STOCK MARKET WATCH, Tuesday 29 August

[ozymandius]

Tuesday August 29, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 876 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2075 DAYS
WHERE'S OSAMA BIN-LADEN? 1775 DAYS
DAYS SINCE ENRON COLLAPSE = 1736
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54


U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON August 28, 2006

Dow... 11,352.01 +67.96 (+0.60%)
Nasdaq... 2,160.70 +20.41 (+0.95%)
S&P 500... 1,301.78 +6.69 (+0.52%)
Gold future... 623.90 -6.90 ( -1.09%)
30-Year Bond 4.93% +0.00 (+0.04%)
10-Yr Bond... 4.80% +0.01 (+0.13%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Rob Kirby

PRISONERS IN OUR OWN HOMES OR HOSTAGE TO GROWTH?

Last week we were treated to a round of economic numbers implying “anything but” growth:

* Last week’s anemic economic numbers began with Aug. 23 report of July Existing Home Sales - where already slowing estimates were for a 6.60M rate. The actual number when reported was for a much weaker than expected - dismal -6.33M annualized rate. In economic jargon, folks, this is what is referred to as a “spectacular miss.”

* Compounding the reporting of fragile housing data was the weaker than expected Aug. 24 report of July Durable Goods Orders. Broadly defined, durable goods are products that aren't consumed or quickly disposed of, and can be used for several years. Here, a much larger than expected decline occurred <-2.4%> than was originally forecasted <-1.0%>. In economic speak, folks, this means that consumers have basically “zippered-up-their-wallets” in the month of July. This is worrisome to economists because the economic recovery that has reportedly been in place since 2001 has been largely “consumer led.”

* Additionally, and confirming the July Durable Goods Report, on Aug. 24 we also learned that July New Home Sales had also weakened more than originally anticipated <1100K> to the 1072K mark. In case you were wondering, folks, this dismal report would tend to confirm that the Fed’s long line of interest rate increases has finally had the intended effect of slowing the once ‘red hot’ housing sector of the economy.

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

[bahrbearian]

2. Finally my 1st K/R on the SMW.

As I get ready for bed .

[ozymandius]

4. Good morning bahrbearian.

Thanks. And good night.

:hi:

[ozymandius]

3. Today's Reports

10:00 AM Consumer Confidence Aug
Briefing Forecast 105.0
Market Expects 102.5
Prior 106.5

2:00 PM FOMC Minutes Aug 8

[Buttercup McToots]

7. And what is today going to bring us?

My gold stocks have dropped and my head hurts...Ouch:eyes:

[ozymandius]

13. Here's a hint.

Dollar Drops; U.S. Consumer Confidence Likely Fell to 2006 Low

Aug. 29 (Bloomberg) -- The dollar declined on speculation an industry report today will show consumer confidence fell to the lowest this year, making it less likely the Federal Reserve will resume raising interest rates.

The U.S. currency is heading for a monthly loss against the euro as traders bet the European Central Bank will raise its key rate twice more with consumer confidence in Germany at the highest in almost five years. The Fed broke a two-year cycle of rate increases earlier this month in response to signs of slower growth. Minutes of the meeting will be released later today.

``There's downside risk to the data today, and that's a negative for the dollar,'' said Steve Barrow, chief currency strategist at Bear Stearns Cos. in London. ``Our view is the Fed will pause again in September.''

The dollar fell to $1.2818 per euro at 10:16 a.m. in London, from $1.2779 in late New York trading yesterday, poised for a 0.4 percent monthly decline. The U.S. currency also dropped to 116.76 yen, from 117.18, the biggest slide in two weeks. It was lower today against 14 of 16 major currencies tracked by Bloomberg.

Gold tends to do better when the dollar drops.

[Buttercup McToots]

18. Ozzy your a toots!

My heachache is now better...:-)

[UpInArms]

46. U.S. consumer confidence falls sharply in August - 99.6 from 106.5 in July

9:59 AM ET 8/29/06 U.S. AUG. 12-MONTH INFLATION EXPECTATIONS HIGHEST SINCE OCT.

9:59 AM ET 8/29/06 U.S. AUG. CONSUMER CONFIDENCE LOWEST SINCE LAST NOV.

9:59 AM ET 8/29/06 U.S. AUG. CONSUMER CONFIDENCE BELOW CONSENSUS 102.7

9:59 AM ET 8/29/06 U.S. AUG. CONSUMER CONFIDENCE FALLS TO 99.6 VS REV 107 JULY

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B7548B6C5%2D5BF0%2D4424%2D876D%2D0C73BB892B4B%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- U.S. consumer confidence weakened sharply in August, the Conference Board said Tuesday. The consumer confidence index fell to 99.6 in August from a revised 107.0 in July. This is the lowest level of confidence since last November, when hurricanes battered the southern United States. The fall was sharper than expected. Economists expected the index to drop to 102.7 from the initial estimate of 106.5 in July. Expectations for inflation in the next year rose to 5.5% from 5.1% in July. This is the highest level since last OCtober.

[Ghost Dog]

50. Consumer confidence plunges in August

http://news.yahoo.com/s/ap/20060829/ap_on_bi_ge/economy

NEW YORK - Worries about the job market caused consumers' confidence in the U.S. economy to tumble in August to its lowest level in nine months.

The Conference Board, a New York-based research group, said Tuesday its confidence index fell to a reading of 99.6, down from 107.0 in July. The drop was bigger than analysts had expected.

The present situation index, which measures how shoppers feel about current economic conditions, plummeted to 123.4 in August from 134.2 in July.

The expectations index, which gauges consumers' outlook over the next six months, dropped to 83.8 in August from 88.9 a month earlier.

/...

[UpInArms]

60. Job woes knock US consumer confidence to 9-mth low

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=2006-08-29T143306Z_01_N29423939_RTRIDST_0_ECONOMY-CONSUMERS-UPDATE-1.XML

excerpt:

"Less favorable business conditions coupled with a less favorable job scenario have resulted in the largest one-month decline in confidence since Hurricane Katrina last year," Lynn Franco, director of The Conference Board Consumer Research Center, said in a statement.

"Consumers are growing increasingly pessimistic about the short-term outlook."

<snip>

"Confidence was lower than expected, but (that) doesn't change our expectations for a soft landing for the economy rather than a hard landing," said Patrick Fearon, senior economist at A.G. Edwards and Sons in St. Louis, Missouri.

"The rise in inflation expectations could be due to the high gasoline prices in early August. The index might not have captured the decline in gasoline prices late this month."

Labor market conditions became less favorable in August, the Board said. The percentage of consumers surveyed who said jobs were "plentiful" dropped to 24.4 percent in August from 28.6 percent in July while those who said jobs were "hard to get" rose to 21.1 percent from 19.6 percent.

...more...

[UpInArms]

76. Gloom a factor in Aug. pause, FOMC minutes show

2:00 PM ET 8/29/06 LACKER SAYS INFLATION OUTLOOK 'DETERIORATED' IN JULY

2:00 PM ET 8/29/06 LACKER, LONE DISSENT, WANTED TO BRING INFLATION DOWN RAPIDLY

2:00 PM ET 8/29/06 FED'S LACKER: SLOWDOWN UNLIKELY TO BRING DOWN CORE INFLATION

2:00 PM ET 8/29/06 SLOWER GROWTH SEEN FROM REVISED PRODUCTIVITY DATA: MINUTES

2:00 PM ET 8/29/06 FED STAFF FORECASTS 6 QTRS OF BELOW TREND GROWTH: MINUTES

2:00 PM ET 8/29/06 FOMC MINUTES SHOW FED STAFF CUTS GROWTH FORECAST

2:00 PM ET 8/29/06 FOMC MINUTES SHOW 'NEARLY ALL MEMBERS' FAVORED PAUSE

2:00 PM ET 8/29/06 FOMC: PAUSE WOULD LIMIT RISK OF TIGHTENING TOO MUCH

2:00 PM ET 8/29/06 FOMC SAW 'LIMITED RISK' FROM PAUSE TO AWAIT NEW ECON DATA

2:00 PM ET 8/29/06 FOMC SAW AUG. PAUSE AS 'CLOSE CALL,' MORE HIKES POSSIBLE

2:00 PM ET 8/29/06 FOMC AUG. MINUTES: MOST MEMBERS THOUGHT INFLATION WOULD EASE

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7BE8498A62%2D142B%2D4C85%2D907B%2D321AB0555742%7D&symbol=

WASHINGTON (MarketWatch) - A new Fed staff forecast of below-trend growth over the next year and a half was a key factor in the central bank's decision to stop tightening after two years of steady rate hikes, according to the minutes of the meeting released on Tuesday.

The Fed staff presented a new forecast at the closed door meeting indicating that real gross domestic product would grow below-trend for the next year and a half.

Factors behind the lower growth rate were "the slowdown in the housing market, the effects of higher energy prices on household purchasing power, the waning impetus of household wealth effects on consumer spending and the effects of past policy tightenings."

A majority of FOMC members cited the slower growth outlook was one of the central forces that could push core inflation down gradually in coming months.

"Most FOMC members thought that, with energy prices possibly leveling out, aggregate demand moderating and long-term inflation expectations contained, core PCE inflation likely would decline gradually from its recent elevated level, though the upside risks to inflation were significant," the minutes showed.

There seemed to be some, but not a great deal, of sympathy on the FOMC for Richmond Fed president Jeffrey Lacker's dissent at the August meeting in favor of additional tightening.

...more...

[54anickel]

80. Crap, now I've got "Sympathy for the Devil" stuck in my noodle. Not

that I disagree with Lacker - I think it's more from using the terms sympathy and FOMC in the same sentence.

[54anickel]

83. Here are the minutes

http://www.federalreserve.gov/FOMC/minutes/20060808.htm

[54anickel]

87. Took the wind out of the buck's sails

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i
Last trade 84.97 Change -0.08 (-0.09%)

Settle Time 15:01 Open 85.04

Previous Close 85.05 High 85.38

Low 84.90 2006-08-29 14:47:47, 30 min delay

[ozymandius]

5. Oil edges higher as Iran worries halt selling

LONDON (Reuters) - Oil edged higher on Tuesday as worries about Iran's determination to press ahead with its nuclear programme helped to halt a steep sell-off.

U.S. crude for October delivery rose 11 cents to $70.80 a barrel by 1000 GMT and London Brent crude gained 28 cents to $71.10 a barrel.

On Monday, U.S. crude fell by $1.90 after Ernesto, which was briefly the first hurricane of the U.S. season, was downgraded to a tropical storm.

-cut-

The hurricane season continues until around November, but analysts say the supply situation is comfortable and generally predict oil prices, which hit an all-time peak of $78.65 early this month, will struggle to regain previous strength.

http://news.yahoo.com/s/nm/markets_oil_dc

[ozymandius]

6. BP facing oil and gas probe: WSJ

NEW YORK (Reuters) - Federal investigators are examining whether BP (BP.L) manipulated crude oil and unleaded gasoline markets, according to a report in The Wall Street Journal on Tuesday that cited lawyers and traders close to the case.

BP confirmed the investigations, but declined further comment. "We are aware of the investigations, but we are not going to comment on the specifics," a BP spokesman in London said.

The Journal said the federal investigations signal a rise in regulatory scrutiny of the major oil company.

The newspaper said BP, which has been summoned before Congress next week over problems at its Alaska pipelines, already faces a civil complaint filed by federal commodities regulators for allegedly manipulating much of the U.S. market for propane.

http://news.yahoo.com/s/nm/20060829/bs_nm/energy_bp_dc_4

[54anickel]

21. US Justice Dept is focused on "a single day's trading in 2002"? And

who are the rest of these "federal investigators" and what are they focusing on? That article is clear as mud. Though this one line might explain the rather huge drop in oil prices yesterday...regulations might start to be enforced a bit?

