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Sun Feb 10, 2013, 09:41 PM

STOCK MARKET WATCH -- Monday, 11 February 2013

STOCK MARKET WATCH, Monday, 11 February 2013


SMW for 8 February 2013

AT THE CLOSING BELL ON 8 February 2013

Dow Jones 13,992.97 +48.92 (0.35%)
S&P 500 1,517.93 +8.54 (0.57%)
Nasdaq 3,193.87 +28.74 (0.91%)


10 Year 1.95% 0.00 (0.00%)
30 Year 3.16% 0.00 (0.00%)









Market Conditions During Trading Hours






Euro, Yen, Loonie, Silver and Gold
















Handy Links - Essential Reading:

Matt Taibi: Secret and Lies of the Bailout





Handy Links - Government Issues:

LegitGov
Open Government
Earmark Database
USA spending.gov





Partial List of Financial Sector Officials Convicted since 1/20/09
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."
8/22/12 Doug Whitman, Whitman Capital LLC hedge fund founder, convicted of insider trading following a trial in which he spent more than two days on the stand telling jurors he was innocent
10/26/12 UPDATE: Former Goldman Sachs director Rajat Gupta sentenced to two years in federal prison. He will, of course, appeal. . .
11/20/12 Hedge fund manager Matthew Martoma charged with insider trading at SAC Capital Advisors, and prosecutors are looking at Martoma's boss, Steven Cohen, for possible involvement.










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.



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Reply STOCK MARKET WATCH -- Monday, 11 February 2013 (Original post)
Tansy_Gold Feb 2013 OP
Demeter Feb 2013 #1
Demeter Feb 2013 #2
Demeter Feb 2013 #3
Fuddnik Feb 2013 #6
Demeter Feb 2013 #7
jtuck004 Feb 2013 #55
Demeter Feb 2013 #56
jtuck004 Feb 2013 #57
Demeter Feb 2013 #58
jtuck004 Feb 2013 #59
Demeter Feb 2013 #4
Demeter Feb 2013 #5
Demeter Feb 2013 #8
Demeter Feb 2013 #9
Demeter Feb 2013 #10
Demeter Feb 2013 #16
Demeter Feb 2013 #23
Demeter Feb 2013 #11
AnneD Feb 2013 #36
bread_and_roses Feb 2013 #40
Demeter Feb 2013 #12
hamerfan Feb 2013 #53
Demeter Feb 2013 #13
Demeter Feb 2013 #14
Demeter Feb 2013 #15
Demeter Feb 2013 #17
Demeter Feb 2013 #18
Demeter Feb 2013 #21
xchrom Feb 2013 #19
xchrom Feb 2013 #22
Demeter Feb 2013 #33
xchrom Feb 2013 #34
Demeter Feb 2013 #37
xchrom Feb 2013 #38
DemReadingDU Feb 2013 #43
AnneD Feb 2013 #39
xchrom Feb 2013 #42
AnneD Feb 2013 #51
xchrom Feb 2013 #52
kickysnana Feb 2013 #41
westerebus Feb 2013 #60
xchrom Feb 2013 #20
xchrom Feb 2013 #24
xchrom Feb 2013 #25
xchrom Feb 2013 #26
xchrom Feb 2013 #27
xchrom Feb 2013 #28
xchrom Feb 2013 #29
xchrom Feb 2013 #30
xchrom Feb 2013 #31
xchrom Feb 2013 #32
Demeter Feb 2013 #35
westerebus Feb 2013 #45
siligut Feb 2013 #54
westerebus Feb 2013 #61
Fuddnik Feb 2013 #44
Demeter Feb 2013 #46
Demeter Feb 2013 #47
Demeter Feb 2013 #49
Demeter Feb 2013 #50
Demeter Feb 2013 #48

Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 06:34 AM

1. It’s Not Easy Being Green By DAVID LEONHARDT

http://www.nytimes.com/2013/02/10/sunday-review/its-not-easy-being-green.html?pagewanted=1&_r=2&

GREEN jobs have long had a whiff of exaggeration to them. The alternative-energy sector may ultimately employ millions of people. But raising the cost of the energy that households and businesses use every day — a necessary effect of helping the climate — is not exactly a recipe for an economic boom.

The stronger argument for a major government response to climate change is the more obvious argument: climate change. The continental United States endured its hottest year on record in 2012, and the planet’s 13 hottest years have all occurred since 1998. Major storms and wildfires are increasing in many regions. The air in much of China resembles soup. The seas are rising faster than forecast only a few years ago, and the costs of extreme weather are rising, too...

AU CONTRAIRE...SEE NEXT POST~

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Response to Demeter (Reply #1)

Mon Feb 11, 2013, 06:37 AM

2. Time to Take Notice: How Renewable Energy Is Becoming Cheaper Than Fossil Fuels By Thom Hartmann

http://www.alternet.org/environment/time-take-notice-how-renewable-energy-becoming-cheaper-fossil-fuels?akid=10039.227380.5W9BLJ&rd=1&src=newsletter792539&t=13&paging=off

Something interesting is happening in Australia. A new study by the research firm Bloomberg New Energy Finance has found that unsubsidized renewable energy is now cheaper than fossil fuels like coal and gas. In fact, it’s a lot cheaper. Data shows that wind farms in Australia can produce energy at AU$80/MWh. Meanwhile, coal plants are producing energy at AU$143/MWh and gas at AU$116/MWh.

Unlike the United States, where energy companies can pollute and have the costs (from illness to environmental degradation) picked up by the taxpayers, Australia has a carbon tax, which partially explains why renewables have a price advantage. But the data shows that even without the cost of carbon tax factored in; wind energy is still 14-cents cheaper than coal and 18-cents cheaper than gas....And, while Australian wind is cheapest now, by 2020 - and maybe sooner - solar power will also be cheaper than coal and gas in Australia. The energy game is rapidly changing in that country....Michael Liebrich, the chief executive of Bloomberg New Energy Finance, noted, “The perception that fossil fuels are cheap and renewables are expensive is now out of date.”

Well, here’s a news flash: That perception has been out of date for a while now – even right here in the United States. According to the Energy Information Administration, looking ahead to 2016, natural gas is the cheapest energy in the United States at roughly $66/MWh. Coal comes in second at $94/MWh. But right behind coal is renewable wind at $97/MWh, which in large part accounts for why U.S. wind energy production has tripled since 2000. And, unlike in Australia, none of those US prices account for the externalities associated with fossil fuels like pollution, cancers, military protection, or global warming. In America, the fossil fuel industry has made sure those externalities are paid for not by the coal and gas energy producers, but instead by you and me...

MORE

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Response to Demeter (Reply #2)

Mon Feb 11, 2013, 07:04 AM

3. America's Housing "Recovery" -- It's Wall St. Buying Homes to Rent Back to Their Former Owners

http://www.alternet.org/occupy-wall-street/ugly-truth-about-americas-housing-recovery-its-wall-st-buying-homes-rent-back?akid=10021.227380.Yz9P-v&rd=1&src=newsletter790532&t=19

...In Georgia, home prices are up 5 percent over last year, a year in which we also had one of the highest foreclosure rates in the country. Seems a little odd, doesn’t it? Don't foreclosures usually drive down the market?...That’s because the housing “recovery,” as they’re calling it, is fueled almost entirely by Wall Street private equity firms, hedge funds and the Fed's unwavering support. After creating a massive bubble in home prices that eventually burst and caused our economy to go into a tailspin, these guys have decided to come back for more, and figured out a way to profit off their destruction -- by turning foreclosed homes into rentals and securitizing the rental income. Many are claiming this is the “private-sector solution” for the recovery we need to get the economy going again. The argument goes that investors snapping up these homes and fixing them up does more for the community than letting the houses just sit there, blighting the neighborhoods and lowering values.

That argument might have made sense for the pilot program Fannie Mae launched last year. In that bulk auction deal, investors had to agree not to sell properties facing foreclosure for a designated period of time. Many of the homes were occupied with tenants, and vacant homes had been on the market and not sold for at least six months. Of course, that deal proved too restrictive for most Wall Street types, leading the sale in Atlanta to eventually fall through.

The Blackstone group, the biggest player in the new REO to rental market, has spent $2.5 billion in the last year purchasing 16,000 homes, a number that amounts to over $100 million per week. Property records show that many of the homes Blackstone has acquired in Fulton County over the last few months were purchased on the courthouse steps at the monthly foreclosure auction, or through short sales—when a lender agrees to accept less than the amount owed on a loan. The vast majority of these homes are not empty, but occupied by homeowners who fell behind during the great recession.

