STOCK MARKET WATCH, Wednesday October 31

[ozymandius]

Source: du

STOCK MARKET WATCH, Wednesday October 31, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 447 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2482 DAYS
WHERE'S OSAMA BIN-LADEN? 2202 DAYS
DAYS SINCE ENRON COLLAPSE = 2163
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 30, 2007

Dow... 13,792.47 -77.79 (-0.56%)
Nasdaq... 2,816.71 -0.73 (-0.03%)
S&P 500... 1,531.02 -9.96 (-0.65%)
Gold future... 787.80 -4.80 (-0.61%)
30-Year Bond 4.67% +0.01 (+0.21%)
10-Yr Bond... 4.38% UNCH (UNCH)






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. My thanks to everyone who offered advice to my question yesterday.

A student asked 'what gives money its value'. Today we will have time to open that subject. So I thank everyone who offered a metaphorical way of expressing monetary value concepts.

:hi:

[ozymandius]

2. Market WrapUp

Halloween Scariness in the Financial Sector
BY FRANK BARBERA, CMT

Another day, another week, and soon a new month, and the news just continues to fall off a cliff. As investors woke up this morning they were greeted by the headlines of Home Prices falling for the eighth month in a row, with no turnaround in sight. Turns out, Home prices fell in August by 5% from a year ago, recording the biggest decline since 1991 when prices fell 6.3% in April 1991. The Case-Shiller Index showed its lowest annual returns ever recorded in August, with Cleveland down 4.1%, Las Vegas down 7.6%, Miami down 7.8%, Minneapolis down 4%, Phoenix down 8%, San Diego down 8.3%, Washington DC down 7.2% and Tampa, with the biggest loss of all down 10.1%. The picture in the Housing market is bleak, with panelists at a Housing Industry conference in California, Jeffrey Mezger, CEO of KB Homes, and Angelo Mozilo, CEO of CountryWide Financial along with California State Treasurer Bill Lockyer, suggesting to the Wall Street Journal that “home prices in California could decline on the order of 10% to 15% in the year ahead.” After reaching a cycle high of $484,000, the latest September median home price came in at $430,000, already more than 10% off the cycle high.

Of course, none of this news is helpful to the world of Structured Finance, where CDO pricing remains under intense downside pressure. Using the indices tracked by Markit.com, the TABX Index which is a proxy for the world of Collateralized Debt Obligations (CDO’s) has deteriorated 18 to 35% across all tranches in recent weeks, not a pretty picture by any means. None of this is lost on the management of some of the largest SIV’s or Structured Investment Vehicles where SIV’s closely linked with three of this country's largest banks, JP Morgan Chase, Bank of America and Citigroup, need to find $100 billion in fresh investment capital to roll over debts coming due in the next six to nine months. Of course, the large banks are looking to create the SIV Superfund, in an effort to keep these liabilities off balance sheet. Yet the recent disclosures from Merrill Lynch which under-estimated its CDO losses by several billion dollars (4.5 billion original to 7.90 billion final), tell us just how vague and opaque the pricing is on the paper of these CDO and SIV holdings.

-cut-

In the end, the rapidly escalating downhill slide of the US Dollar may very well be the straw which breaks the proverbial camel's back. In its efforts to save the US Housing sector, and mitigate a building US Recession, neither one of which is likely to be effective, the US Fed has told the rest of the world that the Dollar is their problem -- to be sure, a message resonating loudly in the board rooms of Daimler Benz, Toyota and Hyundai. As the Dollar continues its steady path lower, the ongoing signs of Stagflation become overwhelming even in daily life within the US. Sure, for many who pay no attention to the prices paid, the skyrocketing movement of food prices may not be clearly evident. Yet, it is prices across a broad front of consumer products which are moving up at a real world rate often in excess of a 10% annualized rate of change. With Crude Oil and Heating Oil at new all time highs and winter approaching, we are sure to see gasoline prices surge come the spring of next year. Perhaps $5, $7 or $10 per gallon gasoline will finally grab hold of the public's attention, as the mainstream lack of questioning on the CPI data beggars the mind. How, How, How can reported energy costs be up 5% year to date when Crude Oil, Heating Oil and Gasoline prices are all up 40% YTD? Some pretty fancy math to achieve that end result, which at the end of the day simply puts untenable strain of the budgets for the Middle Class. Of course, a key verdict on this note might come from the market with a major break below long time support on Wal-Mart Stores at $42.

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

[ozymandius]

3. Today's Reports

8:30 AM GDP-Adv. Q3
Briefing Forecast 3.3%
Market Expects 3.1%
Prior 3.8%

8:30 AM Chain Deflator-Adv. Q3
Briefing Forecast 2.3%
Market Expects 2.0%
Prior 2.6%

8:30 AM Employment Cost Index Q3
Briefing Forecast 0.9%
Market Expects 0.9%
Prior 0.9%

9:45 AM Chicago PMI Oct
Briefing Forecast 53.0
Market Expects 53.0
Prior 54.2

10:00 AM Construction Spending Sep
Briefing Forecast -0.1%
Market Expects -0.4%
Prior 0.2%

10:30 AM Crude Inventories 10/26
Briefing Forecast NA
Market Expects NA
Prior -5288K

2:15 PM FOMC policy statement

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

[ozymandius]

5. Today's Question

Will the Federal Reserve torpedo the dollar in order to rescue the Big Banks' balance sheets?

[ozymandius]

9. Answer: Fed expected to cut rates for 2nd time

WASHINGTON - With oil prices soaring and the housing market sinking, the Federal Reserve is likely to combat the economic turmoil with more interest rate cuts.

Federal Reserve Chairman Ben Bernanke and his colleagues were wrapping up a two-day meeting Wednesday and many economists believe they will announce that they have decided to follow September's half-point cut in the federal funds rate with a quarter-point cut at this meeting.

"They are going to cut rates," predicted Mark Zandi, chief economist at Moody's Economy.com. "The economy is weakening and financial markets remain unsettled."

Many analysts said this rate reduction probably will not be the last either, as the central bank keeps reducing rates to help the economy overcome a host of problems.

http://news.yahoo.com/s/ap/20071031/ap_on_bi_ge/fed_interest_rates

---

So the Fed wants to recreate the conditions that brought us to this sorry state. Meanwhile - Paulsen yammers on about our 'strong dollar' policy.

[ozymandius]

11. Rate cut unlikely to fix housing woes

WASHINGTON - The interest rate cut that Wall Street believes will buffer the economy from housing market woes is unlikely to give much of a boost to suffering banks and homebuilders in the near term, analysts say.

The Federal Reserve policymaking committee is expected to approve cutting a key short-term rate at least a quarter percentage point Wednesday to help the economy get through a deeper-than-expected housing slump and credit crunch that accelerated in August.

Investors are betting the central bank will reduce the federal funds rate, the rate banks charge each other for overnight loans, to 4.5 percent. Over the next 12 to 18 months, lower short-term rates will aid the overall economy because many equity credit lines and some credit card rates are pegged to short-term market rates.

Yet the Fed's efforts now, on top of a half-percentage-point rate cut in September, won't change the outlook much, if at all, for companies on the front lines of surging mortgage defaults and a dried-up market for complex securities backed by home loans.

http://news.yahoo.com/s/ap/20071031/ap_on_bi_ge/fed_interest_rates_housing

[Roland99]

16. The Fed is only interested in maintaining rising stock prices.

The economy as a whole be damned.

[UpInArms]

30. Fed seen taking out a little rate cut insurance

http://www.reuters.com/article/bondsNews/idUSN3128732620071031?sp=true

WASHINGTON (Reuters) - The Federal Reserve is expected to lower benchmark borrowing costs modestly on Wednesday as an additional bulwark against the risk a housing slump and tighter credit drag down the rest of the economy.

