STOCK MARKET WATCH, Monday October 8

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday October 8, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 470 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2467 DAYS
WHERE'S OSAMA BIN-LADEN? 2179 DAYS
DAYS SINCE ENRON COLLAPSE = 2140
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 October 5, 2007

Dow... 14,066.01 +91.70 (+0.66%)
Nasdaq... 2,780.32 +46.75 (+1.71%)
S&P 500... 1,557.59 +14.75 (+0.96%)
Gold future... 747.20 +3.40 (+0.46%)
30-Year Bond 4.87% +0.10 (+2.18%)
10-Yr Bond... 4.64% +0.12 (+2.59%)






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

September Employment Rebound Lifts Market
BY CHRIS PUPLAVA

As was expected, employment in September rebounded and the decline seen in August payrolls of 4,000 jobs was revised into a gain of 89,000 jobs. The large August revision stemmed from a revision in the government sector where the initial job loss of 28,000 jobs turned into a gain of 57,000 jobs after the revision. On the negative side, goods-producing payrolls weakened as the manufacturing sector of the economy continues to slow. The year-over-year (YOY) growth rate for goods-producing payrolls fell to -1.33%, while service-producing payrolls declined to +1.693%.

-chart-

Delving further into the employment data shows that the birth-death model adjustment was responsible for the turnaround in August employment. The birth-death model (BDM) added 120,000 ficticious jobs in August, and backing out the BDM adjustment would have led to a decline of 31,000 jobs for the month. The BDM adjustment for September payrolls was much smaller, coming in at 17,000 jobs.

-chart-

The large gyrations seen in the government’s employment data are due to the relative roll of the BDM. Over the last twelve months, the BDM has accounted for 69% of the job creation in this country. It is a scary thought when 69% of the jobs created in the most widely-used employment data set are statistically made and suspect to large revisions.

-cut-

At either rate, instead of looking at the day-to-day or month-to-month data, those in the financial markets should be looking at the trend to tell them where things are going. The smoothing out of the data by looking at the YOY rate tells you where things are trending and helps remove the day-to-day noise. Virtually every employment indicator is pointing in the same direction, down. Not only are employment trends decelerating but they are also showing no signs of turning around either.

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

[Viva_La_Revolution]

9. 69% of reported jobs are fictitious. oh my. nt

[Demeter]

19. And The Rest are Held by Bushbot Stooges Who Do Nothing

and that's why we're at this crisis point today, boys and girls...

[ozymandius]

24. Even worse: economic policy is based on these statistics. n/t

[Roland99]

21. But Frat Boy said on the TV that this was "good news for Muricans"

[ozymandius]

2. no goobermint reports today

[ozymandius]

3. Oil prices slip below $81 a barrel

SINGAPORE - Oil prices slipped lower Monday in Asia on renewed concerns an impending economic slowdown could dent demand for crude and petroleum products.

Light, sweet crude for November delivery fell 39 cents to $80.83 a barrel in Asian electronic trading on the New York Mercantile Exchange by midmorning in Singapore. The contract fell 22 cents to settle at $81.22 a barrel Friday in New York.

The global credit squeeze is a "serious crisis" that is not over yet and is "going to have an impact on growth," IMF's outgoing head Rodrigo de Rato said in a Financial Times interview published Monday. It could be "a few months, probably into next year" before financial markets recover, he said in remarks about the aftermath of the subprime mortgage crisis in the U.S.

-cut-

Oil prices have been volatile in recent days as investors have debated whether demand for oil and petroleum products will be strong enough in the fourth quarter to support crude oil at $80 a barrel. Some argue declines in refinery activity and heating oil inventories suggest supplies of heating and crude oil will be tight when heating season demand begins to grow.

At the end of the third quarter, many U.S. refineries shut down for maintenance and regear their operations to turn out more home heating oil for the Northern Hemisphere winter. The refineries could start returning to production as early as this month and that ramp-up could increase demand for crude oil.

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

[Buttercup McToots]

4. Can someone convert this to English?

Read this post on another forum....How will new rules affect the price of stocks


October 15th

Readers here is why October 15th is a historic date for all stocks. On this date a major countdown begins for failed to delivers. This will change the entire markets!

SEC Regulation SHO sets out rules governing short sales, including the mandatory close-out requirement that applies to securities in which a substantial amount of fails to deliver have occurred (�threshold securities�). Clearing agency participants and broker-dealers for which they clear positions (�participants�) must take immediate action to close out a fail to deliver position in a Threshold Security that has lasted for 13 consecutive settlement days by purchasing securities of like kind and quantity (�close-out requirement�).

The amendment eliminates one of the exceptions to the Close-out Requirement for fails to deliver established prior to a security becoming a Threshold Security (�grandfather provision�). The amendment requires Participants to close out any previously-grandfathered fails to deliver in a security that is on the Threshold Security List on October 15th. The close-out must occur within 35 consecutive settlement days of October 15th. If a security becomes a Threshold Security after October 15th, all fails to deliver must be closed out within 13 consecutive settlement days.

