STOCK MARKET WATCH, Monday October 22

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday October 22, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 456 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2473 DAYS
WHERE'S OSAMA BIN-LADEN? 2193 DAYS
DAYS SINCE ENRON COLLAPSE = 2154
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

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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 19, 2007

Dow... 13,522.02 -366.94 (-2.64%)
Nasdaq... 2,725.16 -74.15 (-2.65%)
S&P 500... 1,500.63 -39.45 (-2.56%)
Gold future... 768.40 -0.30 (-0.04%)
30-Year Bond 4.69% -0.09 (-1.88%)
10-Yr Bond... 4.40% -0.10 (-2.27%)






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

The Fed, The Discount Rate and the Stock Market
BY TIM W. WOOD

The Fed’s action to either raise or lower rates has become a major focal point for the markets, and in light of the fact that we have another Fed meeting coming up at the end of the month, I felt that addressing this subject again is warranted. Based upon the chart that I first presented here in the September 7th Wrap Up, we have entered into an environment in which further rate cutes should be expected. I have updated this chart below.

-chart-

In the upper window of this chart I have included the Discount rate, and in the lower window we have the 3-month T-bill rate along with my Trend Indictor. As explained in the September 7th Wrap Up, the Fed does not lead the credit markets in setting the Discount and Fed Funds rate. In going back to 1946, which is the inception of my data base on these rates, we find that the Fed actually follows the natural short-term direction of rates as is defined by the open market. The Trend Indicator in the chart above can be used to help identify when we have moved into a rate cutting cycle or a rate hiking cycle. The Trend Indicator first rolled over in late June telling us that we had entered into an environment in which lower rates should be expected. It was then in early August that the 3-month T-bill rate began to drop and it was then that the Fed made the first half point cut of the Discount rate from 6.25% to 5.75%. Short-term rates continued to decline and moved well below 3% a bit later in August. This continued decline forced the Fed to follow with yet another half point cut in September. Since that time, short-term rates have rebounded a bit, but are still well below the Discount rate. Also, as you can see, the Trend Indicator remains negative in the wake of its June downturn.

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

[ozymandius]

2. no goobermint reports today n/t

[ozymandius]

3. Oil prices fall below $88 a barrel

SINGAPORE - Oil prices dropped in Asian trading Monday, extending a retreat from last week's $90 a barrel record, as investors sold to lock in profits before contracts expire later in the day.

Light, sweet crude for November delivery lost 99 cents to $87.61 a barrel in electronic trading on the New York Mercantile Exchange by late afternoon in Singapore.

The contract fell 87 cents to settle at $88.60 a barrel Friday, after rising as high as $90.07 in earlier electronic trade. December Nymex crude declined 75 cents to $87.85 a barrel.

Still, many analysts expect the declines to be temporary and believe oil futures will continue an assault on price records in the days ahead. They say prices are being driven by a weak dollar, speculative investing and low supplies at a key oil terminal in the U.S. Midwest.

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

[ozymandius]

4. Wall Street hopes for upbeat earnings

NEW YORK - Lukewarm third-quarter earnings reports to date imply that corporate America has some thorny problems. For the stock market to get back on track, this week's releases will have to offer Wall Street some more upbeat news.

Last week's batch of earnings reports, along with some downgrades from Standard & Poor's on mortgage-backed securities, indicated credit tightness lasted well after summer ended. That suggests the fourth-quarter comeback Wall Street bet on when it hit record highs earlier this month may not happen.

It wasn't only banks and housing-related companies that revealed troubles last week. Big Dow components including 3M Co., Honeywell Inc., and Caterpillar Inc. posted third-quarter profit rises, but their outlooks were much dimmer than anticipated.

-cut-

This week, given Citigroup Inc.'s 57 percent drop in profit and Bank of America Corp.'s 32 percent decline, investors are going to be interested in how brokerage Merrill Lynch fared during the recent credit squeeze, which peaked in August.

http://news.yahoo.com/s/ap/20071021/ap_on_bi_ge/wall_street_week_ahead

[ozymandius]

5. Halliburton's 3Q earnings up 19 percent

HOUSTON - Halliburton Co. continues to benefit from placing greater emphasis on its operations in the Eastern Hemisphere, where expanding business helped the company post a 19 percent rise in third-quarter earnings.

The Houston-based oilfield services company said Sunday its net income rose to $727 million, or 79 cents a share, in the July-September period from $611 million, or 58 cents a share, in the year-ago period.

The most-recent results included a favorable income tax benefit of $133 million, or 15 cents a share.

Third-quarter revenue rose 16 percent to $3.93 billion.

Excluding the income tax gain, the results matched analysts' average earnings estimate of 64 cents on revenue of $3.87 billion, according to Thomson Financial.

http://news.yahoo.com/s/ap/20071021/ap_on_bi_ge/earns_halliburton

[Roland99]

15. Merck & Company 3rd Quarter Net Climbs 62% To $1.53B

http://www.marketwatch.com/news/story/merck--company-3rd-quarter/story.aspx?guid=%7B38F83B57%2DEC59%2D4F24%2D8518%2D2C6F6A689181%7D&dist=hplatest

[TalkingDog]

21. I still don't think they've grasped the magnitude of the ripple effect

from the sub-prime problem.

Their first clue was the actual crisis.
Their second clue should have been the dismal furniture market.
Caterpillar's reportage gave them a tweak, but frankly, they've still got their heads (we'll put it kindly) in the sand.

The Spousal Unit is an architectural designer (not houses, thank goodness) and people think that just means drawing a building, but here is how he explains it:

"Imagine you are going to build a house and and you have to make a list of everything that needs to be done from digging the footers to painting the walls. But it has to be complete and it has to be in the order in which it must occur."

There is a lot of commerce that goes on above and beyond the labor to build, the materials to build it with and the furniture. Moving into a new house often means a whole new decor, new sheets, new chotskis, new kitchen cabinets, wallpaper, paint, sometimes a lawn-mower, sometimes a lawn service, wells being dug, surveyors, title exchanges, permits and their costing, local taxes, contractors, sometimes an architect.

I've never moved into a brand new house, but, even then, when I'm packing I throw out the old and make a list of the new things to get when I'm settled.

And that is just on the housing starts. The folks who are going to lose their homes due to ARMs are a whole 'nother set of variables to consider.

Regan had "Trickle Down Economics". This administration is giving us "Backwash Economics".


My Favorite Master Artist: Karen Parker GhostWoman Studios

[kineneb]

60. a new house experience

We have had that, ahem, dubious joy. It is a major pain, especially if one starts from the ground up. Even buying a new manufactured house (ok- fancy double-wide), it took 6 months. I could not imagine the "joys" of having a stick-build home built.

