STOCK MARKET WATCH, Thursday September 20

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday September 20

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 488 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2449 DAYS
WHERE'S OSAMA BIN-LADEN? 2161 DAYS
DAYS SINCE ENRON COLLAPSE = 2122
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

AT THE CLOSING BELL ON September 19, 2007

Dow... 13,815.56 +76.17 (+0.55%)
Nasdaq... 2,666.48 +14.82 (+0.56%)
S&P 500... 1,529.03 +9.25 (+0.61%)
Gold future... 729.50 +5.80 (+0.80%)
30-Year Bond 4.82% +0.06 (+1.34%)
10-Yr Bond... 4.52% +0.04 (+0.98%)






GOLD, EURO, YEN, Loonie and Silver

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PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp

Fill 'Er Up, Please
BY CHRIS PUPLAVA

The Fed’s decision to lower both the federal funds rate and discount rate by half a percent vaulted the markets northward with the Dow putting in its greatest advance in years. The move by the Fed was a bold statement that with Bernanke at the helm the Fed will do whatever is necessary to support the markets as well as the economy. Thus, the Fed has emphatically declared it will fill the punchbowl of liquidity to overflowing after removing it from the economic party over the last few years.

Continuing with loose monetary policy, Treasury Secretary Henry Paulson told Congress today that the federal government will hit its debt ceiling on October 1st, and urged Congress to raise the debt limit to protect the “full faith and credit” of the country. Paulson urged the Senate to pass legislation approved earlier in the month by the Senate Finance Committee to increase the national debt limit to $9.82 trillion dollars, an increase of $850, which is the fifth increase in the government's borrowing since George Bush took office in 2001.

In another about face, the Bush Administration reversed their policy by allowing Fannie Mae and Freddie Mac, the nation’s two largest providers of mortgage financing, to expand their investments in order to support the mortgage markets. The Office of Federal Housing Enterprise Oversight (OFHEO) will allow both Fannie and Freddie to increase their mortgage portfolios by 2% a year beyond their existing cap of roughly $1.5 trillion. The new rules would allow Fannie Mae to add $12 billion of mortgage assets and $22 billion for Freddie Mac.

These monetary and fiscal moves were conducted to stem the ongoing collapse in housing. RealtyTrac on Tuesday said foreclosure filings jumped to 243,947 in August, up 115% from August 2006 and up 36% from July. The company reported that foreclosure filings were under way nationwide in an average of one in 510 homes, with bank repossessions in August coming in at 42,789, up 60% from the 26,842 bank repossession reported in July. The hardest hit areas continue to be Nevada, California, and Florida, where fillings were under way in one in 165 homes, one in 224 homes, and one in 243 homes respectively.

-cut-

The move by the Fed yesterday was an attempt at averting a recession that is becoming more and more likely with each passing month. Housing has clearly spilled over into the general economy with a contraction in both employment and retail sales. In fact, we are on the verge of a recession right here and now according to both employment and retail sales numbers. In the past three recessions the economy had either just entered or was about to enter a recession when the three month moving average in monthly payroll gains turned negative. Also seen in the last three recessions was the 12 month moving average for the YOY change in retail sales dipping below 4%.

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

[ozymandius]

2. Today's Reports

8:30 AM Initial Claims 09/15
Briefing Forecast 320K
Market Expects 320K
Prior 319K

10:00 AM Leading Indicators Aug
Briefing Forecast -0.5%
Market Expects 0.0%
Prior 0.4%

12:00 PM Philadelphia Fed Sep
Briefing Forecast 5.0
Market Expects 2.5
Prior 0.0

http://biz.yahoo.com/c/e.html

[UpInArms]

26. Initial Claims in @ 311,000

01. U.S. 4-week avg. initial claims down 3,500 to 320,750
8:30 AM ET, Sep 20, 2007 - 1 minute ago

02. U.S. continuing jobless claims fall 53,000 to 2.54 million
8:30 AM ET, Sep 20, 2007 - 1 minute ago

03. U.S. initial jobless claims fall 9,000 to 311,000
8:30 AM ET, Sep 20, 2007 - 1 minute ago

[UpInArms]

45. U.S. leading indicators fall 0.6% in August

http://www.marketwatch.com/news/story/us-leading-indicators-fall-06/story.aspx?guid=%7B4183A608%2D5D3F%2D4937%2DB6E0%2D9BE060AEBCD0%7D&dist=morenews

WASHINGTON (MarketWatch) - A gauge of future economic growth plunged 0.6% in August, pointing to slower economic growth ahead, the Conference Board reported Thursday. Just one of the 10 leading economic indicators was positive in August: the real money supply. The index of leading economic indicators, designed to forecast economic turning points, has been up and down all year. Over the past six months, the leading index has risen 0.5%, with six of the 10 indicators advancing. In July, the index rose 0.7%, revised up from an 0.4% gain reported earlier. Economist Ken Goldstein said the economy has two big potential problems to overcome: Sagging business confidence and weaker consumer spending as household wealth declines along with home prices.

[UpInArms]

74. Philly Fed Sept. index 10.9 vs. 0.0 in August

01. Philly Fed Sept. index 10.9 vs. 0.0 in August
12:03 PM ET, Sep 20, 2007 - 3 minutes ago

[Roland99]

83. So, uh, is that like inifinty % increase?

;)

[ozymandius]

97. I take fortune cookie messages more seriously than these numbers nowadays.

From zero-point-zero to 10.9 in one month? Why not make it a thousand?

[OnceUponTimeOnTheNet]

3. K&R nt

[Roland99]

6. Ditto.

Not sure if I'll be around this thread much today.

Going to head into work today and I'm sure I'll have a boatload of stuff piled up. wheeee.

[ozymandius]

4. Oil prices slip from record close

SINGAPORE - Oil prices dipped on profit-taking Thursday after reaching record highs in the previous session on U.S. refinery outages and declines in U.S. oil inventories.

The decline was limited by worries over a potential tropical storm threat to oil and gas installations in the Gulf of Mexico, analysts said.

-cut-

Light, sweet crude for October delivery lost 11 cents to $81.82 a barrel in Asian electronic trading on the New York Mercantile Exchange by midafternoon in Singapore.

The contract Wednesday rose 42 cents to settle at a record $81.93 a barrel after jumping to a new intraday high of $82.51 a barrel.

-cut-

Crude inventories fell by 3.8 million barrels during the week ended Sept. 14, said the Energy Information Administration, the department's statistical arm. This was more than double the 1.5 million-barrel decline analysts surveyed by Dow Jones Newswires had expected. However, crude inventories remain at the upper end of their average range for this time of year, the EIA said.

Refinery utilization fell 0.9 percentage point to 89.6 percent of capacity. Analysts expected a decline of half a percentage point. However, gasoline supplies rose by 400,000 barrels, the EIA said, countering analyst predictions of a 1.3 million-barrel decline.

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

[ozymandius]

5. Health costs are key to GM-UAW talks

DETROIT - The United Auto Workers would become one of the nation's largest consumers of health care if it takes over retiree obligations from Detroit's automakers, a huge responsibility that would test the union's ability to control rising health care costs.

Health care is at the heart of bargaining between the UAW and General Motors Corp., which was set to continue Thursday. The union's contract with GM has been extended hour by hour since Friday.

The negotiations are dragging on because of a complex plan to unload GM's roughly $51 billion in unfunded retiree health costs to a trust administered by the union. In exchange, the UAW wants promises that GM will continue building cars at union-represented plants.

The two sides have yet to agree on how much GM will put into the trust, a person who had been briefed on the bargaining said Wednesday. The person, who requested anonymity because the negotiations are private, said the talks likely would take several more days to complete. Ford Motor Co. and Chrysler LLC are likely to ask for a similar arrangement for their retiree health costs.

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/auto_talks

[Robbien]

80. This is really sad

GM didn't fulfill their obligation to fund prior year's health care costs and now they are using their non-funding as a bargaining chip for future years' negotiations.

Prior union negotiations were not met by GM but GM feels their non-compliance can be an asset to them and something to hold over the heads of union workers.

[ozymandius]

7. Paulson considering mortgage change

WASHINGTON - As Congress weighs remedies for the mortgage-market crisis, Treasury Secretary Henry Paulson is signaling that the Bush administration would consider allowing the big mortgage companies Fannie Mae and Freddie Mac to temporarily buy, bundle and sell as securities loans exceeding $417,000.

The idea, which represents a policy change for the administration, is portrayed as a way to inject liquidity into the stretched mortgage market.

Paulson said the change involving jumbo loans could occur only in tandem with tighter oversight of the two government-sponsored mortgage companies, according to a person familiar remarks the secretary was to deliver to a House hearing Thursday.

-cut-

Paulson was to tell lawmakers "there's little question" that allowing the companies to buy the large loan "would give a short-term lift" to the mortgage market.

-cut-

Democratic lawmakers have clamored for such a change for weeks, though the regulators' action — which allows Fannie Mae and Freddie Mac to take on about 2 percent more debt — did not go as far as they, or the companies, had hoped.