Fed officials, who will announce their decision around 2:15 p.m., resumed their two-day meeting at 9 a.m.

They have offered few clues on their likely course of action, but financial markets are betting that a spate of weak economic data will lead policy-makers to cut overnight U.S. interest rates by a quarter-percentage point, to 4.5 percent.

That would follow last month's surprisingly large half-point reduction, a move Fed officials had hoped would put them out in front of any potential economic weakness.

"In an economic expansion that had already slowed, leading sectors continue to display surprising softness and further cautious policy action can help to contain a widening out of the damage," Citigroup economist Robert DiClemente wrote in a recent analysis.

...more...

[Demeter]

41. Also Known as "Trick or Treat?"

And probably both.

[UpInArms]

21. 8:30 reports in - increased chocolate rations for everyone!

07. U.S. Q3 exports rise at 16.2% pace, best in 4 years
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

08. U.S. Q3 business investment rises at 7.9% pace
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

09. U.S. Q3 housing investment falls at 20.1% pace
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

10. U.S. Q3 consumer spending up at 3% pace
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

11. U.S. Q3 ECI up 3.3% yr-on-yr vs 3.3% in Q2
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

12. U.S. Q3 core consumer inflation up 1.8% annualized
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

13. U.S. Q3 GPD price index up 0.8%, lowest in 9 years
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

14. U.S. Q3 final sales rise 3.5%
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

15. U.S. economy achieves best growth in six quarters
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

16. U.S. Q3 ECI up 0.8% vs 0.9% expected
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

17. U.S. Q3 GDP rises 3.9% annualized vs. 3.4% expected
8:30 AM ET, Oct 31, 2007 - 9 minutes ago

[AnneD]

27. Most of the "great" numbers....

can be pegged to the weak dollar. America is one big blue light special.

[Hugin]

33. It'll all be quietly redacted in a couple of days anyway...

:eyes:

I keep warning and nobody listens... Lies have a way of snowballing on those who tell them.

'Nuff said.

[UpInArms]

22. oops!

that dreaded double post thingie!

:blush:

[UpInArms]

32. October Chicago PMI 49.7% vs. 54.2% in September

01. October Chicago PMI 49.7% vs. 54.2% in September
9:47 AM ET, Oct 31, 2007 - 1 minute ago

[Roland99]

36. U.S. economy grows at 3.9% pace in third quarter ... (WTF?)

U.S. economy grows at 3.9% pace in third quarter
Best growth since early 2006 driven by consumers, exports, military

http://www.marketwatch.com/news/story/us-economy-grows-39-fastest/story.aspx?guid=%7B33464B2D%2D9070%2D4B37%2D95AA%2DE18239F34960%7D

Consumer spending, the largest component of GDP, rose at a 3% pace. Spending on durable goods rose 4.4%, spending on nondurable goods rose 2.7% and spending on services increased 2.9%. Consumer spending contributed 2.1 percentage points to the 3.9% growth rate. :wtf:

Business investments increased 7.9%, including a 12.3% rise in structures and a 5.9% gain in equipment and software investments. Capital spending on equipment and software increased at the fastest pace since early 2006, while investments in structures slowed from a 26-year high in the second quarter. Business investments contributed 0.8 percentage points to growth.

Businesses added $15.7 billion to their inventories, contributing 0.4 percentage points to growth. Inventory growth in the third quarter could rob growth from the fourth quarter if businesses have to work down their inventories. Inventories remain extremely lean, however.

Investments in homes fell by 20.1% annualized, the seventh straight decline and nearly matching the 20.4% decline a year ago. Residential investments cut 1 percentage point from growth.

Exports surged again in the third quarter, rising at a 16.2% annual rate, the best in nearly four years. Exports of goods jumped 23%, the most in 11 years. Imports, meanwhile, increased at a 5.2% pace. Net exports contributed 0.9 percentage points to growth.

Government spending increased 3.7%, with most of the growth coming from the 9.7% rise in defense spending. Government spending contributed 0.7 percentage points to growth, including 0.5 percentage points from the military.

So, w/o the housing bust, GDP growth would be 4.9%?!?


Something smells VERY rotten!!

[Hugin]

40. It's all in how they add...

some factors into the pie several times.

and notice the "Government Spending" area with it's 9.7% increase in 'Defense Spending'.

Handing cash to Halliburton doesn't do the local economy any good since they moved to Dubai.

[AnneD]

45. Think about that weak dollar....

that accounts for the increase in exports. No matter what they say, I still think inflation accounts for much of this increased consumer spending. Does this count the back to school in this quarter? If it does then that combined with the infaltion does not look so hot to me.

[Ghost Dog]

50. U.S. economy "incredibly resilient" - White House

http://www.reuters.com/article/bondsNews/idUSWBT00784120071031?rpc=401&

WASHINGTON, Oct 31 (Reuters) - The U.S. economy has proven resilient in the face of a housing market downturn, thanks to a strong job market and growth in exports, White House economic adviser Edward Lazear said on Wednesday.

"The economy is incredibly resilient," Lazear said in an interview on CNBC after the Commerce Department reported that the U.S. economy grew at a faster-than-expected 3.9 percent annual rate in the third quarter.

"We've obviously been suffering through a very weak housing market. This is a very good sign," he said.

Incredible, indeed. :rofl:

[Hugin]

54. Yeah, darned thing... They just keep trying to kill it. n/t

[Roland99]

48. U.S. employment costs up 0.8% in third quarter

http://www.marketwatch.com/news/story/us-employment-costs-rise-08/story.aspx?guid=%7B931E0826%2DD58C%2D4171%2D9D86%2D37C3A3EA7A5A%7D

The Fed pays attention to employment costs in the belief that inflation can only be sustained if workers force their bosses to pay higher compensation, which is then passed on to customers in the form of increased prices.

The fact that the latest measurement of such costs did not accelerate in the third quarter may make it easier for the Fed to cut interest rates at their meeting later Wednesday. A statement from the central bank is expected at 2:15 p.m. Eastern time. See full story.

The consensus forecast of Wall Street economists is that the Fed will cut interest rates by a quarter of a percentage point, to 4.5%, in a further effort to counter the depressing effects of the housing market downturn and the credit crunch.

Soo...we're told that GDP grew at a very healthy 3.9%. If that's TRULY the case (which I VERY seriously doubt as we know in the last couple of years, a huge portion of GDP growth came solely from MEW - Mortgage Equity Withdrawal - which has all but completely disappeared). Anyway, IF GDP is really at 3.9% in Q3, then WHY IN THE HELL would the Fed even consider cutting the rate right now? Isn't 3.9% almost an "overheated" economy?

Cutting rates to boost growth would surely cook the books...er....overheat the economy, right? I mean, we'll have employers BEGGING people to come work for them for minimally $20/hr with full health insurance and a guaranteed pension. People will be buying new/existing homes left and right! LCD TVs will fly off the shelves! DisneyWorld will be busting at the seams every day! Restaurants will have to hire more staff and grocers will have to build more stores.

Ahhh...Utopia!




How fitting that the music I'm listening to now is the theme from Psycho!!

[Ghost Dog]

61. Fed cuts key interest rate by 1/4 point

http://news.yahoo.com/s/nm/20071031/bs_nm/usa_fed_dc

WASHINGTON (Reuters) - The Federal Reserve cut the benchmark federal funds rate by a quarter-percentage point to 4.5 percent on Wednesday to buffer the economy against a housing downturn and tighter credit conditions.

/..

[Buttercup McToots]

4. Bank exec's departure package includes money for party

Bank exec's departure package includes money for party


Online

MB Financial Inc. doesn’t appear too upset that Richard Rieser is leaving the company, but it’s paying to throw him a party anyway.