SEC Link: http://tinyurl.com/2ofmao

Regulation SHO Pilot Security List

"To assist firms with compliance, NASDAQ added all NASDAQ-listed securities to the Regulation SHO Pilot List and maintained the list on line. To further accommodate firms, NASDAQ, will continue to maintain the list for the Reg SHO price test change until October 4, 2007. In addition, effective October 5, 2007, broker-dealers will no longer be able to mark sales �short exempt�; instead all short sales must be marked �short�."

Regulation SHO Threshold Security List Might find some trading jewels listed

[ozymandius]

8. This seems to impact clearing houses and brokers.

I cannot claim to know the full extent of what this policy change means. The most immediate practice that I am aware of are the dishonest "fails to deliver" and slow "close out" procedure that some brokers will perpetrate against their customers. I think this policy change has more to do with market automation rather than anything altruistic toward the general public.

The scenario: a broker will take a sell order. They will mark the order down on paper and send it through the channels to be processed - or sold - then to be "cleared" through one of the major investment banks. The client's money, minus the broker's commission, should then be disbursed. Only it does not always happen this way. A broker can always sit on an order after removing the requested shares from the client's portfolio prior to sending the "sell" request to the exchange. Since these free-floating shares are still free to be traded, the brokerage can then hold and then sell these shares if they believe the value will rise in the next few days or hours. The difference in the selling price between the time the client requests to sell these shares, and when the brokerage sells these shares is then pocketed by the brokerage. The client still gets their money. However the delay works in the brokerage's favor.

The exceptional element about the Nasdaq is the new computer automation systems they have installed. It's paperless. It's also fast. The policy change appears to follow the technology rather than technology following policy.

Just my two cents.

[MattSh]

36. Regulation SHO

Has to do with naked shorts, ie, selling shares of stock that don't exist. Naked shorting is widely believed to have led to the stock market crash of 1929. The following explains the process, though I don't know how it relates to your post.

NAKED SHORTING

In its simplest terms, naked shorting involves selling shares of stock that don’t exist. It’s performed routinely by market-makers to keep an orderly market, but it is illegal when done to manipulate a company’s stock price. Only when someone intends to drive down the stock price is naked shorting breaking the law. Throughout the rest of this overview, any reference to naked shorting will refer to the illegal variety.

It’s also worth noting the important distinction between shorting and naked shorting. The former is perfectly legal and occurs extensively as either a way for an investor to mitigate risk or as a bet that a company’s share price will decrease (i.e. the short-seller or “short” believes the company is overvalued). Despite the wary glances often cast upon them, shorts are an essential part of a robust market and are often the first to discover financial fraud, as in the case of Enron.

A short will sell borrowed shares as a bet against a company because he believes the price will eventually drop. These borrowed shares come from his broker, which loans the short a certain number of shares (not dollars). As soon as the short receives the borrowed shares in his account, he sells them immediately for cash, which goes to his brokerage account. The short still has that pesky loan to pay back, though, and does so by waiting for the price of the stock to drop. Then he buys some cheaper shares using money from the same pool of cash he received after the original sale, gives the broker his shares back, and keeps whatever cash is left in his account.

Naked shorts, in contrast, are much more manipulative – they sell short shares that don’t exist and then attempt to actively lower the company’s share price through constant short-selling pressure. By using pretend shares, of which there is an unlimited supply, naked shorts can effectively control the share price through this constant pressure, eventually driving the price of a company’s shares into the basement.

Where do these fake shares come from? Naked shorts can create them out of thin air, depending on your point of view, due to either (a) glaring inefficiencies in the back-office world of certificate transfers, or (b) institutionalized fraud on a massive scale. Either way, the effects can be disastrous for companies who are victimized.

from here....http://www.americanmicrocaps.com/featuredcolumn2.htm

[Demeter]

42. Thanks for the Lesson!

That was mind-boggling and esoteric!

[ozymandius]

5. U.S. stocks head for lower open

NEW YORK - U.S. stocks headed for a lower opening Monday after putting up big gains last week and as investors readied for quarterly corporate earnings reports.

With the Treasury bond market closed for the Columbus Day holiday and no major economic news expected, stock market investors will be looking for any corporate news to guide them.

The third-quarter results being reported will reflect the difficult times some companies have faced — particularly in the financial sector — following upheaval in the credit markets and amid a souring of some home mortgages.

But a sense that corporations are likely to bounce back from some of the concerns that upended credit markets last quarter helped drive stocks higher last week. The Dow Jones industrial average rose 1.23 percent and set a new record, while the Standard & Poor's 500 index hit a record after gaining 2.02 percent last week and the Nasdaq composite index gained 2.92 percent. A pullback isn't unexpected following such gains.

http://news.yahoo.com/s/ap/20071008/ap_on_bi_st_ma_re/wall_street

[Buttercup McToots]

6. Largest Mortgage Fund Freezes all redemptions

Largest Mortgage Fund Freezes all redemptions

http://www.nypost.com/seven/10062007/business/freeze_is_on_at_giant_mortgage.htm

New York



"October 6, 2007 -- Ellington Capital Management, the country's largest mortgage-backed securities hedge fund, sent a letter to investors notifying them that redemptions and withdrawals in two of its funds would be suspended because of a sharp decline in the liquidity of certain mortgage- and asset-backed markets."


"The Old Greenwich, Conn.-based hedge fund, which has $5.2 billion in assets, is considered a bellwether for measuring the health of the mortgage-backed securities market."