The Office of Federal Housing Enterprise Oversight, which oversees Fannie Mae and Freddie Mac, last month turned down Fannie Mae's request for a 10 percent lift of the cap on its investment holdings, now set at $727 billion.

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/paulson_mortgages

[OrangeCountyDemocrat]

58. Doesn't This TRULY Benefit Primarily The Upper Class?

The Jumbo Loan market doesn't much help the middle class, except in certain high priced areas. What percentage of loans are jumbo?

[KoKo]

62. CNBC Commentator says helping folks get Jumbo Loans is good for the Economy

:eyes:

[Roland99]

72. Notice how JP Morgan and Bear Stearns report big drops in earnings but Goldman Sachs is way up?

Coincidence?

[cosmicdot]

107. Yahoo moved the article

why do they do that? .. the Paulson considering mortgage change

link is now

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/paulson_mortgages_8


the other link now goes to:

Bernanke assures Hill on mortgage hit

By JEANNINE AVERSA, AP Economics Writer Thu Sep 20, 11:49 AM ET

WASHINGTON - Federal Reserve Chairman Ben Bernanke told Congress Thursday the credit crisis has created "significant market stress" and offered fresh assurances that regulators would take steps to curb fallout related to the mortgage mess. ~snip~

[ozymandius]

8. Chinese government freezes some prices

BEIJING - China's government has ordered some prices frozen and told officials to closely monitor others in its most drastic step yet to contain a surge in inflation.

The order, issued by six government agencies late Wednesday, came after inflation rose to 6.5 percent in August — its highest monthly rate in 11 years — propelled by a double-digit rise in food prices, including pork, the country's staple meat.

The statement stressed the importance of maintaining "market stability" ahead of a key Communist Party meeting next month. It said controlling inflation would affect China's development, reform and stability.

Beijing's immediate worry is that rising consumer prices could spur public unrest. But longer term, economists say a sharp rise in the cost of wages, raw materials or energy could push up Chinese export prices, adding to inflation pressures in foreign markets or prompting buyers to switch to goods from less expensive countries.

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/china_inflation

[AnneD]

75. Morning Marketeers......

:donut: Yesterday, I talked about what the effects of the FED interest rate cut means to the falling dollar means to us. Today I want to focus on something besides the lint in my navel-ok, I am still watching my lava lamp though.

What this means to China is that the billions of dollars they hold are now less than they thought they were worth. Now maybe I am culturally stereotyping but I have never seen Asians, as a group, take to well at losing a bet in Vegas-really, seriously. I know there are gaming palaces in Singapore and Hong Kong-but what I observed by watching folks in Vegas lead me to this observation.

The Chinese will be ticked that they lost money, but even scarier is what it will do to their overheated economy. Already the farmers are upset at the disparity they see. They are neither stupid or blind to the newly rich tooling around Peking in their Buicks, Hummers, etc. And they know many of these folks own multiple homes and apartments. Their fellow countrymen that work in factories and for companies get higher wages and pensions. The farmers get nothing and their children (the traditional social security net) leave for the cities for a better life. And if you think we have problems with global warming or pollution-they have it worse. So the farmers who are already having a hard time making a living find that the government has capped their salary in the form price controls. Remember, as late as the 60's, Chinese were dying of famine. All these factors don't bode well.

Now, in the city wages are high but prices are going higher too. OK, so you can scratch out a living...but now, because of the lower value of the dollar, Chinese goods are more expensive. The raw products to produce these goodies cost more. The US buyers at Wal-Mart can't buy these goodies because the products are too expensive and their poor, working class customers can't afford them. Next thing you know, the Chinese factories are cutting shifts, hours, and finally, layoffs. As far as I know (and correct me if I am wrong) there is little if any social network for the unemployed. Our manufacturing industry has been dieing slowly. I hate to think if it started dieing over night as it might unfold in China. Talk about social upheaval.

The last time China went through farm/economic/social upheavals, culminated in the Tienanmen Square confrontation. The people in China have been leading the government reform for some time now and it will be pretty difficult to get THAT genie back into the bottle.

Who knows the outcome-but we all will be living in interesting times as they say in China.


Happy hunting and watch out for the bears.

[DemReadingDU]

81. China inflation hits 6.5%

highest rate in nearly 11 years


some examples...
Meat prices rose 49 percent in August from a year earlier, reflecting a shortage of pork, the staple meat in China. That results from a 10 percent drop in the Chinese pig population because of blue-ear disease and fast-rising feed grain costs, even as prices for pigs fell last year. Cooking oil cost 34.6 percent more in August than a year earlier, eggs were up 23.6 percent and vegetables 22.5 percent.

The latest figures raise the risk of social unrest as the Communist Party prepares for its 17th National Congress, which starts Oct. 15. The congress is held every five years to decide leadership changes.

http://www.iht.com/articles/2007/09/11/business/inflate.php

[ozymandius]

9. Morgan Stanley 3Q profit tumbles 17 pct.

NEW YORK - Morgan Stanley on Wednesday said third-quarter profit sank 17 percent, as the No. 2 U.S. investment bank was forced to write down nearly $1 billion worth of loans amid the summer's global credit crisis.

The investment bank, like others on Wall Street, was squeezed as borrowers with poor credit histories defaulted on home-loan payments at an alarming rate. This curbed investor appetite for everything from mortgage-backed bonds to loans for corporate buyouts.

It was Morgan Stanley's first drop in earnings under Chief Executive John Mack and follows a smaller-than-expected decline in profit from rival Lehman Brothers Holdings Inc. on Tuesday. But executives held out some optimism that financial markets may be starting to turn around.

-cut-

Profit fell to $1.54 billion, or $1.44 per share, from $1.85 billion, or $1.75 per share, in the year-ago period. This year's third quarter included only one month of results from Discover Financial Services, which split from Morgan Stanley in June.

Stripping out the credit-card unit, profit fell to $1.47 billion, or $1.38 per share, from $1.59 billion, or $1.50 per share. Stronger equity trading and investment banking fees helped drive revenue up to $7.96 billion from $7.06 billion a year earlier.

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/earns_morgan_stanley

[ozymandius]

10. Home Depot to shut 11 landscape stores

ATLANTA - The Home Depot Inc., the world's largest home improvement store chain, plans to close its 11 Landscape Supply stores within the next two months, a company official said Wednesday.

The closures of the five stores in the Atlanta area and six stores in the Dallas area are part of Home Depot's efforts to focus more resources on its core retail business, spokesman Ron DeFeo said.

About 380 employees will be affected by the closure of Landscape Supply. DeFeo said he did not know how many, if any, would lose their jobs. Internal job fairs will be held Friday to assist the employees in finding new positions, DeFeo said.

Home Depot's first Landscape Supply store opened in 2002. The stores catered to the specific needs of the professional customer, as well as the project-oriented do-it-yourselfer.

http://news.yahoo.com/s/ap/20070920/ap_on_bi_ge/home_depot_landscape_supply

[ozymandius]

11. Euroshares lose ground on Northern Rock, Deutsche Bank credit market woes UPDATE

LONDON, Sep. 20, 2007 (Thomson Financial delivered by Newstex) -- Europe's leading exchanges fell in morning trading as UK mortgage lender Northern Rock continued to reel from its funding woes, while Deutsche Bank (NYSE:DB) came under pressure after its chief executive said its earnings would be hit by mistakes in its handling of the crisis in the credit markets.

At 9.25 am, the Dow Jones (NYSE:DJ) STOXX 50 Index was down 38.84 points, or 1 pct at 3,791.58 while the DJ STOXX 600 fell 3.57 points, or 1 pct to 373.96.

-cut-

British members of parliament are likely to question the governor over the bank's handling of the Northern Rock crisis and the problems affecting the credit markets.

http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-19703928.htm

[ozymandius]

12. Double-digit home price drops coming

NEW YORK (CNNMoney.com) -- Over the next few years, more than three-quarters of the nation's housing markets will suffer some decline in home prices. Many will experience double-digit hits in a forecast that has worsened considerably in recent months.

According to an analysis conducted by Moody's Economy.com, declines will exceed 10 percent in 86 of the 379 largest housing markets. And 290 of the cities will experience price drops of 1 percent or more.

The survey attempted to identify the high and low points of housing prices in each of the markets, some of which started declining from their peak in the third quarter of 2005. All are median prices for single-family houses.

Nationally, Moody's is projecting an average price decline of 7.7 percent. That's a jump from the 6.6 percent total price drop that the company was forecasting in June and more than twice that of last October's forecast of a 3.6 percent price decrease.

-cut-

The Stockton, Calif., metro area, where Moody's predicts a 25 percent price drop, will be the hardest hit among the 100 most populated cities surveyed.