The process...

rent place locally while selling old home
find property
negotiate purchase
buy property (had cash from previous sale)
pick out floor plan, etc. & order house from Mfg. house retailer
get contractor to put in foundation/water/power/propane hook-up
wait for house to be built
wait for house to be moved from factory
get installers to assemble house
have contractor replace the propane tank hookup after someone drove over it...
get installers to finish inside of house
order laminate flooring, find installers
paint interior walls to personal desired colors (me)
choose propane company and get tank installed
get PG&E to turn on the @#$%&* electricity
...and finally... get friends to help us move in
AAAAAGGGGGHHHHHH!
(Fortunately, much of the "leg" work was done by a very nice lady at the Mfg. home retailer- she knew all the right people to call at the right time. She earned her commission.)

And with each step, there are lots of people, not to mention money and paperwork involved. What happens when nothing is getting built/sold?

-real estate agent has no sale
-county employees have nothing to do
-sales people at Mfg. home office have no sales
-workers at Mfg. factory have no work
-suppliers to Mfg. factory have no work
-rig drivers have nothing to move to factory
-contractor and employees have no work
-house installers have no work
-laminate flooring doesn't get sold
-hardware store does not sell paint and supplies (they now know me almost by name, certainly by sight)
-propane company doesn't get new customer
-power company doesn't get a new customer
-Ikea doesn't get lots of my money for furniture and new bookcases

And all the people involved don't get paid.

It truly is a trickle-down effect.

[TalkingDog]

64. According to the Spousal Unit, Mfg. homes have some major advantages

over site built.

Mold being the major one. Mfg. homes are built indoors, no chance of a nice long rain soaking your framing and underlayment and later catching the dreaded Black Mold. (Although right now, there would be little chance of that happening here in NC)

Better and more consistent grades of lumber. Since they buy in bulk and are regular customers, they can buy choice straight wood and engineered parts at less costs than a small contractor.

Consistent laborers (ummm...to put it nicely, a factory can afford to pay more, with benefits and keep out the no show substance abusers...and yes, there are many tradesmen who do not drink/drug and show up consistently, but having heard a LOT about job sites, I can tell you questionable labor can be an issue)

So, call it a fancy double wide, but it will last as long, if not longer than many site framed homes.

You've clarified the point very nicely regarding the branching out of the effect.

I was talking to the Spousal Unit about housing and the economy and since my fears are always of a sudden and catastrophic sort, he gave me another way to think about it:

IceBreakers. Those ships that break through the ice. At first the ice is so flimsy and the ship has such mass and momentum that it has no problem keeping speed. But as the ice piles up thicker and thicker the ship starts losing momentum, which means it the mass of it is no longer sufficient to break the ice as efficiently, so it slows even more and it becomes a cycle of slowing momentum and increasingly thicker ice. Soon even the mass of the ship becomes a hindrance because it is no longer propelled by forward momentum.

Soon, it just stops. Dead in the ice.

At that point, I think the polar bears eat us.


My Favorite Master Artist: Karen Parker GhostWoman Studios

[ozymandius]

6. Business conditions deteriorate, outlook dims, NABE

NEW YORK (Reuters) - Business activity, capital spending and hiring slowed in the third quarter in response to tightening credit conditions and a rapidly deteriorating housing market, an industry survey showed on Monday.

But the majority of respondents to a National Association of Business Economists October survey said that tightening credit conditions have not affected their business, while just over a third reported negative impacts.

The finance and goods-producing sectors had the largest percentage of respondents indicating a negative impact from tighter credit conditions.

The housing market outlook turned from bad to worse, with 98 percent of respondents expecting a further slowdown in housing activity and 54 percent expecting the slowdown to be substantial.

Respondents were split as to whether a slowdown would have an impact on their business.

http://news.yahoo.com/s/nm/20071022/bs_nm/economy_nabe_dc

[ozymandius]

7. GDP EXPECTED TO BE BELOW 2 PERCENT

-from above article-

Less than half of NABE panelists said they expect inflation-adjusted gross domestic product, or real GDP, to grow at an annual rate above 2 percent in the second half of 2007.

Fifty-three percent of respondents expected GDP growth to be below 2 percent, a more pessimistic view than participants had expressed in the last survey regarding the second half of the year.

[JNelson6563]

23. That is mighty bad.

I will try to catch some CNBC later so Steve Liesman can explain to me why this bad news is actually good and that I should be thankful for the increase in my chocolate rations.

Oy.

Julie

[Roland99]

24. Well, it means inflation will be under control due to a non-overheated economy.

;)

[AnneD]

40. Roland...

:spray::rofl:

And we'll all lose weight on the new Bush See Food Diet-we'll see food but won't be able to afford to buy it.

Badda Bing.

[Roland99]

51. It's the new low-CARB diet

Cash Assets: Rare Breed.

[ozymandius]

8. Asian stock markets tumble as nervous investors scale back risk UPDATE

SINGAPORE, Oct. 22, 2007 (Thomson Financial delivered by Newstex) -- Asian stock markets tumbled Monday with the benchmark South Korean index losing almost 5 percent at its worst level after Wall Street's steep decline Friday prompted investors across the region to scale back risky positions.

Reflecting the risk-averse mood, the yen spiked higher against the dollar as traders moved to unwind carry trade positions, in which they borrow in a low-yielding currency to invest in higher-yielding currencies and assets.

Investors are nervous about a possible repeat of Black Monday, the market crash of Oct 19, 1987 which had its 20th anniversary on Friday.

-cut-

Emerging risk

International bankers said Sunday that emerging markets, including the economies of Southeast Asia, could become the next bubble.

Investors are expected to pour a record 620 billion dollars into emerging markets in 2007, according to the Institute of International Finance in a report released on Sunday. Money is flowing into emerging markets as investors shift away from instruments with exposure to the US subprime sector.

http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-20390994.htm

[ozymandius]

9. Bleak Monday for stocks

NEW YORK (CNNMoney.com) -- U.S. stocks appeared poised to follow global markets lower Monday as the dollar continued its recent slide and investors worldwide remained jittery following last week's brutal sell off on Wall Street.

Stocks in Asia tumbled and European markets opened sharply lower, after the dollar hit yet another record low against the euro and continued its slide versus the yen.

Late Friday the G7, the finance ministers from the world's seven largest economies, concluded their meeting in Washington without expressing any concern over a strengthening euro or weakening dollar.

That was seen as giving the green light for further selling of the American currency. That slide in the dollar in turn hit the shares of many European and Asian exporters, whose goods are now more expensive in the key U.S. market, while also working to make the dollar-denominated shares of major U.S. companies less attractive to overseas investors.

http://money.cnn.com/2007/10/22/markets/stockswatch/index.htm?postversion=2007102206

[ozymandius]

10. futures numbers

06:24 am : S&P futures vs fair value: -13.5. Nasdaq futures vs fair value: -14.3.

[Roland99]

13. Dow futures -115 at 7:45am

http://www.marketwatch.com/News/Story/Story.aspx?column=Indications

S&P 500 futures dropped 11.1 points at 1,494.70 and Nasdaq 100 futures were down 16 points at 2,133.75. Dow industrial futures fell 115 points.

