STOCK MARKET WATCH, Thursday August 21

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday August 21, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 153
DAYS SINCE DEMOCRACY DIED (12/12/00) 2769 DAYS
WHERE'S OSAMA BIN-LADEN? 2494 DAYS
DAYS SINCE ENRON COLLAPSE = 2785
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

AT THE CLOSING BELL ON August 20, 2008

Dow... 11,417.43 +68.88 (+0.61%)
Nasdaq... 2,389.08 +4.72 (+0.20%)
S&P 500... 1,274.54 +7.85 (+0.62%)
Gold future... 816.30 -0.50 (-0.06%)
30-Year Bond 4.44% -0.03 (-0.58%)
10-Yr Bond... 3.80% -0.04 (-1.12%)






GOLD,EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp

Why So Depressed?
BY CHRIS PUPLAVA

Phil Gramm, economic advisor to Presidential candidate John McCain, said last month that the U.S. consumer was in a mental recession and that the economy’s fundamentals didn’t warrant the low consumer confidence numbers. Mr. Gramm made the following comments in a Washington Times interview: McCain adviser talks of ‘mental recession’ (07/09/2008)

We have sort of become a nation of whiners.

You just hear this constant whining, complaining about a loss of competitiveness, America in decline.

We've never been more dominant; we've never had more natural advantages than we have today. We have benefited greatly (from the globalization of the economy in the last 30 years).

“WE have benefited greatly,” Mr. Gramm? In case you hadn’t heard, real wages for the average consumer have DECLINED this decade unlike Wall Street heads who have been showered with multi million dollar bonuses. They have received these bonuses as a reward for helping expand the financial economy’s largess to produce a generational credit bubble and for selling our asset-backed slime all over the world, damaging our financial institution’s credibility in foreigners’ eyes. Those same Wall Street CEOs have been punished for their crimes by getting the boot with outlandish bonuses and severance packages as the small list below highlights.

* Lloyd Blankfein: Goldman Sachs Group Inc. – $67.9 million bonus received in 2007.
* Charles Prince: Citigroup Inc. – Retires with a $42 million package in 2007
* Stanley O’Neal: Merrill Lynch & Co. Inc. – Retires with $161.5 million in 2007
* Angelo Mozilo: Countrywide Financial Corp – Retirement package of $23.8 million, while refusing to accept $37.5 million severance package in 2007
* Martin J. Sullivan: AIG - $47 million severance package received in 2008

Main Street has not been as fortunate as their Wall Street brethren in terms of income nor received as many handouts, backstops, and bailouts from the Fed and Treasury. Indeed, Main Street has much to be concerned about. Both corporate America and the consumer do not see the same sanguine environment that Mr. Gramm does.

....

What is the cause of all this pessimism? The U.S. is entering into a period of economic weakness and the U.S. consumer has never been more under prepared to navigate the waters ahead with a record low savings rate and all-time high debt obligation ratio. Moreover, the U.S. consumer has likely come to terms with the realization that it’s spent up, that after nearly three decades of a debt binge, consumer balance sheets are in dire need of some healing. Moreover, businesses likely see a protracted consumer retrenchment ahead and know what that will mean to their bottom line. But why did the U.S. consumer go on a debt binge over the last three decades, and what were the fundamental shifts that led to this? I would suggest there are two primary causes of the consumer’s debt binge, both rooted in the consumer’s struggle to maintain its standard of living.

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

[AnneD]

21. Morning Marketeers......

:donut: and lurkers. The above article plus the new CBS poll showing McCain having taken the lead away from Obama in regard to trust in economic issues just has me steaming mad at the Obama election committee. Screw the choice of VP candidate. It's not important to Obama unless he selects a real bow wow.The only time I even thought about that was when Bush Sr. chose Quayle and even then I thought it was assassination insurance for Sr. McCain's choice has greater weight due to his age, but that's his problem.

This election will be decided based on economy, not Iraq, not terrorism, not Russia, not global warming....IT'S ABOUT THE ECONOMY. Are you better off than you were eight years ago??? Does McCain and his economic adviser understand your problems? Does he offer Bush's sloppy seconds, or REAL solutions. I know that and folks on this thread know what is at stake. But the Obama campaign has not gotten it across to the voters. We are being propped up rather precariously now, and it does not bode well for the winner of the election. But if I were going through an economic shit storm, I think my chances of survival are better with Obama. And this is what the Obama campaign needs to latch on to!

Those that think Phil and Wendy Gramm are out of the campaign need to have the water of cold reality splashed in their faces. I would be running those clips of Gramm's comments at every opportunity. Call Obama elitist and out of touch with the average American-run the clip of Gram. Mention fund raising improprieties, mention McCain's and Gramm's history and run the clip of Gramm. Trash Obama's family values or other values, mention McCain's, Gramm's funding of porn movies, and run the clip of Gramm. Good God, these folks gave you a present...USE IT.

As we say here in Texas, it's time to shit or get off the pot. Barack can pound away on McCain and the economy, and just the fact, not made up stuff, and win the election. In fact, any issue they raise, tie McCain to Bush and mention Gramm, and they can't argue against it. I hope he lets loose the dogs of war soon because this high ground is starting to cost him the independents, unsure GOP, and marginal DEM's. If it's worth having, it's worth fighting for.

Happy hunting and watch out for the bear.

[rfranklin]

24. "It's the economy, stupid!" Where did we hear that before?...

I think there are too many Americans who are ignorant of the connection between Republicans and higher unemployment and lower wages, lack of health care and bankrupt social security funds. This should be pounded home with a sledge hammer. And it's not political rhetoric, as you say, it's the goddamn truth!

[Dr.Phool]

27. Obama ran a brilliant primary campaign.

As far as the General goes, I don't know what universe he's in. He had to define McCain before they had a chance to define him, and they're failing miserably. The fact that McCain is within 20 points is testament to that.

It's as though they dusted off the old Gore and Kerry consultants from elections past. Couple that with a dickhead Senate and House, who won't take a stand on anything, and they're trying very hard to snatch defeat from the jaws of victory.

[AnneD]

61. I am praying for a big Convention boost....

and hope he wakes up. There is no excuse for the campaign he has been running. He needs to activate his base and hammer the crap out of McCain. Link McCain so close to George Bush that they look like they are committing adultery against their wives.

This election is the DEM's to lose....NOT THE GOP's (just like the last cycle).

Barak is very qualified, far more than McCain, and if the DEM's are too stupid to explain the obvious to the voting public...The DEM party is not worth 'saving'. They are as useful as tits on a boar hog. Like they are in Congress.:grr:

Edited to add: you have to prove you are a leader and foto ops don't count. Brack needs to start fighting like a trial lawyer not a prom queen.

[Dr.Phool]

74. Agreed

:toast:

[ozymandius]

2. Today's Reports

08:30 Initial Claims 08/16
Briefing.com 435K
Consensus 438K
Prior 450K

10:00 Leading Indicators Jul
Briefing.com -0.3%
Consensus -0.3%
Prior -0.1%

10:00 Philadelphia Fed Aug
Briefing.com -12.0
Consensus -13.4
Prior -16.3

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

[UpInArms]

17. Initial Claims @ 432,000 - no revision to last week

05. U.S. weekly initial jobless claims fall 13,000 to 432,000
8:32 AM ET, Aug 21, 2008

[UpInArms]

30. Federal jobless claims jump to 1.28 million

http://www.marketwatch.com/news/story/economic-report-initial-state-jobless/story.aspx?guid=%7B67DE9B1E%2D007A%2D47EF%2DB8A0%2D9FB9D05F3DA8%7D&dist=hplatest

WASHINGTON (MarketWatch) -- More than a million unemployed Americans have applied for an additional 13 weeks of unemployment benefits under a new program approved by Congress last month, the Labor Department reported Thursday.

The new federal program has had the unintended consequence of masking the true state of the labor market, because it's temporarily boosted the number of people applying for regular state unemployment benefits.

The number of new claims for state benefits fell by 13,000 to 432,000 last week. However, the number of claims under a new extended federal program rose by 714,000 to 1.28 million in the week ending Aug. 2, the Labor Department reported.

This is the first week the government has reported on the level of extended federal benefits.

The new program just underway allows unemployed workers who've exhausted the typical 26 weeks of eligibility for state benefits to get an additional 13 weeks of federal relief. It skewed new claims for state benefits higher in recent weeks, as some of those filing for the federal program instead found they still were eligible for state benefits.

...more...

[UpInArms]

31. U.S. leading indicators fall 0.7% in July

03. Leading inde points to slow economy, or 'grinding to halt'
10:00 AM ET, Aug 21, 2008

04. U.S. July leading indicators fall 0.7%
10:00 AM ET, Aug 21, 2008

http://www.marketwatch.com/news/story/us-leading-indicators-fall-07/story.aspx?guid=%7B14EC793B%2DD414%2D4639%2DA8AC%2DCA485288014F%7D&dist=msr_2

WASHINGTON (MarketWatch) - U.S. leading economic indicators fell 0.7% in July, pointing to "slow growth the rest of the year, and possibly an economy grinding to a halt," the Conference Board reported Thursday. "If there's a second-half recovery, it'll be the second half of 2009," said Ken Goldstein, labor economist at the private research organization. Five of the 10 indicators declined in July, led by building permits and stock prices. In the past six months, the leading index has fallen at a 1.8% annual rate, with seven of the 10 indicators falling over that period. The index was flat in June.

[UpInArms]

37. "If there's a second-half recovery, it'll be the second half of 2009"

http://www.marketwatch.com/news/story/leading-indicators-fall-07-july/story.aspx?guid=%7B8EFE8CB1%2D5207%2D4B7D%2DB128%2D104A9CE506D0%7D

WASHINGTON (MarketWatch) -- U.S. leading economic indicators fell 0.7% in July, pointing to "slow growth the rest of the year, and possibly an economy grinding to a halt," the Conference Board reported Thursday.

"If there's a second-half recovery, it'll be the second half of 2009," said Ken Goldstein, labor economist at the private research organization. "The recent decline in gas prices isn't enough to overcome all the negative momentum that's been building up."

Five of the 10 indicators declined in July, led by building permits and stock prices. Three of the indicators rose, led by the interest-rate spread and consumer expectations.

In the past six months, the leading index has fallen at a 1.8% annual rate, with seven of the 10 indicators falling over that period. The index was flat in June.

The coincident index rose 0.1% in July. In the past six months, the coincident index (which includes the four indicators used to judge whether the economy is in recession) fell 0.4%, with all four indicators dropping.