-cut-

Just a tick or two behind Stockton in the Moody's survey were two Florida metro areas, Palm Bay/Melbourne (down 24.9 percent) and Sarasota/Bradenton (down 24.8 percent). All three markets are on almost the same peak-to-trough schedule, with Moody's forecasting that Sarasota will bottom out in the third quarter of 2008, a quarter sooner than the other two.

http://money.cnn.com/2007/09/19/real_estate/steep_home_price_drops_coming/index.htm

[ozymandius]

13. Subprime layoffs head for record

NEW YORK (CNNMoney.com) -- If the banking industry, with its load of worries caused by the subprime meltdown, has another month like it did in August, it will be in record territory for job losses.

Last month, banks with ties to the subprime mortgage industry laid off more than 26,000 employees, the most of any month since global outplacement consultancy Challenger, Gray & Christmas began keeping such records in 1993.

Overall, that brought the total layoff damage to 107,758 in the financial industry this year. Another month that even remotely resembles recent trends will send the layoff total soaring past the 116,515 mark set during the recession of 2001.

-cut-

Banks have been laying off employees in large numbers since the beginning of the year. The two sharpest peaks came in August and in April, when 33,789 workers, most connected to the subprime industry, lost their jobs. The lowest month for layoffs was July, with 2,180.

http://money.cnn.com/2007/09/19/real_estate/subprime_layoffs/index.htm

[mainegreen]

15. I wish I was in one of those 'three-quarters of the nations markets'

This one seems to never want to come down.
I don't think its going to come down much here either.

:mad:

[ozymandius]

14. Bonddad: Housing Is Hosed and Inflation Will Increase

-posted Wednesday-

Remember that the 10-year Treasury and mortgage rates are closely tied to one another. Mortgage traders use the 10-year Treasury as a hedging tool in their portfolio. So, the value or yield of the 10-year is very important in the mortgage market.

-chart-

Notice the 10-year yield has been dropping for the better part of the last few months. The reason is simple. The Fed continually said they were more concerned with fighting inflation and bond traders believed them (see this post for a complete rundown of all FOMC statements since January).

Yesterday the Fed basically said, "while inflation is still of a concern, we're now more concerned about economic growth." By lowering rates, the Fed was making the economy more vulnerable to inflation. This eats away at fixed income streams, so traders sell the 10-year Treasury. Because a bond's price and yield are inversely related, yields now move up -- which starts to increase mortgage rates.

-chart-

As this weekly chart of the 10 year Treasury shows, yields are at a technically important point. Yields have been coming down (so prices are have been moving up). At this point, traders are simply looking for a reason to sell -- the Fed gave them one. The US economy is now more vulnerable to inflation thanks to yesterday's rate cut.

And today's CPI report notwithstanding, there is great cause to be concerned about commodity inflation right now.

http://bonddad.blogspot.com/2007/09/housing-is-hosed-and-inflation-will.html

[whistle]

16. Word on the street is that real inflation is 10% and rising every day

[roamer65]

24. It is 10% or more.

Great website that shows the real data.

http://www.shadowstats.com


We are in an inflationary recession/depression, but most don't realize it yet.

[ozymandius]

17. Have a great day folks.

:donut: :donut: :donut:

I am away - hoping to make a few pennies. I'll check back this afternoon.

Ozy :hi:

[Kolesar]

18. "The rate cut is working, and the surge is working, too! "

"So what we need you Americans to do is to shopping."

But seriously, folks. We have had a long period where the trade deficit is soaring (China & petro), "the government" has been increasing the money supply, the dollar lost all the value it had gained against the Euro, the Loonie is at 1:1 parity, and now the Federal Reserve gives us the biggest rate cut imaginable. Looks like a recipe for inflation. The price of oil is climbing; that tells me that the price of a barrel of petroleum is "practically" set in Euros.

The last powerful driver of the US economy, new home construction, has hit a wall, and it has been years since 0.0% financing created robust auto sales.

Does anybody think that the 1/2% rate cut is going to put new construction back on track? Or are we out of troops?

[skids]

19. Good Morning Market Folksen

A few weeks ago a bug decided to do the death tango with my windsheild. I don't know what the deal was with this bug, but it sure had guts. Gooey gluey guts. I'm too lazy to do things by hand so I just sort of sat there annoyed while ever so slowly between wiper fluid and rain eventually, invisibly, the glass became clear, yesterday.

Just in time for some sort of weird spawning event, perhaps triggered by the absurd drop to near freezing temperatures the last few days followed by the resumption of normal September temps. I think there might have been some sort of turbulence
that was making them fly lower than normal -- bugs everywhere, all headed for my windshield. Too many to wipe away. All with "a hardened resolve" in their belly.

Now usually when things like this happen, they just happen to me, but as I drove along noticing all the other drivers likewise spraying away in futility that I was convinced this was, for once, not some sort of karmic conspiracy to drive me completely out of my bean.

I have no doubt, to the bugs, I-90 is now considered the site of a historic atrocity.

And I could not help but think of the traders.

Because when you think about it, just as bugs cannot see very far, ordinary traders do not have the sensory organs to "perceive" the market. And just as bugs have very simple brains that amount to nothing but a sundry pile of logic gates, so too do even the most sophisticated traders steer by simple algorithms and arbitrary instinct. The market has its moths to the flame, its mayflies, its swarms, its migration patterns -- and its windy days in strange territory near a highway of speeding windshields.

It all made too much sense for comfort. Maybe there's even a holistic connection there.

Anyway, good hunting folksen, fly high, stay near the treetops, and watch out for bats.

[Roland99]

31. Boiler Room has been so aptly played this past month on HDNet Movies

:)

[UpInArms]

40. "ordinary traders do not have the sensory organs to "perceive" the market"

nice post with great prose :D

thanks!

[UpInArms]

20. dollar watch (with answers to yesterday's questions)

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

Last trade 78.834 Change -0.499 (-0.63%)

Settle Time 15:01 Open 79.300

Previous Close 79.333 High 79.308

Low 78.791 2007-09-20 07:22:56, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.091 52wk Low Date 2007-09-19

What is Up Next for the US Dollar Post FOMC?

http://www.dailyfx.com/story/bio1/What_is_Up_Next_for_1190236745427.html

What is Up Next for the US Dollar Post FOMC?
The Federal Reserve’s interest rate decision has come and gone and even though the impact on the financial markets has been substantial, the consolidation today indicates that traders are asking, What’s Next? With the EUR/USD hovering below 1.40, everyone is wondering whether it will break that level and if so, what could trigger it. The rest of the economic data due for release this week are not very market moving since we only have the Philly Fed survey and leading indicators left on the calendar. However don’t rule out a break and test of 1.40 this week. We have testimonies by Fed Chairman Ben Bernanke and US Treasury Secretary Paulson tomorrow on the state of the mortgage market. The Fed’s decision yesterday received widespread applause from both Democrats and Republicans. It would not be a stretch to say that the upcoming testimony was a factor in Bernanke’s decision to make a more aggressive cut of the Fed funds and discount rate. Had he opted for a more conservative quarter point cut, we are sure that he would receive tough criticism instead of compliments by Congress tomorrow. Today’s weaker than expected consumer price and housing market reports have had little impact on the currency market. Softer gasoline prices in the month of August have eased inflationary pressures around the world. Oil prices did not climb to record highs until September which means that today’s CPI number may not be an accurate reflection of current inflationary pressures. As for housing, we all know that the housing market is doing poorly. These numbers simply validate the Fed’s decision to ease monetary policy more aggressively. Although the rate cut goes a long way to relieving the risks of a recession, it does not rule out one. We still need to see how non-farm payrolls and retail sales fare in the months forward to determine whether US growth could still slow materially. The futures curve is currently pricing in 50bp of easing before the end of the year. With only two more rate decisions on the calendar, we expect 25bp rate cuts in October and December. Another half point cut may not be entirely out of the question if economic data remains weak since the Fed has cut rates by half point clips on multiple occasions in 2001.

Stocks Continue Higher but Carry Trades Fail to Follow
The Dow rallied another 80 points today but Japanese Yen crosses failed to track US equities higher. This price action indicates that traders are cautious and do not want to get overly optimistic. Over the past few months, they have been burned by the problems in the subprime sector. Traders and investors have learned about the consequences of aggressive risk appetite the hard way. Before carry trades even have a chance to return to the multi-decade highs that was characteristic of the first of the half the year, there needs to be proof that the US economy has stabilized and the worst is behind us. At bare minimum, the number of foreclosures and defaults on home loans need to fall and not rise. It is no secret that the outlook for the US economy is a far bigger driver of Yen movements than Japanese economic data. For example, the Bank of Japan left interest rates unchanged last night and even though the Japanese Yen actually rallied in the hours following the monetary policy decision.

...more...

Saudi Arabia Refuses To Follow Fed's Cut, Will They Break The Peg?

http://www.dailyfx.com/story/dailyfx_reports/daily_brief/Saudi_Arabia_Refuses_To_Follow_1190288414538.html

In the midst of a busy economic calendar, one unscheduled event finally broke through the dollars defenses. The dollar was hammered by news that the Saudi Arabia Monetary Authority would not cut rates to follow the Fed’s 50 bp easing on Tuesday. This is the first time the central bank has not kept pace with US rates and its defiance sparked fears that the country was preparing to abandon its peg with the dollar. If the world’s largest oil exporter were to break the peg, it would certainly be a hit for the greenback which has already seen its reserve currency status shaken with China and Russia, among others nations, diversifying away from the dollar. As the news weighed on the market, EURUSD was able to finally break the targeted 1.40 level (see Antonio Sousa’s and Jamie Saettele’s articles calling for the move).