The Journal said the federal investigations signal a rise in regulatory scrutiny of the major oil company.

[ozymandius]

8. Iran to miss 2010 oil output target

TEHRAN (AFP) - Iran will miss its 2010 crude oil production target by 500,000 million barrels per day (bpd) owing to a lack of investment in ageing oil fields.

Crude oil production could reach 4.5 million bpd by the end of the state's fourth five-year development plan (2005-2010), well under the original production target of 5.0 million bpd, National Iranian Oil Company managing director Gholam Hossein Nozari said Tuesday.

"We are not close to the 5.0 million bpd target of the fourth plan. More than 80 percent of the current total oil output is being provided from aged oil fields that need serious investment to increase production," he said.

http://news.yahoo.com/s/afp/20060829/wl_mideast_afp/iranoileconomyenergy_060829090547

[ozymandius]

12. Crude ends at two-month low; natural gas loses almost 10%

Energy prices drop as Ernesto weakens

SAN FRANCISCO (MarketWatch) -- Crude-oil futures tumbled to a more than two-month low Monday and natural-gas futures closed with a loss of almost 10% as concerns ebbed about the potential for the season's fifth-named storm to damage energy operations in the Gulf of Mexico.

-cut-

Crude for October delivery closed down $1.90 at $70.61 a barrel on the New York Mercantile Exchange, its weakest session-end level since June 20.

It tapped a low of $70.15 earlier, marking the contract's weakest intraday level since June 19. The September crude contract traded as low as $69.60 a barrel on Aug. 18, before it expired on Aug. 22.

As for the oil products, September unleaded gasoline fell 11.2 cents, or 5.9%, to close at $1.7831 a gallon after a five-month low of $1.771. September heating oil closed at $1.9659 a gallon, down 6.39 cents, or 3.2%.

Meanwhile, September natural gas dropped to a low of $6.32 per million British thermal units, a level not see since July 21. It closed at $6.472, down 68.5 cents, or 9.6%.

more

[skids]

14. Now is it that people are really so stupid...

...to not understand that Ernesto has all the potential it did at the start to become a hurricane again, and that it was fully expected to weaken while passing over land but then to get stronger again?

...Or is it just that they figured it was the most swallowable explanation to offer the public?

I guess it doesn't matter.

[ozymandius]

15. just a scapegoat

Iran and Ernesto (or the hurricane-du-jour) are scapegoats for rising energy prices. Anyone who knows anything about publicly traded commodities can see that investment banks like Goldman Sachs are primarily responsible for rising oil prices. Oil futures trading is a no-lose proposition. Investment banks either buy futures or oil on the current market and sell after holding the crude for awhile. The "crisis" factor of Iran ignoring another U.N. deadline is irrelevant to the actual price of oil.

Either when shots are fired across the Strait of Hormuz or oil is pulled off the market in protest of U.N. sanctions, then Iran's position is relevant to the price.

[Ragin_mad]

17. The reasoning doesn't make sense

The reason that Ernesto is now projected to make a more northerly turn, thereby missing the oil fields in the Gulf of Mexico.

[AnneD]

43. Morning Marketeers,

:donut:and lurkers. Everyone makes choices and places their bets in a hurricane (or any other situation). You weigh factors such as family, financial means, health, etc.

Any one that works with the poor could have said-end of the month-many of these folks may not have money to evacuate (buy gas, pay for bus, etc). many of those in NOLA that died did so unnecessarily. The main reason was poor planning and poor response by their leaders and poverty.

I was undecided about Rita until the day before it made land fall. It tilted a bit and I knew we would be on the clean side. I stayed in Houston and avoided all the evacuation gridlock (which had actually cleared out by then so I could have made a quick exit if needed). I made an educated guess, was prepared, and had a bit of luck. I never bust folks chops for their decisions to evacuate or not-there are too many factors sometimes. I do hold government accountable for planning and response immediately after a disaster. I do not expect a 911 response in the middle of a hurricane.

As today is a day of remembrance for many of our new (or temporary) Houstonians, I would like to nominate a theme song for today: Queen of the Waves. It is sung around here on Sept 8 to commemorate the bravery and dedication of the Sisters of Charity of the Incarnate Word and the orphans in their care during the Great Storm.

Queen of the Waves
from a French hymn, author unknown

Queen of the Waves, look forth across the ocean
From north to south, from east to stormy west,
See how the waters with tumultuous motion
Rise up and foam without a pause or rest.

But fear we not, tho' storm clouds round us gather,
Thou art our Mother and thy little Child
Is the All Merciful, our loving Brother
God of the sea and of the tempest wild.

Help, then sweet Queen, in our exceeding danger,
By thy seven griefs, in pity Lady save;
Think of the Babe that slept within the manger
And help us now, dear Lady of the Wave.

Up to the shrine we look and see the glimmer
Thy votive lamp sheds down on us afar;
Light of our eyes, oh let it ne'er grow dimmer,
Till in the sky we hail the morning star.

Then joyful hearts shall kneel around thine altar
And grateful psalms reecho down the nave;
Never our faith in thy sweet power can falter,
Mother of God, our Lady of the Wave

For more info and to here Queen of the Waves
http://www.1900storm.com/queenofwaves/index.lasso

Happy hunting and watch out for the bears.

[OrangeCountyDemocrat]

51. YES YES YES YES YES!!!

That's It EXACTLY. This is a country filled with MORONS.

Present company excepted of course.

[Ghost Dog]

24. Decaying pipes risk 20% gains to energy prices

http://www.gulf-times.com/site/topics/article.aspx?cu_no=2&item_no=104883&version=1&template_id=36&parent_id=16

<snip>

"What we have is an entire generation of oil infrastructure that more or less came on stream at the same time,’’ said Deborah White, an analyst at Societe Generale in Paris, who helped plan the Prudhoe Bay field development in the 1970s. "It’s now all of a certain age, fragile, and can’t be pushed quite as hard.’’

In the Norwegian North Sea, 8% of wells have weaknesses that disrupt production, according to a study for the nation’s Petroleum Safety Authority. A similar amount of offshore oil and gas output probably is being lost worldwide because of faulty wells, said Jan Andreassen, an author of the Norwegian study.

Russia’s pipeline monopoly, Transneft, estimates its programme to improve its pipeline system will take almost three decades to complete.

Oil consumers depend more than ever on regions such as Alaska and the North Sea that were developed in the 1970s, after the Arab oil embargo led the US and Europe to seek alternative supplies.

Oil prices have more than doubled in the past three years as demand accelerated. Benchmark New York crude oil futures jumped 3% on the day BP revealed the extent of corrosion in the Prudhoe Bay pipeline, which caused leaks and ate away as much as 81% of the steel.

Stavanger, Norway-based Statoil, the country’s largest oil and gas provider, said production this year may be as much as 25,000 bpd below forecast because of extensive maintenance and lower output from older North Sea fields.

Andreassen’s study, published in June, found that 18% of 406 wells tested in Norway’s section of the North Sea had weaknesses and 8% had faults that demanded they be shut. "This is a subject people don’t like to talk about,’’ he said in an August 16 phone interview. "This is not particular to Norway. This is an industry problem.’’

The UK and Norway combined pump 4mn bpd, most from the North Sea, more than every Opec member except Saudi Arabia.

/more...

[54anickel]

47. Detroit Sees Cheap Gas as History (About freakin' time!)

http://www.nytimes.com/2006/08/29/business/29auto.html?_r=2&adxnnl=1&oref=slogin&ref=business&adxnnlx=1156860005-P8YL1T4HPaLdtQeexvGf5Q

TOLEDO, Ohio, Aug. 28 — The Chrysler Group, which depends more heavily on sales of pickup trucks and sport utility vehicles than any other Detroit automaker, said Monday that it expected gasoline prices to remain at $3 to $4 a gallon for the rest of this decade.

The comments by Thomas W. LaSorda, Chrysler’s chief executive, are the first time a Detroit automaker has issued a specific forecast on gas prices since they began climbing to $3 a gallon and higher.

Ford’s chief sales analyst agreed Monday that high gas prices were not a temporary phenomenon, although he did not cite a price range. The analyst, George Pipas, said the auto company expected gas prices to remain high, volatile and unpredictable.

Together, the comments signal a recognition that the two automakers may have to fundamentally change their product mix to put more emphasis on fuel-efficient vehicles — a move General Motors says it already is making.

Mr. LaSorda, who had traveled here for the start of production of a four-door version of the Jeep Wrangler, was asked whether gasoline prices had peaked. “I would hope so,’’ he replied, “but we’re planning internally as if it is $3 to $4 a gallon.”

more...

[displacedtexan]

9. 8 days of Housing News

Pretty scary, y'all!

Link to stories

# As Exotic Loans Reset, Popularity Persists 08/28/06
# Home hardships provide opportunities 08/28/06
# More supply, less demand in Hawaii 08/28/06
# Housing Bust Could Leave Market In State Of Agony 08/28/06
# SELLERS, BUILDERS HIT BY BIG APPLE DOWNTURN 08/28/06
# The housing bubble—is this the big one? 08/28/06
# Going from boom to glut 08/27/06
# Slowdown in house sales compels 'brutal honesty' 08/27/06
# David Lereah : Real Estate Reality Check (PowerPoint Presentation) 08/27/06
# U.S. housing bust raises odds of recession 08/26/06
# Construction hitting a wall 08/26/06
# Where are all the students? 08/26/06
# Taking sides during market's downturn 08/26/06
# Unless you bought last year (when prices peaked), you're probably in good shape 08/26/06
# With the market turning to buyers, deals on homes can still be found 08/26/06
# Housing Bubble Horror: Market Has Makings for a Gory Story 08/25/06
# Getting real about the real estate bubble 08/25/06
# Real Estate’s Crash Landing 08/25/06
# Slow Moving Market: Realtors Coping, Sellers Are Suffering 08/25/06
# Realtors bust fears of housing bubble 08/25/06
# Incentives grow as market slows 08/25/06
# Chances for sales fall in July 08/25/06
# Los Angeles County home sales down 25 percent 08/25/06
# Real estate sellers call for higher agent's help 08/25/06
# Sacramento home sales drop almost 45 percent in past year 08/25/06
# Bakersfield real estate market shows signs of slowing 08/25/06
# Cool July for Las Vegas housing 08/25/06
# U.S. Drops Criminal Inquiry Into Fannie Mae 08/24/06
# Median price of a home in California at $567,360 08/24/06
# Market unease: Massachusetts home prices fall 3.5% 08/24/06
# Big Plunge In New Home Sales 08/24/06
# New Home Sales, Durable Goods Orders Dip 08/24/06
# 'Real trouble': Idaho home sales, construction plummet 08/24/06
# New Home Sales, Durable Goods Orders Dip 08/24/06
# Massachusetts real estate market slows dramatically in July 08/24/06
# The stages of home selling 08/24/06
# Housing is in a free fall and is pulling the economy down with it 08/23/06
# Fresh Data Shows Cooling Housing Market 08/23/06
# Toll Brothers reports 19% drop in profit, trims forecast 08/23/06
# Existing-home sales continue to slide 08/23/06
# Housing sale slowdown continues in S. Fla. 08/23/06
# Real Estate Psych Spike 08/23/06
# Tech Booms, Real Estate Busts? 08/22/06
# I'm In a Net-Worth State of Mind 08/22/06
# Orlando housing sales lose steam 08/22/06
# When homeowners are desperate to sell 08/22/06
# Portland, Maine: Owners cut prices amidflat sales in seaside town 08/22/06
# Housing prices may fall, but slowly 08/21/06
# Defaults rise in California 08/21/06

[ozymandius]

10. Check this out. I found this at Atrios' blog.

[displacedtexan]

31. *Gulp*

I'm sure (after seeing this graph)
that that Chinese proverb, "May you live in
interesting times," was an understatement.

