt: 08/26/2011 14,653,828,192,917.35 (UP 280,306,561.24) (Fri, UP some.)

(UNDER the new 2011 debt limit of 14.694-trillion dollars by 359.828-billion dollars. Good day.)
Cool night after warm day. Yum.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,990,047,413,541.98 + 4,663,780,779,375.37
UP 1,003,663,200.19 + DOWN 723,356,638.95

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 313-Million person America.
If every American, man, woman and child puts in $3.20 THAT'S 1B$, and $3,197.40 makes 1T$.
A family of three: Mom, Dad, Child: $9.59, ABOUT TEN BUCKS for a 1B$ 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 12 seconds we net gain another American, so at the end of the workday of the report, there should be 312,754,592 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $46,854.08.
A family of three owes $140,562.24. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 24 reports in the last 30 to 31 days.
The average for the last 24 reports is 12,958,253,181.92.
The average for the last 30 days would be 10,366,602,545.54.
The average for the last 31 days would be 10,032,196,011.81.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 225 reports in 330 days of FY2011 averaging 4.85B$ per report, 3.31B$/day.
Above line should be okay

PROJECTION:
There are 513 days remaining in this Obama 1st term.
By that time the debt could be between 15.4 and 19.8T$.
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)
08/26/2011 14,653,828,192,917.35 BHO (UP 4,026,951,144,004.27 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +1,092,205,162,025.60 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof11 +1,208,045,103,452.56 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
08/08/2011 +000,521,563,614.23 ------------******** Mon
08/09/2011 +000,429,866,034.74 ------------********
08/10/2011 +000,350,635,620.42 ------------********
08/11/2011 +004,850,153,175.74 ------------*********
08/12/2011 +000,032,128,181.66 ------------*******
08/15/2011 +025,439,150,731.40 ------------********** Mon
08/16/2011 -000,111,149,424.58 ---
08/17/2011 -000,155,359,363.72 ---
08/18/2011 +006,258,648,233.06 ------------*********
08/19/2011 +019,892,825,521.14 ------------**********
08/22/2011 -000,213,053,000.99 --- Mon
08/23/2011 +000,814,357,949.50 ------------********
08/24/2011 +000,495,517,849.57 ------------********
08/25/2011 +015,444,082,130.78 ------------**********
08/26/2011 +001,003,663,200.19 ------------*********

75,053,030,453.14 Total of 15 above reports.

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

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4977296&mesg_id=4977307

[Festivito]

55. Debt: 08/29/2011 14,624,792,689,793.86 (DOWN 29,035,503,123.49) (Mon, DOWN a little.)

(UNDER the new 2011 debt limit of 14.694-trillion dollars by 330.793-billion dollars. Good day.)
Should I go on a birthday dinner with my neighbor.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,989,974,192,571.08 + 4,634,818,497,222.78
DOWN 73,220,970.90 + DOWN 28,962,282,152.59

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 313-Million person America.
If every American, man, woman and child puts in $3.20 THAT'S 1B$, and $3,197.17 makes 1T$.
A family of three: Mom, Dad, Child: $9.59, ABOUT TEN BUCKS for a 1B$ 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 12 seconds we net gain another American, so at the end of the workday of the report, there should be 312,776,192 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $46,758.01.
A family of three owes $140,274.03. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 31 days.
The average for the last 22 reports is 12,837,427,436.28.
The average for the last 30 days would be 9,414,113,453.27.
The average for the last 31 days would be 9,110,432,374.14.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 226 reports in 333 days of FY2011 averaging 4.70B$ per report, 3.19B$/day.
Above line should be okay

PROJECTION:
There are 510 days remaining in this Obama 1st term.
By that time the debt could be between 15.3 and 19.3T$.
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)
08/29/2011 14,624,792,689,793.86 BHO (UP 3,997,915,640,880.78 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +1,063,169,658,902.10 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof11 +1,165,336,112,610.41 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
08/09/2011 +000,429,866,034.74 ------------********
08/10/2011 +000,350,635,620.42 ------------********
08/11/2011 +004,850,153,175.74 ------------*********
08/12/2011 +000,032,128,181.66 ------------*******
08/15/2011 +025,439,150,731.40 ------------********** Mon
08/16/2011 -000,111,149,424.58 ---
08/17/2011 -000,155,359,363.72 ---
08/18/2011 +006,258,648,233.06 ------------*********
08/19/2011 +019,892,825,521.14 ------------**********
08/22/2011 -000,213,053,000.99 --- Mon
08/23/2011 +000,814,357,949.50 ------------********
08/24/2011 +000,495,517,849.57 ------------********
08/25/2011 +015,444,082,130.78 ------------**********
08/26/2011 +001,003,663,200.19 ------------*********
08/29/2011 -000,073,220,970.90 ---- Mon

74,458,245,868.01 Total of 15 above reports.