...more...

[UpInArms]

32. US Aug Philly Fed @ -12.7

01. U.S. Aug. Philly Fed improves to -12.7 vs. -13.5 expected
10:02 AM ET, Aug 21, 2008

[UpInArms]

43. Manufacturing worsens in Philly area for 9th straight month

http://www.marketwatch.com/news/story/manufacturing-worsens-philly-area-9th/story.aspx?guid=%7B614EF94A%2D899E%2D413E%2DAD43%2D9904E655500A%7D

WASHINGTON (MarketWatch) -- Manufacturing activity declined in the Philadelphia region for the ninth month in a row in August, the Federal Reserve Bank of Philadelphia reported Thursday. The Philly Fed index improved to negative 12.7 in August from negative 16.3 in July, indicating a slower pace of decline. Readings under zero indicate most firms report weaker conditions. Price pressures moderated, with the price-paid index falling to 57.5 from 75.6. The new-orders index was nearly unchanged at negative 11.9.

[UpInArms]

46. RPT-TABLE-Phila Fed business conditions -12.7 in Aug

http://www.reuters.com/article/bondsNews/idUSN2141843320080821

Philadelphia said on Thursday its index of business conditions
in the U.S. Mid-Atlantic region rose in August to -12.7 from -16.3 in July.
 Following is a breakdown of the survey's components:
                      August Diffusion Index           Historical data
                       Aug  Drop  Unch  Rise    July  June   May April
Business Conditions     -12.7  36.1  39.4  23.4   -16.3 -17.1 -15.6 -24.9
New Orders              -11.9  37.0  36.4  25.1   -12.1 -12.4  -3.7 -18.8
Shipments                -3.3  27.6  47.4  24.2    -8.0  -6.7   2.2  -8.0
Unfilled Orders          -8.7  22.6  58.1  13.9   -18.3 -12.5 -19.1 -16.8
Delivery Time            -9.9  11.3  84.2   1.4   -10.7  -8.0 -12.8   4.2
Inventories              -6.6  26.8  51.5  20.2    -7.5 -12.6 -13.1 -26.2
Prices Paid              57.5   7.9  24.0  65.4    75.6  69.3  53.8  51.6
Prices Received          27.0   8.3  51.1  35.3    28.8  29.7  31.6  30.9
Number of Employees      -1.1  17.5  60.9  16.4    -7.3  -6.9  -1.0 -11.1
Avg Employee Work Week  -11.8  25.6  54.3  13.8   -12.5  -8.9  -5.6 -12.3

               Six months from now versus August       Historical data
                       Aug  Drop  Unch  Rise    July  June   May April
Business Conditions      27.6  12.9  36.1  40.5    18.0  21.3  28.2  13.7
New Orders               39.4  10.2  35.0  49.5    24.9  24.2  39.6  16.6
Shipments                36.3  10.7  35.9  47.0    25.5  23.5  35.6  16.0
Unfilled Orders           7.4  12.6  58.7  20.0     1.4  14.6  12.3 -11.9
Delivery Time             3.5   6.3  77.1   9.8    -5.8   6.4  -2.5 -10.4
Inventories              -5.0  22.7  53.9  17.7    -2.3 -14.6 -10.6 -13.1
Prices Paid              51.9   8.2  22.0  60.1    67.1  69.9  56.0  55.3
Prices Received          28.1  12.2  40.1  40.2    49.6  35.4  26.8  33.4
Number of Employees      13.5  15.5  49.7  29.1    17.5   7.3  15.5   0.2
Avg Employee Work Week   13.5   8.3  60.9  21.8     8.5   2.2   9.2  -9.2
Capital Expenditures      9.1  14.0  50.6  23.1     9.2   3.8  19.9  13.8

the most interesting part of those number would be the "prices received" - they are lower all over the place - meaning that they are having to cut prices to make sales and that is going to impact their profitability in a BIG way.

:hi:

[Dr.Phool]

48. With wholesale prices rising steadily, most places are loathe to increase.

There's no money left at the consumer level to pay the higher prices, so retailers, such as restaurants are eating the price increases just to stay in business.

[ozymandius]

3. Oil rises in Asia on falling US gasoline supplies

SINGAPORE - Oil prices rose Thursday in Asia above $116 a barrel as investors mulled a fall in U.S. gasoline inventories and a possible output tightening by OPEC at its next meeting in September.

Light, sweet crude for October delivery was up $1.20 cents at $116.76 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract rose $1.01 overnight to settle at $115.56 a barrel.

.....

Gasoline inventories shrank by a larger-than-expected 6.2 million barrels to below-average levels in the week ended Aug. 15, the U.S. Energy Department's Energy Information Administration said Wednesday. Meanwhile, distillate inventories — which include heating oil and diesel fuel — rose by less than expected, the EIA said.

That was enough to offset a hefty 9.4 million barrel rise in U.S. crude stocks last week when the average analyst forecast had been for a 1.7 million barrel increase, according to energy information provider Platts.

...

In other Nymex trading, heating oil futures rose 2.36 cents to $3.1871 a gallon, while gasoline prices gained 2.64 cents to $2.9367 a gallon. Natural gas futures increased 6.8 cents to $8.145 per 1,000 cubic feet.

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

[UpInArms]

22. U.S. crude futures extend rally, jump $4 - @ $119.77 bbl

http://www.reuters.com/article/hotStocksNews/idUST14048520080821

NEW YORK (Reuters) - U.S. crude futures rose more than $4 on Thursday as tensions between Russia and the West, concern that Tropical Storm Fay might re-enter the Gulf of Mexico and a weaker dollar combined to lift oil futures.

Refined products futures also surged, with heating oil up more than 10 cents.

On the New York Mercantile Exchange at 9:15 a.m. EDT, October crude, now the front month, was up $3.90 or 3.3 percent at $119.46 per barrel, having traded from $115.40 to $119.77.

[UpInArms]

41. Oct. crude up $4.79, or 4.2%, at $120.35/brl on Nymex

10:49 a.m.
Oct. crude tops $120/brl to trade at a two-week high

10:49 a.m.
Oct. crude up $4.79, or 4.2%, at $120.35/brl on Nymex

[ozymandius]

4. Fannie, Freddie shares dive on bailout fears, bonds up

NEW YORK (Reuters) - Fannie Mae (FNM.N) and Freddie Mac (FRE.N) shares plunged to their lowest levels in almost 20 years on Wednesday, while the mortgage companies' bonds rallied on the belief that an increasingly likely government bailout would wipe out shareholders but secure their massive debt.

U.S. Treasury and Freddie Mac officials met to discuss how the company can best weather the current economic woes in light of mounting credit losses, sources familiar with the meeting said, but neither Treasury nor Freddie Mac officials would comment on details.

...

Freddie Mac's stock slumped 22 percent to $3.25, after falling to the lowest level since 1990, and Fannie Mae shares slid nearly 27 percent to $4.40, after hitting the lowest level since 1988.

...

But the debt of Fannie Mae and Freddie Mac rallied, as bond investors believe the government will do whatever it takes to maintain confidence in the two companies, since their ability to issue debt, and use the proceeds to help fund U.S. home buyers, is critical to pulling U.S. housing out of its worst slump since the Great Depression.

http://news.yahoo.com/s/nm/20080820/bs_nm/fannie_freddie_shares_dc

[ozymandius]

8. Paulson's GSE `Bazooka' Shakes Investors He Aimed to Soothe (what an ass clown)

Aug. 21 (Bloomberg) -- U.S. Treasury Secretary Henry Paulson's ``bazooka'' may be intimidating the same investors he intended to reassure.

The powers Paulson won from Congress last month enabling a government rescue of Freddie Mac and Fannie Mae -- authority he likened to a weapon whose mere existence made it unlikely it would have to be fired -- may end up making a bailout more likely, say analysts and investors.

...

In lobbying for the rescue plan, Paulson told lawmakers that giving him authority to bail out the beleaguered lenders would reassure their private sources of capital.

``If you have a bazooka in your pocket and people know it, you probably won't have to use it,'' he told U.S. senators at a July 15 hearing in Washington.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aYrNO2nn11BM&refer=us

---

Paulson's dumbass comments only spooked the bond market - making Fannie and Freddie debt a target for speculation. He "bazooka'd" his own recovery strategy with that quip.

[Dr.Phool]

12. Someone needs to write a new book. Maybe "The Prick Principle".

It would be like "The Peter Principle", only bigger and harder. The new and improved version. Where people rise to positions waaay beyond their level of incompetence. People who are able to take down entire civilizations in a single (maybe a couple of) bound. It would fit this entire Administration, Congress, and Wall Street to a T.

As far as Poulson's bazooka philosophy goes, There's always a counter-move. In my experience in street fighting and martial arts philosophy, when you know the other guy has a bazooka in his pocket, you get him BEFORE he has a chance to get his hand on it.

[DemReadingDU]

13. It's only a matter of time before he uses that bazooka

Why did he ask for $800 billion of our tax payer money, if he didn't intend on on using it?

[Dr.Phool]

14. It looks like you're right. Poulson's getting an itchy trigger finger

http://www.reuters.com/article/newsOne/idUSN2065129520080820

Paulson likely to reach for GSE "bazooka"
Wed Aug 20, 2008 6:09pm EDT


By David Lawder - analysis

WASHINGTON (Reuters) - U.S. Treasury Secretary Henry Paulson last month described a proposed federal backstop authority for Fannie Mae and Freddie Mac as a "bazooka" whose mere presence would silence market unrest over the viability of the two mortgage finance giants.

But just weeks after receiving the new weapon from Congress, the Treasury looks increasingly likely to have to use it, at a cost of billions of dollars to taxpayers.

A deepening American housing slump, mounting mortgage losses, and rising borrowing costs are conspiring to shatter confidence in Fannie (FNM.N: Quote, Profile, Research, Stock Buzz) and Freddie (FRE.N: Quote, Profile, Research, Stock Buzz), especially among their shareholders, who fear a de-facto government takeover will wipe them out. Shares of the two government-sponsored enterprises plunged to their lowest levels in 18 years on Wednesday.

"I think the number of options are dwindling every day that we see declines in the stocks. It has become virtually inevitable that the government has to nationalize Fannie and Freddie," said Kevin Cronin, chief investment officer at Boston-based Putnam Investments.

"For them to raise capital at these share prices would be so massively dilutive it would promote some serious lawsuits by shareholders," Cronin said.