Wow!

[AnneD]

48. Holy Batshit!!!

Wonder if the fall will be proportional. maybe banks will start giving away a free house when you open up a checking account. I think this may make Houstons down turn in the 80's look like a walk in the park.

[UpInArms]

56. today's tune by Blood, Sweat and Tears

What goes up
must come down
spinning wheel
got to go around
talkin' 'bout your troubles
it's a cryin' sin
ride a painted pony
let the spinning wheel spin
You got no money
you got no home
spinning wheel
all alone
talkin' 'bout your troubles and you,
you never learn
Ride a painted pony
let the spinning wheel turn
Did you find
your directing sign
on the straight and narrow highway
Would you mind a reflecting sign
Just let it shine
within your mind
and show you, the colors
that are real
Someone's waiting
just for you
spinning wheel,
spinning true
Drop all your troubles by the riverside
ride a painted pony
let the spinning wheel fly

[54anickel]

32. Fed May Tolerate Faster Inflation as Housing Sags, Growth Slows

http://www.bloomberg.com/apps/news?pid=20601087&sid=aL98FDoN5J08&refer=home

Aug. 29 (Bloomberg) -- Federal Reserve officials may be prepared to live with a pickup in inflation over coming months as they consider the cost to housing and jobs of higher interest rates.

``When you have a very visible strain in the economy like housing at present, something that probably won't break but just might, the Fed gives more weight to the potential for exponential losses,'' said Lou Crandall, chief economist at Wrightson ICAP LLC in Jersey City, New Jersey. ``A policy shock would be more costly than usual at present.''

Minutes released today of the Federal Open Market Committee's Aug. 8 meeting, where interest rates were kept steady for the first time in two years, will likely show how worried policy makers are about a property downturn versus the dangers of accelerating inflation.

The minutes will be released at 2 p.m. Washington time. Since the meeting took place, government and industry figures have shown a deepening slump in residential real estate, an industry that fueled economic expansion for five years. Consumer prices excluding fuel and food over the last three months rose at the fastest pace since 1994, while consumers' inflation expectations as measured by the University of Michigan jumped in August.

Fed forecasts presented to Congress last month predicted that inflation will hover around 2 percent to 2.25 percent next year -- a level that's higher than what some policy makers, including Chairman Ben S. Bernanke, have said is desirable. Bernanke added that inflation will probably recede in 2008.

more...

[Ghost Dog]

36. BoE chief economist hits at US inflation measure

http://www.msnbc.msn.com/id/14543326/

The US Federal Reserve is wrong to focus on core measures of inflation that exclude energy prices, Charles Bean, chief economist at the Bank of England, has suggested. It should focus instead on headline inflation, which is much higher, he argued. Including energy and food costs, US consumer price inflation is running at an annual rate of 4.1 per cent, against 2.7 per cent for core inflation.

<snip>

Mr Bean did not mention the Fed by name but his implication was clear. Fed officials, including chairman Ben Bernanke, typically talk about measures of core inflation excluding volatile food and energy prices, which they say better predict future headline inflation.

Central bankers in Europe take a sharply different approach. Both the Bank of England and the European Central Bank put greater emphasis on talk of headline inflation, which includes the immediate "first round" effect of rising energy prices. The Fed has tended to treat the rise in oil prices as a step change to a new equilibrium price level, which in itself does not generate ongoing inflationary pressure. It focuses on trying to prevent the "pass through" of higher energy costs to consumers in the form of higher prices for other goods and services. But the Bank of England and the ECB increasingly take the view that energy prices may be on a long-term upward trend, driven by industrialisation and urbanisation in China and India.

/,,,

[OrangeCountyDemocrat]

53. The Sun'll Come Out......In 2008

Bernanke added that inflation will probably recede in 2008.

Oh Boy, I can't wait! What's he going to say if that doesn't happen? "Oh well, guess I was wrong."

[RawMaterials]

67. I think he ment to say "the Neo cons" not inflation n/m

[54anickel]

33. Builders may be near liquidity crisis

http://www.dallasnews.com/sharedcontent/dws/bus/columnists/all/stories/082906dnbusdimartino.31b0350.html


A year ago, homebuilders were the darling of the credit rating agencies, the entities charged with helping investors determine the financial health of a corporate borrower.

That's striking considering that liquidity issues could lead to ratings downgrades for many builders within the next 12 months.

Mark Kiesel is a bond portfolio manager at Pacific Investment Management Co. He's studied homebuilders closely for years and is one of the few to question the still-solid outlook for the sector.

The bulls insist homebuilders are safer than in prior down cycles because they've consolidated into a group of stronger players.

"I don't buy it," Mr. Kiesel said.

The flaw, he explained, is that their newfound critical mass emboldened builders to be overly aggressive with land commitments.

more...

[AnneD]

94. For some time during and after ....

the housing bubble burst in Houston, it was impossible to get buildin loans. It didn't matter what you plan was of how many presales you had-lenders were not interested. I was a hard time for construction crews.

[ozymandius]

11. FTSE gains strongly after long weekend

London equities were sharply higher on Tuesday as trading started up again following the extended bank holiday weekend.

By late morning, the FTSE 100 was up 42.5 points, 0.8 per cent, at 5,920.0 while the mid-cap FTSE 250 was 17.9 points, 0.2 per cent, higher at 9,510.5.

The upward momentum came in reaction to a strong showing in the US on Monday.

Antofagasta was among the early blue-chip gainers, up 2.1 per cent at 442p, after the mining group reported forecast-beating interim results. First half profit before tax rose 79 per cent to $1.3bn, while the Chile-based company also forecast full-year copper production of 455,000 tonnes.

Travel and leisure shares were boosted by a fall in oil prices, as fears over Tropical Storm Ernesto eased. British Airways gained 3 per cent to 409¾p and Carnival was up 2.2 per cent to £21.66.

http://news.yahoo.com/s/ft/20060829/bs_ft/fto082920060628585448

[Ghost Dog]

25. Bourses boosted by pharma and tech stocks

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38958.3162268519-880931962&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

Europe’s bourses were buoyed on Tuesday by strong technology and pharmaceutical sectors as the London market caught up after a national holiday. Investors will be looking for clues on the outlook for US monetary policy from the minutes of the Federal Reserve’s August 8 interest rate setting meeting, due for release after the European close. The FTSE Eurofirst 300 added 0.6 per cent to 1,33.05 by midday with the Frankfurt Xetra Dax up 0.3 per cent to 5,870.35 and the CAC-40 in Paris 0.6 per cent better at 5,180.20 and the FTSE 100 in London 0.6 per cent higher at 5,916.1.

[Ghost Dog]

26. EADS higher as Russian bank buys stake

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38958.250150463-880928185&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

Shares in EADS rose 2.4 per cent to €23.18 on Tuesday after Vneshtorgbank, a Russian state bank, reportedly accumulated a 5 per cent stake in the aerospace company which makes Airbus aircraft. Other aerospace and defence groups rose on the news with Thales up 2.9 per cent to €33.70 and Finmeccanica 2.8 per cent ahead at €17.40.

[Ghost Dog]

29. Tokyo stocks up for first session in 5 days

http://www.ft.com/cms/s/29604d4e-3712-11db-89d6-0000779e2340.html

The Nikkei 225, which fell to its lowest level in two weeks on Monday, rose 0.8 per cent to 15,890.56, closing up for its first session in five days. The broader Topix gained 1 per cent to 1,615.99.

The yen fell to 149.97 against the euro in overnight markets, a new low. That sparked buying among exporters like Honda Motor, the number three carmaker which rose 1.6 per cent to Y3,930. Top automaker Toyota Motor gained 1.1 per cent to Y6,290. Canon, the digital camera maker, jumped 1.5 per cent to Y5,590.

Even Sony, whose share price has taken a drubbing from recalls of computer notebooks carrying its batteries, was back in positive territory. However, it continued to underperform the broader market with an 0.6 per cent rise, to Y5,000.

Star performers included Softbank, the internet and telecoms conglomerate which saw its share price plunge on Friday amid concerns about its accounting practices. In morning trading Softbank clawed back some of its losses, spurting 4 per cent to Y2,100.

/more...

[Ghost Dog]

73. Bourses mainly higher as pharmas provide lift

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38958.5092013889-880945069&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

Europe’s bourses were buoyed on Tuesday by strong technology and pharmaceutical sectors as the London market caught up after a national holiday. The FTSE Eurofirst 300 finished up 0.2 per cent to 1,367.4, while Frankfurt’s Xetra Dax slipped 0.1 per cent to 5,847.0 as MAN and Bayer lost ground . In Paris, the CAC 40 also gained , rising 0.2 per cent to 5,160.3, while London’s FTSE 100 climbed 0.2 per cent to 5,888.3. Novartis rose 0.6 per cent to SFr70.45 after Switzerland become the first European country to approve the company’s Lucentis drug as a treatment for a leading cause of blindness in people over 50. Genentech developed Lucentis, which has already been approved by the US Food and Drug Administration, and retains the US commercial rights. Novartis has exclusive rights in the rest of the world. Roche, the majority owner of Genentech, was up 0.5 per cent to SFr226.80.

[ozymandius]

16. And so I must leave.

I like living in the gritty city again. Yesterday's commute took about fifteen minutes instead of an hour from the previous location. I look forward to filling my gas tank once or twice per month instead of every week. The work commute is 210 less miles per week.

With gas prices expected to increase over the long haul, be it by hurricane, Iran or Goldman-Sachs, moving into a slightly more expensive place closer to everything was a no-brainer.

Have a great day folks!

Ozy :hi:

p.s. I was shocked to see the incorrect date on yesterday's thread. Must've really been out of it. I glad you folks found it anyway.

[Maeve]

19. Sorry the move was rough--glad the location is better!

And I could NOT believe it when I saw gasoline for $2.47 this morning! (I have to take the girls to school this year as we are 1/2 a block too close for them to catch the bus since cut-backs hit the system) Last year at this time it was over $3--not that I am fool enough to expect it to last...

[54anickel]

23. Huh? What "incorrect data"? I must have missed it. n/t

on edit - nevermind, I went back to take a peek.

[AnneD]

89. We chose our new digs for the same reason...

the higher cost was more than offset by the fewer miles driven. I average 1/4 tank of gas a week now instead of 1 tank. We can walk it if we need. Of course I use a bit more than 1/4th if I run an errand on the way home. Every thing is so close now, I hate to drive any distance over 15 miles these days (and that is living in Texas). We are very happy with our choice.

