STOCK MARKET WATCH, Thursday August 28

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday August 28, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 146
DAYS SINCE DEMOCRACY DIED (12/12/00) 2776 DAYS
WHERE'S OSAMA BIN-LADEN? 2501 DAYS
DAYS SINCE ENRON COLLAPSE = 2792
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.
$1 USD = EUR 1.06678
$1 USD = JPY 116.6200

AT THE CLOSING BELL ON August 27, 2008

Dow... 11,502.51 +89.64 (+0.79%)
Nasdaq... 2,382.46 +20.49 (+0.87%)
S&P 500... 1,281.66 +10.15 (+0.80%)
Gold future... 834.00 +5.90 (+0.71%)
30-Year Bond 4.38% -0.01 (-0.27%)
10-Yr Bond... 3.77% -0.01 (-0.32%)






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

---

Read more: du

[truthisfreedom]

1. LOVE the toon.

One house, OBAMA'S HOUSE!

[ozymandius]

5. Thanks.

It does hit a high note after last night's events, eh?

[DemReadingDU]

18. Great toon for today!

This has been a good week for the Democrats, really excited for tonight! We've been watching C-span, and have seen some amazing speeches that haven't been shown on the regular tv stations.

[ozymandius]

2. Market WrapUp

The Worst Is Yet to Come
BY CHRIS PUPLAVA

Last week I took a look at why consumers were so depressed. In short, my conclusion was that consumers were finally coming to terms with their balance sheets and this wakeup call: that you can’t borrow your way indefinitely to maintain ones standard of living. Consumers will be forced to save and consume less as the liquidity trough of cheap credit has been removed. As Warren Buffet said, “Only when the tide goes out do you discover who’s been swimming naked.” The U.S. consumer has been swimming naked for several decades and is now scrambling for cover; so too our financial institutions that also leveraged up as risk management became a word lost in their vocabulary. The markets are down between 15% and 20% and I believe there is more to come, with reasons highlighted below.

Credit Crisis Continues

Chief among the reasons why the markets are heading lower is that housing has not bottomed and credit continues to be scarce. Financial losses will plague the market as long as housing prices continue to decline. Housing prices are not likely to stabilize until greater credit availability increases the pool of marginal buyers. Right now commercial banks are raising standards on both prime and subprime mortgages, effectively squeezing out buyers of lower credit worthiness, and so goes the vicious feed back loop. Falling home prices lead to greater bank losses who then tap the financial markets and Federal Reserve for capital to replace their losses rather than using capital for issuing new loans. A reduction in credit for loans and higher credit standards reduces available demand for homes and contributes to further home price declines. We have witnessed a rapid decline in bank credit growth as well as credit tightening across all loan types to levels not seen since the last consumer led recession of 1991 as shown in the figures below.

-see chart-

....

The banks are now paying for their complete lapse in lending standards as financial losses continue to mount. Total commercial bank delinquent loans and leases have surpassed levels seen in the prior recession. Moreover, the rate of growth in noncurrent loans and leases is one for the record books as current deterioration in bank loans surpasses the rates seen in the prior two recessions.

...

The FDIC Q2 2008 Quarterly Banking Profile attests to the current financial turmoil seen by commercial banks, with some of the headlines from the report given below.

* Second-Quarter Earnings Are 87 Percent Below Year-Earlier Level
* Noncurrent Loan Rate Rises Above 2 Percent for the First Time Since 1993
* Capital Growth Slows Despite Cutbacks in Dividends
* Net Charge-Off Rate Rises to Highest Level Since 1991
* Growth in Small Business Loans Slowed in the Last 12 Months
* Deposits Decline in Domestic Offices
* Two More Banks Fail in the Second Quarter

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

[Demeter]

16. The First Step Out of the Morass Is Getting Rid of Said Ass

and all his minions. When the PTB stop permitting Bush and Cheney to occupy public space, then we will se some improvement, and so will they. What are they waiting for?

[ozymandius]

3. Today's Reports

08:30 Chain Deflator-Prel. Q2
Briefing.com 1.1%
Consensus 1.1%
Prior 1.1%

08:30 GDP-Prel. Q2
Briefing.com 2.8%
Consensus 2.7%
Prior 1.9%

08:30 Initial Claims 08/23
Briefing.com 425K
Consensus 425K
Prior 432K

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

[UpInArms]

23. Initial Claims @ 425,000 - last wk rev'd up 3,000 - GDP is now a big f'ing rev'd joke

01. U.S. Q2 after-tax corporate profits weakest since Q3 '05
8:30 AM ET, Aug 28, 2008

02. U.S. Q2 before-tax corporate profits down 2.4%
8:30 AM ET, Aug 28, 2008

03. U.S. Q2 GDP revisions due to trade, inventories
8:30 AM ET, Aug 28, 2008

04. U.S. Q2 core PCE price index up 2.1%, unrevised vs prev est.
8:30 AM ET, Aug 28, 2008

05. U.S. Q2 GDP fastest since Q3 2007
8:30 AM ET, Aug 28, 2008

06. U.S. Q2 GDP above 2.7% expected
8:30 AM ET, Aug 28, 2008

07. U.S. Q2 GDP up 3.3% vs. 1.9% prev. est..
8:30 AM ET, Aug 28, 2008

08. U.S. initial state jobless claims fall 10,000 to 425,000
8:30 AM ET, Aug 28, 2008

[Roland99]

27. Considering how much MEW was a part of GDP being above ZERO.... WTF?!??!

[Roland99]

32. Ah, the old DEBT-BASED Economic Stimulus Checks.

Gee...let's just keep kiting checks forever!

Deficits Don't Matter!!!