While the euro’s fresh record highs may have been the headline for the night , it certainly wasn’t the only story. In fact, the British pound had arguably the most fundamentally active sessions. Retail sales crossed the wires with gusto on a 0.6 percent jump over August that flouted expectations of no change. Certainly, strong employment trends and high housing values helped to carry consumer optimism through the July rate hike; but generous discounts - which have seen the price deflator drop 1.0 percent over the year - undoubtedly helped stoke demand. If that is the case, the push and pull between record debt along with rising rates and price discounts can only last so long before pricing managers find their limit.

Speaking of debt and interest rates, BoE Governor Mervyn King delivered his testimony on the Northern Rock situation to the Treasury Select Committee. King said the events of last week concerned policy makers that confidence in the banking system was eroding. However, while he said the trade off between limiting moral hazard and stable markets was forced; the Governor said he would have preferred a change of ownership or covert lender of last resort (LOLR), but legislation prevented these options. And, while the central banker said he would inject an additional 10 billion pounds into the market, he gave no clear indication that rate cuts were on the way.

Looking ahead to the US session, the clear market-moving event will be Fed Governor Ben Barnanke’s and Treasury Secretary Henry Paulson’s testimony before the House’s Financial Services Committee. The American policy makers will likely face the same heat that King felt in his grilling; and we can expect both men to defend their actions vigorously. It will be interesting to see how Bernanke presents himself after losing the respect of many inflation hawks when he voted along with his fellow Board of Governors to take the Greenspan-like action of cutting the Fed Funds rate half a percent, rather than a quarter or no move at all.

...more...

(edited to clean up my html)

[KayLaw]

22. Thank you, UpInArms

To me, that article about Saudi Arabia is a huge story.

[UpInArms]

36. you're welcome, KayLaw

I'm sorry I couldn't get back to the thread yesterday - there are some days that I just don't seem to have two minutes to rub together.

[AnneD]

79. I would't be shocked ......

If you think the dollar is down the toilet now, it will be sewer surfin' once it is no longer pegged to oil.

[TalkingDog]

29. Deleted: My brain is stuck on Monday

Sorry










My Favorite Master Artist: Karen Parker GhostWoman Studios

[UpInArms]

44. Euro breaches $1.40 against the dollar for the first time

http://www.marketwatch.com/news/story/euro-breaches-140-against-dollar/story.aspx?guid=%7B893BB858%2DAE65%2D48C6%2DAA7A%2DF06DB1D78631%7D&dist=TNMostRead

LONDON (MarketWatch) -- The euro rose over $1.40 for the first time ever and sterling traded over $2 against the greenback on Thursday morning. A report in the Daily Telegraph newspaper noted that that Saudi Arabia has refused to cut interest rates in tandem with the U.S. Federal Reserve for the first time, which it said suggests the kingdom is preparing to break the dollar currency peg. This move "risks setting off a stampede out of the dollar across the Middle East" the report said. Recently, the euro rose 0.4% at $1.4025 and sterling traded up 0.1% at $2.0029.

[UpInArms]

57. dollar gives sign of the devil - @ 78.666

Last trade 78.666 Change -0.667 (-0.84%)

Settle Time 15:01 Open 79.300

Previous Close 79.333 High 79.308

Low 78.660 2007-09-20 10:26:36, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.091 52wk Low Date 2007-09-19

[UpInArms]

77. dollar continues to crater - now down 1.09%

Last trade 78.469 Change -0.864 (-1.09%)

Settle Time 15:01 Open 79.300

Previous Close 79.333 High 79.308

Low 78.465 2007-09-20 11:44:41, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.091 52wk Low Date 2007-09-19

[UpInArms]

21. PIEHOLE ALERT: Bush to make unspecified Rose Garden announcement at 9:30 ET

huh?

[Theres-a]

23. Ack. Now what.

Thanks for this thread all of you----
-- a lurker:D

[UpInArms]

37. g'morning, there-s a

lurk and post away!

:hi:

[spotbird]

30. Bomb, bomb, bomb,

bomb, bomb, Iran?

[UpInArms]

32. Bush schedules press conference for 10:45 a.m. ET

07. Bush schedules press conference for 10:45 a.m. ET
9:10 AM ET, Sep 20, 2007 - 10 minutes ago

[UpInArms]

56. Bush: U.S. economic fundamentals are 'strong'

02. Bush: U.S. economic fundamentals are 'strong'
10:51 AM ET, Sep 20, 2007 - 3 minutes ago

[Roland99]

71. He just forgot to mention that "fundamentals" = Fed pumps.

And, yeah, those pumps are STRONG!

[UpInArms]

61. Bush: 'I don't comment on actions' of the Federal Reserve

01. Bush: 'I don't comment on actions' of the Federal Reserve
11:05 AM ET, Sep 20, 2007 - 31 seconds ago

[UpInArms]

64. Bush says he disagrees with Greenspan on fiscal record

01. Bush says he disagrees with Greenspan on fiscal record
11:07 AM ET, Sep 20, 2007 - 4 minutes ago

02. Bush: Fed's Bernanke is 'doing a fine job'
11:06 AM ET, Sep 20, 2007 - 5 minutes ago

[UpInArms]

65. Delusion Bush: 'I'm a strong asset' to Republicans in '08 elections

01. Bush: Worried about signs of 'protectionism,' 'isolationism'
11:13 AM ET, Sep 20, 2007 - 1 minute ago

02. Bush: 'I'm a strong asset' to Republicans in '08 elections
11:13 AM ET, Sep 20, 2007 - 1 minute ago

[AnneD]

86. Our theme today.......

Dedicated to the GOP

Ain't no holla back girl By Gwen Stephani (who follows her own beat)

huh,this my shit
All the girls stomp your feet like this

Few times I've been around that track
So it's not just gonna happen like that
'Cause I ain't no holla back girl
I ain't no holla back girl
<2x>


<snip>
I heard that you were talking shit
And you didn't think that I would hear it
People hear you talking like that, getting everybody fired up
So I'm ready to attack, gonna lead the pack
Gonna get a touchdown, gonna take you out
That's right, put your pom-poms down, getting everybody fired up

<snip>
So that's right dude, meet me at the bleachers
No principals, no student-teachers
Both of us wanna be the winner, but there can only be one
So I'm gonna fight, gonna give it my all


Gonna make you fall, gonna sock it to you
That's right, I'm the last one standing, another one bites the dust

<snip>


You go Bush-just keep on going. Between Bush and Dick-the GOP and the whole nation has been screwed.:eyes:

[ozymandius]

99. Bush: I hold a sign that reads 'Get It Here'

I'm sure he is a great asset. Vitter and Craig say so.

[roamer65]

25. The loonie is oh, so close to parity.

http://www.xe.com

[UpInArms]

41. Canadian dollar hits parity with U.S. dollar - 9:47 AM ET, Sep 20, 2007

02. Canadian dollar hits parity with U.S. dollar
9:47 AM ET, Sep 20, 2007 - 5 minutes ago

[UpInArms]

42. Canadian dollar hits parity with U.S. dollar - not happened since the 1970s

http://www.marketwatch.com/news/story/canadian-dollar-hits-parity-us/story.aspx?guid=%7BAE68FFC4%2D1E4E%2D4BD8%2DA205%2D026927757059%7D&dist=hplatest

NEW YORK (MarketWatch) -- The Canadian dollar reached one-to-one parity with the U.S. dollar in early Thursday trade. It marked the first time the Canadian unit has seen that level since the 1970s. The greenback has fallen significantly against many major currencies since the U.S. Federal Reserve moved to cut the federal funds target Tuesday.

[UpInArms]

27. Gold rises sharply, as dollar hits new low vs. euro

http://www.marketwatch.com/news/story/gold-rises-sharply-dollar-hits/story.aspx?guid=%7B1375D76F%2DAD48%2D47C0%2DAA59%2DC7FD3A86404D%7D&dist=hplatest

NEW YORK (MarketWatch) -- Gold futures rose sharply early Thursday, buoyed by the dollar's fall to a new all-time low against the euro. Gold for December delivery surged $8.50, or 1.2%, at $738 an ounce on the New York Mercantile Exchange. "Gold prices have risen further, as the dollar fell below 1.40 against the euro and oil prices remain high," said analysts at Action Economics. "A weakening dollar makes gold more attractive for holders of other currencies and as a hedge against inflation."

