STOCK MARKET WATCH, Monday May 27

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday May 27, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 239
DAYS SINCE DEMOCRACY DIED (12/12/00) 2683 DAYS
WHERE'S OSAMA BIN-LADEN? 2408 DAYS
DAYS SINCE ENRON COLLAPSE = 2699
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 May 23, 2008

Dow... 12,479.63 -145.99 (-1.16%)
Nasdaq... 2,444.67 -19.91 (-0.81%)
S&P 500... 1,375.93 -18.42 (-1.32%)
Gold future... 925.80 +7.50 (+0.81%)
30-Year Bond 4.56% -0.07 (-1.56%)
10-Yr Bond... 3.83% -0.09 (-2.30%)






GOLD,EURO, YEN, Loonie and Silver

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PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp: Cool, Clear Water

BY BRIAN PRETTI

Our Spirits Cry Out For Water

Critical to US households ahead, in my mind, is liquidity. Just as this issue is now life or death for the commercial and investment banks. Although the Street appears myopically focused on this very issue when it comes to the Fed, the US financial system and its key players, they should be equally as focused on US households when it comes to the question of liquidity. Yes, the very households that have made the quarter century US credit cycle literally hum…until recently. So let’s have a look at household liquidity circumstances of the moment. You already know, a lot of charts to come that in very good measure tell their own story quite simply and elegantly.

First a very important reminder. Liquidity, or cash, in the charts below is comprised of all cash, bank deposits, CD’s, money funds and all bond holdings (Treasury, agency, corporate and muni) of these very same households. I try to be as generous and all inclusive as possible with the definition of household liquidity. Narrow it is not. About the only things not included in the definition of liquidity, or cash, in the charts that follow are household ownership of real estate, equity holdings (including pensions) and private business equity. Otherwise I’m pretty much throwing the kitchen sink into the mix of so-called liquidity just to give households a big benefit of the doubt. Onward.

.....

When the going gets tough in the US economy, the tough go shopping. Don’t they? At least that’s been the modus operandi of US households for some time now. Below is a picture of the resilient US consumer at work. Hmmm. Seems there’s been a bit of an acceleration in this little measure since the boomers came of age in the early 1980’s and started receiving at least five credit card and mortgage solicitation offers in the mail each and every day. Of course the real angle of ascent was saved for the current decade. C’mon, nothing a bailout or two can’t fix to help get households moving back on the road north in terms of liability expansion relative to income, right?

.....

So as we look ahead, THE big question becomes, will US households act to increase their liquidity (savings) circumstances? If so, there certainly will be a tradeoff somewhere in the savings versus consumption or investment alternative choices. Point blank, history tells us that equities have fared best in declining aggregate savings rate environments. At a recent reading of 0.3%, just how much lower is the US savings rate going from here? Again, more importantly, the real issue is forward household choices regarding increasing liquidity (savings) that will indeed have a real bearing on financial market and economic outcomes. While investors are currently worried about financial sector liquidity, I remind you to please remain focused on household liquidity circumstances as being at least equal to, if not greater in importance than financial sector character.

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

[ozymandius]

2. Today's Reports

10:00 Consumer Confidence May
Briefing.com 61.0
Consensus 61.0
Prior 62.3

10:00 New Home Sales Apr
Briefing.com 515K
Consensus 520K
Prior 526K

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

[ozymandius]

9. Sales of New Houses, Consumer Confidence in U.S. Probably Fell

May 27 (Bloomberg) -- New-home sales in the U.S. probably fell to a 17-year low and consumer confidence sank, signs the housing slump is dragging down the economy, economists said before reports today.

Purchases of new homes dropped 1.1 percent in April to an annual pace of 520,000, the fewest since September 1991, according to the median forecast in a Bloomberg News survey. A separate report may show a measure of consumer confidence fell this month to the lowest since 1993.

Concern about declining home values and stricter loan rules are limiting demand and foreclosures throw even more properties on the market. Federal Reserve policy makers view the prospect of larger decreases in house prices and the effect that would have on financial institutions as a ``key source'' of risk to growth.

.....

A report from S&P/Case-Shiller at 9:00 a.m. may show house prices in 20 U.S. metropolitan areas plunged 14.2 percent in March from a year earlier, the most since records were first published in 2001, the Bloomberg survey showed.

The housing downturn and strains on the consumer led Fed policy makers last month to cut their 2008 growth estimate by almost 1 percentage point.

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

[UpInArms]

42. pril new-home sales weakest in 26 years yr-on-yr - May consumer confidence at 16-year low

08. U.S. April new-home sales weakest in 26 years yr-on-yr
10:00 AM ET, May 27, 2008

09. U.S. April new-home sales down 42% year-on-year
10:00 AM ET, May 27, 2008

10. U.S. April new-home sales first rise in six months
10:00 AM ET, May 27, 2008

16. U.S. April new-home sales up 3.3% to 526,000 pace
10:00 AM ET, May 27, 2008

17. U.S. May consumer confidence below 59.5 expected
10:00 AM ET, May 27, 2008

18. U.S. May consumer confidence at 16-year low
10:00 AM ET, May 27, 2008

19. U.S. May consumer confidence 57.2 vs 62.8 in April
10:00 AM ET, May 27, 2008

[ozymandius]

3. Oil prices steady above $133 a barrel

BANGKOK, Thailand - Oil held steady above $133 a barrel Tuesday in Asia on worries about global petroleum supplies and the outlook for the dollar.

Reports of an attack by militants on an oil pipeline in Nigeria, one of Africa's largest oil exporters, also supposed prices.

Midafternoon in Singapore, light, sweet crude for July delivery was up 95 cents from Friday at $133.14 a barrel in electronic trade on the New York Mercantile Exchange.

Nymex floor trading was closed Monday for Memorial Day in the U.S., and electronic trading levels were little changed from the day before during Asian hours. Monday was also a bank holiday in Britain, and trading volumes were lower than usual.

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

[ozymandius]

4. Nigeria attacks boost oil price

US light, sweet crude gained $1.27 cents to reach $133.46, while London Brent added $1.23 to $132.80.

It has been a volatile few sessions for US crude, which peaked at $135.09 on Thursday before falling back to $130.81 in a rush of profit-taking.

Oil prices have doubled in the past year, lifted by supply fears, a weak US dollar and speculators.

Supply fears have been exacerbated by claims from a Nigerian anti-government group, the Movement for the Emancipation of the Niger Delta, said it had sabotaged a Royal Dutch Shell pipeline.

http://news.bbc.co.uk/2/hi/business/7420042.stm

[ozymandius]

7. Small business crunched by fuel prices

FORT WORTH, Texas (Reuters) - Many U.S. small business owners say soaring fuel costs are eating their profits at a time when the economy is already weak, making them more cautious about expanding or hiring.

.....

SOS has 70 employees and 2007 revenue of $16 million.

But Puente said his freight costs have gone up as the companies hauling his office machines apply fuel surcharges.

SOS has also just had to raise the amount of gasoline it pays employees for driving to visit clients to 42 cents from 36 cents per mile (1.6 km), at a cost $3,000 a month.

.....

The answer from many small businesses is that, like SOS, they can only pass on a portion of high fuel costs to customers. So expansion plans are shelved and they are focused on getting more out of current employees, not taking more on.

http://news.yahoo.com/s/nm/20080526/us_nm/fuels_smallbusiness_dc

[UpInArms]

19. Small business sentiment still shaky: poll

http://news.yahoo.com/s/nm/20080527/bs_nm/usa_economy_smallbusiness_dc

NEW YORK (Reuters) - The majority of small business owners think the U.S. economy is getting worse, though sentiment showed some improvement in May from its recent lows, according to a survey released on Tuesday.

The survey reflects the U.S. economy's struggles with the worst housing slump since the Depression, soaring energy costs and a shrinking job market, although the numbers did show improvement in some areas.

Credit-card provider Discover's Small Business Watch index of confidence rose to 81.8 in May from 76.1 in April. April's was the lowest reading since the monthly survey's launch in August 2006.

According to the report, only 28 percent of business owners said that economic conditions were improving for their businesses, though this was an increase from 24 percent in April.

...more...

[ozymandius]

10. Tillerson to Face Rockefellers, Nuns in Exxon Meeting Showdown

May 27 (Bloomberg) -- Exxon Mobil Corp., the world's largest company by market value, is taking on nuns, pension funds and heirs to its founder in battles over global warming and the power of its chief executive officer.

The biggest U.S. oil producer is urging investors at Exxon Mobil's annual shareholders meeting tomorrow in Dallas to vote against a resolution that would bar its CEO from serving as chairman. Supporters of the measure, including the California Public Employees' Retirement System and descendants of founder John D. Rockefeller, want an independent chairman to work faster to combat climate change.

CEO Rex Tillerson, who led Irving, Texas-based Exxon Mobil to a record $40.6 billion profit last year as crude prices jumped 57 percent, should spend more on oil alternatives, said Peter O'Neill, great-great-grandson of Rockefeller. The proposal to split the leadership roles was supported by 40 percent of shareholders last year, up from 34.3 percent in 2006.

.....

O'Neill said he met with Exxon executives in the past two years to discuss petroleum alternatives. Citing a confidentiality agreement, O'Neill declined to disclose details such as research budgets or what type of alternative fuels the company is pursuing. Alan Jeffers, an Exxon spokesman, said the company regularly confers with shareholders and doesn't comment on individual meetings.

http://www.bloomberg.com/apps/news?pid=20601103&refer=us&sid=aUHNmQ9ZCUz0

[ozymandius]

13. Soros: Skyrocketing Oil Prices a Bubble (the spirit of Enron lives on)

Veteran investor George Soros, in an interview with the Telegraph, describes speculation as a significant factor in the recent spike in oil prices. However, he doesn't expect prices to break until there are signs of economic weakening. Later in the post, I'll provide some information that suggests how traditional supply/demand forces could have been swamped by the volume of futures trading.

First, from the Telegraph:

Speculators are largely responsible for driving crude prices to their peaks in recent weeks and the record oil price now looks like a bubble, George Soros has warned....

In an interview with The Daily Telegraph, Mr Soros said that although the weak dollar, ebbing Middle Eastern supply and record Chinese demand could explain some of the increase in energy prices, the crude oil market had been significantly affected by speculation.

"Speculation... is increasingly affecting the price," he said. "The price has this parabolic shape which is characteristic of bubbles," he said.

.....

Mr Soros also warned that the Bank's inflation report represents a "Faustian pact", obliging it to keep interest rates high to control inflation, even as the economy is starting to slump.

There are two arguments made against the speculation thesis. One is arbitrage: if oil was too high, someone would go short the future and buy oil in the cash market cheaper, and earn the arbitrage profit.

The problem with that logic is that price discovery happens in the futures markets; there isn't another venue for setting the price and thus arbitraging it against futures. Worse, a substantial amount of that trading is either over the counter (hence not reported to US futures regulators) or on the ICE exchange in London (ditto).

The two most important visible markets are NYMEX and ICE, and far and away the two most important types of crude (in terms of price discovery and setting global prices) are West Texas Intermediate and North Sea Brent. A June 2006 US Senate Permanent Subcommittee on Investigations report on “The Role of Market Speculation in rising oil and gas prices,” found:

…there is substantial evidence supporting the conclusion that the large amount of speculation in the current market has significantly increased prices....

Until recently, US energy futures were traded exclusively on regulated exchanges within the United States, like the NYMEX, which are subject to extensive oversight by the CFTC, including ongoing monitoring to detect and prevent price manipulation or fraud. In recent years, however, there has been a tremendous growth in the trading of contracts that look and are structured just like futures contracts, but which are traded on unregulated OTC electronic markets. Because of their similarity to futures contracts they are often called “futures look-alikes.”

The only practical difference between futures look-alike contracts and futures contracts is that the look-alikes are traded in unregulated markets whereas futures are traded on regulated exchanges. The trading of energy commodities by large firms on OTC electronic exchanges was exempted from CFTC oversight by a provision inserted at the behest of Enron ....

http://www.nakedcapitalism.com/2008/05/soros-skyrocketing-oil-prices-bubble.html

[UpInArms]

22. Driving in the US becomes a luxury

http://www.ft.com/cms/s/0/917946e0-282b-11dd-8f1e-000077b07658.html?nclick_check=1

When Cynthia Miller moved to Houston at the start of the year, she planned to make the 260-mile drive back to visit friends and family in Baton Rouge once every three weeks. But with petrol prices approaching $4 a gallon, such a trip is now a luxury.

“I really was hesitant about going home for Easter,” said Ms Miller, an assistant account executive at Hill and Knowlton, the public relations consultancy.

She is not alone in feeling pressured by energy prices that have soared in recent years. With prices at the pump having more than doubled since 2000, Americans are not only thinking about how much it costs to fill their tanks but doing their best to cut consumption.

<snip>

The share of US consumer spending going on petrol was 4.2 per cent for the first quarter of 2008 – the highest since 1985, said Christian Weller, associate professor in the Department of Public Policy and Public Affairs at the University of Massachusetts.

He said that with a savings rate already close to zero and total household credit relative to disposable income the highest since tracking began in 1952, Americans may not have much more money to put toward energy. “This is the lowest savings rate since the Great Depression. People are hurting,” said Mr Weller.

...more...

[DemReadingDU]

35. As gas goes up, driving goes down

5/26/08 At a time when gas prices are at an all-time high, Americans have curtailed their driving at a historic rate.

The Department of Transportation said figures from March show the steepest decrease in driving ever recorded.

Compared with March a year earlier, Americans drove an estimated 4.3 percent less -- that's 11 billion fewer miles, the DOT's Federal Highway Administration said Monday, calling it "the sharpest yearly drop for any month in FHWA history." Records have been kept since 1942.

According to AAA, for the first time since 2002, Americans said they were planning to drive less over the Memorial Day weekend than they did the year before.

Tracy and Adam Crews posted on iReport that their annual Memorial Day weekend has traditionally involved camping and fishing.

"Well, due to the continual rise in gas, we felt our only recourse was to nix the idea this year and stay home" in Jacksonville, Florida, they wrote.

more...
http://www.cnn.com/2008/US/05/26/gas.driving/index.html

[DemReadingDU]

36. U.S. Vehicle Miles vs. Real Gasoline Price

by Calculated Risk...

Yesterday the Department of Transportation reported that Americans drove 11 billion fewer miles in March '08 than in March '07. I presented a graph of the moving 12 month total miles driven here.

The following graph compares the year-over-year change in the moving 12 month total vs. the real price of gasoline (source for real prices: EIA). Note: graph uses annual data for real prices prior to 1980.

This is only the third time since 1970 that the YoY change in total U.S. miles driven has declined. The previous two times were following the oil shocks of 1973 and 1979 - and led to the two most severe U.S. recessions since WWII.

Note that the most recent data from the DOT is for March. According to the EIA, gasoline prices have risen 13% since then! So I'd expect U.S. miles driven to have declined further in April and May.

more...
http://calculatedrisk.blogspot.com/2008/05/us-vehicle-miles-vs-real-gasoline-price.html

[UpInArms]

29. Record gas prices: 20 straight days: Price for gas tops $4 a gallon in 11 states and Washington, D.C

http://money.cnn.com/2008/05/27/news/economy/gas_prices/index.htm

NEW YORK (CNNMoney.com) -- Retail gas prices hit record highs for the 20th day in a row, motorist group AAA's Web site showed Tuesday.

The nationwide average for a gallon of regular unleaded rose to $3.937, up slightly from $3.936 the previous day.

The climb in gas prices, which have steadily risen over the past three weeks, comes amid the start of the summer driving season, which unofficially kicked off over the Memorial Day weekend.

The AAA survey shows gas prices are up about 9% from a month ago and nearly 23% higher from year-ago levels. The average price for gas has passed the $4 a gallon mark in 11 states, as well as in Washington, D.C.

The most expensive state for buying gas is Alaska, where a gallon of regular unleaded costs an average of $4.201. The second most expensive state is Connecticut, where a gallon of gas costs $4.196, according to AAA.

The least expensive state for purchasing gas is Wyoming, where a gallon costs $3.751 a gallon on average. The second least expensive state for gas is Missouri, where a gallon runs $3.753 a gallon.

...more...

[ozymandius]

5. Futures point to mixed open on Wall Street

PARIS (Reuters) - Stock futures pointed to a mixed open on Wall Street on Tuesday as investors, rattled by record high oil prices last week, remained cautious ahead of key macroeconomic data.

By 5:57 a.m. EDT, June Dow Jones futures were down 0.07 percent, while Standard & Poor's 500 futures were flat and Nasdaq futures were up 0.2 percent.

U.S. stock markets were closed on Monday for the Memorial Day holiday.

Investors will comb through U.S. consumer confidence data for May as well as U.S. new home sales data for April, both expected at 10 a.m., for evidence of the strength of the economy.

Economists in a Reuters survey expect a reading of consumer confidence of 60.0, compared with 62.3 in April, and they forecast a total of 520,000 annualized house units sold, versus 526,000 in March.

The market will also keep an eye on the Case-Shiller home price index for March. Economists expect a 2.0 percent fall versus a 2.6 percent decline in February.

http://news.yahoo.com/s/nm/20080527/bs_nm/markets_stocks_dc

[ozymandius]

6. Borders returns to Web retailing after 7 years

DETROIT - Borders Group is jumping back into online retailing with a Web site designed to evoke the feeling of browsing at a neighborhood bookstore, down to the popular shelves of staff picks that are familiar to its customers nationwide.

But after seven years paired with Amazon.com, analysts say it will be a challenge for the new Borders.com to step out of the shadow of the Web retailing giant.

"It's not the intent that we're going to out-Amazon Amazon at what they do," Borders Group Inc. President and CEO George Jones said earlier this year. "What we think is that we can still have a great, compelling offering."

Tuesday's launch of the site comes more than two months after Borders announced it may put itself up for sale. Just last week, Barnes & Noble Inc. confirmed it put together a team to study the feasibility of a deal. But Jones says pushing forward with Borders' return to Web retailing is key — regardless of whether a sale materializes.

The centerpiece of the site is "The Magic Shelf." In addition to sections for new books, CDs and DVDs, it also includes staff picks and a "Picked For You" section of personalized recommendations.

http://news.yahoo.com/s/ap/20080527/ap_on_re_us/borders_goes_online

[ozymandius]

8. SABMiller Rises as FT Says InBev Considering Merger (Update1)

May 27 (Bloomberg) -- SABMiller Plc, the world's third- largest brewer, rose the most since 2005 in London trading after the Financial Times reported InBev NV is weighing a merger between the companies.

SABMiller rose as much as 8.2 percent. Leuven, Belgium- based InBev, the world's biggest brewer by sales, is considering an SABMiller deal as a ``plan B'' should its potential $46 billion approach to Anheuser-Busch Cos. fail, the FT said on May 24, citing an unidentified person familiar with the situation.

InBev, which in 2005 bought control of Brazil's Cia. de Bebidas das Americas for $11.2 billion, generates less than 1 percent of its total volume in the U.S. Last year, London-based SABMiller agreed to merge its Miller business in the world's biggest economy with the local unit of Molson Coors Brewing Co. to revive sales.

http://www.bloomberg.com/apps/news?pid=20601102&sid=aMozZ2ArByeo&refer=uk

[ozymandius]

11. Corn Costs Signal Biggest Beef Surge Since 2003 as Herds Shrink

May 27 (Bloomberg) -- Enjoy your next steak, because prices from Shanghai to San Francisco are only going up.

The highest corn prices since at least the Civil War, based on Chicago Board of Trade data, mean U.S. feedlots are losing money on every animal they sell, discouraging production as rising global incomes increase meat consumption and a declining dollar spurs exports. Cattle may rise 13 percent by the end of the year on the Chicago Mercantile Exchange and Brazil's Bolsa de Mercadorias e Futuros, futures contracts show.

Not since 1996, when corn reached what was then a record $5 a bushel, have cattle been this cheap relative to their primary source of feed. Cattle are the seventh-worst performer of the 26-member UBS Bloomberg Constant Maturity Commodity Index in the past year, a time when soybeans, oil and copper jumped to records. After adjusting for inflation, cattle are down 27 percent from their 1988 peak.

.....

The beef rally risks accelerating global food inflation, which has sparked riots from Haiti to Egypt. In the U.S., food prices will jump 5.5 percent this year, the fastest pace since 1989, according to the U.S. Department of Agriculture.

.....

Wholesale choice-grade beef in the U.S., the world's biggest producer and consumer, will rise 16 percent to a record average of $1.86 a pound next year, the biggest gain since 2003 and the second-largest since 1979, said Len Steiner, a principal at Manchester, New Hampshire-based Steiner Consulting Group, which provides research to the food industry.

http://www.bloomberg.com/apps/news?pid=20601103&sid=axIrowbBQ7fo&refer=us

[ozymandius]

12. Lehman, Morgan Stanley Estimates Cut by Bank of America's Hecht

May 27 (Bloomberg) -- Lehman Brothers Holdings Inc., Morgan Stanley and Goldman Sachs Group Inc. had their second-quarter profit estimates cut by Bank of America Corp. analysts, who cited slowing economic growth and the risk of further asset writedowns.

Analysts led by Michael Hecht, in a report to clients today, lowered their estimate for New York-based Lehman to a loss of 50 cents a share from a previous prediction of 76 cents in earnings. Morgan Stanley was reduced to 95 cents from $1.40, and Goldman was trimmed to $3.45 a share from $3.75. For all three banks, the fiscal second quarter ends this week.

Lehman, the largest underwriter of mortgage bonds before the subprime market collapsed, has been the laggard of Wall Street this year as it struggles to shed its portfolio of assets related to home loans and convince investors that writedowns so far have been as realistic as its peers. The value of the assets of the large U.S. investment banks is about 20 percent lower than what is stated on their balance sheets, the Bank of America report said.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aV1fbd10roq8&refer=news

---

You may recall discussions about Lehman becoming the next to go the way of Bear Stearns.

[UpInArms]

21. Lehman Brothers' dark pools swell

http://us.ft.com/ftgateway/superpage.ft?news_id=fto052620081631541651&referrer_id=yahoofinance

Lehman Brothers (NYSE:LEH) has added Japanese stocks to its platform that offers direct access to so-called dark liquidity pools, the private facilities that are used to trade shares away from exchanges.

The move by Lehman, announced on Tuesday, further ratchets up the challenge to established exchanges. Investors, such as hedge funds, are attracted to dark pools because the trading anonymity they provide reduces the danger of a stock moving against their interests as an order is executed.

Rival investment banks, including Goldman Sachs, UBS and Credit Suisse, have their own versions of the platforms operating in Japan. Introduction of the technology in Asia has been slower than the US and Europe, partly because the markets are more fragmented, with differing regulations, languages and trading specifics.

Nevertheless, accessing dark pools is becoming increasingly popular in the region. Lehman plans to launch its LX platform in Asia (ex-Japan) this year, while Goldman Sachs said it "plans to consider" the roll-out of its Sigma-X platform across Asia.

"If you have a client that trades many markets in Asia, it's not good enough that they can get Japan and Hong Kong, they need access to all of the markets," Anthony Brooker, head of electronic trading sales for Asia at Lehman, told the Financial Times.

...more...

[ozymandius]

14. Back in a few hours.

:donut: :donut: :donut:
I'm going to do my bit to shore up the sagging economy. A purchase of bagels and coffee should do the trick.

Ozymandius :hi:

[AnneD]

39. Morning Marketeers....

:donut: and lurkers. Ozy, don't forget the cream cheese-what's the point of a bagel without 'da schmear'.

I hope everyone had a pleasant Memorial Day. I encountered a bit of global warming-I got a sunburn. I was talking to some folks at the pool that were from Pa. As the conversation went on I asked them what city they were from and they replied Gettysburg. I meant to say that I had never meet anyone from Gettysburg but it came out "I've never met anyone with a Gettysburg Address". :blush: Guess that is part and parcel for being a history buff or maybe it was mentalpause.

The roads were fairly clear here in Houston but I here it was crowded at destination sites like Galveston and other beach sites. I spent a bit in the local store-getting some summer things like a new solar tea jar, charcoal, some platters. We had some wonderful fresh roasted corn, roasted seasoned new potatoes, and I roasted some peppers from my little plants. Hubby ate some chicken (a rarity considering he is Hindu). Heck, I even splurged and had a small steak (my fav). And we had a few wine coolers too. I think we will bbq more this year. We had a nice quite day, hot but quite.

Even though we have high prices on gas now (and some competition from other countries...I think that gas will dip down again, possibly next year. I am basing it on what happened the last time we had a RE bust, S&L scandal, and Oil Embargo. That totally sapped Houston's economy. I think many of us old timers remember that and this is why you have folks hanging on to their money and their jobs now. We are going to accelerate our debt repayment starting next month and should be debt free within at least 2 years. If either of us are terminated now, it will be a forced early retirement and we have jobs in the wings as it were. We can handle that.

Hubby is again practicing sitar and will start recording again. His arm has healed well. Would you belief we STILL haven't gotten a settlement for that car crash. I will make a nuisance of my self this summer (squeaky wheel and all) and see if we can't get it resolved. Hubby is also wanting to see his sitar guru in India for some advanced techniques classes. His guru is getting old and his sons are not interested so he wants hubby to visit him for about six months of classes. Hubby wants to tour afterwords in Europe. I want to join him for that so I predict some traveling in my future. I can't wait, but the time will fly by I am sure.

Happy hunting and watch out for the bears.

[TalkingDog]

15. News from the trenches: The Litter Index

I hope everybody had a wonderful, productive weekend. I'm out and about today and will check in later. But first....

Last week couple of folks on the board were talking about being tourist spots and vacation places and the forced quality of their visitors.

Well, we're too far into the middle of dairy cows, chicken houses and corn/soybean production to be able to tell much about tourists who have the means to travel. What we do have, however, is the Litter Index.

We live, bordered on three sides by various bodies of water. The broad creek in the valley behind us, the river 1/2 mile away at the foot of a very steep hill and the man-made lake across the road and down the hill.

When warm weather arrives in mid to late April, the "Spring Colors" blossom along the roadside leading to the dam, a popular fishing spot. There are the bright oranges and yellows of the Slim Jim packages, the contrasting blue ribbon against the subtle orange of the Lance cheese crackers. And the stained glass effect of light bouncing off of beer cans from the lower end of the price scale, plastic soda bottles and your various and sundry hygiene products, napkins and the occasional used condom. (Hey, at least they're using them). At points we have carried 4 stuffed full t-shirt grocery bags full of recyclables and trash (no, we leave underwear, condoms and hygiene products where they lay...they decompose fairly rapidly)

While some of the "food product" wrappers are found along the road as we walk the dogs on our evening pram, the vast majority of the litter is found at the crest of the hill next to the transformer station which shunts power from the hydroelectric dam to the large towers that run through the valley at the very back of our property.

Perhaps poetically at this juncture of nature and raw power constrained only by ineffective warning signs, is a popular teen/young adult hangout. Illegal, of course, since it trespasses on Duke Power property. And forbidden, not only for that reason, but for the fact that every year there is at least one major fire started from a careless match, a burning cigarette or a "camp fire". Last year, there were 2.

Every warm day from early spring until late fall, there are cars and trucks, the occasional motorcycle parked at the top of the hill. Usually one or two, but once in a while the group will amass to 10 or 15 vehicles.

When it gets above 5 or so, we put a bug in the sheriff's ear. Not to be old and adult, but because we are merely 1/4 mile down the road with huge stands of sappy pines, drought riddled woods and dead woodland detritus between us and ashes.

Well, the colors began late this year. The cold Spring was a factor. But even after it warmed up, we have noticed the volume was much lower than normal. And no daily line of after school transport parked at the top of the hill for an illicit dip in the cool lake, before heading home for supperr.

On the weekends the Hmong and the Hispanic populations join the WASPs and good old boys who like to fish at the foot of the dam. Fishing. The great equalizer. No fights, no accusations, no politics.

This vacation weekend, no Hmong. No Hispanics. A few WASPs and fewer good old boys. Those who couldn't afford gas stayed home. Those who could didn't buy as many snacks to litter the roadway with.

Over the weekend I caught the sound of exactly one jet ski on the lake. Usually its non-stop motorized action on a beautiful, hot beginning to summer. For the first time since we've lived here (almost 10 years) there have been no visitors at the top of the hill over the Memorial Day holiday.

The rich might be engaging in a revelry of forced jocularity, but the working class and the poor aren't engaging much of anything except staying close to home.

[AnneD]

51. I hear this am that

motorized boats get 1 mpg. You boaters out there might verify that, but I was shocked.

[UpInArms]

16. dollar watch

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

Last trade 72.066 Change +0.084 (+0.12%)

US Dollar Faces Nasty Mix of News on Tuesday

http://www.dailyfx.com/story/bio1/US_Dollar_Faces_Nasty_Mix_1211820895098.html

The US dollar did nothing but consolidate last week’s losses on Monday, as the markets remained quiet on the Memorial Day holiday in the US. However, volatility could return in a big way on Tuesday as a spate of US economic releases are likely to signal one thing: conditions remain awful. Indeed, at 9:00 EDT, the S&P/Case-Schiller index of home prices is likely to fall sharply for the fifth consecutive quarter in Q1. Later in the morning at 10:00 EDT, new home sales are expected to fall 0.6 percent to 523K while the Conference Board’s consumer confidence index is forecasted to fall to a nearly 15-year low of 60.0 from 62.3, which won’t be entirely surprising as rocketing food and energy prices combined with the collapse of the US housing sector and tightening credit conditions have sparked widespread pessimism throughout the financial markets. Furthermore, the labor markets have started to deteriorate as evidenced by the slow gains in the unemployment rate in recent months, and things are only expected to get worse.

...more...

Dollar Strengthens in Quiet Holiday Trade; But Is It Still Vulnerable?

http://www.dailyfx.com/story/bio2/Dollar_Strengthens_in_Quiet_Holiday_1211803065070.html

In a very quiet start to the trading week marked by holidays in UK and US the dollar strengthened somewhat against the majors after taking a beating for most of last week. With US capital markets closed for Memorial day holiday and UK markets closed for a bank holiday trading is expected to be very light for the rest of the day.

Nevertheless the greenback gained some ground mainly on light profit taking in the EURUSD. Against the pound the gains in the greenback were a bit more substantial as the release of Hometrack survey in UK showed that house prices declined by the biggest margin in 3 years once again stirring speculation that the deterioration in that key sector of the UK economy will force BoE to ease. Markets continue to price in at least 50bps in cuts before the end of the year and that expectation is likely to contain any cable rally to the 2.000 level. Last week the unit got a bump from better than forecast Retail Sales, but the absolute number still printed negative indicating that the UK consumer is retrenching.

Elsewhere, the kiwi dropped at the start of trading in Asia as larger than expected Trade deficit generated some panic selling at the start of the session. On further examination however, traders realized that the gap was caused by one off items, as a purchase of an oil platform drove imports higher than expected. On the other hand exports also increased better than forecast, suggesting that demand for New Zealand’s agricultural products shows little evidence of waning. The unit recovered its losses as the night progressed

With traders coming back in full force tomorrow, attention this week will likely center on US Durable Goods and GDP numbers. Markets are looking for a revision upward in the GDP report, led by improving exports and shrinking Trade deficits. That number may help the greenback some, but the key determinant of dollar’s direction will continue to be the state of the US consumer. If gasoline prices remain sticky above $4/gallon, it is difficult to imagine any other scenario but a recession for US economy as we move into the 2nd half of the year.

...more...

[UpInArms]

18. Asia central banks prop up currencies (by selling dollars)

http://news.yahoo.com/s/nm/20080527/bs_nm/markets_asia_intervention_dc

SEOUL/SINGAPORE (Reuters) - Asian central banks moved to prop up falling currencies on Tuesday to help prevent surging oil prices from stoking inflation in economies bracing for a global slowdown.

Central banks in Indonesia, the Philippines, South Korea and Taiwan were suspected of selling dollars to support their currencies under pressure from inflation fears and wobbly stock markets, currency traders said.

Asian central banks have traditionally intervened to prevent the currency appreciation which would hurt exports, the main driver of growth for most of the region's economies.

But the focus of policy in some countries is now shifting to containing inflation with oil prices at record highs above $130 a barrel driving up costs across the economy and fuelling demands for higher wages.

A strong domestic currency makes imports cheaper, helping limit the inflationary impact of soaring energy costs.

<snip>

Five currency dealers in Seoul said the Bank of Korea had sold as much as $800 million to support the won for the second time in a week. They reported another intervention later in the day, but could not estimate its size.

...more...

[ozymandius]

49. What? $74.5 billion? Is this a mistake?

Note: I have made a change in this piece from yesterday. I forgot that there was an increase in the minimum reserve requirement in April, which means that foreign exchange inflows were actually around $22 billion higher than the ridiculously high number I discussed.

An article just came out on Reuters claiming that inside sources have revealed that China’s foreign currency reserves at the end of April were $1.7567 trillion. If this is true that means that reserves grew in the month of April by $74.5 billion, the biggest one-month reserve jump in China’s history (and probably in the history of the world).

...

To get a sense of scale, in 2006 reserves were up $247 billion for the whole year. This, at the time, was a number guaranteed to shock. No central bank in history has seen reserve growth at anywhere near this scale. Nonetheless in 2007, the growth in reported reserves nearly doubled over the previous year -- $462 billion – and more than doubled if we backed out a series of transactions that reduced headline reserve growth but had no net impact on the monetization of currency inflows.

But that wasn’t the end of record-busting reserves growth. In the first quarter of 2008 headline reserves grew by $154 billion, nearly one-third of last year’s total growth, and if you back out all the non-relevant transactions that reduced headline growth, it represented a significantly larger share of last year’s reserve growth.

.....

This monetary expansion was channeled by the banking system into higher and higher levels of fixed asset investment, and all this investment resulted in soaring industrial production which, since consumption could not keep up, resulted in ever growing trade surpluses (the trade surplus is the gap between production and consumption). It was hard to know how China could exit the trap without a much more rapid appreciation of the currency.

http://piaohaoreport.sampasite.com/china-financial-markets/blog/What-74-5-billion-Is-this-a-mist.htm

Read on for more staggering numbers and mysterious asset flows.

[DemReadingDU]

17. Question: Are credit unions safer than banks?

I recognize with all the reading here at the SMW and other blogs, that there are solvency issues with a lot of banks. But I haven't read anything yet about any credit unions having solvency issues. So has anyone had any problems having their checking account, savings account, CDs with credit unions? There is a credit union in our area that we can join, but I don't want to go there if credit unions are having the same problems as banks with solvency.

Thanks!

[UpInArms]

23. here's the wiki on credit unions

http://en.wikipedia.org/wiki/Credit_union

A credit union is a cooperative financial institution that is privately owned and controlled by its members. Credit unions differ from banks and other financial institutions in that the members who have accounts in the credit union are the owners of the credit union and they elect their board of directors in a democratic one person-one vote system regardless of the amount of money invested in the credit union.

Credit union policies governing interest rates and other matters are set by a volunteer Board of Directors elected by and from the membership itself. Only a member of a credit union may deposit money with the credit union, or borrow money from it. As such, credit unions have historically marketed themselves as providing superior member service and being committed to helping members improve their financial health.

Credit unions may be viewed as non-profit organizations, or alternatively as for-profit enterprises charged with making a profit for their members (who receive any profits earned by the cooperative in the form of reduced interest rates on loans, or as dividends paid on savings, which are taxed as ordinary income).

This debate reflects credit unions' unusual organizational structure, which attempts to solve the principal-agent problem by ensuring the owners and the users of the institution are the same people. In any case, credit unions generally cannot accept donations and must be able to prosper in a competitive market economy.

In the United States, credit unions typically pay higher dividend (interest) rates on shares (deposits) and charge lower interest on loans than banks.<1> Credit union revenues (from loans and investments) do, however, need to exceed operating expenses and dividends (interest paid on deposits) in order to maintain capital and solvency. Often credit unions have a lower cost of funds than typical commercial banks, due to a higher proportion of non/low interest bearing deposits.

Credit unions offer many of the same financial services as banks, often using a different terminology. Common services include: share accounts (savings accounts), share draft (checking) accounts, credit cards, share term certificates (certificates of deposit), and online banking.

Credit unions exist in a wide range of sizes, ranging from volunteer operations with a handful of members to institutions with several billion dollars in assets and hundreds of thousands of members.

that said - I love credit unions - their differences over banks is enormous

[DemReadingDU]

24. yes, there are a lot of satisfied people with credit unions, but

But are credit unions having solvency issues like banks because of the subprime mortgage mess? With my limited reading, I can't seem to uncover any inside scoop that credit unions, in general, are having problems.

[AnneD]

53. I got a news letter in the mail yesterday...

from the CU that answered that very question. The CU is in very good shape because they never made subprime loans. They are an obvious rip off for the member/owners. My CU is sitting pretty.

I will never go back to traditional banks. CU's suit me just fine. When I walk in, they treat me like an owner because I am an owner. When I have a problem with my account, I don't get a 1 800 number that someone in Banglore India answers, I can talk to someone in house where I bank. It is worth extra pennies.

[DemReadingDU]

57. Thanks, that is good news!

Just got back from our local credit union. Very nice experience! When setting up our account, we asked about the mortgage mess. The rep told us that they have strict policies who are approved for mortgages and did not get involved in the subprime loans. It is going to take us a few weeks to get things moved from the bank to the credit union but I feel so much better knowing my money is working for my community rather than lining the pockets of those greedy CEOs at the bank.

:hi:

[AnneD]

59. Once you have that experience....

you never go back to Mega Banks. Now each CU is a wee bit different and I have had some that I like better then others-so bear that in mind.

My daughter is going to California to school in the fall. Our Credit Union pulled up all the information on a local credit union that is in their network, a location and hours and put together an info packet for her. Her credit union checks and ATM are good there. One less thing to stress over in August.

They are giving her great rates on her Stafford loan (including forgiveness of a percentage of her loan), overdraft protection, and online banking. I am also on the account so I can view it and transfer money in an emergency. I also get e-mail alerts on the account (she responsible enough but she's still a student). I am a long time member (daughter had a TUGMA account for 5 years) and know many of the personnel on a first name basis. We great service.

The irony is...we have a friend that works at a bank there in Valencia and she may get a job at the bank when she gets there. We will see. I do like to circulate my money locally too.

[DemReadingDU]

60. It's nice to get personal experience like that

:)


And much luck to your daughter in California! She sounds like a very mature young lady and will do fine.

My daughter lived in San Francisco for a few years. She was so far from home in Ohio. Email is great! Daughter now has moved back to Ohio and bought her first house. So far, so good.

[UpInArms]

20. US economy in need of urgent action

http://news.yahoo.com/s/ft/20080526/bs_ft/fto052620081643251652

In March last year I warned in this newspaper that the global "Goldilocks" economy and markets would face a material correction within the next 12 months and there was a need to exercise greater prudence in lending and investing.

This warning was ignored by most in the private and public sectors. Unfortunately, much of what I feared would happen has materialised.

From the twin origins of the subprime fallout and the dislocation of the mortgage-backed securities markets, there has been a crisis of confidence that has already led the US economy into a period of low growth, or even a recession. Add to this mix a weak dollar and the trend of rising inflation across the world driven by high food, energy and commodity prices and it is clear the future is still fraught with risk and uncertainty.

With decoupling probably a myth, there will most likely be a worldwide economic slowdown should the US downturn be a protracted one. While there are signs that the credit markets may be bottoming out, it seems likely that the housing market will remain in its downward spiral for the remainder of the year.

The impact on the real economy could be even more serious should the US consumer decide to cut back significantly on spending. The question then becomes: what should be done to ameliorate the current slowdown before it becomes a full-blown economic crisis with potential worldwide consequences? Specifically, I would like to mention three areas where immediate action should be taken in order to restore confidence in the markets.

...more...

wow! this guy is smarmy and full of himself with very little substance and no ideas - it' like that commercial - more stuff and less filling, too!

[skoalyman]

25. Heck us regular joe's could see this comming couple years

ago lol less filling but doesn't taste great.:nopity: :hangover:

[fasttense]

27. He's Citigroup's CEO. Arrogant, and ignorant what a combo. n/t

William R. Rhodes is Chairman, President & CEO of Citibank N.A., Chairman, President & CEO of Citicorp Holdings Inc., and Senior Vice Chairman of Citigroup Inc.

Too bad he didn't warn Greenspan about four years ago.

[Doctor_J]

50. "decide to cut back on spending"?!?!?!?

decide? All you millions who have withe lost your jobs or taken a huge pay cut during Bushonomics, this depression is your fault if you decide to stop spending money

I hate republicans

[UpInArms]

26. Bank failures to surge in coming years

http://www.marketwatch.com/news/story/bank-failures-surge-credit-crunch/story.aspx?guid=%7b2FCA4A0C-227D-48FE-B42C-8DDF75D838DA%7d&print=true&dist=printTop

SAN FRANCISCO (MarketWatch) -- By April, Gary Holloway was almost three years into retirement.

He'd built a new home by a lake in Texas, bought a boat and was working on his golf game. While taking on some part-time work, Holloway also traveled for months across the U.S. with his wife, from Seattle to Washington D.C., catching up with old friends and family.

That life of leisure abruptly changed about six weeks ago when Holloway got a phone call from his former employer, the Federal Deposit Insurance Corp., or FDIC, which regulates U.S. banks and insures deposits.

Holloway, a 30-year FDIC veteran, had worked extensively with failed lenders in Houston during the savings and loan crisis in the late 1980s and early 1990s, when thousands of thrifts collapsed.

Earlier this year, the FDIC began trying to lure roughly 25 retirees like Holloway back to prepare for an increase in bank failures. It's also hiring about 75 new staff.

http://www.marketwatch.com/News/Story/Image.aspx?Guid=2fca4a0c227d48feb42c8ddf75d838da&Track=201

...more...

[DemReadingDU]

30. List of 32 Commercial Banks and Thrifts May fail

5/23/08 32 Commercial Banks and Thrifts May See the Feces Hit the Fan Blades by Reggie Middleton

Note: I am not familiar with Reggie Middleton, but he has a series of postings about the credit crisis. Here is his list of banks with and charts and graphs and analysis...

Wells Fargo - Popular Inc - SunTrust - KeyCorp - Synovus Financial Corp - Marshall & Ilsley - Associated Banc - First Charter - M&T Bank Corp - Huntington Bancshares - BB&T Corp - JPM Chase - U.S. Bancorp - Bank of America - Capital One - Nara Bancorp - Sandy Spring Bancorp - PNC - Harleysville National - CVB Financial - Glacier Bancorp - First Horizon - National City Corp - WAMU - Countrywide - Regions Financial Corp - Citigroup - Wachovia Corp - Zions Bancorp - TriCo Bancshares - Fifth Third Bancorp - Sovereign Bancorp

lots, lots more...
http://boombustblog.com/component/option,com_myblog/show,As-I-see-it-32-commercial-banks-and-thrifts-may-see-the-feces-hit-the-fan-blades.html/Itemid,20/
also posted here...
http://www.safehaven.com/article-10321.htm



If true, this is a frightening list. Five of these banks are in Ohio, and if they all fail, Ohio will be totally devastated. Does anyone else have any additional blogs that can collaborate this list?

[Dr.Phool]

37. My wife has 401K money in Key Bank. She used to work there.

I just called her and said "Get it out, TODAY".

[DemReadingDU]

41. Same here, I used to work there too.

Monies in both Fifth Third and Keybank. This is frightening, if true.
Note that I am not familiar with Reggie Middleton, so I don't know that his postings are rumors, or if there is any truth to what he says.


Edit: But if you take out the money, where do you put it?
Another bank?
A credit union?
Under the mattress?

[Dr.Phool]

43. We've been meaning to get it out of there for a while now.

This is a good excuse to do it now.

I know how my LTV pension went when the PBGC took it over.

[DemReadingDU]

44. Spouse just received a letter that his pension is endangered

Next, there will probably be a letter that pension going to PBGC, and reduced.

It's really getting scary out there.

:(

[Warpy]

45. If it's a small amount, then an insured CD is your best bet

If it's a large portfolio, then you'll have to figure out an investment strategy. My advice there is to find an investment counselor. Go for the guy with a personality like a cold pork chop. That charming guy is getting by on something besides expertise.

[DemReadingDU]

47. Insured CDs, but they are at risky banks

I understand FDIC tries to find another bank to take over everyone's accounts if a bank fails. But, what if both regional banks fail at the same time, there may not be enough FDIC to cover all people's accounts at both banks, and find another bank to take over both banks business.

Maybe I am being paranoid?

[DemReadingDU]

31. Watch out for high interest rates

from the article
http://www.marketwatch.com/news/story/bank-failures-surge-credit-crunch/story.aspx?guid=%7b2FCA4A0C-227D-48FE-B42C-8DDF75D838DA%7d&print=true&dist=printTop


When lenders need to raise new capital, they can try to boost deposits by offering attractive interest rates on certificates of deposits, or CDs.

IndyMac is currently offering the highest rates on one-year CDs, according to Bankrate.com. Others in the top 10 include Corus Bankshares, Imperial Capital Bancorp, and GMAC bank.

When Countrywide Financial was struggling last year, its federal savings bank unit began offering some of the highest CD rates in the U.S. to build deposits.

Bank of America has since agreed to acquire Countrywide and it didn't make it onto Bankrate.com's list of top 10 CD rates this week.

"These banks that are challenged for liquidity are having to go out and pay up in the market for CDs," Joe Morford, a colleague of Cassidy's at RBC, said.

Imperial Capital stopped paying dividends earlier this year. GMAC, owned by leveraged buyout giant Cerberus Capital Management and General Motors, is struggling to keep its Residential Capital mortgage business afloat.


edit: misplaced a comma, and added this link

High Yield Rates for 1 yr CD
http://bankrate.com/brm/rate/high_ratehome.asp?web=brm&prodtype=invest&product=15&sort=2

[DemReadingDU]

28. info about ING bank

Last month April I need to put some money in a savings account. With recommendations from family, and reading the SMW, and finding that ING has a 4 star rating at Bankrate.com, and finding nothing negative on google, I decided to put the money in an online account at ING.

Then I read the following on 5/23/08 about ING by Ilargi over at The Automatic Earth in the comments section...

Ilargi said...

While I don’t think ING is necessarily worse than other banks, it looks too good. And not being worse than the rest is not exactly a recommendation these days, to start with. So I looked up some ING data.

First off, they’re not a Canadian, or US bank, they’re not even just a bank. They are a banking and insurance group from Holland. That combination makes it hard to see through their earnings reports. Investment banks have to report things that commercial banks don’t etc.