[UpInArms]

20. daily dollar watch

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

Last trade 85.01 Change -0.04 (-0.05%)

Dollar Weakens as Fed Minutes Not Expected to Alter Outlook for a Sept Pause

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Dollar_Weakens_as_Fed_Minutes_1156801004956.html

US Dollar


With London markets closed for a summer bank holiday, trading has been unusually thin today. After a week of strong gains, the US dollar sold off on the back of easing oil prices. We have also seen some dollar bulls square positions ahead of what could very well be bearish economic data tomorrow. We start the week off with US consumer confidence which will give us a sneak peak at how well the consumer has been holding up for the past month in the face of a slowing housing market and still relatively high energy prices. If consumer confidence falls significantly after the two back to back months of improvements that we saw in June and July, the outlook for further economic growth could be very negative. Even though we are expecting non-farm payrolls later this week, at the current moment, retail sales and the consumer is far more important. Past data have shown that the labor market remains steady while inflationary pressures are subsiding as oil prices drop back near $70 a barrel. This leaves growth the primary worry of the Federal Reserve and the consumer their key focus. Even though oil and housing have been a problem for some time, the US consumer continues to keep economic growth positive. Just earlier this month, retail sales were reported to be the strongest since the beginning of the year. It has kept dollar bulls optimistic but it remains questionable how much longer this can continue for. Aside from confidence, the minutes from the rate debate at the last FOMC meeting will also be released tomorrow. If you recall, that was same meeting that the Federal Reserve kept interest rates on hold for the first time in over 2 years. We will be looking for more insight on why the Fed paused and whether they felt that the risks were weighted more towards further weakness in the economy or a gradual resumption of stronger economic activity. Either way, we do not think that the minutes will shift the market’s expectation for another pause in September. Oil prices have fallen significantly over the past few weeks and with it, so has price pressures. The fear that inflation would be uncontrollable was the number one reason why the Fed kept on raising interest rates especially under the new Chairman who wanted to prove that he was an inflation fighter. With that fear diminished significantly, the Fed can take a much more relaxed approach to monetary policy.

...more...

[Ghost Dog]

30. Dollar falls ahead of busy economic week

http://www.ft.com/cms/s/14ecc80a-3740-11db-bc01-0000779e2340.html

The dollar lost ground on Tuesday as investors looked ahead to a busy week of economic data releases from the US.

The dollar fell 0.4 per cent against the euro to $1.2824, lost 0.3 per cent against sterling to $1.8988 and dropped 0.5 per cent to SFr1.2314 against the Swiss franc.

Mansoor Mohi-uddin, chief currency strategist at UBS, said while summer conditions were likely to continue to prevail in the final week of August, the dollar was entering a period of heavy event risk, starting with US consumer confidence figures, due at 14.00 GMT.

“With markets now pricing less than 25 per cent odds of further Federal Reserve tightening and assigning a high probability of an easing in 2007, there is some risk that an upside surprise in the US numbers prompts some rethinking,” he said. “However, we expect the data to generally support perceptions that the economy is slowing.”

The dollar also fell against the yen, dropping 0.5 per cent to Y116.70, amid renewed speculation that China would accelerate the pace of renmimbi appreciation against the dollar ahead of the International Monetary Fund meeting next month.

Paul Chertkow, head of global currency research at Bank of Tokyo-Mitsubishi UFJ, said the talk was fuelled by the increased volatility of the Chinese currency against the dollar following the pledge of the People’s Bank of China earlier this month to boost currency “flexibility.”

“However, we believe that the increase in daily volatility is intended purely to curb speculation,” said Mr Chertkow.

/...

[UpInArms]

22. Tecumseh layoffs may affect 450 (more than 2/3rds of workforce)

http://www.postcrescent.com/apps/pbcs.dll/article?AID=/20060829/APC03/608290570/1888/APCbusiness

NEW HOLSTEIN — Tecumseh Power Co. has issued notice of mass layoffs affecting up to 450 positions, or more than two-thirds of the company work force.

The layoffs will begin by Oct. 27, according to notice received Monday by the state Department of Workforce Development.

"This layoff is due to current business conditions and the cessation of certain operations in New Holstein," the company said in the notice dated Friday.

<snip>

Daniel Watson, Beaver Dam, business representative for Local 1259 of the International Association of Machinists and Aero-space Workers which represents hourly workers, said the facility, which makes small engines for lawn mowers and snow blowers employed 550 people.

...more...

[54anickel]

27. Global Fallout from America's Post-Bubble Shakeout

http://www.morganstanley.com/GEFdata/digests/20060828-mon.html#anchor0

It’s hard to imagine that a US-centric global economy wouldn’t be at risk in the aftermath of a bursting of the US housing bubble. Lacking in internal support from private consumption, the non-US world remains heavily reliant on selling exports to wealth-dependent American consumers. As the United States now comes to grips with the aftershocks of another post-bubble shakeout, so, too, must the rest of the world.

There’s no consumer in the world like the American consumer. In 2005, US personal consumption expenditures totaled $8.7 trillion. At market exchange rates, that was about 20% higher than consumption in Europe, a little more than three times that in Japan, nine times that in China, and fully 17 times consumption levels in India. The comparisons are equally striking when private consumption is expressed as home-currency shares of each economy’s respective GDP -- 70% for the US in 2005, 54% in Europe, 57% in Japan, 38% in China, and 64% in India. Putting it another way, one measure of America’s “excess consumption” -- defined in this case as the difference between growth in consumer outlays and disposable personal income -- was about $210 billion in 2005, or almost half of total consumption in India.

In the first installment of this essay, I concluded that over-extended US consumers would be quite exposed to the correction in the US residential property market that now seems to be unfolding (see my 25 August dispatch, “Another Post-Bubble Shakeout”). Downside adjustments to US consumption stem from three macro forces -- a negative wealth effect traceable to a flattening out of home prices, multiplier effects attributable to the employment cutbacks in construction activity, and possible increases in income-based saving to compensate for the loss of asset-based saving. During the ascendancy of the Asset Economy over the past 10 years, average growth in real consumption (3.7%) exceeded that of real disposable personal income (3.2%) by 0.5 percentage point per year. In light of the post-housing bubble headwinds noted above, I could easily see a reversal in this relationship, with consumption growth falling short of real income growth over a protracted period of time. Moreover, to the extent that the direct and indirect effects of weaker construction activity depress baseline income generation, the consumption outcome could be under even greater pressure. All in all, I wouldn’t be surprised if real consumption growth in the US averages 2.0% to 2.5% over the next couple of years -- about 1.5 percentage points slower than the vigorous asset-dependent growth trend of the past decade.

Should it occur, such a 40% haircut to the US consumption growth rate would have important consequences for the remainder of a US-centric global economy. In large part, that’s because the non-US portion of the world is very much lacking in domestic consumption support of its own and, as a result, remains heavily dependent on exports, much of them to the US. For example, over the 2003-05 time period, real growth in private consumption expenditures averaged just 1.2% in the Euro area, Japan, and in Asia’s newly industrialized economies (i.e., Korea, Taiwan, Hong Kong, and Singapore). By contrast, export volume growth averaged 7.1% in the same three regions over the past three years -- fully six times the pace of consumption growth. Meanwhile, in the US, there was much closer alignment between export and consumption growth over this same period -- 5.7% average growth in exports versus 3.5% growth in consumption. This underscores a sharp dichotomy in the balance between external and internal demand in the developed economies: For the non-US portion of the advanced world, the spread of export over consumption growth over the 2003-05 interval was nearly six percentage points -- almost triple the 2.2 percentage point spread in the US. Consequently, with the world’s dominant consumer likely to retrench in the aftermath of a bursting of its housing bubble, the rest of the world can hardly be expected to sidestep this blow.

more...

You know what bugs me most about eCONomists is their total acceptance that the level of "consumer consumption" is normal. By starting with that assumption, their next logical assumption is that it is totally natural to have 2 economic worlds - "consumption-short economies of the developed world" and "export-led developing world". That just strikes me to be a false premise to start with, and it totally ignores the role that corporate capital expenditures should be playing in the economy.

Where's the synergy between production of finished goods (for consumer as well as business consumption), corporate expenditures (which happens to include wages) and a robust economy? I mean, how could Henry Ford get it right in this day and age of globalization and financialization of our economy? Free trade agreements that are not also fair cannot produce the proper balance between units of production, units of consumption and units of purchasing power that is required for that "synergy".

While it may be quite painful, I think that in the end, a reduction in the "unnatural" rate of consumption (which has been based on credit and a negative savings rate) might not be such a bad thing. But that's in the end - getting there is going to absolutely SUCK! :hurts: :shrug: Then again, my thought process might just be full of sh*t.

[Ghost Dog]

35. cf: (FoE) Towards Sustainable Economies

Towards Sustainable Economies: challenging neoliberal economic globalisation
http://www.foe.co.uk/pubsinfo/briefings/pdf/towards_sustainable_economies.pdf#search=%22globalisation%20rebalancing%22 (note: .pdf. google html version here: http://66.249.93.104/search?q=cache:pKeNoGC53rUJ:www.foe.co.uk/pubsinfo/briefings/pdf/towards_sustainable_economies.pdf+globalisation+rebalancing&hl=en&gl=uk&ct=clnk&cd=11

Friends of the Earth International position paper

Break the taboo - recognise the failings of neoliberal economics

Why neoliberal economic globalisation is a problem

We live in a rapidly changing world. The phenomenon of globalisation - in particular, the advent of rapid global communication and the spread of new technologies - is altering the way people live their own lives and relate to each other. Globalisation has many facets - economic, political, social, cultural and technological. This paper concerns itself with just one of those facets, neoliberal economic globalisation, which has significant negative impacts on people and their environment right around the world.

Neoliberal economic globalisation encourages the pursuit of profit regardless of social and environmental costs. It is associated with:

• Increasing levels of inequality, both between and within countries.
• The concentration of resources and power in fewer and fewer hands (resulting in an erosion of democracy).
• Economic, social, political and economic exclusion; economic instability.
• Spiraling rates of natural resource exploitation and a loss of biological and cultural diversity.
• It prevents the maintenance and development of locally-appropriate and sustainable systems of commerce.
• Leads to weaker international agreements in other key areas (on the environment and development, for example).

Furthermore, the global North, using the resources of the global South at rock-bottom prices, has incurred an ecological debt to the South. Yet it is still those impoverished countries in the South that find themselves compelled to play the neoliberal game - exporting more and more - in order to pay off the only debts that seem to count: the financial ones. Ironically, this leads to oversupplied world markets, falling commodity prices and decreasing returns on Southern exports. These worsening terms of trade make it ever more difficult for the South to pay its financial debts.

Overall, the key issue that needs to be addressed is the fact that because of these impacts the policies promoted by proponents of neoliberal economics undermine those needed to develop sustainable societies. Just and sustainable societies require, almost by definition, equity, democracy, diversity and sustainable production and consumption. They require stronger local communities and economies and stronger and more co-operative relationships at the international level.

The real challenge for humankind will be providing a decent quality of life for a predicted population of 10 billion people in 2050, whilst reducing environment impacts to within system limits. Neoliberal economic globalisation is increasing the scale of that challenge. Yet the official line is that there is no alternative.

Something has to give. Since sustainable societies are the only long-term option we have, that something must be neoliberalism. The time has come to develop alternative approaches, to map out a framework for sustainable economies. That is what this position paper attempts to do.

/continues...

[54anickel]

40. Thanks GD - That's a keeper!!! n/t

[Ghost Dog]

45. Economic growth does not solve unemployment, (China) official

(Xinhua) http://www.chinadaily.com.cn/bizchina/2006-08/29/content_676841.htm

China's high-speed economic growth will not solve the country's unemployment problem, a National Bureau of Statistics (NBS) official told Xinhua in an interview.

During the Ninth Five-Year Plan period (1996-2000), China's GDP (gross domestic product) grew at an average annual rate of 8.6 percent and 8.04 million jobs were created each year. During the Tenth Five-Year Plan period (2001-2005), however, GDP grew at an average annual rate of 9.5 percent and only 7.48 million new jobs were created each year, according to NBS figures. From 1996 to 2000, for every percentage point of GDP growth, there was a 0.13 point growth in the employment figures, but from 2001 to 2005, the same GDP growth only boosted employment by 0.11 points, the official said.