[54anickel]

54. U.S. Economy Grew Faster Than Previously Estimated (but it's all downhill from here)

http://www.bloomberg.com/apps/news?pid=20601068&sid=ad.8VnAUsobA&refer=economy

Aug. 28 (Bloomberg) -- The U.S. economy expanded at a faster pace than previously estimated in the second quarter, helped by surging exports and a smaller decline in inventories.

The 3.3 percent annualized increase in gross domestic product from April through June was higher than forecast and compares with an advance estimate of 1.9 percent issued last month, the Commerce Department said today in Washington. The economy grew 0.9 percent in the first quarter.

Record exports and the temporary stimulus from the tax rebates prevented the economy from stalling as housing slumped and companies cut expenditures. Consumer spending is now waning and slower growth abroad dims the outlook for foreign sales, signaling last quarter will be the year's highpoint.

``Outside of trade, the economy is considerably weaker,'' said Carl Riccadonna, an economist at Deutsche Bank Securities Inc. in New York. ``When you look at the spending, it looks terrible for the second half of the year.''

The Labor Department said separately that initial claims for unemployment insurance dropped to 425,000 last week, matching economists' forecasts, from 435,000 the previous week. The level remains well above the 321,000 average of last year, and continues to indicate a weakening job market.

snip>

Today's report also included a first look at corporate profits for the second quarter. Earnings adjusted for the value of inventories and depreciation of capital expenditures, known as profits from current production, decreased 2.4 percent to an annual rate of $1.56 trillion. Earnings were down 7 percent from the same time last year, the biggest decrease since the 2001 recession.

more...

[ozymandius]

4. Oil rises in Asia on worries Gustav may strengthen

SINGAPORE - Oil prices rose above $119 a barrel Thursday in Asia on fears that Tropical Storm Gustav could strengthen on its way toward crude and natural gas rigs and refineries in the Gulf of Mexico.

Royal Dutch Shell PLC said it's evacuating some 300 workers from offshore Gulf rigs, while BP PLC was also removing personnel from the region that's home to about a quarter of U.S. crude production and much of its natural gas.

.....

Oil prices were also supported by a weaker dollar, which boosted the demand for oil among investors who buy commodities as a hedge against inflation. The euro gained to $1.4790 while the dollar fell to 108.82 yen.

In other Nymex trading, heating oil futures rose 1.73 cent to $3.279 a gallon, while gasoline prices gained 1.83 cent to $3.085 a gallon.

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

[ozymandius]

7. China, Iraq reach $3 billion oil service deal

SHANGHAI, China - China and Iraq have signed a $3 billion deal revising an earlier agreement for China's biggest oil company to help develop the Ahdab oil field, according to a statement from the Iraqi Embassy in Beijing.

The deal, restoring a project canceled after the 2003 U.S.-led invasion of Iraq, was signed late Wednesday by Chinese officials and Iraqi Oil Minister Hussain al-Shahristani.

The revised terms of the deal increase the anticipated output from the billion-barrel field to 110,000 barrels per day from the originally planned 90,000 barrels per day, the statement said. The contract is to run for 20 years after production begins three years from now, it said.

http://news.yahoo.com/s/ap/20080828/ap_on_bi_ge/china_iraq_oil

[54anickel]

28. Interesting...the gall of these Iraqis to sell OUR oil. Bit more from the article

snip>

If it is approved, the agreement would be the first Saddam-era oil deal to be honored by the new Iraqi government.

A number of companies say they signed deals with Saddam's regime and demand that those be honored, or the countries involved be given priority on new agreements.

But the Iraqi statement said that some technical services contracts with other big petroleum companies might be postponed.

Iraq's Oil Ministry has consistently denied giving any advantage to companies with which Saddam signed deals, instead insisting that oil and gas fields and exploration blocks will be offered up for bids.



That damned Saddam! No wonder we had to "take care" of him.

"Offered up for bids" - well, big oil has been reporting record profits - how much are they willing to shell out? :rofl:

Meanwhile, China has all those worth less dollars we exchanged for cheap shit at Wal-mart. Could get interesting......

[ozymandius]

6. Toyota lowers 2009 global sales target

TOKYO - Toyota lowered its global sales target for 2009 by 700,000 vehicles to 9.7 million Thursday, showing that even one of the world's most durable automakers is being hurt by rising material costs, a slowing U.S. market and soaring gas prices.

Toyota Motor Corp had previously set a 2009 global sales goal of 10.4 million vehicles.

The lower target would still be a 2 percent increase from the company's 2008 sales goal of 9.5 million. But even that figure was reduced last month from an initial 9.85 million units.

....

Watanabe said he saw as "fundamental" the slowdown in the U.S. market as soaring gas prices not only crimps car purchases but drives an unprecedented shift in consumer demand from trucks to smaller fuel-efficient models.

http://news.yahoo.com/s/ap/20080828/ap_on_bi_ge/japan_toyota

[ozymandius]

8. Tropical Storm Gustav Approaches Jamaica as Louisiana Prepares

Aug. 28 (Bloomberg) -- Tropical Storm Gustav approached Jamaica, gaining strength as residents of Louisiana began to prepare for the system to hit at hurricane force next week, three years after Katrina devastated New Orleans.

....

Gustav is projected to regain hurricane strength as it passes over the Caribbean near the Cayman Islands and between Jamaica and Cuba. The system is then forecast to head northwest, toward a Sept. 2 landfall as a hurricane in Louisiana.

http://www.bloomberg.com/apps/news?pid=20601086&sid=ahFxUDXLgfAQ&refer=latin_america

---

More info here at WeatherUnderground

[ozymandius]

9. Fannie's Mudd Changes Management to Boost Confidence (Update1)

Aug. 28 (Bloomberg) -- Fannie Mae Chief Executive Officer Daniel Mudd replaced three top deputies in an effort to restore investor confidence after record losses and a 90 percent drop in the shares.