The sale often represents the last nail in the coffin of foreclosure in Georgia, a non-judicial foreclosure state where there is very little opportunity or time to make good once a homeowner falls into default. Blackstone, operating under its subsidiary, THR Georgia, buys the homes for cash, usually at deep discounts from the principle balance owed on the mortgage. Take one of the homes it snapped up at the November auction as an example: THR purchased the Southeast Atlanta home at auction for $90,000. The principle due on the mortgage that was foreclosed upon was $219,300. If banks were willing to offer principle reduction on these inflated mortgages down to the same price they are willing to sell at auction, many homeowners would likely be able to afford their payments, and stay in their homes for years to come, contributing to the stability of the neighborhood. Instead, homeowners get a flier posted on their door the day after Blackstone purchases the home, offering them the opportunity to rent the home they once owned. Meanwhile, the deep pockets of firms like Blackstone allows them to outbid virtually everyone else in the market—eliminating any chance of owner occupants looking for a new home to get a good deal while prices and interest rates are low...

MORE

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Response to Demeter (Reply #3)

Mon Feb 11, 2013, 08:08 AM

6. They claim real estate appreciated by over 8% here last year.

I came back from lunch with a friend from Cleveland a couple of days ago, and a house for sale caught his eye, so we looked it up on line. It's across the street and a few house down. I had looked at it 10 years ago before we bought this place.

It was selling for $40,000 less than I could have bought for 10 years ago.

Recovery indeed.

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Response to Fuddnik (Reply #6)

Mon Feb 11, 2013, 08:13 AM

7. Ten years ago is ten years less inflation and depreciation

maybe not as much of a bargain as it should be.

Condos in this association are rising. Between the amount of capital improvements and the lack of decent cheap housing in the area, that's only to be expected. It's been a busy, had slog. Unfortunately, I may have missed out on the bargains, due to unfortunate timing and family crises....I wanted to get the Younger Kid a unit. Now it may cost money.

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Response to Demeter (Reply #7)

Mon Feb 11, 2013, 04:38 PM

55. >>I may have missed out on the bargains<< Maybe not


We are propping the market up with $40 billion a month in free money to wealthy people, as well as zero percent interest to banks. Banks are withholding inventory from the market, partially by leaving people whose homes will be foreclosed on occupied for 2 years now. Dr Housing Bubble Blog showed one are where there are 3 times as many homes sitting in foreclosure, which, of course, don't show up on the MLS. as there are available to buy. Here.

And if that's not enough, incomes have undergone a massive drop across the country, with tens upon tens of millions who, if they are working, are at 30% less or more of their former income.

All while this administration stands in front of the banks and protects them and their bonuses with cash. But I digress.

It's an artificial market, which everyone seems to think TPTB are smart enough to manage. If one thinks they can float all this until some miraculous recovery occurs then it might be time to consider jumping in. If they can keep it together through 4 or 5 changes in administrations, it might be a good place to park money. We increased unemployment last year, yet the GDP dropped?

If we wind up with further cuts that will eat into an already meager demand, especially without addressing the growing number of people who are still spending assets to just make it, and how our opportunities are being spent overseas, it might be enough to slide into the abyss.

At that point millions who thought today think they are impervious will find out that anyone with debt at that point will be at risk.

So there may be better deals ahead

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Response to jtuck004 (Reply #55)

Mon Feb 11, 2013, 05:31 PM

56. But When? Who will pull the plug?

Remember the Govt. and the Market can stay irrational much longer than most people can stay solvent, and in the meanwhile, we all still need a roof overhead....

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Response to Demeter (Reply #56)

Mon Feb 11, 2013, 10:14 PM

57. I think we may be expecting fireworks while the ground is slowly burning under our feet.


Buying an expensive asset in a time of much that is around it crumbling, in other words.

Watching as we go through 3 decades of exactly what we have today, with a huge potential for more downside and limited upside potential given our current direction. Most all the big stuff is being done outside this country. Instead we have a future of postponed obligations that are sapping opportunity from the majority of people, and being funneled into the pockets of a relative few. Those will likely burst over the next few years, (Post Office, Pensions, Health Care, the constant attack on SS and Medicare, Private Equity failures, ?). Any of them are earth-shaking and profound, and that leaves out environmental changes. Limited opportunities for profit, better for a few that can work together, but nearly everyone is on the menu of the financial folks.

Meanwhile a lot of demand is driving things outside our borders and increasingly without us.

At the end of 30 years that nice asset is surrounded by slightly less than they started with. and without a "plug pulling" it's a completely workable scenario, (keep doing what we are doing <G>. The bankers will be in an even better position than today, better than anyone else, with a continual cycle of buying assets at fire-sale prices, inflating and selling them, reclaiming them as people's rosy scenarios can't be realized (because the bankers are taking too much) and re-inflating them again.

Boy I hope I'm wrong, but I see nothing concrete (that's not full of wishful thinking recalling the past, anyway), to stop it.

It's an exciting time to buy a place though

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Response to jtuck004 (Reply #57)

Mon Feb 11, 2013, 10:33 PM

58. Burning, or Crumbling Away

In either event, one cannot stand in mid-air (unlike Wiley Coyote). It's been desperate for quite a while, pretty soon that will switch to really ugly and violent.

And those banksters can only come out on top if they kill off everyone else. And then, there will be no reason for them to exist. And no means, either.

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Response to Demeter (Reply #58)

Mon Feb 11, 2013, 11:00 PM

59. They can hire half to kill the other, right? Those who are left will pay fees too. <G>


But yeah, you can't just sit, gotta have cover, and one hope it works out.

Having read through quite a bit of 1865-1932, I think business has figured out how to do many of the same things they used to do for profit back when they hired criminals as company guards, used up 6 year old girls (smashed hands, lost fingers, scalps pulled off and dead) in the mills or buried little boys in coal shafts with their brothers and fathers. But now they are not so overt, because lawsuits hurt profits.

Business has found that murdering people is not nearly as profitable as leaving them alive to struggle. They still kill them, but their fingerprints aren't at the scene. I doubt we will descend into anarchy in our lifetime. We have schooled people into being docile, and removed any criticism of much of the system that is killing them. Our result is a bunch of people so docile and democratic about all that opportunity being pocketed by others. I don't think that makes for a secure future.













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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 07:12 AM

4. IOSCO Seeks Tougher Asset Protection to Prevent MF Global Repeat

WHAT DOES A REPORT LIKE THIS TELL US? THAT THE SYSTEMIC RISK IN THE GLOBAL ECONOMY STILL EXISTS, AND MORE THAN LIKELY, IS ABOUT TO SET OFF ANOTHER WORLD-WIDE "EVENT".

http://www.businessweek.com/news/2013-02-08/iosco-seeks-tougher-asset-protection-to-prevent-mf-global-repeat

Banks and investment companies may face tougher scrutiny from regulators over how they safeguard clients’ assets in a bid to prevent any repeat of losses such as those caused by the bankruptcy of MF Global Holdings Ltd.

Global regulators are seeking to address “risks to client assets” held by financial intermediaries and how they should be returned “in default, resolution or insolvency scenarios,” the International Organization of Securities Commissions, said in a statement on its website.

The group, which brings together markets regulators from more than 100 nations, said it has issued guidance to authorities on how to enhance their supervision of so-called financial intermediaries that hold client assets.

MF Global in 2011 filed the eighth-largest U.S. bankruptcy after getting margin calls and bank demands for money at its brokerage following its investment in the debt of troubled European economies. Legal disputes between the U.K. and U.S. units initially tied up assets worth more than $1 billion and hindered repayment of the brokerage’s clients and creditors.

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 07:19 AM

5. China Eclipses U.S. as Biggest Trading Nation Measured in Goods

http://www.bloomberg.com/news/2013-02-09/china-passes-u-s-to-become-the-world-s-biggest-trading-nation.html

China surpassed the U.S. to become the world’s biggest trading nation last year as measured by the sum of exports and imports of goods, official figures from both countries show. U.S. exports and imports of goods last year totaled $3.82 trillion, the U.S. Commerce Department said last week. China’s customs administration reported last month that the country’s trade in goods in 2012 amounted to $3.87 trillion.

China’s growing influence in global commerce threatens to disrupt regional trading blocs as it becomes the most important commercial partner for some countries. Germany may export twice as much to China by the end of the decade as it does to France, estimated Goldman Sachs Group Inc.’s Jim O’Neill.

“For so many countries around the world, China is becoming rapidly the most important bilateral trade partner,” O’Neill, chairman of Goldman Sachs’s asset management division and the economist who bound Brazil to Russia, India and China to form the BRIC investing strategy, said in a telephone interview. “At this kind of pace by the end of the decade many European countries will be doing more individual trade with China than with bilateral partners in Europe.”
U.S. Leadership

When taking into account services, U.S. total trade amounted to $4.93 trillion in 2012, according to the U.S. Bureau of Economic Analysis. The U.S. recorded a surplus in services of $195.3 billion last year and a goods deficit of more than $700 billion, according to BEA figures released Feb. 8. China’s 2012 trade surplus, measured in goods, totaled $231.1 billion. The U.S. economy is also double the size of China’s, according to the World Bank. In 2011, the U.S. gross domestic product reached $15 trillion while China’s totaled $7.3 trillion. China’s National Bureau of Statistics reported Jan. 18 that the country’s nominal gross domestic product in 2012 totaled 51.93 trillion yuan ($8.3 trillion).