The official attributed the phenomenon to numerous factors, including the migration of rural labor forces to urban areas, structural adjustments to the economy, the impact of reforms and the bankruptcy of some state-owned enterprises. Over 100 million peasants have migrated into cities to become workers, snapping up job opportunities spawned by fast economic growth, the official said.

But, as the country optimizes its economic structure, China's capital and technology-intensive industries are growing faster than labor-intensive industry. The economy depends increasingly on technological innovation and capital input for growth. Fewer workers are needed than before, the official said.

The official also referred to the impact of restructuring and closing down state-owned enterprises. In 1995, there were about 112.6 million people working in state-owned enterprises, but in 2005 the figure had plunged to 64.88 million. In 1991, 36.28 million people worked in collectively-owned sectors, but by 2005 the figure had slumped to 8.1 million.

/...

[54anickel]

58. China's Wealth Woes

With its dollar hoard rising at $17 billion a month and about to pass the $1 trillion mark, Beijing is finding out that it is possible to have too much money.

http://www.msnbc.msn.com/id/14535192/site/newsweek/

Sept. 4, 2006 issue - Sometime over the next few weeks, a shipment of lawn furniture, brake pads, lamps or the like is going to make history. The manufacturer, one among tens of thousands churning out product 24/7 in China's humming coast-al cities, will fill an order bound for the United States, take payment in American dollars and add a 12th zero to Beijing's foreign reserve—pushing the tally over the $1 trillion mark. Neither buyer nor seller will realize the transaction's significance, and barring an unforeseen shock to the global trading system, China's reserve will continue to rise by roughly $17 billion a month.

Beijing's growing dollar hoard represents the most dangerous imbalance in today's global economy. The United States is both importing heavily from China and borrowing heavily from the country to finance those purchases, pushing the dollar down and putting the two economic superpowers on a collision course. Washington politicians demand that Beijing raise the value of the yuan against the dollar, and Chinese officials have hinted that if pushed too hard they might shift their near-trillion-dollar reserve out of U.S. Treasury bonds, which could trigger a U.S. and global recession. The main thing preventing this confrontation is the fact that both sides have too much to lose. Former U.S. Treasury secretary Lawrence Summers once called this "the balance of financial terror." What has gone widely unremarked is that, increasingly, this balance is threatening China as much as the United States.

The United States has been worrying for the past 25 years about a mounting trade deficit and the threat it poses to America's financial pre-eminence. But China now views its surplus with growing alarm, too. Its dollar mountain reflects huge demand for Chinese goods and the Chinese currency needed to buy those goods. In mid-2005, Chinese officials, under intense pressure, did allow the renminbi to rise slightly, by just over 2 percent, but they fear—with some reason—that to go further could undermine their export competitiveness and lead to bankruptcies. Speculators, however, are betting that China will have no choice. The global market assumption that the renminbi is destined to rise is now "the key problem" for China's economy, warned the head of the National Bureau of Statistics, Qiu Xiaohua, last week. "It is fair to say that China is actually fighting a game against worldwide speculative capital ... If not handled properly, this will damage the national interest and endanger economic security."

In an economy that, for all its might, is still in the developing stage, it is no small trick to absorb $17 billion a month without destabilizing consequences. The cash is leaching into the economy, fueling growth of 11.3 percent in the second quarter, the fastest rate since 1994, threatening a meltdown. And every solution begets new problems: China has tried command economics, like simply ordering banks to grant fewer loans or publicly denouncing provincial officials who spend too recklessly, but that undermines its efforts to reform the banking sector using the market. It has tried raising interest rates, which can restrain growth but also attracts more dollars—from investors seeking returns, not import buyers—and weakens domestic demand. "They're in a trap," says Ronald McKinnon, a Stanford University economist, in reference to China's surging exports and undervalued currency. "And there isn't an easy way out."

more...

[54anickel]

70. Best Buy to open first outlet in China

http://news.yahoo.com/s/ap/20060829/ap_on_bi_ge/china_best_buy

SHANGHAI, China - China's overcrowded consumer electronics market will get yet a new dose of competition when U.S. retailer Best Buy opens its first outlet in China, likely by year-end.

Best Buy Co. is teaming up with local partner Jiangsu Five Star Appliance Co., China's No. 4 appliance and consumer electronics retailer, in opening a store in Shanghai's busy Xujiahui shopping district.

"We will open the first store hopefully toward the end of the year by December," Robert Willett, chief executive officer of a Best Buy unit called Best Buy International, told reporters Tuesday.

"But we're only going to open when it's right," he said. "This is not a race."

Best Buy, the biggest U.S. consumer electronics retailer, is only one of scores of foreign retailers taking advantage of a lifting of limits on foreign competition to try to woo consumers in the world's biggest potential market.

Despite intense local competition in the lower segments of the market, foreign brands dominate in malls and shopping centers aimed at the country's fast-growing middle class, who are able and willing to pay a bit more for better service and quality.

more....

Call me stupid, but I don't get it. US companies sell stuff predominately made in China to the Chinese on the impression of better quality and service? So the middleman DOES contribute to the quality of a final product. Well, that explains why so many people drive right by the farmers market on their way to the supermarket here. How could I have been so stupid as to thinking I was getting a better deal buying direct at the farmers market! :crazy: I've been purchasing inferior cucumbers!!!

[54anickel]

28. Americans' net worth falls, report says

http://www.cleveland.com/business/plaindealer/index.ssf?/base/business/1156840646113880.xml&coll=2

The net worth of many U.S. households has fallen as Americans cope with rising debt, flattening real estate values and stagnant wages, according to a report today from the Economic Policy Institute.

The study says the accumulation of stocks, bonds, bank savings or other assets aside from equity in their homes has eluded many Americans. In fact, about 30 percent of households have a net worth of less than $10,000.

The institute's report refutes the notion that most people have invested in the stock market through 401(k) retirement plans at work, mutual funds or other means. Less than half of households own stock in any form, and of those who own stock, just one-third have holdings in excess of $5,000.

"Stock is sometimes described as the democratization of wealth, which turns out to not so much be the case," Institute President Lawrence Mishel said.

The study by the Washington-based liberal think tank also noted a racial divide almost unchanged from 20 years ago.

more....

Damned liberal think tanks! :evilgrin:

[54anickel]

39. bit more from that one.....

The top 1 percent of households owned 36.9 percent of all stock market holdings in 2004, while the next 9 percent owned 41.9 percent. Thus, the top 10 percent of households owned almost fourth-fifths of all stock, and the remaining 90 percent of households owned the rest.

So who was the target for those tax changes regarding dividends and capital gains again?

[OrangeCountyDemocrat]

55. My MORONIC repub Secretary

She lives paycheck to paycheck. Her only retirement savings is a Simple IRA valued at around $500 which she started earlier this year through our company.

She claims that my $6 pizza lunch is too expensive for her budget, and that she can only afford to eat a $3.50 McDonald's salad Once per week.

But, she consistently votes repub, because that's what rush tells her to do each morning, since she listens to him on the way into work. She's A MORON, and will still be voting repub while she's living on the streets begging for money.

OK, so I'm exaggerating a bit. That will never happen to her. But I guarantee you, she'll be scraping to make ends meet 10 years from now, and still voting repub, because OBVIOUSLY they care for her well being more than the evil Democrats.

[kineneb]

84. symptomatic of "right wing authoritarians"

...just now reading John Dean's latest book: Conservatives Without Compassion.

These types are the programmed "good Germans" for whom logic does not exist. They must follow the dictates of their (equally deluded) leaders. Some have enough brains (or whatever) to be convinced that they are wrong, but a percentage are hopelessly plain blind to reality.

[OrangeCountyDemocrat]

91. That Is A Scary Book, Eh?

I started reading it also. Not that it's difficult reading, but it's hard....since it's some scary shit.

I saw him speak a few weeks ago here in Southern California, and he's one of the more intelligent "conservatives" I've heard go on record. Although as he says, he is now considered Liberal, given his views are out of touch with today's repubs.

I keep coming back to the 23% he says will NEVER EVER EVER go away. We're stuck with that 23% no matter what, so it's kind of scary that so many MORONS exist, but I witness them daily.

[54anickel]

34. Bankruptcy filings fall after tough new law

http://www.chron.com/disp/story.mpl/business/4147695.html

U.S. bankruptcy filings have fallen to the lowest level in five years after a federal law made it harder for individuals to seek protection from creditors.

About 1.5 million personal and business bankruptcies were filed in the year that ended June 30, a 9.3 percent drop from the previous year, according to data released Monday by the Administrative Office of the U.S. Courts.

Personal filings fell to 1.45 million from 1.6 million, or 9.4 percent. Business filings fell by 844 to 31,562, or 2.6 percent. A law took effect Oct. 17 making it harder for individuals to avoid paying debts. Personal bankruptcies surged in the weeks ahead of the change.

snip>

"To the extent Congress had a goal of simply reducing bank-
ruptcy filings, the proponents of the law can stand up and say, 'Hey, we've set out to achieve this, and we have,' " said Samuel Gerdano of the American Bankruptcy Institute.

more...

Yeah, so what about foreclosure rates?

http://news.google.com/news?hl=en&ned=us&q=foreclosures&ie=UTF-8

[Buttercup McToots]

37. Massive and illegal manipulation of the market by a major short seller

The Daily Resource...Doug Hornig


snip>
The ever-interesting Ted Butler, silver’s überbull, has been warning of massive and illegal manipulation of the market by a major short seller for quite some time. In an interview published Friday on Silverseek.com, Butler says that he now believes he knows who’s holding the short position: China.

Asked why he thinks that, Butler said, “They fit the profile. The quantities held short by the very biggest traders on the COMEX are country-sized, rather than company-sized. Besides, China has turned up in the recent past as having mega-short positions in copper and oil.”

http://www.kitcocasey.com/displayArticle.php?id=917

x(

[54anickel]

38. Citigroup, Bank of America, JPMorgan Squeezed by Bond Market

http://www.bloomberg.com/apps/news?pid=20601103&sid=aM6rUS3g4Ui0&refer=us

Aug. 29 (Bloomberg) -- Citigroup Inc., Bank of America Corp. and JPMorgan Chase & Co. are among the biggest losers in the bond market, where the largest U.S. banks' relative borrowing costs are the highest in three years.

A slowing economy has prompted investors to demand an additional 11 basis points of interest, or $1.1 million for each $1 billion face amount, on bank bonds since February, according to data compiled by Merrill Lynch & Co. The widening yield premium amounts to a loss of $7.3 billion on bondholders' principal the past six months and a profit squeeze for banks, which make money on the difference between their borrowing and lending charges.

Bank bonds, which account for almost one fifth of the $5.2 trillion U.S. corporate bond market, are heading for their worst year since 1999 after the Federal Reserve increased interest rates 17 times, the government reported a 4.3 percent slump in new-home sales in July and oil prices rose 14 percent since January. Slower growth may cause bond defaults to quadruple by 2008, adding to bank losses, Standard & Poor's says.

``Whenever you see some weakness in the economy, that has to get into investors' minds,'' said Alvaro de Molina, chief financial officer of Bank of America, in an Aug. 24 interview. Some fund managers may be questioning whether the Fed has pushed the economy into a recession, de Molina said.

snip>

Sell Bank Bonds

Investors ought to sell bank bonds or buy derivatives :spray:that would benefit from a decline in the price of debt issued by Wachovia and Citigroup, said Barclay's Capital analysts Melody Vogelmann and Julie Schultz in an Aug. 17 report.

more...