[ozymandius]

11. Yikes! Holy caveat emptor Batman!....................n/t

[Buttercup McToots]

7. This is verry interesting...

Officials: Medina house fire was intentionally set


By MIKE GLENN
Copyright 2007 Houston Chronicle


The fire that destroyed the home of Texas Supreme Court Justice David Medina was intentionally set, the Harris County Fire Marshal's Office announced today.

Investigators said they considered the fire as incendiary after ruling out all other accidental causes, such as an electrical short, that could have ignited the June 28 blaze that resulted in about $900,000 in damages to Medina's Spring-area home.

A neighboring house in the neighborhood was also destroyed in the fire, and a third was damaged.

Members of Medina's family have been questioned during the investigation. His wife and one of his children were the only people in the home that night, arson officers said.

"They have been cooperative throughout the interview process," said Dan Given, chief investigator with the fire marshal's office.

At this point, there are no charges pending in the case, officials said.

"This is an active and ongoing investigation," said Harris County Fire Marshal Mike Montgomery.

Nathan Green, a fire marshal investigator on the case, had earlier said six "persons of interest," all of whom are Medina family members or friends, have been identified in the investigation. He had said there were inconsistencies in Medina's and his wife's accounts of where he was the night of the fire. She was at home.

Contacted by telephone on Tuesday, Medina said he would not comment about his whereabouts that night.

The judge also said he was unaware that investigators had identified six people of interest, including family members and friends.

"I was not aware. ... That's quite startling," Medina said, later adding that he had "no idea" if he knew anyone who might have set the house on fire.

He then said, "I'm not going to comment further."

Investigators had said the fire was "very suspicious" in part because a dog detected an accelerant, the Harris County Fire Marshal's Office said on Tuesday.

Detection of an accelerant does not always mean a fire was deliberately set, said Green. But, he said, "more times than not, the presence of an accelerant is indicative of an incendiary, intentionally set fire."

"The dogs did alert that there was something there," said Green, who would not identify what accelerant was found.

The fire, in the Olde Oaks subdivision in northwest Harris County, destroyed Medina's 5,000-square-foot house in the 3500 block of Highfalls. No one was injured, but two firefighters were treated for heat exposure in the blaze, which started around 10:30 p.m. in Medina's garage, Green said.

According to public records, a mortgage company filed to foreclose on the home in June 2006. Green said Medina and the mortgage company reached an agreement the following December. Green said the foreclosure filing on the house was a "very, very big red flag" for investigators.

He said Medina did not have an insurance policy on the home and that the justice, appointed to the Texas Supreme Court in 2004 by Gov. Rick Perry, was surprised when he learned a policy had lapsed.

"It was an oversight on somebody's part that the premiums didn't get paid," said Green, who added the family moved to Austin after they lost their home.

The loan on the house was insured by the finance company, he said.

Green said the only people at the Medina home that night were Medina's wife, Francisca Medina, and one of their children. Green said Medina apparently didn't learn of the fire until the morning after the blaze, around 6:30 a.m. or 7 a.m., and that the judge arrived at the charred house that afternoon.

He said the investigation has not offered Medina any kind of special treatment in the case, but that they "have been mindful" the home is owned by a sitting Supreme Court justice.

"I have not been interfered with in any way in this investigation," Green said.

Chronicle reporter Paige Hewitt contributed to this report.

[ozymandius]

10. Friend of mine once lived in a ramshackle house in a transitional neighborhood.

Once his lease was up - the owner refused to renew for no apparent reason.

About a month after my friend moved out - fire engulfed the home. Nothing but charred pipes and a crumbling brick foundation remained. But - Glory Be! - someone did manage to save the recently purchased refrigerator. It somehow got moved a safe distance from the roaring blaze in the middle of the night.

The lot now hosts a small apartment complex.

[Buttercup McToots]

14. I bet he is pissed...

He said Medina did not have an insurance policy on the home and that the justice, appointed to the Texas Supreme Court in 2004 by Gov. Rick Perry, was surprised when he learned a policy had lapsed.

"It was an oversight on somebody's part that the premiums didn't get paid," said Green, who added the family moved to Austin after they lost their home.

The loan on the house was insured by the finance company, he said.

No insurance money...

[jdog]

17. Interesting...

but if the home is mortgaged to the hilt, and the mortgage is insured... that's the same thing isn't it?

[happyslug]

39. Yes, if he had NO equity in the home.

No, if he had any equity. Equity is defined as the difference between what the house is worth AND what are the mortgages and other liens on the property. i.e. I own a house that is worth $100,000 with an $90,00 Mortgage and no other liens, I have $10,000 in Equity or what I can get if I sold the house.

In this case, the Mortgage was insured, but anything over the value of the Mortgage (and less the value of the Land) is not. You can not, generally, insured the land value, since it is hard to destroy, but any value on the building on the land can be.

Thus, it appears that the Mortgage will be paid in full and the Judge still has the land, but no money to re-build.

[AnneD]

26. Morning Marketeers.....

:donut: and lurkers. A justice appointed by Rick Perry. Why am I not surprised:eyes: As the housing market gets screwy and people get more desperate-look for more of this alternative way to get out of a mortgage.