“It is remarkable that an economy that is only a fraction of the size of the U.S. economy has a larger trading volume,” Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics in Washington, said in an e-mail. The increase isn’t all the result of an undervalued yuan fueling an export boom, as Chinese imports have grown more rapidly than exports since 2007, he said.

MORE

THERE ARE MULTIPLE MISSING DATA HERE:

CHINA MAY BE EXAGGERATING ITS EXPORT NUMBERS

CHINA IS A HOLLOW NATION, COMPARED TO THE US, WHICH HAS A LARGE DOMESTIC MARKET FOR ITS PRODUCE.

US DATA ISN'T THAT ACCURATE, EITHER.

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 08:31 AM

8. Google’s Schmidt Adopts Plan to Sell as Much as 42% of Shares

GETTING OUT WHILE THE GETTING IS GOOD...

http://www.bloomberg.com/news/2013-02-08/google-s-schmidt-sets-plan-to-sell-as-much-42-of-share-holdings.html

Google Inc. Chairman Eric Schmidt is adopting a plan to sell as many as 3.2 million shares in the operator of the world’s most popular search engine.

The planned share sales, worth about $2.5 billion, are for Schmidt’s individual asset diversification and liquidity, Mountain View, California-based Google said in a filing yesterday with the U.S. Securities and Exchange Commission.

The plan represents 42 percent of Schmidt’s share holdings. He had 7.6 million Class A and B shares as of Dec. 31, and has also adopted separate share sale plans for his investment companies. “This is a routine diversification of assets and Eric remains completely committed to Google,” Niki Fenwick, a spokeswoman for Google, said in an e-mail.

Sales may take place over a maximum period of a year, the filing said. Google rose 1.5 percent to $785.37 at yesterday’s close in New York, leaving them up 11 percent this year.

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 08:35 AM

9. Cracks appear in European banking union scheme MUST READ

BECAUSE NOBODY BENEFITS, NO DOUBT. NOT EVEN ORDINARY PEOPLE.

http://www.reuters.com/article/2013/02/08/us-eu-ecb-supervision-idUSBRE9170GX20130208

It was billed as a reform that would tighten policing of Europe's banks and end their ability to suck states into crisis. Now fears are growing that a central element of banking union will be scaled back, undermining the whole scheme. When it takes the role of watchdog for euro zone banks in March next year, the European Central Bank will be confronted with a financial system that is still limping. In some countries, such as Cyprus and Spain, it is in critical condition.

Setting up a fund and agency that, where needed, would shut weak banks - known as 'resolution' - is central to this ECB-led union because it would remove the onus on countries like Ireland to save failing banks alone, running up bills that overwhelm the state. Yet the political drive to complete banking union is waning, with the reluctance of Germany and other economically-strong countries to put themselves on the line for bad loans made in Spain and elsewhere coming back to the fore. "It's unrealistic to expect that we will have a resolution authority or resolution fund in time for the new ECB bank supervision in March 2014," said Sharon Bowles, an influential EU lawmaker who will help shape the new regime. "That means that if there is a problem, it lands back at the national authorities," said Bowles, who chairs the European Parliament's economic and monetary affairs committee.

The problem is simple. "A resolution fund ... is the beginning of (debt) mutualisation and the Germans don't want to go there," said one EU official, pointing to a creeping complacency among politicians since the ECB defused market tensions. "It's a very tall order to get it completed by the end of the year."


German national elections in September exacerbate the issue. "Germany will not commit to anything before the elections," said Martin Lueck, an economist at UBS, adding that he was nonetheless cautiously optimistic that a deal could be reached afterwards. Such a delay would bode ill for the ECB, the euro zone's bulwark against another markets storm. The central bank, which is propping up hundreds of banks across Europe with cheap loans, is growing nervous...

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Response to Demeter (Reply #9)

Mon Feb 11, 2013, 08:38 AM

10. EU's Rehn wants closer currency coordination

AND A PONY. GOES WITHOUT SAYING

http://uk.reuters.com/article/2013/02/09/uk-europe-currency-rehn-idUKBRE91803A20130209

The European Union's top monetary official wants closer coordination on currencies to avoid potentially damaging disruptions to world trade, he told an Austrian magazine. The remarks by Economic and Monetary Affairs Commissioner Olli Rehn come amid a standoff between France and Germany over whether a strengthening euro needs an official European response or whether markets should be left to set exchange rates.

Germany said this week the strong euro was not a concern and signalled opposition to a French proposal for a mid-term target rate, exposing policy divisions over mainland Europe's currency between its top two economies. The European Central Bank will monitor the economic impact of a strengthening euro, ECB President Mario Draghi said on Thursday, feeding expectations the climbing currency could open the door to an interest rate cut.

"I recognise the risk of competitive devaluation. We have recently warned the government of Japan about corresponding steps towards depreciation of the yen," Rehn told Profil magazine in an interview published on Saturday.

"We need reforms in the international monetary system so as to avoid negative influences on international trade. The coordination within the G7, G20 or the IMF should therefore be improved," he added, referring to policy-setting groups of leading nations and the International Monetary Fund.

Rehn said a stronger euro would be very harmful mainly for the southern euro zone countries, while Germany, Austria, the Netherlands and Finland could handle this. "But the southern countries would have problems with their exports to other parts of the world," he said.

On other subjects, Rehn said the "horror scenario" of a euro zone collapse was gone but urged members of the currency bloc to press ahead with fiscal consolidation and structural reforms....

SURE IT HAS....THE NEW GRIMM'S FAIRY TALE

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Response to Demeter (Reply #10)

Mon Feb 11, 2013, 09:04 AM

16. EU agrees new derivatives rules, stalls again on bank capital

http://www.reuters.com/article/2013/02/07/eu-regulation-idUSL5N0B75E620130207

European Union lawmakers pressed ahead with new rules for derivatives on Thursday, helping the bloc meet one global pledge to make markets safer as it struggles to meet another on raising bank capital levels to diminish risk. The European Parliament, meeting in Strasbourg, France, decided not to proceed with a resolution which, if passed, would have forced regulators to rethink long-awaited derivatives regulation, triggering delay and uncertainty for markets.

EU financial services commissioner, Michel Barnier, said the new rules, which say derivatives trading contracts must be cleared and recorded, can now come into force, most likely mid-March. Currently most derivatives transactions are not cleared and there is no snapshot of trades to see who is exposed, potentially creating huge uncertainties. "By adopting these standards the EU meets its G20 commitment in the context of the reform of financial services. The new rules will reduce the risks related to derivative transactions," Barnier said in a statement.

The resolution had been brought by lawmakers seeking support for companies who use derivatives to insure against adverse raw material prices. Kay Swinburne, a British centre-right member wanting amendments, said the commission had agreed to provide guidance to those firms to help them avoid compliance costs.

Barnier now needs the United States to accept that the new rules are as strict as their own. This would mean that EU-based firms who do business in America would not have to comply with U.S. rules as well...

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Response to Demeter (Reply #16)

Mon Feb 11, 2013, 09:24 AM

23. Eurobond 50th Anniversary Shows Tobin Tax Risks: Euro Credit

http://www.bloomberg.com/news/2013-02-04/eurobond-50th-anniversary-shows-tobin-tax-risks-euro-credit.html

Half a century after a U.S. tax on bond purchases spawned the $3.7 trillion-a-year Eurobond market, Europe’s plan to impose a levy on financial transactions risks triggering a similar flight.

Against the objections of nations including the U.K. and Luxembourg, European Union finance ministers agreed Jan. 22 that interested member states may design a broad-based tax that would cover trades in stocks, bonds, derivatives and other securities. The EU estimates the proposal would allow France, Germany and nine other countries to raise as much as $47 billion a year.

“What’ll happen is what has always happened,” said Jim Kean, founder of investment advisory firm Bayesic Asset Management Ltd. in London, who started as a bond trader in 1986, a year before Margaret Thatcher’s “Big Bang” deregulation of the U.K. ushered in liberalized financial markets. “If you can transact without transaction costs, you will. There’ll be a market in Singapore or somewhere else.”

Europe’s plans have been dubbed a Tobin tax after U.S. economist James Tobin, who in 1972 suggested taking a cut of foreign-exchange trades to limit currency speculation. History is littered with government attempts to extract revenue from financial transactions, not all of which were successful and most of which had unintended consequences...The Eurobond market, now the largest forum for corporate fixed-income transactions, came into being after President John F. Kennedy imposed a so-called interest-equalization tax in 1963 to make investing in foreign securities less alluring to U.S. investors and ease a balance of payments deficit...MORE

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 08:39 AM

11. Everyone Ready for the State of the Union Speech tomorrow?

I haven't got nearly enough wine...