On Friday, U.S. stocks dropped sharply on the 20th anniversary of Black Monday, in reaction to disappointing results and earnings outlooks from blue chips Honeywell International, 3M Co. and Caterpillar Inc. The Dow Jones Industrial Average tumbled 366 points, the S&P 500 lost 39 points and the Nasdaq Composite dropped 74 points.

But, hey, Merck and Cheneyburton are doing great!

[Roland99]

20. Oh, and I noticed wholesale gas was down this morning...about $2.14/gal or so

I filled up last night at $2.66/gal.


weirdness.

[TalkingDog]

22. In NC it's going up. 2.80 retail. They're looking for it to increase again this week. n/t

My Favorite Master Artist: Karen Parker GhostWoman Studios

[feminazi]

67. I paid $3.06 in San Jose on Saturday

I swear it was about $2.90 when I filled up the week before.

[Roland99]

25. Worsening still...

9:03am

Dow -131.00 -0.97% 13,429.00
NASDAQ -12.50 -0.58% 2,137.25
S&P -9.00 -0.60% 1,496.80

[ozymandius]

11. Good morning.

:donut: :donut: :donut:

Time for me to get out the door. Looks like anyone following the markets today would be well advised to hold onto something sturdy.

:hi:

[Buttercup McToots]

12. Today is going to be a mess...

If your riding the bull...strap yourself on...
It's already bloody...:nuke:

[Roland99]

14. Just another Manic Monday

Six o'clock already
I was just in the middle of a dream
I was kissin' Valentino
By a crystal blue Italian stream
But I can't be late
'Cause then I guess I just won't get paid
These are the days
When you wish your bed was already made

It's just another manic Monday
I wish it was Sunday
'Cause that's my funday
My I don't have to runday
It's just another manic Monday

Have to catch an early train
Got to be to work by nine
And if I had an air-o-plane
I still couldn't make it on time
'Cause it takes me so long
Just to figure out what I'm gonna wear
Blame it on the train
But the boss is already there

All of the nights
Why did my lover have to pick last night
To get down
Doesn't it matter
That I have to feed the both of us
Employment's down
He tells me in his bedroom voice
C'mon honey, let's go make some noise
Time it goes so fast
When you're having fun

[AnneD]

41. Perfect theme....

:thumbsup: I might be into a little-'Eve of Destruction' myself, but the bubble gum is ok.

[Buttercup McToots]

16. Powers Vow in 2007 as in 1932

Powers Vow in 2007 as in 1932

--------------------------------------------------------------------------------


Powers Vow to Limit Credit Crisis Damage
October 19, 2007 (Jeannine Aversa - AP Economics Writer)

World's Top Finance Officials Pledge to Limit Economic Fallout From Credit Crisis

Finance officials from the world's top economic powers pledged Friday to do all they can to limit damage to the global economy from a jarring credit crisis as Wall Street took another plunge.

"We remained committed to doing our part in sustaining strong global growth," the finance officials said in a joint statement. While saying the functioning of global financial markets was improving somewhat, they warned that "uneven conditions are likely to persist for some time and will require close monitoring."

"Powers" vow to fix the economy? My but that sounds ominous, in a black and white movie reel from the 1930s kind of way.

We were led to believe that the markets had all the power. Who are these powers who are going to fix the economy? Certainly not the same ones who broke it, we hope. Reminds us this tidbit from our 1999 research for Ka-Poom Theory.
"Reflation"
Apr. 25, 1932 (Time)
Plans for a third enormous national credit pump lay last week before the House Banking & Currency Committee. In January this committee helped design Reconstruction Finance Corp. to pump $2,000,000,000 of Federal funds through the nation's banks into Industry. In February, with the Glass-Steagall bill, it went to the rescue of the banks themselves by giving them a bigger & better pipe line into the Federal Reserve System. It was now proposed to pump Federal Reserve credit into the commodity markets— wheat, corn, beef, cotton, coffee, sugar. The bill was introduced by Representative Thomas Alan Goldsborough, Maryland Democrat. It required the Federal Reserve "to take all available steps to raise the present deflated wholesale level of commodity prices as speedily as possible to the level existing before the present deflation, and afterward to use all available means to maintain such wholesale commodity level of prices." Just how the Federal Reserve was to accomplish this large order nobody was sure.
George Leslie Harrison, governor of the Federal Reserve Bank of New York and Eugene Meyer, governor of the Federal Reserve Board, appeared before the Committee. Both opposed the Goldsborough bill. Their objections were similar: the Federal Reserve was now doing all it could to support the commodity markets; by itself it could not execute such a legislative mandate. Declared plump Governor Meyer: "I would not want to be peremptorily ordered to run 100 yards in ten seconds flat." The Federal Reserve, according to its chief, was now "holding the line" and "if you can hold the line, you can turn it eventually."
To specify what the Government had already done Mr. Meyer revealed that R. F. C. has helped out of trouble 1,319 banks of which 76% were in towns of 10,000 population or less.* Likewise since Feb. 1, $250,000,000 in currency had been returned to circulation by hoarders.†
But it remained for pipe-smoking Governor Harrison to lay the biggest piece of fiscal news down before the House Committee—namely, that the Federal Reserve was in the market for U. S. securities as never before. Its purchases were part of the Government's new determination to pump credit into the country—a process its friends call "reflation" instead of inflation—under the provisions of the Glass-Steagall bill. Not until its statement was issued later in the week was the full extent of the Federal Reserve's pumpings evident to the country.
The Glass-Steagall bill permits Federal Reserve banks to use Treasury obligations for part of their currency coverage, thereby releasing gold above the 40% minimum requirement. Open market operations in the U. S. securities have always been part of the Federal Reserve's function. Last autumn the Federal Reserve began a credit-pressure move of the kind now undertaken. England's gold crisis halted that move, but since the Glass-Steagall bill's enactment (Feb. 27), the Reserve has been quietly purchasing in the open market Federal securities at the rate of $25,000,000 per week. Last week it was buying them at the rate of $100,000,000 per week. Total purchases: $245,000,000. The U. S. security market fairly boomed, imparting strength down the line to the rest of the bond market.
The result of this new Government credit policy was to increase the funds at the disposal of Reserve member banks for commercial loans in the following manner: Bank A receives from a customer $500,000 in Government securities to sell. It turns them into the Federal Reserve bank which credits Bank A with $500,000. Bank A credits its customer with a $500,000 deposit on which it must pay interest. But it gets no interest on its own $500,000 Reserve deposit. Until it draws its Reserve deposit and puts it to profitable work at the service of commerce or industry, it is losing money.
Last week, as a result of open-market purchases by the Reserve banks, the system's member bank balance increased $69,000,000 to $2,011,000,000. In effect the Federal Reserve was stacking this pile of $69,000,000 (worth approximately $690,000,000 in new credit) in its front window and inviting member banks to come and get it for "reflationary"' purposes rather than to call loans to raise money.
*Last week the Treasury gave R. F. C. the last $150,000,000 of its $500,000,000 allotment. Hereafter to raise money R. F. C. will have to sell its own securities.
† Last week, after subscriptions of $30,000,000 the Treasury ceased selling "baby bonds" to absorb hoarded funds.
In the 1930s they had no idea how bad things were going to get if they waited too long to react to the post-credit bubble debt deflation. Plus the Fed, by even a casual reading of the minutes, was clearly composed of a pack of perfect dimwits.