Chief Financial Officer Stephen Swad, 47, hired less than two years ago to help the government-chartered company complete an accounting overhaul, will be replaced by Controller David Hisey, 48, Washington-based Fannie said in a statement yesterday. Peter Niculescu, 48, will take over from 52-year-old Chief Business Officer Robert Levin. The head of risk management, Enrico Dallavecchia, 46, will also leave.

Mudd is shaking up Fannie's management after $9.4 billion of losses the past four quarters eroded capital and sparked concern the company may not weather the worst housing slump since the Great Depression. The decline prompted U.S. Treasury Secretary Henry Paulson to forge a rescue package for the company and smaller competitor Freddie Mac.

http://www.bloomberg.com/apps/news?pid=20601103&sid=awvKeY2s7.OI&refer=us

[54anickel]

30. What? Are they wearing a Superman shirt under that suit - or maybe just one of these.....

[AnneD]

36. Well we no longer have....

"Truth, Justice, and the American Way", so I guess it's PR.

[Demeter]

38. Welcome to the New, Improved American Way!

We're not in Kansas any more, boys and girls, but it sure does look like the Robber Barons are here to stay.

[54anickel]

51. Mission Accomplished.....

[ozymandius]

10. U.S. Stock-Index Futures Drop; Wal-Mart, Fannie Mae Decline

Aug. 28 (Bloomberg) -- U.S. stock-index futures declined as oil advanced for a fourth day, dimming the earnings outlook for retailers.

Wal-Mart Stores Inc., the world's largest retailer, fell in Germany as crude traded near $119 a barrel. Fannie Mae, the biggest U.S. mortgage-finance company, retreated as a management shakeup failed to shore up investor confidence.

Futures on the Standard & Poor's 500 Index expiring in September lost 3.3, or 0.3 percent, to 1,278.8 at 10:13 a.m. in New York. Dow Jones Industrial Average futures declined 27 to 11,470. Nasdaq-100 Index futures dropped 6.25 to 1,895.5.

....

MBIA Inc., the largest bond insurer, rallied $1.01 to $12.99 in Germany after the company agreed to reinsure $184 billion in municipal bonds for Financial Guaranty Insurance Co., demonstrating its ability to win new business after losing its top AAA rating.

http://www.bloomberg.com/apps/news?pid=20601103&refer=us&sid=asce4qUzGdkE

[ozymandius]

11. Work harder, take home less

NEW YORK (CNNMoney.com) -- For most of the past decade, the economy grew much stronger - but middle-class Americans had little to show for it.

That's the conclusion of a trio of economists who on Thursday released a preview of their book The State of Working America in 2008/2009 due out next year.

Despite two periods of recession in the past decade, U.S. worker productivity still rose 18% in the 2000s - about 2.5% per year, according to author Jared Bernstein, a widely followed economist from the liberal-leaning Economic Policy Institute.

But inflation-adjusted income for the American middle-class family actually fell during the same period. The median real income for working-age middle-income families in the United States dropped $2,000 between 2000 and 2007, from about $58,500 to $56,500, the U.S. Census Bureau reported Tuesday.

http://money.cnn.com/2008/08/27/news/economy/state_of_working_america/index.htm?postversion=2008082805

[ozymandius]

12. Call It Wishful Thinking (from The Big Picture)

Today's guest post comes from Mark Thoma, who labors tirelessly in the pacific Northwest. Mark is a Professor of Economics at the University of Oregon, where he also pens the well regarded blog, Economist's View.

In the news today, I've been hearing once again that we are near the bottom of the housing cycle, the inevitable bottom call. For example, though the more optimistic analysts are a little more cautious than at times in the past, they still believe the end of the housing downturn may not be to far away:

Although U.S. home prices fell faster than ever in the second quarter, the rate of acceleration slowed in June... Experts hailed the slight deceleration as a harbinger of an eventual recovery in the dismal real estate market. ...bservers seized upon a sliver of good news: ... "I consider it good news that you're seeing price declines decelerate," said Terrin Griffiths, economist and industry analyst with the California and Nevada Credit Union League. "While the markets haven't reached bottom, we're getting closer to there."

and

Two announcements suggested that a bottom could be nearing for the housing market

But enough quotes, you already know how this goes.

...

Are we near the bottom? Is the end near? I wish I could answer yes, but I think we have a ways to go yet. Paul Krugman says:

When will it all end? The answer is, probably not until 2010 or later.

I'm hoping it won't be that long, but so far the crisis has unfolded in an almost eerily slow fashion - sort of like watching a train wreck in slow motion and being unable to do anything about it - and there's no reason to think that will change.

http://bigpicture.typepad.com/comments/2008/08/call-it-wishful.html

[TalkingDog]

34. How many bottoms?

Is anybody keeping track of how many times the bottom has been called for various recent economic trends?

We need a catchy slogan and a splashy web page with a counter....

Bottoms up or
Scraping Bottom
or.....

ideas? actual numbers?

[Demeter]

40. Twice a Week, By My Count, We Hit Bottom

which makes sense, if one is being dragged down a staircase by one's feet....