Mr. Rieser’s separation agreement with MB calls for a “departure party,” for which MB “shall provide reasonable funding” with “the attendance list and arrangements to be made by (Mr. Rieser),” according to a filing with the Securities and Exchange Commission.”

Mr. Rieser, MB’s former vice-chairman, executive vice-president and chief marketing and chief legal strategist, resigned from the Chicago-based bank on Oct. 23, according to the filing. Mr. Rieser joined MB when it acquired First Oak Brook Bancshares Inc. in June 2006 for $366 million. He had been First Oak Brook’s CEO.

“It’s unusual for a company to spell out in that level of detail what they’re providing in a separation agreement,” said Don Delves, president of Delves Group, a Chicago-based executive compensation consulting firm. “Those are the sorts of things that make shareholders and the public in general roll their eyes.”

http://www.chicagobusiness.com/cgi-bin/news.pl?post_date=200....


:puke:

[ozymandius]

6. Dang! And I was just about to eat breakfast.

[Hugin]

34. Yep, it worked...

:eyes:

[ozymandius]

7. Oil prices fall below $90 in Asia (awaiting the Fed's lead $ balloon)

SINGAPORE - Oil prices dropped below $90 a barrel Wednesday ahead of the U.S. central bank's impending decision on its key interest rate.

Light, sweet crude for December delivery fell 68 cents to $89.70 a barrel in Asian electronic trading on the New York Mercantile Exchange by midmorning in Singapore.

The Nymex crude contract fell $3.15 to settle at $90.38 a barrel Tuesday, partly due to a research report from influential trading house Goldman Sachs advising clients to sell oil futures to lock in profits.

-cut-

A larger-than-expected cut would further weaken a greenback already at multiple-decade lows against major currencies. Oil futures have been driven to record levels the past week partly because they offer a hedge against a weak dollar.

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

[Ghost Dog]

51. Oil rallies to $93 on U.S. inventory slump

http://news.yahoo.com/s/nm/20071031/bs_nm/markets_oil_dc;_ylt=An9rTrMTQs2axoZ9CfH5YRm573QA

LONDON (Reuters) - Oil rallied to $93 a barrel on Wednesday after weekly data showed U.S. crude inventories unexpectedly slumped by 3.9 million barrels, countering expectations for an increase.

U.S. oil futures rose $2.43 to $92.81 a barrel by 11:08 a.m. EDT, off lows of $88.92, on top of a $4 slide in the previous session. It hit a record high of $93.80 on Monday.

London Brent gained $2.39 to $89.83.

Commercial stockpiles of crude oil in the United States fell by 3.9 million barrels to 312.7 million barrels in the week ended October 26, said the Energy Information Administration on Wednesday. Analysts had forecast a rise of 600,000 barrels in a Reuters poll.

"I am very surprised, the crude number is insanely bullish, it's a big drop, for the second week in a row," said Mike Wittner, global head of oil research at SocGen in London.

/...

[Roland99]

52. CRUDE-OIL FUTURES RALLY TO NEW HIGH OF $94 FOLLOWING INVENTORY REPORTS

Crude futures rally on surprise drop in inventories
A possible rate cut from the Fed in the afternoon could further lift oil

SAN FRANCISCO (MarketWatch) -- Crude-oil futures rallied to trade near record highs on Wednesday after the Energy Department reported a surprise drop in U.S. crude inventories in the latest week, while a possible rate cut this afternoon from the Federal Reserve could further lift oil prices.

Crude oil for December delivery rallied $2.58, or nearly 3%, to $92.96 a barrel on the New York Mercantile Exchange. The contract hit an intraday high of $93.67 a barrel in electronic trading after the release of inventory data, close to the record high of $93.80 set
on Monday. Futures prices of petroleum products also surged.
Crude supplies fell by 3.9 million barrels to 312.7 million barrels in the week ending Oct. 26, the Energy Information Administration said Wednesday. Analysts surveyed by Platts expected on Tuesday a build of 1.25 million barrels in commercial crude stocks.

"Oil is up sharply and recovering most of yesterday's price decline due to a major disappointing surprise from a second consecutive weekly crude oil inventory decline," said John Person, president of National Futures Advisory Service. "With a weaker dollar, expectations that the Fed may cut rates, one cannot expect prices to decline much if at all this week."

[Hugin]

55. It's okay... Unka Dick has assured us this will not have any effect on the economy.

They'll just print more $$$.

It'll be fine... Really... Not to worry... Be happy... Did I mention 9/11?

[Ghost Dog]

8. Global stocks subdued

http://asia.news.yahoo.com/071031/3/3a640.html

HONG KONG (Reuters) - The dollar touched an all-time low against the euro on Wednesday, while Asian stock markets marked time as many investors sat on the sidelines ahead of a widely expected interest rate cut by the U.S. Federal Reserve.

European equity markets were also set for a largely steady open as investors digest a slew of earnings, headed by Deutsche Bank . Financial bookmakers were picking small opening gains in London, small losses in Germany and around breakeven in France

Caution ahead of the U.S. rate call also kept base metals subdued, but oil extended its slide below $90 a barrel amid recovering Mexican oil exports and an expected increase in U.S. weekly crude inventories.

"We're on Fed watch, but the view is a little murky so trade is likely to be very thin -- no one wants to put their head into a buzzsaw," said MF Global commodities analyst Edward Meir.

/...

[Ghost Dog]

49. European stocks up with banks

http://today.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-10-31T131207Z_01_L3123833_RTRIDST_0_MARKETS-EUROPE-STOCKS-UPDATE-2-REFILE.XML

PARIS, Oct 31 (Reuters) - European stocks were mostly higher by midday on Wednesday, as a lack of negative surprises in Deutsche Bank's (DBKGn.DE: Quote, Profile , Research) results pleased investors and sent banking stocks higher.

But with the U.S. Federal Reserve widely expected to unveil a rate cut after European markets close, investors remained cautious.

At 1223 GMT, the FTSEurofirst 300 <.FTEU3> index of top European shares was up 0.3 percent at 1,587.04 points.

European banking shares advanced across the board after Deutsche Bank (DBKGn.DE: Quote, Profile , Research) beat its own earlier forecast with a 1.4 billion euro third-quarter pretax profit despite making a loss at its flagship investment banking division.

...

Deutsche Bank gained 4.4 percent, while Royal Bank of Scotland (RBS.L: Quote, Profile , Research) added 2 percent and Societe Generale (SOGN.PA: Quote, Profile , Research) surged 2.5 percent.

The DJ Stoxx European banking index <.SX7P> gained 1.5 percent after bearing the brunt of investor worries over a crunch in the credit market in recent months.

The banking index is down 7 percent on the year, going in the other direction to the broad FTSEurofirst 300, which has gained 7 percent.

Around Europe, Germany's DAX index <.GDAXI> was up 0.2 percent, UK's FTSE 100 index .FTSE up 0.2 percent and France's CAC 40 <.FCHI> up 0.3 percent.

/...

[Ghost Dog]

59. European stocks rise with banks; Fed in focus

http://today.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-10-31T163529Z_01_L31808191_RTRIDST_0_MARKETS-EUROPE-STOCKS-CLOSE-URGENT.XML

PARIS, Oct 31 (Reuters) - European stocks rose on Wednesday, closing at a two-week high as strong U.S. data lifted the mood ahead of the U.S. Federal Reserve's interest rate decision.

Banking shares rose, as investors were relieved by the lack of negative surprises in Deutsche Bank's (DBKGn.DE: Quote, Profile , Research) results. Deutsche gained 3.4 percent, while Credit Suisse (CSGN.VX: Quote, Profile , Research) added 1.4 percent and Societe Generale (SOGN.PA: Quote, Profile , Research) surged 2.3 percent.