The latest round of share price falls this week followed a Barron's article on Sunday that said the government may have no choice but to recapitalize the companies and news on Wednesday of a meeting between officials from the U.S. Treasury and Freddie Mac.

Sources familiar with the staff-level meeting said the two sides discussed the company's financial health and how it can best weather the current economic woes in light of moutninmountingg credit losses.

Freddie was forced to pay a record-high yield premium on a $3-billion debt sale on Tuesday -- 1.13 percentage points above Treasuries -- implying that foreign investors may be shying away from debt once seen nearly as safe as U.S. Treasury debt. Continued...

[UpInArms]

25. Fannie, Freddie continue downward spiral early Thursday

http://www.marketwatch.com/news/story/fannie-freddie-continue-downward-spiral/story.aspx?guid=%7B3D3B5046%2D3122%2D4680%2D916E%2D795524FDE503%7D&dist=hplatest

NEW YORK (MarketWatch) -- Fannie Mae (FNM: 4.22, -0.18, -4.1%) and Freddie Mac (FRE: 2.99, -0.26, -8.0%) continued their downward spiral early Thursday, as the broader financial sector was again hit by poor sentiment over the two mortgage giants. Freddie was down 20% and Fannie dropped 18% at the open. The mortgage insurers also fell in early action -- Radian Group (RDN: 3.14, -0.17, -5.1%) was down 13%, PMI Group (PMI: 3.11, -0.11, -3.4%) down 5.3% and MGIC Investment Corp. (MTG: 6.74, -0.08, -1.2%) down 7% -- as did the bond insurers, with Ambac (ABK:
4.97, -0.25, -4.8%) dropping 15.3% and MBIA (MBI: 10.24, -0.25, -2.4%) falling 4.5%. The Financial Select Sector SPDR (XLF: 19.92, -0.43, -2.1%) , an ETF tracking financials in the S&P 500, declined 2.6%, while the Amex Securities Broker/Dealer Index (XBD: 139.73, -2.61, -1.8%) also dropped 1.7% early Thursday.

[UpInArms]

26. Losing Fannie and Freddie would deal a blow to Wall Street

http://www.marketwatch.com/news/story/losing-fannie-freddie-would-deal/story.aspx?guid=%7BA1458590%2D2FA5%2D469D%2DA14D%2D5FC0B148602F%7D&dist=TNMostRead

NEW YORK (MarketWatch) -- Financial bailouts are supposed to save institutions. So why does the imminent takeover of Freddie Mac and Fannie Mae seem like a Russian peacekeeping mission in Georgia?

On Monday the government sponsored mortgage entities tumbled 20% after Freddie (FRE: 2.87, -0.38, -11.7%) was forced to pay unusually rich terms to sell $3 billion in debt. Shares of Freddie brushed an all-time low Wednesday. Confidence in the lenders is eroding even though Treasury Secretary Henry Paulson sought and received congressional permission to spend taxpayer money to prop up the GSEs.

Just based on the raw numbers, this shouldn't be happening. Fannie and Freddie barely touched the subprime and Alt-A loans that have been blamed for so much of the credit crisis. And while many homeowners are hurting, the number of defaulted loans is about 2%, less than half of the rate in the great S&L crisis, according to the Federal Deposit Insurance Corp. That's industry-wide, not at the GSEs where lending standards are much higher.

So, even though logic says this shouldn't be happening, it is. The idea of Fannie and Freddie going the distance is something we need to let go of. Yankee fans should understand.

Accepting the situation, let's do some triage: Fannie (FNM: 4.15, -0.25, -5.7%) and Freddie have purchased about $5 trillion in U.S. mortgages, or about half of the home loans outstanding. While it's pretty clear what the loss would be to the U.S. economy and housing market, the impact on Wall Street has been less discussed.

It's hard to imagine any institution or investor gaining from a GSE bailout. Everyone seems bound to suffer. But there are some that are more at risk of losing than others. So, let's sort out the bodies:

...more...

[UpInArms]

71. Former FDIC chief urges breakup of Fannie, Freddie

http://www.marketwatch.com/news/story/former-fdic-chairman-seidman-advocates/story.aspx?guid=%7BB12D3012%2D96D0%2D41E4%2DB944%2D62D5EA5D7FA3%7D&dist=hplatest

BOSTON (MarketWatch) -- The former chairman of the Federal Deposit Insurance Corp. who played a key role in healing the U.S. banking system after the savings and loan crisis said Thursday he advocates a breakup of struggling mortgage buyers Fannie Mae and Freddie Mac.

"We need a plan for breaking up Fannie and Freddie and selling them to private investors, so that the government isn't the biggest backer of the housing market," said Bill Seidman in an interview with MarketWatch in Boston's financial district on Thursday.

The former FDIC head who helped revive banking confidence after the S&L debacle in the late 1980s said "the only real productive alternative" is to nationalize Fannie (FNM: 4.79, +0.39, +8.9%) and Freddie (FRE: 3.25, +0.01, +0.3%) as a first step.

Shares of the government-sponsored mortgage entities have been in a death spiral this week on mounting fears they will require a bailout that could essentially wipe out shareholders.

Seidman said a government bailout of Fannie and Freddie would dwarf the tab from the S&L crisis, estimating it would involve assets between $5 trillion and $6 trillion.

...more...

[CatholicEdHead]

79. Grover Norquist has to be smiling somewhere

[Demeter]

82. I'm Trying and Failing to Understand His Reasoning

I know it hit 90 and I'm hot and the humidity climbed, but still...

WHAT IS HE THINKING! The private sector created the shadow market that is crashing around our ears, and sought to pervert Fannie and Freddie from their original purpose.

And putting Harry Paulson in charge of them if they are nationalized? Has his brain melted in the heat?

[wordpix]

76. geez, they've already dived, now they're just about penny stocks...

[ozymandius]

5. Federal Reserve investigated Lehman rumors: report

(Reuters) - The Federal Reserve acted on rumors last month and called Credit Suisse Group to see if it had pulled a credit line from Lehman Brothers Holdings Inc, The Wall Street Journal said citing people familiar with the matter.

Credit Suisse told Federal Reserve officials that there was no truth to the rumor and it had no intention of pulling the line of credit, the paper cited the people as saying.

http://news.yahoo.com/s/nm/20080821/bs_nm/fed_lehman_rumor_dc

[UpInArms]

19. Fed Acted on Lehman Rumor

http://online.wsj.com/article/SB121928810086359431.html?mod=mktw

In an apparent attempt to prevent a repeat of the cascading rumors that helped sink Bear Stearns Cos., the Federal Reserve last month quietly called one major bank to see if it had pulled a credit line from Lehman Brothers Holdings Inc., people familiar with the matter said.

Responding to a July rumor that Credit Suisse Group planned to pull a line of credit to Lehman, Federal Reserve officials called to see if it was in fact true, according to these people. Credit Suisse told Fed officials there was no truth to the rumor and it had no intention of pulling the line of credit, the people said.

The Fed's unusual move underscores the tough position that federal officials are in as the Wall Street investment bank tries to overcome mortgage-related losses. As financial institutions suffer through write-downs and loan woes, the Fed has a strong incentive and the moral authority to dispel groundless speculation that could threaten the viability of an important cog in the U.S. financial system.

"You don't want to upset the Fed," said one senior Wall Street banker. But urging lenders and trading partners to stick by an embattled firm also carries the risk that it will inflame the same anxieties that the Fed is trying to soothe. That is one reason why such calls occur rarely.

In addition to pounding its bottom line, Lehman has complained that its problems have been fodder for vicious, unfounded rumormongering by traders who profit when the firm's share price declines.

Lehman has repeatedly denounced negative speculation, even calling individuals believed to be spreading rumors and trading desks said to be skittish about doing business with the investment bank.

...more...

[UpInArms]

20. Lehman's secret talks to sell 50% stake stall

http://www.ft.com/cms/s/0/586ed412-6ee6-11dd-a80a-0000779fd18c.html?nclick_check=1

Lehman Brothers, the beleaguered US investment bank, held secret talks to sell up to 50 per cent of its shares to South Korean or Chinese parties in the first week of August but failed to reach agreement with either.

The South Koreans and Chinese walked away after concluding that Lehman was asking too high a price, said New York-based people familiar with the potential buyers. Lehman declined to comment.

The talks reflect the growing pressure on Dick Fuld, Lehman’s chief executive, to raise capital ahead of the mid-September earnings report, which, analysts said, could include more writedowns of $4bn (£2bn), bringing the total so far to $12bn. Lehman shares have fallen nearly 85 per cent since early 2007 and its market value is now about $9.5bn.

In addition to selling a stake in itself, Lehman is considering selling all or part of its holdings, including its troubled $40bn commercial real estate portfolio and its asset management arm, which includes Neuberger Berman. Analysts said the asset management arm was the crown jewel that could be worth up to $10bn.

In the first week of August, Lehman held parallel talks with the government-owned Korea Development Bank and China’s Citic Securities at its headquarters in New York’s Times Square area.

...more...

edited stupid glitch in the title line :shrug:

[Ghost Dog]

54. Citi cuts outlook on Lehman, Morgan Stanley, Goldman

Thu Aug 21, 2008 4:29am EDT
(Reuters) - Lehman Brothers Holdings Inc, Goldman Sachs Group Inc and Morgan Stanley may incur further writedowns, mainly on their mortgage assets, said an analyst at Citigroup, who cut his third-quarter outlook for the U.S. investment banks.

"We are lowering our third-quarter estimates to reflect the difficult operating environment, characterized by lower client-related trading volumes and losses on hard-to-sell assets," analyst Prashant Bhatia wrote in a note to clients.

Bhatia expects Lehman to take fresh asset-related writedowns of $2.9 billion. He expects $1.8 billion in writedowns at Goldman and $1.7 billion at Morgan Stanley.

The analyst, however, said he saw a "lower probability" that Lehman would sell its Neuberger Berman business or raise capital in the near term.

Several Wall Street analysts have been speculating a possible sale of all or a portion of Lehman's asset-management business -- a move mentioned in media reports as a possibility for weeks.

Experts estimate the business, whose core is Neuberger Berman, could be worth about $8 billion.

"Even under the potentially more stringent rating-agency guidelines related to the amount of preferred securities in the capital mix, we anticipate that Lehman can absorb over $3 billion of after-tax losses without adding more common equity," Bhatia said.

The analyst widened his third-quarter loss estimate for Lehman to $3.25 a share from 41 cents a share.

He cut his third-quarter earnings estimates for Goldman to $2.50 a share from $4.50, and for Morgan Stanley to 75 cents a share from 76 cents.

/... http://www.reuters.com/article/topNews/idUSBNG27102720080821

This was version 1, which I'd saved since about seven hours ago (I'm busy away from desk these days). The unacknowledged, and longer, REWRITE (at same URL) now reads:

Analysts see tough quarter for U.S. investment banks
Thu Aug 21, 2008 10:30am EDT
BANGALORE (Reuters) - Wall Street research analysts are projecting yet another tough quarter for U.S. investment banks marked by additional writedowns across a series of fixed-income assets amid an already weak operating environment.

Shares of Lehman Brothers Holdings Inc fell as much as 9 percent in morning trade Thursday, after a Citigroup analyst forecast big losses for the fourth largest U.S. investment bank, while a newspaper reported that an intended asset sale had collapsed.

Citigroup analyst Prashant Bhatia widened his third-quarter loss estimate for Lehman Brothers Holdings Inc. Bhatia and Lehman Brothers Inc analyst Roger Freeman also cut their third-quarter earnings estimates for Goldman Sachs Group Inc and Morgan Stanley.

"We are lowering our third-quarter estimates to reflect the difficult operating environment, characterized by lower client-related trading volumes and losses on hard-to-sell assets," Citigroup's Bhatia said.

Bhatia expects Lehman to take fresh asset-related writedowns of $2.9 billion. He expects $1.8 billion in writedowns at Goldman and $1.7 billion at Morgan Stanley.

/... http://www.reuters.com/article/topNews/idUSBNG27102720080821?sp=true

[UpInArms]

68. Ladenburg says hostile buyout of Lehman now a possibility

01. Ladenburg Thalmann raises Lehman Bros. shares to buy
1:14 PM ET, Aug 21, 2008

02. Ladenburg says hostile buyout of Lehman now a possibility
1:14 PM ET, Aug 21, 2008

[ozymandius]

6. FDIC Faces Balancing Act in Replenishing Its Coffers

WASHINGTON -- As financial institutions continue to fail, the Federal Deposit Insurance Corp. is under pressure to decide how to replenish the fund that insures consumer deposits.

The fund is stocked mostly by fees levied on U.S. banks. If the FDIC raises the fees, that would siphon more money from already cash-strapped financial institutions. It could also deplete funds that banks would otherwise use to make loans.

But if the FDIC moves too cautiously, the fund could run dry at a crucial time. That could hurt public confidence in the banking system and force the government to use taxpayer dollars to restock the fund.

....

Two bank failures in the second quarter are estimated to have cost the fund $216 million, and the four bank failures so far in the third quarter could have cost another $9 billion. The failure of IndyMac Bank in July may have wiped out more than 10% of the fund.

Such losses could easily push the fund below a 1.15% level, triggering a requirement that the FDIC come up with an action plan within 90 days to bolster the fund.

http://online.wsj.com/article/SB121927727160658617.html?mod=googlenews_wsj

[Theres-a]

15. Plus

There was an article floating around that said yet another large bank is predicted to fail.:scared:

[Dr.Phool]

16. That article is probably wrong.

I think it's more than just "another".

[AnneD]

67. I heard he same thing too...

they didn't name names though. I agree with you DP, but I heard this on the tube in the last day or so. Look for that large Friday afternoon pizza order.

[Dr.Phool]

75. Well, since the whole Fay thingy has missed us.

I'm still stocked up on vodka, and I can whip up a whole bunch of pizza's!

Hmmm, Crab Alfredo Pizza, with a side of Stoli!

[AnneD]

81. I don't think the FDIC auditors can have Stoli....

put I'll drink to that:toast: Watch out for flood waters and surges.

[wordpix]

77. now THIS isn't good

[wordpix]

78. is money any safer in a "traditional" retirement account? You then have no liquidity til you retire

[Zynx]

80. Congress will simply restock the fund if it has to.

[ozymandius]

7. Wachovia Unloads Troubled Loans

In an early sign that investors are starting to pounce on the billions of dollars of troubled land and construction loans that banks are looking to unload, a venture headed by LandCap Partners is buying $40 million of such assets from Wachovia Corp.

LandCap, a residential-land company headed by real-estate veteran Jeffrey Gault, has created a joint venture that will buy the loans which have a book value of $75 million to $80 million, according to people familiar with the deal.

The loans are to home developers and collateralized by 2,900 house lots -- which are in varying stages of development -- in such states as California, Arizona, Florida and Illinois. Many of the loans are in some form of distress because of delinquent payments or plunging values of the collateral. Charlotte, N.C.-based Wachovia, which declined comment, will be a minority partner in the venture.

The deal allows Wachovia, one of the nation's largest construction lenders, to move the troubled loans off its books and raise capital. LandCap will service the loans and foreclose on the troubled debt if deals can't be worked out with distressed borrowers. The venture plans to sell foreclosed property to other home builders.

http://online.wsj.com/article/SB121920087303955809.html?mod=fpa_mostpop

[ozymandius]

9. U.S. Stock-Index Futures Fall; Lehman Brothers, Wal-Mart Drop

Aug. 21 (Bloomberg) -- U.S. stock-index futures dropped as investors speculated that writedowns at financial companies will increase and a climb in oil damped the earnings prospects for retailers and airlines.

Lehman Brothers Holdings Inc. slid 3.2 percent in Germany as Citigroup Inc. reduced its earnings estimates for the fourth- largest U.S. securities firm and the Financial Times said Korea Development Bank and China's Citic Securities Co. abandoned talks to buy a stake in Lehman. Wal-Mart Stores Inc. slipped 0.9 percent as crude advanced for a third day. Investors will also focus on reports that may show the U.S. economic outlook dimmed for a third straight month and manufacturing in the Philadelphia region contracted.

...

Lehman fell 44 cents to $13.29. The company may post a third-quarter per-share loss of $3.25, wider than the 41-cent loss Citigroup analyst Prashant Bhatia had previously predicted. He also cut earnings forecasts for Morgan Stanley and Goldman Sachs Group Inc.

http://www.bloomberg.com/apps/news?pid=20601103&sid=a1mb1MKUn6Nc&refer=us

[ozymandius]

10. futures at 6:17

S&P futures vs fair value: -8.6. Nasdaq futures vs fair value: -13.5.

[ozymandius]

11. Leading Economic Indicators in the U.S. Probably Fell in July

Aug. 21 (Bloomberg) -- The U.S. economic outlook darkened in July for a third consecutive month and manufacturing in the Philadelphia region contracted in August, reports today may show.

The Conference Board's index of leading indicators, a measure of the economy's direction over the next three to six months, fell 0.2 percent, according to the median forecast in a Bloomberg News survey. The Philadelphia Federal Reserve's gauge of manufacturing was probably less than zero for a ninth month.

The housing recession, rising job cuts and shrinking access to credit raise the risk that consumer spending will falter by year-end, bringing a halt to the economic expansion. As demand from abroad also weakens, the slowdown in manufacturing is likely to intensify.

...

The Philadelphia Fed's general economic gauge, also due at 10 a.m., is projected to come in at minus 12.6. Economists' forecasts ranged from minus 22.4 to minus 5, following a reading of minus 16.3 in July. Negative readings signal contraction. The measure averaged 5.1 last year.

http://www.bloomberg.com/apps/news?pid=20601103&sid=a616Zej0NYFc&refer=us

---

Maybe then we can all say together: "We are in a Recession." It stuns me how many holdouts will not acknowledge this.

[UpInArms]

18. dollar watch

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

Last trade 76.546 Change -0.382 (-0.50%)

Forex Trading Forecasts - Euro Dollar is Likely to Fall Further

http://www.dailyfx.com/story/bio1/Forex_Trading_Forecasts___Euro_1219242386112.html

The once resilient Euro zone economy is slowly succumbing to the downward pressures of a strong euro, a slowing global economy and tight credit conditions. Looking ahead, I expect the EUR/USD to fall further and test 1.40 dollars per euro.
The once resilient Euro zone economy is slowly succumbing to the downward pressures of a strong Euro, a slowing global economy, high oil and food prices and tight credit conditions. In fact, in light of such risks, the IMF expects the world’s largest economy, according to 2007 GDP estimates, to grow at a very poor 1.7% pace in 2008 and 1.2% in 2009, compared to 2.6% in 2007. The main reason why the European Central Bank is not cutting rates already is because inflation is well above a level consistent with price stability and the central bank wants to avoid second-round effects of energy prices in wage and price setting. In fact, July CPI figures grew at a record pace of 4.1% and risks to price stability over the medium term remain on the upside, according to the European Central Bank president Jean-Claude Trichet.

EUR/USD Could Test 1.40 in 3 months

The euro has been very weak over the past month and I expect this down trend to continue going forward. To some extent the euro dollar up trend has been damaged by a significant shift of interest rate expectations in favor of rate cuts by the ECB and rate hikes by the Fed. In one hand, traders expect the Federal Reserve to increase rates by 75 bps over the next eight FOMC meetings, according to overnight index swaps traders. On the other hand, despite the fact that Jean Claude Trichet said he has no bias going into the next meeting, interest rate traders expect the ECB to cut rates by 50 bps in 2009. Looking ahead, I expect the EUR/USD to test 1.40 dollars per euro in 3 months.

...more...

Pound Reverses Despite U.K. Retail Sales Rebound, Euro Heavy As PMI Remains In Contraction

http://www.dailyfx.com/story/topheadline/Pound_Reverses_Despite_U_K__Retail_1219314052361.html

The pound jumped over 60 bps on a surprising rebound in U.K. retail sales, reaching as high as 1.8707 before ultimately reversing below 1.8630. Consumer consumption rose 0.8% in July from a record fall of 4.3% the month prior. June’s drop was revised lower from an initial reading of 3.9%, which along with prices rising 1.6% took some of the steam out of the Sterling rally. The breakdown revealed that apparel and household goods purchases rebound from -6.9% and -5.7% to 1.5% and 1.6% respectively.

If domestic growth in the U.K. can remain resilient then the Governor King and the MPC can continue to maintain their neutral bias as the wait for inflationary pressures to ease as they predicted in their quarterly inflation report. The central bank is expecting prices to fall below their 2% target in two years dragged lower by slowing growth. The labor market which lost at least 20,000 jobs the last two months and tight credit conditions remain should weigh on domestic growth going forward. Further contraction could push the economy into a recession, forcing the BoE to take preventive measures.