[AnneD]

56. Howz about this.....

Bottoms Up
Scraping Bottom
Black Bottom Dance (a flapper era pre depression jitter)

[ozymandius]

13. Citigroup Settles Charges of Widespread Theft of Customer Funds

We can imagine how a large company might rationalize the actions that led to these charges. Customers have positive credit balances on their cards for a variety of reasons. Why not just "sweep" the cash into your own bank account, and use it as part of your leveraged reserves? The customer does not really need the money, right? Especially if they are "poor or recently deceased." You are merely 'borrowing it' with no harm done. Right? Clever. We're the Master's of the Universe, the smartest boys in the room.

http://jessescrossroadscafe.blogspot.com/2008/08/citigroup-settles-charges-of-theft-of.html

---

Back story here:

Citigroup settles with California over credit card skimming

SAN FRANCISCO (MarketWatch) -- Citigroup Inc. settled charges that it stole from its customers using a computer program that skimmed positive credit card balances into the bank's general fund, according to the California Attorney General's office Tuesday. Under the settlement, Citigroup will return more than $14 million to customers with 10% interest, and pay California $3.5 million in damages and civil penalties.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7bB569FAF9-07FD-4B32-89E7-41E28AEA1102%7d&siteid=yhoof2#comments

[AnneD]

39. OMG!!!

:wow: :wtf:

[Demeter]

41. Instead of "Too Big to Fail", How About "Too Stupid to Live"

or "Too crooked to Avoid Indictment"?

[ozymandius]

14. Plunge Protection Team, Pakistan Style

Linked from Calculated Risk

From Bloomberg: Pakistan Sets Floor on Stock Prices to Stop Plunge

Pakistan set a floor for stock prices on the benchmark exchange, moving to halt a plunge that has wiped out $36.9 billion of market value since April.

Securities can trade within their daily limit of 5 percent ``but not below the floor-price level'' of yesterday's close ...

Ahhh ... stock prices that can only go up.

---

I see Bernanke drumming his fingers on the table, thinking... thinking... ummm.

[Tandalayo_Scheisskopf]

15. Overnight in the Kasino.

When 12" Texas Gag Rails of fine Peruvian Krell are horned up nostrils and the Grey Goose flows like water.

CLV08.NYM Crude Oil Oct 08 118.92 6:13am ET Up 0.77 (0.65%)
HOU08.NYM Heating Oil Sep 08 3.2807 6:12am ET Up 0.019 (0.58%)
NGV08.NYM Natural Gas Oct 08 8.688 6:10am ET Up 0.08 (0.93%)
PNU08.NYM Propane Gas Sep 08 1.70 5:40am ET 0.00 (0.00%)
RBU08.NYM RBOB Gasoline Sep 08 3.0775 5:42am ET Up 0.0103 (0.34%)

Oh, they are making big plans to reclaim their former glories on the back of Gustav. They have it all figured out. Big plans. Big plans.

One other thing: Considering CALPERS has a huge position in commodities and you can be sure that Arnie put his people in CALPERS, I bet a look at who they are, who they were/are connected with and what their trading history looks like would be most...intriguing. Especially when you consider Arnie's past history with Enron.

[UpInArms]

21. October crude up $1.52 to $119.67 a barrel on Globex

01. October crude up $1.52 to $119.67 a barrel on Globex
8:20 AM ET, Aug 28, 2008

[UpInArms]

17. dollar watch

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

Last trade 76.814 Change -0.223 (-0.29%)

An Upward Revision in US GDP Conflicts With Bearish EURUSD Technical

http://www.dailyfx.com/story/special_report/special_reports/An_Upward_Revision_in_US_1219906207681.html

Growth in the second quarter for the US economy is expected to have improved by 2.8%. An inline print would be significantly higher than the preliminary estimate of 1.9% and an improvement from the first quarter’s reading of 0.9%.



Fundamental Outlook

Growth in the second quarter for the US economy is expected to have improved by 2.8%. An inline print would be significantly higher than the preliminary estimate of 1.9% and an improvement from the first quarter’s reading of 0.9%. Any growth beyond the 1% stimulus contribution will ease recession fears and may spark bullish sentiment. The dollar has continued to benefit from the declining growth in other parts of the world as the U.S. looks to be the first to emerge to from the current global slowdown. The technical outlook is calling for a dollar correction with the EURUSD looking to head higher. The greenback may be over bought, as the economy still has to contend with a bottomless housing slump and deteriorating labor market. However, giving the recent drop in oil prices and improvement in durable goods orders, optimism will grow for future growth adding to dollar support.

...more...

Dollar Bulls Ask 'When Will The Fed Hike?'

http://www.dailyfx.com/story/special_report/special_reports/Dollar_Bulls_Ask__When_Will_1219866780446.html

The Fed minutes released this passed week confirmed what the market has been pricing in for some months now: the next move in interest rates is likely to come in the form of a rate hike. However, for dollar traders, the operative question is not whether the policy board will hike or cut, but rather when.



CREDIT MARKET: HOW IS IT DOING?

The Fed minutes released this passed week confirmed what the market has been pricing in for some months now: the next move in interest rates is likely to come in the form of a rate hike. However, for dollar traders, the operative question is not whether the policy board will hike or cut, but rather when. Fed Fund futures this week have maintained the steady decline in speculation for a hawkish move anytime time this year. The derivatives show the market is pricing in a 90 percent probability for the September 16th's meeting to pass without incidence and a more intense 78 percent likelihood that the benchmark will still be at 2.00 percent through year’s end. With the dollar pushing 8 month highs after staging the biggest rally in over three years, forecasts will need to find solid fundamentals to maintain such heights. However, with inflation cooling and financial problems growing, a hike seems distant.



U.S. CONSUMER: HOW ARE THEY DOING?