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

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4978495&mesg_id=4978526

[Demeter]

6. How can I be #11? It's only 7:21 AM!

Anyway, having a crazy day....probably won't be posting until dinner...if then.

PBD, are you back on school time?

[Viva_La_Revolution]

22. only 5:40 here, and #17

:hangover:

[mrdmk]

7. Larrs77 posted a video about speculation and the problems associated with it

In the video, facts are presented how speculation can work to benefit the economy. Whereas, facts are presented how speculation can ruin the economy. Guess where we are now?

Link: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x612999

[philly_bob]

43. Long, but worth sitting through. Bottom line: enforce position limits on banks.

Source (TheRealNews) and speaker (a professor at University of Maryland) seem legit.

[xchrom]

8. Former Bank of America employee sentenced in mortgage fraud scheme

http://latimesblogs.latimes.com/money_co/2011/08/former-bank-of-america-employee-sentenced-in-mortgage-fraud-scheme.html

A North Hollywood man has been sentenced to 15 months in federal prison for his role in a scheme that used stolen identities to “purchase” homes that were not for sale, according to the U.S. attorney's office in L.A.

Federal authorities said Venedie Roberto Valencia, 27, worked at Bank of America at the time of the offense. In a guilty plea, Valencia admitted that he forged a document related to nonexistent bank accounts, prosecutors said.

In addition to the prison sentence, U.S. District Judge Dale S. Fischer in Los Angeles ordered Valencia to pay $51,688 in restitution, said a statement issued by Thom Mrozek, a spokesman for the U.S attorney's office in Los Angeles.

Two co-conspirators were previously convicted, the statement said. Felix Pichardo, 29, a licensed real estate agent from Lancaster, was sentenced to eight years in federal prison in 2009. Latrice Shaunte Borders, 31, of Long Beach, was sentenced to two years in federal prison in 2010.

[Demeter]

26. Small Fish

They should have done what the big guys are doing. After all, it's perfectly legal...now...thanks to the bribes to Congress and abandonment of Rule of Law, prosecutions, regulations, and such.

[xchrom]

9. Pending home sales fall in July

http://latimesblogs.latimes.com/money_co/2011/08/pending-home-sales-fall-in-july.html

The number of purchase contracts signed on previously owned houses declined in July, according to industry data, the latest sign the nation's housing market remains troubled.

The National Assn. of Realtors’ pending home sales index fell to 89.7 last month. That was a 1.3% decline from June, but 14.4% above the July 2010 level.

Contracts are a leading indicator for home sales and most deals close within months of a contract being signed. A level of 100 on the home sale index is equal to the average monthly activity during 2001, which the real estate group considers a historically healthy level.

The nation's housing market has been weak since the expiration of tax credits for buyers in April 2010. This year has been marked by a renewed housing decline with potential buyers concerned over the future of the economy.

[xchrom]

19. Home Prices in U.S. Probably Fell in June

http://www.bloomberg.com/news/2011-08-30/home-prices-in-u-s-probably-fell-as-real-estate-hindered-economic-rebound.html

Residential real estate prices probably dropped in the year ended June by the most in 19 months, indicating the housing market continues to hamper the U.S. recovery, economists said before a report today.

The S&P/Case-Shiller index of home values in 20 cities fell 4.6 percent from June 2010, the biggest 12-month decrease since November 2009, according to the median forecast of 31 economists surveyed by Bloomberg News. Another report may show consumer confidence sank in August to the lowest level in 10 months.

Any recovery in home values is probably years away as foreclosures dump more properties onto to the market, while a jobless rate hovering around 9 percent and strict lending rules hurt sales. Declining home equity combined with the slump in stock prices this month is damaging household wealth, raising the risk that spending will falter.

“There are just too many factors that will continue to drag home prices down,” said Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts. “We still have a lot of foreclosures in the pipeline, a lot of excess supply, and demand for homes is continuing to weaken.”