ING have three basic units, I think: conventional retail and corporate banking, insurance and online banking (the latter unit is ING Direct, the one that operates in North America). What makes me nervous about them is their aggressive expansion into North America in the past decade. That has to cost. And to what end?

ING presented their Q1 earnings last week. Not particularly pretty, but awash in lofty terms about how it’ll all soon get better. And confusing, as per what reporters think they read into it. Just like at home, only a year later, that’s the idea I get from this.

Here’s what I read at first glance:

• Q1 overall profits down 20%

• Insurance division profits down 31%

• ING Direct profit down 30+%

• Fair value of U.S. residential backed mortgage securities portfolio on balance sheet, as reported by ING itself, down about 17%, from 27.5 billion euros ($42.5 billion) at year-end to 22.8 billion euros ($35.2 billion) at the end of March.

NOTE: ING’s total exposure to suspect paper is reportedly as high as $60 billlion, which is a lot for a finance group that is much smaller than Citi, UBS or BoA.

lots more comments by Ilargi...
http://theautomaticearth.blogspot.com/2008/05/debt-rattle-may-23-2008-free-market.html

[DemReadingDU]

32. 5/23/08 CNBC, 6 videos David Walker, former Comptroller

This series will probably take about 45 minutes to view all 6.

Insight on the country's deficit, with David Walker, Peter G. Peterson Foundation president/CEO
http://www.cnbc.com/id/15840232?video=751528470&play=1


Why the government should be involved with healthcare costs, with David Walker, Peter G. Peterson Foundation president/CEO
http://www.cnbc.com/id/15840232?video=751553130&play=1


Perspectives on the economy, with Pete Peterson, The Blackstone Group chairman/co-founder and David Walker former U.S. Comptroller
http://www.cnbc.com/id/15840232?video=751573252


Discussing the state of private equity, with Pete Peterson, The Blackstone Group chairman/co-founder and David Walker former U.S. Comptroller
http://www.cnbc.com/id/15840232?video=751583439


Final thoughts with Pete Peterson, The Blackstone Group chairman/co-founder and David Walker former U.S. Comptroller
http://www.cnbc.com/id/15840232?video=751601918&play=1


A recap of this morning's discussion with Pete Peterson, Blackstone founder and CNBC's Becky Quick
http://www.cnbc.com/id/15840232?video=751650420&play=1

[DemReadingDU]

33. CSPAN: You Think NAFTA, CAFTA & the Economy is Bad Now? Wait...

4/6/08
Bush signs up for North American Union without vote or consulting congress and against all recommendations of congress. Marcy Kaptur (D-OH, Toledo)

http://www.youtube.com/watch?v=TShPYA-OuPs


I apologize if this has already been posted, I just viewed it this weekend.

[skoalyman]

48. Just more selling out of america Here's an ole

diddy straight from the horse's mouth :wow: :wow:

tp://www.youtube.com/watch?v=nT-JMCDfCBo&feature

[DemReadingDU]

58. Yeh, I remember that

Bush is such a jerk, can't wait for him to be gone.

[DemReadingDU]

34. Karl Denninger - The 5-Month Checkup For 2008

5/25/08 - a "5 month review" of previous "Year In Review" and update anything that needed updating.

The US will enter a recession, if it has not already done so. It will be consumer spending driven, with its genesis found in the Housing market. The slowdown will become evident once the “real” holiday sales data is posted, and accelerate into the first quarter.
CHECK; real income has been negative every month since October, and real spending has been negative all year thus far.

Housing will not turn in 2008. The total damage to prices will exceed a cumulative 15% from 2005-2008, and it will not be over. At least one, and probably several, national home builders will be cut to the single digits on their stock price or go bankrupt and be reorganized. Residential Real Estate will NOT be a buy in 2008; you’re still at least one and probably two years too early.
CHECK - we have several home builders in single digits and the 15% cumulative decline is pretty much there.

The stupidity in the rest of the consumer lending space (rollovers in auto loans and 0% balance transfer hell for plastic, primarily) will come crashing down on these companies and bring a crushing wave of defaults there as well, along with yet more downgrades in the asset-backed paper market.
Starting, but not yet evident to a large degree.

Commercial Real Estate will collapse. The leverage in these deals has actually exceeded that in residential, if you can believe it. This will prove to have been totally insane and the losses taken there will be immense. It will also put a fork into the “this is contained” thesis, and validate the fact that generally, commercial R/E lags residential by 12-18 months. Guess what – time’s up!
Price declines reported for the first time on these; this is starting!

more predictions...
http://market-ticker.denninger.net/2008/05/5-month-checkup-for-2008-memorial.html

[CatholicEdHead]

38. ABC Radio National (Aus) has a good recap on the 1929 crash

I listened to their podcast this weekend.

http://www.abc.net.au/rn/rearvision/stories/2008/2213492.htm

It talked about how there were only a couple of really bad days, but also the losses in the fall of 1929 were recouped in the market by the following spring. Also the number of bank failures was much higher due there being so many independent banks, not the consolidated ones we have now. They also talked about the after-effects were made worse from higher interest rates and not much liquidity in the market, which Bernake has actually done the opposite of recently.


Robert Sylla: I think it probably did. Americans invested a lot in war bonds during World War I, then after the war, this got many Americans used to investing in financial securities, and after the war, the government paid off some of the debt, which put money in people's pockets, and then Wall Street rallied to the occasion by inviting Americans to invest more in stocks and private bonds and so a great many people began to play the stock market in the 1920s, people who hadn't done it before World War I. The stock market was kind of the playground of the rich. In the 1920s, Wall Street became the playground of ordinary, middle-class Americans.
.....
Robert Sylla: We in financial history view the crash proper as a period of about three weeks from October 24th, 1929, until about November 11th or 12th, 1929. That's when the Dow Jones Average fell from roughly 300 down to slightly under 200, so it lost 33% of its value in that three week period. The worst days were October 28th and 29th, Black Monday and Black Tuesday, stocks lost about somewhat over 20% of their value. So two-thirds of the crash proper happened on those two days at the end of October.
...
Robert Sylla: It is true that over the next few years the stock market went vastly lower, but what people sometimes forget is from November 11th or 12th, 1929, until sometime in April 1930, the stock market recovered most of the ground, almost all the ground it lost in the crash proper. That is, it rose from slightly under 200 all the way back up to around 300 again from November '29 to April 1930.
.....
Harold Bierman: Well the market had crashed in December of '29, it was still down but not as far down as in September, and economic variables were not that bad. Weren't as good as the summer of '29, but weren't that bad. So you had a situation where if the Fed had allowed the banks access to more money, an ability to lend, lowered interest rates, that sort of thing, it might have avoided the Depression. Certainly Friedman and Schwartz in their classic study of 1929 identified the tightening of money by the Fed in the winter of '29 as being a major factor leading to the Depression. So I think it was a combination of the stock market crash and an ill-conceived policy on the part of the Federal Reserve that led to the real Depression, real downturn in incomes of corporations and so on. Before the 1930, the economic outputs of corporations indicated prosperity; after the winter of '29-'30 there was less optimism. Things started to look dark, and they got darker and darker from '30 to '31, '32.
....

[AnneD]

40. This is evident when you look at a graph...

it didn't drop all at once. It was a long decline interupted by intermittant rallies. But make no mistake-the trend was down.

[ozymandius]

46. 11:46

Dow 12,474.18 Down 5.45 (0.04%)
Nasdaq 2,455.27 Up 10.60 (0.43%)
S&P 500 1,376.59 Up 0.66 (0.05%)
10-Yr Bond 3.8920% Up 0.0610
NYSE Volume 1,238,729,380
Nasdaq Volume 639,750,190

11:35 am : Stocks have taken a tumble and have lost most of the session's gains. The downturn is broad-based with the most noticeable decline in financials (+0.1%), which was up 1.2% at its session high.

Large-cap tech continues to outperform on a relative basis. The Nasdaq 100 is up nearly 0.7%, helped by Apple (AAPL 183.15, +1.98) and Google (GOOG 552.93, +8.31). Earlier today, telecom operator TeliaSoneria announced it has agreed to bring Apple's iPhone to Nordic and Baltic markets.DJ30 -6.43 NASDAQ +11.16 SP500 +0.59 NASDAQ Dec/Adv/Vol 1105/1592/596 mln NYSE Dec/Adv/Vol 1268/1688/365 mln

11:05 am : Stocks are making their way off the earlier lull and moving higher. Though shy of the session's best levels, stocks continue to sport solid gains.

Various sources are indicating Belgian brewer InBev may initiate takeover talks with Anheuser-Busch (BUD 56.60, -0.01) today. Shares of BUD opened the session higher on the news, but are currently trading along the unchanged line.

In other buyout news, Blackstone Group (BX 18.91, +0.37) and Apollo Management LP are in talks to acquire chemical company Chemtura (CEM 8.44, +0.64), while South Korea's LG Electronics is taking a closer look at General Electric's (GE 30.53, +0.10) appliance unit, according to The Wall Street Journal. Hitachi (HIT 72.32, +2.78) has no interest in pursuing GE's unit, according to Reuters.
DJ30 +45.27 NASDAQ +22.77 SP500 +5.36 NASDAQ Dec/Adv/Vol 927/1728/479 mln NYSE Dec/Adv/Vol 1061/1881/296 mln

[antigop]

52. SEC backs healthcare balloting

http://www.nytimes.com/2008/05/27/business/27health.html

The Securities and Exchange Commission, shifting its position, has told companies they must allow shareholders to vote on a proposal for universal health insurance coverage.

Shareholders, including religious groups and labor unions, have offered the proposal in an effort to draw the nation’s largest corporations deeper into a debate over the future of health care, fast emerging as one of the most important issue in domestic policy.

The S.E.C. has told Boeing, General Motors, United Technologies, Wendy’s International and Xcel Energy over the last several months that they may not omit the health care proposal from their proxy materials.

This came as a surprise to many executives, who said the agency had allowed companies to exclude similar proposals in the past.

Many companies say the health care principles are not a proper matter for shareholders to vote on, and they have tried to keep the proposal out of proxy statements prepared for their 2008 annual meetings.

[Tansy_Gold]

54. Uh, not to be too picky, Ozy, but isn't today . . . .

Tuesday?

:evilgrin:


Tansy Gold, who sometimes gets her meager and pathetic jollies finding the silly and innocent mistakes of those she admires and tries to emulate

[ozymandius]

61. Sure is.

Something about the holiday dulled my senses at 6am.

[AnneD]

55. Zombie debts refuse to die

Bankruptcy is supposed to get rid of bad pennies.

Prince Ella Green thought so. She and her husband, James, who live in League City, fell on hard times and filed bankruptcy in 1995.

The case was a Chapter 13, meaning the Greens submitted a plan for repaying most of their debt, which they did during the next five years.

Some debt, including a mortgage on a home in Texas City that the Greens bought as an investment property and later lost to foreclosure, was discharged as part of the bankruptcy, according to court records.

In other words, a judge ruled that the mortgage was debt the Greens were not legally responsible for paying.


Persistent efforts
Tell that to Cenlar Federal Savings Bank and several other companies that have been trying to collect the debt ever since.

more....

http://www.chron.com/disp/story.mpl/business/steffy/5799694.html

This is a must read and there is a lawsuit too. This may be a legal sleeper.

[AnneD]

56. Treasury prices fall amid mixed economic data

NEW YORK — Treasury prices slid Tuesday after the three-day weekend, with stocks mostly edging higher and investors unable to shake their inflation worries.

Last week, crude oil briefly passed a record $135 a barrel, stoking concerns about inflation devaluing long-term fixed-income assets such as Treasury bonds. Crude prices eased back Tuesday, but investors remained anxious about rising commodities prices — especially since the Federal Reserve suggested last week that although inflation is becoming a bigger concern, the central bank will likely keep interest rates on hold.

"Certainly, the Fed is quite cognizant of the dangers of inflation," said T.J. Marta, fixed-income analyst at RBC Capital Markets. "That leaves yields in no man's land. Nobody thinks there's a whole lot of value in Treasurys at this point."

The benchmark 10-year Treasury note fell 15/32 to 99 24/32 and yielded 3.91 percent, up from 3.85 percent late Friday, according to BGCantor Market Data. Bond prices move in the opposite direction of yields.

http://www.chron.com/disp/story.mpl/ap/business/5803385.html

Just a looksee for old times sake.

[ozymandius]

62. end of the day

Dow 12,548.35 Up 68.72 (0.55%)
Nasdaq 2,481.24 Up 36.57 (1.50%)
S&P 500 1,385.35 Up 9.42 (0.68%)
10-Yr Bond 3.921% Up 0.09
NYSE Volume 3,588,860,000
Nasdaq Volume 1,762,370,375

Finishing Near Session High
Dow +68.72 at 12548.35, Nasdaq +36.57 at 2481.24, S&P +9.42 at 1385.35

A drop in crude prices lent support to Tuesday’s buying interest. In turn, market participants lifted the major indices during afternoon trading to finish near their best levels of the session. Tech showed particular strength, helping the Nasdaq (+1.5%) outperform its counterparts.

Oil closed noticeably lower, partly due to renewed strength in the dollar. Crude finished $4.71 lower at $128.48 per barrel on the New York Mercantile Exchange. The drop in crude prices weighed on stalwarts Exxon Mobil (XOM 89.90, -0.90) and Chevron (CVX 99.58, -1.15). However, oilfield services companies Schlumberger (SGP 101.03, +1.00) and Baker Hughes (BHI 87.48, +2.01) performed relatively well.

Technology (+1.9%) was the session’s best performing economic sector. In particular, Apple (AAPL 186.43, +5.26) lent considerable support, helped by news it is taking its iPhone to Nordic and Baltic markets after signing an agreement with a regional telecom operator. Large-cap tech helped the Nasdaq 100 finish almost 1.9% higher.

In buyout news, Blackstone Group (BX 18.91, +0.37) and Apollo Management LP are reportedly in talks to acquire chemical company Chemtura (CEM 8.49, +0.69), while South Korea's LG Electronics is taking a look at General Electric's (GE 30.40, -0.03) appliance unit, according to The Wall Street Journal. Hitachi (HIT 72.37, +2.83), however, has expressed that it has no interest in pursuing the unit, according to Reuters

On the economic front, the Consumer Confidence Index for May came in at 57.2, which is down from the prior month's 62.8. The reading reflects the weight of higher fuel prices and the challenges facing the housing market.

Notably, the S&P/Case-Shiller Home Price Index for March came in at 172.2, which is down from the 176.0 registered in the prior month. For the first quarter, the index came in at 159.2, which is down from the prior reading of 170.6.

Providing a positive surprise, new home sales for April were reported at 526,000, which is above the consensus estimate of 520,000, and up 17,000 month-over-month.

Separately, San Francisco Fed President Yellen stated that the Fed's rate policy and the fiscal stimulus will lift the economy, while total and core inflation will moderate in the next couple of years. Yellen also stated the financial markets are still far from normal.

However, former Fed Chairman Greenspan had a more pessimistic outlook, stating in an interview with the Financial Times that the U.S. is more likely to have a recession than not. Supporting the gloomy outlook, famed value-investor Warren Buffett sees a long, deep recession, according to Reuters.com.

Still, stocks had a strong showing Tuesday. Participants’ interest in equities and a fear of inflation pushed Treasuries out of favor. In particular, the 10-year Treasury Note ended 18 ticks lower. ..Nasdaq 100 +1.9%. ..S&P Midcap 400 +0.8%. ..Russell 2000 +1.4%.

[andres hunter]

63. The stocks are going down

every day. Why?