Economic data released over the past week related to the health of the American consumer seems to point to a brighter future. However, the promising headline figures may be just a glossy façade to ongoing economic troubles. Data this past week suggested a rise in existing and new home sales (improving the outlook wealth) as well as a rise in the consumer confidence gauge (boosting expectations for spending). However, we need to remember that the housing data is merely rebounding from 17-year lows and inventories are pushing record highs even though prices continue to tumble. For the sentiment gauge, the current conditions figures have pushed to new lows and the headline reading is just off of multi-decade lows. In the second half of 2008, the consumer is still expected to be a burden on GDP. We will look to the 2Q revisions to see if they are becoming a drag earlier than expected.



...more...

[UpInArms]

19. Negative real interest rates may frighten the Fed

http://www.marketwatch.com/news/story/negative-real-interest-rates-may/story.aspx?guid=1C489B5E-BF43-420B-9AD5-403DFD965B04&dist=SecMostRead

NEW YORK (MarketWatch) -- All Federal Reserve board members reportedly want to raise interest rates -- albeit not just yet.

Reason: behind the growth slowdown, real interest rates have turned dramatically negative.

Real interest rates are nominal interest rates less inflation. Negative real rates mean if you hold cash, and often all other financial assets as well, you're actually losing purchasing power.

Negative real rates are often interpreted as a loss of confidence in the economy -- and a sign that inflation is getting out of control.

This week's release of minutes from the Fed's Aug. 5 meeting suggested more worry about the economy than did the Fed's policy statement at the time. Read related story.

But the fact that all Fed members think the next interest rate move should be up, and that a vocal minority think monetary policy is already too loose, is at least as significant.

Real interest rates have plunged abruptly and dramatically, deeper into negative territory than they've been for many years.

...more...

[UpInArms]

20. Credit-Card Rage

http://news.yahoo.com/s/bw/20080827/bs_bw/aug2008db20080826832238;_ylt=AiI7Qfl.d_HigfuVPEV7HoKb.HQA

David Giantomasi says he vigilantly paid his credit-card bills each month. Even if he could only make the minimum payment, he made sure to get all his monthly payments squared away. So he was shocked when the interest rate on his Chase credit card suddenly jumped to 19.99% from 7.99%. When Giantomasi called the card issuer to demand an explanation, he was enraged. He was told that overall turmoil in the credit markets meant higher rates for a number of customers.

Chase won't comment on individual cardholder accounts. "I felt completely helpless," Giantomasi recalls. "These credit-card companies are beyond the law and should be more tightly regulated."

Giantomasi isn't alone in his desire to see the credit-card industry reined in. Lured by bank come-ons that sold a debt-fueled lifestyle of lavish vacations, sumptuous restaurant meals, and carefree shopping sprees, consumers piled up unprecedented debt during the credit boom: Consumer credit-card debt has skyrocketed to almost $1 trillion, double what it was in 1996. Unpaid credit-card debt is on the rise, too, up 22% in June from a year earlier, according to reports by the major credit-card issuers, American Express (NYSE:AXP - News), Bank of America (NYSE:BAC - News), Capital One Financial (NYSE:COF - News), JPMorgan Chase (NYSE:JPM - News), Citigroup (NYSE:C - News), and Discover (NYSE:DFS - News). But when the housing bubble popped and the economy slammed on its brakes, suddenly many free-spending consumers were left holding the bag.

Now those same cardholders are rushing in to support rule changes proposed by the Federal Reserve Board back in May, to limit unfair or deceptive credit-card practices.

New Rules on Rates

The proposed rules, which could be implemented as early as yearend, would represent the first time in over 20 years that a government agency has recommended banning certain credit-card industry practices. Regulation has been left largely to the card issuers, and the Fed and other banking regulators tended to stick to forcing card companies to disclose terms and conditions clearly to customers.

Under the proposed rules, though, banks would no longer be able to hike up interest rates on existing debt, as Giantomasi experienced. Card companies would have to split required monthly payments evenly between the high- and low-rate balances on a card. (Currently, card companies allocate payments to the lowest interest-rate balance first, which leaves a lot of cardholders unable to make a dent in balances at higher interest rates. That's a recipe for rapidly accruing interest and a feeling of helplessness about managing debt, say cardholders.) And consumers would get a longer grace period before they're slammed with penalty fees.

...more...

[Dr.Phool]

24. Don't you wish that you could change the terms of a contract on a whim?

I could call my mortgage company and tell them I'm tired of paying 6% on my house, and it would better suit me to pay 0.99%. I could cut my car payment in half!

Chase is slime. On second thought, all credit card companies are slime.

[PassingFair]

25. This just happened with my husband's AMEX card...

2 days late receiving the payment, and they upped the
interest rate to 29.97%!!!!

He was angry ALL DAY.

The waived the late fee, but wouldn't
lower the interest rate, so he has to
transfer the smallish ($1,000)balance
to another card.

The crackdown is LONG overdue!

[Dr.Phool]

29. Chase pulled the same shit on me a few years ago.

The rate went from prime to 29.97%. When I complained they offered to lower the rate to 27.5%. I transferred the balance also.

[AnneD]

43. About damn time they be regulated....

if you handle snakes prepare to be bitten.

As the sun set and she holds a shredded credit card in her fist. Shaking her fist anger ly she shouts
" As God is my witness, I will never use credit cards again."

que theme from "Gone with the Wind"

[DemReadingDU]

22. For all the foreign language experts

Edward Harrison has posted on his blog a round-up of articles in foreign languages

click here for the links...
http://www.creditwritedowns.com/2008/08/foreign-press-alert-28-aug-2008.html

[AnneD]

26. Morning Marketeers......

:donut::donut::donut::donut: I thought everyone needed some extra donuts and joe this morning. Between the Olympics last week, the DEM Convention and school starting in most places, most of us have been stretched thin and need a little kick start.
My daughter and I went out last night to dinner. We were celebrating my birthday a few days early-while she was still in town. We had a wonderful Italian dinner at an old 'traditional' style restaurant. We went to their sister restaurant (now closed) when she was a small child. It was a nice meal and a nice trip down memory lane.