The Euro traded heavy after reaching as high as 1.4835 on the back of a PMI reading below the 50 boom/bust level for a third straight month. The gauge that tracks spending by business leaders slightly improved to 48.0 from 47.8, but continues to signal weakness in the economy. The pair would reverse earlier gains before finding support at 1.4745. If downside risks continue to grow the ECB will have to start to question their staunch hawkish bias, especially as price pressures continue to ease.

Although the U.S. calendar is full of tier two indicators the total impact from them could present significant event risk for the U.S. dollar. Another week of jobless claims above 400,000 is expected as the labor picture continues to worsen. Indeed, the leading indicators metric is expected to fall 0.2%, signaling further deterioration for the economy lies ahead. Meanwhile the Philadelphia Fed is expected to show a slight improvement but will remain in negative territory. The total message from the economic releases today could be that the U.S. economy is far from rebounding, which should keep the Fed on hold and limit bullish dollar momentum.

...more...

ummm.... errr.... excuse me (waves hand) does anyone really believe these people anymore?

[UpInArms]

23. Financial fears spur dollar retreat

http://www.marketwatch.com/news/story/credit-fears-spur-dollar-retreat/story.aspx?guid=%7BEC000ED9%2DA091%2D4581%2DA425%2D5C72E607417A%7D&dist=morenews_ts

LONDON (MarketWatch) -- The U.S. dollar retreated against most major currencies Thursday, losing ground amid ongoing financial sector worries and a rebound in oil prices.

The Financial Times on Thursday reported that U.S. investment bank Lehman Brothers (LEH: 12.87, -0.86, -6.3%) held secret talks earlier this month to sell
as much as half of its shares to South Korean or Chinese parties but failed to reach agreement with either.

Sharp drops Wednesday by beleaguered U.S. mortgage giants Fannie Mae (FNM: 3.80, -0.60, -13.6%) and Freddie Mac (FRE: 2.73, -0.52, -16.0%) "and talk of more problems at Lehman have rekindled fears about the financial services industry, supporting demand for safe-haven currencies and government bonds," wrote strategists at Lloyds TSB.

That's boosted the Japanese yen and Swiss franc.

Meanwhile, Nymex crude oil futures for October delivery continued to push higher, gaining $1.56 to $117.12 a barrel in electronic trading.

"With Nymex crude now stabilizing above its 200-day moving average, the U.S. dollar has (as would be expected) also started to consolidate its gains against the majors," wrote Simon Derrick, currency strategist at Bank of New York Mellon.

Oil is traded in dollars and a move in one typically fuels an inverse move in the other.

...more...

[Ghost Dog]

36. Nope, not me. n/t

[AnneD]

28. 3 Retirement Rip-Offs

FINANCIAL HEALTH ISN'T just about having enough money to buy the goods and services you want; it's a state of mind. We use words like "freedom" and "independence" to describe what you can achieve through good planning because it's empowering to live within your means, keep out of debt and meet your goals. And that's why fraud is so debilitating: You not only lose money when you're ripped off, but you also lose confidence when you're betrayed. This is particularly true for older people. When seniors get scammed, they often experience acute confusion and shame along with the realization that, since they are beyond their working years, they won't have much chance to rebuild their retirement funds.

Unfortunately, while older Americans are wealthier and probably more financially knowledgeable than ever before, the perpetrators of financial abuse and fraud are more numerous and sophisticated than ever too. As a result, elder fraud, already quite rampant in the United States, is on the rise. While individuals age 60 and over make up about 15 percent of the U.S. population, rip-offs of seniors account for nearly half of all complaints received by state securities regulators, according to the North American Securities Administrators Association. The number of seniors victimized by financial abuse and fraud is 5 million a year and rising, according to the Securities and Exchange Commission.

When you look at the most common investment products and sales practices that scam artists use to defraud seniors, as tabulated by the SEC, NASAA and Financial Industry Regulatory Authority, they fall into three basic groups. First, there are vehicles so complicated that it's hard for inexperienced investors to tell whether their money is heading where it's supposed to or being used improperly. Examples include charitable-gift annuities and variable annuities, equity-indexed CDs, and company-issued promissory notes, all of which can be kosher, but all of which can also easily be manipulated by unscrupulous salespeople. For example, from 1997 to 2001, Robert Dillie used an entity called the Mid-America Foundation to sell at least $52.9 million in charitable-gift annuities to seniors. Dillie told investors that their funds would go into stocks, bonds and money-market accounts. In reality, he had diverted $19.2 million of the investors' money to a hidden account, which he used to blow more than $10 million in Las Vegas, buy himself a $1.6 million house and write himself hundreds of thousands of dollars in checks. (Dillie pleaded guilty to wire fraud, money laundering and transacting in proceeds from a criminal activity; he began serving a 121-month federal prison sentence in 2006.)

Second, there are schemes that promise unrealistically high returns or low risk by going outside regular investing (and regulatory) channels. These include "prime bank" instruments, which allegedly trade on overseas markets; "pump and dumps" of microcap or penny stocks; and my personal favorite, sale-and-leaseback contracts, in which investors are lured into buying faraway but supposedly profitable equipment, such as ATMs or Internet workstations. These machines often turn out to be ridiculously expensive, require service contracts or not exist at all. For instance, 10 years ago Phoenix Telecom, an Atlanta outfit, raised more than $74 million from more than 2,000 mostly elderly investors by selling them pay phones, then leasing back the phones for small monthly payments. Phoenix Telecom promised investors 15 percent annual returns but didn't tell them the company was losing money, had a negative net worth and was dependent on new customers to stay in business. (Phoenix Telecom agreed to an injunction without admitting or denying the SEC's allegations of selling unregistered securities.)

more...

http://www.smartmoney.com/thenewretirement/index.cfm?story=august2008-financial-fraud-and-seniors

This is what happens when you don't have a cop on the beat or a judge in the courthouse.

[AnneD]

29. Airlines to Lay Off Tens of Thousands

The airline industry is set to suffer its biggest wave of job losses since 2001, as carriers prepare to shed tens of thousands of jobs after the U.S. Labor Day holiday in September to cope with high fuel prices.

Airlines have collectively announced plans this year to cut more than 36,000 jobs, according to the Air Transport Association of America, an industry trade group. Most of the cuts will happen in the weeks and months after the summer flying season ends.

By year's end, the work force of U.S. airlines, which numbered 414,600 full-time equivalent employees in June, is projected to have been slashed by between 12% to 15%, according to U.S. Bureau of Transportation Statistics officials. That would be the biggest wave of job losses in the industry since 25% of jobs were lost immediately after the Sept. 11, 2001, terror attacks.

No. 1 carrier American Airlines, a unit of AMR Corp. (AMR), is aiming to cut its full-time equivalent work force by up to 8%. No. 2 United, a unit of UAL Corp. (UAUA), has said it will cut 5,500 jobs by year's end, and Continental Airlines Inc. (CAL), the industry's fourth-largest employer, will shed 3,000 positions, mostly through voluntary buyouts.

more....

http://www.smartmoney.com/breaking-news/ON/index.cfm?story=ON-20080820-000522-1049

For your files Finnfan......

[kickysnana]

34. Next they will secure people to the seats so they need no flight attendents. n/t

[Hugin]

39. The Finnfan Files...

I would watch that show every week.

[Tandalayo_Scheisskopf]

33. A Few Speculators Dominate Vast Market for Oil Trading (David Cho)

Regulators had long classified a private Swiss energy conglomerate called Vitol as a trader that primarily helped industrial firms that needed oil to run their businesses.

But when the Commodity Futures Trading Commission examined Vitol's books last month, it found that the firm was in fact more of a speculator, holding oil contracts as a profit-making investment rather than a means of lining up the actual delivery of fuel. Even more surprising to the commodities markets was the massive size of Vitol's portfolio -- at one point in July, the firm held 11 percent of all the oil contracts on the regulated New York Mercantile Exchange.

The discovery revealed how an individual financial player had gained enormous sway over the oil market without the knowledge of regulators. Other CFTC data showed that a significant amount of trading activity was concentrated in the hands of just a few speculators.

The CFTC, which learned about the nature of Vitol's activities only after making an unusual request for data from the firm, now reports that financial firms speculating for their clients or for themselves account for about 81 percent of the oil contracts on NYMEX, a far bigger share than had previously been stated by the agency. That figure may rise in coming weeks as the CFTC checks the status of other big traders.

Much More: http://www.washingtonpost.com/wp-dyn/content/article/2008/08/20/AR2008082003898.html

First person that feigns surprise at this story gets Death by Noogies. ;-)

[Dr.Phool]

35. Who would have ever thunk it?

:spank: :spank: :spank:

Ow!

[Hugin]

38. I got nuttin'.

:shrug:

I'm not going to waste my time waiting for this to get picked up by someone somewhere and used to win an election.

*sigh* I've become so cynical.

[AnneD]

72. Welcome to the

cynical, bitter arm chair economist for Obama. Our motto: No one listens to us because they think WE'RE the ones that are crazy.

[GliderGuider]

47. Does anyone know what percentage of the world's oil trades on NYMEX?

My understanding is that it's a small percentage, so 11% of a small percentage would seem unlikely to be able to push the market around much all by itself.

Here's a comment on the recent fluctuations in oil prices from an apparently informed commenter at The Oil Drum:

There are very powerful fundamental reasons why the price of oil zoomed up and then had a short term big drop. Probably the most important of the fundamental reasons was that China cut back its purchases sharply in July, after big increases in May and June. I don't have the data in front of me, but they bought something like 6% less in July than in June. That probably accounts for over $20 of the drop in price.

Speculators were probably responsible for extending the highs about $10-$12 and extending the lows about $10-$12.

Speculators never start a move--they always follow, because they are dependent on price moves as signals. At the end of a move up or down, they tend to push the move a little bit farther than it would have gone without them, and this spec-exacerbated part of the move is always short.

And speculators don't damage the economy with these exacerbations of moves, either. What they do is treat oil producers to higher selling prices, and commercial buyers and consumers to lower buying prices, than either would have gotten without speculators in the market.

[Tandalayo_Scheisskopf]

58. My personal opinion of the "Peak Oil" sites is...

That they are stiff with apologists for speculators, hedge funds, astroturfers for Big Oil, and anyone else who is profiting from this market and can use heated rhetoric regarding Peak Oil as a cover for their activities. The credulous who buy into The Imminent Energy Apocalypse are just neo-druidic icing on the cake.

And yes, I am just that cynical. The last eight years have stamped that cynicism into my DNA.

[GliderGuider]

64. You're lucky, in a way

You'll have actual people ready to blame if TSHTF. I'll be limited to blaming geology and biology.

[DemReadingDU]

84. Perhaps China cut back oil purchases due to the Olympics?

Less oil, fewer cars, less pollution/smog makes for clearer sky during the Olympics

:shrug:

[UpInArms]

40. GD Crosspost: Swiftboaters are Attacking Schumer for IndyMac Bank Failure??? WTF???

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x3829832

http://www.reuters.com/article/bondsNews/idUSN2045763020080820?sp=true

WASHINGTON (Reuters) - California's attorney general is reviewing a request by former employees of IndyMac Bancorp Inc to investigate whether a New York senator triggered the bank's collapse by releasing confidential information.

At issue is a much-publicized letter that Chuck Schumer, a Democrat, sent in June to the Federal Deposit Insurance Corp (FDIC) and Office of Thrift Supervision (OTS) questioning the company's ability to survive.

The FDIC took control of IndyMac on July 11 after depositors withdrew more than $1.3 billion over 11 days. It was the third-largest bank failure in U.S. history. At the time, OTS Director John Reich blamed Schumer's letter for causing the run on the bank.

In a letter to Attorney General Jerry Brown last week, 51 former IndyMac workers wrote: "From the day (Schumer's) letter was made public on June 26 until the closure of the bank, a run on the bank took place and the failure became inevitable."

Brown's spokeswoman Christine Gasparac said on Wednesday that his office was reviewing the letter and that a decision on whether to act on it could be made as early as next week.

IndyMac is based in Pasadena, California.

After IndyMac's collapse, Schumer accused the OTS of allowing IndyMac's lending practices to slip. IndyMac specialized in a type of mortgage that often required minimal documents from borrowers.

Copies of the employee letter were distributed to the press by CRC Public Relations whose clients include the National Republican Congressional Committee, National Republican Senatorial Committee and the Republican National Committee.

CRC, based in Alexandria, Virginia, was also linked to a company that published a book questioning 2004 Democratic presidential candidate John Kerry's Vietnam service on a swift boat.

...more...

These jerks have really become a danger to our society - their disgusting lies and smears need to stop. IndyMac's Liar Loans got them in trouble and they were a piece of crap "bank" that came out of Countrywide Mortgage.

[Hugin]

42. Gee, if one person just asking questions can cause a huge bank to fail....

I've got a couple I'm going to start on right away.

[UpInArms]

44. agreed - if the POS was such a house of cards that a "question"

could bring it down, there are way bigger problems than anyone can imagine with our banking system.

[Dr.Phool]

49. Blaming the fire on the guy who called 911 to say he smelled smoke.

[PassingFair]

52. The cautionary tale of the Emperor's New Clothes has no place

in modern America.

We are in a murder the messenger mentality.

Is this what fascism feels like?

:crazy:

[UpInArms]

57. I'm of the opinion that it is Totalitarianism

http://remember.org/guide/Facts.root.nazi.html

Totalitarianism

Totalitarianism is a form of government in which all societal resources are monopolized by the state in an effort to penetrate and control all aspects of public and private life, through the state's use of propaganda, terror, and technology. Totalitarian ideologies reject the existing society as corrupt, immoral, and beyond reform, project an alternative society in which these wrongs are to be redressed, and provide plans and programs for realizing the alternative order. These ideologies, supported by propaganda campaigns, demand total conformity on the part of the people.

Totalitarian forms of organization enforce this demand for conformity. Totalitarian societies are hierarchies dominated by one political party and usually by a single leader. The party penetrates the entire country through regional, provincial, local and "primary" (party-cell) organization. Youth, professional, cultural, and sports groups supplement the party's political control. A paramilitary secret police ensures compliance. Information and ideas are effectively organized through the control of television, radio, the press, and education at all levels.

Totalitarian Regime vs. Dictatorship

Totalitarian regimes differ from older concepts of dictatorship or tyranny. Totalitarian regimes seek to establish complete political, social and cultural control, whereas dictatorships seek limited, typically political, control. Two types of totalitarianism can sometimes be distinguished: Nazism and Fascism which evolved from "right-wing" extremism, and Communism, which evolved from "left-wing" extremism. Traditionally, each is supported by different social classes. Right-wing totalitarian movements have generally drawn their popular support primarily from middle classes seeking to maintain the economic and social status quo. Left-wing totalitarianism has often developed from working class movements seeking, in theory, to eliminate, not preserve, class distinctions. Right-wing totalitarianism has typically supported and enforced the private ownership of industrial wealth. A distinguishing feature of Communism, by contrast, is the collective ownership of such capital.

Totalitarian regimes mobilize and make use of mass political participation, and often are led by charismatic cult figures. Examples of such cult figures in modern history are Mao Tse-tung (China) and Josef Stalin (Soviet Union), who led left-wing regimes, and Adolf Hitler (Germany) and Benito Mussolini (Italy), who led right-wing regimes.

Right-wing totalitarian regimes (particularly the Nazis) have arisen in relatively advanced societies, relying on the support of traditional economic elites to attain power. In contrast, left-wing totalitarian regimes have arisen in relatively undeveloped countries through the unleashing of revolutionary violence and terror. Such violence and terror are also the primary tools of right-wing totalitarian regimes to maintain compliance with authority.

Fascism

Fascism was an authoritarian political movement that developed in Italy and several other European countries after 1919 as a reaction against the profound political and social changes brought about by World War I and the spread of socialism and Communism. Its name was derived from the fasces, an ancient Roman symbol of authority consisting of a bundle of rods and an ax. Italian fascism was founded in Milan on March 23, 1919, by Benito Mussolini, a former revolutionary socialist leader. His followers, mostly war veterans, were organized along paramilitary lines and wore black shirts as uniforms. The early Fascist program was a mixture of left- and right-wing ideas that emphasized intense Nationalism, productivism, anti-socialism, elitism, and the need for a strong leader. Mussolini's oratorical skills, the post-war economic crisis, a widespread lack of confidence in the traditional political system, and a growing fear of socialism, all helped the Fascist party to grow to 300,000 registered members by 1921. In that year it elected 35 members to parliament.

[UpInArms]

45. 10:56 EST - markets doing that Thursday dive thang

Dow 11,335.85 81.58 (0.71%)
Nasdaq 2,361.84 27.24 (1.14%)
S&P 500 1,266.49 8.05 (0.63%)
10-Yr Bond 3.838% 0.039

NYSE Volume 1,261,018,750
Nasdaq Volume 469,579,062.5

10:30 am : After ascending from earlier depths, stocks have succumbed to renewed selling pressure. Nonetheless, the major indices remain off their session lows when the Dow and Nasdaq were down 0.9% and the S&P 500 was down 0.7%.

Though oil prices are off their record high by 23%, they are still up 24% year-to-date, boding ill for consumer discretionary stocks. Still, the apparel retail index (+1.6%) is trading higher this session. The index is being helped by Limited Brands (LTD 19.62, +1.65), which posted better-than-expected earnings per share results for its latest quarter. The upside surprise comes despite another year-over-year drop in quarterly revenues.

Limited cited a challenging economic environment as cause for the slide in sales. Concerns related to the economy have represented stiff headwinds for retailers as consumers contend with rising fuel costs and rising unemployment.

The most recent 4-week moving average for jobless claims advanced to 445,750 from 438,500. Though the level is not at recession-like levels it remains elevated.DJ30 -34.20 NASDAQ -12.02 SP500 -2.99 NASDAQ Adv/Vol/Dec 918/338 mln/1447 NYSE Adv/Vol/Dec 1084/200 mln/1732

10:05 am : Stocks have moved upward to their best level of the session, though all three of the major indices remain in negative ground.

Oil has pared some of its gains to trade below $119 per barrel. Still, the greenback is down 0.7%, according to the Dollar Index. A weaker dollar is helping buoy the price of commodities as the CRB Commodity Index is up 2%.

The leading economic indicators for July dipped 0.7%. Economists were looking for a 0.2% decline. The previous reading was revised upward from a 0.1% decline to the neutral mark.

Separately, the Philadelphia Fed Index improved, posting a reading of -12.7. The consensus called for a -12.6 reading. The prior reading remains at -16.3.DJ30 -44.78 NASDAQ -7.97 SP500 -3.96 NASDAQ Adv/Vol/Dec 942/201 mln/1309 NYSE Adv/Vol/Dec 1049/132 mln/1670

09:45 am : Stocks opened sharply lower, but have pared some of their losses. Only the energy sector (+1.6%) and defensive-oriented utilities (+0.2%) are trading higher.

Oil prices are up sharply to their highest level in about two weeks. Oil is currently trading near $119 per barrel.DJ30 -78.81 NASDAQ -15.44 SP500 -7.11 NASDAQ Adv/Vol/Dec 746/104 mln/1394 NYSE Adv/Vol/Dec 770/81 mln/1854

[AnneD]

83. Time to air up the water wings....

pool opens tomorrow.

[UpInArms]

50. Gold at 10-day high as markets change tack

http://www.reuters.com/article/goldMktRpt/idUSLL69907720080821?sp=true

LONDON, Aug 21 (Reuters) - Gold prices hit a 10-day high on Thursday, fortified by investor buying as oil prices rose, the dollar slipped, equities fell and on expectations of strong physical demand over coming months.

Gold <XAU=> rose to $839.00 an ounce, the highest since August 11, and was up at $837.90/839.90 an ounce at 1453 GMT from $810.35/811.75 an ounce late in New York on Wednesday.

A softer dollar and geo-political concerns were the key drivers behind the short-term correction within what is an overall bear market, said Dresdner Kleinwort consultant Peter Fertig.

"In the medium term, the dollar is going to strengthen again against the euro and that is going to weigh, not only on crude oil, but also on gold," he said.

Oil CLc1 rose to over $121 a barrel after Russia responded angrily to a U.S. missile shield agreement with Poland, raising the threat of a supply disruption from the huge energy producer.

<snip>

The firmer dollar in recent months has pulled gold down by around 20 percent from its all-time high of $1,030.80 an ounce hit in March, and a lower price has attracted buying.

...more...

[UpInArms]

51. S&P: More downgrades possible for U.S. banks

01. S&P's rating action on banks, brokerages to be selective
11:42 AM ET, Aug 21, 2008

03. S&P: More downgrades possible for U.S. banks
11:41 AM ET, Aug 21, 2008

[Joanne98]

53. UBS to hold split talks

http://www.efinancialnews.com/homepage/content/2451589688

[Ghost Dog]

55. (Early morning in Europe) GLOBAL MARKETS-Stocks, dollar fall on fresh financial concerns

Thu Aug 21, 2008 4:05am EDT
LONDON, Aug 21 (Reuters) - World stocks and the dollar fell on Thursday after concerns grew about the fate of U.S. mortgage firms and the health of the broader financial sector, while a weak dollar helped oil and commodities extend rebound.

On Wednesday, investors dumped Fannie Mae (FNM.N: Quote, Profile, Research, Stock Buzz) and Freddie Mac (FRE.N: Quote, Profile, Research, Stock Buzz) on fears of an imminent government bailout, knocking the shares to their lowest in nearly 20 years.

Reports on major banks kept alive general financial sector concerns. Wall Street Journal said the Federal Reserve called Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz) last month to see if it had pulled a credit line from Lehman Brothers (LEH.N: Quote, Profile, Research, Stock Buzz), while the Financial Times reported both Chinese and Korean investors walked away from a possible deal to buy Lehman shares.

Oil prices rose above $116 a barrel, renewing inflation concerns. "Inflation fears are back, on top of worries surrounding the fate of Freddie Mac and Fannie Mae, fears of additional writedowns, etc. etc. People are getting nervous again," said Rik Zwaneveld, trader at AFS Brokers, in Amsterdam.

The FTSEurofirst 300 index fell 1.2 percent while the MSCI main world equity index .MIWD00000PUS lost 0.3 percent.

Asian shares outside Japan .MIAPJ0000PUS fell 1.6 percent.

/... http://www.reuters.com/article/marketsNews/idINLL15761320080821?rpc=44&sp=true

[Ghost Dog]

56. Nikkei ends at near 5-month low, exporters sold

Thu Aug 21, 2008 2:49am EDT
TOKYO, Aug 21 (Reuters) - The Nikkei average fell 0.8 percent to its lowest close in nearly five months on Thursday as worries about the health of the global economy and a firmer yen put pressure on exporters such as electronic parts maker Kyocera Corp (6971.T: Quote, Profile, Research, Stock Buzz).

The market's fall was cushioned by gains in energy-linked shares including trading houses and oil and gas field developer Inpex Holdings (1605.T: Quote, Profile, Research, Stock Buzz) after oil prices moved up near $116 a barrel.

With many investors keeping to the sidelines amid uncertainty surrounding the fate of top U.S. mortgage firms, index futures trades by only a handful of participants were having the biggest impact on the market, traders said.

/... http://www.reuters.com/article/marketsNews/idCAT26890720080821?rpc=44

[Ghost Dog]

59. (Europe close) Rising oil, banking worries hit European stocks

Thu Aug 21, 2008 11:39am EDT
LONDON/FRANKFURT, Aug 21 (Reuters) - European shares fell to their lowest close since Aug. 4 on Thursday, pressured by persistent financial sector worries and a rising oil price, which reignited inflation fears.

Commodity stocks limited losses as miners tracked higher metal prices and heavyweight energy stocks gained from the rise in crude.

The FTSEurofirst 300 index of top European stocks provisionally ended down 0.86 percent at 1,155.28 points.

HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) was the biggest negative weight on the index, falling 2.8 percent, while Santander (SAN.MC: Quote, Profile, Research, Stock Buzz), Intesa SanPaolo (ISP.MI: Quote, Profile, Research, Stock Buzz), BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz), Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) and ING (ING.AS: Quote, Profile, Research, Stock Buzz) fell 2.3-3.7 percent.

Oil CLc1 jumped nearly $6 a barrel to well above $121 on geopolitical tensions, the dollar's slide and concern that Tropical Storm Fay might yet threaten energy infrastructure in the Gulf of Mexico.

BP (BP.L: Quote, Profile, Research, Stock Buzz) and Royal Dutch Shell (RDSa.L: Quote, Profile, Research, Stock Buzz) rose 1.2 percent and 1.8 percent respectively.

"The focus remains on the financial crisis. There is still a lot of uncertainty. The hope for stabilisation gets postponed from quarter to quarter and the overall market can't recover until there is clarity," said David Pieper, analyst at German bank LBBW.

/.. http://www.reuters.com/article/marketsNews/idCALL20027920080821?rpc=44

[Ghost Dog]

62. ADR Report-ADRs mixed as credit jitters offset energy

Thu Aug 21, 2008 12:11pm EDT
NEW YORK, Aug 21 (Reuters) - Overseas shares traded in the United States were mixed on Thursday, as renewed credit jitters weighed on financial companies worldwide while a rebound in higher crude and metal prices boosted commodity-related companies.

Global bank HSBC's ADRs (HSBA.L: Quote, Profile, Research, Stock Buzz) (HBC.N: Quote, Profile, Research, Stock Buzz) shed 2.2 percent to $75.66, while ADRs of Europe's biggest insurer Allianz SE (ALVG.DE: Quote, Profile, Research, Stock Buzz) (AZ.N: Quote, Profile, Research, Stock Buzz) fell 1.6 percent to $15.52.

ADRs of Kookmin Bank, South Korea's top retail lender, (KB.N: Quote, Profile, Research, Stock Buzz) (060000.KS: Quote, Profile, Research, Stock Buzz) fell 4 percent to $56.09 and India's ICICI Bank (IBN.N: Quote, Profile, Research, Stock Buzz) (ICBK.BO: Quote, Profile, Research, Stock Buzz) fell 6.5 percent to $29.06.

Energy stocks rose on higher crude prices, which traded above $120 a barrel. BP (BP.L: Quote, Profile, Research, Stock Buzz) (BP.N: Quote, Profile, Research, Stock Buzz) rose 1.2 percent to $58.17. Miners including BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) (BHP.N: Quote, Profile, Research, Stock Buzz) rose 2.1 percent to $70.91.

The Bank of New York Mellon's index of leading American Depositary Receipts (ADRs) .BKADR was effectively flat, at up 0.03 percent while the 30-share Dow Jones industrial average .DJI fell 0.6 percent.

The Bank of New York Mellon's index of leading European ADRs .BKEUR was up 0.07 percent. In Europe, shares were slightly lower as gains in commodity stocks offset declines in banks.

ADRs of Ericsson (ERIC.O: Quote, Profile, Research, Stock Buzz) (ERICb.ST: Quote, Profile, Research, Stock Buzz) rose 3.4 percent, a day after news the company and STMicroelectronics (STM.PA: Quote, Profile, Research, Stock Buzz) (STM.N: Quote, Profile, Research, Stock Buzz) agreed to combine their wireless chip and software businesses, strengthening their hand against competitors to supply the likes of top cellphone maker Nokia (NOK1V.HE: Quote, Profile, Research, Stock Buzz). STMicroelectronics ADRs rose 2.7 percent to $12.53.

The Bank of New York Mellon's index of leading Asian ADRs .BKAS fell 0.8 percent. Hong Kong shares ended lower as hopes faded that Beijing will imminently launch a package to stimulate the economy

Higher oil prices sent energy companies with refining interest lower, including PetroChina (0857.HK: Quote, Profile, Research, Stock Buzz) (PTR.N: Quote, Profile, Research, Stock Buzz). Stronger oil prices hurt profits for Chinese refiners because the government caps petroleum product prices, preventing them from fully passing on crude price increases. PetroChina's ADRs fell 1.4 percent to $125.74.

Concern about the global economy weighed on the ADRs of exporters, including Japan's Kyocera Corp (6971.T: Quote, Profile, Research, Stock Buzz) (KYO.N: Quote, Profile, Research, Stock Buzz). Kyocera ADRs fell 1.2 percent to $82.43.

Receipts with the Bank of New York Mellon's index of leading Latin American ADRs .BKLA rose 0.9 percent. In Latin America, major benchmarks were mixed.

ADRs of Petroleo Brasil (PBR.N: Quote, Profile, Research, Stock Buzz) (PETR4.SA: Quote, Profile, Research, Stock Buzz) rose 4.2 percent to $53.80, as oil rose. ADRs of Vale (VALE5.SA: Quote, Profile, Research, Stock Buzz) (RIO.N: Quote, Profile, Research, Stock Buzz), one of the world's largest diversified mining companies rose 2 percent to $27.44 as a weaker dollar sparked a rally in dollar-denominated commodity prices.

/... http://www.reuters.com/article/marketsNews/idINN2143269320080821?rpc=44&sp=true

[Joanne98]

60. CME and NYMEX to merge

http://www.grainnet.com/articles/CME_Group_and_NYMEX_Holdings_Gain_Shareholder_Approval_for_Proposed_Merger-61979.html

CME Group and NYMEX Holdings Gain Shareholder Approval for Proposed Merger
Date Posted: August 20, 2008

Chicago and New York—CME Group Inc. (NASDAQ: CME) and NYMEX Holdings, Inc. (NYSE: NMX) announced August 18 that preliminary results indicate the shareholders of both companies have approved the proposed merger of CME Group and NYMEX Holdings, Inc. based on a review of the proxies voted at special meetings by the parties' respective proxy solicitors.

In addition, preliminary results also show that NYMEX Class A members have voted to approve the related proposals in a separate member vote.


"We are pleased that shareholders of both exchanges have given their support for this transaction," said CME Group Executive Chairman Terry Duffy.

"The addition of NYMEX to CME Group creates an even stronger international company as we continue to grow our business globally and compete with exchanges and the over-the-counter market.

"The combination of these exchanges will create immediate and long-term value for our shareholders and customers as we are now the only exchange to offer access to every global benchmark product.

"On behalf of CME Group's Board of Directors, I want to thank the shareholders, members and hard-working employees of both exchanges for their support throughout this process."


"Today's votes bring us one step closer to combining our two great exchanges which will allow us to deliver more value to our customers and shareholders," said NYMEX Holdings, Inc. Chairman Richard Schaeffer.

"We look forward to building on our shared legacies through product innovation and industry leadership to capitalize on the terrific growth opportunities we see in this global marketplace."

"We are very pleased that our shareholders, members and customers have overwhelmingly supported and approved the combination of our two great companies," said Craig Donohue, CME Group Chief Executive Officer.

"Today's approval provides us with tremendous new global growth opportunities in both listed and over-the-counter derivatives markets, and further enhances CME Group's leading position in global financial markets.

"Following the closing of this transaction, which we expect to occur this Friday, we will begin executing our detailed integration plan to achieve significant cost synergies and operational efficiencies for our shareholders and customers.

"We also look forward to building our presence in New York City to support growth across all CME Group businesses."


"We appreciate the support from our shareholders and members for combining these two great organizations.

"Our focus now is on further integrating our organizations and building on the success of our 2006 transaction processing agreement for continued growth and innovation," said NYMEX Holdings, Inc. Chief Executive Officer James Newsome.

The companies anticipate the transaction to close on Friday, August 22.

The combined companies will provide customers around the world with access to all major benchmark asset classes, including interest rates, equity indexes, foreign exchange, energy, agricultural commodities and metals.

For more information, call 312-930-8189.

[AnneD]

63. 5 Sneaky Overdraft Traps

To boost revenue, many banks have jacked up fees and reworked policies to maximize the potential for overdrafts, putting even the most diligent account holders at risk, says Jean Ann Fox, director of financial services for the Consumer Federation of America. "You can get in the hole for hundreds of dollars before you even know it," she warns.

Indeed, financial institutions collected more than $17.5 billion in overdraft fees last year, reports the Center for Responsible Lending, a nonprofit policy group.

At the heart of the revenue stream: so-called courtesy overdraft policies, which allow banks to pay charges that would otherwise bounce. Instead of incurring an insufficient funds fee, account holders must pay an overdraft fee and reimburse the bank for the borrowed funds. Even worse: Most banks use software to single out and pay overdrawn funds without regard to the account holder's ability to pay back the overdraft and its associated fees. "It's the only form of credit that can be involuntarily imposed on you," says Chi Chi Wu, staff attorney at the National Consumer Law Center. "They've laid this tripwire, and there's no point to it except to generate fees."

Here are five ways a bank might try to trip you up with pricey overdrafts, plus advice on how to avoid them:

More.....

http://www.smartmoney.com/deal-of-the-day/index.cfm?story=20080818-overdraft-tips

Wonder when they will start giving you free condoms when you open a checking account.:eyes:

[Joanne98]

65. Margaret Whitman bailing out of Ebay as fast as possible..

Interestingly, EBay exploded higher in 2003 exactly coinciding with the peak of silliness in the housing boom. This should not be surprising. People were looking to unload garbage from their old house and/or find stuff for their new house, or simply to shed some accumulated junk for money.

While those looking to shed accumulated junk is likely rising, willingness for buyers to purchase said junk is waning faster.

A quick check on Yahoo!Finance shows EBay to be sporting a PE of $65.59 with a market cap of $32 billion. Is Ebay a value play? A growth play? The answer is neither.

Insiders Bailing As Fast As Possible

Margaret Whitman is bailing as fast as humanly possible.
http://globaleconomicanalysis.blogspot.com/2008/08/ebay-cuts-fixed-price-fees-by-70.html

Chart at link

[AnneD]

66. World's Best and Worst Developed Markets

THE SNEEZE THAT IS the meltdown in the credit, housing and financial markets in the U.S. has become a nasty cold for the rest of the developed world. If there's some solace to be found it's that as bad as domestic equity returns have been so far this year, most countries have fared much, much worse.

That's small comfort for investors who followed the well-worn advice to allocate substantial parts of their portfolios to foreign stocks. Of the 26 countries tracked by the S&P/Citigroup BMI World index, comprised of equities in developed markets, not a single nation has posted a positive total return in 2008. (See chart below.) Emerging markets have fared better but are still down year to date.

That's not to say that allocating to foreign equities is a mistake; indeed, it remains an important and wise strategy for any long-term portfolio. But shorter term it's clear that plunging into developed world equities at the first sign of U.S. weakness offered no defense at all. Only tiny Luxembourg (helped in no small part by the resilience of steel giant Arcelor Mittal (MT: 78.11, +0.43, +0.55%)) and Switzerland (thanks mightily to its currency) have fared better than the U.S. Even Canada, which was riding the materials and energy boom, is off nearly 11% this year.

The global economy may have long remained resilient despite U.S. weakness, but the data show that that meant little for equity returns. That makes Thursday's report from the European Union's statistics agency even more troubling: Gross domestic product declined in the 15-nation euro zone for the first time since the early 1990s.

more....

http://www.smartmoney.com/ticked-off/index.cfm?story=20080815-global-markets

I read a lot of foreign press, and lately it has been fairly negative, even in the hot spots. I read India press and some Chinese-they are slowing down and their middle class is almost as hard pressed as we are. This article doesn't cover those spots, but still some good info here.

[Joanne98]

69. National Banks Fall

Here's how national banks performed in afternoon trading:

JPMorgan Chase & Co. fell $1, or 2.7 percent, to $36.

Wells Fargo & Co. lost 40 cents to $28.52, while Bank of America Corp. shed 60 cents, or 2.1 percent, to $28.69.

Washington Mutual Inc. fell 14 cents, or 3.4 percent, to $3.96.

Wachovia Corp. dropped 50 cents, or 3.4 percent, to $14.40.

Citigroup Inc. fell 29 cents to $17.20.



http://biz.yahoo.com/ap/080821/national_banks_sector_snap.html?.v=1

[InkAddict]

86. Citigroup Screws Over Consulting Firm after 50 new hires.

http://columbus.craigslist.org/bus/797129552.html

Seeking a Project Lead for a contract position starting at 6 months with the possibility to extend until 2010. Looking for a Project Lead to lead a large team of BAs and QAs. Project Management background preferred. Looking for financial backround: banking, investment firms, financial industry, mutual funds, trading and accounting software, etc. Looking for someone to start immediately! Need someone to start as soon as Monday. Will hire immediately. Citizens, Green Cards and H1 Visa's ok! Must have great communication!
Competitive rate.

Location: Columbus OH
Compensation: Competitive Rate
This is a contract job.
Principals only. Recruiters, please don't contact this job poster.
Please, no phone calls about this job!
Please do not contact job poster about other services, products or commercial interests.

This appeared on Craig's List Columbus, OH on August 14, 2008, but my husband, out of work since Chase closed down his project, responded to a similar posting on the San Francisco Craig's List board on August 1. Within hours of sending off his resume, the consulting firm responded enthusiastically with a verbal dollar offer and a scheduled interview for Aug 6. It went well and a firm (non-contingent) offer letter including salary and signup for benefits were exchanged, with the project to begin by Sept. 2, 2008.

GOT THE CALL TODAY - AIN'T GONNA HAPPEN! The client, Citigroup, has placed the project on an indefinite hold (something about 3rd quarter results).

Here's the kicker - 50 people were hired for this project; dozens turned notice to accept a slot on the team; several have already moved to the Columbus area from out-of-state; others were in the process of moving.

Think I need a Bombay Sapphire (gin) and 7-Up!

[Joanne98]

70. Silver State Bank 50 cents a share (Andrew McCain)

SILVER STATE BANCORP(NasdaqGS: SSBX)
NEW Real-time: 0.50 0.08 (13.48%) 1:35pm EThelp
Last Trade: 0.50
Trade Time: 1:23PM ET
Change: 0.08 (13.69%)
Prev Close: 0.58
Open: 0.5905
Bid: 0.50 x 6200
Ask: 0.52 x 200
1y Target Est: 22.00
Day's Range: 0.49 - 0.59
52wk Range: N/A
Volume: 343,984
Avg Vol (3m): N/A
Market Cap: 7.58M
P/E (ttm): N/A
EPS (ttm): -4.233
Div & Yield: N/A (N/A)

http://finance.yahoo.com/q?s=SSBX

[AnneD]

73. If history repeats itself....

John McCain has won the election :crazy:
How can it be propped up til November.

[ozymandius]

85. time to say g'night

Dow 11,430.21 Up 12.78 (0.11%)
Nasdaq 2,380.38 Down 8.70 (0.36%)
S&P 500 1,277.72 Up 3.18 (0.25%)
10-Yr Bond 3.8380% Up 0.0390
NYSE Volume 4,088,453,750
Nasdaq Volume 1,572,599,250

4:25 pm : Despite resurging commodity prices, the stock market concluded Thursday with a fair gain. All three of the major indices opened lower and traded with sizeable losses, but were able to close well above their lows.

Crude climbed as much as 5.6% to eclipse the $122 per barrel mark. That's the highest price crude has seen in two weeks. Crude prices remain more than 21% below their 52-week high.

The CRB Commodity Index also made a strong advance, climbing 3.7% for the session. Commodities, in general, were helped by a weaker dollar. The dollar shed 1.1% against a basket of major foreign currencies.

The dollar has gained strength during recent sessions as concerns regarding the health of the world economy weighed on currency traders.

While the U.S. economy continues to slog along, data is not at recession-like levels. Initial jobless claims for the week ending Aug. 16 fell 13,000 to 432,000, which is below the 440,000 claims economists forecast. The 4-week moving average for jobless claims remains elevated, advancing to 445,750 from 438,500.

Trading volume was relatively light as there were no market-moving earnings releases. Still, Limited Brands (LTD 20.28, +2.31) and H. J. Heinz (HNZ 51.99, +0.28) reported positive upside EPS surprises. Shares of LTD jumped, reflecting the good news.

Weakness was apparent in large-cap financials and large-cap tech stocks, though they finished off their respective lows. Investment banks concluded the session with a 0.6% loss after being down as much as 2.8%, thanks to help from Merrill Lynch (MER 24.34, -0.07) and Lehman Brothers (LEH 13.72, -0.01). Merrill is reportedly scheduled to meet with a Korean sovereign wealth fund and Bloomberg.com reported Singapore's state-owned fund, Temasek, may increase its stake in shares of MER. Temasek is already the largest shareholder.

Lehman Brothers was upgraded to Buy from Neutral at brokerage firm Ladenburg Thalmann. However, an analyst from Citigroup cut earnings estimates for Lehman Brothers, Goldman Sachs (GS 156.42, -1.83), and Morgan Stanley (MS 37.06, -0.34), according to Reuters.

Weakness in Intel (INTC 23.05, -0.34) and Apple (AAPL 174.29, -1.55), along with other large-cap tech names, weighed on the tech-rich Nasdaq. However, it closed off its session low, which equated to a 1.2% loss.

Strength in oil companies Exxon Mobil (XOM 80.35, +1.54) and ConocoPhillips (COP 85.05, +4.20) helped the Dow and S&P 500 outperform the Nasdaq. The Dow and S&P 500 were down 0.9% and 0.7% at their lows, respectively, before finishing in positive territory.DJ30 +12.78 NASDAQ -8.70 NQ100 -0.3% R2K -0.9% SP400 +0.1% SP500 +3.18 NASDAQ Adv/Vol/Dec 1041/1.56 bln/1715 NYSE Adv/Vol/Dec 1363/912 mln/1752