[xchrom]

10. south asia: Gold down by Rs 305, silver sheds Rs 300 on global cues

http://timesofindia.indiatimes.com/business/india-business/Gold-down-by-Rs-305-silver-sheds-Rs-300-on-global-cues/articleshow/9796448.cms

Gold down by Rs 305, silver sheds Rs 300 on global cues
PTI

Extending losses for the second day in a row, both gold and silver witnessed a decline in the national capital's bullion market on sustained selling by stockists in tandem with a weak global trend.

NEW DELHI: Extending losses for the second day in a row, both gold and silver witnessed a decline in the national capital's bullion market on sustained selling by stockists in tandem with a weak global trend.

While gold lost Rs 305 at Rs 27,185 per 10 grams, silver shed Rs 300 to Rs 62,500 per kg.

[xchrom]

11. Sensex closes 260 points up on firm global trend

http://timesofindia.indiatimes.com/business/india-business/Sensex-closes-260-points-up-on-firm-global-trend/articleshow/9797500.cms

MUMBAI: Despite a slowdown in the economic growth, the BSE benchmark Sensex rose 260 points on Tuesday on a firm global trend as higher US consumer spending data ignited hopes of global economic recovery.

The Bombay Stock Exchange 30-share index, Sensex, which had gained 567.50 yesterday, rose further by 260.42 points to 16,676.75. Intra-day, it touched a high of 16,714.70.

Similarly, the broad-based National Stock Exchange index Nifty rose by 81.40 points to 5,001 led by metals, realty, banks and IT.

Brokers said there was good buying in fundamentally strong stocks available at lower prices following the recent meltdown and the market was completely moving on cues from the world equity markets.

[AnneD]

49. How can you take it seriously....

when it is called the SENSEX. And when you have those wild market gyrations, well.......

My new book...Karma Sutra for the Indian marketplace, complete with graphic porn. I think it might be a best seller.:evilgrin:

Oops, back to work.......

[xchrom]

21. Birla Sun Life Raises Cash Holdings as India Enters Bear Market, CIO Says

http://www.bloomberg.com/news/2011-08-30/birla-sun-life-raises-cash-holdings-as-india-enters-bear-market-cio-says.html

Birla Sun Life Asset Management Co., India’s fifth-biggest money manager, increased its cash level as the nation’s stocks entered a bear market this month amid a rout in global equities.

Birla Sun Life, which raised its cash holdings to about 8 percent from 5 percent three months ago, may use the funds to “catch certain stocks when there is a sharp correction in the market,” Mahesh Patil, who oversees about $3 billion in stocks as co-chief investment officer, said yesterday in an interview in Mumbai. He declined to say when he would deploy the money.

The Bombay Stock Exchange Sensitive Index, or Sensex, has slid 21 percent from its Nov. 5 peak, more than the 20 percent level that marks a bear market, on concern the U.S. is slowing and Europe’s debt crisis may worsen. Companies on the measure trade at 13.9 times future profits, near the lowest level since April 2009, and down from 21.5 times in March 2010.

“Markets seem to be discounting most of the concerns and valuations are below long-term averages,” said Patil, whose firm has $14.7 billion in total assets.

[xchrom]

12. asia: Asian stocks rise as US consumers spending grows

http://timesofindia.indiatimes.com/business/international-business/Asian-stocks-rise-as-US-consumers-spending-grows/articleshow/9793798.cms

BANGKOK: Asian stock markets advanced Tuesday as investors took heart from strong consumer spending in the US and a deal to combine two major banks in debt-stricken Greece.

Oil prices hovered above $87 a barrel in Asia while the dollar weakened against the yen and the euro.

The Nikkei 225 index in Tokyo added 1.3% to 8,965.31 as investors seized on the positive U.S. figures and overlooked a rise in Japan's unemployment rate.

Hong Kong's Hang Seng gained 2.2% to 20,305.99 and South Korea's Kospi was 0.8% higher at 1,844.37. Australia's S&P/ASX 200 rose 0.2% to 4,272.90.

[xchrom]

20. China Faces Dwindling Labor Supply

http://www.bloomberg.com/news/2011-08-29/china-faces-upgrade-or-die-deadline-as-one-child-policy-saps-labor-supply.html

Lin Chang Jie is battling to save a family business making towels, cushions and robes in the eastern Chinese city of Ningbo as a dwindling supply of workers forces him to pay higher wages.