[UpInArms]

34. December gold up $11.30 at $740.80 an ounce on Nymex

15. December gold up $11.30 at $740.80 an ounce on Nymex
9:03 AM ET, Sep 20, 2007 - 25 minutes ago

[UpInArms]

47. Gold futures climb past $740 in morning dealings (trading at levels not seen since 1980)

http://www.marketwatch.com/news/story/gold-futures-climb-past-740/story.aspx?guid=%7BB9A1D9F4%2DD661%2D42A4%2DA186%2D3CA548347279%7D&dist=morenews

SAN FRANCISCO (MarketWatch) -- December gold was last up $13.50 at $743 an ounce on the New York Mercantile Exchange, trading at levels not seen since 1980. "Given increasing uncertainty regarding the health of the U.S. economy and the U.S. , it seems extremely likely that gold will challenge the inflation-adjusted high of $2,400 in the next 5 years," said Mark O'Byrne, director at GoldandSilverInvestments.com.

hmmmm..... weren't we having double-digit inflation back then :think:

[UpInArms]

28. Mattel's CEO faces skeptical lawmakers

http://news.yahoo.com/s/nm/20070920/bs_nm/mattel_safety_dc

WASHINGTON (Reuters) - Mattel CEO Robert Eckert (MAT.N) defended his company's toy safety record on Wednesday as two skeptical Democratic lawmakers accused him of stonewalling a congressional probe into production practices in China linked to millions of recalled toys.

Eckert told a House Energy and Commerce subcommittee that his company was aggressively testing toys to make sure they were safe, and said employees will make more surprise inspections of factories.

"I can assure this committee that we'll share with other toy companies what we've learned to help improve industry practices overall," Eckert said in testimony.

Mattel, the world's largest toy maker, has come under scrutiny following the recall of about 21 million of its Chinese-made toys in a span of five weeks, many because of excessive levels of lead paint.

On Tuesday, the subcommittee released a letter from Mattel disclosing that the recent recalls included one toy that had nearly 200 times the amount of lead in paint allowed under U.S. law.

...more...

[UpInArms]

33. Chopper Ben spreads gloom and doom

15. Fed will act to foster price stability, growth: Bernanke
8:56 AM ET, Sep 20, 2007 - 24 minutes ago

16. Bernanke opposes raising loan limit for Fannie, Freddie
8:53 AM ET, Sep 20, 2007 - 27 minutes ago

17. Raising lenders' underwriting practices important: Bernanke
8:49 AM ET, Sep 20, 2007 - 31 minutes ago

18. Fed working with groups to reduce foreclosure risk: Bernanke
8:48 AM ET, Sep 20, 2007 - 32 minutes ago

19. Market for subprime-mortgages has adjusted sharply: Bernanke
8:47 AM ET, Sep 20, 2007 - 33 minutes ago

20. Markets 'tend to self-correct,' Bernanke says
8:45 AM ET, Sep 20, 2007 - 35 minutes ago

21. Foreclosures, delinquencies to rise further, Bernanke says
8:44 AM ET, Sep 20, 2007 - 37 minutes ago

36. Embargo on Bernanke remarks broken, CNBC says
8:15 AM ET, Sep 20, 2007 - 1 hour ago

[UpInArms]

43. Bernanke predicts further mortgage turmoil

http://www.marketwatch.com/news/story/fed-chief-bernanke-predicts-further/story.aspx?guid=%7B2D9C1931%2DF3EB%2D4B80%2DBE88%2DF7423A7EF64E%7D&dist=sp_inthis

WASHINGTON (MarketWatch) -- More delinquencies and foreclosures can be expected in the subprime, adjustable-rate mortgage market as borrowers face interest-rate resets, Federal Reserve Chairman Ben Bernanke said Thursday.

In prepared testimony to the House Financial Services Committee, Bernanke also said the market for those mortgages has "adjusted sharply," and that markets "do tend to self-correct."

He outlined steps the Fed is taking to help reduce the risk of foreclosure and stressed the need to beef up underwriting practices.

Just two days after the Fed lowered the federal funds rate by 50 basis points, Bernanke also said the central bank stands ready to foster price stability and sustainable economic growth.

"Recent developments in financial markets have increased the uncertainty surrounding the economic outlook," Bernanke said. "The committee will continue to assess the effects of these and other developments on economic prospects and will act as needed to foster price stability and sustainable economic growth," he said.

...more...

[hatrack]

46. No shit, Ben! Wish I had a degree in economics!

:eyes:

[UpInArms]

76. Chopper Ben works on incomprehensive speaking skills

02. Bernanke says federal guidelines for hedge funds worked
12:03 PM ET, Sep 20, 2007 - 3 minutes ago

03. Bernanke: Fed to keep reassessing economic outlook
11:53 AM ET, Sep 20, 2007 - 13 minutes ago

04. Bernanke: Rate cut designed 'to get out ahead' of turmoil
11:52 AM ET, Sep 20, 2007 - 14 minutes ago

05. Bernanke: Overall objective is to make economy stable
11:39 AM ET, Sep 20, 2007 - 27 minutes ago

[UpInArms]

35. Fed Pumping Early: Fed adds $7.0 bln in reserves through 14-day repos

http://www.reuters.com/article/bondsNews/idUSNYG00075220070920

NEW YORK, Sept 20 (Reuters) - The U.S. Federal Reserve said on Thursday it added $7.0 billion of temporary reserves to the banking system through 14-day repurchase agreements.

Collateral accepted for the 14-day repos was made up of $6.329 billion of mortgaged-backed securities and $671 million of Treasuries. A total of $56.50 billion in bids were submitted.

Fed funds rates traded steady at 4.75 percent, matching the fed funds target rate.

Chopper Ben will make this market so "liquid", it will look like diarrhea

[UpInArms]

38. Bear Stearns net tumbles 61 percent

http://www.reuters.com/article/bondsNews/idUSWNAS449320070920

NEW YORK (Reuters) - Bear Stearns Cos Inc (BSC.N: Quote, Profile, Research) said on Thursday quarterly profit plunged 61 percent to its lowest level in five years on bad bets on subprime mortgages and disrupted fixed-income trading.

The U.S. investment bank's profit badly missed the estimates of analysts after the collapse of two hedge funds triggered about $200 million in losses. Industry giant Goldman Sachs Group Inc (GS.N: Quote, Profile, Research), meanwhile, thrived where Bear Stearns stumbled, posting a 79 percent gain in profit.

Seen as a leader in packaging home loans into mortgage-backed bonds, Bear Stearns' bread-and-butter business, fixed-income, saw its revenue plunge 88 percent to $118 million.

"They were definitely hurt by the mortgage problems and credit markets," said Meg McMullen, president of Boston's New England Research & Management. "And they are the least diversified among the major investment banks."

...more...

[UpInArms]

50. Hedge-Fund Losses Hurt Bear Stearns

http://online.wsj.com/article/SB119029258173033824.html?mod=MKTW

Bear Stearns Cos. posted a 61% drop in fiscal third-quarter net income on big hedge-fund losses that helped fan the ongoing credit-market woes.

The company also announced a new $2.5 billion stock-buyback plan, supplanting a prior program under which $700 million could still have been purchased.

For the quarter ended Aug. 31, the brokerage house posted net income of $171.3 million, or $1.16 a share, compared with $437.6 million, or $3.02 a share. The company said the result include nearly $200 million in losses and expenses related to the two hedge funds that imploded this summer.

Net revenue, or total ...

• THE FULL WSJ.com ARTICLE IS ONLY AVAILABLE TO SUBSCRIBERS.

[UpInArms]

68. Bear Stearns may cut more subprime jobs

http://www.reuters.com/article/bondsNews/idUSWEN116020070920

NEW YORK, Sept 20 (Reuters) - Bear Stearns Cos Inc (BSC.N: Quote, Profile, Research) said on Thursday it may cut more jobs at its subprime mortgage operations.

"My guess is that we will continue to trim headcount there," Bear Stearns Chief Financial Officer Sam Molinaro said on a conference call.

...a bit more...

[Buttercup McToots]

39. USD $78.68 @ 9:45 am

:wow:

[DemReadingDU]

48. 9/4/92 USD $78.19

The all-time low for the DXY was set in September 4, 1992 at 78.19


two charts -- the first is of the Long Bond continuous futures contract. The second is of the Dollar Index. They illustrate the price action in both of these markets over the past three days. Keep in mind the Fed announcement came out at 2:15 p.m. or so on the 18th ...

http://interestrateroundup.blogspot.com/2007/09/watch-that-dollar-and-watch-those-long.html

[Buttercup McToots]

54. USD $78.60 @ 10:45 am

:popcorn:

[Buttercup McToots]

67. USD $78.46 @ 11:30 am

How low?
:crazy:

[Buttercup McToots]

73. USD $78.41 @ 12:00 am

!!!:thumbsdown:

[Buttercup McToots]

78. USD $78.37 @ 12:20 am

!!

[DemReadingDU]

84. am?

:eyes:

[Roland99]

85. Hope ol' Buttercup isn't picking up the flu bug I am just now shedding off...

;)

[Buttercup McToots]

89. ooops...