No such errors this time, but new ones. The key lesson the Fed learned: don't wait until the money supply has imploded and the banking system is crippled before acting. But no two circumstances are alike, and in the fullness of time the current FOMC will likely be seen as just as dimwitted but in a way unique to our times, such is the folly of trying to be a "power" over the markets.

Another lesson learned: a sure fire way to keep us all from "hoarding funds" is to take away the funds–in those days gold–as FDR did in 1933 by executive order, and raise the price by 30%. Presto, 30% monetary inflation. Oops, I mean "reflation," a more polite word invented at the time, and the one we chose to use in our Ka-Poom Theory of post-bubble disinflation/reflation cycles. Today, without gold backing, the Fed is free to simply print more fiat money to create inflation, I mean, reflation. The resulting mass behavior modification is to cause us all at once to think of hoarding old newspapers before government money. Better spend it while we can. So while the jobless claims numbers surprise four out of five economists on the upside by a factor of four, and living paycheck to paycheck is getting nearly impossible, the malls are jammed with shoppers eager to spend their paychecks before they're sent to reflation heaven by the latest round of bonar depreciation.

Our crusty old 2001 recession forecast is looking more every day like it should have been made for the approaching recession. In it we said:
"The fiscal 'surplus' of the past few years will turn out to be due primarily to capital gains tax receipts. As tax payers take capital gains losses against gains in 2001, tax receipts will fall by a greater extent than expected. Tax cuts, blessed by Greenspan last week and enacted to help the economy will create an enormous fiscal deficit for 2001."
Our 2001 recession forecast was about half right. The good news: the important half was correct: "The first stage of the depression is deflationary, the second inflationary."

Those of us who invested in gold and other inflation hedges in 2001 did better than those who listened to the deflationists, legion at the time, and made deflation bets. That holds true today.

Next week, we review our now year old forecast of a post housing bubble recession starting in Q4 2007. We've learned a thing or two since 2000 and expect this forecast to be better than half right. Evidence is that this will be, without a doubt, the most peculiar recession ever, with some sectors of the economy booming while others are crashing, some geographic areas of the US contracting while others are still growing. On a whole, we figure the Alternative Energy and Infrastructure bubbles need to get cranked up and boosting demand in 18 to 24 months to keep the US from running into Japan 1990s style debt deflation cycle.

See also:
Bubbles in Everything... Sort of (subscription) Janszen - 10/19/07
Why oil and gold price increases are not bubbles but rather reflect monetary inflation.

The End of the Debt and Delusion (subscription) Janszen - 10/17/07
This is one of those pieces that EJ occasionally writes to help align readers' thinking more in line with long term historical processes versus consumed by the short term market news discussion in the mainstream business press that is designed to keep investors trading and generating fees for brokers and readership for their financial market publications, web sites, and blogs.

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[Roland99]

19. "reflation"?

:eyes:

[AnneD]

43. Yeah....

that's when the economy doesn't suck anymore-it just blows;)

[Roland99]

52. Bwa Ha Ha Ha Ha Ha

:rofl:

[UpInArms]

17. dollar watch

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

Last trade 77.884 Change +0.543 (+0.70%)

Post G7 - Where Do We Go From Here?

http://www.dailyfx.com/story/topheadline/G7___Where_Do_We_1193028854191.html

The G7 meeting ended not with bang but whimper as members made no overt references to the dollar, the euro, or the yen only singling out the Chinese yuan as the currency most in need of adjustment. The focus on the yuan created a knee jerk selling reaction in the USDJPY on the open of trading in Australia with the pair gapping 50 points to slip below the 114.00 figure. However, it remains to be seen if the yen will continue to rise as carry traders may find the new lower levels of the yen crosses too tempting to pass up.

Although the yen typically strengthens by an average of 500 points after G-7 meetings, much of the fall in USDJPY occurred pre-meeting as traders positioned themselves for a more hawkish communique.The pair is already down more than 1000 points from its 2007 highs and now stands only 250 points away from the spike lows set during the August credit crunch. Given the lack of pressure on the Japanese officials to speed up the normalization of interest policy, yen's strength going forward will have to rely primarily on risk aversion. To that end the Nikkei and later the Dow could be the dominant forces in currency trading today. With DJIA down more than 300 points on Friday, FX traders will anxiously await Monday's open. If stocks don't find a bottom USDJPY is unlikely to find one too.

For the greenback itself, the situation looks rather gloomy as the week begins. The absence of any clear indication of support from the G-7 suggests that monetary officials will not intervene either verbally or physically to stem the dollar's decline. This leaves the greenback at the mercy of the speculators who will likely push it even lower especially if they become convinced that the Fed will be forced to lower rates another 25bp in October. With Fed funds futures handicapping a 92% probability of a cut the greenback looks vulnerable as 1.4400 in EURUSD 1.4400 and 2.0600 in GBPUSD may be put to the test in the next few days.

...more...

US Dollar: 90% Chance for October Rate Cut!

http://www.dailyfx.com/story/bio1/US_Dollar__90__Chance_for_1192826929258.html

The price action in the financial markets this week is a testament to how quickly expectations and sentiment can change. We started the week with nearly everyone in the market agreeing that the Federal Reserve will not cut interest rates at the end of the month and now implied Fed Fund futures are pricing in a 90 percent chance of an October cut. Taking a step back, aside from US consumer prices, the data released this week the US was mostly second tier, which means that they should not have been all that market moving. So what caused the dramatic change in interest rate expectations? Continued weakness in the housing market, disappointing earnings in the banking sector and a 550 point drop in the Dow (Monday to Friday). With HSBC downgraded, Bank of America reporting a 32 percent decline in earnings and Wachovia reporting a 10 percent drop, the 20th Anniversary Week of Black Monday 1987 has proven to be as brutal on a point basis as many of the October crashes that we have seen in the past. The rise in oil prices creates additional risk for an already vulnerable US economy and calls for a recession are returning. More immediately however, we need to turn our focus to today’s G7 meeting. The communiqué should be released this evening. According to Dow Jones, the draft of the statement indicates that finance ministers will be calling for the Chinese Yuan to increase more quickly in value. The Euro, US dollar, Japanese Yen and the Dow will probably not be mentioned in the official statement. The biggest currency to be impacted will therefore be the Japanese Yen. Next week, we have more housing market data from the US as well as durable goods due for release. The market’s primary focus will be on the following Wednesday’s October 31st FOMC meeting but don’t write off the potential for a continuation move in the equity and currency market if there are any additional surprises in the official G7 communiqué.

...more...

