STOCK MARKET WATCH, Monday, April 4, 2011

[Pale Blue Dot]

Source: du

STOCK MARKET WATCH, Monday April 4, 2011

AT THE CLOSING BELL ON April 1, 2011

Dow 12,376.72 +56.99 (+0.46%)
Nasdaq 2,789.60 +8.53 (+0.31%)
S&P 500 1,332.41 +6.58 (+0.49%)
10-Yr Bond... 3.47 +0.02 (+0.44%)
30-Year Bond 4.51 +0.02 (+0.54%)

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Market Conditions During Trading Hours

Euro, Yen, Loonie, Silver and Gold

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Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren
Dishonorable Mention: former House majority leader, Tom DeLay

Bush Administration Officials Charged = 1
Name(s): Richard Lopez Razo

Financial Sector Officials Convicted since 1/20/09 = 11

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http://d.yimg.com/b/util/anysize/551x-1209600,

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This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.

Read more: du

[Pale Blue Dot]

1. No reports today. nt

[Pale Blue Dot]

2. Oil rises to above $108 as US jobs market improves

SINGAPORE – Oil prices jumped to fresh 30-month highs above $108 a barrel Monday in Asia as signs of a recovering U.S. jobs market bolstered investor optimism that global crude demand will strengthen.

Benchmark crude for April delivery was up 53 cents at $108.47 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose $1.22 to settle at $107.94 on Friday.

In London, Brent crude for April delivery was up 75 cents to $119.31 a barrel on the ICE Futures exchange.

The U.S. said Friday its economy added 216,000 new jobs last month and the unemployment rate dropped to 8.8 percent, boosting trader confidence that more workers will help fuel consumer spending.

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

[hamerfan]

7. Wonderful.

Lies and/or minimum wage jobs cause everyone to pay higher gasoline prices.
Simply frikkin' wonderful.

[Roland99]

108. jobs market might be improving....

for those servicing people of high net worth.

[Pale Blue Dot]

3. U.S. Stock-Index Futures Rise; GE, Alcoa Shares Gain in European Trading

U.S. stock-index futures advanced, indicating the Standard & Poor’s 500 Index may extend its first back-to-back weekly gain since February.

General Electric Co. climbed in early New York trading after Barron’s reported that the company may not be liable for financial damages from Japan’s nuclear power plant problems. Alcoa Inc. (AA) also gained in Europe.

S&P 500 Index futures expiring in June rose 0.1 percent to 1,329.4 at 6:01 a.m. in New York. Dow Jones Industrial Average futures added 0.1 percent to 12,328. Nasdaq-100 Index futures advanced 0.4 percent.

The S&P 500 has risen 6 percent in 2011, extending last year’s 13 percent rally, amid government stimulus measures and as corporate earnings beat analysts’ estimates for an eighth straight quarter. The index had fallen as much as 6.4 percent from this year’s high on Feb. 18 as concern grew about Japan’s nuclear crisis and uprisings throughout the Middle East and northern Africa.

http://www.bloomberg.com/news/2011-04-04/u-s-stock-index-futures-rise-ge-alcoa-shares-gain-in-european-trading.html

[xchrom]

4. recommend

[xchrom]

5. Fukushima marks a 'nuclear ice age'

http://www.atimes.com/atimes/Japan/MD05Dh01.html
TOKYO - The era of nuclear renaissance is over. The Fukushima shock marks the beginning of the "nuclear ice age".

The ongoing nuclear crisis at Japan's Fukushima Daiichi nuclear plant following an earthquake and tsunami is stirring up energy policy of almost all countries that use nuclear power. The repercussions from Fukushima are being strongly being felt at home and abroad, just as aftershocks are still being felt in northern Japan, including Tokyo.

There are 432 nuclear plants operating in 30 countries across the globe, with 66 reactors under construction. Prime Minister Naoto Kan said last Thursday he will rethink from bottom up the government's plan to build at least 14 more nuclear reactors by


2030, as Japan scrambles to overcome its worst nuclear crisis.

[xchrom]

6. EU practices acrobatics with Caspian gas flip-flop

http://www.atimes.com/atimes/Central_Asia/MD01Ag01.html

MONTREAL - The changing geo-economic environment around the Central Asian and South Caucasus hydrocarbon energy producers is reflected in a public flip-flop by a major European Union official this week.

At a news conference in Berlin, European Union Energy Commissioner Gunther Oettinger, who last November became the first EU figure to admit that the EU-sponsored Nabucco and Russian-sponsored South Stream gas pipeline projects were rivals, reversed course and declared they were not actually competing projects.

Nabucco seeks to take gas from the Caspian Sea region through Turkey to Southeast and Central Europe. Russia seeks to lay the


South Stream pipeline across the bed of the Black Sea to the Balkans, although its Prime Minister Vladimir Putin is ready to scrap the project if he can find another way to block Nabucco. (See Compressed gas on the Caspian table, Asia Times Online, March 25, 2011.)

[xchrom]

8. Foreign currency trading is easy — an easy way to lose money

http://www.latimes.com/business/la-fi-amateur-currency-trading-20110403,0,588787.story

More and more Americans are dabbling in currency trading and losing in spectacular fashion. Experts say the structure of the currency market makes it hard for amateurs to beat the house.

Reporting from New York—
Dorothy Ouma began trading foreign currencies after seeing a TV commercial touting it as a way to make extra money, something she could use as a single mother raising three children.

"The ads made me think, 'This is easy,'" said Ouma, 52, an administrator with the Grand Prairie, Texas, police department.

Ouma used her credit card to fund an account with an online currency broker. Within a few weeks of swapping dollars for yen and euros, she said, her $3,000 of borrowed money was gone.

"Even if you make money for a little while, eventually you just end up losing," she said.

[Demeter]

14. There's a Sucker Born Every Minute

Borrowing on a credit card to speculate in foreign currency.

Do better just to buy travelers checks and hold until they are worth more and cash them in....

[AnneD]

92. Borrowing to invest....

is called speculation. The easiest way to lose your shirt (and underware for that matter)is speculating.

[Demeter]

95. Currency Speculation isn't "Investing"

[tclambert]

105. I did that for awhile, went broke, and had to start over.

The artithmetic seduced me. They were offering credit for 10% less than my mutual funds had been making. Then the dotcom bubble burst and George W. Bush became president. The worst stock market since the Great Depression reduced my mutual funds to rubble, but the debt survived, solid as the Rock of Gibraltar, and they started increasing the interest rates. Why is acquiring experience so expensive?

[xchrom]

9. How Big Pharma distorts the costs of developing new drugs

http://www.latimes.com/health/la-fi-hiltzik-20110403,0,788500.column

Every time I come across a big-number statistic about the size or significance of some industrial activity, my nose wrinkles.

You know the figures I mean: The porn business takes in $10 billion to $14 billion a year. California's marijuana harvest is worth $14 billion a year, making it the state's biggest cash crop. NCAA March Madness costs employers $1.8 billion in lost productivity.

Figures like these have several things in common: They're eye-catchingly big, they're unverifiable by empirical means and they reek of fakery.

The statistic that may be most hazardous to your health is one pegging the research and development cost of bringing a new drug to market at $1.3 billion. Its purveyor is the Pharmaceutical Research and Manufacturers of America (PhRMA), which exploits the number's shock value to secure its lobbying agenda on Capitol Hill.

[Demeter]

15. Hmmmm....

Do they have any numbers to back it up?

Part of the cost of research is the failed drugs....if one out of ten makes it, the company is a success....

[xchrom]

17. i don't know.

i think the only thing we can count on in this case -- is that we are being lied to -- and in this instance it's kind of a big deal.

and then i would spin the kaleidescope and say -- it's another way people take a little out our pocket books to make a lot.
leaving us poorer.

[Demeter]

20. True

The secrecy is telling that the game's afoot.

[Fuddnik]

22. "The opportunity costs"

If they invested the money in other ventures, they would have made X amount more. In other words, if they were a hedge fund instead of a pharma R&D company, they'd be rich. RICH!

Then again, if the queen had balls, she'd be king.

[xchrom]

97. the document to go along with the article -- long.

https://www.documentcloud.org/documents/81465-col-drugcosts-new-study.html

thanks to better believe it.

[Po_d Mainiac]

10. This coupon is good for a gallon of gas

http://www.yale.edu/terc/democracy/may1text/images/New5$.jpg

[xchrom]

12. ...

:mad: :rofl: i feel both ways.

people are starting to look at me funny.

[AnneD]

55. Welcome to the club.....

I have been written off as crazy so often it would make a novel. The more I seen and put together, the crazier they think I am. My conspiracy theories have a way of coming true so how crazy am I? I have started doing better once I start acting on my theories and not letting the 'smart' people talk me out of them.

Again, thanks to this thread for letting me know I am not the only person that has doubts and crazy ideas. I am not longer so quick to dismiss a conspiracy theory-they have an annoying tendency to be coming true as of late.

[Demeter]

110. It's 3.85 today, up 20 cents since Friday

when will the madness stop?

[xchrom]

11. Extra interest charged to pay off FHA loans early comes under fire

http://www.latimes.com/business/realestate/la-fi-harney-20110403,0,6735337.story

Could the federal government's booming FHA mortgage program be forcing homeowners to pay tens of millions of dollars of extra interest charges when they sell their houses or refinance their loans?

Critics say yes. The government says the critics aren't providing the full picture.

Those critics include Sen. Benjamin L. Cardin (D-Md.), who is sponsoring legislation that would prohibit Federal Housing Administration lenders from collecting a full month's worth of interest from sellers and refinancers who pay off their mortgages — close escrow — before the final day of the month.

No other major source of financing — not Fannie Mae, Freddie Mac or even the VA — requires interest payments from borrowers beyond the date they pay off their loans. On an FHA loan, however, if you sell your house and close early in the month, you are charged interest through the rest of the month.




another example of american enterprize -- really doing nothing and skimming in a boatload of moolah.

[xchrom]

13. GOP budget plan would revamp Medicare and Medicaid to slash deficit

http://www.latimes.com/news/nationworld/nation/sc-dc-republicans-budget-20110404,0,1584409.story?track=rss

Reporting from Washington—
House Republicans' 2012 federal budget plan will propose significant changes to Medicare, shift control of Medicaid to the states and aim to chop more than $4 trillion from the deficit over the next decade, House Budget Committee Chairman Paul Ryan said Sunday.

Ryan's broad overview of the GOP plan, which is slated to be officially unveiled Tuesday, included a combination of entitlement reforms and spending cuts that amount to a dramatically different approach to deficit and debt reduction than that advocated by President Obama.

Obama's plan, proposed in February, aimed to shave $1.1 trillion from the deficit over 10 years through a combination of increased revenues and targeted budget cuts. He did not suggest structural changes to the nation's social safety net programs — Social Security, Medicare and Medicaid.

[Demeter]

16. Future jobs won’t support decent living standard: Report

http://news.yahoo.com/s/yblog_thelookout/20110401/ts_yblog_thelookout/future-jobs-wont-support-decent-living-standard-report

It's most welcome news that job growth seems to be picking up again--even if we'll need a whole lot more of it to get back to where we were before the Great Recession.

Still, as we've reported, there's growing evidence that the new jobs, many of which are in sectors like retail, food services, and health care, simply aren't as good--in terms of wages, hours, and seniority--as the ones they're replacing. And a report released today only adds to the concern.

The study, commissioned by the nonprofit group Wider Opportunities for Women, looks at how much income it takes to support a basic standard of living for an American family--and finds that many of the jobs of the future won't pay enough to provide that.

To calculate this "economic security" income, the study's authors certainly didn't assume a lavish lifestyle. They considered basic needs--housing, food, utilities, health care, child-care, and transportation--plus the cost of modest saving for retirement and a small surplus for emergencies. (At at a time when economic "shocks" are increasingly common, that's an essential part of financial security.) They don't factor in some things many of us take for granted, like entertainment or eating out.

The result? To achieve economic security, a single parent with two children needs an income of just over $30,000 a year--nearly twice the federal minimum wage--while a two-income household needs almost $68,000.

[xchrom]

19. it's all just so frustrating. nt

[AnneD]

56. Then what is the point....

people left the farms during the industrial revolution because you couldn't feed clothe and shelter yourself.

If working as a wage slave no longer does it for you, maybe it is time to reverse the flow.

How long do they think they can sell all their shinies if there isn't a market. Even FOrd had more common sense. Our modern captains of industry are nothing but ass wipes.

[fasttense]

64. When my husband lost his job and couldn't find another one, we went back to the farm.

We thought we would at least have food. And we do. We have so much food that we sell a lot of it. We hardly spend any money on food anymore. We put in a greenhouse (hoop-house) and now we have veggies mostly year round.

I think moving back to the farm is a very viable alternative.

[AnneD]

72. Thanks for the confirmation.....

We are not too far removed from the farm. Anytime brother needs cash, he sells a cow or two. He is not rich, but he has all he needs. He has made it through several droughts. He is a real whiz at water management, and mechanics. His latest thing is bees. When I go up to visit, I have to bring coolers because I bring back scads of meat and veggies. He is my ace in the hole and the fist place I would go if the balloon goes up (and we are of like mind politically).

I still have a green thumb and even though I am confined to patio gardening, I am always experimenting. Right now I am doing vertical gardening as a way to increase my yield and am thinking about starting a worm bed, and researching alternate energy forms. If I ever do get a back yard to garden in it will be Katy bar the door.

[Demeter]

18. Extensive Outsourcing Leads to Trouble by: Paul Krugman

http://www.truth-out.org/content/extensive-outsourcing-leads-trouble

...the United States needs federal bureaucrats to manage spending, including spending on private contractors, and that understaffing the government — which we’re doing already, and will do more of if the right gets its way — actually increases the deficit. I agree.

“In practice, cutting civil servants often means either adding private contractors or ... resorting to the belief that industries have a deep capacity to police themselves,” John Gravois writes.

“Strange as it may sound, to get a grip on costs, we should in many cases be hiring many more bureaucrats — and paying more to get better ones — not cutting their numbers and freezing their pay.”

And — perfect timing — we have a new report from the bipartisan Commission on Wartime Contracting, which found that tens of billions of dollars have been wasted on undersupervised contractors in Iraq and Afghanistan. According to the report, “although no estimate captures the full cost associated with this waste, fraud, and abuse, it clearly runs into the billions of dollars....

[xchrom]

21. Watch Out for Rising U.S.-China Competition

http://blogs.hbr.org/cs/2011/04/watch_out_for_rising_us-china.html

Conventional wisdom says that when it comes to U.S.-China relations, commerce plays a stabilizing role, giving both sides a reason to work together. But in the next few years, commercial ties between the two countries will almost certainly become more competitive and could even disrupt the relationship.

That's because China wants to become a leader in just the kinds of technology sectors that have traditionally given the U.S. a global edge. The result will be increased competition between the two countries — within China and globally — and a deepening unease on both sides.

China has made no secret of its goals. Even though the country emerged from the global crisis stronger than nearly every other major economy, Premier Wen Jiabao reiterated last month that its current economic-growth model, based on low-cost manufacturing and overinvestment, is "unbalanced, unstable, uncoordinated, and unsustainable." Instead, China is set on developing higher-value-added and technology-intensive industries. And its huge capacity to mobilize domestic capital gives it the power to do so.

[xchrom]

23. Want Innovative Thinking? Hire from the Humanities

http://blogs.hbr.org/cs/2011/03/want_innovative_thinking_hire.html

How many people in your organization are innovative thinkers who can help with your thorniest strategy problems? How many have a keen understanding of customer needs? How many understand what it takes to assure that employees are engaged at work?

If the answer is "not many," welcome to the club. Business leaders around the world have told me that they despair of finding people who can help them solve wicked problems — or even get their heads around them. It's not that firms don't have smart people working with them. There are plenty of MBAs and even Ph.Ds in economics, chemistry, or computer science, in the corporate ranks. Intellectual wattage is not lacking. It's the right intellectual wattage that's hard to find. They simply don't have enough people with the right backgrounds.


my apologies if this has been posted here before

[TalkingDog]

35. Trying to convince people of this is like getting kids to eat broccoli and brussel sprouts

You have to sell it as trees and bushes and tell them they are Godzilla.

If we "creative" types could just find a hook to convince them that: a) hiring us was their idea and they'll get all the credit b) they are Godzilla... we'd be in like Flynn.

[Demeter]

39. In Other Words, Hire Women

Pay attention to the people who pay attention.

[xchrom]

41. like elizabeth warren instead of timothy gheitner?

the perfect -- and flag waving obvious example -- the current admin.

[Demeter]

57. The Elizabeth Warren Rorschach Test

http://www.nakedcapitalism.com/2011/03/the-elizabeth-warren-rorschach-test.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

[xchrom]

58. excellent find. very good read. nt

[Demeter]

24. Citi secures bids for consumer finance arm

Citigroup has drawn a step closer to selling its consumer finance business, securing at least three bids of about $2bn from private equity groups.

The division traces its roots to Commercial Credit, the building block upon which Citi’s former chairman, Sandy Weill, built his financial empire. Yet when the bank set aside businesses and assets that did not fit its post-crisis strategy, the unit – named until recently CitiFinancial – was among those targeted for disposal. Last week at least three private-equity consortiums submitted bids in the second round of Citi’s auction for the business,
according to people familiar with the matter. The bank will hold a third round before asking for final bids, the people said.

Read more >>
http://link.ft.com/r/3JFELL/NSDORM/XBAN6/M9W8NG/C5OBI2/GX/t?a1=2011&a2=4&a3=3

DEEP-SIXING THE EMBARRASSMENT?

[Demeter]

25. US regulators divided on systemic risk list

US officials are split on how many financial institutions should be branded systemically important, say people familiar with inter-agency talks, amid desperate lobbying by non-bank financial groups to avoid the designation.

The Federal Deposit Insurance Corporation is arguing for a broad approach, pulling in large hedge funds, insurers and asset managers, while the Treasury and the Federal Reserve prefer to designate only a handful.

Read more >>
http://link.ft.com/r/KC2844/ZBPWT0/RP6QL/S3E23V/183J25/D5/t?a1=2011&a2=4&a3=3

[Demeter]

26. Barney Frank: Greenspan is wrong - we can reform finance

Many commentators have suggested ways in which financial reform might be improved. But until last week no one had seriously suggested that we should have done nothing in response to the financial crisis. Alan Greenspan suggests that we should not even have tried.

Read more >>
http://link.ft.com/r/4RNQTT/TPSA5E/ULCJB/OJKOSG/JI7V9K/CM/t?a1=2011&a2=4&a3=3

OBAMA TAKES HIS CUES FROM GREENSPAN--HE ORIGINAL WIZARD OF OZ

[Demeter]

27. Rep. Paul planning hearing on Fed foreign lending

http://www.reuters.com/article/2011/04/02/usa-fed-paul-idUSN0214517620110402

Persistent Federal Reserve critic Representative Ron Paul plans to hold a hearing on the U.S. central bank's emergency loans to the branches of non-U.S. banks, his spokeswoman said on Saturday.

"I was surprised and deeply disturbed ... to learn the staggering amount of money that went to foreign banks," Paul said in a statement.

"These lending activities provided no benefit to American taxpayers, the American economy, or even directly to American banks," he said.

Paul spokeswoman Rachel Mills said the Republican lawmaker, who advocates abolishing the Fed and returning to a currency backed by gold or silver, is planning a hearing on the discount windowlending in May. Details are still being worked out, she told Reuters.

Data the Fed was required by courts to disclose on Thursday showed the U.S. branches of foreign-headquartered financial firms had made extensive use of the central bank's emergency lending discount window during the severe financial crisis that froze financial markets in the fall of 2008.

[AnneD]

94. Mental note....

buy stock in Fruit of the loom and Hanes. Also Tide and Oxy Clean. Some stains just won't come out. :evilgrin:

[Demeter]

28. No Relief Likely for Muni Bonds

http://online.wsj.com/article/SB10001424052748704587004576240741284333546.html?mod=dist_smartbrief

With last week concluding the slowest quarter for municipal-bond issuance in 11 years, attention is shifting to when borrowers will come back.

If they ramp up soon, it won't be pretty, say bankers and portfolio managers, who say demand remains weak.

...That outlook could bring dreary results to holders or sellers of municipal bonds, as well as governments and other public borrowers hoping to tap the municipal market for construction projects and other finance needs. On the bright side, opportunistic investors seeking a high yield from borrowers are more likely to get what they want.

Lately, neither individual nor large investors in the U.S. municipal-bond market are showing much appetite for such bonds, which began to dive in late 2010 and, after regaining some ground, suffered more price pressure in March...

[Demeter]

29. Government shutdown looms over talks as crunch time for 2011 budget nears

http://www.washingtonpost.com/politics/crunch-time-for-the-2011-budget/2011/04/03/AFoonzVC_story.html

With the prospect of a government shutdown looming Friday, leaders of both parties publicly staked out seemingly inflexible positions while staff members worked in private on a possible compromise to finally pass the 2011 budget.

[Demeter]

30. IMF: Top Five Borrowers

http://www.aleablog.com/imf-top-five-borrowers-updated/

By Outstanding Balance
As of March 17, 2011
Greece: 12,736
Romania: 10,569
Ukraine: 9,250
Pakistan: 5,233
Ireland: 5,012
(In millions of SDRs)
Source: IMF

[Demeter]

31. Scott Walker: Bad for Wisconsin Business

http://news.firedoglake.com/2011/03/23/scott-walker-bad-for-wisconsin-business/

...Right from the beginning, Walker’s cancellation of a high speed rail link between Madison and Milwaukee sent a rail car business out of Milwaukee, abandoning a large factory. The removal of collective bargaining rights from public employees may lead to a serious catastrophe for the state’s forestry industry, as they are likely to lose their third-party “certified market” status.

Now, his policies have sent other businesses throughout the state scurrying. A wind power project near Green Bay will be shuttered.

Chicago energy development firm Invenergy on Monday notified state regulators that it’s withdrawing plans to build a large wind power project south of Green Bay.

The company said it was concerned about moving forward because of the state of flux in Wisconsin’s regulatory climate when it comes to wind siting. Gov. Scott Walker has proposed a bill that would sharply curtail wind development.

In fact, since Walker has been sworn in, 19 plants have closed down for a variety of reasons. And as you can see, some of them are directly related to Walker’s policies on regulations, public employee unions, renewable energy and high speed rail. Without including Talgo (the rail car maker) and Invenergy (the wind power company), 2,207 workers in Wisconsin have lost their factory jobs since Walker’s inauguration. Even Walker’s one claim of “job creation” for Wisconsin is nonsense:SEE LINK FOR MORE

[Demeter]

32. Morgan Stanley's Liquidity Pool

http://economicsofcontempt.blogspot.com/2011/02/morgan-stanleys-liquidity.html

It’s now official: the week of September 15, 2008 was a really bad week to work in Morgan Stanley’s prime brokerage. And the next week wasn’t so hot either. Various internal documents released with the FCIC report provide a fairly detailed picture of Morgan Stanley’s liquidity position during the crisis, and it’s not pretty. Prime brokers like Morgan Stanley relied heavily on customer cash held in prime brokerage accounts (known as “free credits”) to fund themselves. So when hedge funds all pulled their cash from Morgan Stanley’s prime brokerage after Lehman failed, that had a direct effect on Morgan Stanley’s liquidity pool.

On one day alone (Wednesday, September 17th), Morgan Stanley’s prime brokerage lost $36.6 billion in free credits. That’s $36.6 billion instantly gone from the firm’s liquidity pool. To add insult to injury, that same day, prime brokerage customers also withdrew $12.3 billion of excess margin, which dealers also count toward their liquidity pool. For the week, Morgan Stanley’s prime brokerage lost an amazing $86.5 billion in liquidity. And the next week, they suffered an additional $43.3 billion of outflows, for a two-week total of $129.8 billion. That’s a hell of a fortnight!

Overall, Morgan Stanley’s liquidity pool was falling by tens of billions per day — the firm was basically imploding. Without the government bailout, it’s pretty clear that they wouldn’t have lasted another week.

[Demeter]

33. Morgan Stanley’s Deep Secret Now Is Revealed: Jonathan Weil

http://www.bloomberg.com/news/2011-03-23/morgan-stanley-s-deep-secret-now-is-revealed-commentary-by-jonathan-weil.html

Here’s a little secret the Federal Reserve Board doesn’t want you to know. On Sept. 24, 2008, while financial markets were collapsing, Morgan Stanley borrowed $3.5 billion through the Fed’s oldest lending program, the 98-year- old discount window.

..............................
Fox News is pressing a similar request concerning Fed loans from August 2007 to November 2008. Much of the information the two companies sought has been disclosed already. The Dodd-Frank Act, which President Barack Obama signed last July, forced the Fed to release details of many of its bailout programs. Still, the Fed has yet to divulge which banks borrowed through its discount-window program. It won’t be long now, though.
.......................................

The loan came three days after Morgan Stanley said it had received Fed approval to become a bank holding company, giving it access to the discount window for the first time.

..............................
They’ll just have to get used to that, though. Under Dodd- Frank, the Fed will be required to publish details of its discount-window loans, including borrowers’ identities, after two years. That’s why the Obama administration stepped in last year and urged the high court not to take up the case, saying the new disclosure rules made an appeal by the Fed unnecessary.

[Demeter]

34. Are Fannie and Freddie Giving Banks Yet Another Bailout by Not Pursuing PMI Claims?

http://www.nakedcapitalism.com/2011/03/are-fannie-and-freddie-giving-banks-yet-another-bailout-by-not-pursuing-pmi-claims.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

The further you look at the banking mess, the more the same problems keeps staring back: too many losses, not anywhere enough equity or reserves, and a lot of tap dancing by the officialdom to pretend otherwise.

We wrote yesterday, thanks to some sleuthing by Chris Whalen, that Fannie and Freddie might be sitting on north of $100 billion of unreported losses. If they started realizing those losses, one of the first parties that would take a hit would be the private mortgage insurers, since on high loan to value loans (over 80% of appraised value), they were in the business of guaranteeing the loan balance in excess of 80%. So while the failure of the GSEs to act is no doubt part of the extend and pretend shell game, it serves to keep PMIs that would otherwise be as dead as certain notorious parrots alive.

Adam Levitin points to a second and far more important set of beneficiaries from the GSE’s failure to take action on their defaulted loans: the TBTF banks:

…the GSEs don’t seem to be making claims on PMI policies despite being the loss payees. The reason why is that if the GSEs made claims on the PMIs, it would quickly render all of the PMIs not just insolvent, but illiquid (which is the real kiss of death). And if the PMIs went under, then the GSEs would have to take huge write-downs on all of the still performing loans with PMI insurance. Chris Whalen estiamtes that in order to avoid perhaps $100B plus in write-downs, the GSEs are forgoing several billion in PMI claims. If this is the case, it shows what a farce GSE regulation by FHFA is.

There’s a further twist, however, that Yves post didn’t capture. A lot of PMI is reinsured. And guess who does about half of PMI reinsurance? The captive reinsurance affiliates of the large banks.

While most large banks have reinsurance capitves, the captives of the big 4 banks get about 1/3 of all PMI reinsurance premiums, which probably translates to something like 1/3 of the exposure. Just to list the biggest, that’s Balboa Reinsurance (Countrywide/BoA); Bank of America Reinsurance (BoA); Cross Country Insurance (Chase); North Star Mortgage Guaranty Reinsurance (Wells Fargo). I haven’t figured out the extent of this exposure, as not all PMI is reinsured, and not all reinsurance is first-loss position, but there is definitely some bank group skin on the line with PMI.

What this all means is that if the GSEs are forbearing in making claims on their PMI policies, it not only hides the GSEs’ losses. It also means we’re seeing another quiet bailout of the banks.

FOR MORE DETAILS ON THIS HITHERTO UNDISCLOSED, BIG FAT SHELL GAME, SEE LINK

[snot]

87. Wow! Good comments on that analysis, too.

[Demeter]

36. Ignoramitocracy PAUL KRUGMAN

http://krugman.blogs.nytimes.com/2011/03/22/ignoramitocracy/

Harold Pollack points out that everything I said about Elizabeth Warren applies, with even more force, to Donald Berwick, a highly qualified technocrat who can’t even get a confirmation hearing on his nomination to run Medicare and Medicaid. And then there is, of course, Peter Diamond, an economist’s economist with a sterling reputation, who is being blocked at the Fed.

Part of what’s going on here is simply opposition for the sake of opposition. But as Pollack says, the underlying problem is that anyone with actual expertise and any kind of public profile — in short, anyone who is actually qualified to hold a position — is bound to have said something, somewhere that can be taken out of context to make him or her sound like Pol Pot. Berwick has spoken in favor of evaluating medical effectiveness and has had kind words for the British National Health Service, so he wants to kill grandma and Sovietize America.

So what lies down this road? A world in which key positions can only be filled by complete hacks, preferably interns from the Heritage Foundation with no relevant experience but unquestioned loyalty.

In short, we’re on our way to running America the way the Coalition Provisional Authority ran Iraq.

[Demeter]

37. Educating College Graduates So They Can be Unemployed

THIS PIECE JUST SEEMED TO LOGICALLY FOLLOW--SHOWING ONCE AGAIN THE FOOLISHNESS OF "PULL" FOR EMPLOYING PEOPLE, OVER INDEPENDENT "MERIT"

http://www.newdeal20.org/2011/03/22/educating-college-graduates-so-they-can-be-unemployed-39390/

A new Federal Reserve Bank of San Francisco paper, Recent College Graduates and the Labor Market by Bart Hobijn, Colin Gardiner, and Theodore Wiles, argues that unemployment is particularly bad for those just graduating from college. It explains how this puts pressure on structural or “recalculating” arguments of unemployment:

The current labor market outcomes of recent college graduates closely mirror those observed during the 2001 recession and the subsequent jobless recovery. This is important because recent college graduates are not subject to the kinds of structural factors that have been posited as the main sources of weakness in the overall labor market. Unemployment rates during the 2001 recession are widely recognized as cyclical in nature. Similarities in the experiences of recent college graduates in the labor market during the two recessions and recoveries are evidence that high unemployment rates in the current downturn and recovery are also mainly cyclical.

....I don’t shine the flashlight here to ignore the pain that those without college degrees experience in this economy. But if young people with college degrees can’t survive in the post-recession era, nobody can. And this explodes the idea that education alone, instead of monetary and fiscal policy, is the way out of our current high unemployment rate.

...Unfortunately, the recession’s effect is not limited just to the initial job search and wages. The negative impact persists far beyond that. Kahn found that the effect “falls in magnitude by approximately a quarter of a percentage point each year after college graduation. However, even 15 years after college graduation, the wage loss is 2.5% and is still statistically significant.”

[xchrom]

38. How Brainless Technology Cost Me $6.34 at the Supermarket

http://blogs.hbr.org/cs/2011/03/how_brainless_technology_cost.html

Why does your supermarket herd you toward those clumsy self-service checkout stations while ignoring the incredible usefulness of the smartphone in your pocket? Same reason your own company might be forcing customers to use other clumsy technologies.

Marketing groups like to think of themselves as technically savvy and feel a need to prove it. But over and over, they confuse usefulness to the company with usefulness to the customer. The result is implementation of technologies that customers don't like. Customers might "accept" a technology, but that's not the same as liking it.

So there I was, staring at the very few open checkout lanes, trying to decide which was worse: waiting in a long queue or using one of the self-checkout stations. I opted for the latter. I scanned and rescanned and weighed and reweighed, all the while being talked at by an automated voice that clearly assumed I was stone deaf. Checkout took 15 minutes. Assuming the store pays cashiers $10 per hour, I figured I was owed $2.50 for my labor.

[Demeter]

42. Proving the Author Is Clueless

there is a learning curve, but apparently, this disgruntled customer was unwilling to pay that price for the speed and access that auto-checkout provides.

And there's no reason you can't vent on a machine mindlessly running through its schtick--it's very stress-relieving, and the machine has no feelings to hurt.

Perhaps that's it, the author has to hurt a living person to feel accomplishment?

[AnneD]

61. I refuse to go through self checkout.....

1) I am not employed by the store, I am a customer. Don't give me the crap about it saves me money on my groceries. Bull Shit. It only lowers your bottom line and you get a bigger bonus, I get squat.

2) You are outsourcing your work to me the customer instead of hiring some one that needs a job. Every time I use that self service, it is another job lost. Actually 1&1/2 if you count the high school or disabled kid that is bagging my groceries for me.

The author proves to be another worthless, clueless dipshit.

[Demeter]

70. Then You Boycott Amazon? Buy Nothing On Line or Through Parcel Post?

Where does it end? Back to making own clothing from the wool you sheared off your sheep, spun, dyed, wove? Raising flax and cotton?

The same arguments greeted the self-service gas station. An acquaintance of my age insisted she was far too much a helpless female to learn how to do it, and spill gas on herself...and this was a bitch who could take on any male with both hands tied behind her back..I did win against her in small-claims, though.

[AnneD]

79. You balance your use of technology...

and consider the consequences. Actually, I haven't used Amazon, I haven't needed to. I don't order on line that much-only very hard to find items and usually I call in my order.

There is a place for Industry, I am advocating to be more judicious. Be a Mennonite instead of Amish. I saw gas and banks become self service. I saw call menus replace humans. They try to sell it as better customer care or saving money but it isn't and doesn't. It takes a job from someone.

Yes I may pay more but I don't mind. It is better for our American society to keep in mind the big picture. Besides, not every latest and greatest idea works.

I guess I am living on the wrong continent.

[Demeter]

83. Boycotting Technology Not the Same As Boycotting Abusive Employers

If a employer cheats his workers, boycott. If the workers strike, boycott.

This country is going to have to stop waiting for George to do it. George died of a stroke back when Reagan was elected.

As for whether technology is misused--that's a whole 'nother question. Technology that is misused, or too darn complicated, fails early, and is rapidly abandoned. (OBVIOUS EXCEPTIONS: NUCLEAR POWER AND FRAUDULENT FINANCIAL INSTRUMENTS THAT GET GOVERNMENT SUBSIDY, BAILOUT, AND CO-OPT DEMOCRACY...)

If you ever spent as much time in line at the grocery as I do (shopping for my clientele) you'd be grateful for the chance to get out in 1/5th the time, with the eggs not crushed by the canned tomatoes....

[AnneD]

96. Guess it is different here....

an abusive cashier is not the norm and when the lines start to get long, they open other lines. The max baggers are at 5 on weekdays and all day Sat. and Sun. to handel the crowds. The baggers are good (and I am picky about squashed bread and cracked eggs). My lines are never really that long. People bemoan the lack of manners in Houston but for a city this size, I think we do pretty well.

[zogofzorkon]

100. Auto checkout is inherently abusive to employees .

I remember when there were no long lines because they employed many more checkout people.
If you don't have the time to wait in line you may have groceries online in your area. It offers the technology that fires you up and employs order pickers and delivery people. I don't use it because I prefer to check date codes and condition of packaging of groceries in person.

[plumbob]

74. Yep. Under no circumstances will I use the self-checkout. When

I was young and even dumber than I am now, I bought the pump your own gas and save money line.

Well, that worked out, didn't it?

And now that I'm in the 60s, who checks my tire pressure, oil level, antifreeze, brakes, washes the windows, vacuums the floorboards, all of which were free back when? Oh, yeah, me.

[StarburstClock]

106. I boycott self checkout at grocery stores as well, it's BS cost cutting for lousy stores

I've done it, learned how to easily and still don't like it. Some item inevitably will not ring up correctly forcing me into yet another line somewhere else. Or, somebody really slow will be in front of me. Or, I'll have to go through some extra steps for coupons. Or, something will ring up at the wrong price: it's all BS so the store doesn't have to pay somebody.

I prefer shopping online to most crappy stores though, the whole failed capitalist model of "brick and mortar" stores with huge markups to pay their exorbitant real estate prices along with making some massive profit percentage is a load of bull, not to mention most stores are out of whatever they claim to have in stock anyway.

[zogofzorkon]

65. Auto-checkout is anti labor .

It reduces the number of jobs available, puts downward pressure in terms of hours and benefits on the wages of those still working checkouts, and acts to reduce the humanity of checkout workers by treating them as machines. I will always endure the lines and will leave a store rather than use self scan when that is the only option.
As for venting on a machine one might try having a pleasant conversation with a human while paying for their purchase. Its a value added to the price and a day brightener for the worker.

[AnneD]

82. If they are in the mood....

I will always look them in the eye and exchange pleasanties. It makes for a happier day. I decline the bag carry out because I am healthy, but I always thank them for the offer. One day I might need it.

You wouldn't believe the thank yous I get when I tell the checkers my feeling about auto check outs. The young ones don't understand it but the older ones do. ;)

[zogofzorkon]

91. The older ones also understand that management no longer comes throught the ranks

the ranks but through diploma and pedigree. We're not talking CEO's here but dept managers to shift supervisors. Its a topic they can go on about for a while, ever mindful of the cameras and scan rate monitors of course. Recently a longing for the old union methods that worked has been a recurring theme.

[Demeter]

84. Some jobs are not worth having

I have several of those, myself, right now. They pay the bills. Sorta.

Would I like something a little more self-gratifying? Of course. And if it comes along, or I can invent it, I will.

Do I think everyone deserves a job that feeds both parts of a person? Certainly. Paying a living wage would be a priority, but so too would feeding the soul. Safety. Environment.

This is the kind of overtime all thinking and feeling people are going to have to put in, making that kind of world come into existence. Pick a battle worth winning, and work on it.

This isn't one of those.

[zogofzorkon]

98. Some jobs were worth having and could be again. It is not the job that

determines the wage and satisfaction but attitude toward that job. That attitude is manipulated by those that stand to gain from cheap labor. Dishwashers, checkout people, mechanics, plumbers, air traffic controllers .... now teachers and civil service are are targeted as not worthy.
The battle is not about self scan, that is simply a mechanism being used to further a return to feudalism and as such should be fought. It takes little effort and needs no organization. Simply refuse to use or to be used by the machine.

[AnneD]

111. That's it in a nutshell ....

Good summary. Refuse to use or be used by the machinery.

I always use the example of butchers. That use to be a great high paying job. Now it is a less than minimum wage job that causes repeditive trauma and carpal tunnel syndrome to those working on lines. Unsanitary conditions that are little better than those described by Upton Sinclair in The Jungle at the turn of the last century. Once Armour broke the meat pakers union, it went down hill. I miss the butchers that knew what they were doing. That is increasingly a lost skill, and it is a skill.

A job like being a cashier may not be the job you want, but it might be enough to help keep body and soul together in a pinch. I want that job to be there for someone.

[xchrom]

40. When Customer Rebellion Becomes Open Revolution

http://blogs.hbr.org/haque/2011/04/when_customer_rebellion_become.html

What if your business isn't just fundamentally ill-equipped to survive and thrive in the 21st century — but is actually unequipped for it?

Indulge me for a paragraph, if you will. Imagine that there was a country in which bailed-out bankers announced extravagant bonuses. OK, that part's eminently realistic — even mundane. But then imagine that people (not activists, or even dreadlocked sign-waving hippies — just regular folks) began to express their dismay, anger, even outrage, everywhere from Twitter to the local bar, and that served as the spark for a self-organizing movement. And because people had the courage, self-belief and just plain orneriness to self-organize, their parliament was forced to do what just mere months ago might have been unthinkable: to tax those bailed-out bankers' bonuses at 100%. And not just going forward — but retroactively, since the beginning of the crisis. Poof: kiss that fleet of supercars, that fourth vacation home in Bermuda, and that closetful of handmade Swiss watches goodbye.

[Demeter]

43. I'll drink to that!

:toast:

[xchrom]

44. ...

:toast:

[AnneD]

62. That was called....

the Boston Tea Party...the original not the co-opted one.

[DemReadingDU]

45. WSJ: Mixed Signals Marked Sokol Meeting

4/2/11 Mixed Signals Marked Sokol Meeting
Bankers Thought Pitch Was for Senior Berkshire Executive, Not High-Powered Individual Investor

When bankers from Citigroup Inc. met David Sokol late last year to talk about potential transactions, they thought they were dealing with him as a senior executive of Berkshire Hathaway Inc., according to people familiar with the matter. Mr. Sokol may have viewed that Dec. 13 meeting in New York differently. When asked by The Wall Street Journal on Wednesday if he met the Citigroup bankers in his capacity as a Berkshire representative or as a private investor, Mr. Sokol said he meets frequently with investment bankers and "I meet them for both" roles.

It nonetheless came as a "shock" to the Citigroup bankers when they learned Mr. Sokol bought roughly $240,000 of shares of Lubrizol Corp. a day after their meeting, sold them, and then purchased $10 million shares about two months before Berkshire's $9 billion deal unveiled March 14 to acquire Lubrizol, according to people familiar with the matter.

The Securities and Exchange Commission is investigating the events surrounding Mr. Sokol's stock trading and the Lubrizol deal, a person familiar with the matter said. Mr. Sokol was chairman of Berkshire utility arm MidAmerican Energy Holdings Co. and chief executive of the Berkshire aircraft unit NetJets Inc.

Lubrizol was one of the companies reviewed by Citigroup and Mr. Sokol in that December meeting, at which Citigroup's bankers touted Lubrizol's management team and chief executive, according to people familiar with the matter.

more...
http://online.wsj.com/article/SB10001424052748704530204576237170960624878.html?mod=WSJ_business_whatsNews


4/4/11 Karl Denninger: Berkshire: What Did Sokol Really Do?
http://market-ticker.org/akcs-www?post=183563

[Demeter]

46. Banks Hit for Credit Union Ills

http://online.wsj.com/article/SB10001424052748703410604576217023625225138.html?mod=WSJ_hp_LEFTTopStories

Federal regulators are blaming Wall Street's biggest firms for the collapse of five institutions at the heart of the nation's credit-union industry and are seeking to recoup tens of billions of dollars in losses on securities that doomed the five. In one of the broadest accusations that Wall Street helped cripple financial institutions during the crisis, the National Credit Union Administration, or NCUA, has threatened to sue several investment banks unless they refund over $50 billion of mortgage-backed securities sold to the five institutions, called wholesale credit unions....Regulators seized the five wholesale credit unions in 2009 and 2010, inheriting a pile of battered bonds now worth only about $25 billion, or half of their face value.

The NCUA is accusing Goldman Sachs Group Inc., Bank of America Corp.'s Merrill Lynch unit, Citigroup Inc. and J.P. Morgan Chase & Co. of misrepresenting the risks of the bonds to wholesale credit unions, which loaded up on the bonds in their role of investing on behalf of retail credit unions, according to people familiar with the situation...According to people familiar with the matter, agency officials recently issued an ultimatum to several firms that churned out the bonds: Either refund every dollar spent to buy the bonds when they were issued or face lawsuits seeking to recover the money.

............................................

The wholesale credit unions, also known as corporate credit unions, are at the heart of the nation's credit-union system. They not only invest customer deposits but also provide services such as check clearing for nearly 8,000 "retail" credit unions—member-owned cooperatives that act somewhat like banks for firefighters, teachers and other workers who have something in common.

....................................

Federal regulators are starting to flex their legal muscle against executives, directors and outsiders blamed for the demise of financial institutions during the crisis.

For instance, the Federal Deposit Insurance Corp.'s board has authorized the filing of lawsuits seeking to recover more than $3.5 billion from officers and directors at failed U.S. banks.

Last week, the FDIC accused the wives of Washington Mutual Inc.'s two top executives at the time of the big thrift's 2008 collapse of illegally moving cash and houses into trusts to shield the assets.

The executives called the suit seeking over $900 million baseless.

[Demeter]

48. Beware the Predatory Pro Se Borrower!

http://www.nakedcapitalism.com/2011/03/beware-the-predatory-pro-se-borrower.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

[Demeter]

49. Foreclosure crisis: Common ground between investors and homeowners

http://www.tampabay.com/news/business/foreclosure-crisis-common-ground-between-investors-and-homeowners/1156195

Talcott Franklin wants homeowners in distress to know they have more in common with the big institutional investors who hold their mortgages than they might imagine.

Both would benefit if the servicers who act as middlemen offered loan modifications, even forgiving principal, rather than foreclose.

And both would like to see the banks that created explosive mortgage-backed securities take more responsibility for their role in the housing collapse.

Franklin, a Dallas lawyer, represents a growing number of investors who are pushing for those goals.

In the past, these investors would have had little recourse. They didn't own enough of the securitized package — the huge bundles of home loans they invested in — to push for payback. They also had no way to identify their co-investors. But last year Franklin, an expert in securitization and former partner at Patton Boggs, made this pitch: Hire me to pursue your collective interests.

Today Franklin's unusual "clearinghouse" represents about one-third of all subprime investors, who hold more than $500 billion in 6,700 deals. And Franklin, 45, is trying to use this clout to apply heat to the financial institutions that devised these investments....

[Po_d Mainiac]

88. As the clawbacks multiply

The civil courts may well do what the "regulators" (read SEC and FED) should have done. If these suits are settled at anywhere near face value, the TBTF are going to find that the so-called liquidity crunch of 07/08 was pocket change.

It may only take a couple of these cases to go full term (with the judgement rulings against the Street) for the bernank to quit living in denial.

A few more prime time broadcasts ALA "60 Minutes" won't hurt.

[AnneD]

99. It is baseless....

until you have to settle out of court. You go NCUA :fingersnap:

[Festivito]

47. Debt: 03/31/2011 14,270,114,530,800.38 (UP 59,974,542,563.65) (Thu, UP big. Q2 ends.)

(Good day.)
out getting a coffee.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,651,643,154,138.73 + 4,618,471,376,661.65
UP 60,838,207,379.56 + DOWN 863,664,815.91

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 312-Million person America.
If every American, man, woman and child puts in $3.21 THAT'S 1B$, and $3,208.33 makes 1T$.
A family of three: Mom, Dad, Child: $9.62, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 12 seconds we net gain another American, so at the end of the workday of the report, there should be 311,688,992 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $45,783.18.
A family of three owes $137,349.55. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 21 reports in the last 30 to 28 days.
The average for the last 21 reports is 4,191,825,321.11.
The average for the last 30 days would be 2,934,277,724.78.
The average for the last 28 days would be 3,143,868,990.83.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 126 reports in 182 days of FY2011 averaging 5.62B$ per report, 3.89B$/day.
Above line should be okay

PROJECTION:
There are 661 days remaining in this Obama 1st term.
By that time the debt could be between 15.2 and 17.7T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
03/31/2011 14,270,114,530,800.38 BHO (UP 3,643,237,481,887.30 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +0,708,491,499,908.60 ------------* * * * * * * * * * * * * * * * * BHO
Endof11 +1,420,875,810,256.26 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
03/11/2011 +000,832,058,508.78 ------------********
03/14/2011 +000,380,093,829.66 ------------******** Mon
03/15/2011 +066,006,214,426.70 ------------**********
03/16/2011 +001,148,655,957.01 ------------*********
03/17/2011 -014,916,428,437.31 -
03/18/2011 +000,616,236,061.23 ------------********
03/21/2011 -000,100,873,734.64 --- Mon
03/22/2011 +000,366,066,174.28 ------------********
03/23/2011 -000,063,255,741.95 ----
03/24/2011 -015,763,143,549.40 -
03/25/2011 -000,034,574,737.25 ----
03/28/2011 +000,227,402,237.21 ------------******** Mon
03/29/2011 +000,181,007,415.32 ------------********
03/30/2011 +000,670,089,469.30 ------------********
03/31/2011 +060,838,207,379.56 ------------**********

100,387,755,258.50 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4794838&mesg_id=4795019

[Festivito]

107. Debt: 04/01/2011 14,251,174,516,308.48 (DOWN 18,940,014,491.90) (Fri, DOWN some.)

(Good day.)
A Mickey D again, or am I chicken.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,649,667,078,138.63 + 4,601,507,438,169.85
DOWN 1,976,076,000.10 + DOWN 16,963,938,491.80

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 312-Million person America.
If every American, man, woman and child puts in $3.21 THAT'S 1B$, and $3,208.25 makes 1T$.
A family of three: Mom, Dad, Child: $9.62, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 12 seconds we net gain another American, so at the end of the workday of the report, there should be 311,696,192 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $45,721.36.
A family of three owes $137,164.09. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 3,400,735,932.69.
The average for the last 30 days would be 2,607,230,881.73.
The average for the last 31 days would be 2,523,126,659.74.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 126 reports in 183 days of FY2011 averaging 5.47B$ per report, 3.77B$/day.
Above line should be okay

PROJECTION:
There are 660 days remaining in this Obama 1st term.
By that time the debt could be between 15.2 and 17.7T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
04/01/2011 14,251,174,516,308.48 BHO (UP 3,624,297,467,395.40 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +0,689,551,485,416.70 ------------* * * * * * * * * * * * * * * * * BHO
Endof11 +1,375,334,929,929.49 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
03/11/2011 +000,832,058,508.78 ------------********
03/14/2011 +000,380,093,829.66 ------------******** Mon
03/15/2011 +066,006,214,426.70 ------------**********
03/16/2011 +001,148,655,957.01 ------------*********
03/17/2011 -014,916,428,437.31 -
03/18/2011 +000,616,236,061.23 ------------********
03/21/2011 -000,100,873,734.64 --- Mon
03/22/2011 +000,366,066,174.28 ------------********
03/23/2011 -000,063,255,741.95 ----
03/24/2011 -015,763,143,549.40 -
03/25/2011 -000,034,574,737.25 ----
03/28/2011 +000,227,402,237.21 ------------******** Mon
03/29/2011 +000,181,007,415.32 ------------********
03/30/2011 +000,670,089,469.30 ------------********
04/01/2011 -001,976,076,000.10 --

37,573,471,878.84 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4799782&mesg_id=4799940

[Demeter]

50. Mortgage Delinquencies Keep Falling

http://community.nasdaq.com/News/2011-03/mortgage-delinquencies-keep-falling.aspx?storyid=63140

The number of mortgages in delinquency continues to fall and has shrunk by nearly one-fifth over the past year, according to new figures released today by Lender Processing Services (LPS).

The rate of delinquent mortgages has declined by 18.2 percent over the past year, according to the mortgage and data tracking firm, including a monthly decline of 1.2 percent in February. The figures include mortgages at least 30 days past due but not yet in foreclosure.

Overall, 8.80 percent of all outstanding mortgages are delinquent, according to the firm, for a total of nearly 4.7 million mortgages. Another 2.2 million are currently in foreclosure, or 4.15 percent of all mortgages.

Even as delinquencies have fallen, the number of mortgages in foreclosure has increased over the past year, up 7.4 percent from February 2010. The total did fall off slightly last month, however, decreasing 0.2 percent from January. All told, nearly 13 percent of all U.S. mortgages are in jeopardy, or nearly 6.9 million home loans either delinquent or in foreclosure.

The states with the highest combined rates of foreclosure and delinquencies in February were Florida, Nevada, Mississippi, New Jersey and Georgia, according to LPA. The lowest rates were reported in Montana, Wyoming, Alaska, South Dakota and North Dakota. The figure are derived from the a database of nearly 40 million mortgages.

Read more: http://community.nasdaq.com/News/2011-03/mortgage-delinquencies-keep-falling.aspx?storyid=63140#ixzz1IYqTvti6

[xchrom]

51. interesting. nt

[Hotler]

52. k&r Good morning eveyone. n/t

[Demeter]

53. More on the Lack of Criminal Prosecutions: Was the SEC Deterred by a Widely Overlooked Ruling?

http://www.nakedcapitalism.com/2011/03/more-on-the-lack-of-criminal-prosecutions-was-the-sec-get-deterred-by-a-widely-overlooked-ruling.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

LENGTHY AND COMPLICATED AND GOSSIPY

[Demeter]

54. Sleaze Watch: NY Fed Official Responsible for AIG Loans Joins AIG As AIG Pushes Sweetheart Repurchas

http://www.nakedcapitalism.com/2011/03/sleaze-watch-ny-fed-official-responsible-for-aig-loans-joins-aig-shortly-before-aig-pitches-sweetheart-repurchase-to-ny-fed.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

I DON'T KNOW WHY THE PUBLIC FOCUSES ON CELEBRITY GOSSIP--FINANCIAL GOSSIP IS SO MUCH MORE TITILLATING!


....We were probably remiss in not commenting on the peculiar announcement of AIG’s offer to buy back the bonds in the New York Fed’s Maiden Lane II portfolio for $15.7 billion. The stated reason, that the purchase would “reduce its obligation” to the government is nonsense; it’s astonishing that the press is parroting it. As this Cleveland Fed summary indicates, the latest of a series of restructurings converted the remaining debt payable by AIG to equity; it has paid down all its loan balances. the New York Fed loan to Maiden Lane II is payable by that entity, not by AIG (AIG does have an “equity” position in that portfolio).

AIG can buy plenty of bonds in the marketplace; the only reason for it to offer to buy these bonds in particular is if it believes it can obtain them at a discount, which means that this is yet again another pretty blatant subsidy to the giant insurer. (The only other rationale we could fathom at the time of the announcement of this offer was to justify the government’s continued insistence that all these bailout programs were really great deals. Yes, if you have the Federal Reserve engaging in QE, you can play a three card monte game that makes your older portfolio buys look amazingly astute. But as we discuss below, the evidence has now fallen out conclusively on the side of this move being yet another subsidy to AIG).

Note that if the NY Fed were serious about selling these bonds and maximizing value to the public, the last way you’d do it would be as a single massive portfolio. Big portfolio sales do result in discounts due to the lack of competing bids (think of selling all the artwork in an estate, which included a lot of painting, sculptures, collectable ceramics, and rugs, as a block versus selling the items individually in an auction). The way to fetch a decent price would be to break the portfolio up, in some cases down even to the single bond level, or at least into much smaller homogeneous lots, and work the orders through multiple dealers over time. Admittedly, AIG made its brazen offer back in December and the officialdom failed to respond...

......................................................

So we have a former NY Fed official, deeply involved in the exchanges among the Fed and AIG and almost certainly the Treasury as well, now joining AIG. It isn’t hard to imagine that the reason he was hired was due to his intimate knowledge of how to move things along at the NY Fed and Treasury, and in particular, what Blackrock had told the NY Fed about Maiden Lane II and what the NY Fed’s return and political considerations were. The Treasury is not trying to protect the NY Fed from any information advantage AIG might have regarding the Maiden Lane II assets; Blackrock is certainly up to that task. It’s entirely about appearances of cutting a deal that favors AIG without that looking too bloody obvious.

So in this warped world of priorities, where giving financial firms great deals to “preserve the system” and cook the books on the TARP are top priorities, having an former insider grease the wheels is probably seen as really helpful. It’s merely another proof of what Simon Johnson pointed out in May 2009: the government is firmly in the hands of financial oligarchs.

[xchrom]

59. +1

[Demeter]

60. Wachovia Paid Trivial Fine for Nearly $400 Billion of Drug Related Money Laundering

http://www.nakedcapitalism.com/2011/04/wachovia-paid-trivial-fine-for-nearly-400-billion-of-drug-related-money-laundering.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

YVES NOTES:

...Wachovia’s business in Mexico was coming under closer and closer scrutiny by US federal law enforcement. Wachovia was issued with a number of subpoenas for information on its Mexican operation. Woods has subsequently been informed that Wachovia had six or seven thousand subpoenas. He says this was “An absurd number. So at what point does someone at the highest level not get the feeling that something is very, very wrong?”...

I suspect you never imagined “too big to fail” and “too big to jail” were this intimately connected.

[Demeter]

63. The Big March Job Report Celebration

http://www.cepr.net/index.php/blogs/beat-the-press/the-big-march-job-report-celebration?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+beat_the_press+%28Beat+the+Press%29

Okay, this celebration around the jobs report is really getting out of hand...

First off, no one should include the stock market as indicator of the economy's well-being. Rich people are happy -- that's nice -- it has little to do with the economy. The car buying is positive, but with so many of the cars now imported or largely comprised of imported parts the impact of this surge in sales is much less than would have been the case 30 years ago. The drop in the Institute for Supply Management's index suggests that manufacturing is likely to make a marginally smaller contribution to growth in the months ahead, not good news. (The Bureau of Labor Statistics employment diffusion index for manufacturing, a measure of the percent of sectors that expect to add workers, fell from 66.0 in February to 63.0 in January, it had been 73.5 in January.)

As noted above, 216,000 jobs is not especially impressive, especially given the depth of the hole that our economic policymakers put us in. In only 15 of the 52 months from February 1996 to May of 2000 did the economy create fewer than 216,000 jobs. In most cases the weakness was caused by bad weather. And this was at a time when the working age population was more than 10 percent less than today.



I have one more point skunk to toss over at the celebrators. Here is the path of the employment to population ratio (EPOP) over the downturn. Note that we have only risen slightly from the low hit in December of 2009 and the EPOP is actually a hair lower today that it was a year ago. The drop in the unemployment rate over this period was entirely due to people leaving the labor force. Now is that good news or what?



Source: Bureau of Labor Statistics.

[fasttense]

69. Great read, thanks for posting this. n/t

[Demeter]

76. Or, for a Video Interview

http://www.youtube.com/watch?feature=player_embedded&v=n1w6w2n9Hks

[Demeter]

66. The Bank Run We Knew So Little About By GRETCHEN MORGENSON

http://www.nytimes.com/2011/04/03/business/03gret.html?adxnnl=1&ref=business&adxnnlx=1301926957-lZHsZbIzy9vnvfjeBIOCRw

IN August 2007, as world financial markets were seizing up, domestic and foreign banks began lining up for cash from the Federal Reserve Bank of New York.

That Aug. 20, Commerzbank of Germany borrowed $350 million at the Fed’s discount window. Two days later, Citigroup, JPMorgan Chase, Bank of America and the Wachovia Corporation each received $500 million. As collateral for all these loans, the banks put up a total of $213 billion in asset-backed securities, commercial loans and residential mortgages, including second liens.

Thus began the bank run that set off the financial crisis of 2008. But unlike other bank runs, this one was invisible to most Americans.

Until last week, that is, when the Fed pulled back the curtain. Responding to a court ruling, it made public thousands of pages of confidential lending documents from the crisis....

ANOTHER ANGLED VIEW OF THE GLOBAL EVENTS

[xchrom]

67. Beware of Innovations from Daily-Deal Sites

http://blogs.hbr.org/cs/2011/03/what_to_make_of_daily_deal_inn.html?cm_sp=blog_flyout-_-cs-_-what_to_make_of_daily_deal_inn

The daily deal industry, still dominated by Groupon, is in the midst of rapid-fire innovation, presenting new opportunities — and some significant risks — for merchants.

Within just the past few weeks, LivingSocial introduced Family Edition deals, focusing on family-friendly activities such as visits to zoos, aquariums, and art classes, and Groupon launched Groupon Now, delivering time- and location-specific deals on an ongoing basis to consumers through location-aware devices such as smartphones.

Startups with new twists on the daily-deal model continue to emerge almost weekly. LevelUp, which launched in early March, offers a sequence of increasingly better offers from the same merchant to repeat customers — the goal being to make repeat purchasers out of daily-deal customers, who typically buy just once. LevelUp also costs merchants considerably less than Groupon, which usually charges 50% of the revenue generated on the deal. LevelUp allows businesses to keep 100% of the revenue generated by the first deal to new customers and takes only 25% of the proceeds from the second and third deals when they are purchased by the same customers.

[Demeter]

68. Regulating the Shadow Banking System

http://ineteconomics.org/blog/money-view/regulating-the-shadow-banking-ystem

The problem with Dodd-Frank, and with Basel III as well, is that they start with the banking system, not the shadow banking system....OTC derivatives reform is at the very center of any attempt seriously to engage with the problem of regulating the shadow banking system. We learned in the crisis that, under modern conditions, central banks serve as dealer of last resort, essentially backstopping the key market-making function of security dealers. But what about normal times?

The Federal Reserve Act of 1913 created the Fed as a democratically accountable analogue to the former private lender of last resort, J. P. Morgan, and his club of New York bankers. The issue of the current day is how to create a similarly accountable alternative to the club of New York dealers. This is the subtext of current debate about moving derivatives trading to central counterparty clearinghouses or exchanges.

[Demeter]

71. David Apgar: The OCC – The Saint We Needed and the Devil We Got

http://www.nakedcapitalism.com/2011/04/david-apgar-the-occ-the-saint-we-needed-and-the-devil-we-got.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29


The OCC (Office of the Comptroller of the Currency) might have saved us from the mortgage crisis. Instead, as Matt Stoller’s post on the OCC’s actions to suppress bank data about possible foreclosure malfeasance suggests, we have a regulator that seems to have turned its back on transparency.

When Republicans in Congress wanted to take as much control of the economy as possible from the Clinton White House in 1999 they let the Federal Reserve draft the Gramm-Leach-Bliley banking reform. This is the bill that effectively put mortgage lending out of reach of the OCC examiners who traditionally reviewed a third of the loans every national bank made every few years.

The so-called reform empowered the Fed to keep OCC examiners — the only ones among all of the regulators who regularly reviewed significant pools of big banks’ actual loan files — from looking at the operations of those banks’ nonbank subsidiaries. You’d never believe that the major banks promptly moved their edgier mortgage operations into nonbank subsidiaries — and out of view of OCC examiners.

That’s right — Congress essentially halted US supervision of major bank mortgage operations in 1999. It took just eight years for those chickens to come home to roost....

[snot]

89. And that was on the heels of recovery from the S&L crisis created by dereg of S&L's.

[Demeter]

73. Judges in Florida Start Inflicting Pain on Foreclosure Mills and Trusts

http://www.nakedcapitalism.com/2011/04/judges-in-florida-start-inflicting-pain-on-foreclosure-mills-and-trusts.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

...So what did the judge do?

1. Cancelled the note

2. Ordered title to be conveyed by the trust back to the owner

3. Ordered the HSBC trust that tried to foreclose and the foreclosure mill and its successors to jointly and severally indemnify the borrower should the original note resurface in another case

So consider what happened if the servicer was foreclosing in the name of the wrong trust…it has just made the trust it filed under and the foreclosure mill liable if the right party ever shows up.

A few rulings like this will really focus the minds of everyone in the food chain.

[Demeter]

77. Alabama Judge Accepts New York Trust Theory, Dismisses Foreclosure Action for Failure to Comply With

http://www.nakedcapitalism.com/2011/04/alabama-judge-accepts-new-york-trust-theory-dismisses-foreclosure-action-for-failure-to-comply-with-pooling-and-servicing-agreemen.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

....A judge in Alabama in a case called Horace v. LaSalle overturned a foreclosure action based on the failure of the trust to comply with the terms of the pooling & servicing agreement. As you see, the judge ruled that the borrower can assert rights under the Pooling and Servicing agreement as a third party beneficiary and that he was “surprised to the point of astonishment” that the trust had not complied with the terms of its PSA.

The ruling in favor of the borrower endorses an argument we have made since last year on this blog, that the pooling and servicing agreement stipulated a specific set of transfers be undertaken to convey the borrower note (the IOU) to the securitization trust within a specified time frame. New York trust law was chosen to govern the trusts precisely because it is unforgiving; any act not specifically stipulated by the governing documents is deemed to be a “void act” and has no legal force. So if a the parties to a securitization failed to convey a note to the trust within the stipulated timetable, retroactive fixes don’t work...

[Demeter]

78. Made-Up Definitions (SUB-PRIME MORTGAGES) By James Kwak

http://baselinescenario.com/2011/04/02/made-up-definitions/



Many commentators who want to blame Fannie and Freddie for the financial crisis base their arguments on analysis done by Edward Pinto. (Peter Wallison bases some of his dissent from the FCIC report on Pinto; even Raghuram Rajan cites Pinto on this point.) According to Pinto’s numbers, about half of all mortgages in the U.S. were “subprime” or “high risk,” and about two-thirds of those were owned by Fannie or Freddie. Last year I pointed out that Pinto’s definition of “subprime” was one he made up himself and that most of the “subprime” loans held by Fannie/Freddie were really prime loans to borrowers with low FICO scores. Unfortunately, I made that point in an update to a post on the somewhat obscure 13 Bankers blog that was mainly explaining what went wrong with a footnote in that book.

Fortunately, there’s a much more comprehensive treatment of the issue by David Min. One issue I was agnostic about was whether prime loans to people with low (<660) FICO scores should have been called “subprime,” following Pinto, or not, following the common definition. Min shows (p. 8) that prime loans to <660 borrowers had a delinquency rate of 10 percent, compared to 7 percent for conforming loans and 28 percent for subprime loans, implying that calling them the moral equivalent of subprime is a bit of a stretch. Min also shows that most of the Fannie/Freddie loans that Pinto classifies as subprime or high-risk didn’t meet the Fannie/Freddie affordable housing goals anyway — so to the extent that Fannie/Freddie were investing in riskier mortgages, it was because of the profit motive, not because of the affordable housing mandate imposed by the government.

Min also analyzes Pinto’s claim that the Community Reinvestment Act led to 2.2 million risky mortgages and points out that, as with “subprime” loans, this number includes loans made by institutions that were not subject to the CRA in the first place. Of course, the CRA claim is ridiculous on its face (compared to the Fannie/Freddie claim, which I would say is not ridiculous on its face) for a number of reasons, including the facts that only banks are subject to the CRA (not nonbank mortgages originators) and most risky loans were made in middle-income areas where the CRA is essentially irrelevant.

[Demeter]

81. The Failures of Fannie: Responsibility for the Mortgage Servicing Mess

http://www.creditslips.org/creditslips/2011/03/the-failures-of-fannie-responsibility-for-the-mortgage-servicing-mess.html

The news that an Illinois court is halting foreclosures by law firm Fisher and Shapiro LLC will spark another round of frustration about who is responsible for the mess that is the mortgage servicing industry. There is plenty of blame to go around, but I rarely hear mention of the contributions of Fannie Mae and Freddie Mac to the mortgage servicing industry.

Fannie and Freddie, whatever one thinks of them in their role as guarantors, are a serious part of the problem in the mortgage servicing world--and they long have been. As an initial matter, consider that Fisher and Shapiro, the Illinois firm that admitted to altering affidavits to add fees, is an approved Fannie Mae firm to foreclose on homeowners in Illinois. You can verify this for yourself on Fannie's publicly available "retained attorney list." Fannie pulled a couple of Florida firms off its list following allegations of misbehavior according to Housing Wire, but this type of "oops, a bad one slid by" reaction from Fannie is exactly part of the problem. It is still treating mortgage servicing as a "bad apple" problem and not a "rotten barrel" problem. Of course, Fannie built the barrel to a large extent through its servicing guidelines, so perhaps Fannie is incapable of rethinking mortgage servicing.
To my mind, the Fannie and Freddie guidelines are a big part of the fast-at-all-costs attitude of the mortgage servicing world and for the incredible concentration of foreclosure work in a few law firms. These firms were rewarded by Fannie with all or most of the work for a given state because they could meet Fannie's time and cost guidelines for "appropriate" servicing. But those guidelines themselves are/were often the problem. ...

[Demeter]

75. GE tax affairs put Immelt in political spotlight

http://www.ft.com/cms/s/0/4f1ab962-5ca5-11e0-ab7c-00144feab49a.html#ixzz1IZFKMoKG

or try

http://www.ft.com/cms/s/0/4f1ab962-5ca5-11e0-ab7c-00144feab49a.html#ixzz1ILeyPtgo

[Demeter]

80. Magnetar Strikes Again: JP Morgan Negotiating Settlement with SEC on Toxic CDO

http://www.nakedcapitalism.com/2011/04/magnetar-strikes-again-jp-morgan-negotiating-settlement-with-sec-on-toxic-cdo.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

[Demeter]

85. If Home Prices Counted in Inflation

http://www.nytimes.com/2011/04/02/business/02charts.html?ref=business

"The failure, Dear Brutus, lies not in our stars, but in ourselves...trying to reduce life to one single number..." ---Demeter

[snot]

90. Wish there were a CPI that focussed entirely on essentials:

food, shelter (whether owned or rented), healthcare, energy.

The rest, I can live without.

[Demeter]

93. That would throw 60% of the country below the poverty level

Can't have that. It would start a revolution.

[AnneD]

101. Once did a home health visit....

well to do lady. Turns out she was an economist that helped start the CPI in the 40's. She argued to include food, fuel, and all the other 'volatile' factors in the index. Her point-do you want a photo or an oil painting?

She said the boys didn't much care for the bread and butter issues. I told her I thought they just didn't want to spook the cattle. She laughed so hard she told me she would have to get another Nurse otherwise she would pull her stitches laughing.

I get my info from the most interesting places.

[xchrom]

102. i find that fascinating.

most women would want those items listed.

they pay way more attention to the price of that stuff -- especially if they have kids.

[DemReadingDU]

104. so true

Spouse has no idea the price of foodstuffs, nor the amounts that are paid for bills. All he does is look at the total amount of money in wallet, and spends, spends, spends...until it is gone (or until the next stop at the ATM machine) :(

In my informal surveys, it appears that wives generally manage the family finances in a marriage nowadays, and mainly the women know where those dollars go when food and utilities increase.

[AnneD]

109. It has always been that way with Mom...

and now in our household.

My stepfather bitched bitterly when grocery prices went up during the mid 70's. Mom was a stay at home Mom. Now before you get the wrong idea she saved a ton of money for the family because: she sewed curtains, upholstered Dad's truck, did the books and taxes for business and home, maintained the 1 acre plus kitchen garden, and did minor repair work (lamps, washer, etc) when she wasn't doing laundry, cooking and general housecleaning.

Well, she had enough of his bitching and one day threw the check book and grocery list down in front of him and said..."If you think you can do it cheaper, fine. You do the grocery shopping. We were so excited when Dad came home. There were chips, cookies and all kinds of things Mom NEVER bought. It was a fiasco. After that, he just handed his check over to Mom

[Demeter]

112. In 4 generations, women managed the finances in our families

I don't know if that means Poles are matriarchal by nature, but it worked....

Supposedly the Japanese women also managed the household--to the point of one cutting and selling her hair to pay the husband's debts...

[Demeter]

86. Dopiest Constitutional Amendment of All Time?

http://capitalgainsandgames.com/blog/bruce-bartlett/2194/dopiest-constitutional-amendment-all-time

Today, all 47 Senate Republicans introduced a constitutional amendment to balance the federal budget. Full text available here. Presumably, this is the amendment that Republicans plan to demand as their price for increasing the federal debt limit. Of course, simply refusing the raise the debt limit would balance the budget overnight -- the nation would default on its debt and we would be plunged into the worst fiscal crisis in history, but the budget would be balanced...

AND HE GOES ON FROM THERE...ENTERTAINING AND EDUCATIONAL. HE CONCLUDES:

What's really worrisome is that the senators are serious about this idiotic amendment, really believe it's a good idea, and will work hard to get it enacted. That's how we ended up with Prohibition.

[AnneD]

103. I say good....

let's take the needle of reality and prick a hole in their inflated ego. Call the bluff. How long do you think this militaristic flag waving will go on once they loose their benefits. Cut education and see how well your snotty nosed grand kids do. Cut the hospital and highway funds and tell me how well your trip to the ER went.

They seem to think that a budget has one side-expenditures. They are about to discover the revenue side of the balance sheet and you can't get blood from a turnip.