The FTSEurofirst 300 <.FTEU3> index of top European shares unofficially closed 0.75 percent higher at 1,593.58 points. It ended the month with a gain of 2.8 percent.

/...

[Ghost Dog]

58. Europe October Inflation Accelerates to Two-Year High

http://www.bloomberg.com/apps/news?pid=20601085&sid=aOZPtQFa4DPI&refer=europe

Oct. 31 (Bloomberg) -- European inflation accelerated more than economists forecast in October, while confidence in the economy declined, underlining the European Central Bank's quandary over whether to raise interest rates.

The inflation rate in the 13-nation euro area rose to a two-year high of 2.6 percent from 2.1 percent in September, the European Union's statistics office in Luxembourg said today. That was above the 2.3 percent expected by economists. An index of executive and consumer sentiment fell to a 19-month low of 105.9 in October, according to a separate report.

ECB policy makers are divided on whether to focus on inflation or economic growth when deciding on interest rates. An 80 percent jump in the price of oil since mid-January is stoking inflation, while the collapse in U.S. subprime mortgages that pushed up credit costs globally and the euro's increase to a record against the dollar threaten to curb the pace of expansion.

``The inflation rate will worry them, but basically their hands are tied'' at the ECB, said Aurelio Maccario, an economist at Unicredit MIB in Milan. ``With the money market still stuck and the euro at almost $1.45, the conditions do not allow them to tighten.''

The October inflation reading is the highest since September 2005, when it was also 2.6 percent. The rate was last higher in June 2001, at 2.8 percent. Crude-oil prices reached a record $93.80 a barrel on Oct. 29.

/...

[ozymandius]

10. Data add to gloom on US economy

A raft of bearish data fuelled fears of a US economic slowdown on Tuesday as consumer confidence slumped to a two-year low and house prices in major cities suffered the biggest drop in 16 years.

The growing evidence that the credit squeeze and housing meltdown are spreading to the rest of the domestic economy will increase pressure on the Federal Reserve to set aside concerns over rising inflation and cut interest rates on Wednesday.

Blue chips such as Procter & Gamble and US Steel added to the gloom with results that disappointed investors and contributed to a 0.3 per cent fall in the S&P 500 in New York midday trading.

-cut-

The October drop in in the monthly consumer confidence index was larger than expected and raised the prospect of a marked deterioration in business conditions in sectors such as retail and consumer goods during the crucial holiday shopping season.

The resilience of US consumers - a key driver of economic growth in both the US and emerging markets like China - was further tested by a downbeat report on house prices.

http://news.yahoo.com/s/ft/20071030/bs_ft/fto103020071434591055

[Roland99]

17. If gaskeeps going up, expect that consumer confidence to keep dropping

Up to $2.99 all over here now.

[ozymandius]

12. I hope today's number acrobatics are fun to watch.

:donut: :donut: :donut:

And I hope you find some amusement from the CNBC shills' tortured reasoning about why the Fed works to god-like perfection.

I'll check back in when all is said-n-done.

Ozy :hi:

[Roland99]

18. I'm sure the Fed wll 'treat' the banks and corps...

And 'trick' the rest of us.

[UpInArms]

13. dollar watch

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

Last trade 76.757 Change -0.007 (-0.01%)

Ahead of the Fed Dollar at New Lows

http://www.dailyfx.com/story/bio2/Ahead_of_the_Fed_Dollar_1193827418922.html

The dollar reached new lows in early European trade today, with EURUSD hitting 1.4468 while GBPUSD broke above the 2.0700 level as traders continued to sell the greenback ahead of the FOMC rate announcement at 14:15 GMT. The market widely expects the Fed to lower rates by 25bp to 4.50% but given yesterday worse than expected consumer confidence figures, most participants now believe that the Fed will be forced to lower rates once again at the December FOMC meeting.

Should that happen, the buck’s interest rate differential against the euro will shrink to only 25bp while the pound will then command a l50bp premium in rates. In short, the pressure on the dollar appears relentless and only a stronger than forecast NFP report this Friday could possibly pull it out of its current tailspin. Today’s ADP data may provide some forward guidance as to the NFP results, but if –like most recent US data – it points to more weakness, the greenback could come under a fresh assault in the New York session.

Ultimately, today’s direction is likely to be set by the Fed. The US policy makers find themselves in terrible quandary as they try to address the rapid deceleration in US demand while at the same time avoiding further decline in the dollar. Traders will parse the Fed communiqué for any clues to future action, but given the change of sentiment in the market over the past several weeks, the Fed’s words may be obsolete almost as soon as they are released. US monetary authorities are now hostage to the latest economic news and should the data show further deterioration Dr. Bernanke will be forced to again loosen monetary policy come December regardless of what they state today.

The one major that continues to lose ground against the dollar is the yen. As expected the BOJ kept rates unchanged as governor Fukui noted that downside risks with regard to global growth and financial markets continue to persist. He also suggested that global yields have come under downward pressure providing another reason why Japan cannot adjust interest rates higher. Most market players now speculate that Japanese rates may remain at these ultra low levels for the remainder of Mr Fukui"s term which ends on March 21. Should that occur the yen will continue to remain the preferred funding currency for the carry trade and will weaken any time equity markets prove supportive of risk.

...more...

US Fed: Highly Anticipated 25bp Rate Cut Promises Wild Price Action

http://www.dailyfx.com/story/topheadline/US_Fed__Highly_Anticipated_25bp_1193767526900.html

Fed fund futures continue to price in a 92 percent chance of a 25bp rate cut on Wednesday to 4.50 percent. With FOMC member Mishkin noting that the markets have not fully normalized yet, it appears that the central bank will indeed loosen monetary policy. The question is: how will they go about it? Will they cut the federal funds rate and the discount rate like they did in September, or will they try to target the credit crunch by only easing the discount rate? The latter option may be able to give the US dollar a long awaited bid tone while allowing the equity markets to deflate slowly rather than crashing. Regardless, the Federal Reserve’s policy decision on October 31st promises to spark some wild price action market-wide:

Frederic Mishkin, Federal Reserve Board Governor (Voting Member)

“Since the Federal Reserve cut interest rates and added liquidity to the financial markets, functioning has not yet returned to normal.” – October 29, 2007

“…lowering the discount rate may also help underscore the central bank's intent to provide adequate liquidity to promote the functioning of financial markets…having a discount facility at its disposal provides a central bank with a more targeted tool for coping with financial disturbances without promoting inflationary tendencies.” – October 26, 2007

There is little doubt the housing market is still an issue, which will likely be noted in the FOMC policy statement:

Randall Kroszner, Federal Reserve Governor (Voting Member)

“We share the concerns of Congress that certain lending practices may have led to the problems we are seeing in the sub-prime market today.” – October 24, 2007

Henry Paulson, US Treasury Secretary

“I believe there is enough strength in our economy that we will continue to grow through this, housing is the weakest part of the economy.” – October 30, 2007

“All of those markets are doing better every day, as time goes on compared to where they were a number of weeks ago, but it is going to take a while to work our way through…Six months ago, a year ago, people were more optimistic that we had hit bottom. We haven't hit bottom yet in the housing area.” – October 30, 2007

Alan Greenspan, Former Federal Reserve Chairman

“Where the problem lies is in home prices -- new home prices, very specifically. The question is not so much the housing market per se, but it's the effect of housing on the economy overall.” – October 24, 2007

BOJ: Stubborn Deflation To Keep Rates On Hold

Bank of Japan monetary policy committee members have been notably absent from the press before the upcoming rate decision. Despite the fact that the economy remains in deflation and consumption trends have proven to be relatively lifeless, there are still hawks, such as Miyako Suda, Atsushi Mizuno and Tadao Noda, waiting in the wings. Nevertheless, government officials – who are widely perceived as being staunchly against rate normalization – continue to make their presence known and will likely publicly applaud the Bank of Japan’s expected decision to leave rates steady at 0.50 percent on Tuesday night:

Fukushiro Nukaga, Japanese Finance Minister

(Core consumer) prices are moving near zero, basically, but it is desirable for prices to stabilize in order (for people) to feel the economy's recovery.” – October 26, 2007

“Deflationary conditions haven't been completely overcome, but we are in the process of overcoming them…overall, prices are around zero and flat.” – October 30, 2007

Hiroko Ota, Japanese Economics Minister

“Conditions regarding prices haven't really changed these days. But I think prices will eventually rise, reflecting the recent tighter demand-supply situation.” – October 26, 2007

“The improvement in the job market has slowed slightly, but production is picking up. We don't need to worry about (the jobs data) that much.” – October 30, 2007

Nobuo Inaba, Bank of Japan Executive Director

“In guiding monetary policy, we need to carefully consider the effects, side effects and risks of our decisions. As a favorable mechanism in production, income and spending remains intact, we can expect the Japanese economy to achieve sustained growth under price stability.” – October 30, 2007

...more...