[UpInArms]

18. Dollar hits new record low against euro (yentervention, anyone?)

who's propping the dollar?

http://news.yahoo.com/s/afp/20071022/bs_afp/forexeurope

1 hour, 19 minutes ago

LONDON (AFP) - The dollar struck a record low against the euro and suffered fresh losses against the yen Monday on concerns about the US economy, which also sparked another rout on global stock markets.

In Asian trade, the euro jumped to a record 1.4347 dollars, which was the highest level since the single currency's creation in 1999. It later stood at 1.4307 dollars in European trade.

Elsewhere, the yen reached a three-week high against the euro and six-week pinnacle versus the dollar.

The euro shot higher after top world finance chiefs refrained from voicing increased concern about currencies at their meeting on Friday, which dealers took as a reason to drive the dollar down to fresh lows.

"The G7 in effect gave a green light to further weakness in the US dollar by not referring to the currency in their communique," said Geoffrey Yu, currency analyst at UBS.

...more...

[ret5hd]

26. Hey Goldbugs: From Kitco.com (first time i've seen this happen)...

From kitco.com:

IMPORTANT: Due to technical difficulties our data provider is experiencing, our pricing may not be accurate. We will not be able to honor any orders at this time. We anticipate a resolution shortly. We apologize for the inconvenience and appreciate your patience.

[AnneD]

27. Morning Marketeers....

:donut: and lurkers. We had a most interesting weekend at our house. Seems hubby was coming off the night shift and had picked up his uniforms from the cleaners. He was turning to make it home when a driver ran a red light and hit him on the front drivers side. It totaled his car. There was a witness but he didn't want to be late for work but he gave hubby his phone number. The police didn't issue a ticket to the lady because it happened at the intersection-but thank goodness we have a witness.

Hubby was checked out by the paramedics and released. I have noticed some unusual swelling and I told him to go to the Doc because I think he has a hairline fracture of his left arm. We only have liability and there is medical attached. We spoke to our ins. co. and they don't seem to be to willing to help us get damages. We haven't talked to the lady's ins co yet although they were the first to call (hubby works graveyard and I didn't want him doing anything until he had a good sleep and he get throughly checked out).

Needless to say I have been a chauffeur all weekend and am totally exhausted. It took me all Sunday to do 2 things I needed to do (pick up my meds and do the laundry) for all the chauffeuring I did. I finished at 9pm and I was physically and mentally drained. We are trying to coordinate with one vehicle now-what a mess. You can do it but to suddenly have to do it is a shock.

I have the feeling that this is a continuing saga. We just want the medical paid and our car replaced (car is 2K and we don't know about the medical yet). It should be very reasonable and we are not in to make a buck or anything. If the ins co starts acting like assholes though-it may become another story. At least we have a witness (I hope). Just that fact ought to make it easier for us in our negotiations.

I am hoping for a calmer day at the market- I had enough excitement this weekend.

Happy hunting and watch out for the bears.

[Roland99]

29. Ah, in those situations I *always* contact the other party's ins. co. first.

Tell them you'll retain an attorney if they do not respond quickly to repairing your car and covering medical bills.

Hope all works out well for your husband and the whole ordeal passes quickly!

:hug:

[UpInArms]

36. sorry to hear about

hubby's accident - hope all will be alright - and hopefully the insurance companies will make you whole on the costs and auto replacement

:hug:

[Hugin]

55. Morning AnneD...

:hangover:

Sorry to hear of your travails. :(

[Roland99]

68. Sorta sad news on my end now...

Just dropped my cat off at the vet. She's not eaten for a few days (and nothing coming out the other end either). Not sure if it's a bad tooth or something worse. Waiting to hear back from the vet. :(

[AnneD]

69. Cats are such difficult patients....

not because they are difficult per se, but it can take a while for you to know that something is wrong with them. They'll come up and rub your leg and you'll never know they have a UTI. Remember-nothing in/nothing out is to be expected. Let's hope for good things:hug:

FYI, Hubby does have a broken arm. Hairline in the ulna (as I suspected). Bad luck for a sitar player. He's going to an orthopedist to get it casted. Guess I'll have to baby him for a while-but he should feel better once it is casted. Our Chiropractor is a god send and a personal friend. He is familiar with the ins and outs of these things and has a boatload of good contacts-so we are confident that things will work out for us.

[Roland99]

70. Not good news. Looks like kidney failure.

There are two enzymes they test for. Both are WAY off the chart.

Still, going to try a couple days of IV fluids and see if the enzyme level improves.

If not.


......



:(

[AnneD]

72. Kidneys can recover.........

prayers for a recovery:grouphug:

[UpInArms]

28. Rupert Murdoch sketches financial media assault (another assault on truth)

http://www.reuters.com/article/businessNews/idUSN1941909920071019?feedType=RSS&feedName=businessNews&sp=true

NEW YORK (Reuters) - Rupert Murdoch sketched out his plans for the Fox Business Network on Friday, saying he will spend years nurturing the new channel to win over more than half of the business news audience.

The News Corp (NWSa.N: Quote, Profile, Research) chairman and chief executive confirmed media reports that his media conglomerate intended to invest $150 million to $200 million over three years in FBN, including about $70 million in fiscal 2008.

Aiming to repeat the success of the Fox News Channel, which unseated CNN as the top cable news network four years after its launch, FBN is part of Murdoch's ambitions to build a global financial media powerhouse in print, the Internet and TV.

"I view FBN's growth in terms of years, not months," he told reporters following News Corp's annual shareholders meeting.

The 76-year-old mogul said he aimed to chip away at the competition -- the market leader for cable business news is CNBC -- while forging a broader audience beyond day traders and finance professionals.

"We'd like to take some of their viewers," he told reporters, referring to CNBC. "Our objective is to have more than half of it," he said, referring to business news viewers.

While some critics question whether there was room for a third cable business news channel after CNBC and Bloomberg TV, Murdoch pointed out that his investments pay off.

He said the company's $900 million investment in the Fox News Channel is expected to earn at least as much annually. Its value, he said, is to exceed $10 billion.

...more...

[Roland99]

31. FBN, eh? Faith-Based News?

:rofl:

[AnneD]

45. FBN....

Funny Business News. I have watched it. I'm underwhelmed. Heavy on human interest, short on facts.

[eyeontheprize]

38. There is a problem with Murdoch's

plan. When he launched Faux, CNN reported real news. The reality based kind. CNN has since abandoned that practice to compete with Faux, or maybe it is just another corporate sell-out, who knows? Either way, initially Faux set out to capture the market of people who didn't like truth in their news, and they found all of those viewers. A real innovator in Cable News today would present fact based reporting and not balance truth with lie as if they deserved equal weight.

Back to CNBC, it is already a fictionalized, propagandistic take on the financial sector. It is aimed at an audience of true believers, and/or wanta be Wall Street moguls. This time around Murdoch would have to tell the truth if he wanted to capture a group looking for something new. It would be an interesting twist, but it's doubtful that he'd have any idea of how to start such an operation.