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Response to Demeter (Reply #11)

Mon Feb 11, 2013, 10:31 AM

36. don't worry Demeter....

I have enough 'whine' for everyone.

And a special thanks to the loves that gave me the hearts. You are a dear!

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Response to Demeter (Reply #11)

Mon Feb 11, 2013, 11:11 AM

40. The world is too much with me already ...

... the SOTU farce is quite beyond my powers of self-discipline, which are not too strong to begin with and quail utterly in the face of enduring POTUS Mellifluous Drone.

I'll just keep apologizing for being among the missing until I have more time ... do at least scan the headers almost every day to see what the latest nefariousness is. So glad you are all holding the line!

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 08:47 AM

12. Goldman Readies Fund Business for 'Volcker'

http://online.wsj.com/article/SB10001424127887324906004578290090306107284.html?mod=dist_smartbrief

Goldman Sachs Group Inc. is going to have a tougher time milking one of its most-lucrative cash cows. For 20 years, Goldman wooed clients to invest in its private-equity funds with the security blanket that the bank and its partners went along for the same ride. But that is about to change. The looming "Volcker rule" is expected to sharply reduce the bank's investment in its own funds. That is forcing Goldman to make major changes in a $50 billion business that has reaped big profits for the bank and its employees and clients. Goldman likely will have to shrink the size of its own investment in its funds to just 3% from as much as 37% once the rule is finalized later this summer. The rule, part of the Dodd-Frank financial-overhaul law and named after former Federal Reserve Chairman Paul Volcker, aims to restrict banks from making big bets with their own money. Goldman expects new funds it raises will be considerably smaller. The New York bank also will change the name of the business to avoid referencing its own name. GS Capital Partners and future funds may become "Broad Street," referring to both the firm's old headquarters and its first leveraged-buyout fund launched in 1986, according to people involved in the business.

Goldman isn't alone in shrinking its private-equity business. Bank of America Corp. has decided to exit the private-equity business, according to a spokeswoman, and Citigroup Inc. is exploring several options for its private-equity funds after paring back its stakes in hedge funds, a spokeswoman said.

The private-equity industry overall has taken a hit since the financial crisis. Investors have become more cautious about putting their money into private-equity funds after buyouts dried up and investments locked up in funds didn't deliver the double-digit returns they expected. Corporate takeover activity has picked up, making such funds potentially more attractive, but not to the frothy levels seen a decade ago.

Goldman officials say the company remains committed to the private-equity business despite the upheaval and speculation that it might do away with it. Executives have said the Volcker rule doesn't "materially" impact its potential for returns in its investing and lending businesses. Goldman doesn't specify how much it earns from its private-equity business. Goldman is holding clients' hands to reassure them it is the same lucrative business it always was. The head of Goldman's merchant banking unit, Richard Friedman, is promising clients in upcoming funds that he will stick around or allow the investors to back out of deals—a standard industry contractual obligation known as the a "key man provision." He and other bankers also are providing details of how much money they are putting in to reassure investors Goldman still has skin in the game...MORE

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Response to Demeter (Reply #12)

Mon Feb 11, 2013, 02:40 PM

53. AppleCEO to speak at GS tech conference to morrow

Apple CEO Tim Cook will speak at the Goldman Sachs Technology and Internet Conference for the second year in a row. Cook spoke a year ago at the conference and made a number of interesting statements about the tablet market, Apple’s growth and its worker responsibility policies.

Apple will present the event live, via an audio-only stream.

One of the big questions related to the iPhone posed at last year’s conference was whether Cook felt that the iPhone would succumb to the ‘law of large numbers’, meaning that perhaps the market for the product would diminish. Cook addressed offering these devices in areas like China, Brazil and other locations where the subsidy model simply didn’t work.

“We want to focus on…making the world’s best product…the paramount thing is the product, it is the focus,” said Cook.

Recent rumors have placed a ‘more affordable’ iPhone on Apple’s list of possible upcoming products. A product like this would alleviate the low-end pressures in areas where subsidy was not viable.

http://thenextweb.com/apple/2013/02/11/apple-ceo-tim-cook-to-speak-at-goldman-sachs-tech-conference-on-feb-12th/

I knew I was falling out of love with Apple....

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 08:55 AM

13. The Fed Gets a Bubble Cop

http://dealbook.nytimes.com/2013/02/07/the-fed-gets-a-bubble-cop/

Watch out, Wall Street. The Federal Reserve, a primary banking regulator, is trying harder to spot speculative excesses...In a speech on Thursday, Jeremy C. Stein, who joined the Fed's board of governors last year, focused on parts of the financial markets that show signs of overheating. He went into considerable detail, citing metrics that appear designed to spot bubbles. Specifically, Mr. Stein raised a red flag about junk bonds and mortgage-backed securities, and how investors are financing their purchases of such assets. Wall Street has often been a facilitator of bubbles, and in their formation, financiers find plenty of seemingly sound justifications for strongly rising asset prices.

Of course, the Fed is against rampant speculation weakening the banks and distorting the wider economy. But central bank officials say they do not want to take tough action like raising interest rates to stamp out speculation in specific asset classes, because such a response may unnecessarily cool large sectors of the real economy that are not frothy.

Testifying before the Financial Crisis Inquiry Commission in 2010, the Fed chairman, Ben S. Bernanke, explained why, in the middle of the last decade, the central bank did not raise interest rates to stifle what appeared to be an overheating housing market.

"Monetary policy is a blunt tool," he said. "Raising the general level of interest rates to manage a single asset price would undoubtedly have had large side effects on other assets and sectors of the economy."


But that stance carries a big risk. What if the Fed fails to spot when localized speculation has tipped into something much more dangerous? Mr. Stein's speech shows that the Fed wants to get better at making that distinction. First, he says, after many months of extremely low interest rates, there are signs of frothiness. He sees it especially in junk bonds and securities backed with mortgages. Mr. Stein takes things a step further, though. He addresses those parts of the market infrastructure that could magnify the pain caused by a potential sell-off in such bonds. In particular, he focused on the link between short-term borrowing and bond purchases. Financial firms take out short-term loans and use that money to buy longer-term, higher-yielding assets. But in jittery times, short-term loans stop becoming available. Investors then have to sell the longer-term assets financed with the short-term debt. On a broad scale, this can cause vicious declines in longer-term assets, and paralysis across the system if the selling turns into a panic. The Fed, therefore, has to make sure that investors are not using too much of this short-term debt. Mr. Stein notes with approval that Wall Street firms are using less short-term borrowing to finance their vast inventories of bonds. But he also recognizes that disorderly selling of bonds could come from another source, like exchange-traded funds.

"If investors in these vehicles seek to withdraw at the first sign of trouble, then this demandable equity will have the same fire-sale-generating properties as short-term debt," he said.


Mr. Stein singles out a sector that has recently grown a lot - the investment funds that buy government-backed mortgages. They use repo loans to finance their investments. As of the fall, these real-estate investment trusts, or REITs, had nearly $400 billion of assets, up from around $150 billion at the end of 2010, Mr. Stein said. If repo costs go up and the mortgage bonds fall in price, the funds could suffer. Industry analysts who cover such trusts are not worried, however. Even after their growth, the trusts represent only a small portion of the overall market for mortgage-backed bonds, says Bill Carcache, analyst at Nomura. He also said the trusts do not use an excessive amount of borrowed money. "Leverage levels are very comfortable," he said.

MORE ALARMS AND EXCURSIONS AT LINK

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 09:00 AM

14. S&P as Sole U.S. Target Has Wall Street Asking About Moody’s

http://www.bloomberg.com/news/2013-02-08/s-p-as-sole-justice-target-has-wall-street-asking-about-moody-s.html

The Justice Department decision to sue Standard & Poor’s has investors asking why Moody’s Investors Service and Fitch Ratings weren’t targeted for awarding the same top grades to troubled mortgage bonds and other debt securities.

“What purpose does it serve for the U.S. government to bring an action against S&P at this point in time? On the surface, is this a bid for some sort of retribution” for the company’s 2011 downgrade of the U.S., Bonnie Baha, head of global developed credit at Los Angeles based DoubleLine Capital LP, which oversees about $53 billion, said in a telephone interview yesterday. “Moody’s and Fitch assigned the same ratings to these transactions. Why aren’t they named as well?”


The Financial Crisis Inquiry Commission and a Senate panel laid the blame on S&P, Moody’s and Fitch for inflated ratings on mortgage-backed securities and collateralized debt obligations that helped cause the worst financial crisis since the Great Depression. Together, they provided 96 percent of all ratings for governments and companies in the $42 trillion debt market in 2011. The U.S., in a lawsuit filed Feb. 4 in federal court in Los Angeles, is alleging that the unit of New York-based McGraw-Hill Cos. defrauded investors by failing to adjust its analytical models or taking necessary steps to accurately reflect the risks of the securities because it was afraid of losing business.