[54anickel]

42. Too many bond bulls

Commentary: Don't bet that 'this time is different' and rally will continue

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B85A4280F%2D420A%2D4B5E%2D8853%2D7E774E8434C1%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

snip>

In this regard, I should note that the bond market's rally this summer has been a big exception to the contrarian view of how the world should work. The HBNSI was already relatively high in June when the rally began, suggesting to contrarians that the bond market was more likely to decline than go up.

And yet, as we now know, far from declining since late June, the bond market has rallied strongly.

In the wake of this rally that took the contrarians by surprise, we have a choice: We can decide the world has changed and bet that the bond timers on balance are now getting it right, or instead bet that what we've witnessed over the last two months is the exception that soon will prove the rule.

Betting the first way seems dangerously close to believing that "this time is different."

more...

[AnneD]

93. Just a trife I thought you might be interested in...

August 28, 2006 at 07:59:32

America's Disappearing Wealth

by Carlos T. Mock, MD


Federal borrowing eventually results in a transfer of income from U.S. taxpayers to the investors who hold the Treasury bonds. As long as Americans own the bonds, the transfer is simply from one American to another. Bondholders may get richer, while taxpayers who don't own bonds get poorer. But shuffling the income between the two groups doesn't reduce America's overall wealth.

Today, however, 43 percent of the United States' publicly held debt of $4.8 trillion is held abroad, mainly by central banks in Japan, China, and Britain and by offshore hedge funds. That's up from a 30 percent share in 2001, an extraordinary increase.

Indeed, during the Bush years, 73 percent of new government borrowing has been from abroad. Paying the interest on the foreign- owned portion of the debt will be a burden on future generations of Americans, draining their wallets, and siphoning off America's wealth.

<snip>

Unless Congress stops spending precious time debating Gay Marriage and Flag Burning and starts confronting President Bush on the deficit (both trade and budgetary) we run the chance of a real fiscal crisis and a recession.

I know it is old news for us but I am seeing more and more of these type articles circulating about.









http://www.opednews.com/articles/opedne_carlos_t_060827_america_s_disappeari.htm


Edited because OOOPS hit the wrong key :blush:

[Ghost Dog]

41. Carlyle Group strong candidate for US Ports Purchase

http://www.gulf-news.com/business/Shipping/10063336.html
(DU here: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x2002265 )

<snip> Among the strongest contenders for inclusion in the second round of bidding are understood to be the infrastructure fund of Morgan Stanley, the investment bank; Carlyle Group, the private equity group; and Carrix, parent of SSA Marine, a Seattle-based container terminal operator. The shortlist marks the start of the most intense phase of the sale process for the five container terminal operations and other US cargo and passenger-handling businesses. DP World acquired the businesses as part of its takeover this year of the P&O, the UK container terminal.

/...

[54anickel]

65. Who would have thought? ....n/t

[AnneD]

95. Didn't we post about that...

either here or on another DU thread when the port deal first came up? I think it was mentioned here.

[UpInArms]

44. Bayer 2Q Profit Up; 1500 North American Job Cuts Planned

http://abcnews.go.com/Business/print?id=2369006

BERLIN - German chemical and drug maker Bayer AG said Tuesday its second-quarter net profit increased by 11.3 percent, helped by sales growth at its health-care unit.

Bayer also announced a restructuring plan for its CropScience unit that will lead to about 1,500 job cuts by the end of 2009, mainly in North America.

Leverkusen, Germany-based Bayer's net income for the April-June period was 452 million euros ($578 million), up from 406 million a year earlier. That was slightly short of the 461 million euros ($590 million) analysts surveyed by Dow Jones Newswires had predicted.

Total sales rose by 5.8 percent to 7.07 billion euros ($9.04 billion) from 6.69 billion euros. Bayer's core health care unit posted the strongest advance, with sales increasing by 12.7 percent.

<snip>

Second-quarter earnings before interest, taxes and amortization rose by 14 percent to 928 million euros ($1.19 billion), beating analysts' forecast of 871 million euros ($1.1 billion).

...more...

[UpInArms]

49. 10:13 EST shocky numbers and blather

Dow 11,341.28 -10.73 (-0.09%)
Nasdaq 2,159.20 -1.50 (-0.07%)
S&P 500 1,299.77 -2.01 (-0.15%)
10-Yr Bond 4.813 +0.016 (+0.33%)

NYSE Volume 337,604,000
Nasdaq Volume 222,271,000

10:00 am : Major averages are still fluctuating around the flat line as unconvincing leadership continues to dictate early action. Of the seven sectors trading higher, none are posting gains of more than 0.3% and the best performers -- Telecom and Materials -- are also among the smallest weighted sectors within the S&P 500. Energy, however, is noticeably lower (-0.7%) in sympathy with a 1.4% decline in oil prices, which is welcome news for consumers; but the subsequent loss of leadership from refiners, drillers and explorers removes notable support behind the S&P 500's 4.2% year-to-date advance, roughly 2% of which has been realized this month alone.DJ30 +1.76 NASDAQ +1.65 SP500 -0.44 XOI -0.8% NASDAQ Dec/Adv/Vol 1089/1266/180 mln NYSE Dec/Adv/Vol 1042/1489/150 mln

09:40 am : Stocks open with little fanfare as an extremely light news day does not offer investors much of a reason to extend yesterday's broad-based buying efforts, especially ahead of key economic data. First up will be August Consumer Confidence (10:00 ET), which has some market-moving potential despite the weak correlation between consumer confidence and spending, while the minutes from the August 8 FOMC meeting (14:00 ET) will be studied carefully for comments relating to the debate on inflation and the pace of economic activity. DJ30 -5.60 NASDAQ -0.86 SP500 -1.02 NASDAQ Vol 66 mln NYSE Vol 59 mln

[54anickel]

52. Blistering Drought Ravages Farmland on Plains

http://www.nytimes.com/2006/08/29/us/29drought.html?ref=business

MITCHELL, S.D. — With parts of South Dakota at its epicenter, a severe drought has slowly sizzled a large swath of the Plains States, leaving farmers and ranchers with conditions that they compare to those of the Dust Bowl of the 1930’s.

The drought has led to rare and desperate measures. Shrunken sunflower plants, normally valuable for seeds and oil, are being used as a makeshift feed for livestock. Despite soaring fuel costs, some cattle owners are hauling herds hundreds of miles to healthier feedlots. And many ranchers are pouring water into “dugouts” — natural watering holes — because so many of them (up to 90 percent in South Dakota, by one reliable estimate) have gone dry.

Gov. Michael Rounds of South Dakota, who has requested that 51 of the state’s 66 counties be designated a federal agricultural disaster area, recently sought unusual help from his constituents: he issued a proclamation declaring a week to pray for rain.

“It’s a grim situation,” said Herman Schumacher, the owner of a livestock market in Herreid, S.D., a small town near the North Dakota line where 37,000 head of cattle were sold from May through July, compared with 7,000 in the corresponding three months last year. “There’s absolutely no grass in the pastures, and the water holes are all dried up. So a lot of people have no choice but to sell off their herds and get out of the business.”

more...

[Ghost Dog]

57. More on this part of the global drought here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2482017#2482313

[AnneD]

61. One can't help

but think of the great depression. Many of my relatives were Dust Bowl Okies. They went to work in the orchards of Arizona. The stories they would tell about the Dust Bowl and the Depression were horrific. We may be in that cycle now. I can't help but think about it when I read stories like these.

[54anickel]

63. Thanks again GD. Makes me think of that article a couple of weeks

ago that mentioned grain reserves being at levels to last 57 days. We aren't under a severe drought in my neck of the woods, but we've lost almost all of our farmland to development. I read somewhere that the water table in our county is the fastest depleting in the country as well. Not to mention the problem of radon in the water tables.

[kineneb]

85. shades of the Dust Bowl & 1930s...n/t

[54anickel]

54. Monsanto buys 'Terminator' seeds company

http://www.321gold.com/editorials/engdahl/engdahl082906.html

The United States Government has been financing research on a genetic engineering technology which, when commercialized, will give its owners the power to control the food seed of entire nations or regions. The Government has been working quietly on this technology since 1983. Now, the little-known company that has been working in this genetic research with the Government's US Department of Agriculture -- Delta & Pine Land -- is about to become part of the world's largest supplier of patented genetically-modified seeds (GMO), Monsanto Corporation of St. Louis, Missouri.

Relations between Monsanto, Delta & Pine Land and the USDA, on closer scrutiny, show the deep and dark side of the much-heralded genetic revolution in agriculture. It proves deep-held suspicions that the Gene Revolution is not about 'solving the world hunger problem' as its advocates claim. It's about handing over control of the seeds for mankind's basic food supply - rice, corn, soybeans, wheat, even fruit, vegetables and cotton - to privately owned corporations. Once the seeds and their use are patented and controlled by one or several private agribusiness multinationals, it will be they who can decide whether or not a particular customer-let's say for argument, China or Brazil or India or Japan-whether they will or won't get the patented seeds from Monsanto, or from one of its licensee GMO partners like Bayer Crop Sciences, Syngenta or DuPont's Pioneer Hi-Bred International.

While most of us don't bother to reflect on where the corn in the box of Kellogg's Corn Flakes or the rice in a box of Uncle Ben's Converted Rice come from, when we grab it from the supermarket shelf, they all must originate with seeds. Seeds can either be taken by a farmer from the previous season' seeds, and planted to produce the next harvest. Or, seeds can be bought new each harvest season, from the companies which sell their seeds.

The advent of commercial GMO seeds in the early 1990's allowed companies like Monsanto, DuPont or Dow Chemicals to go from supplying agriculture chemical herbicides like Roundup, to patenting genetically altered seeds for basic farm crops like corn, rice, soybeans or wheat. For almost a quarter century, since 1983, the US Government has quietly been working to perfect a genetically engineered technique whereby farmers would be forced to turn to their seed supplier each harvest to get new seeds. The seeds would only produce one harvest. After that the seeds from that harvest would commit 'suicide' and be unusable.

There has been much hue and cry, correctly so, that this process, patented 'suicide' seeds, officially termed GURTs (Genetic Use Restriction Technologies), is a threat to poor farmers in developing countries like India or Brazil, who traditionally save their own seeds for the next planting. In fact, GURTs, more popularly referred to as Terminator seeds for the brutal manner in which they kill off plant reproduction possibilities, is a threat to the food security as well of North America, Western Europe, Japan and anywhere Monsanto and its elite cartel of GMO agribusiness partners enters a market.

more...

edit to add - sorry for the "blame Clinton" section of the article. The article overall does give one pause to think though. :freak:

[AnneD]

59. I have farmer friends and family...

these seeds have been the topic of some pretty depressing dinner table debates for years now. Most of the family farmers oppose this (at least in our family). It is wrong on so many levels- from a genetic/biodiversity to a moral level (forcing farmers to buy rather than retain their own seeds). As my Grandfather would say-It's an abomination and should be stopped. We will be literally sowing the seeds of our own destruction. Thechnology is what it is, neither good or bad-it depends on it's usage. However, I have little faith that these mega ag companies to do the right thing. They are profit driven.
This is like water companies that try to corner local water markets. Some things are too important to human survival and should be held as trust/not for profit.

[54anickel]

64. Guess we need to start a "pro-life" movement for plants....n/t

[Theres-a]

68. Right on the money

Terrifying.