I decided to reward my daughter for her hard studies (SAT-retest) and we went to the Greek festival at the Annunciation Orthodox Church. The festival has been going on for 41 years-and one that I have attended on many occasions. It was very hot still but as it cools off-we have more festivals than you can shake a stick at. There was a good turnout and much ouzo was drank. I think in my past life I must have been Greek. A college friend swore she once witnessed me carrying on a conversation in Greek with a sailor and a club near the ship channel. I was 3 sheets to the wind and remember nothing but the headache the next day. But she swears it happened. Something similar happened to me Arabic with a patient once. I responded to an arabic womans question before her son translated it to me, but I told the son that she had asked a mom question...no interpretation needed.

And speaking of understanding Greek.....those employment numbers haven't been honest since Ronald Reagan slipped some of his Trojan Horse legislation through years ago. Too many folks left out of the count. As I said before....I'll be watching the revisions:evilgrin:

Happy Hunting and watch out for the bears.

[Li-an]

12. FREEZE IS ON AT GIANT MORTGAGE HEDGE FUND

October 6, 2007 -- Ellington Capital Management, the country's largest mortgage-backed securities hedge fund, sent a letter to investors notifying them that redemptions and withdrawals in two of its funds would be suspended because of a sharp decline in the liquidity of certain mortgage- and asset-backed markets.

http://www.nypost.com/seven/10062007/business/freeze_is_on_at_giant_mortgage.htm

[ozymandius]

13. Mortgage slump hits home decor industry

HIGH POINT, N.C. - Doug Schock shook his head in disbelief while gazing at the empty bank of elevators, typically full as they shuttle thousands of buyers between dozens of showrooms filled with the latest styles in sofas, bedroom sets, and dining room tables and chairs.

Not so this fall at the High Point Market — the twice-annual home decor and furnishings trade show that sets the table for what consumers will see in stores next season.

"Those used to be packed. You used to have to elbow your way into showrooms," said Schock, a territory manager for OneCoast Midwest Home. "I know the economy has been down since 9/11, but the housing slump combined with the weak economy, you have a double whammy."

More than 85,000 industry insiders typically descend on North Carolina for the market, at which thousands of vendors fill 188 buildings and 12 million square feet of showroom space with thousands of new products. While the High Point Market Authority wouldn't release attendance figures for this fall's gathering, it was clear from a walk through the market's winding corridors that the industry is the latest casualty of the ongoing housing and mortgage lending bust.

-cut-

Last year, before troubles in the mortgage lending business accelerated the worst housing downturn more than a decade, the nation's largest furniture stores posted a 6.6 percent increase in sales, said Jerry Epperson, a furniture industry analyst with Richmond, Va.-based investment firm Mann, Armistead and Epperson.

But U.S. consumer spending on furniture and bedding, the broadest measure of industry activity, is expected to grow by just 1.5 percent this year and 2.2 percent in 2008, according to a consensus industry forecast complied by trade journal Furniture Today. That would make 2007 the industry's worst since 2001, when sales declined by 0.6 percent.

http://news.yahoo.com/s/ap/20071007/ap_on_bi_ge/mortgage_mess_furniture

[TalkingDog]

41. The entire Piedmont region is "screwn".

The small town SE of High Point where I'm from used to be full of textile mills. No more. The spousal unit laughed the first time we went to buy sheets imported from ???. The price I was used to paying only got us 100 thread count sheets. I complained that even in the orphanage (not kidding here) the sheets never felt this bad. I was gently reminded that the sheets I slept on as a wee ward of the state were likely high quality 2nds from a local mill.

My Dad's family raised tobacco towards the mountains, very few of them still do. Some have turned to another aboriginal crop: grapes. Some have just gone to general farming, but all of them are struggling to adapt.

The city I work in, Winston-Salem, is struggling with the tobacco downturn. Especially the non-profits that depended on the largess of the industry to keep their heads above water.

Hickory to the west of me used to be a major furniture mfg. Which contributed to High Point's success. All gone...overseas.

I've been doing my best AnnieD imitation and scoping out the scenes. It seems the mid-high dollar places: Starbucks, Whole Foods are doing good business according the various employees I befriend or know. The low-end places, like the shoe repair shop of my cobbler friend (a dying art by the way,) is nigh on shutting down business is so bad. The poor who want to maintain their footware and those with specialzed prescription orthotics, simply don't have the money to spare.


BTW thanks to the regulars on this thread. Economic lingo and intricacies are not my forte. It's good to have translators.

My Favorite Master Artist: Karen Parker GhostWoman Studios

[ozymandius]

15. JPM and BAC to write down $3 billion in loans: report

NEW YORK (Reuters) - JPMorgan Chase (JPM.N) and Bank of America (BAC.N) are expected to disclose losses of about $3 billion in mortgage securities and leveraged loans when they report earnings this month, the Financial Times reported, citing an analyst.

JPMorgan is likely to report mark-to-market losses on leveraged loans of about $1.4 billion and an additional $700 million in write-downs of mortgages and mortgage-backed securities, according to Howard Mason, analyst with Sanford Bernstein, the paper reported.