I was so excited by the rise of gold...:bounce:

No flu here yet, Dem...thank goodness...
Ye better now?
:hug:

[Roland99]

90. Dunno about Dem but I'm at least back to work

[UpInArms]

49. Treasurys continue drop as weak dollar fans inflation fears

http://www.marketwatch.com/news/story/treasurys-continue-drop-weak-dollar/story.aspx?guid=%7B66E9CE25%2DA487%2D438C%2D8071%2DCC4945E280D5%7D&dist=morenews

SAN FRANCISCO (MarketWatch) -- Treasurys continued to fall Thursday, pushing yields higher, as the dollar's drop against most major currencies and recently high oil prices kept alive investors' worries about inflation in the wake of the U.S. Federal Reserve's interest rate cuts on Tuesday. The benchmark 10-year Treasury note was down 13/32 at 101 8/32, with a yield ($TNX: 45.99, +0.75, +1.7%) of 4.593%, up from 4.526% in late U.S. trading Wednesday. The 30-year long bond was down 22/32 at 101 29/32 with a yield ($TYX: 48.83, +0.59, +1.2%) of 4.877%, up from 4.825% Wednesday. The two-year note was down 2/32 at 99 30/32 with a yield of 4.033%, up from 3.982%.

[TrogL]

51. LOONIE WATCH - SPECIAL REPORT

Highlights

Current:



30-day and 90-day vs.greenback:



30-day vs. Euro, Yen, UK Pound and Swiss Franc




Currency Comparison: http://members.shaw.ca/trogl/looniewatch.html

Detailed analysis: http://quotes.ino.com/exchanges/?r=CME_CD

Up-to-the-minute graph: http://quotes.ino.com/chart/?s=CME_CD.Y%24%24&v=s&w=5&t=l&a=1

Historical values http://www.x-rates.com/d/USD/CAD/data30.html

2007-08-20 Monday, August 20 0.94518 USD
2007-08-21 Tuesday, August 21 0.943307 USD
2007-08-22 Wednesday, August 22 0.94162 USD
2007-08-23 Thursday, August 23 0.946432 USD
2007-08-24 Friday, August 24 0.950119 USD
2007-08-27 Monday, August 27 0.951022 USD
2007-08-28 Tuesday, August 28 0.941974 USD
2007-08-29 Wednesday, August 29 0.944109 USD
2007-08-30 Thursday, August 30 0.946342 USD
2007-08-31 Friday, August 31 0.94697 USD
2007-09-03 Monday, September 3 0.94697 USD
2007-09-04 Tuesday, September 4 0.953016 USD
2007-09-05 Wednesday, September 5 0.951656 USD
2007-09-06 Thursday, September 6 0.949307 USD
2007-09-07 Friday, September 7 0.948227 USD
2007-09-10 Monday, September 10 0.949487 USD
2007-09-11 Tuesday, September 11 0.958773 USD
2007-09-12 Wednesday, September 12 0.964134 USD
2007-09-13 Thursday, September 13 0.968617 USD
2007-09-14 Friday, September 14 0.971628 USD
2007-09-17 Monday, September 17 0.970214 USD
2007-09-18 Tuesday, September 18 0.977135 USD
2007-09-19 Wednesday, September 19 0.985513 USD


Current values

Loonie:

Last trade 0.9992 Change +0.0126 (+1.28%)
Previous Close 0.9868 Open 0.9990
Low 0.9979 High 1.0005


Other combinations:

AS.U07 AUSTRALIAN $/CANADIAN $ Sep (NYBOT) 0.8626 -0.0048
HY.U07 CANADIAN $/JAPANESE YEN Sep (NYBOT) 122.12 +0.44
RA.U07 EURO/AUSTRALIAN $ Sep (NYBOT) 1.65200 +0.00485
GB.Z07 EURO/BRITISH POUND Dec (NYBOT) 0.7021 +0.0017
EP.Z07 EURO/CANADIAN $ Dec (NYBOT) 1.40700 -0.01015
EJ.U07 EURO/JAPANESE YEN Sep (NYBOT) 159.92 +0.14
EU.U07 EURO/US$ (LARGE) Sep (NYBOT) 1.3876 +0.00001


Blather (from http://quotes.ino.com/exchanges/?r=CME_CD)

The December Canadian Dollar closed higher on Wednesday as it extends this month's rally and the high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. December continues to extend this month's rally into new uncharted territory making upside targets hard to project. Closes below the 10-day moving average crossing at .9665 would confirm that a short-term top has been posted. First resistance is today's high crossing at .9874. First support is Tuesday's gap crossing at .9757 then broken resistance marked by July's high crossing at crossing at .9689.

Analysis

:bounce::bounce::bounce::bounce::bounce::bounce::bounce::bounce::bounce:
:party::party::party::party::party::party::party::party::party:

:bounce: WE HIT PARITY :bounce: WE HIT PARITY :party: WE HIT PARITY :bounce: WE HIT PARITY :bounce:
:bounce: WE HIT PARITY :bounce: WE HIT PARITY :party: WE HIT PARITY :bounce: WE HIT PARITY :bounce:
:bounce: WE HIT PARITY :bounce: WE HIT PARITY :party: WE HIT PARITY :bounce: WE HIT PARITY :bounce:
:bounce: WE HIT PARITY :bounce: WE HIT PARITY :party: WE HIT PARITY :bounce: WE HIT PARITY :bounce:

:party::party::party::party::party::party::party::party::party:
:bounce::bounce::bounce::bounce::bounce::bounce::bounce::bounce::bounce:

...

...


errr, I'll post something more coherent when I've settled down a bit.

:popcorn:

[TrogL]

52. The partying begins (maybe a bit early)

(this is a bit stale)

http://www.cbc.ca/money/story/2007/09/20/canadiandollar.html

The Canadian dollar continued its march towards parity with the U.S. greenback on Thursday as it gained more than a cent to hit 99.99 cents US.

Several financial data providers flashed that the loonie had reached parity around 9:15 a.m. ET, but the Bank of Canada confirmed at 10 a.m. ET that its trading room had not seen any trades at parity.

The loonie has not been at parity with its U.S. counterpart since November 1976.

http://www.canada.com/story.html?id=ab4bc655-0d86-402f-b464-512348d6c6b3&k=9609

The Canadian dollar rose as high as US99.99 cents in early trading on Thursday, something that hasn't happened since the end of November, 1976.

Bids on the dollar were calling for par around 9:23 a.m., but the dollar ultimately fell back a few hundredths of a cent. By 9:40 a.m., it was trading at US99.97 cents.


The greenback sunk to a record low against the euro, a signal of the U.S. currency's weakness around the world. Gold hit a record high of US$730.25 an ounce, also due to weakness in the U.S. dollar. Gold is bought and sold in U.S. dollars, so a weaker dollar makes bullion cheaper for foreign investors.

http://www.reportonbusiness.com/servlet/story/RTGAM.20070920.wdollar0920/BNStory/robNews/?page=rss&id=RTGAM.20070920.wdollar0920

Loonie flirts with parity (emphasis added)

The Canadian dollar traded as high as 99.99 cents (U.S.) on Thursday morning, a hairbreadth's away from parity.

The currency has seen bids at parity already this morning, but no trades yet, currency traders said.

...

This year alone, the Canadian dollar has soared 16 per cent against the greenback, the strongest performance of any G-10 country.

http://www.theglobeandmail.com/servlet/story/RTGAM.20070920.wparityqa0920/BNStory/Front

Avery Shenfeld on parity

What are the two most important reasons it has done so?

In part, it's a case of a rising tide lifting all boats, as disfavour with the U.S. dollar, tied to America's trade deficit, pushed up the currencies of its trading partners. But Canada's ability to stay with the pack owes largely to a huge move in commodity prices in the past few years, which not only increased foreign demand for our currency, but also created the income and employment growth needed to offset the hit to non-resource exporters.

...

What impact will parity have on Canadian economic growth?

It part, we've only reached parity because our economy has been able to stay near full employment despite the negative impacts on growth from the loony's climb since 2002. So parity reflects the reality of decent growth prospects, while in and of itself serving to restrain growth in exports. The Bank of Canada wanted to see a slowdown to 2½% growth to cool the inflation threat, so in the end, the drag from the currency is only substituting for the drag we would have otherwise felt from even higher interest rates.

Lots more good stuff on economic impact.

[Tiberius]

53. Good morning marketeers.

Long time lurker here. I usually don't post because I have been a very long term, buy and hold investor... until now.

I placed a small portion of my nest egg in a futures account, and I'm shorting this market. It boggles my mind that the stock market is holding up with all the turmoil out there.

[AnneD]

100. Welcome Tiberius...

:hi: I am a long term investor by nature (the buy and hold type), but this has not been an attractive market for a while now. I thought people would have wised up earlier but I think some folks are wising up and will be pulling out to watch for a while.

A good well run company is always a bargain when you can find them.

[ozymandius]

103. Welcome Tiberius.

Nice to have you along.

As a lurker - you may well know by now that our financial world is swayed by "deus ex machina".