And just when I thought I couldn't eat another bite, I come home, watch the DNC and get a juicy serving of red meat.:9 It feels so good to be voting FOR something and not selecting the lessor of 2 evils. I really like our ticket this year and I hope we make the case for it.

I was listening to an interview with Rudi Gui lani. I really liked Steve Inskeeps interview. He asked the simple follow up questions that has become a lost art in the MSM any more. When Rudi made a claim, Steve challenged him. The press has been brain washed by the usual GOP huff and bluff that such questioning means 1) you are accusing them of being a liar and 2)the person asking the question is being rude. Well excuse me for being a turd in the punch bowl, but I want some answers and I want the truth. I was laughing at the interview and I had respect for Rudi's good nature in taking the questions (even if he couldn't give a good answer to my satisfaction).

http://www.npr.org/templates/story/story.php?storyId=94057373


Happy hunting and watch out for the bears.

[Dr.Phool]

31. The important question is.....

Did you have any tiramisu for your birthday?

Happy Birthday!
:party: :toast: :party: :toast: :party:

[AnneD]

33. No...

but we shared a slice of 'Sin Pie'. Can't go wrong with chocolate and mint, but what they did with it WAS a sin.

[antigop]

35. Yippee! Score one for the unions! Boeing gives up on effort to eliminate pension plan

http://www.marketwatch.com/news/story/boeing-gives-up-effort-eliminate/story.aspx?guid={3286DD48-A8CF-4FF0-B3BB-097EB17E0C60}&dist=msr_1

Boeing Co. has reportedly withdrawn an offer to begin replacing its traditional pension plan with an employer-sponsored plan, such as a 401(k), after its machinist union threatened to strike.
According to a Wall Street Journal article late Tuesday, the Chicago-based aircraft manufacturer has instead offered to lift its monthly pension payments by 11.4% and give its machinists raises totaling 9%.
Over the weekend, leaders of the International Association of Machinists and Aerospace Workers warned that the company's first offer would almost certainly result in a strike. The union's last walkout, in 2005, left 18,000 machinists off the production lines for four weeks.

Marvelous, simply marvelous.

antigop
---a firm advocate of defined benefit pension plans --- the OLD kind, not the cash balance pension crap

[Dr.Phool]

42. Good for them.

It really is good to have a union stand up to these corporate thieves. A 401k can be a nice supplement to a defined benefit plan, but it can't replace it.

[antigop]

37. WSJ: SEC moves to pull plug on U.S. accounting standards

http://online.wsj.com/article/SB121985665095476825.html?mod=hpp_us_whats_news

The Securities and Exchange Commission signaled the demise of U.S. accounting standards, kicking off a process Wednesday that could ultimately require all publicly listed American companies to follow an international model instead.

Introduced in two steps, the shift could eventually cut costs for companies and smooth cross-border investing. At the same time, investors worry it will create confusion, especially during the transition. Other critics worry that the international system offers too much wiggle room for companies, compared with the more precise rules enshrined in U.S. standards.

Well, those CEOs just gotta make their bonus, don't they?

[amandabeech]

59. This moves in the exact opposite direction of Sarbanes Oxley,

the purpose of which was to make financial statements and disclosure much more transparent. My guess is that it will be gone when the international accounting standards come in.

If the international standards are based on broad principles rather than detailed rules, as the article states, and will be subject to interpretations from several securities administrators and accounting boards in different countries.

In the hands of the usual suspects here in the U.S., I can only imagine the flights of fancy that will pass for financial statements and the management's discussion of them contained in annual reports and proxy statements.

Buyer beware. The U.S. markets are about to turn into even more like the casinos that they often resemble.

[ozymandius]

60. Precisely the point.

The goal is to remove the culminated regulations that grew as a reaction to generations of high finance pillaging. Rules are only as effective as they are faithfully interpreted and vigorously enforced.

[amandabeech]

63. Absolutely true. n/t

[antigop]

64. But this way, they can work the accounting in their favor -- VOILA! executive bonuses! n/t

[Dr.Phool]

44. Halle Building owner can insist on rent in gold.

By LISA CORNWELL
Associated Press Writer

CINCINNATI -- A landlord can enforce a clause in 1912 lease requiring that rent be paid in gold coin for a landmark building in Cleveland, a federal appeals court ruled Wednesday.

A three-judge panel of the 6th U.S. Circuit Court of Appeals in Cincinnati sent the case back to a U.S. District Court in Cleveland to determine the equivalent rent that S&R Playhouse Realty Co. would owe for the Halle building with the "gold clause" enforced. The lower court also must address any remaining defenses by S&R.

The building is owned by 216 Jamaica Avenue LLC, which filed a breach-of-contract lawsuit in 2006 against S&R demanding rent equivalent to the value of 35,000 1912 gold coins. S&R has paid $35,000 annually in U.S. currency since assuming the lease in 1982 and balked at paying what would be a much higher amount. The lower court, finding for S&R, refused to enforce the gold clause.

"We are delighted that the windfall that the tenants have been enjoying is going to be eliminated and this will get back to a market-based rent," said David Thompson, an attorney with the Washington, D.C-based law firm Cooper & Kirk representing 216 Jamaica Avenue. "S&R has been paying 17 cents a square foot, which is way below prevailing market rates."

(snip)more at

http://blog.cleveland.com/pdextra/2008/08/halle_building_owner_can_requi.html

The Halle Building sits in downtown Cleveland, and was where the Santa scenes in "A Christmas Story" was filmed.

[Demeter]

45. Forget Kansas, What's the Matter With Ohio?

It took them 97 years to decide they were getting screwed over and find a way out?

[AnneD]

53. Pay them in those coins....

that the Noe was involved with ....:rofl:

[TalkingDog]

57. Bwahahahaha! I guess that's good news for my alma mater:

Ohio University. In the beginning they accepted labor and crops in exchange for tuition. I think the bales of hemp exchange referenced in early documents might compete with an exchange for gold.

[TalkingDog]

58. Here we are:

A resolution of May 16, 1809, provided that payments to the university might be made in hemp at $6.00 per cwt.: steers three years old and not over eight at $2.50 per cwt. the hide and tallow to be included; barrows and spayed sows weighing alive not less than 250 pounds at $3.00 per cwt.

The rules of Princeton were adopted temporarily as the rules for Ohio University, but in March, 1812, the trustees adopted the following: No student shall possess or exhibit any indecent picture; nor purchase, nor read in the University any lacivious impious or irreligious book or ballad, nor sing or repeat verses of like character; and if any student shall be convicted thereof or of lying, profaneness, drunkenness, theft, un-cleanliness, playing at unlawful games or other gross immoralities, he shall be punished according to the nature and heinousness of the offense by ad-
monition public reprehension, or expulsion from the University: If any student shall quarrel with, insult or abuse a fellow student or any person whatever he shall be punished according to the nature of his fault. No student shall keep by him, nor bring nor cause to be brought into the University, on any occasion any spiritous or fermented liquors without the expressed permission of the President. No student shall go to a Tavern, Alehouse, Beerhouse, or any place of like kind for the purpose of entertainment or amusement without special permission from some one of the faculty; nor shall he, on any occasion, keep company with a person whose character is notoriously bad under penalty of admonition, and if the practice be continued of expulsion. It is required of the students to treat all persons whatsoever with modesty, civility and due respect; but more especially, to exhibit at all times the most respectful deportment to the officers of the University, and if any student shall wistfully disobey any officer of the University, or shall either in speech or action manifest disrespect towards the President, he shall be admonished and make due acknowledgement to the offended party, or be suspended, as the Faculty may decide.

If any student shall refuse to appear personally before the President or any other officier of the University when required to do he shall be punished for contempt of authority: and the most prompt and implicit obedience shall be yielded by each student to the lawful commands of the
President of the Institution.

.....

No hallowing, whistling, jumping nor any other boisterous or tumultuous noise shall be permitted in any of the apartments of the University, under such penalty as the nature of the offense may require.
No student shall disguise himself by wearing women's apparel, or in any other way whatever under such penalty as the President and any two trustees may see cause to inflict.


from: http://publications.ohiohistory.org/ohstemplate.cfm?action=toc&vol=50

[Demeter]

65. Sounds Like a Real Party School---NOT

I spent a year at Whoopie Tech (it didn't live up to the name, of course I was married and pregnant at the time....)

[DemReadingDU]

46. Chris Whalen: FDIC needs a backstop of half a trillion dollars

8/27/08
The Federal Deposit Insurance Corp.'s (FDIC) list of troubled banks has increased by 30 percent this quarter, and this jump is causing the FDIC and the banking community to prepare for tomorrow’s problems today.

The FDIC may have to borrow money from the Treasury Department to handle an expected wave of bank failures coming down the road, according to the Wall Street Journal.

It would not be surprising if this were to occur, according to Chris Whalen, managing director of Institutional Risk Analytics. In an interview with CNBC, Whalen said the FDIC needs a backstop. (To listen to the full interview, watch the video.)

"They need about a half a trillion dollars in borrowing authority, and they need a vehicle to own these banks while we triage them and sell them."

Whalen added that he expects big bank failures might be on the way.

more...
http://www.cnbc.com/id/26421989

[Dr.Phool]

47. Another half a trillion borrowed dollars.

This country is circling down the drain in it's final flush.

[DemReadingDU]

49. How Much Will Government Bailouts Actually Cost the American Taxpayer?

8/11/08
How Much Will Government Bailouts Actually Cost the American Taxpayer?

Over the last eight years, we have watched in horror as a two-term Republican Administration furthered programs that have effectively thrown lit sticks of dynamite into our American factories. These programs have dismantled entire industries in the United States and encouraged their growth in China and elsewhere in Asia because of cheap labor. Also, during this time the illusion of prosperity was maintained by a Greenspan Fed as interest rates were cut to record lows, and a disastrous housing bubble was created. Americans were so seduced by home ownership that they bought houses in a frenzy that they couldn’t afford, and then borrowed against them. In addition, under the Administration’s policies, the value of the dollar has been trashed, and commodity inflation has robbed workers lucky enough to still have jobs.

As the unprecedented credit crisis continues into its second year, it’s becoming crystal clear that the American economy is slipping into the worst post-WWII recession on record. It’s even beginning to dawn on third and fourth generation Wall Street Republicans that if the average American doesn't have a good job (much less any job), they won’t be able to pay their mortgage, auto loan or credit card.

For now, Fannie Mae and Freddie Mac have been essentially nationalized and the Federal Reserve has been turned into a dumping ground for toxic waste mortgage securities beginning with the Bear Stearns bailout.

What is this economic disaster going to cost the taxpayer? Let's try to add it up.