“I have to find a new way,” says Lin, 29, who is turning his Dejin Textile Co. into an online fashion retailer to cut costs and keep the business from closing. “Wages are going up, up, up. If we don’t like somebody’s work we can’t say anything, in case they leave.”

China’s three-decade-old, one-child policy will accelerate declines in the workforce, forcing companies to upgrade to higher-value products in the way Japan did in the 1960s and 70s. China may have as little as five years to make the transition to avoid a slump in economic growth, according to Sun Mingchun, an analyst at Daiwa Capital Markets in Hong Kong and former economist at China’s State Administration of Foreign Exchange, part of the central bank. He said growth may decline in 2016-20 as low-cost producers fail and investment falls away.

“This is the big issue in China on which everything will turn,” said Barry Eichengreen, an economics professor at the University of California at Berkeley and former senior policy adviser to the International Monetary Fund, who contributed to the 2010 book: “Emerging Giants: China and India in the World Economy.” “China needs to really accelerate this transition.”

[Po_d Mainiac]

45. And they ain't gonna get any taller

breathing bad air, drinkin putrid water, and/or ingesting toxins bio-accumulating in the food supply

[Demeter]

47. Maybe they'll give us our jobs back, and our manufacturing base

:rofl:

[xchrom]

14. Hedge fund Gotterdammerung

http://www.atimes.com/atimes/Global_Economy/MH31Dj01.html

The past 30 years have been notable for the rise of hedge funds, organizations that compete with the top Wall Street investment banks in remuneration, while charging their investors fees far above those traditional for investment management services.

Hedge funds had a mixed record in 2007-08; there were several large failures but also some notable successes. However in 2010 and 2011 hedge fund performance has been distinctly below par, and it is appropriate to wonder whether their rationale for outsize fees and remuneration will continue to prove convincing over the long term.

Hedge funds enjoyed a brief burst of success in the late 1960s, a period like the last 16 years of considerable speculative froth


(albeit with significantly higher real interest rates - the annual average real 10-year treasury bond yield was 1.77% in 1967 and 0.94% in 1968, still low but above the recent sub-zero levels). It was the era of "gunslinger" investment managers like Jerry Tsai, whose Manhattan Fund pulled in a then record $247 million on its launch in 1965. Naturally, in such an environment, it was appealing to wealthy investors to employ a specialist investment manager to achieve even higher returns, using a "hedged" strategy going both long and short.

In the event, the "hedged" strategy was not truly hedged, but got creamed in the difficult markets of 1969-72. By the time I was attending Harvard’s Investment Management class in early 1973 under the estimable Professor Jay Light, hedge fund managers had become figures of professorial fun, "rolling the dice" by investing continually in the mythical "XYZ Datawhack", promising outrageously high returns to their investors and losing their shirts.

[xchrom]

15. David Prosser: Why we must snuff out the bankers' attempts to prevaricate on reform

http://www.independent.co.uk/news/business/comment/david-prosser-why-we-must-snuff-out-the-bankers-attempts-to-prevaricate-on-reform-2345954.html

There is no excuse for failing to see it coming. Britain's biggest banks have spent the whole summer ratcheting up the rhetoric ahead of the publication next month of the final report of the Independent Commission on Banking, dropping ever-less-subtle hints about the dark days to come should Sir John Vickers' inquiry dare to be too bold. Now Angela Knight, the banks' cheerleader-in-chief, has come right out and said it: as The Independent revealed yesterday, Ms Knight intends to campaign for a delay in the implementation of whatever reforms Sir John proposes. The chief executive of the British Bankers' Association argues that the nation's economy is not strong enough to withstand a shake-up of the sector that might make it even tougher for our brave banks to fuel the recovery with much-needed credit.

Let us not be entirely cynical. While the banks' shrill warnings about the implications of the ICB's proposals reflect self-interest – the volume rose as it began to sink in that Sir John would not be the patsy for which bankers had prayed – there is some logic in what Ms Knight is saying. In fact, her argument mirrors the counter-cyclical approach our financial regulators are now supposed to take.

Andrew Haldane, the Bank of England's executive director for financial stability – and a member of the new Financial Policy Committee charged with looking at the big picture – made headlines with a speech this month on that issue. In tough times, the FPC's job would be to take the pressure off, Mr Haldane explained, just as it would be to bear down on excess when parts of the economy were racing ahead.

Might that mean less exacting capital standards for the banks at moments of stress – in order to enable them to keep the flow of credit going, for example? Well that is possible. Mr Haldane pointed out that this was exactly how President Roosevelt sought to handle the US economic crisis of the 1930s – and the strategy worked.

[xchrom]

16. europe: Plunge in vital services sector adds to fears of UK double dip

http://www.independent.co.uk/news/business/news/plunge-in-vital-services-sector-adds-to-fears-of-uk-double-dip-2345949.html

Business activity in Britain's dominant services sector has fallen at the fastest rate since the economy was barely crawling out of recession, a CBI survey shows.

The quarterly survey of the employers' lobby, which is published today,reveals an accelerating decline in the consumer services industry, as well as a surprise drop in business and professional services.

The overall fall in activity is the worst since November 2009 when the economy was still reeling from the longest recession since the war.

The CBI said that consumerservices such as hotels, restaurants and travel suffered a steeper fall in business volume and value than expected as activity dropped at the fastest rate since late 2009.

[xchrom]

17. Bank shares lead market rise

http://www.independent.co.uk/news/business/news/bank-shares-lead-market-rise-2346048.html

A much-needed boost for beleaguered shares in the banking sector helped London's FTSE 100 Index jump by more than 2% today.

Taxpayer-backed Royal Bank of Scotland led the way with a share price rise of 9% after brokers at Deutsche Bank introduced a buy rating on the stock.

The London market, which was closed for the bank holiday yesterday, was also catching up with gains overseas after positive consumer spending data in the United States and news of a merger of two major banks in debt-laden Greece helped ease fears of a global recession.

While the London market was closed yesterday, the Dow Jones Industrial Average in the US made gains of more than 2%, and Asian markets also pushed higher overnight.

[xchrom]

38. European Economic Confidence Falls Most Since December 2008

http://www.bloomberg.com/news/2011-08-30/european-economic-confidence-falls.html

European confidence in the economic outlook in August plunged the most since December 2008 as a persistent debt crisis roiled markets and clouded growth prospects across the 17-nation euro region.

An index of executive and consumer sentiment in the single- currency region fell to 98.3 from a revised 103 in July, the European Commission in Brussels said today. That’s the lowest since May 2010. Economists had forecast a decline to 100.2, according to the median of 29 estimates in a Bloomberg News survey.

The euro area’s economic prospects are deteriorating as national governments cut spending in a bid to narrow deficits and tackle the debt crisis. Economic and Monetary Affairs Commissioner Olli Rehn signaled yesterday that the EU may reduce its 2011 growth forecast from 1.6 percent on concerns that financial turbulence could spill into the broader economy.

“The risk of recession in the euro area has clearly increased as demand from Asia is flagging and governments’ efforts to cut fiscal deficits are curbing domestic consumption,” said Daniel Hartmann, an economist at Zug, Switzerland-based Bantleon Bank AG and the most accurate European forecaster in a Bloomberg News ranking. “I expect the indicator to decline further in the coming months.”

[xchrom]

40. European Stocks Advance for Second Day on Outlook for Growth as Banks Gain

http://www.bloomberg.com/news/2011-08-30/european-stock-index-futures-gain-on-growth-outlook-ipsen-ubi-may-move.html

European stocks pared their advance as a report showed confidence among U.S. consumers plunged in August to the lowest in more than two years.

The Stoxx Europe 600 Index rose 0.3 percent to 229.01 at 3:02 p.m. in London, having earlier rallied 1.8 percent. The gauge has still tumbled 14 percent this month, the biggest drop since September 2002, as European and U.S. economic reports trailed forecasts, adding to concern that the economic recovery is at risk. The decline has left the measure trading at about 9.6 times estimated earnings, near the cheapest since March 2009, data compiled by Bloomberg show.

[xchrom]

41. Companies Stop Selling Bonds as Borrowing Costs Jump by 40%: Euro Credit

http://www.bloomberg.com/news/2011-08-29/companies-stop-selling-bonds-as-costs-jump-by-40-euro-credit.html

Company bond sales have ground to a halt in Europe, with August poised to end without a single offering as the sovereign debt crisis drives borrowing costs up by 40 percent.

“When spreads are moving so quickly, it’s very difficult to see clearly how to price new issues,” said Olivier Casanova, the head of financing and treasury at PSA Peugeot Citroen in Paris, which last sold bonds in euros on June 15. “Conditions are very volatile.”

Bayerische Motoren Werke AG (BMW), the world’s biggest maker of luxury vehicles, was the last non-financial company to sell debt in the common currency maturing in longer than two years, borrowing 1 billion euros ($1.4 billion) on July 22 in a bond due 2018, according to data compiled by Bloomberg. Only banks’ top-rated, asset-backed covered bonds are being sold as investors seek the safest corporate securities.

The extra yield investors demand to own corporate bonds rather than government securities surged to a two-year high of 186 basis points from 134 at the end of July, Bank of America Merrill Lynch indexes show. Yield premiums are climbing as speculation Greece will default forces the European Central Bank to buy Spanish and Italian bonds, and after second-quarter euro- area growth slowed to the worst since the region emerged from recession in 2009.

[xchrom]

18. Struggling to see the wood for the trees

http://www.independent.co.uk/news/business/analysis-and-features/struggling-to-see-the-wood-for-the-trees-2345963.html

Regulators in North America are trying to clean up the auditing of Chinese companies that list on their stock markets, after a string of scandals that have left Western investors – from retail traders to famed hedge fund managers – nursing huge losses.

In the latest and most spectacular blow-up, the chief executive of theChinese forestry company Sino-Forest quit after being accused of fraud by Canada's Ontario Securities Commission (OSC).

Meanwhile, shares in dozens of smaller companies remain suspended as the US Securities andExchange Commission pursuesinvestigations of their auditing practices, and the stock prices of those that remain keep plunging because investors fear the next revelations. The parade of dreadful headlines threatens to undermine Chinese companies' attempts to tap developed world markets and to sour Western investors' love affair with the world's second largest economy.

Allen Chan, a popular Hong Kong newspaper columnist who turned himself into a forestry company boss when he set up Sino-Forest in 1994, submitted his resignation on Sunday night, just as the company's independent directors placed three other executives on administrative leave.

[Po_d Mainiac]

24. Now I get it!

If Sino-Forest misrepresents the values of it's assets, that's bad.

If BAC fails to accurately reflect the values of its assets and understates liabilities, that's good.

[xchrom]

25. i think we're ALL starting to 'get it'

:evilgrin:

[Po_d Mainiac]

28. All?

Likely fewer than 10%

[Demeter]

27. After all the pet food, baby food, pharmaceutical scandals

what MORON decided that the stock market was immune to fraud? (And why only pick on the Chinese?)

[Demeter]

32. Bond investors expect Sino-Forest default

$600m-worth of Chinese forestry company’s bonds due in October 2017 trade at 31 cents on the dollar


Read more >>
http://link.ft.com/r/EB8122/U1HX8B/Q38E1/5COFMN/B5WS2G/AZ/t?a1=2011&a2=8&a3=30

NO GOVERNMENT BAILOUT FOR CHINESE (UNLESS THEY CAN GET UNCLE SUGAR TO DO THE NASTY, I SUPPOSE)

[xchrom]

35. good find -- i've been reading a lot about sino forestry -- haven't posted it

because i didn't think anyone would care.

but this article provided a way to look at it w/ interest from more folk.

[Demeter]

29. I've hit the second detour of the day, and it's not even 10 AM

so there's time for a couple posts...

Looks like it might be a reality day. Good. Why should we be the only ones stuck in Reality?

[Demeter]

30. BofA to sell part of CCB stake for $8.3bn

Beleaguered bank raises additional capital by selling about half of its holding in the Chinese lender to a group of investors

Read more >>
http://link.ft.com/r/EB8122/U1HX8B/Q38E1/5COFMN/AM49VP/AZ/t?a1=2011&a2=8&a3=30

BANKER, BAIL THYSELF!

[Demeter]

31. Hedge funds burned by August market heat

According to provisional estimates, the average vehicle has lost 4.1% during the month – making it the industry’s fourth worst ever

Read more >>
http://link.ft.com/r/EB8122/U1HX8B/Q38E1/5COFMN/AM49VF/AZ/t?a1=2011&a2=8&a3=30

[Demeter]

33. Archer Daniels Midland in US fines alert

Archer Daniels said it had hired lawyers to review transactions that may have broken laws including the US Foreign Corrupt Practices Act

Read more >>
http://link.ft.com/r/EB8122/U1HX8B/Q38E1/5COFMN/IIQUWC/AZ/t?a1=2011&a2=8&a3=30

[Demeter]

36. Chinese tycoon seeks to buy tract of Iceland

A Chinese tycoon plans to buy a vast tract of Icelandic land for a $100m tourism project which critics fear could give Beijing a strategic foothold in the North Atlantic

Read more >>
http://link.ft.com/r/BLH300/3029RV/Q38E1/26GSA7/HYEPG9/YT/t?a1=2011&a2=8&a3=29

[Demeter]

51. They will have to negotiate with the elves and trolls, though: Elves come alive for Icelanders

http://articles.baltimoresun.com/1999-12-25/news/9912250134_1_iceland-hidden-people-elves

HAFNARFJORDUR, Iceland -- This can be a tough country for blasting out a foundation or constructing a roadbed.

Never mind the boiling geysers, wind-blasted precipices or frozen barrens. It's not the razor-sharp lava rock that daunts builders; it's the hidden people lurking below.

"There are all sorts of beings beneath our stones," says Brynjolfur Snorrason, a folklorist often asked to advise contractors on how best to avoid the lairs of Iceland's elves and other seldom-seen creatures, whose presence nonetheless seems to permeate this far northern island nation.

Highway engineers in recent years have been forced to reroute roads around supposed elf dwellings. Builders of the country's first shopping mall took care to lay electrical cables and other underground installations well away from suspected abodes of gnomes and fairies. Couples planning a new house will sometimes hire "elf-spotters" to ensure the lot is free of spirit folk.

In Iceland, such precautions are seen as simple prudence...

[xchrom]

37. Dead Enron CEO Lay Beats IRS in Tax Court

http://www.bloomberg.com/news/2011-08-29/enron-ceo-kenneth-lay-bests-irs-in-tax-court.html

Kenneth Lay, the deceased chief executive officer of Enron Corp., defeated the Internal Revenue Service in the agency’s bid to collect $3.9 million from his estate and his wife, the U.S. Tax Court ruled.

The case decided yesterday involved transactions among Lay, his wife, Linda, and Enron that were executed on Sept. 21, 2001. The Lays sold $10 million in annuities to Enron as part of an agreement for him to retake the CEO position, under the stipulation that the annuities would be returned to Lay if he worked a 4.25-year term. The company didn’t survive that long, and it filed for bankruptcy protection in December 2001.

The IRS contested the Lays’ contention that the annuities were sold to Enron for no gain, according to the Tax Court decision by Judge Joseph Goeke. In 2009, the IRS filed a notice of tax deficiency for $3.9 million, arguing that the Lays should have reported the $10 million as income in 2001. Instead, they reported that they sold the annuities to Enron at their cost basis, generating no taxable income.

[Demeter]

39. HMMM, interesting

I have to go face my next encounter with what passes for reality around here...see you all tonight?

[xchrom]

44. have a good day miss demeter!

i'm too old to stay on the computer in the evening -- screws up my sleep.

[Demeter]

46. Sleep? What's that?

I have to take a nap now...I'm feeling really dizzy for lack thereof...

[tclambert]

53. Ken Lay, still entertaining long after his death. I'm sure he's keeping warm,

unlike many of his former employees and stockholders who lost their life savings.

[xchrom]

42. U.S. Consumer Confidence Falls to Lowest Since ’09 as Index Slumps to 44.5

http://www.bloomberg.com/news/2011-08-30/u-s-consumer-confidence-drops-to-lowest-since-09-as-index-slumps-to-44-5.html

Confidence among U.S. consumers plunged in August to the lowest in more than two years as Americans’ outlooks for employment, incomes and business conditions soured.

The Conference Board’s index slumped to 44.5, the weakest since April 2009, from a revised 59.2 reading in July, figures from the New York-based private research group showed today. It was the biggest point drop since October 2008. Economists predicted the August gauge would fall to 52, according to the median forecast in a Bloomberg News survey.

An unemployment rate above 9 percent, declining home values and a volatile stock market this month have weighed on Americans’ sentiment. Increased pessimism may make households less apt to open their wallets, a hurdle for the economy and retailers such as Gap Inc. (GPS)

[DemReadingDU]

50. and the stock markets rally

:eyes:

[Demeter]

52. The computers shuffling 50K shares amongst themselves, most likely

Yesterday's volume was almost certainly all machine/algorithm trading, it was so low...

[DemReadingDU]

54. Those machine/algorithm trades

can also bring the markets to a flash crash such as what happened on May 6, 2010

http://en.wikipedia.org/wiki/2010_Flash_Crash

[Demeter]

56. And despite all their wheeling-dealing, Reality STILL Won Out