S&P lowered the U.S. government’s credit rating one step to AA+ from the top AAA rank on Aug. 5, 2011, after months of wrangling between President Barack Obama and Congressional Republicans over whether to raise the federal debt limit. Bond investors repudiated the downgrade and U.S. borrowing costs fell to record lows as Treasuries gained the most since 2008.

...Wallison said the largest shareholder in Moody’s is Warren Buffett’s Berkshire Hathaway Inc. Buffett is an Obama supporter and his name is associated with a proposal to raises taxes on the wealthiest Americans promoted by the administration....

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Response to Demeter (Reply #14)

Mon Feb 11, 2013, 09:02 AM

15. NY attorney general probing three major rating firms

http://www.reuters.com/article/2013/02/08/nyattorneygeneral-creditratingprobe-idUSL4N0B816920130208

New York Attorney General Eric Schneiderman has kicked off an investigation into three major credit ratings agencies, according to a person familiar with the matter, a move that follows the U.S. Justice Department's $5 billion lawsuit against Standard & Poor's over pre-crisis mortgage bond ratings.

Schneiderman issued a subpoena to Standard & Poor's this week, a person familiar with the matter told Reuters. S&P is a unit of The McGraw Hill Cos. His office also sent formal requests for information to two other major credit rating agencies, Moody's and Fitch Ratings, the person said.

Schneiderman is seeking information related to the agencies' conduct in rating mortgage-backed securities and whether the companies abided by agreements in 2008 to make certain reforms, according to the person.

The 2008 agreements, signed by the three firms, settled an earlier probe by the New York attorney general's office of the firms' ratings of residential mortgage-backed securities leading up to the financial crisis....MORE

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 09:06 AM

17. Einhorn sues Apple, marks biggest investor challenge in years

http://www.reuters.com/article/2013/02/07/us-apple-greenlight-idUSBRE9160MI20130207

Apple Inc on Thursday confronted its first major challenge from an activist shareholder in years as hedge fund manager David Einhorn's Greenlight Capital filed suit against the company and demanded that it dole out a bigger piece of its $137 billion cash pile to investors.

The unusual move comes as the world's largest technology company grapples with a tumbling share price, mounting competition in the smartphone and tablet markets, and concerns about its ability to produce new breakthrough products.

Einhorn, a well-known short-seller, said in an interview with CNBC that Apple had a "Depression-era" mentality that led it to hoard cash and invest only in the safest, lowest-yielding securities.

Apple nearly went broke in the 1990s before Steve Jobs returned and engineered a sensational turnaround, with products such as the iPhone and iPad that became must-haves for consumers around the world. The company's near-death experience has led Apple to be exceptionally conservative with its cash...

MORE

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Response to Tansy_Gold (Original post)

Mon Feb 11, 2013, 09:16 AM

18. American, US Airways move closer to a deal

An announcement of a merger between American Airlines and US Airways could come early next week as the two sides move closer to completing the final details of a deal, sources familiar with the deal said.

It appears US Airways chief executive Doug Parker will lead the merged carrier while AMR chief executive Tom Horton will stay on as a non-executive chairman for a specific period of time, a source familiar with the deal said Wednesday.

Creditors and bondholders at AMR have also decided on the equity split, the sources said; however, they cautioned that discussions were still ongoing and items could change.

According to The Wall Street Journal, American creditors would own about 72 percent of the airline and US Airways shareholders about 28 percent, although those figures are still being discussed...

Read more here: http://blogs.star-telegram.com/sky_talk/2013/02/american-us-airways-move-closer-to-a-deal.html#storylink=cpy

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Response to Demeter (Reply #18)

Mon Feb 11, 2013, 09:21 AM

21. Perkins on travel: If US Air, American merge, consumers will lose out

http://www.mercurynews.com/travel/ci_22536019/perkins-travel-if-us-air-american-merge-consumers

The merger of American Airlines and US Air is a done deal, claims most of the trade press; it's just a matter of time and working around a few ego barriers...Certainly, most of the "stakeholders" seem to want it, including US Airways, the main airline workers' unions, Wall Street and creditors. In fact, the only significant stakeholders who aren't on the bandwagon are the federal government agencies that would have to approve a merger, the current American management team, and the consumers who will face the consequences.

Why the suspense? Even though US Airways is the smaller of the two lines, everyone expects that the US Airways management team will mostly run the combined operation. And the self-proclaimed industry "insiders" say the remaining barrier is bruised ego in American's executive office. That's certainly credible: Over the years, I've seen lots of important corporate decisions based on where the CEO's spouse wants to live or other equally trivial requirements. But the larger question is what will happen to consumers if the merger goes ahead, since now that possibility is likelier than ever. All in all, my take is that the merger would do more harm than good:

  • Despite industry blather about "increased scope" of a merged line, the main effect would be lessened overall competition. Certainly, a merged line could take you more places than either line could, separately. But the merged line isn't likely to be able to take many of you places you can't already reach on at least one of the legacy lines.

  • Even though we haven't suffered a big airline strike in recent years, a work stoppage at the combined line would be far worse than a stoppage at either of the two separate lines.

  • US Airways' current policies and practices are generally anti-consumer. It is not at all innovative and it follows a strategy of gouging travelers to/from its major hubs. If the US Airways team does, in fact, control the merged outfit, you'll suffer.

  • The combined line will retain the "American" name but be governed mainly by the US Airways management team.

  • Even though maintaining major hubs as close together as New York, Philadelphia, and Washington seems to make little sense, the merged line couldn't consolidate them: None of those airports can handle much more traffic. And American's Chicago and Dallas-Fort Worth hubs and US Airways' Charlotte and Phoenix hubs look like they'll remain as is for some time.

  • The combined line would almost surely merge frequent-flier programs, combining your mileage credit and retaining your elite status in either. It's likely, however, that, using the merger as an excuse, the combined line will move the program in the direction Delta has already taken of basing elite status on a combination of the miles you fly and the money you spend.

  • The combined line will probably retain American's membership in the Oneworld alliance, along with the various partner-line benefits of that alliance. The downside to that is that British Airways, the most important partner, gouges frequent fliers by adding stiff fuel surcharges to award trips.

  • The combined line would probably begin divorce proceedings from Star Alliance and code-sharing with United. If you prefer to remain with Star Alliance, you might get some time to use your accumulated miles and possibly the opportunity to transfer miles into United's program or that of some other Star Alliance member.

  • You will certainly retain both lines' lounge club memberships, but sooner or later lose Star Alliance reciprocity.

  • American's credit cards are Citibank/MasterCards and US Airways cards are Barclaycard/MasterCards. The combined line could go either way exclusively, but it's also possible that both card breeds will remain active for the foreseeable future.

    That, then, seems to be the consumer effect. Minor changes now, bigger changes later, less competition, and generally anti-consumer fare and product policies. All in all, Wall Street gains, you lose. Surely you aren't surprised.
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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:17 AM

    19. LOOK INTO MY EYES...

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    Response to xchrom (Reply #19)

    Mon Feb 11, 2013, 09:23 AM

    22. you will buy me this handbag - which i adore

    http://www.bloomberg.com/news/2013-02-10/hermes-10-000-birkin-purse-seen-leading-to-record-sales-retail.html

    Hermes $10,000 Birkin Purse Seen Leading to Record Sales


    Hermes bags are seen on display in a store window, the company is operated by Hermes International SCA in Paris.

    For decades, fashionistas have known that a Birkin bag is a safe style bet -- if you can get your hands on one. That demand makes its producer, Hermes International SCA, the surest bet in the luxury industry when it comes to sales growth.

    With waiting lists that can run more than a year for a $10,000 purse, demand for Hermes handbags shows how the Paris- based company, which analysts estimate will report record revenue tomorrow, is capable of determining its own financial performance.

    Unlike LVMH Moet Hennessy Louis Vuitton SA, which last month reported stagnant revenue growth at its fashion and leather-goods unit, Hermes sales are constrained mainly by manufacturing capacity and the brand’s own desire to remain exclusive. While the industry will struggle to accelerate growth this year, sales at the very highest end of luxury -- Hermes’s domain -- are forecast to outperform the rest. That leaves Hermes well-placed to meet estimates with its stable of classic and coveted designs.

    “The limit to what Hermes sells is how much it can produce,” said Luca Solca, an analyst who heads luxury-goods research at Exane BNP Paribas in London. Revenue “is what they decide it’s going to be.”

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    Response to xchrom (Reply #22)

    Mon Feb 11, 2013, 10:21 AM

    33. This is my bag--in denim blue (also have a tomato red)



    It does everything and makes a good weapon/pillow in an emergency

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    Response to Demeter (Reply #33)

    Mon Feb 11, 2013, 10:23 AM

    34. ooooh = i like that. what is that? nt

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    Response to xchrom (Reply #34)

    Mon Feb 11, 2013, 10:36 AM

    37. Ameribag

    https://www.facebook.com/AmeriBag

    Not only ergonomic, but there's pouches and pockets to keep stuff from getting jumbled and lost.

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    Response to Demeter (Reply #37)

    Mon Feb 11, 2013, 10:39 AM

    38. really nice. nt

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    Response to Demeter (Reply #37)

    Mon Feb 11, 2013, 11:21 AM

    43. I have a couple of Ameribags


    A nice leather one, and a bright red one!
    I think I need a larger demin washable one.




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    Response to xchrom (Reply #34)

    Mon Feb 11, 2013, 10:49 AM

    39. Tear drop mono sling purse....

    Victorinox makes them although I have a black and a brown pair made by someone else packed away. It is my bag of choice when traveling. I think I will go for a leather one next for daily wear. It is very comfortable and holds enough stuff that you can live out of your bag on a deserted island for at least a couple of weeks (or be stuck in an airport terminal for a few days).

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    Response to AnneD (Reply #39)

    Mon Feb 11, 2013, 11:17 AM

    42. I love that it's organized. & can used for travel. Nt

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    Response to xchrom (Reply #42)

    Mon Feb 11, 2013, 01:27 PM

    51. I take my older purse....

    on travels, that way I am not too upset if it is lost or stolen. When I travel, I am sure some people look at me and try to figure out how I got the money to travel.

    I also pack light. I did 6 weeks in Europe with a carry on. Boy, did I plan the wardrobe for that one (as much thought as went into packing). Wore the bulky stuff on the plane (trench coat, scarf that doubled for a wrap, sweater, skirt, white long sleeve shirt, leggings, heavy walking shoes), purse packed to capacity. I did buy a small cheap rolling bag that was empty going to Europe and filled with souvenirs on the way back.

    Hubby claims to be a world traveler (and he is) but he can't pack for shit. Daughter is always amazed when we unpacked. She says I don't need Hermione's handbag or magic.

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    Response to AnneD (Reply #51)

    Mon Feb 11, 2013, 01:42 PM

    52. Girl - I guess it won't surprise you I over pack? Nt

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    Response to Demeter (Reply #33)

    Mon Feb 11, 2013, 11:12 AM

    41. Caught about 30 seconds of Peyton Place this weekend.

    Guy and gal in a red Convertible at lovers lane, dressed to the eights. He kisses her she goes down willingly reaches for her gold sequined bag and hits him upside the head, gives him a lecture about leaving with the girl he came with, and quickly walks away.

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    Response to xchrom (Reply #22)

    Tue Feb 12, 2013, 01:06 AM

    60. Don't know about the purse.

    But, the x-wife kept the Hermes saddle I bought for our first wedding anniversary.

    Three thousand comes to mind.

    Beval's Saddlery in Gladstone, N.J.

    Those were some good times.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:18 AM

    20. Euro Ministers Seek New Crisis Momentum as Unrest Returns

    http://www.bloomberg.com/news/2013-02-10/euro-ministers-seek-new-crisis-momentum-as-unrest-returns.html

    European finance chiefs will seek to win back crisis-management momentum to navigate through emerging political pitfalls after markets signaled last week that the three-year crisis is far from over.

    Ministers from the 17-member euro area meet in Brussels today to discuss aid to Cyprus and Greece as a tightening election contest in Italy and a political scandal in Spain disrupt market calm. Group of 20 finance chiefs and central bankers will gather in Moscow Feb. 15-16.

    “We don’t know yet how we’re going to get out of the crisis,” Wolfgang Franz, the chairman of Chancellor Angela Merkel’s council of economic advisers, told Welt am Sonntag. “If the crisis is a marathon, we’ve got two-thirds of the course behind us. But the last third is always the hardest.”

    European Union leaders who last week reached a seven-year budget agreement that for the first time cuts spending will look ahead to Italy’s Feb. 24-25 elections as polls show the vote might fail to deliver a governing majority. European stocks last week posted a second weekly drop as investor concern about policy roadblocks in Italy and Spain revived.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:26 AM

    24. Fed Joining in Alarm Over Distortion It Enabled: Credit Markets

    http://www.bloomberg.com/news/2013-02-11/fed-joining-in-alarm-over-distortion-it-enabled-credit-markets.html

    A Federal Reserve governor is joining those warning that junk-debt investors are poised for losses, while his institution’s policies spur them to keep buying the debt.

    Yields on a record 38 percent of the $1.1 trillion of notes sold by the neediest U.S. borrowers were trading below the 10- year average rate for investment-grade debentures last month, Barclays Plc data show. Investors poured a record $1.3 billion into U.S. leveraged loan funds last week as covenants on the debt weaken the most ever.

    The central bank’s policy of keeping benchmark borrowing costs at about zero for a fifth year is pushing investors into riskier debt, even as Fed Governor Jeremy Stein warns that the market for speculative-grade debt may be overheating. While U.S. prosecutors are suing Standard & Poor’s with deliberately failing to provide warnings against losses on collateralized debt obligations before the credit crisis, the government’s stimulus is fueling demand for similar products now.

    “No matter how loud the chorus gets that this is crazy, the bulls are going to continue to run because there’s nowhere else to put money in fixed income,” said David Tawil, the co- founder of Maglan Capital LP, a distressed-debt hedge fund that manages about $50 million. “If I’m saying now that the deals are getting laughable, if things don’t change, six months from now the deals are going to be stupid.”

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:29 AM

    25. Spanish Deficit Haunts Rajoy Defying Junk Status

    http://www.bloomberg.com/news/2013-02-11/spanish-deficit-haunts-rajoy-defying-junk-status.html

    Spanish Prime Minister Mariano Rajoy’s results from his first year in office are about to get a close inspection by credit rating companies and investors.
    “Spain’s budget deficit numbers are crucial,” said Harvinder Sian, a senior fixed-income strategist at Royal Bank of Scotland Group Plc in London, in a telephone interview. “A number near and certainly above 8 percent of gross domestic product in 2012 will raise the risk of a ratings downgrade, and while we expect near 7.5 percent, the regions have delivered late surprises in the last couple of years.”

    With suspense on the deficit persisting, Rajoy will deliver a speech tomorrow in Madrid where he may defend the five rounds of spending cuts and tax increases inflicted on Spain last year. That austerity still failed to bring the shortfall below the European Commission’s target and the government might need to step up efforts to avoid missing its goal this year too.
    Deficit data due this month will show how far the government reduced its budget shortfall in 2012, a year when Spain came close to needing a bailout. While 10-year borrowing costs are down more than 200 basis points from their July peak, two ratings companies grade Spanish bonds one level above junk and another cut may make them too risky for some investors.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:31 AM

    26. Autonomy faces probe by Financial Reporting Council

    http://www.bbc.co.uk/news/business-21413216

    The British software group Autonomy is to be investigated by the UK's accountancy watchdog.

    The Financial Reporting Council (FRC) is examining the firm's reporting for the period of January 2009 to June 2011, the three months before it was bought by the US firm HP.

    HP last year accused Autonomy of inflating its value by $5bn (£3bn).

    A spokesman for the former management at Autonomy "welcomed" the investigation.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:32 AM

    27. Euro rises as finance ministers meet

    http://www.bbc.co.uk/news/business-21408533

    The euro has jumped against the British pound and the Japanese yen.

    The move comes as France prepares to voice concerns about the strength of the euro at a meeting of eurozone finance ministers in Brussels.

    French Finance Minister Pierre Moscovici is worried that the rising single currency is making the country's goods less competitive.

    The euro has risen by 6% against a basket of other currencies in the past six months.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 09:35 AM

    28. Venezuela devalues currency by 32% against the dollar

    http://www.bbc.co.uk/news/world-latin-america-21391984

    Venezuela has cut the value of its currency against the US dollar by 32%, in an effort to boost its economy.

    The widely expected measure ramps up the official exchange rate of the bolivar from 4.3 to 6.3 per US dollar.

    It was announced after Vice-President Nicolas Maduro's return from Cuba, where he said President Hugo Chavez gave him instructions on the economy.

    The leader has not been seen or heard in public since December, when he went to Havana for cancer treatment.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 10:07 AM

    29. Calls for Cheap Euro: ECB Caught in Currency-War Crossfire

    http://www.spiegel.de/international/business/ecb-resisting-calls-to-cheapen-euro-as-currency-war-rages-a-882462.html

    Billionaire investor George Soros and French President François Hollande, a Socialist, are in agreement: The world is on the verge of a currency war, and it threatens to destroy Europe.

    The Europeans should finally enter the fray and do battle with all their might, says Soros, who made some of his fortune by betting against the British pound. "Europe is an outsider," the 82-year-old recently said at the Davos World Economic Forum. He blamed the European Central Bank (ECB), which he called the last representative of an outdated central bank policy.
    Hollande doesn't put it as clearly, but he means the same thing. "A currency zone must have an exchange rate policy, or it will end up with an exchange rate that doesn't correspond to the actual state of its economy," the Socialist told the European Parliament in Strasbourg last week.

    These remarks were intended for Mario Draghi, the president of the Frankfurt-based ECB. Hollande's message is that he should protect the euro's exchange rate. The central bank chief is coming under increasing pressure because he can't quite bring himself to embrace the concept of quantitative easing, the latest fashion in the world of finance. It involves central bankers engaging in the large-scale purchase of bonds issued by their governments and other securities, thereby injecting huge sums of money into the financial system. In this way, they hope to stimulate the domestic economy and keep their own currencies cheap, thereby strengthening exports. Soros believes that this is the only way countries can grow out of their large debts.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 10:10 AM

    30. The Viennese Swamp: Corruption and Attacks Mark Austrian Election Year

    http://www.spiegel.de/international/europe/election-year-in-austria-kicks-off-with-scandal-and-absurdities-a-882615.html


    Carinthia, the state in southern Austria, is in the grip of a group of political leaders who are just as bad as some of the worst dictators and war criminals recent history has produced. That, at least, is the message delivered by an advertisement recently created by the right-wing populist party Alliance for the Future of Austria (BZÖ).

    The ad, developed to be shown primarily in movie theaters ahead of a regional election in March, is called "Path to Freedom" and it portrays state political leaders interspersed with images of a handful of well-known dictators, including Romania's Nicolae Ceausescu, Slobodan Milosovic of Serbia, East German leader Erich Honecker and the recently deposed Egyptian autocrat Hosni Mubarak.
    "The time has come for us too," the ad intones. "Now!" It ends with an image of the famous raising of the US flag on the island of Iwo Jima in World War II. Instead of the American flag, however, the soldiers are raising the gold, red and white flag of Carinthia. "Free Carinthia on March 3, 2013," is the final message.

    The advertisement is nothing if not overwrought. But as Austrians prepare for a quartet of state elections this year in addition to the general election set for September, its shrillness demonstrates the degree to which politics in the country has decayed in recent years. Rocked by a burlesque series of scandals and an ongoing -- and increasingly absurd -- power struggle among right-wing populist parties, the campaigns promise to be tasteless in the extreme.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 10:14 AM

    31. Banana republic or first world country? Welcome to Britain in 2013, Mr Carney

    http://www.guardian.co.uk/business/economics-blog/2013/feb/10/mark-carney-bank-governor


    Mark Carney, the new governor of the Bank of England, answers questions from the Treasury select committee. Photograph: Pool/Reuters

    It was just a normal week. A bank that is 80% state owned was fined a packet for rigging the financial markets. Supermarket shelves were stripped because the beef in lasagne was horsemeat. A report detailed appalling care and neglect at an NHS trust that resulted in the needless deaths of hundreds of patients.

    While all this was going on, Mark Carney, governor of the Bank of England designate, arrived in town to be given the once over by the Treasury select committee. He could have been forgiven for asking whether this was a banana republic rather than a supposed first world country.

    At least Carney is in the reassuring position of suspecting that the only way is up. After two years of zero growth and half way through a lost decade of falling living standards, expectations are at rock bottom. Not since the late 1970s and early 1980s – a period of high inflation, industrial unrest and rising unemployment – has the national economic mood been so gloomy.

    In the short term at least, the pessimism is overdone. There is no hard data as yet, but all the survey evidence suggests Britain will avoid a triple dip recession. Growth will return in the first three months of 2013 and continue for the rest of the year. Underlying activity was just about positive from April to December 2012 once all the special factors are accounted for, and the latest surveys for mortgage demand, manufacturing and services all point to a further modest improvement in early 2013.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 10:17 AM

    32. {no one could have predicted}Greece is facing a humanitarian crisis

    http://www.guardian.co.uk/commentisfree/2013/feb/11/greece-humanitarian-crisis-eu


    'The number of homeless people has risen to unprecedented levels for a European country: unofficial estimates put them at 40,000.' Photograph: Oli Scarff/Getty Images

    European societies typically assume that humanitarian crises only take place in the aftermath of natural disasters, epidemics, wars or civil conflicts.That such a crisis could happen in a European country, especially one that is a member of the European Union, seems out of the question to many of us.

    And yet a number of experts would maintain that Greece is currently in the centre of a humanitarian crisis. The head of Médecins du Monde, Nikitas Kanakis, the largest and most prominent NGO in Greece, was among the first to declare it openly. The port area of Perama, near Athens, in particular, is in the midst of a humanitarian disaster. The Medical Society of Athens, the largest professional body of its kind, has even sent a formal letter to the UN asking for intervention.

    If this humanitarian crisis has so far been little talked about, there are political reasons why. By acknowledging the severity of the situation, the Greek government and the EU would also have admitted that the current state of affairs has been brought about by the so-called economic "rescue" of Greece. So the authorities have chosen to keep quiet.

    It is true that there is no general agreement on what constitutes a humanitarian crisis. But the definition used by those with experience in the field is practical and straightforward. A humanitarian crisis is usually marked by rising poverty, heightened inequality in education and social protection, and lack of access to social welfare services. Particularly important indicators are loss of access to primary health services, medical examinations, hospitalisation and medication. In other words: when you see a crisis, you will not mistake it for anything else.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 10:24 AM

    35. Dive! Dive! Dive!

    Is the market afraid of the State of the Union?

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    Response to Demeter (Reply #35)

    Mon Feb 11, 2013, 12:33 PM

    45. Or the rebuttal?

    The markets must be free to raise all boats.

    I don't own a boat.

    No problem, the bank will lend you the money to get one.

    Could I have a job instead that can cover the cost of buying a boat?

    No, the bank will lend you the money.

    Who gives the bank the money to lend me the money?

    That's not important. Do you want a boat or not?

    Yes, but, how will I pay for it?

    That's not important. Sign here.

    Lacking the means to pay for boats, which no one could see coming, plunges the cost of all boats.

    Economy collapses! Banks require massive bail-out as profits dive!

    Thousands drown.

    Government steps in to rescue banks.

    Tide restored to raise all banks.

    Banks rise, boats remain swamped.

    Can I have a job?

    Do you want a boat?

    No I want a job so I can afford a boat.

    The bank will lend you the money for a boat.

    Who gives the bank the money to lend me the money for a boat if I lost my last boat because I don't have a job?

    That's not important. You must know by now that lending is what matters. Deficits are cause by lack of lending.

    Do you want a boat?

    How do I pay for a boat and a deficit at the same time if I don't have a job?

    Conclusion.

    Dumb ass lazy non boat owners cause deficits and no one could have seen that coming.

    and god bless america...

    do i need the sarcasm thingy... and one of theses days I will learn to spell

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    Response to westerebus (Reply #45)

    Mon Feb 11, 2013, 04:13 PM

    54. Funny and irritating

    It is just that simple.

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    Response to siligut (Reply #54)

    Tue Feb 12, 2013, 01:08 AM

    61. Indeed.

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 11:50 AM

    44. Musical Interlude. Fitting

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 12:35 PM

    46. Why the Unemployment Rate Is So High By LAURA D’ANDREA TYSON

    http://economix.blogs.nytimes.com/2013/01/11/why-the-unemployment-rate-is-so-high/

    ...Despite anecdotes about how employers cannot find workers with the skills they need, there is little evidence that the unemployment rate remains elevated because of mismatches between the skill requirements of available jobs and the skills of the unemployed. When the recession hit in 2008, unemployment rates soared in every industry. As usual during recessions, mismatches between employer needs and worker skills also increased temporarily, reflecting greater churn in the labor market as workers were forced to move across industries and occupations. But industrial and occupational mismatch measures are now back to their prerecession levels, indicating that the overall unemployment rate is high because unemployment rates remain high across all industries and most skill groups, not because of a growing skills gap relative to the gap that existed before the recession.



    The unemployment rates for all workers at all education levels jumped during the recession and have not recovered to prerecession levels. Even before the recession, the unemployment rates for workers with a high-school education or less were much higher than those for workers with a college education or higher. And there were high vacancy rates and low unemployment rates for professional occupations, while many service and blue-collar occupations had low vacancy rates and high unemployment rates. These structural differences persist but are no larger than they were before the recession...Increases in educational attainment levels and effective training programs would ameliorate such differences and the growing wage inequality they have generated. They would also facilitate the movement of workers among industries and occupations, making the labor market work better and reducing the structural unemployment rate from industrial and occupational mismatches. Alas, state funds for such programs have been slashed and federal funds will probably get an additional haircut later this year, even if the debilitating cuts in the sequester are averted as part of a long-run budget deal.