Estimated Bailout (In Billions of Dollars)
The Federal Reserve - 10
Student Loans - 20
PBGC - 30
FHA - 20
SBA - 20
FHLB - 50
FDIC - 150
Fannie & Freddie - 300
Total - 600

click to read associated text...
http://www.sfgroup.org/How%20Much%20will%20Government%20Bailouts.htm


I think these figures are going to have to be adjusted upwards.
:(

[54anickel]

52. The author has a rather strange take on "socialism" - n/t

[CatholicEdHead]

48. How many days in Iraq is a half trillion dollars?

[DemReadingDU]

50. Each month costs us at least $12 billion

We've probably already reached half trillion dollars for this needless war.
Our country is so screwed.

[Tandalayo_Scheisskopf]

55. The Center Cannot Hold

CLV08.NYM Crude Oil Oct 08 115.63 3:30pm ET Down 2.52 (2.13%)
HOU08.NYM Heating Oil Sep 08 3.1859 3:25pm ET Down 0.0758 (2.32%)
NGV08.NYM Natural Gas Oct 08 8.127 3:30pm ET Down 0.481 (5.59%)
PNU08.NYM Propane Gas Sep 08 1.70 3:21pm ET 0.00 (0.00%)
RBU08.NYM RBOB Gasoline Sep 08 3.02 3:22pm ET Down 0.0472 (1.54%)

It's interesting how the crazed mofos have moved to the overnight trading. Used to be they held sway during the day. That said, it seems that the overnight runups have lost their lustre. Maybe these guys are starting to learn that all this hurricane market goosing is not what it is cracked up to be.

[ozymandius]

61. end of the day numbers and dyspeptic blather

Dow 11,715.18 Up 212.67 (1.85%)
Nasdaq 2,411.64 Up 29.18 (1.22%)
S&P 500 1,300.68 Up 19.02 (1.48%)
10-Yr Bond 3.795% Up 0.023
NYSE Volume 3,895,345,750
Nasdaq Volume 1,634,173,875

4:20 pm : Thursday marked another low volume session for stocks, but the lack of buying conviction didn't stop the major indices from trending more than 1% higher to finish near session highs. The advance was prompted by encouraging economic data, retreating oil prices, and leadership from the financial sector.

Trading volume on the NYSE failed to break one billion shares for the ninth straight session. Volume typically exceeds the one billion shares mark with relative ease. The lack of trading suggests there may be little conviction behind the stock market's recent moves. Nonetheless, the session's advance remains pleasing to bullish investors.

Stocks took off early following the announcement of second quarter GDP data. Growth was revised upward to 3.3% from a previously reported 1.9%. Exports and personal consumption played a key role and suggested the economy is faring far better than many headlines suggest. Additionally, trends in the data suggest third quarter GDP will expand at a similar rate.

Initial jobless claims for the week ending Aug. 23 fell 10,000 to 425,000. Meanwhile, the four-week moving average retreated to 440,250 from 446,250. The numbers reflect soft labor conditions and indicate a modest decline for August nonfarm payrolls is likely.

Crude futures climbed as much as 2% early on, moving higher on fear that Hurricane Gustav will disrupt Gulf production. As those fears subsided and a larger-than-expected build in natural gas inventories was announced oil dropped as much as 3.4%. It closed more than 2% lower, near $115.55.

Crude's retreat pushed the energy sector into the red. It finished 0.8% lower and was the only sector in the S&P 500 unable to post a gain.

Softer oil prices helped consumer discretionary stocks. Specifically, retailers fared well. Although, their performance is also attributable to a batch of better-than-expected earnings per share results from group members Genesco (GCO 35.58, +2.59), Coldwater Creek (CWTR 7.49, +0.55), Men's Wearhouse (MW 21.61, +1.60), Tiffany & Co. (TIF 43.85, +4.24), and Zale Corp. (ZLC 27.92, +4.77). The session's prevailing sense of optimism helped participants look past mixed outlooks from several of the retailers. Even Sears Holdings (SHLD 90.62, +3.64) climbed higher, despite missing the consensus earnings per share estimate.

The financial sector was the primary beneficiary of the session's buying efforts. It closed 4.5% higher. Providing the most influence were diversified financial service companies, which finished with a 5.4% gain.

Fannie Mae (FNM 7.95, +1.47) and Freddie Mac (FRE 5.28, +0.53) were a couple of the highest fliers, though. Fannie announced last evening it is shaking-up its management team to control credit losses, conserve capital, and provide liquidity to the mortgage market. Thrifts and mortgage lenders closed with a 10.9% advance.

Of the major indices, the Dow posted the largest advance. Its only component to finish lower was Coca-Cola (KO 53.12, -0.67), which was downgraded at Credit Suisse to Neutral from Outperform.

Week-to-date, the Dow is up 0.7%, the S&P 500 is up 0.6%, but the Nasdaq is down 0.2%.DJ30 +212.67 NASDAQ +29.18 NQ100 +0.8% R2K +2.0% SP400 +1.6% SP500 +19.02 NASDAQ Adv/Vol/Dec 2078/1.63 bln/753 NYSE Adv/Vol/Dec 2485/956 mln/646

[Robbien]

62. Some funny adjustments buried in the rosy July new home sales number

http://www.marketwatch.com/News/Story/sales-new-homes-rise-look/story.aspx?guid=%7B514CE59D%2DBF69%2D4FD7%2DB628%2D8282092827B6%7D

The article states July sales touted as an increase over June of 2.4%, everyone partied.

July sales were 515,000; June's number was 503,000. However not mentioned is that June's original number was 530,000.

They say the numbers were adjusted downward because:

The original figures likely overstate the level of sales, because they count canceled sales contracts, which have jumped in the past year.

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

Sales of homes used to be a number they didn't play around with very much. Appears that's not the case anymore.

[Demeter]

66. No Number Is Sacred!