[AnneD]

88. The REAL reason for these seeds?????

The thought of 'unauthorized' sex happening somewhere in this country drives Christian RW Nuts crazy. God knows what happens when you have all those wandering stamen....... and pollen-do you know what pollen REALLY is....plant seman. We are all victims of blow jobs in this country....oh, I think I just made someones head explode.:spray:

[UpInArms]

62. Schering-Plough to pay $435 mln/conspiracy to make false statements

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B545A9EE1%2D1BD1%2D4A26%2DBF2F%2DE556CF30FE25%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Schering-Plough Corp. (SGP : 20.48, +0.07, +0.3% ) on Tuesday said it will pay $435 million as part of a settlement agreement with the U.S. Attorney's Office for the District of Massachusetts and the Department of Justice. The agreement will settle a federal investigation into the company's sales, marketing and clinical trial practices and programs. Kenilworth, N.J.-based Schering-Plough said its Schering Sales Corp. subsidiary will plead guilty to one count of conspiracy to make false statements to the government and pay a criminal fine of $180 million, and Schering-Plough will pay $255 million to resolve civil aspects of the probe. Schering-Plough said its previously disclosed litigation reserves will be enough to cover the settlement amount.

[54anickel]

66. 12:15 numbers and yada catch up

Dow 11,310.47 -41.54 (-0.37%)
Nasdaq 2,147.52 -13.18 (-0.61%)
S&P 500 1,296.37 -5.41 (-0.42%)
10-yr Bond 4.827 +0.03 (+0.63%)
30-yr Bond 4.968 +0.034 (+0.69%)
NYSE Volume 881,012,000
Nasdaq Volume 649,538,000

12:00 pm : Market continues to languish in negative territory midday as a larger than expected decline in consumer confidence and rising bond yields overshadow easing inflationary pressures tied to another sharp pullback in oil prices to five-month lows.

While oil's decline is welcome news for consumers, especially on the one-year anniversary of Hurricane Katrina and ahead of the Labor Day holiday weekend, which caps off the summer driving season, the subsequent loss of leadership from Energy, is pacing the way lower (-1.3%) among the seven sectors losing ground, removes notable support behind the S&P 500's 4.2% year-to-date advance, 2% of which has been realized this month alone. Crude oil futures are down 1.2% and below $70 a barrel as Tropical Storm Ernesto veers away from oil platforms in the Gulf.

The absence of influential leadership from Financials (-0.8%) is also preventing the bulls from extending yesterday's broad-based buying efforts. Punk Ziegel & Co. downgrading several brokerage firms (e.g. MS -2.5%, MER -1.5%, GS -1.9%, LEH -3.4%, and BSC -2.2%) has left Investment Banks as this morning's third worst performing S&P industry group (-2.1%) while a rise in borrowing costs across the yield curve is weighing on rate-sensitive banks stocks (e.g. BKX -0.8%) and mortgage lenders. The latter group has succumbed to additional pressure after First Horizon National Corp (FHN 38.42 -1.63) warned of weaker than expected Q3 mortgage banking earnings.

Treasuries have been consolidating two months of gains all morning as the market positions itself for this afternoon's bond auction and the minutes from the August 8 FOMC meeting (14:00 ET), which will be studied carefully for comments relating to the debate on inflation and the pace of economic activity. Inflation expectations within the disappointing August consumer confidence report, which dipped to a lower than anticipated read of 99.6 for August -- the lowest level since November, have also weighed on both bonds and stocks. DJ30 -36.50 NASDAQ -13.86 SP500 -5.45 NASDAQ Dec/Adv/Vol 1673/1093/616 mln NYSE Dec/Adv/Vol 1757/1310/528 mln

11:30 am : Sellers remain in control of the morning action as the bulk of industry leadership remains negative. Aside from noticeable declines in Energy and Financials taking a toll on today's trading, the absence of leadership from Technology, as evidenced by the tech-heavy Nasdaq outpacing its blue chip counterparts to the downside, is also stalling follow-through momentum from Monday. With the Tech sector up an impressive 6.9% in August, higher interest rates sparking valuation concerns, especially in growth areas like software (-1.0%) and hardware (-0.7%), are prompting investors to lock in some of their profits. DJ30 -29.62 NASDAQ -11.96 SP500 -4.67 NASDAQ Dec/Adv/Vol 1555/1189/534 mln NYSE Dec/Adv/Vol 1714/1334/454 mln

11:00 am : Stocks bounce off morning lows as the overreaction to economic data with little if any influence on Fed policy subsides a bit. Unfortunately in a market with limited participation, as traders remain cognizant that things can change in a hurry with vacation schedules creating some thin trading conditions, the loss of leadership in the Energy sector (-1.1%) is outweighing a 1.4% pullback in oil prices while further deterioration in the influential Financials sector (-0.6%), already in consolidation mode in sympathy with rising bond yields, has been exacerbated by Punk Ziegel & Co. downgrading several brokerage firms (e.g. MS -2.1%, MER -1.4%, GS -1.6%, LEH -2.6%, and BSC -1.6%). ..XBD -1.2%.DJ30 -21.21 NASDAQ -9.17 SP500 -3.74 XOI -1.3% NASDAQ Dec/Adv/Vol 1593/1055/437 mln NYSE Dec/Adv/Vol 1680/1320/370 mln

10:30 am : Indices spike lower following a larger than expected decline in consumer sentiment. At the top of the hour, the Conference Board's monthly survey to ascertain the level of consumer confidence dipped to lower than anticipated 99.6 for August -- the lowest level since November. Even though the data don't really say much about the economic outlook and don't correlate well with short-term consumer spending trends, expectations for inflation in the next year rising to 5.5% from 5.1% in July -- the highest level since October, has merely exacerbated early uncertainty heading into this afternoon's release of the FOMC Minutes. DJ30 -32.10 NASDAQ -11.07 SP500 -4.51 NASDAQ Dec/Adv/Vol 1282/1283/316 mln NYSE Dec/Adv/Vol 1319/1589/264 mln

10:00 am : Major averages are still fluctuating around the flat line as unconvincing leadership continues to dictate early action. Of the seven sectors trading higher, none are posting gains of more than 0.3% and the best performers -- Telecom and Materials -- are also among the smallest weighted sectors within the S&P 500. Energy, however, is noticeably lower (-0.7%) in sympathy with a 1.4% decline in oil prices, which is welcome news for consumers; but the subsequent loss of leadership from refiners, drillers and explorers removes notable support behind the S&P 500's 4.2% year-to-date advance, roughly 2% of which has been realized this month alone.DJ30 +1.76 NASDAQ +1.65 SP500 -0.44 XOI -0.8% NASDAQ Dec/Adv/Vol 1089/1266/180 mln NYSE Dec/Adv/Vol 1042/1489/150 mln


Advances & Declines
NYSE Nasdaq
Advances 1310 (40%) 1084 (36%)
Declines 1804 (55%) 1692 (57%)
Unchanged 157 (4%) 184 (6%)

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

Up Vol* 318 (39%) 172 (27%)
Down Vol* 487 (59%) 436 (70%)
Unch. Vol* 10 (1%) 8 (1%)

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

New Hi's 91 53
New Lo's 33 38

[54anickel]

69. Gold Falls as Declining Energy Costs Ease Inflation Concerns

http://www.bloomberg.com/apps/news?pid=20601012&sid=a69_h0wCVABU&refer=commodities

Aug. 29 (Bloomberg) -- Gold in New York fell to a one-month low as declining energy costs reduce the appeal of the metal as a hedge against inflation.

Gold and oil have generally moved in lockstep this year. Crude oil traded at a one-week low as Tropical Storm Ernesto veered away from oil platforms in the U.S. Gulf region, reducing concerns over supply disruptions. Before today, gold had climbed 20 percent this year, mostly moving in tandem with oil's 16 percent gain.

``If you're buying gold along with crude for the inflation, you're going to be disappointed,'' said Frank Lesh, a trader at FuturePath Trading LLC in Chicago.

snip>

``Commodity prices are plunging, not rising, and the bond market would have us believe that inflationary pressures are waning, not waxing,'' said Dennis Gartman, gold trader, economist and editor of the Suffolk, Virginia-based Gartman Letter.

snip>

Gold may fall should central banks in Europe sell the metal before a Sept. 26 deadline. Under an accord known as the Washington Agreement, European central banks agreed to limit sales to 500 tons a year. They haven't reached the target yet.

more....


OK, so energy - which the Fed excludes from their inflation data - drops. Somehow that means that inflation expectations - which doesn't take energy into consideration - drops. Yet the mantra through this mal-administration has been how strong and resilient the economy has been and inflation has been tame because energy prices have not been feeding through the economy. So which is it really? I'm soooo confused. Oh yeah, I forgot I need the attention span of a gnat for any of this shit to make sense. :eyes:

[54anickel]

71. Lawyers Will Subpeona Bush White House in Phone Company Spying Case

http://releases.usnewswire.com/GetRelease.asp?id=71393

snip>

WHO: Bruce Afran and Carl Mayer, attorneys for hundreds of plaintiffs in litigation against the Bush Administration and the phone companies

DETAILS: Two lawyers who brought the first lawsuit against the Bush Administration, Verizon and ATT for illegally examining the phone records of virtually every American citizen will announce today that they are serving subpoenas on the Bush White House and on Verizon.

"We are subpoenaing the White House because we have developed evidence that the Bush Administration began unlawful efforts to obtain Americans' private phone records prior to 9/11/01 and the White House must disclose documents relevant to that claim," said Afran. "We believe that Verizon had extensive involvement in illegally disclosing the records of millions of Americans."

"We are going to determine with these subpoenas whether the Bush administration has unlawfully targeted journalists, peace activists, libertarians, members of congress or generated an 'enemies list' by creating the most massive domestic spying operation in America's history," said Mayer.

more...

:shrug: I read that as a whether or NOT Bushco is guilty of wrong-doing. Hate to be so cynical but in an election year with security hype as the platform I've gotta ask who's paying these guys.

[54anickel]

72. OT - In drunken-city rankings, Milwaukee's best

Hurray for my little town's largest suburb!!!

http://www.suntimes.com/output/news/cst-nws-drinking25.html

The Web site for Forbes magazine ranked Milwaukee as "America's drunkest city" and placed Chicago at No. 6.

Forbes.com came up with its calculations by ranking state liquor laws, and counting up admitted drinkers and Alcoholics Anonymous meetings in 35 metropolitan areas.

But a beer-swilling town like Chicago at No. 6? Someone at Forbes.com must have had a few too many, local drinkers and bartenders said.

"Obviously, they're talking to the wrong people. Maybe they tried to call some of us, but we were passed out on the couch," retired barkeep Marty Rogers said.

snip>

'Worst drinkers are all liars'

And surprisingly, party towns Las Vegas and New York City ranked No. 14 and No. 32 respectively.

"It's a bit disappointing," said Brian Johnson, bartender at Rossi's Bar on North State. "They might make the beer up there , but we drink it down here."

Sorry losers!!! :P So why would anyone want to argue "No they're not WE ARE!!!" :crazy:

[UpInArms]

74. Treas Auction of $22 billion 2-year has disappointing indirect bid

1:07 PM ET 8/29/06 2-YR TREASURY NOTE AUCTION HAS 22.8% INDIRECT BID

1:06 PM ET 8/29/06 2-YR TREASURY NOTE AUCTION HAS MEDIAN YIELD 4.898%

1:05 PM ET 8/29/06 <$TNX> 2-YR TREASURY NOTE AUCTION HAS 2.32 BID-TO-COVER RATIO

1:06 PM ET 8/29/06 2-YR TREASURY NOTE AUCTION PRODUES HIGH YIELD 4.921%

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B02313E64%2D71D3%2D407A%2D8E03%2D306A9A7863D9%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) - An afternoon Treasury auction of $22 billion in two-year Treasury notes attracted a bid-to-cover -- or bids rendered to bids accepted -- ratio of 2.32. The indirect bid, a closely watched category that includes foreign central banks, was 22.8%. Research firm Action Economics said the sale was "mixed" with a "solid" bid-to-cover and a "disappointing" indirect bid. The auction also produced a high yield of 4.921% and a median yield of 4.898%.