    Another feature of the current recovery is the long duration of unemployment for many workers. At the end of last year, 4.8 million Americans were unemployed for 27 weeks or more, and their share in the total number of unemployed workers fell to 39 percent after peaking at 45.5 percent in March 2011 and exceeding 40 percent for 31 consecutive months. The previous peak was a far lower 26 percent in 1983, at a time when the unemployment rate was about as high as it is now.



    Moreover, the number of workers who are grappling with long-term job loss is probably far larger than the official number of long-term unemployed, as it does not include 1.1 million discouraged workers who want a job but are not currently looking for work, and many of the 1.7 million workers who have joined disability rolls because they cannot find a job. Why is the long-term unemployment problem so much more severe in this recovery? Part of the answer lies in the fact that the loss of jobs in the 2008-9 recession was more than twice as large as in previous recessions and the pace of gross domestic product growth during the recovery has been less than half the average of previous recoveries...

    MORE BLEAK HOUSE

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    Response to Demeter (Reply #47)

    Mon Feb 11, 2013, 12:46 PM

    49. Profound Weight of Layoffs Is Seen in Work Trends Survey

    http://www.nytimes.com/2013/02/07/business/profound-weight-of-layoffs-seen-in-survey.html

    ...While about 8 percent of Americans are unemployed, nearly a quarter of Americans say they were laid off at some point during the recession or afterward, according to the survey. More broadly, nearly eight in 10 say they know someone in their circle of family and friends who has lost a job.... The survey presented a bleak view of the economic future. A majority of Americans say they think it will be at least six years before the economy is made whole again, if ever. Three in 10 said the economy would never fully recover from the Great Recession.

    “Despite significant improvements in the nation’s labor market, American workers’ concerns about unemployment, the job market, job security and the future of the economy have not changed much since we conducted a similar survey in August 2010,” the report said.


    Just a third of Americans surveyed in this poll, conducted from Jan. 9-16, said they thought the economy would be better next year, the same share that said so two years earlier. Of those laid off in recent years, nearly a quarter said they still had not found a job. Re-employment rates for older workers have been particularly bad, with nearly two-thirds of unemployed people 55 and older saying they actively sought a job for more than a year before finding one or had still not found work. Not surprisingly, those who are unemployed are especially downbeat about many economic issues in addition to their own finances. Of those who were jobless and looking for work, 31 percent said their jobless benefits had run out and 58 percent said they were concerned their benefits would run out before they found work. Of those who have found work, nearly half say their current job is a step down from the one they lost, and a slim majority say they earn less than they did in their previous job. A quarter of those re-employed said they thought that the hit to their standard of living would be permanent.

    The reliance on one’s personal network and savings rather than the social safety net showed up frequently in the survey data. More people reported borrowing money from friends and family than reported using food stamps. A third cut back on doctors’ visits or medical treatment. A quarter of the unemployed said they had enrolled in retraining programs of some kind; half of them reported paying for the education on their own or through family assistance. Twenty-three percent received some type of government financing for their training programs.

  • Unemployed workers were more likely than employed workers to say that the government is primarily responsible for helping the jobless. But even then, a majority of the unemployed thought that workers and employers were more responsible for getting people back to work than the government was.

  • Americans over all were also somewhat less critical of bankers this time than they were two years earlier. About one in three (35 percent) respondents attributed high unemployment levels to the actions of Wall Street, compared with 45 percent in 2010.

  • Americans were most likely to attribute high unemployment to cheap foreign labor. Four in 10 also said they believed illegal immigrants were taking Americans’ job opportunities — which does not bode well for political support for an amnesty program now being discussed in Washington.

    Most people surveyed lost at least some of their savings. Asked about their financial health, six in 10 Americans said their finances would not improve in the next few years; just 16 percent said their family finances were already back to prerecession levels or suffered no loss in the first place. More educated, better-off people were substantially more likely to report being as financially secure as they were before the recession began.

    Responses are based on an online survey conducted by GfK using a nationally representative sample of 1,090 adults. The margin of sampling error is plus or minus three percentage points.
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    Response to Demeter (Reply #49)

    Mon Feb 11, 2013, 12:47 PM

    50. SEE ALSO: Poll: Americans expect economic pain to continue

    http://www.washingtonpost.com/business/economy/americans-expect-economic-pain-to-continue/2013/02/06/e339db9c-7098-11e2-8b8d-e0b59a1b8e2a_story.html

    ...The survey by the John J. Heldrich Center for Workforce Development at Rutgers University paints a picture of a nation wounded by the recession in ways that have diminished future expectations...

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    Response to Tansy_Gold (Original post)

    Mon Feb 11, 2013, 12:41 PM

    48. Avoiding Tax Refund Identity Fraud

    http://www.huffingtonpost.com/jason-alderman/avoiding-tax-refund-ident_b_2633878.html

    Many people file their income tax returns as early in the year as possible. Some are eager to claim their tax refund right away, while others are simply following their New Year's resolution not to procrastinate until midnight, April 15.

    Let me add another good reason to file your taxes right away: tax refund identity fraud.

    That's where someone uses your Social Security number (SSN), birth date and other private information to file a fraudulent income tax return in your name and then pockets the resulting tax refund. Often, a victim's first clue is a letter from the IRS contesting their legitimate tax return, saying one has already been processed under that name. It can take months -- and mounds of paperwork -- to unravel the mess.

    This scam has proliferated in recent years thanks to a confluence of events:

  • There's a thriving black market in personal information stolen from healthcare facilities, nursing homes, schools, insurance companies and other institutions that require an SSN as identification. (Even identities of children, dead people and prisoners are being hijacked.)

  • The IRS is pressured to begin issuing refunds shortly after taxpayers start filing returns in mid-January, even though employers and financial institutions aren't required to submit withholding and income documentation until the end of March. Thus, disparities often aren't caught until months later.

  • The growing popularity of electronic filing, where hard-copy documentation (like W-2 and 1099 forms) isn't required.

  • Many people receive refunds via direct deposit and prepaid debit cards. Criminals open and close accounts using bogus addresses long before the theft has been detected.


    Thanks to severe budget cuts and chronic understaffing -- not to mention constantly playing whack-a-mole with thieves who dream up new schemes -- the IRS is hard-pressed to keep up. In one extreme example, the agency issued more than $3.3 million in refunds for 2,137 tax returns filed to a single address. In another case, 590 refunds totaling more than $900,000 were deposited into a single bank account.

    But all is not lost. Working with the Justice Department's tax division and U.S. attorney's offices around the county, the IRS has significantly beefed up its fraud-prevention efforts. In 2011, they intercepted nearly 262,000 fraudulent tax returns seeking almost $1.5 billion in refunds related to identity theft. And the IRS now issues Identity Protection Personal Identification Numbers to impacted taxpayers to protect their future tax filings.

    So what should you do if you've been victimized? Typically, the IRS will send you a notice that:

  • More than one tax return for you was filed;

  • You have a balance due, refund offset or have had collection actions taken against you for a year in which you didn't file a return; or

  • IRS records indicate you received wages from an employer you don't recognize. This could indicate that someone has used your personal information to get a job.

    If you receive such a notice, don't ignore it. Complete an IRS Identity Theft Affidavit and return it with a copy of the notice to the address provided on the notice. If you did not receive a notice but believe you may be at risk, the form contains separate submission instructions. You can also contact the IRS Identity Protection Specialized Unit at 800-908-4490.

    The IRS's Identity Protection website includes tons of helpful information, including ways to tell whether your identity may have been stolen, how to report a breach and tips to avoid identity theft.

    Here are several ways to minimize your chances of being victimized:

  • Don't carry your Social Security card or any documents containing your SSN.

  • Don't give a business your SSN just because they ask. Give it only when truly required.

  • Regularly check your credit reports for errors or fraudulent activity.

  • Protect your computer by using firewalls, anti-spam/virus software and updated security patches, and frequently changing passwords for Internet accounts.

  • Don't give personal information by phone, mail, email or Internet site connection unless you initiated the contact or are sure you know with whom you're dealing.

  • The IRS never initiates contact by email to request personal or financial information, or to alert you to an upcoming audit or refund. If you receive suspicious-looking IRS-related communications and aren't sure what to do, visit the IRS Report Phishing website for instructions.

  • Use a strong password when filing your tax return electronically and use only a secure network connection -- no public Wi-Fi networks. Once e-filed, save the return and any back-up documentation to a flash drive or CD and delete them from your hard drive. If you're working with an accountant, ask about their security measures.

    And finally, file your tax return as early as possible to beat potential scammers to the punch. If you owe money, you can always file your return now and mail the payment by the April 15 deadline.

    This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a legal, tax or financial advisor for specific information on how certain laws apply to you and about your individual financial situation.
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