[UpInArms]

15. Dollar likely to drop no matter what Fed does

http://www.marketwatch.com/news/story/dollar-likely-drop-no-matter/story.aspx?guid=%7B14C9B622%2D63A2%2D428E%2DBA13%2D84C89F7ED734%7D&dist=MostReadHome

SAN FRANCISCO (MarketWatch) -- As analysts ponder the U.S. Federal Reserve's next move on interest rates, currency investors ponder the likely market reaction, and the consensus for both is that it's a matter of degree, not direction.

Just as no one is expecting an interest rate hike Wednesday, no one is betting on a sustained dollar rally this quarter, either. And just as bad economic or corporate headlines -- or even record-high crude oil prices -- rarely seem to derail stock market rallies these days, nothing the Fed delivers is likely to halt the greenback's slide.

Whether the Fed cuts its benchmark a quarter percentage point, as expected, or a half-point --or even not at all -- the dollar is likely to bear the near-term brunt of the market's kneejerk reaction either way, and then move in one direction: down.

Regardless of whether or not the Fed cuts rates, "the dollar is in for a beating," said Marilyn McDonald, marketing director at Interbank FX.

"The U.S. dollar is finally in trouble. For quite some time now, it has been one of the top five yielding currencies among the nations, which is why it has been used in the carry trade for so long," she said.

...more...

[DemReadingDU]

24. USD $76.621

Low 76.621 2007-10-31 08:23:36
http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

[DemReadingDU]

56. a bit lower $76.605

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

[DemReadingDU]

60. and lower $76.593

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

[DemReadingDU]

65. still dropping $76.465

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

[UpInArms]

26. Dlr rises, Treasuries slip after strong US GDP

http://www.reuters.com/article/bondsNews/idUSL3183176120071031

LONDON, Oct 31 (Reuters) - The dollar edged up from record lows on Wednesday while U.S. Treasuries and interest rate futures slipped after data showed the U.S. economy grew surprisingly strongly.

U.S. gross domestic product unexpectedly rose 3.9 percent on the year in the third quarter, its strongest quarterly growth since the first quarter of 2006.

The dollar rose to $1.4438 per euro <EUR=> having hit a record low pf $1.4467 earlier.

U.S. stock futures remained in positive territory (SPc1: Quote, Profile, Research), pointing to a firmer start on Wall Street later.

Twain said - there are lies, damn lies and then there are statistics

:shrug:

[UpInArms]

14. US safety chief under fire to quit after Halloween toy scare

http://news.yahoo.com/s/afp/uschinatradechildren

WASHINGTON (AFP) - Top Democratic lawmakers demanded Tuesday the resignation of the US consumer product safety chief and unveiled plans for stiffer enforcement laws after Halloween toys became the latest tainted made-in-China goods to be recalled.

Speaker of the House of Representatives Nancy Pelosi led her colleagues from the Democratic Party in calling on Nancy Nord, the chairwoman of the Consumer Product Safety Commission (CPSC), to quit amid more discoveries of tainted toys.

"I call on the president of the United States to ask for the resignation," Pelosi told a news conference at Capitol Hill with other lawmakers by her side.

To drive home her message, she displayed a collection of tainted toys and particularly waved a colorful top, whose lead content was found to be 200 times higher than permitted under law.

Also Tuesday, the CPSC came under fire in a expert report for lack of staff -- it has only one full-time toy tester -- and capability in examining imported items.

Nord, an appointee of President George W. Bush, has stood firm against proposed legislation seeking to increase the agency's authority and staff, double its budget and increase the maximum penalties for safety violations.

Her stand was largely in line with the broadly deregulatory approach of the Bush administration.

...more...

[AnneD]

25. Morning Marketeers....

:donut: and lurkers. Thank you for this particular article. It is, shall we say, sweet revenge. I had a co-worker send this RW wrapped in the flag urban legend e-mail about Denzel Washington writing a check for a recovery house for wounded veterans. This article from a San Antonio newspaper (?) then proceeded to attack 'librul' actors like Sean Penn for their anti war stance. Gritting my teeth, I politely pointed out that it was an urban legend (and gave the site). While Denzel did write a generous check-it in no way built a house. I also pointed out that Rosie O'Donnell was very instrumental in the projects development and donates far more to this project and she was not mentioned in the article (again I gave a website). I then asked her to refrain (still gritting my teeth) from sending me e-mails that were factually inaccurate,libelous, and defamatory. I was so careful and polite with my wording because after all, I have to work here.

Well, several days later I am doing our hazardous chemical in service. I am stressing the importance of this by mentioning that I had heard on the news this am that CPSC had only one toy safety inspector. My coworker said in a very snide way 'are you sure that is accurate'. There were several folks that chuckled-leading me to believe that she had shared my private e-mail. I responded that I had heard it on NPR not Fox and I was sure NPR does make an effort to check their facts and are more reliable than most. I let it pass.....

I sent her this today......Thanks, witchiness-one more of the many services I provide :evilgrin:


Happy hunting and watch out for the bears.

[DemReadingDU]

19. NYSE Eliminates Trading Curbs

Oct. 26 (Bloomberg) -- The New York Stock Exchange said it will no longer impose curbs on computer-program trading that were put in place after the crash of 1987, claiming they're no longer as effective in damping swings in prices.

The exchange will stop prohibiting brokerages from entering some program trades when the NYSE Composite Index rises or falls more than 2 percent, according to a notice sent to member firms today. The so-called collars had been in effect since 1988 and were triggered 17 times this year, according to a filing with the Securities and Exchange Commission.


more...
http://www.bloomberg.com/apps/news?pid=20601087&sid=ahZh1lKYXD8w&refer=home


I read this article yesterday, it sounds very ominous. If the market begins a steep dive, there is nothing in place to stop it from free-falling?

[ret5hd]

20. 3 possibilities (in my mind)...

1) if things REALLY started dropping, like say 10%, they would suddenly reinstate those curbs or even just shut the exchange down for a day or two.

2) some people high in the food chain decided they want to make a LOT of money in a short amount of time shorting the market.

3) both 1 & 2

[burf]

23. Or perhaps

the PPT is now running like a well oiled machine and so there is no reason for curbs.

[Hugin]

37. Oh, believe me...

If the PPT has anything to say about it, they're still there. ;)

It's just that the big-players don't like to hear they can't do -anything- with their money -anytime- they
want. It smacks of *GASP* SOCIALISM! (and maybe... REGULATION)

FREE MARKETS11!!!! TRICKLE DOWN!!1!! SUPPLY SIDE!!!1! GIMMIE!!1!!! GIMMIE!!1!! GIMMIE!11!!! MINE!!1!! MINE!!1!!
IT'S ALL MINE!!1!!

*slaps self*

*splashes self with cold water*

Ooo... I hate it when I go down that path. It's so cold and dark... :scared:

[AnneD]

46. When did the ...

PPT start water boarding...

[Buttercup McToots]

42. Dem, I asked around

answer:
Buttercup - I think what they did away with is the 'trading collars' also known as program trading curbs- on the bottom of the chart below.
The 'circuit breakers' , to deal with really big drops , are still in effect I believe.


CIRCUIT-BREAKER LEVELS
FOR FOURTH-QUARTER 2007
In the event of a 1350-POINT decline in the DJIA (10 percent):

Before 2 p.m.
1-HOUR HALT
2-2:30 p.m.
30-MIN. HALT
After 2:30 p.m.
NO HALT

--------------------------------------------------------------------------------
In the event of a 2700-POINT decline in the DJIA (20 percent):

Before 1 p.m.
2-HOUR HALT

1-2 p.m.
1-HOUR HALT
After 2 p.m.
MARKET CLOSES

--------------------------------------------------------------------------------
In the event of a 4050-POINT decline in the DJIA (30 percent), regardless of the time, MARKET CLOSES for the day.

TRADING-COLLAR LEVELS
FOR FOURTH-QUARTER 2007
In the event of a 190-POINT ADVANCE in the NYA, all index-arbitrage buy orders of the S&P 500 stocks must be stabilizing for the remainder of the day. Collar will be removed if the NYA moves back to within 90 points of the previous days close.
--------------------------------------------------------------------------------
In the event of a 190-POINT DECLINE in the NYA, all index-arbitrage sell orders of the S&P 500 stocks must be stabilizing for the remainder of the day. Collar will be removed if the NYA moves back to within 90 points of the previous days close.

Note: Effective October 1 - December 31

[DemReadingDU]

43. ok, thanks for the clarification

I guess we'll find out for sure, when the market takes it's next dive.

:hi:

[TalkingDog]

66. Got in late, but ....Crap! Do they need somebody to hold their foot still

while they take aim at it?

You know, it's like being in a car wreck; where everything slows waaaayyyyy down. And you can see that tree headed right for you, you feel the lurching sideways motion, your neck strains to keep your head upright, you hear the noise and the gravity shoving your guts around inside you. You are completely and totally aware of what is happening but you know there is not a damned thing you can do about it.

In the vast spectrum of possible futures this does not bode well.....


My Favorite Master Artist: Karen Parker GhostWoman Studios

edited for cold sloppy fingers...

[burf]

28. Does anyone know

whats up with this?

Treasury debt auction will be smallest in 7 years

WASHINGTON — The Treasury Department said today that it will sell $18 billion in debt at its quarterly auction next week, the smallest amount in more than seven years.


The government also announced that starting next year it will lower the minimum amount that can be purchased at a Treasury auction from the current $1,000 down to $100 in an effort to attract more small investors

Link: http://www.startribune.com/535/story/1519573.html

Why only $18 billion. That isn't even two months cost of the "war on terra". I don't get it.

[UpInArms]

31. here you go - the "rest" of the story

http://www.marketwatch.com/news/story/treasury-auction-18-billion-next/story.aspx?guid=%7BA9C06A65%2D1B00%2D4E6B%2DA0D7%2D1262CE754BC8%7D&dist=sp_inthis

WASHINGTON (MarketWatch) -- The Treasury Department will auction $18 billion in notes and bonds next week in its quarterly refunding auctions, the government said Wednesday.

The department will auction $13 billion in 10-year notes and $5 billion in 29-year, 6-month bonds to refund $51.5 billion in maturing securities and pay down about $33.5 billion.

The rest of the government's financing requirements will be met with weekly bills, monthly 2-year and 5-year notes and other instruments, Treasury said.

Treasury added it's likely to issue cash management bills in mid- and late November as well as early December and possibly in early January.

Treasury also said Wednesday it's lowering the minimum purchase amounts for auctions from $1,000 to $100. The department said it would consider lowering the minimum denomination for Treasury auctions from $1,000 to $100.

<snip>

"The outlook is subject to greater uncertainty than in recent quarters," the committee said.

...more at link...

emphasis mine

[burf]

39. Thanks UIA

On the story I posted at the link it originally said nothing about "uncertainty". It since has been revised. I think this auction may be veerry interesting. With the decline in the value of the dollar will it affect the number of bidders? Or to put ir another way: What if they had an auction and nobody came?

[UpInArms]

29. Check-Kiting Action: Fed doing overnight repo to add temporary reserves

http://www.reuters.com/article/bondsNews/idUSNYG00082020071031

NEW YORK, Oct 31 (Reuters) - The U.S. Federal Reserve said on Wednesday it was adding temporary reserves to the banking system through an overnight repurchase agreement.

Federal funds were trading steady at 4.81 percent in the market after the operation was announced, above the 4.75 percent target rate the Fed sets.

[Loge23]

35. "You say it, but I don't feel it"

Like a couple in a love-less marriage, the disconnect between the government and its' citizens could not be more apparent today.
Banner headlines scream "Economy grew by 3.5% in 3Q!".
Layoff notices follow.
With the credit crisis still looming large over the country and artificially high stock prices perched precariously at the cliffs of reasonability, it seems awful risky to break out the bubbly below.
The lies are becoming more and more insidious. When the truth hits the heart(land), and the country wakes up to an empty bed (and empty cupboards), the country needs to understand that the whole "happy" marriage has been a sham.

[Hugin]

38. Is that original Loge23?

If so, it's very good. :)

[Loge23]

44. Thank you

I'm inspired.
Now if I can write a good song!

[InkAddict]

47. And still we stay and fight like battered wives.

[TrogL]

53. Loonie Watch

Highlights

Current:



30-day and 90-day vs.greenback:



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




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

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

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

Current:



30-day and 90-day vs.greenback:



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




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

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

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

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

2007-09-19 Wednesday, September 19 0.985513 USD
2007-09-20 Thursday, September 20 0.998901 USD
2007-09-21 Friday, September 21 0.999201 USD
2007-09-24 Monday, September 24 0.998901 USD
2007-09-25 Tuesday, September 25 0.9995 USD
2007-09-26 Wednesday, September 26 0.99552 USD
2007-09-27 Thursday, September 27 0.99691 USD
2007-09-28 Friday, September 28 1.00412 USD
2007-10-01 Monday, October 1 1.00715 USD
2007-10-02 Tuesday, October 2 0.9998 USD
2007-10-03 Wednesday, October 3 1.00392 USD
2007-10-04 Thursday, October 4 1.002 USD
2007-10-05 Friday, October 5 1.01885 USD
2007-10-08 Monday, October 8 1.01885 USD
2007-10-09 Tuesday, October 9 1.01564 USD
2007-10-10 Wednesday, October 10 1.01906 USD
2007-10-11 Thursday, October 11 1.02627 USD
2007-10-12 Friday, October 12 1.02701 USD
2007-10-15 Monday, October 15 1.02501 USD
2007-10-16 Tuesday, October 16 1.0227 USD
2007-10-17 Wednesday, October 17 1.02712 USD
2007-10-18 Thursday, October 18 1.02743 USD
2007-10-19 Friday, October 19 1.03767 USD
2007-10-22 Monday, October 22 1.01926 USD
2007-10-23 Tuesday, October 23 1.03381 USD
2007-10-24 Wednesday, October 24 1.02987 USD
2007-10-25 Thursday, October 25 1.03381 USD
2007-10-26 Friday, October 26 1.03961 USD
2007-10-29 Monday, October 29 1.04745 USD
2007-10-30 Tuesday, October 30 1.04888 USD

Current values

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

Market         Open   High    Low   Last  Change    Pct 
CD.Y$$ Cash     1.0495 1.0532 1.0489 1.0532 +0.0042 +0.40% 
CD.Z07 Dec 2007 1.0492 1.0535 1.0481 1.0527 +0.0033 +0.31% 
CD.H08 Mar 2008 1.0520 1.0533 1.0520 1.0533 +0.0040 +0.38% 
CD.M08 Jun 2008 1.0283 1.0283 1.0247 1.0489 -0.0002 -0.02% 
CD.U08 Sep 2008 1.0498 1.0498 1.0498 1.0482 -0.0006 -0.06% 
CD.Z08 Dec 2008 1.0483 1.0483 1.0483 1.0470 -0.0013 -0.12% 
CD.H09 Mar 2009 1.0055 1.0060 1.0050 1.0453 -0.0025 -0.24% 
 

Other combinations: (http://quotes.ino.com/exchanges/?c=currencies)

Market              Open    High     Low    Last   Change     Pct 
AUSTRALIAN $/CANADIAN $ (NYBOT:AS)
AS.Z07 Dec 2007  0.87540 0.87540 0.87540 0.87385 -0.00045   -0.05%   
AUSTRALIAN $/US$ (NYBOT:AU)
AU.Z07 Dec 2007  0.9168  0.9168  0.9168  0.9168  -0.0009    -0.10%  
CANADIAN $/JAPANESE YEN (NYBOT:HY)
HY.Z07 Dec 2007 117.640 117.640 117.640 119.785  +0.190     +0.16%  
EURO/AUSTRALIAN $ (NYBOT:RA)
RA.Z07 Dec 2007 1.60350 1.60350 1.60350 1.57520  +0.00245   +0.16%  
EURO/BRITISH POUND (NYBOT:GB)
GB.Z07 Dec 2007 0.69875 0.69920 0.69850 0.69850  -0.00140   -0.20%   
EURO/CANADIAN $ (NYBOT:EP)
EP.Z07 Dec 2007 1.37490 1.37830 1.37490 1.37655  +0.00155   +0.11%  
EURO/JAPANESE YEN (NYBOT:EJ)
EJ.Z07 Dec 2007  165.75  165.97  165.75  165.97  +1.11      +0.67%   
EURO/US$ (LARGE) (NYBOT:EU)
EU.Z07 Dec 2007  1.4450                  1.4450  +0.0008    +0.06%  

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

The December Canadian Dollar was mostly steady overnight as it consolidates some of Monday's rally. Stochastics and the RSI are overbought but are bullish signaling that sideways to higher prices are possible near-term. Upside targets are hard to project if December extends this fall's rally into uncharted territory. Closes below the 20-day moving average crossing at 1.0284 would confirm that a short-term top has been posted. First resistance is Monday's high crossing at 1.0514. First support is the 10-day moving average crossing at 1.0371. Second support is the 20- day moving average at crossing at 1.0284.


Analysis

Another day, another crashing greenback. The loonie's already crossed $1.0535. If the Fed announces the rate cut as the only viable solution the greenback's woes ("that trick never works") I could easily see $1.06 by end of day. The morning drive-in guy just kinda sat there and whimpered so I don't have any other news except...

The Liberal Party has announced it's going to abstain a Canadian Government motion to drop the GST rate - again (both the rate cut and the abstaining thing). I'm so frustrated with the Liberal Party I've been trying to get ahold of Anne McLellan to convince her to come out of retirement and run for the Party leadership - she'd be a shoe-in. Failing that, I'm starting my own political party - the Born-again Communist Party. (I'll need some help on the platform).

I'm trying to get my head around this latest tax cut. It doesn't fit in Keynes - I think he'd raise it to try and settle things down a bit. It is sound c/Conservative fiscal policy (which is NOT trickle down) but I think there's something afoot. The government is awash in cash. They still haven't properly settled some land claims (one's "celebrating" 25 years with no end in sight). I'm wondering if they're gonna drop the rate, then when the economy gets back to normal, resist any attempt by the Liberals to raise it back to reasonable levels thus scuttling any attempts by Liberals to enact social programs - the old "bankrupt Congress" scheme.

We had a security guy at the office yesterday talking about counterfeiting (among other things) and pointing out all the features of Canadian currency (http://www.bankofcanada.ca/en/banknotes/). I used to work in a bank and earlier a cash office so I was aware of most of these (it's been awhile and there's been changes). I was always wondering like "why bother" when the greenback is more valuable and a lot easier to copy. Now we know.

Yesterday's drive-home talked about China and the differences between its boom compared to Japan's "rising sun" in the 70's. China isn't all about cheap (lead-filled) toys and dollar store crap. Go to any big-box store (where you can actually see the boxes -eg. Costco) and look at the appliances. Everything says "made in China". It isn't that all the components and everything else are made in China, they're manufactured elsewhere, often in Europe, then shipped to China to access its inexpensive but trained labour and shipping ports. Then it comes across the creek to Vancouver or Prince Rupert, by rail to the Port of Edmonton (I'm still having trouble with a Port without water, but the mayor won the last election based on it so who am I to talk - we've already got a Navy ship docked here (http://www.navy.forces.gc.ca/navres/units/navres_units-ships_e.asp?category=107)). There is significant "value added" by doing it through China.

The Liberal government was always doing "junkets to China", which the Conservatives considered a waste of taxpayer money. Obviously it wasn't at least in hindsight. Prime Minister Harper's treading on thin ice (Great White North joke) at the moment because he invited the Dalai Lama to speak, pissing of China who considers him a separatist (another Canadian issue). We're probably on safer ground than Dubya (who did the same thing). What happens when China calls in its markers?

[TrogL]

57. $1.0539

http://quotes.ino.com/chart/?s=CME_CD.Z07&v=s

Last trade 1.0513 Change +0.0019 (+0.18%)

Open 1.0492 Previous Close 1.0490

High 1.0539 Low 1.0481

[TrogL]

68. Oh, Lord, what happened?

Market          Open     High    Low   Last  Change   Pct Time 
CD.Y$$ Cash     1.0495 1.0573 1.0489 1.0573 +0.0083 +0.79% 15:01 
CD.Z07 Dec 2007 1.0492 1.0573 1.0480 1.0571 +0.0077 +0.73% set 14:59 
CD.H08 Mar 2008 1.0520 1.0550 1.0520 1.0571 +0.0078 +0.74% set 14:33 
CD.M08 Jun 2008 1.0283 1.0283 1.0247 1.0569 +0.0080 +0.76% set 15:08 
CD.U08 Sep 2008 1.0498 1.0498 1.0498 1.0566 +0.0084 +0.80% set 15:08 
CD.Z08 Dec 2008 1.0483 1.0483 1.0483 1.0561 +0.0091 +0.87% set 15:08 
CD.H09 Mar 2009 1.0055 1.0060 1.0050 1.0556 +0.0103 +0.99% set 15:08 

[UpInArms]

70. Canada dollar hits highest level since late 1800s

http://www.reuters.com/article/bondsNews/idUSN3145647820071031

TORONTO, Oct 31 (Reuters) - The Canadian dollar raced to
its highest level since the late 1800s against the U.S.
currency on Wednesday, thanks to lofty oil prices and a weak
greenback after the U.S. Federal Reserve cut interest rates.

Domestic bond prices ended lower as economic data from both
Canada and the United States topped expectations while the Fed
signaled it may be done with rate cuts.

The Canadian dollar closed at US$1.0585, making a U.S.
dollar worth 94.47 Canadian cents, up from Tuesday's close of
US$1.0492, or 95.31 Canadian cents.

Shortly after the North American session ended, the red-hot
Canadian currency hit US$1.0617, or 94.19 Canadian cents, which
some market experts consider an all-time high, given the
drastic change in market conditions since the 1800s.

A publication called "A History of the Canadian dollar" is
published on the Bank of Canada's Web site at
http://www.bankofcanada.ca/en/dollar_book/ and shows the
Canadian dollar was valued at US$2.78 in the late 1800s.

"A good part of the move has just been related to the usual
suspects," said George Davis, chief technical strategist at RBC
Capital Markets. "Broad-based U.S. dollar weakness ahead of the
FOMC helped the Canadian dollar ... and obviously we also saw
commodity prices do very well today."

...more...

[Hugin]

62. ~15:00 EST: And they're off!

Index Last Change % change
• DJIA 13937.41 +144.94 +1.05%
• NASDAQ 2858.13 +41.42 +1.47%
• S&P 500 1549.28 +18.26 +1.19%

[specimenfred1984]

63. Want to see what our manipulated markets look like?

Look at today's S&P 500:

http://finance.yahoo.com/q/bc?s=%5EGSPC&t=1d

[Hugin]

64. I noticed that 'dip&spike' in all of them...

Very vivid.

[JNelson6563]

67. Holy cow! Gold and oil!

Amazing.

As shown in the OP, when Little Boots took office in January of 2001 oil was: Oil - $27.69/bbl.

The CNBC talking heads are probably slathering themselves in the stuff as I type. <gag>

Julie

[UpInArms]

69. the end - my friends - of a very long day

Dow 13,930.01 137.54 (1.00%)
Nasdaq 2,859.12 42.41 (1.51%)
S&P 500 1,549.38 18.36 (1.20%)
10-Yr Bond 4.475% 0.092

NYSE Volume 3,958,099,750
Nasdaq Volume 2,596,811,500

4:25 pm : Stock market bulls did their thing again on Wednesday, driving the indices higher on encouraging economic news, a batch of reassuring earnings results, and a decision by the Federal Open Market Committee to cut the fed funds and discount rates by 25 basis points each to 4.50 percent and 5.00 percent, respectively.

The FOMC decision wasn't heard until 2:15 pm ET. Prior to that, the market traded with a bullish bias, supported by the government's advanced report that third quarter GDP grew at an annualized rate of 3.9%.

The third quarter growth was remarkable when taking into account the subprime fallout, the housing industry downturn, and credit market crisis that highlighted the July to September period. Residential construction, in fact, took a full 1.1 percent off GDP growth. Offsetting gains, though, in consumer spending, business investment, government spending, inventories, net exports and nonresidential construction kept the U.S. economy on a noteworthy growth trajectory.

While fourth quarter GDP is expected by Briefing.com to slow to a pace closer to 1.5 percent to 2.0 percent, the market still walked away from the third quarter GDP report with a sense of comfort that consumer spending and business investment are solid enough to keep the economy out of recession.

The latter consideration, combined with reassuring earnings results and/or guidance from the likes of Mastercard (MA 189.91, +32.76), Transocean (RIG 119.37, +4.50), Clorox (CLX 62.57, +1.57), Kraft (KFT 33.41, +0.81) and Weyerhauser (WY 75.91, +1.60), put the market on a bullish course to begin the session.

Once again, stocks traded higher in the face of a spike in oil prices that followed another government report that showed a surprising 3.89 million barrel decline in crude stockpiles versus the market's expectation for a build of 400,000 barrels. Crude for december delivery, which dropped 3.4% on Tuesday after Goldman Sachs said to take profits, surged 4.6% to $94.53 per barrel on supply concerns entering the winter heating season.

The boost in crude prices gave a hefty lift to the energy sector (+1.8%) which was one of Wednesday's best-performing areas. It was the materials sector (+2.5%) that led all comers as strong earnings results from companies like Weyerhauser and Newmont Mining (NEM 50.90, +4.46), and a weak dollar, drove buying interest in the stocks of companies that stand to benefit from rising commodity prices.

The dollar index slipped 0.4% to 76.479 in the wake of the Fed's decision to cut interest rates.

In typical fashion, the FOMC decision led to some volatile trading shortly after the decision crossed the wires at 2:15 pm ET. Just prior to the release, the Dow, Nasdaq and S&P were up 53, 16 and 8 points, respectively. Within minutes of the FOMC's announcement, though, they were all showing slight losses.

The knee-jerk selling interest occurred in response to a directive from the FOMC that implied the rate-setting committee is reluctant to cut rates again. That understanding was driven by three items in particular: (1) the committee judging the upside risks to inflation roughly balance the downside risks to growth (2) the acknowledgment that recent increases in energy and commodity prices may put renewed upward pressure on inflation and (3) the indication that Kansas City Fed President Hoenig voted against a rate cut, saying he preferred no change in the fed funds rate.

With added time to examine the statement, the stock market got back into rally-mode driven by the takeaway that the FOMC might be reluctant to cut rates right now, but that it would ultimately do so if need be.

Fittingly, the financial sector (+0.8%) played an influential part in driving the late-afternoon rally effort, yet it still underperformed the broader market in Wednesday's trading.

All ten economic sectors closed with a gain. The technology sector (+1.7%), paced by ongoing strength in big-cap leaders like Google (GOOG 707.00, +12.23) and Microsoft (MSFT 36.81, +1.24), maintained its leadership role.

The Treasury market, meanwhile, was knocked on its heels by the stock market rally and the Fed's talk about the potential for renewed upward pressures on inflation. The 10-year note slipped 21 ticks, bringing its yield up to 4.46%.CRB +2.0% DJ30 +137.54 NASDAQ +42.41 NQ100 +1.4% R2K +1.5% SP400 +1.7% SP500 +18.36 NASDAQ Dec/Adv/Vol 1011/1999/2.52 bln NYSE Dec/Adv/Vol 882/2375/1.39 bln

3:30 pm : The market is now backtracking off its highs as volatility continues. The major indices are still trading with decent gains, and are above pre-FOMC announcement levels.

The dollar moved to its session lows following the FOMC decision, which spurred additional buying interest in the materials sector (+2.0%). Additionally, gold prices have moved back near its intraday high.

Commodities in general have done well this session, with the rally in crude prices driving a 2.0% gain in the CRB Index. DJ30 +85.11 NASDAQ +24.94 SP500 +10.25 NASDAQ Dec/Adv/Vol 1035/1931/2.0 bln NYSE Dec/Adv/Vol 914/2304/1.03 bln

[Ghost Dog]

71. European stocks index in biggest drop in 8 weeks (so who's surprised?)

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20071101:MTFH94675_2007-11-01_16-39-59_L0145803&type=comktNews&rpc=44

LONDON, Nov 1 (Reuters) - European shares suffered their biggest one-day percentage fall in eight weeks on Thursday, driven by declines in banks as renewed worries about the fragile health of financials spooked global markets.

UBS (UBSN.VX: Quote, Profile , Research), HSBC (HSBA.L: Quote, Profile , Research), BNP Paribas (BNPP.PA: Quote, Profile , Research) and Barclays (BARC.L: Quote, Profile , Research) all fell between 2.7 percent and 5.4 percent.

The sharp fall erased the previous day's gains made in U.S. stocks when the Fed cut interest rates, and knocked markets perched at two-week highs.

The pan-European FTSEurofirst 300 index <.FTEU3> ended down 1.6 percent at a provisional 1,570.9, its lowest close since October 25, and its biggest daily percentage drop since September 7. The index however ended above the day's lows.

"The risk remains that economies don't slow down and therefore interest rates have to go back up and bond yields go higher," said Max King, global strategist at Investec Asset Management.

"We have seen plenty of chatter about economic slowdown but no real hard evidence in the U.S. or anywhere else. That means the bond market is taking a lot for granted and that worries us."

The FTSEurofirst is still up 6 percent so far this year but short of the 14 percent gain it made by this time last year.

/...