Mason estimated Bank of America will take write-downs of $700 million for leveraged loans and mortgage write-downs of $300 million, the paper said.

very short

[ozymandius]

16. bidness is being had

9:38
Dow 14,041.38 -24.63 -0.18%
Nasdaq 2,774.97 -5.35 -0.19%
S&P 500 1,553.53 -4.06 -0.26%
10 Yr Bond(%) 4.6380% -0.0020

[Demeter]

18. Hale "Bonddad" Stewart|Powerline: Economic Hacks

http://www.huffingtonpost.com/hale-stewart/powerline-ec...

Hale "Bonddad" Stewart|Powerline: Economic Hacks
Posted October 7, 2007 | 12:31 PM (EST)



The right wing has continually made the argument that the 2003 tax cuts were the primary driver of the current recovery. Powerline's John Hinderacker is the latest purveyor of this myth:

The stock market is at record highs, unemployment continues at historic lows. What's not to like? Of course, one can always question the link between prosperity (or the lack thereof) and government policies. But in President Bush's case, it seems pretty obvious that his tax cuts prevented what could have been a disastrous downward spiral. At a time when our economy was subject to the double-whammy of recession and the bursting of the tech bubble, the terrorist attacks of September 11, 2001 could easily have sent the economy into a tailspin.

The problem with this statement is it gives no mention of the effects of interest rate policy on the US economy. As I will demonstrate, record low interest rates were in fact the primary driver of this economic expansion, not the 2003 tax cuts.

SEE LINK FOR CHART

The chart above is from the Federal Reserve of St. Louis and it is a chart of the effective Federal Funds rate. This is one of the interest rates the Federal Reserve can directly increase or decrease at the Federal Open Market Committee meeting. Notice the Federal Reserve started to aggressively cut the effective Federal Funds rate on January 3, 2001 when they cut the rate from 6.50% to 6%. They continued to cut the rate aggressively for the remainder of the year. The rate dropped to 1.75% on December 11, 2001. There is a standard economic proposition that it takes 12-18 months for interest rate cuts to move through the economy and have their maximum impact. Under this logic, the interest rate cuts would have started to have a complete stimulative effect in the first half of 2003 which is exactly when the US economy started to grow at a decent rate.

Why is there a lag time? There are several reasons. The first is consumers like to wait and see if the drop in rates is a permanent change in Fed policy or a one time event. In order to ascertain the Fed's real policy intentions, consumers need to see more economic data which takes awhile to come out. There is also the issue of when the Fed usually cuts rates. This usually happens when the economy is already slowing or when there is a perception the economy will slow. When this happens consumers are simply more risk adverse and are less likely to take out a loan.

However, the total amount of mortgage borrowing that has occurred as a result of record low interest rates is clear from the following chart.

SEE LINK FOR CHART

According to the Federal Reserve's Flow of Funds total household mortgage debt outstanding has increased from $5.325 trillion in the fourth quarter of 2001 to $10.143 trillion in the second quarter of 2007. In other words, US households have almost doubled their mortgage debt outstanding during this expansion. Econ 101 explains the reasons for this massive increase in debt: when the cost of a product is low, people buy more of it. Interest rates are the "cost of money" -- the amount it takes to borrow funds.

When you add that much money to the economy, it is bound to grow. It's that simple.

So, no John, the tax cuts had jack to do with this expansion. Record low interest rates had everything to do with the latest expansion. Anyone with a economic knowledge knows this. Of course, that would imply you have economic knowledge.

[ProfessorGAC]

23. Well Done

Also, when looking at the UE numbers, they are not even at record lows. That's simply a made-up stat. They were lower in the 90's and in WWII. And, those numbers were counted more rigorously than now.

This guy is, indeed, a hack and a mere water-carrier.
The Professor

[antigop]

20. Wall Street's $20B worth of subprime pain (cross-post from Economy forum)

http://money.cnn.com/2007/10/05/news/companies/wall_street/index.htm?postversion=2007100607
>>
The cost of the subprime crisis continues to mount on Wall Street.

To date, the total stands at nearly $20 billion.

On Friday, Merrill Lynch (Charts, Fortune 500) said it would take a writedown totaling $5.5 billion in large part because of its exposure to subprime mortgages.

Merrill was only the latest bank in recent weeks to reveal how badly its bottom line has suffered from the mortgage meltdown that began over the summer.
>>

[antigop]

22. Commentary: What Citigroup didn't say

http://www.marketwatch.com/news/story/citigroup-didnt-say/story.aspx?guid=%7BDAB55C1C%2DE832%2D410C%2DA4CA%2D34713D0C61EE%7D&siteid=yhoof

>>
When companies issue news releases, sometimes what counts isn't what is said, but what isn't.
With its warning last Monday that third-quarter results will be abysmal relative to expectations, thanks largely to the mortgage meltdown, Citigroup (C:Citigroup, Inc
illustrates the point as well as any company.

Rather than go down, which would be expected when a company says that earnings will be 60% lower than a year earlier, Citigroup's stock went up. Investors appear to have been reassured by Chief Executive Charles Prince's comment that he expects "a return to a normal earnings environment in the fourth quarter."

Citigroup is hardly alone and in fact led a parade of similar warnings culminating Friday with nasty news from Washington Mutual (WM:Washington Mutual Inc) and Merrill Lynch & Co.
As with Citigroup, their stocks went up. This is investor and public relations at its best or worst, depending on your perspective.

Don't be fooled: At many companies like Citigroup, Washington Mutual and Merrill especially when the news isn't good the message is orchestrated with great care and precision. When the CEO is a lawyer, as is Prince, you can bet that every word has been scrutinized. Which raises several interesting points.
>>

[AnneD]

27. So now we have to read the offical news...

Pravda style. We have gained much experience reading Dubya's memos-this should prove interesting.

[antigop]

28. AnneD -- as one who has read corporate PR releases for some time, I can tell you

that I read every press release carefully -- regardless of the company, regardless of the industry, regardless of the topic.

[AnneD]

32. Wise indeed....

Great Granddad always said believe 1/2 of what you see, 1/4 of what you read, and none of what you hear.

[antigop]

37. HA! And with the sorry state of the MSM, maybe those fractions are now even lower? n/t

[ozymandius]

25. numbers and blather

11:09
Dow 14,033.98 Down 32.03 (0.23%)
Nasdaq 2,773.76 Down 6.56 (0.24%)
S&P 500 1,550.79 Down 6.80 (0.44%)
10-Yr Bond 4.638% Down 0.002
NYSE Volume 536,645,375
Nasdaq Volume 486,361,656.25

11:05 am : The major indices have had a slight dip since the last update. The S&P will have a hard time making it back to the unchanged mark without the support of the financial sector.

Merrill Lynch (MER 74.94, -1.73) is the main laggard in the financial sector (-0.5%) this session after being downgraded to neutral at JP Morgan and Credit Suisse this morning. Last Friday, Merrill Lynch announced a net loss for the third quarter of "up to $0.50 per share" due to the credit market turmoil.

On a related note, The Financial Times is reporting that JPMorgan Chase (JPM 47.42, -0.16 ) and Bank of America (BAC 52.40, -0.30) are expected to reveal losses of roughly $3 billion on holdings of mortgage securities and leveraged loans when they report third quarter results. The stock of these companies are managing to perform in line with the sector, as this news did not come as much of a surprise in light of the write-down revelations made by other investment banks recently. DJ30 -19.67 NASDAQ +0.40 SP500 -4.43 NASDAQ Dec/Adv/Vol 1523/1157/411 mln NYSE Vol 192 mln

10:30 am : The major indices have been choppy since the last update. The S&P and Dow continue to trade in negative territory, while the Nasdaq is now holding on to slight gains.

Apple (AAPL 164.58, +3.14), Research In Motion (RIMM 116.71, +3.28) and Google (GOOG 597.95, +4.00) are providing leadership for the Nasdaq this session. The three technology companies continue their good runs as they trade near all-time intraday highs. DJ30 -16.10 NASDAQ +2.47 SP500 -4.24 NASDAQ Dec/Adv/Vol 1433/1160/285 mln NYSE Dec/Adv/Vol 1753/1087/100 mln

[Ghost Dog]

29. Chinese rush to invest in offshore funds

http://news.yahoo.com/s/ft/20071008/bs_ft/fto100820070716377201;_ylt=AuPaa0g37btdbPD7E83h7SH2ULEF

Retail demand for China's first offshore mutual funds has exceeded all expectations and provoked a flurry of new offerings from local and foreign-invested fund managers.
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At least four huge offshore investment funds are expected to launch under Beijing's Qualified Domestic Institutional Investor scheme before the end of the year and over a dozen more are expected next year.

Retail interest in QDII funds is being driven by an overpriced domestic stock market and a lack of investment options at home. But some analysts warn of potentially massive redemptions from the new funds because of their size and because Chinese investors who have seen the domestic stock market jump five-and-a-half times in a little over two years may find returns in more sedate developed markets less than inspiring.

/more...

[Ghost Dog]

30. JPMorgan and BofA poised for total $3bn writedown

http://news.yahoo.com/s/ft/20071007/bs_ft/fto100720071746237130;_ylt=Ar0a36rK.UsSDTWbttIuCSP2ULEF

JPMorgan Chase and Bank of America (NYSE:BAC) are expected to reveal losses of about $3bn on holdings of mortgage securities and leveraged loans when they report third-quarter results this month.
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This would take to more than $20bn the total writedowns announced by the world's leading banks as a result of the credit market turmoil over the summer.

JPMorgan is likely to unveil mark-to-market losses on leveraged loans of about $1.4bn, in line with those reported by Citigroup last week, according to Howard Mason, analyst at Sanford Bernstein. He estimates it will suffer a further $700m of writedowns on mortgages and mortgage-backed securities, for a total of $2.1bn.

For Bank of America, he estimates leveraged loan losses will be $700m and the mortgage writedowns $300m. Merrill Lynch last week said it had suffered $5bn losses. UBS said it had $3.7bn of writedowns, Deutsche Bank $3.1bn and Citigroup $2.7bn. Other banks with smaller capital markets operations such as Wachovia are likely to report writedowns. Last week, Washington Mutual said it would take a hit of $410m on mortgages held for sale, holdings of mortgage-backed securities and losses in its trading business.

JPMorgan and Bank of America are big lenders to private equity firms and the bulk of their writedowns will come from leveraged loan commitments they had intended to syndicate but on which they would take a loss if they sold them now. The two banks were not so active in collaterlised debt obligations composed of bundles of subprime mortgages. This was where Merrill said on Friday it would take a $4.5bn writedown because of the fall in value of the mortgages it had warehoused and the tranches of the CDOs it had retained.

/...

[Ghost Dog]

31. 'Undervalued' dollar rallies

http://news.yahoo.com/s/ft/20071008/bs_ft/fto100820070701457198;_ylt=AnU6UQgJCYyFX9rBag6Naz_2ULEF

Gains for the dollar resumed on Monday following better-than-expected US employment data and comments from the IMF about the "undervalued" currency.

The greenback pushed higher against the euro, sterling and yen, but the calming effect on the foreign exchange market of Friday's unexpectedly strong US non-farm payrolls data encouraged carry trades, lifting the Australian and New Zealand dollars.

The carry trade, where low-yielding currencies like the yen are sold to fund purchases of higher yielding assets and currencies like the Kiwi or Aussie dollars, was back in fashion following some weeks of markets volatility and risk aversion.

...

The New Zealand dollar was up 0.8 per cent against the yen to Y89.74, while the Australian dollar rose 0.5 per cent to Y105.50.

The yen was down across the board. The US dollar rose 0.4 per cent to Y117.40, the pound rose 0.2 per cent to Y239.20, while the euro was up fractionally to Y165.39.

...

The dollar climbed 0.3 per cent to $1.4084 against the euro and by 0.3 per cent against sterling to $2.0365.

/...

[Ghost Dog]

33. Euro ducks 1.41 dollars amid eurozone finance meet

http://news.yahoo.com/s/afp/20071008/ts_afp/forexeurope_071008103223;_ylt=AqqTUhMSV19CaURfcZ683uWmOrgF

LONDON (AFP) - The euro slipped under 1.41 dollars on Monday, as eurozone ministers sat down to discuss the European single currency's recent record strength.

In European deals on Monday, the euro fell to 1.4084 dollars, compared with 1.4134 dollars in New York late on Friday. Elsewhere, the US currency climbed to 117.32 yen from 116.94 yen late on Friday.

The record-breaking euro will be in focus as eurozone finance ministers meet in Luxembourg to hammer out a joint message to take to an upcoming G7 meeting later this month. The euro had hit an historic high of 1.4283 dollars last Monday.

"The Eurozone finance ministers meet on Monday and Tuesday with the euro's impact on the (eurozone) economy likely to be a major topic of conversation," said Calyon analyst Stuart Bennett. "The dilemma for these policymakers is that there is very little they can do to weaken the currency."

Many eurozone countries, led by France, argue that the surging euro hits their economies hardest because it ramps up the cost of their exports.

/...

[Ghost Dog]

34. U.S. downturn worries ease among international investors

http://news.yahoo.com/s/nm/20071008/bs_nm/markets_global_dc

LONDON (Reuters) - Worries about a U.S. economic downturn and its fallout across the world eased on Monday, lifting the dollar and Asian stocks although European shares took a breather after a five-session rally.

"The payrolls numbers have reduced fears that the U.S. economy is heading into recession," said Michael Klawitter, currency strategist at Dresdner Kleinwort in Frankfurt. Data showed the U.S. economy added 110,000 new jobs in September and hiring in each of the two previous months was revised up significantly, showing a more resilient labor market than previously thought. This eased one of the two big concerns of investors at the moment -- that the U.S. economy could slide and pull down growth elsewhere. The second concern -- widespread problems stemming from a credit squeeze -- currently appears contained.

...

Asian stocks outside of Japan, however, hit record highs again in keeping with the flood of money moving into emerging markets since the U.S. Federal Reserve cut interest rates last month. Japan's markets were closed for a holiday.

/...

[Ghost Dog]

35. European shares snap five-day winning run, SAP hit

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-10-08T153834Z_01_L08270520_RTRIDST_0_MARKETS-EUROPE-STOCKS-CLOSER-URGENT.XML

LONDON, Oct 8 (Reuters) - European equities closed lower on Monday and ended a five-day winning streak, as miners tracked falls in base metal prices, and markets punished SAP (SAPG.DE: Quote, Profile , Research) for its biggest acquisition.

Shares in German computer software maker SAP lost 4 percent on analysts' scepticism over its plans to buy rival Business Objects (BOBJ.PA: Quote, Profile , Research), which also issued a warning on its quarterly results. Business Objects rallied 17 percent.

Miners Anglo American (AAL.L: Quote, Profile , Research), Rio Tinto (RIO.L: Quote, Profile , Research) and BHP Billiton (BLT.L: Quote, Profile , Research) shed between 1.9 and 2.6 percent, hurt by a sharp decline in base metal prices, with copper down 3 percent.

The pan-European FTSEurofirst 300 shares index <.FTEU3> ended 0.3 percent weaker at a provisional 1,580.1 after gaining a total of 2.2 percent last week in five straight sessions.

...

"We continue to think that valuations are attractive, sentiment is cautious, and while fundamentals are still risky ... we expect a mid-cycle slowdown environment, not a recession," Morgan Stanley's equity strategists said in a note.

/...

[Robbien]

38. Fullerton County California Executive Sentiment Hits 4-Year Low

Sentiment among the county’s chief executives, business owners and managers fell to 41.5 for the fourth quarter. It marks the third straight quarterly drop in the index, and the first time since the 2003 start of the Iraq war that sentiment has dipped below the 50 mark.

A reading of lower than 50 indicates executives don’t expect growth in the quarter.
. . .

Sentiment first began slipping for the second quarter after concerns about the subprime mortgage market’s meltdown started registering on the minds of executives. The index dropped to 70.6 for the second quarter from 83.1 for the first quarter. At the start of the third quarter the index fell again to 61.9.




http://www.ocbj.com/article.asp?aID=8234452.2607364.1537068.80038202.4253398.603&aID2=118227

[ozymandius]

40. 3:06 numbers and blather

Dow 14,025.53 Down 40.48 (0.29%)
Nasdaq 2,777.42 Down 2.90 (0.10%)
S&P 500 1,550.27 Down 7.32 (0.47%)
10-Yr Bond 4.638% Down 0.002
NYSE Volume 1,432,483,625
Nasdaq Volume 1,174,363,250

3:00 pm : The major indices had made some gains since the last update that were led by the technology sector (+0.4%). Most of the gains, however, were given back shortly before the top of the hour. The Nasdaq Composite was trading in the green, but has since slipped back into negative territory.

Also of note, the slide in oil prices has helped the Amex Airline Index (+0.8%) to outperform this session. The index still has a long way to go to catch up to the rest of the market for the year, it is down 28.8% this year. DJ30 -43.74 NASDAQ -2.55 SP500 -7.45 NASDAQ Dec/Adv/Vol 1775/1132/1.10 bln NYSE Dec/Adv/Vol 2137/1056/561 mln

2:30 pm : The major indices have had a small gain since the last update that has pushed the indices off their session lows. The Nasdaq Composite continues to outperform the other indices and is now trading slightly below the unchanged mark.

Separately, losses in commodities are not limited to just crude oil and gold this session. The CRB Index, which tracks commodities, is down 1.6%. Every commodity group within the index is in negative territory this session. The energy (-2.7%) and grains (-2.0%) groups are the main laggards. DJ30 -39.51 NASDAQ -1.08 SP500 -6.56 NASDAQ Dec/Adv/Vol 1812/1079/1.01 bln NYSE Dec/Adv/Vol 2183/972/510 mln

[ozymandius]

43. closing sentiment: mediocrity is great!

Dow 14,043.73 Down 22.28 (0.16%)
Nasdaq 2,787.37 Up 7.05 (0.25%)
S&P 500 1,552.58 Down 5.01 (0.32%)
10-Yr Bond 4.638% Down 0.002
NYSE Volume 2,076,074,250
Nasdaq Volume 1,547,353,500

4:20 pm : All things considered, the bulls can be pleased with Monday's performance. Coming off a week in which the S&P 500 surged 2.0%, the blue chip average held its ground in admirable fashion, shedding just 0.3% in a halfhearted profit-taking effort.

Participation in today's trade was limited as the Columbus Day holiday, which left the bond market closed, a bout of exhaustion from the market's recent rally, and a wait-and-see attitude ahead of the start of the third quarter earnings reporting period and the release of the FOMC Minutes from the September 18th meeting, kept investors sidelined.

The lack of participation was evident in the low volume at the NYSE and the fairly tight trading ranges the indices were confined to during the trading day.

The Nasdaq, though, continued its outperformance as large-cap tech stocks remained in favor. Google's (GOOG 609.62, +15.57) move above $600 combined with gains in momentum favorites, Apple (AAPL 167.91, +6.46) and Research In Motion (RIMM 117.65, +4.28), provided the winning edge that left the tech sector (+0.7%) as the only sector to record a gain in Monday's session.

Energy stocks comprised the biggest pocket of weakness, as the energy sector (-0.8%) followed crude prices lower. The decline in crude prices (-2.8% to $78.97) was attributed to a rebounding dollar and the belief that warm fall weather in major markets will lead to a build in inventory stockpiles.

The dip in oil prices provided a measure of support for the Dow Jones Transportation Average (-1.2%), but ultimately, it couldn't overcome a third quarter and full-year earnings warning from Ryder System (R 45.92, -3.33). Before the open, the trucking company said soft economic conditions existed in more industries beyond housing and that it expects the soft economic conditions to continue through the fourth quarter.

That was one of the few corporate headlines of note on Monday, although some M&A activity did make news. Specifically, SAP (SAP 56.36, -2.87) said it is going to buy Business Objects (BOBJ 57.83, +7.56) for nearly $7.0 billion; meanwhile, Textron (TXT 64.01, -1.37) is going to acquire United Industrial (UIC 80.39, +4.77) for $1.1 billion. Both deals are cash deals.

On Tuesday the market's attention will be fixed on the minutes from the September 18th FOMC meeting. They will be released at 14:00 ET. Participants will be studying them closely to gain some insight on the discussion that took place leading up to the Fed's decision to cut both the fed funds rate and discount rates by 50 basis points.DJ30 -22.28 DJTA -1.2% NASDAQ +7.05 SP500 -5.01 NASDAQ Dec/Adv/Vol 1675/1246/1.52 bln NYSE Dec/Adv/Vol 2148/1098/844 mln