[UpInArms]

59. UPDATE 1-C$ hits par with greenback, first time since 1976

http://www.reuters.com/article/bondsNews/idUSN2037598220070920

TORONTO, Sept 20 (Reuters) - The Canadian dollar reached
parity with the U.S. currency for the first time in 31 years on
Thursday, according to Reuters data, supported by lofty
commodity prices, a strong domestic economy and concerns about
a U.S. economic slowdown.

The Canadian currency has been threatening parity for most
of 2007, but a number of factors have aligned recently to give
it a boost to the key level, including recent rate cuts in the
United States.

<snip>

The Canadian dollar, also known as the loonie, has rallied
more than 60 percent since dropping below 62 U.S. cents in
2002, driven largely by the broadly weakening U.S. currency,
and by soaring oil and metals prices, which have fueled
Canada's resource-heavy economy.

...a bit more at link...

[Roland99]

70. wow. Just... WOW.

[TrogL]

55. Canadian dollar heading for US$1.05, Mersch says

(messing with commas)

http://www.canada.com/nationalpost/financialpost/story.html?id=06420718-883b-471e-b285-9b1314d09089&k=22833

"Fundamentally this country is head and shoulders above the United States on an economic basis."
Jonathan Chevreau, Financial Post
Published: Wednesday, September 19, 2007

After Frank Mersch left Altamira and became a co-owner of hedge fund firm Front Street Capital, his public appearances and statements to the media became relatively rare. On Tuesday night, Mersch gave an hour-long off-the-cuff talk at Toronto's Granite Club at a dinner sponsored by DOT Integrated Financial. Before the talk, he gave the following interview to the FP's Jonathan Chevreau about the loonie's rise to parity. This is an edited excerpt:

JC: Do we hit parity this week?

FM: We're looking at parity within the next couple of weeks and I think we go to US$1.05.


This is an excellent analysis of the world economic situation with a focus on the fundamentals of Canada's economy, how it fits into the world picture and what's gone wrong with the greenback. A lot of it's over my head.

[TrogL]

60. UPDATE - WE'RE BACK AT PARITY (sort of)

(formatting)

Loonie:

Last trade 1.0001 Change +0.0135 (+1.37%)
Previous Close 0.9868 Open 0.9990
Low 0.9979 High 1.0005


Analysis

Here's the problem. I normally use the value published by the main site I link to, quotes.ino.com, and they generally quote the future market for the upcoming quarter. At the moment it's well into beyond-parity territory.

Here, however, are the "cash" values from a different chart (http://quotes.ino.com/chart/?s=CME_CD.Y%24%24&v=s&w=5&t=l&a=1).

Last trade 0.9995 Change +0.0132 (+1.34%%)
Previous Close 0.9863 Open 0.9966
Low 0.9966 High 0.9995


To keep everything straight, I'll continue to post my normal numbers in the regular thread, and I'll post a special "WE JUST HAD A CASH TRADE AT PARITY" when (I'm not even going to bother with "if") that happens.

[TrogL]

87. Why we may be having a problem hitting parity in the cash market

(speeling)

I don't have specific links for this, I'm still trying to pull all this together.

One of the problems with hitting parity is programmed trading. We've run into this kind of thing before when computerized trading first started. The bot was programmed to make certain decisions based upon market conditions and perform actions automatically without human intervention. The problem is that a program is only as good as its programmer. Back in the mists of time, one of the big stock market crashes was caused by market bots feeding off each other in a blind panic, so now people are painfully aware of what the bots can do.

My understanding of the situation (and I'll post details as I get them), is that there's a whole lot of programs pegged to loonie/greenback parity as a psychological barrier ie. if it hits parity this has special meaning in the market so it's time to take certain (possibly drastic) steps in terms of the relationship between the loonie and greenback that could have far-reaching effects.

Hence nobody wants to be the first person to buy that fatal loonie unless they're in a market position vis-a-vis the loonie in particular or the Canadian economy in general that will allow them to benefit from the consequences of triggering the bots. I'm thinking someone rich in oil futures, or Great White North diamond speculators, somebody with a lot of houses to build and no timber to do it with, maybe a Blackberry enthusiast.

Anybody out there with a US cash account wanna buy a loonie, expensive?

:popcorn:

[TrogL]

88. More discussion here

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2998843

[TrogL]

94. WE JUST HAD A CASH TRADE AT PARITY ( I think)

I'm watching three different up-to-the second charts and something happened about 45 minutes ago that was either at parity or within so many decimal places it won't display properly.

(update)

My best guess is 12:49 Chicago time US. $.9995.

[ozymandius]

98. Your eyes do not deceive you.

That was parity. Congratulations on sound fiscal policy in the Great White North.

:hi:

[TrogL]

104. Closing blather

Blather

The December Canadian Dollar gapped up and closed sharply higher on Thursday as it extends this month's rally. The mid- range close sets the stage for a steady opening on Friday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. December continues to extend this month's rally into new uncharted territory making upside targets hard to project. Closes below today's gap crossing at .9874 would confirm that a short-term top has been posted. First resistance is today's high crossing at .10015. First support is today's gap crossing at .9874 then the 10-day moving average crossing at crossing at .9713.


Analysis

HAHA!!!! We broke the bot.

>First resistance is today's high crossing at .10015.

Either the decimal's wrong or we're missing a "1".

[TrogL]

105. More blather

http://www.dailyfx.com/story/topheadline/Is_it_a_Coincidence_that_1190306250485.html

USD/CAD: The Canadian dollar has also set fresh multi-decade heights in dollar terms, with the currency hitting parity with the greenback this morning. Clearly, US dollar weakness has played a very large part in the Loonie’s advance. Yet the Canadian dollar has likewise benefited from oil prices at record-highs and buoyant demand for mergers and acquisitions of Canadian corporations. This leads the Loonie as the perfect anti-dollar trade, with overall momentum to send the currency beyond $1.00 through the short term. Technically, a drop below 1.0004 completes 5 waves down from 1.0173, which would potentially lead to a larger corrective rally back to 1.0175 (former resistance) before a drop to yet a new low that would possibly complete the entire decline from 1.1825.

OK, so I'm not insane. That's what I've been saying pretty much for weeks and thought I was a lone voice in the wilderness.

(linked from the previous article)

http://www.learncurrencytrading.com/fxforum/showthread.php?p=135978#post135978

I know that this is not the EW forum, but I thought I'd share the wave count with this forum since the count is clear.

The USDCAD dropped to 1.0004 this morning and lower prices lie ahead. The vertical drop from 1.0132 is undoubtedly a 3rd wave in a 5 wave decline from 1.0173. As such, look for consolidation in a 4th wave correction before a drop to a new low (below 1.0004). A drop below 1.0004 to complete 5 waves down from 1.0173 would potentially lead to a larger corrective rally back to 1.0175 (former resistance) before a drop to yet a new low. That would possibly complete the entire decline from 1.1825. We are showing the 25 min chart this morning.

(pretty picture followed by some other posts from a variety of people including mods)

hi all i am not agree with jamie view about usd/cad becuse usd/cad is in 5rd wave and ended 4rd wave and usd/cad will go untill 127 fibo in 5rd wave (0.9940) till 5rd completely

...

84% of retail traders are long USDCAD (long to short ratio is 5.34). However, since last week, retail has been selling the USDCAD (short positions are up by 8.3%). When retail is long but reduces its exposure, the long term direction remains bearish but the market might have some upside in the short term. The SSI gives us a MEDIUM SIGNAL TO SELL USDCAD.

:wtf:

[UpInArms]

63. OT: Bush's farm secretary quits, latest to go (going to run for R-NE senate seat - Hagel's)

http://news.monstersandcritics.com/usa/news/article_1358015.php/Bushs_farm_secretary_quits_latest_to_go

Washington - US Agriculture Secretary Mike Johanns said Thursday he is resigning, the latest in a series of departures among President George W Bush's top aides.

Johanns, the son of a dairy farmer from the Midwestern state of Nebraska, is considering a run for a US Senate seat in his home state.

Announcing Johanns' resignation, Bush praised him for championing renewable fuel - which includes ethanol made from corn, a major Midwestern crop - and for pressing other countries to open their markets to US beef.

No replacement was immediately announced.

Bush's term ends in January 2009. Recent departures include attorney general Alberto Gonzales, a longtime Bush confidant; Bush's top political strategist, Karl Rove; and chief White House spokesman Tony Snow.

...more...

[TrogL]

66. Is my morning mochachino going to get a lot more expensive?

(from http://quotes.ino.com/exchanges/?c=food I got it by email, haven't been able to find the blather on the site)

December coffee closed higher on Wednesday as it extends this week's rally above the 62% retracement level of the December-May decline crossing at 129.17. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near-term. If December extends this week's rally, the 75% retracement level of the December-May decline crossing at 133.26 is the next upside target. Closes below the 10-day moving average crossing at 122.24 would confirm that a short-term top has been posted.

December cocoa closed higher on Wednesday as it extended the rally off August's low. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If December extends the rally off August's low, the reaction high crossing at 19.23 is the next upside target. Closes below last week's low crossing at 17.95 are needed to confirm that a short-term top has been posted.

October sugar closed sharply higher on Wednesday breaking out to the topside of this month's trading range. The high-range close set the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above the reaction high crossing at 9.73 are needed to confirm that a low has been posted. Closes below the reaction low crossing at 9.20 would confirm that a double top with the August 23 high has been posted.

Milk's going up too but they didn't give me a blather on that.

:scared:

[antigop]

69. Bernanke: Subprime solution is risky

http://money.cnn.com/2007/09/20/real_estate/bernanke_house_testimony/index.htm?postversion=2007092010

>>
Federal Reserve Chairman Ben Bernanke warned lawmakers Thursday to be careful in how they try to fix the nation's mortgage crisis.

In written testimony for the House Financial Services Committee, Bernanke noted that there are risks associated with raising the limits on the size of loans that Fannie Mae and Freddie Mac may buy - a proposed solution that leading lawmakers have supported and that the Bush Administration may go along with under certain conditions.

"The perception, however inaccurate, that the are fully government-backed implies that investors have few incentives ... to act to constrain GSE risk-taking. Raising the conforming-loan limit would expand this implied guarantee ... reducing market discipline further," Bernanke says in written testimony he will deliver before the House Financial Services Committee.

Bernanke said that if Congress moved in that direction despite the risks, it should be sure that actions are "explicitly temporary and able to be implemented sufficiently promptly to serve its intended purpose."
>>

[Robbien]

82. Overstock.com going after Hedge fund dirty deals

NEW YORK, Sept 20 (Reuters) - The California Supreme Court has cleared the way for trial of a suit by online retailer Overstock.com Inc (OSTK.O: Quote, Profile , Research) against research firm Gradient Analytics and hedge fund Rocker Partners, Overstock said on Thursday.

Overstock alleges that Rocker paid Gradient to publish negative reports about the company and gave Rocker the reports before publication, allowing Rocker time to take a short position in Overstock and profit from its decline.

Since the Overstock suit was filed, other companies have filed similar suits against short sellers.

Overstock is suing Gradient and Rocker for libel, unfair business practices and tortuous interference.

The trial court rejected the defendants' arguments that Overstock's claims should be thrown out because they curbed the defendants' rights of free speech. A state appeals court upheld that decision, and the California Supreme Court refused to review the appeals court ruling.

Overstock Chief Executive Patrick Byrne said in a statement, "This case is about hedge funds illegally enriching themselves at the expense of others. For over two years, these defendants have been hiding behind legal technicalities, delaying procedures, and the risible assertion that their patently illegal behavior was 'free speech.'"

http://today.reuters.com/news/articleinvesting.aspx?type=etfNews&storyID=2007-09-20T153308Z_01_N20406840_RTRIDST_0_OVERSTOCK-COURT-UPDATE-2.XML

[Roland99]

91. 2:23pm - Not so rosy anymore

Dow 13,780.11 -35.45
Nasdaq 2,659.43 -7.05
S&P 500 1,522.81 -6.22
10 YR 4.67% 0.14
Oil $82.60 $0.67
Gold $740.20 $10.70

[Tiberius]

92. Broke through the lows

Not looking good from a technical standpoint now.

[Hugin]

93. 1445: *sputter* *sputter* *cough* *sputter*

Index Last Change % change
• DJIA 13774.83 -40.73 -0.29%
• NASDAQ 2655.59 -10.89 -0.41%
• S&P 500 1521.00 -8.03 -0.53%


Fundamentally, it isn't going anywhere.

[Bushwick Bill]

95. Video: Ron Paul goes bonkers on Ben.

Re: subprime issues and "moral hazard."
http://www.youtube.com/watch?v=AeHWW5gbc0w

[Phrogman]

106. Ron Paul makes so much sense, Gore better step up soon or.........

e0m

[ozymandius]

96. quittin' time: bonds feel the effects of the dollar in the shitter

Dow 13,766.70 Down 48.86 (0.35%)
Nasdaq 2,654.29 Down 12.19 (0.46%)
S&P 500 1,518.75 Down 10.28 (0.67%)
10-Yr Bond 4.672% Up 0.148
NYSE Volume 2,787,706,000
Nasdaq Volume 1,755,788,000

4:25 pm : For the most part U.S. assets fell out of favor today as stocks, bonds and the dollar all lost ground - some more than others.

All things considered stocks had a reasonably good day. Losses were relatively modest in scope, which is noteworthy considering that the S&P 500, entering today's session, was up 3.0% for the week and up 5.3% from its September 10th close. Its 0.7% decline today, then, shouldn't cause any undue alarm as the move was little more than a profit taking effort following the strong run.

Disappointing earnings news from Circuit City (CC 8.67, -1.90) and FedEx (FDX 104.45, -3.06) provided an excuse for the selling interest, as did the dollar's weakness, which helped drive up commodity prices and long-term interest rates.

The weak dollar showing (-0.9%) was attributed to a London newspaper's report that Saudi Arabia might de-link its currency from the dollar.

Whether one believes that or not, it was a catalyst that left currency traders, who were already in a bearish mood after the Fed's rate cut, thinking more bearish thoughts on the dollar. The euro for its part hit an all-time high against the dollar while the Canadian loonie reached parity with the dollar for the first time since 1976.

Little was made of the boost the weak dollar will provide to earnings for multinational companies or the stock market's strong run since 2003 that occurred as the dollar steadily declined. That goes to show there was some one-sided thinking today, which is understandable given the stock market's big gains of late.

The weakness in the dollar took a heavy toll on the Treasury market where the 10-year note dropped more than a point, bringing its yield up to 4.70%. Better than expected initial claims data and a stronger than expected Philly Fed Index, which is a regional manufacturing report, sucked more wind out of the Treasury market which had been staring at a 10-year note yield of 4.32% less than two weeks ago.

The jump in market rates, combined with the spike in the price of oil (+$1.39 to $83.32) and other commodities, held stocks in negative territory for almost the entire session.

The financial (-1.7%) and consumer discretionary (-1.5%) sectors bore the brunt of today's selling efforts. Keep in mind, though, that they have been two of the best-performing areas in the past week or so. In other words, they were due for a pullback.

A remarkably strong earnings report from Goldman Sachs (GS 203.53, -1.97) offered some early support, but the investment bank failed to hold its gain as it retreated with the broader market in the afternoon trade. Industry peer Bear Stearns (BSC 115.46, -0.18) had a lousy report, but its stock held up on the notion that the bad news was already in the price. Like Goldman, Bear Stearns surrendered its earlier gains to finish with a slight loss.

Fed Chairman Bernanke and Treasury Secretary Paulson were on Capitol Hill today testifying on the mortgage market. Neither said anything surprising, so their remarks didn't have any real impact on today's trading.DJ30 -48.86 NASDAQ -12.19 SP500 -10.28 NASDAQ Dec/Adv/Vol 1860/1120/1.78 bln NYSE Dec/Adv/Vol 2335/978/1.24 bln

[UpInArms]

101. Is it a Coincidence that the US dollar, Canadian Dollar, Oil and Gold are Breaking Significant Level

Is it a Coincidence that the US dollar, Canadian Dollar, Oil and Gold are Breaking Significant Levels at the Same Time?

http://www.dailyfx.com/story/topheadline/Is_it_a_Coincidence_that_1190306250485.html

It is a record breaking day in the financial markets and the action is not in US stocks, which have been bouncing between positive and negative territory all morning but in the currency and commodity markets. If you haven’t realized it, the US dollar has plummeted to a record low against the Euro and a 30 year low against the Canadian dollar. The trade weighted Dollar Index is hovering right above 78.19, its lifetime lows set back in 1992. Gold prices also hit 28 year highs above $730 an ounce and even though oil prices are softer this morning, the front month October contract on the NYMEX hit a high of $82.15. Gold at $800 an ounce and oil at $100 a barrel has now become an increasingly likely possibility.

Is it a coincidence that the US dollar, oil and gold are all breaking significant levels at the same time? No.

This is one of those cases where we should ask the question What Came First, the Chicken or the Egg. It can be said that the weakness of the US dollar has driven both gold and oil prices higher but at the same time, the rally in oil prices has played a major role in pushing USD/CAD towards parity (1.0) and raising concerns aboutUS consumer spending in the months ahead. The weakness in the US dollar reflects the potential for further problems in the US economy as well as the impact of interest rate cuts on the US dollar. The reason why the dollar can be blamed for the strength of oil and gold is because a weak dollar induces inflationary pressures and since oil is priced in dollars, OPEC nations have a vested interest in seeing oil prices rise just so that they do not see a significant shortfall in profits. As you can see, the financial markets are very interrelated and movement in one market will certainly lead to movements in others. In fact, the following charts illustrate how the EUR/USD, Gold and Oil prices have moved in lockstep since the inception of the Euro.

...more...

[ozymandius]

102. No chance in Hell.

Says I.