[TalkingDog]

59. Maybe he could just buy up all the old episodes

of "Lifestyles of the Rich and Famous" and "Fantasy Island" and run them constantly.

Besides, Morlock (oops, I meant) Murdoch is a business man. In Europe all of his media outlets regularly bash Bush. It's what his audience wants. So he gives it to them.

He'll find some way to do the same here.


My Favorite Master Artist: Karen Parker GhostWoman Studios

[UpInArms]

30. Fed Bailout: Barclays, RBS line up Fed for $30 bln credit: report

http://news.yahoo.com/s/nm/20071021/bs_nm/barclays_rbs_fund_dc

LONDON (Reuters) - Barclays (BARC.L) and Royal Bank of Scotland (RBS.L) have lined up emergency funds of up to $30 billion from the U.S. Federal Reserve to bail out American clients caught up in the global credit crunch, a paper said.

Barclays has been given permission to borrow up to $20 billion through the facility, while RBS can borrow up to $10 billion, the Sunday Telegraph quoted banking sources as saying.

The banks would have to put up assets as collateral with the Fed to gain access to the credit line, which has been set up as a contingency and may not need to be used at all, the report said.

It is similar to those offered to Citigroup (C.N), Bank of America (BAC.N), JPMorgan Chase (JPM.N) and Deutsche Bank (DBKGn.DE) at the height of the credit crunch, it said.

...a bit more...

[UpInArms]

32. Living paycheck to paycheck gets harder

http://news.yahoo.com/s/ap/20071019/ap_on_bi_ge/stretching_paychecks?_ylt=Asqj.j5x7PX9Zku.Xh5HtPKb.HQA

NEW YORK - The calculus of living paycheck to paycheck in America is getting harder. What used to last four days might last half that long now. Pay the gas bill, but skip breakfast. Eat less for lunch so the kids can have a healthy dinner.

Across the nation, Americans are increasingly unable to stretch their dollars to the next payday as they juggle higher rent, food and energy bills. It's starting to affect middle-income working families as well as the poor, and has reached the point of affecting day-to-day calculations of merchants like Wal-Mart Stores Inc., 7-Eleven Inc. and Family Dollar Stores Inc.

Food pantries, which distribute foodstuffs to the needy, are reporting severe shortages and reduced government funding at the very time that they are seeing a surge of new people seeking their help.

While economists debate whether the country is headed for a recession, some say the financial stress is already the worst since the last downturn at the start of this decade.

From Family Dollar to Wal-Mart, merchants have adjusted their product mix and pricing accordingly. Sales data show a marked and more prolonged drop in spending in the days before shoppers get their paychecks, when they buy only the barest essentials before splurging around payday.

"It's pretty pronounced," said Kiley Rawlins, a spokeswoman at Family Dollar. "It seems like to us, customers are running out of food products, paper towels sooner in the month."

...more...

(fixed link on edit)

[UpInArms]

35. It's sure a good thing that there is NO inflation!

:sarcasm:

more from the article:

Gas prices hit a record nationwide average of $3.23 per gallon in late May before receding a little, though prices are expected to soar again later this year. Food costs have increased 4.5 percent over the past 12 months, partly because of higher fuel costs. Egg prices were 44 percent higher, while milk was up 21.3 percent over the past 12 months to nearly $4 a gallon, according to the Bureau of Labor Statistics.

The average family of four is spending anywhere from $7 to $10 extra a week — $40 more a month — on groceries alone, compared to a year ago, according to retail consultant Burt Flickinger III.

And while overall wage growth is a solid 4.1 percent over the past 12 months, economists say the increases are mostly for the top earners.

[kineneb]

61. and for those on SS or SSDI ...

the cost of living adjustment is ...how much?

(not nearly enough, please pass the beans...)

[Hugin]

63. It's interesting those at the top are considered, 'earners'...

While those on SS and other programs are called by phrases which all imply some form of welfare... Even though
SS _IS_NOT_A_WELFARE_PROGRAM_.

:eyes:

[Roland99]

33. 9:33am - And they're off (and stumbling badly)

Dow 13,430.41 -91.61
Nasdaq 2,698.14 -27.02
S&P 500 1,490.80 -9.83
10 YR 4.39% -0.01
Oil $88.60 $-0.87
Gold $755.50 $-12.90


Oucho on the gold.

[Roland99]

34. 5 min. in and Dow down 103.80

[UpInArms]

37. 9:39 EST - just a flesh wound

Dow 13,440.90 81.12 (0.60%)
Nasdaq 2,708.52 16.64 (0.61%)
S&P 500 1,493.11 7.52 (0.50%)
10-Yr Bond 4.389% 0.012

NYSE Volume 124,391,734.375
Nasdaq Volume 122,475,414.062

[Roland99]

39. 9:45am - Looks like we're heading for a full recovery

Dow 13,474.96 -47.06
Nasdaq 2,721.69 -3.47
S&P 500 1,495.25 -5.38
10 YR 4.41% 0.01
Oil $88.60 $-0.87

[UpInArms]

42. 9:53 EST and barely a scratch now

Dow 13,485.20 36.82 (0.27%)
Nasdaq 2,726.88 1.72 (0.06%)
S&P 500 1,495.57 5.06 (0.34%)
10-Yr Bond 4.389% 0.012

NYSE Volume 221,452,406.25
Nasdaq Volume 210,413,578.125

[Hugin]

56. It's the pumping...

Looks like there's a pattern forming here of tolerating a slide on Fridays, but, no way on Monday.

PPT?

[UpInArms]

44. Fed Pumping Action: Fed adds $10.5 bln in temporary reserves via overnight repo

http://www.reuters.com/article/bondsNews/idUSNYG00079620071022

NEW YORK, Oct 22 (Reuters) - The U.S. Federal Reserve said on Monday it added $10.5 billion of temporary reserves to the banking system through an overnight repurchase agreement.

Federal funds were trading at 4.75 percent in the market after the amount of the operation was announced, matching the 4.75 percent target rate the Fed sets.

The Fed said collateral accepted in the operation was $8.335 billion in agency debt, $1.247 billion in mortgage-backed securities and $918 million in Treasuries.

A total of $67.9 billion in bids were submitted for the operation.

[DemReadingDU]

47. Does the Fed have a daily limit for the amount to pump?

I guess the Fed can always print more money, but is there a limit to the amount per day?

[DemReadingDU]

46. Mike Whitney: California falls into the sea

10/20/07 Housing Flameout: California falls into the sea By Mike Whitney

Is it really fair to blame one man for destroying the US economy?

Probably not. But Alan Greenspan is still tops on our list. After all, Greenspan “presided over the greatest expansion of speculative finance in history, including a trillion-dollar hedge fund industry, bloated Wall Street-firm balance sheets approaching $2 trillion, and a global derivatives market with notional values surpassing an unfathomable $220 trillion.” (Henry Liu, “Why the Subprime Bust will Spread” Asia Times) Greenspan’s also responsible for slashing the real Fed Funds Rate so that it was negative for 31 months from 2002 to 2005. That decision flooded the housing market with trillions of dollars in low interest credit creating the largest equity bubble in history. Now that that bubble is crashing; Greenspan has hit the road. He now spends his time leap-frogging from city to city hawking his revisionist memoirs of how he steered the ship of state through troubled waters while fending off protectionist liberals. Look for it in the Fiction section of your local bookstore.

CALIFORNIA HOUSING FALLS OFF A CLIFF

We are now beginning to see the first signs that the listless housing bubble has sprung a leak and is careening towards earth. This week’s news from Southern California confirms that home sales have plummeted a whopping 48.5% from the previous year. This represents the biggest decline in home sales since the industry began keeping records more than 20 years ago. Sales are at a standstill and builders and homeowners have begun slashing prices in desperation.

DEFLATIONARY DOWNWARD SPIRAL

There is a debate raging on the econo-blogs about whether the country is headed towards hyperinflation or a deflationary cycle. The argument for hyperinflation is compelling since the Fed has already shown that it is prepared to savage the dollar in order to keep the economy running. As a result, we’ve seen inflation is heating up at a pace not seen in over a decade.(despite the government’s mendacious figures) In September gasoline costs rose 4%, heating oil soared 9%, food jumped 5%, and dairy products lurched ahead 7.5%. Everything is up except the greenback which appears to be in its death throes.

much more...
http://www.informationclearinghouse.info/article18595.htm

[Roland99]

48. Tax Evasion: The great lie of supply-side economics.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x2106664

[DemReadingDU]

49. Fleckenstein: A super-duper bad-loan bailout scam

10/22/07 Call it Super SIV Mae. Wall Street's pals in the Treasury Department want to ride to the rescue with a new entity of entitlement, the 'structured investment vehicle.'

This week I have another entity of entitlement to add to the list: "SIV Mae" (SIV = structured investment vehicle). That seems a fitting description of the super-duper bailout put together by the Goldman Sachs (GS, news, msgs) subsidiary known as the U.S. Treasury Department. (Goldman itself doesn't appear to be participating in the bailout, which is interesting.)

When I first heard about this, I was outraged, disgusted and slightly depressed. I thought, here we go, another bailout. Barney Frank and friends are trying to bail out the homeowners. Wall Street, the Treasury Department and the Bank of England appear determined to do whatever it takes so that we have absolutely no price discovery on any mortgage-related assets that may have gone bad -- thereby giving a pass to the folks who've made obscene amounts of money conceiving and marketing them. Whether you call this crony capitalism or socialism, the worst of it is what we have become.


To quote a knowledgeable friend of a friend: "How anyone can look at the creation of this fund as anything other than a cynical way of moving an existing pile of crap from one place to another is beyond me. The fact that no one seems to think there is anything wrong with it (and I include the regulators) tells you just how 'fixed' the markets' problems are.

more...
http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/ASuperDuperBadLoanBailoutPlan.aspx

[54anickel]

50. Anybody else got the feeling they caught a ride in the Way-back Machine?

One World, Taking Risks Together

http://www.nytimes.com/2007/10/21/weekinreview/21schwartz.html?_r=1&ex=1350705600&en=e63502a9a10429f6&ei=5088&partner=rssnyt&emc=rss&oref=slogin

HUGE financial losses in the United States spark fears in Europe. A credit crisis ensues. Soon the fear spreads to Wall Street, where the biggest banks fight off rumors of insolvency amid a broader economic panic, and Washington is forced to step in. The market swoons. If this sounds familiar, it should. Except we’re not talking about the subprime mortgage crisis, or the deal brokered by the Treasury Department last week with three American banking giants to cough up $75 billion for a fund aimed at stabilizing the global credit market, or Friday’s 366-point drop in the stock market.

In fact, it’s a brief history of the Panic of 1907, which culminated exactly 100 years ago today.

Back then, losses stemming from the San Francisco earthquake the year before hammered British insurers and eventually forced government officials on this side of the Atlantic and none other than J. P. Morgan himself to come to the rescue. On the night of Oct. 21, 1907, the legendary tycoon summoned the country’s leading financiers to his Murray Hill mansion to help finance a bailout.

“This is where the trouble stops,” Mr. Morgan famously declared. He succeeded. By early 1908, the panic had passed.

Today, it’s J. P. Morgan again — the firm, not the man — along with Citigroup and Bank of America that are trying to fix things, with prodding from Henry M. Paulson Jr., the secretary of the Treasury, and, as the former head of Goldman Sachs, something of a latter-day tycoon.

Given the historical echo — as well as the 20th anniversary of the crash of Oct. 19, 1987 — it’s appropriate that the plan to ease the credit crunch is high on the agenda this weekend as the finance ministers of the Group of 7 leading industrial countries confer in Washington.

more...



http://www.reuters.com/article/ousiv/idUSN2033194520071020?pageNumber=1

Bankers wary of investment fund rescue effort

WASHINGTON (Reuters) - Bankers remain wary of plans to launch a massive investment rescue fund to soften the blow of the U.S. subprime meltdown, saying it could interfere with a market recovery and stall a resolution to the credit crisis.

Carl Stalberg, executive chairman of Swedbank (SWEDa.ST: Quote, Profile, Research), said on Saturday he doubted the fund would be an effective way for banks to liquidate billions of dollars in structured debt in markets where buyers have effectively gone on strike.

"It might be better to let the markets work it out. Trading platforms like that are always a difficult task," Stalberg told Reuters on the sidelines of a banking conference.

Stalberg spoke one day after a meeting of finance officials from the Group of Seven rich nations where U.S. Treasury Secretary Henry Paulson lobbied in support of the plan, which aims to restore confidence in the financial sector.

Bank of America Corp (BAC.N: Quote, Profile, Research), Citigroup Inc (C.N: Quote, Profile, Research) and JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) announced on Monday plans to create the multibillion dollar fund, which was hatched with the U.S. Treasury's blessing.

The fund is intended to prevent bank-affiliated Structured Investment Vehicles, or SIVs, from dumping billions of dollars of bonds linked to subprime mortgages and other debt back into financial markets.

But despite the U.S. government's active role in seeking support for the plan, many bankers and investors remain cautious -- with some saying they have nothing to gain by participating.

snip to the ironic part>

Perhaps the sharpest indictment came from Alan Greenspan, the former chairman of the U.S. Federal Reserve, who said the fund may hurt more than help. Greenspan told Emerging Markets magazine the fund runs the risk of further undermining already brittle confidence in besieged markets.

more...

[54anickel]

53. WUHBPH's tongue has been moving like a duck's ass these past few days...

Greenspan questions ‘superfund’

http://www.ft.com/cms/s/0/0f79b248-7e5c-11dc-8fac-0000779fd2ac.html

snip>

“It is not clear to me that the benefits exceed the risks,” the former chairman of the Federal Reserve told Emerging Markets magazine. He added, “The experience I have had with that sort of intervention is very mixed.”

snip>

Mr Greenspan said on Friday: “What creates strong markets is a belief in the investment community that everybody has been scared out of the market, pressed prices too low and there are wildly attractive bargaining prices out there.” He added: “if you intervene in the system, the vultures stay away. The vultures are sometimes very useful.”

The former Fed chief did not say he opposed the superfund and did not advocate selling assets at firesale prices. He said the 1998 Fed-sponsored rescue of Long-Term Capital Management worked because it took a set of assets that would otherwise have been dumped at firesale prices off the market, allowing prices to find a true equilibrium. But he said today “we are dealing with a much larger market”.

Mr Greenspan’s doubts about the proposed fund are shared by some of the world’s most successful investors.

Warren Buffett told Fox Business Network that “pooling a bunch of mortgages, changing the ownership” would not change the viability of the mortgage instrument itself. “It would be better to have them on the balance sheets so everyone would know what’s going on.”

Bill Gross, chief investment officer of Pimco, the giant bond fund manager, has called the superfund idea “pretty lame”.






Crisis was "accident waiting to happen": Greenspan

WASHINGTON (Reuters) - An unusually high degree of risk taking across asset classes made recent financial market turmoil all but inevitable, former Federal Reserve Chairman Alan Greenspan said on Sunday.

"The financial crisis that erupted on August 9 was an accident waiting to happen," Greenspan said in a speech on the sidelines of the International Monetary Fund and World Bank meetings. "Credit spreads across all global asset classes had become suppressed to clearly unsustainable levels."

"Something had to give."

"If the crisis had not been triggered by a mispricing of securitized U.S. subprime mortgages, it would eventually have erupted in some other sector or market," Greenspan said.

more....


Isn't this all exactly the kind of shit Chopper Ben was anxiously studying for all those years? :eyes:

[kineneb]

62. what is it about October and financial crises? n/t

[Roland99]

54. 10:50am - Blood seeping thru the bandages

Dow 13,438.86 -83.16
Nasdaq 2,729.18 4.02
S&P 500 1,494.70 -5.93
10 YR 4.39% -0.01
Oil $86.50 $-2.10
Gold $756.00 $-12.40

[54anickel]

57. Cover your money; banks do fail

Now here's an article that just oozes with confidence

http://www.ajc.com/business/content/business/stories/2007/10/18/safemoney_1019.html

For most of us, our bank accounts are lifelines for making vital payments from mortgage notes to grocery bills.

And for the most part, we rarely give a second thought to the stability of the bank we've picked to hold our money.


That's especially true because the Federal Deposit Insurance Corp. guarantees the safety of our deposits up to $100,000 or $250,000, depending on type of account, against bank failures.

But before you say, "So what? I don't have $100,000," consider that at some point, you may receive an inheritance, collect an insurance settlement or sell your home. Any one of those events could push you, even temporarily, above the FDIC limits.

Though bank failures are rare, depositors who exceed the insurance limits would be left waiting in line to see how much of their uninsured deposits they'll get back. Such is the case with former customers of Alpharetta-based NetBank, which federal regulators seized Sept. 28 in the largest bank failure in Georgia history.

Those customers had a total of $109 million in uninsured deposits. The FDIC covered half that amount immediately. Now, the depositors are waiting to see how much of the rest of the balance they will recoup, if anything.

Looking at U.S. bank failures since 2000, consumers have gotten roughly anywhere from 40 cents to 90 cents of every $1 they had in uninsured deposits.

So how do you get the maximum coverage?

more...

[Theres-a]

58. Chilling. nt

[AnneD]

65. During the S&L Scandel.....

and the Houston Real Estate bubble, I had my bank go under. I am an informed consumer-and didn't have mega millions in the bank, but my student loan was parked there and got all my money but it took a few days and I had them give me a letter that stated the bank had closed and made sure that any outstanding checks that bounced were paid and I gave them a copy of the letter I got. It was nothing more than an inconvenience for me. I have seen more than one place that wasn't FDIC insured. I don't bank there. Because of my experiences, I have learned what to look for when a bank is having problems;)

The FDIC insures 100K per account so all you have to do is open several accounts up to the 100k limit to get around the law, and that is easy enough to do..

[bain_sidhe]

66. Reflation! (of the markets, that is...)

Happy days are here again! Ponies all around! (But watch where you step...)

[ozymandius]

71. closing up shop

Dow 13,566.97 Up 44.95 (0.33%)
Nasdaq 2,753.93 Up 28.77 (1.06%)
S&P 500 1,506.33 Up 5.70 (0.38%)
10-Yr Bond 4.393% Down 0.008
NYSE Volume 3,476,319,750
Nasdaq Volume 2,033,366,500

4:20 pm : Monday was a day that traders can appreciate as the market had a roller coaster session that was accented by a noticeable downturn at the start of trading and an equally noticeable comeback effort.

At their lows for the session, which were established just after the start of trading, the Dow, Nasdaq and S&P fell 114, 27 and 10 points, respectively. The declines followed on the heels of Friday's steep losses and big percentage declines in a host of foreign markets.

Interestingly, the declines abroad were attributed to G-7 finance ministers' thinking over the weekend that global economic growth will moderate. The reasoning for those declines, though, was poor considering the IMF cut its global growth forecast last week. In other words, the G-7 ministers weren't telling the markets anything they didn't already know.

The declines in foreign markets were little more than a reflex response to the large losses seen on Friday on Wall Street.

Early selling efforts in the U.S., though, were quickly met with bottom-fishing interest that was plain to see in the attraction to homebuilding, financial and retail names that were among the hardest hit issues last week.

The energy sector (-1.3%) was a notable laggard again as oil prices dipped 1.2% to $87.56. With an excuse needed for every move, concerns about a slowdown in growth got the call for explaining the pullback in crude prices. That excuse, however, doesn't jive with the stock market's performance on Monday as the financial (+1.0%), consumer discretionary (+1.0%), industrial (+0.5%) and technology (+1.0%) sectors led today's action.

In turn, the Treasury market was on the defensive a bit, which wouldn't have been the case if concerns about a slowdown in growth were the real factor for selling in the energy pits that they were made out to be. That's not to say slowdown concerns won't provide a real reason for selling tomorrow, or the next day, but the excuse just didn't mesh with Monday's stock market action.

Reassuring earnings news from Merck (MRK 54.64, +1.53), Kimberly-Clark (KMB 70.19, +3.05) and Royal Caribbean (RCL 42.26, +3.01) provided some support for Monday's bottom-fishing buying interest. Schering-Plough (SGP 28.34, -4.37), however, was a drag on the health care sector (-0.2%) after missing analysts' expectations by two cents.

Separately, the dollar index got a nice boost (+0.8%), which contributed to the weakness in gold prices (-1.4% to $757.60/oz) and other commodities.DJ30 +44.95 NASDAQ +28.77 SP500 +5.70 NASDAQ Dec/Adv/Vol 1179/1782/1.98 bln NYSE Dec/Adv/Vol 1457/1792/1.39 bln