[54anickel]

75. Median yield of 4.898? And the 10 year is now at 4.835.

[54anickel]

77. 2:07 update

Dow 11,324.32 -27.69 (-0.24%)
Nasdaq 2,153.23 -7.47 (-0.35%)
S&P 500 1,298.38 -3.40 (-0.26%)
10-yr Bond 4.831 +0.034 (+0.71%)
30-yr Bond 4.973 +0.039 (+0.79%)
NYSE Volume 1,254,993,000
Nasdaq Volume 916,944,000

2:00 pm : Market continues to tread water and sport modest losses as investors anxiously wait to see what the FOMC minutes, which are due out momentarily, say about inflation and the direction of Fed policy. Even though the markets have priced in a high probability that policy makers will not raise rates again, that assumption could be undermined somewhat with the minutes since the details have the ability to alter policy expectations for the Fed's next meeting on September 20.DJ30 -34.74 NASDAQ -10.12 SP500 -4.59 NASDAQ Dec/Adv/Vol 1606/1268/868 mln NYSE Dec/Adv/Vol 1730/1450/752 mln

1:30 pm : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges. The market's holding pattern has been further evidenced in the A/D line, as decliners on the NYSE hold a slim 17-to-14 edge over advancers while declining issues on the Nasdaq still outpace advancing issues by a 16-to-11 margin. The ratio of down to up volumes also paints an underlying negative tone at the Big Board and the Composite; but another day of limited participation provides little conviction behind the bears' efforts to lock in surprising market gains during what is historically one of the worst months for stocks. DJ30 -34.34 NASDAQ -11.02 SP500 -4.77 NASDAQ Dec/Adv/Vol 1667/1189/811 mln NYSE Dec/Adv/Vol 1746/1407/699 mln

1:00 pm : More of the same for stocks as the major averages settle into a relatively tight range ahead of the minutes from the August 8 Fed meeting. Bonds, though, continue to weaken ahead of today's bond auction and FOMC Minutes which may show other Fed officials sympathized with Richmond Fed President Jeffrey Lacker, who opposed the decision to leave interest rates unchanged for the first time in more than two years. The 10-yr note is down 10 ticks to yield 4.83%.DJ30 -38.45 NASDAQ -12.08 SP500 -5.25 NASDAQ Dec/Adv/Vol 1661/1159/746 mln NYSE Dec/Adv/Vol 1761/1379/638 mln

12:30 pm : Not much has changed as investors work their way through the New York lunch hour. Market breadth continues to favor the bears while the majority of economic sectors remain negative. Consumer Staples, however, has recently inched into the green, getting a lift from Distillers (+2.2%), Brewers (+1.2%) and Personal Products (+1.0%) -- three of today's top ten performing S&P industry groups. Be that as it may, the sector has yet to attract enough defensive-minded investors to have much of an impact on the broader market. DJ30 -38.58 NASDAQ -13.02 SP500 -5.52 NASDAQ Dec/Adv/Vol 1673/1126/682 mln NYSE Dec/Adv/Vol 1775/1360/582 mln

[UpInArms]

79. look at the spike in just those few seconds

between our simul-post

:eyes:

[54anickel]

81. They are headed for the water line quickly. I give them a few minutes

more.

On edit, whoopsie - maybe not. They surfaced for air and went right back down.

[UpInArms]

78. 2:07 EST Knees Jerking for the FOMC

Dow 11,332.96 -19.05 (-0.17%)
Nasdaq 2,154.53 -6.17 (-0.29%)
S&P 500 1,299.21 -2.57 (-0.20%)
10-Yr Bond 4.831 +0.034 (+0.71%)

NYSE Volume 1,271,648,000
Nasdaq Volume 930,281,000

minutes, which are due out momentarily, say about inflation and the direction of Fed policy. Even though the markets have priced in a high probability that policy makers will not raise rates again, that assumption could be undermined somewhat with the minutes since the details have the ability to alter policy expectations for the Fed's next meeting on September 20.DJ30 -34.74 NASDAQ -10.12 SP500 -4.59 NASDAQ Dec/Adv/Vol 1606/1268/868 mln NYSE Dec/Adv/Vol 1730/1450/752 mln

1:30 pm : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges. The market's holding pattern has been further evidenced in the A/D line, as decliners on the NYSE hold a slim 17-to-14 edge over advancers while declining issues on the Nasdaq still outpace advancing issues by a 16-to-11 margin. The ratio of down to up volumes also paints an underlying negative tone at the Big Board and the Composite; but another day of limited participation provides little conviction behind the bears' efforts to lock in surprising market gains during what is historically one of the worst months for stocks. DJ30 -34.34 NASDAQ -11.02 SP500 -4.77 NASDAQ Dec/Adv/Vol 1667/1189/811 mln NYSE Dec/Adv/Vol 1746/1407/699 mln

[54anickel]

82. Hurrah!!! No more rate increases - PARTY!!!!.......Oh wait a minute

what's this talk about slower growth? Bwahahahaha! :evilgrin:

[54anickel]

86. 2:46 and a second attempt at the waterline

Dow 11,348.01 -4.00 (-0.04%)
Nasdaq 2,162.01 +1.31 (+0.06%)
S&P 500 1,300.91 -0.87 (-0.07%)
10-yr Bond 4.809 +0.012 (+0.25%)
30-yr Bond 4.953 +0.019 (+0.39%)
NYSE Volume 1,492,665,000
Nasdaq Volume 1,105,028,000

2:30 pm : Indices initially spike to session lows following the release of the FOMC Minutes, but almost as quickly reverse course and hit their best levels of the afternoon. In other words, the market remains choppy as the minutes suggest the Fed is more likely to raise rates later this year than the financial markets currently presume. An excerpt from the text reads: "Many members thought that the decision to keep policy unchanged at the meeting was a ‘close call' and noted that additional firming may well be needed." Fed officials also noting that "inflation risks remained dominant and that consequently keeping policy unchanged at this meeting did not necessarily mark the end of the tightening cycle," has also left investors uncertain as to whether or not the Fed will remain on hold, especially since only one month (July) of tame inflation data does not constitute a trend and leaves the door open for disappointment.DJ30 -17.29 NASDAQ -4.45 SP500 -2.26 NASDAQ Dec/Adv/Vol 1368/1513/1.05 bln NYSE Dec/Adv/Vol 1601/1596/888 mln

[54anickel]

90. 3:27 and everyone emerges from the red sea. All hail Ben!!!!

Dow 11,366.66 +14.65 (+0.13%)
Nasdaq 2,167.23 +6.53 (+0.30%)
S&P 500 1,303.43 +1.65 (+0.13%)
10-yr Bond 4.783 -0.014 (-0.29%)
30-yr Bond 4.93 -0.004 (-0.08%)
NYSE Volume 1,722,724,000
Nasdaq Volume 1,282,608,000

3:00 pm : Market continues to pare its losses as buyers return from the sidelines, cautiously taking a bullish cue from a turnaround in Treasuries. Within the last 30 minutes, bonds have turned positive across the curve, pushing the yield on the 10-yr note (+02/32) back to 4.78%. Despite the FOMC minutes undermining the high degree of confidence in the financial markets that the Fed is done raising rates, it appears bond traders are keying in on moderating aggregate demand and long-term inflation expectations being contained. Nonetheless, it is also worth noting that below average volumes in both bonds and stocks lend little credence behind the market's late-day recovery efforts. DJ30 -6.56 NASDAQ +1.11 SP500 -1.32 NASDAQ Dec/Adv/Vol 1194/1721/1.16 bln NYSE Dec/Adv/Vol 1311/1912/986 mln

[UpInArms]

92. happy closing numbers and blather

Dow 11,369.94 +17.93 (+0.16%)
Nasdaq 2,172.30 +11.60 (+0.54%)
S&P 500 1,304.28 +2.50 (+0.19%)
10-Yr Bond 4.783 -0.014 (-0.29%)

NYSE Volume 2,100,242,000
Nasdaq Volume 1,629,218,000

What was shaping up to be a typical dog day of summer, initially fueled by a decline in consumer confidence, rising bond yields and the absence of notable industry leadership, eventually ended on a surprisingly upbeat note. Be that as it may, another light volume day offered little conviction behind late-day recovery efforts that were fueled by FOMC Minutes that actually undermined the high degree of confidence in the financial markets that the Fed is done raising rates, as Tuesday's turnaround may not last long with a deluge of even more influential economic data to digest later in the week.

Per usual when the earnings calendar is absent any noteworthy names, investors waited for this week's first economic report to set the tone for the day. At 10:00 ET, the Conference Board's monthly survey to ascertain the level of consumer confidence dipped to a lower than expected 99.6 for August -- the lowest level since November. Even though the data don't really say much about the economic outlook and don't correlate well with short-term consumer spending trends, expectations for inflation in the next year rising to 5.5% from 5.1% in July -- the highest level since October -- merely exacerbated early uncertainty heading into this afternoon's release of the FOMC Minutes and kept bond yields near session highs.

Then, shortly after 2:00 ET, the handful of market makers that decided not to go on vacation this week began sifting through the Federal Reserve Board's eight-page report detailing the minutes from the August 8 FOMC meeting. Since the minutes have the ability to alter policy expectations for the Fed's next meeting on September 20, many were looking to see what (if any) other Fed officials sympathized with Richmond Fed President Jeffrey Lacker, who opposed the decision to leave interest rates unchanged for the first time in more than two years.

While there was an acknowledgement in the minutes that further rate hikes may be needed, with many members citing the August pause as a "close call," investors latched on to comments pertaining to the possibility of "economic growth below potential over the next six quarters" due to past tightenings as a signal that the Fed is likely to remain on hold when it meets again next month.

The news sparked turnarounds in influential sectors like Technology and Consumer Discretionary, and strengthened early momentum in defensive-oriented areas like Health Care and Consumer Staples, providing just enough of a lift to offset weakness in the S&P 500's most influential sector -- Financials -- and Energy, which succumbed to more consolidation amid another pullback in oil prices. Crude oil futures fell 1.1% and below $70 a barrel as Tropical Storm Ernesto steering clear of oil platforms in the Gulf eased concerns about more supply disruptions just one year removed from the destruction caused by Hurricane Katrina.

Again, while the rate outlook was viewed favorably today, it is our belief that the FOMC Minutes suggest the Fed is more likely to raise rates later this year than the financial markets currently presume. We'll get a better read on things with the core-PCE index on Thursday and the August jobs report on Friday. BTK +0.5% DJ30 +17.93 DJTA -0.1% DOT +0.4% NASDAQ +11.60 NQ100 +0.2% R2K +1.2% SOX +1.7% SP400 +0.5% SP500 +2.50 XOI -0.9% NASDAQ Dec/Adv/Vol 1053/1941/1.60 bln NYSE Dec/Adv/Vol 1087/2194/1.37 bln

[AnneD]

96. Thanks to all...

this was a meaty thread today complete with lots of juicy tid bits. Cheers :toast:

[54anickel]

97. So a year and a half of growth below potential is a good thing and

stocks are somehow seen as a bargain? Buy, buy, buy!!! I've still got that "high number of short sellers" in the back of my mind. Along with the history of the last week of August. :shrug: