STOCK MARKET WATCH, Monday November 2

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday November 2, 2009

Bush Administration Officials Convicted = 1
Name(s): David Safavian

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

Financial Sector Officials Convicted = 6

AT THE CLOSING BELL ON October 30, 2009

Dow... 9,712.73 -249.85 (-2.57%)
Nasdaq... 2,045.11 -52.44 (-2.50%)
S&P 500... 1,036.19 -29.92 (-2.81%)
Gold future... 1,040 -6.70 (-0.64%)
10-Yr Bond... 3.38 -0.12 (-3.29%)
30-Year Bond 4.23 -0.11 (-2.47%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie, Silver and US$

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

Read more: du

[ozymandius]

1. Market Observation

Running Government Interference
BY BRIAN PRETTI

A few very quick comments about recent trends in payroll employment that just don’t seem to be getting enough attention as of late, especially given the clear change we are seeing over the last six months or so. You may remember that probably close to a year ago I penned a discussion focusing on the rhythm of government employment looking back many decades. The important point of that discussion was that the rhythm of government employment lags that of the private sector in each economic cycle. In other words, private sector employment turns down long before government employment begins to weaken in each cycle. Wildly enough, government employment trends tend to weaken late in recession cycles and continue soft well after official recessions conclude. Not too hard to understand in that it’s during the midst of economic contractions that income tax, property tax, retail sales tax, etc. revenues derived by all government entities decline meaningfully, as has exactly happened again in the current cycle, but this time with a vengeance.

It’s when this occurs that government entities at all levels begin to tighten their belts and employment is negatively affected. Well guess what? Although it seems there has been virtually zero commentary about this, since May of this year just as the “green shoots” crowd began crowing about payroll employment getting less bad, almost right on cue government employment trends began to break down. In nominal body count terms, aggregate government payrolls (Federal, state, and local combined) peaked in April and have declined by over 200,000 through September. In the five-month period ended September, 213,000 government jobs have been lost, the bulk of which come at the State and Local government levels. Here’s a fun stat for you to amaze and dazzle your friends at the next cocktail party. Since 1969 there have only been two other five months periods in which government employment has shed as many jobs as has occurred in the past five months – September of 1980 and October of 2000. To suggest this is not a common occurrence is an understatement. The following chart documents the nominal body count and year over year rate of change history of government employment in aggregate. As the chart shows us, the current year over year rate of contraction has no equal until we reach back to 1982.

-see chart-

Funny, I have not personally seen this emerging trend in government employment weakness talked about anywhere. This is something to keep in mind as we move ahead, because it is now when the government sector in aggregate could become the next drag on overall payroll employment. You know that my wonderful home state of California squeaked by passing a so-called budget some month’s back. The budget was a band-aid. It simply kicked the can of hard decisions down the road into 2010. Bigger budget cuts are to come by necessity. And they will virtually certainly involve explicit payroll reductions next year. There is little other alternative. What California has done so far is to declare “holidays” a number of times per month for many State employees. Effectively they have already cut payroll in concept, but it has not shown up in official payroll numbers as these folks are still employed; they just work less hours each month and collect less pay. California is not alone in this poster child example of what is occurring in many states across the country. So, is it fair to say that for many States and municipalities, payroll headcount is currently overstated given that hours worked and nominal dollar payrolls have been cut? Seems more than fair, no? But given the rhythm of historical experience in government employment set against economic cycles, it is exactly now that we need to expect and anticipate the government sector becoming a drag on overall payroll headcount over the remainder of this year and into next. Be prepared as history tells us this is exactly what is coming.

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

[ozymandius]

2. Today's Reports

10:00 Construction Spending Sep
Briefing.com -0.5%
Consensus -0.2%
Prior 0.8%

10:00 ISM Index Oct
Briefing.com 54.0
Consensus 53.0
Prior 52.6

10:00 Pending Home Sales Sep
Briefing.com 1.2%
Consensus -0.1%
Prior 6.4%

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

[Roland99]

45. Factory sector strengthens in Oct. (ISM to 55.7)

Factory sector strengthens in Oct.
http://www.marketwatch.com/story/factory-sector-surges-in-october-ism-says-2009-11-02

The nation's manufacturing firms grew at the fastest pace in more than three years in October, according to a closely followed survey of top executives released Monday.

The Institute for Supply Management index rose to 55.7% from 52.6% in September, well above the 53.0% expected by economists surveyed by MarketWatch. See Economic Calendar.

It's the highest reading since April 2006. The production gauge also rose to a three-year high.

...

ISM officials said that manufacturers have stopped slashing inventories.

So, instead of cutting production to lower inventory, they're back to near-regular production? In the hopes of what? Exporting more product with the dollar tanking? Readying for the holiday season?

I'm not holding my breath that this means more jobs will come about.

[ozymandius]

3. Oil hovers near $77 ahead of US economic reports

SINGAPORE – Oil prices hovered near $77 a barrel Monday in Asia after a big fall the previous trading session as investors eyed upcoming figures on the U.S. economy and a volatile dollar.

.....
Investors will be looking to a slew of economic indicators this week for further clues about the strength of the U.S. economic recovery. The Labor Department's October employment report will likely be the most closely watched report, but data on manufacturing, services and home sales could also move markets.

The Federal Reserve will also comment after a two-day meeting on interest rate policy.

.....
Investors will also be paying attention to third quarter corporate earnings results this week. Ford Motor Co., Cisco Systems Inc., Kraft Foods Inc., Marathon Oil Corp., Starbucks Corp. and Time Warner Inc. are scheduled to report.

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

[ozymandius]

4. Global stocks slide ahead of policy meetings

LONDON (Reuters) – World stocks added to the previous week's losses on Monday, hugging one-month lows as investors pulled back from a more than seven month rally and prepared for the eventual withdrawal of stimulative monetary policy.

.....
Investors were bracing for a week of meetings at major central banks, including the U.S. Federal Reserve and European Central Bank, the release of minutes from the past meetings of others and a G20 finance ministers' meeting.

.....
News that CIT Group INC, a U.S. lender to hundreds of thousands of small and medium-sized businesses, finally filed for bankruptcy on Sunday, also underscored the continuing fragility of parts of the financial sector.

World stocks as measured by MSCI were down 0.3 percent, adding to last week's more than 4 percent loss, the largest since early March just before the rally began. Emerging market stocks lost 0.6 percent.

http://news.yahoo.com/s/nm/20091102/bs_nm/us_markets_global_1

[ozymandius]

5. Retail faces uncertainty as CIT enters bankruptcy

WASHINGTON – The bankruptcy of a key lender that helps retailers stock their shelves is adding to the industry's worries ahead of the critical holiday shopping season.

CIT Group Inc. filed for Chapter 11 bankruptcy protection Sunday in New York after months of struggling to avoid collapse. The company provides badly needed credit to thousands of small and mid-sized businesses, and is a critical part of the flow of capital in the retail sector.

CIT stressed that its lending operations will continue to operate as it proceeds through bankruptcy with the hope of shedding $10 billion in debt. Chairman and CEO Jeffrey M. Peek said the company's prepackaged reorganization plan "will allow CIT to continue to provide funding to our small business and middle market customers, two sectors that remain vitally important to the U.S. economy."

.....
CIT is an important source of capital, working with 2,000 vendors that supply merchandise to more than 300,000 stores. About 60 percent of the apparel industry depends on CIT for financing.

http://news.yahoo.com/s/ap/20091102/ap_on_bi_ge/us_cit_group_bankruptcy

[Hugin]

7. Lemme get this straight...

An insolvent lender will continue lending while insolvent?

Woo boy! Now, there's a workable plan... :crazy:

Looks as if, TSTF = Too Stupid To Fail, is the new TBTF. :eyes:

We are well through the looking-glass, kids.


PSA: Please, keep your arms and legs inside the handbasket at all times.

[ozymandius]

10. They are just writing the notes.

Goldman Sachs and Morgan Stanley hold the paper. Funny, isn't it, how any calamity provides a benefit to Goldman Sachs?

[Hugin]

11. Seriously?

You wouldn't be pulling my leg or anything? }(

Looks, as if during my absence things have truly become unhinged...

(BTW, if anyone has any vibes to spare... Please, send them my way. :/ )

[ozymandius]

13. Seriously.

Sorry. I was mistaken to say that Morgan Stanley would benefit from the deal. Goldman Sachs, however... - ozy

CIT Approaches Bankruptcy After Striking Icahn, Goldman Accords

Nov. 1 (Bloomberg) -- CIT Group Inc., the 101-year-old commercial lender seeking to avoid collapse, may file for a prepackaged bankruptcy as soon as today after striking deals with billionaire Carl Icahn and Goldman Sachs Group Inc.

A prepackaged bankruptcy “is probably going to go through,” Icahn said Oct. 30. He will supply a $1 billion loan for “supplemental liquidity” that can be used as bankruptcy financing, the New York-based company said. CIT also said it reached an agreement with Goldman Sachs to keep a credit line open should the lender file for court protection.

The accords were disclosed the day after a deadline passed for CIT to solicit votes in support of either a $30 billion out- of-court debt exchange or a prepackaged bankruptcy. CIT is seeking to reduce debt by at least $5.7 billion after being locked out of credit markets it relies on for funding and posting nine quarters of losses totaling more than $5 billion.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aCSEbhLRqHrc&pos=6

[Demeter]

17. If I Have Any Vibes, They Are Now Yours

(Not sure even an earthquake could shake anything loose for me today...)

[Hugin]

19. ...

Thanks. :)

[Dr.Phool]

26. How about some puppy kisses?

Just watch out for rhe little needle teeth.

[ozymandius]

28. You offering us an antidote du jour, Dr. Phool?

Thanks! Now, where are some pics?

:hi:

[Dr.Phool]

39. Here's a pic

Sara, Queen of the Loveseat.

She went to the dog park for the first time this morning. She loved it.

[Demeter]

44. What a sweetheart!

How big do you expect her to get?

[Dr.Phool]

50. About the size of a regular American Lab.

Maybe slightly smaller. Her mother was a Springer. Daddy was a Chocolate Lab.

[DemReadingDU]

58. She's adorable

:)

[Tansy_Gold]

68. Looks like you got picked by a good one, Doc!

Stopped at the feed store this morning. Next to the check-out they had a display of calendars. Lab calendars and chihuahua calendars and beagle calendars and Aussie shepherd calendars. And right in front was the Blue Heeler calendar. Much as I love the four critters I have here now, I still miss the heeler I had for 13 years until August '04. They're all special, but once in a while there's one that's extra special.


Tansy Gold, who tries to be extra special, too

[Roland99]

41. So, I guess this 20-year accord from last yr between CIT and GS is already re-worked?

http://www.bloomberg.com/apps/news?pid=20601087&sid=aK2S6NscGM24&dbk

[ozymandius]

6. Fed's Path to Higher Interest Rates Begins to Take Shape

An economic recovery seems to have begun, and Federal Reserve officials are thinking mostly these days about how to unwind the unprecedented stimulus they've pumped into the economy. Eventually that will mean raising interest rates.

What will a Fed tightening cycle look like? When will it begin? Fed officials don't have answers to either question yet, and investors would be wrong to think they do. But the contours of what a rate-boost cycle could look like are beginning to come into focus as the Fed's next policy meeting approaches Tuesday and Wednesday.

Three points emerge: First, an internal debate on tightening policy and how to communicate that to the market is only just beginning, and most officials don't believe the economy is near healthy enough yet to move toward tightening. Second, don't count on a tightening cycle to look like the last one. And third, the behavior of financial markets could take on added importance this time.

.....
One obvious indicator is the unemployment rate, at 9.8% in September. Because it is so high -- which implies that inflation is going to stay very low -- officials aren't inclined to be in a big rush with this process. Another indicator is inflation expectations, which remain contained and give the Fed room to stay easy. A third is core inflation, which has slowed since last year but might need to slow further to justify such low interest rates.

http://online.wsj.com/article/SB125711582994221579.html

[Hugin]

9. There's more of that supply-side tying of unemployment/wage-stagnation to low inflation fiction.

I will be happy to see that malarkey end. The Ayn Randians are still writing articles. :blech:

[Roland99]

37. And still controlling policy, too.

[Tansy_Gold]

42. Rant ahead -- and I'll put it in my journal -- but I am really confused

Maybe I've gone off on this subject before, but I guess it bears repeating. Not for the SMWers, but for the lurkers, who maybe post in some of those "other threads." And if I'm crazy or stupid or ignorant, well, I can always append an Emily Latella "Never mind."

Is there something about the fundamentals of economics -- and by that I mean economics of any political persuasion -- that is simply lost on the majority of human beings? Or have I been operating on a flawed premise all this time?

It seems to me that economies, all economies, start with three basics:

1. Agriculture and other food production (including fishing, hunting, raising crops, gathering berries, whatever)
2. Mining and other resource extraction (including timber cutting)
3. Manufacturing of all objects not found naturally.

The first is essential to human existence at any economic level, even paleolithic.

The second is essential to progressing beyond #1 to #3 and the creation of transferable wealth.

All of these require the addition of human labor in order to make them useful to the human creature. Homo sapiens sapiens has to pick the berries or grab the fish outta the water in order to eat. That's labor. The addition of labor makes the resource usable.

There is no value to anything without the addition of labor.

It's labor that picks up the stone and takes it back to the cave and shapes it into a clovis point. It's labor that pick up a long straight stick and takes it back to the cave.
It's labor that fashions the string from animal sinew and uses it to attach the clovis point to the stick and make it into a spear.
It's labor that uses the spear to bring down the mammoth.

Okay, have I got it right that far?

We're talkin' about an economy at the most basic level. No money, no loans, no prime vs. Alt-A mortgages. Human subsistence. If you got questions or wanta throw in a "Yeah, but what if...?" you can just shut up 'cause you can't interrupt my rant while I'm the one at the keyboard. ;-)

So the point is that something lying on the ground or in the ground or growing on a bush or hopping down the bunny trail represents potential usefulness but it only becomes useful through the application of human labor. On the ground or on the tree it's nothing, until the application of human labor makes it something.

As our species progresses, using its talents and skills to turn resources into useful things, it develops other products besides food and the tools to acquire food. All of those products are produced with human labor. Whether it is hollowing out a log to make a canoe to go further out on the lake and spear bigger fish. Whether it is fashioning needles out of deer antler and thread out of deer guts to sew together deer skins into warm clothing that allows comfortable movement. The production of these objects constitutes the creation of "wealth." Useful items that can be accumulated are "wealth." The clan with a good canoe that can go out in the lake with four spearfishers and bring back a mess o' fish every day without sinking is a "wealthier" clan than the one otherwise equally equipped that has no canoe.

These are possessions. They have value insofar as they are of use to the humans who own them.

Our species develops further. One group of folks makes really great canoes. Their spearfishers always bring home more fish in a single day because their canoes are more stable and leak less, allowing them to stay out on the lake longer. The problem is that they don't do so good at making spear points. They have to take an extra spearfisher on every fishing trip because too many of their throws don't spear a fish. So they bring home more fish in their better canoes, but it actually takes MORE labor than if they had good spearpoints. Let's call this clan the Boatwrights.

Their rivals on the lake can only stay out on the water half as long. Their canoes are wobbly and they ship water easily with the slightest waves. But these folks make superb spears. They know where there's a deposit of large obsidian nodules from which they make razor sharp spear points. And they've perfected a technique for making perfectly balanced spear hafts to which to attach those points. So even though they don't bring back as many fish in day's outing as the Boatwrights, the Spearmaker clan only spends one quarter of their day on the lake. They can actually go out every single morning, bring home the day's catch before noon, and spend the rest of their day making new spear points.

The Boatwrights, on the other hand, come back late in the afternoon, exhausted. They've got a two- or three-days' supply of fish, a good portion of which will rot before it gets eaten. And they can't go out again tomorrow because they're just worn out from throwing their spears with dull points.

Well, those of you with any imagination at all will probably figure out tht the Spearmakers and the Boatwrights are going to get together and EXCHANGE THEIR LABOR. Now, with better boats AND better spears, they can bring home tons of fish every day.

In fact, they'll have way more fish than they need or can even consume. They have SURPLUS GOODS. So what ends up is that the Boatwrights build boats, and the Spearmakers make spears, and the best of each group become the Fishers who go out each day and bring back some fish to eat and some to trade with the tribe in the inland forest, the Hunters, who have perfected a nice little snare for rabbits and therefore have more dead bunnies than they can use.

So now we've got a nice little economy going on here. Boats, spears, fish, snares, rabbits -- all acquired with LABOR. It's LABOR that produces everything. One group doesn't "buy" the boat -- they "buy" the labor that turned the fallen tree trunk into the boat, and they "pay" for it with fish caught with human labor. The neolithic housewife doesn't "buy" the freshly killed deer; she buys the hunter's labor in stalking and killing it.

Nothing happens without labor.

Advancing a few generations, we now have a rudimentary civilization. Our Boatwrights and Spearmakers, Fishers and Hunters, Skinners and Potters, Farmers and Shepherds have built a little town with little huts. They have some petty crime and occasional raids from a distant tribe. They need some watchers, people who will stroll through the village and keep their eyes open for trouble, whether it's kids maliciously pulling down thatch just before a big storm or those raiders from across the river. The problem is that the watchers will have to have places to live and food to eat, so how can they take time away from those necessary activities in order to patrol the village?

This can only happen if the other villagers produce enough surplus to "pay" the Constables for their services. And since no one knows ahead of time which villager will actually need the Constables' service EVERYONE chips into the common fund. And so taxation -- and socialism -- are born.

Let's move up a few more generations. In addition to the Boatwright's canoe business and the Spearmaker's weaponry shop, the village now has a pottery factory, a cart factory, a tannery. They're so good at what they do that every family has a private cart, a set of every day pots and "good" pots, all kinds of wealth. In fact they have so much that they're trading their products around the whole region. They're "buying" sparkly stones from the Miners up in the mountains and fancy furs from some Minskies that come into town once in a while from parts unknown. They're even able to pay priests to do nothing but pray all day. Whether the priests actually get results from these prayers is questionable, since everything is supposed to happen after death -- those 72 virgins and all that -- and no one has provided any proof, but anyway it happens. The villagers have a lot of surplus LABOR stored up in their possessions.

Eventually of course they establish a medium for their trading, and money is born. This makes it easier to exchange the goods they make with their labor and to pay for those who don't produce any actual products, like the hairdresser and the musicians at the daughter's wedding.

About that wedding. See she was planning to get married next fall, after the harvest was brought in, but she and the guy got to bundling up one winter night and you know what happens, so to save the family's reputation, the wedding got moved up to spring. And now the dad has to go to the musicians and says, "Hey, fellas, I woulda had the money in October but we gotta have this wedding in April, so can I like pay you half now and the other half in October?" And they talk it over for a while and tell him, "Yeah, sure, but it's gonna cost you more." Rather than lose face by having the wedding after the baby comes or, worse, having a wedding without musicians, Dad agrees to pay more. And voila! Credit was born.

Credit is essentially the buying of Time. Time does not make things. Only Labor makes things.

Whether it's the individual family, the village, or a whole 21st century nation, debt is the purchase of Time, and the only way to pay off the debt is with Labor.

If you have two families or two villages who trade only in services -- whether it's protection from thieves or teaching the children -- there can be no creation of wealth for exchange. Wealth comes only from the production of goods beyond the needs of the producer, and then those goods can be exchanged for other goods or for services. At some point in any economy more complex than simple individual existence, the essential three activities have to be engaged in and be healthy. Any complex economy that doesn't provide its own food, procure its own raw materials, and manufacture
its own products cannot survive.

Time is not a viable commodity. Time, in the form of credit, can facilitate 1 or 2 or 3, but it cannot take the place of any of them. And when the extension of credit, or the sale of Time, exceeds the ability of Labor to repay the debt, then the economy collapses. It may be an individual's maxed out credit cards, or it may be an entire nation that has such a voracious appetite for the things other nationn' economies make or for useless commodities like War and Faith that it cannot pay for them.

And when the sellers of Time, those who have tried to alter reality so that the villagers believe Time is a real thing and a necessary Thing to their existence, more important in fact than the very real goods and services that they need to remain alive, then the economy begins to collapse. People begin to sell more and more of their Labor -- which is ultimately the only source of Wealth -- for less and less of value. Like the Boatwrights in their marvelous canoes that could go out on the lake all day and never sink or turn over, these people are working harder but getting less in return. If it used to take five fish to buy a bucket of berries, it now costs 12 fish.

Why did the price of berries suddenly go so high?

Well, there's a clan of folks who weren't any good at canoe building or spear sharpening so they went off to live on some scrubby swampy land loaded with mosquitoes and prickly bushes. All they had going for them was the berries on those bushes. They tasted good, but no one wanted to get down in there with the mosquitoes and the prickers on the bushes. The Berry clan, however, found out that they could pick a few extra berries, take 'em down to the village and sell 'em for lots of "cash." And then they found out that they could pay people a little bit of that cash to pick berries for them. So they'd sell a bucket of berries for five fish, pay someone two fish to pick 'em, spend another fish on the bucket, and pocket two fish for profit! Such A Deal!

And capitalism was born. The Berries didn't do any work. They added nothing in Labor to the production of the fruit they were selling. They owned the land and they hired the Harvesters and they kept the profits.

And the next year it was six fish a bucket. And the Harvesters bought out the family who made the village's leather. The Tanners retired and the Harvesters brought in some immigrants to run the tannery, but the Newcomers didn't control the price of the product or the quality. The Harvester paid them way less than the Tanners had made, but the Harvesters were able to lower the price and still took the profit. Adn they used that profit to buy out the tannery in the next village and hte next. The people in the villages had nowhere else to buy their leather, and they knew the new stuff wasn't nearly as good quality as when they were buying from the people who actually owned and ran the business with their own LABOR, but hey, the prices were cheap and what could you do?

Next thing you know, the price of berries is eight fish a bucket. The Berrys are getting richer all the time, but they are producing nothing. And the priests who make all the after-death promises are saying the Berrys are perfectly right in what they do, so all the people who live in misery as a result of the Berrys are told to shut the fuck up!

The Berrys and all of their ilk eventually create the whole banking and "insurance" industries, all of which create no wealth; they simply facilitate the transfer of it, sometimes for good, sometimes for not so good.

What too many of us have not realized -- or not been taught -- is that without productive LABOR, the kind that produces the transferable wealth, there can be no economy. Banks are not an economy. Insurance companies are not an economy. Stock markets are not an economy. Labor is. Labor that produces useful goods and services (such as health care and teaching that facilitate labor to produce physical goods) is the foundation of any and all Economies.

We need the Boatwrights and the Spearmakers. We need the Carters and the Fishers and the Farmers and the Miners and the Tanners and the Shoemakers.

Until more of our people understand this, we won't be able to turn this catastrophe around. And sadly, there are a whole bunch of people on DU even who don't get it.

Or else the one person who REALLY doesn't get it is




Tansy Gold

[kickysnana]

43. +1

[Demeter]

46. You Got It, Tansy, But You Left Out TWO Endeavors

There are the Artists, who break up the monotony of life by recording it, and the Storytellers, who guide the group.

It is the STORYTELLERS who have really fallen down on the job--some are incompetent, some are ignorant, some are infantile and self-indulgent, and some are pure evil, and they and their Patrons have scared the shit out of the competent storytellers with threats and acts of violence and hate.

The Artists will be making a full record of the decline and fall, however. If any are still alive.

[Tansy_Gold]

67. Having practiced BOTH art and storytelling professionally in my life

I left those out intentionally, because it's a whole other social theory. (Terry Eagleton's "The Ideology of the Aesthetic," etc.). And while they contribute to the social fabric, they exist (imho) in a kind of parallel economy. Not necessary to existence, but necessary to humanity. Or, as one of my professors put it, civilizations don't create art; art creates civilizations.

The point of course is that economies can function without art, without bankers, without insurance, indeed without money. What they can't function without is labor. Without labor, resources have no value. When we lose sight of these basics and use the formulae and the numbers and the jargon to mask the fundamental reality, we're well on our way to extinction.

Reality. . . . . . is.


Thanks, all. You made my day!

:yourock:


TG

[nc4bo]

53. You've put it all into a nutshell. It's so easy to understand. Actually is always was

unless of course you're an ostrich.

Wish I could recommend your post a thousand times.

[Roland99]

55. Pure gold, Tansy. Pure gold!

[DemReadingDU]

59. You got it,

Good rant
:)

[tosh]

60. Nicely told, Tansy.

:toast:

[Dr.Phool]

61. I dare you to post that excellent rant in GD.

You'll be opening up the gates of Hell.

Excellent post.

[Tansy_Gold]

66. I may do that, Doc. If it opens a few eyes, it''d be worth it

:evilgrin:



Puppy kisses put out the flames anyway!

[Tansy_Gold]

72. I posted it, with a few tiny corrections and clarifications

Asbestos suit on, and now I'm going back to the paying gig.

[bread_and_roses]

78. just got a chance to finish the thread - another + from me, Tansy

I'll have to see if I can muster up the energy to go on over to GD and find your thread to R it there.

[mullard12ax7]

64. Abraham Lincoln quote on labor about 150 years ago

"We all declare for liberty; but in using the same word we do not all mean the same thing. With some the word liberty may mean for each man to do as he pleases with himself, and the product of his labor; while with others, the same word may mean for some men to do as they please with other men, and the product of other men's labor. Here are two, not only different, but incompatible things, called by the same name - liberty. And it follows that each of the things is, by the respective parties, called by two different and incompatible names - liberty and tyranny." -- A. Lincoln

[Karenina]

74. BWHAHAHAHAHAHAHAHAHAHAHA!!!

:spray: :rofl::rofl::rofl:

Tansy Gold, once again so eloquently

STATING THE OBVIOUS.

(Girlfriend, would you also happen to be a Max fan?)

[Tansy_Gold]

75. Max who? n/t

[Karenina]

76. Keiser.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x396616

:spray: :rofl::rofl::rofl:

Sometimes a girl just has to roll on the floor laughing her ass off.

[Tansy_Gold]

77. I can honestly say that until your post

I had never in my life heard of Max Keiser.


Will have to watch the video when I'm done with "real work."


TG

[ozymandius]

8. Japan’s Bonds Gain Most in a Month as CIT Failure Boosts Demand

Nov. 2 (Bloomberg) -- Japan’s government bonds advanced by the most in a month on speculation investors sought the relative safety of debt after CIT Group Inc. filed for bankruptcy.

Benchmark 10-year yields fell from near an 11-week high as the Nikkei 225 Stock Average slid the most in four weeks. CIT, the 101-year-old commercial lender, listed $71 billion in assets and $64.9 billion in debt in a Chapter 11 filing in the U.S. Bankruptcy Court for the Southern District of New York.

.....
The yield on the 1.3 percent bond due September 2019 fell three basis points, the most since Oct. 2, to 1.375 percent at 4:23 p.m. in Tokyo at Japan Bond Trading Co., the nation’s largest interdealer debt broker. The price rose 0.259 yen to 99.348. Yields touched 1.425 percent on Oct. 30, the highest since Aug. 12. A basis point is 0.01 percentage point.

Ten-year bond futures for December delivery advanced 0.28 to 138.27 as of the afternoon close at the Tokyo Stock Exchange.

The Nikkei 225 dropped 2.3 percent today, the biggest slump since Oct. 2. Benchmark 10-year yields had a correlation of 0.6 with the Nikkei 225 so far this quarter, according to Bloomberg data. A value of 1 means the two moved in lock step.

http://www.bloomberg.com/apps/news?pid=20601101&sid=a3vHR1CrJEa0

[ozymandius]

12. Secret Bond Deal Led IRS to Middleman Financing in the Dark

Here is a local story for me that comes as no surprise. Atlanta's way of doing bidness follows a time honored tradition of shady, under the table dealings. Our former mayor, Bill Campbell, cannot show his face in the city because of situations like this. Either the city government worked incompetently and dishonestly or Atlanta's government associated with Rubin's ilk. - ozymandius

Nov. 2 (Bloomberg) -- At the end of a March 6, 2000, conference call with the financial adviser David Rubin, city of Atlanta officials disqualified the winning bid for a $453.3 million investment-management contract.

The decision shaved $58,000 off what Atlanta taxpayers would have earned from the $13.5 million high bid and awarded the account to runner-up Bank of America Corp., according to a copy of city documents obtained under the Georgia Records Act.

Only after the Internal Revenue Service investigated five years later did local officials learn that Rubin’s firm, CDR Financial Products Inc., had entered into a secret side agreement with the Charlotte, North Carolina-based bank. CDR’s share would be worth as much as $340,000, based on city and federal records.

“IRS believes that CDR, Bank of America and possibly others may have colluded to fix pricing,” an unidentified Atlanta employee wrote in an undated internal memorandum after city authorities met with IRS investigators in September 2005.

Rubin, two co-workers and CDR were charged on Oct. 29 in a nine-count indictment that alleges conspiracy, wire fraud and obstructing federal tax authorities. The indictment in U.S. District Court in the Southern District of New York, which doesn’t cite the Atlanta transaction or any others by name, accuses Rubin and CDR of conducting sham auctions and reaping kickbacks from 1998 to 2006.

http://www.bloomberg.com/apps/news?pid=20601109&sid=auHFr7xQK9lg

[Demeter]

14. The Health Care Bill Dies? Matt Taibbi

http://trueslant.com/matttaibbi/2009/07/28/the-health-care-bill-dies/


...The reason a real health-care bill is not going to get passed is simple: because nobody in Washington really wants it. There is insufficient political will to get it done. It doesn’t matter that it’s an urgent national calamity, that it is plainly obvious to anyone with an IQ over 8 that our system could not possibly be worse and needs to be fixed very soon, and that, moreover, the only people opposing a real reform bill are a pitifully small number of executives in the insurance industry who stand to lose the chance for a fifth summer house if this thing passes.

It won’t get done, because that’s not the way our government works. Our government doesn’t exist to protect voters from interests, it exists to protect interests from voters. The situation we have here is an angry and desperate population that at long last has voted in a majority that it believes should be able to pass a health care bill. It expects something to be done. The task of the lawmakers on the Hill, at least as they see things, is to create the appearance of having done something. And that’s what they’re doing. Personally, I think they’re doing a lousy job even of that. I lauded Roddick for playing out the string with heart, and giving a good show. But these Democrats aren’t even pretending to give a shit, not really. I mean, they’re not even willing to give up their vacations.

This whole business, it was a litmus test for whether or not we even have a functioning government. Here we had a political majority in congress and a popular president armed with oodles of political capital and backed by the overwhelming sentiment of perhaps 150 million Americans, and this government could not bring itself to offend ten thousand insurance men in order to pass a bill that addresses an urgent emergency. What’s left? Third-party politics?


POSTED ON JULY 28, AND NO LESS TRUE TODAY

[nc4bo]

15. Patience. Patience grasshoppers. Gosh, it hasn't even been a full year yet.

:mad: :puke: and :eyes: (in no particular order).

[pokercat999]

23. lol third party politics lol wtf are u sick or stupid the only

fucking answer left..... armed insurection..this govt must be removed at any cost and replaced by a govt of the people,by the people and FOR the people....oh....never mind, sorry

[Festivito]

16. Debt: 10/29/2009 11,868,457,477,911.94 (DOWN 25,211,403,177.07) (Thu)(41B,Surplus FY'10)

(The Obama surplus for our current fiscal year, Obama's first all Obama fiscal year, continues. Today, Monday afternoon we'll know if it will last a whole month. Good day to all.)

= Held by the Public + Intragovernmental(FICA)
= 7,456,680,623,919.04 + 4,411,776,853,992.90
DOWN 19,769,093,363.09 + DOWN 5,442,309,813.98

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 308-Million person America.
If every American, man, woman and child puts in $3.25 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.75, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 10 seconds we net gain another American, so at the end of the workday of the report, there should be 307,838,301 people in America.
http://www.census.gov/population/www/popclockus.html ON 09/27/2009 07:13 -> 307,558,299
Currently, each of these Americans owe $38,554.19.
A family of three owes $115,662.58. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 days.
The average for the last 22 reports is 4,197,483,147.99.
The average for the last 30 days would be 3,078,154,308.53.

There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 21 reports in 29 days of FY2010 averaging -1.97B$ per report, -1.43B$/day.
Above line should be okay

PROJECTION:
There are 1,179 days remaining in this Obama 1st term.
By that time the debt could be between 10.2 and 18.0T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
10/29/2009 11,868,457,477,911.94 BHO (UP 1,241,580,428,998.86 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 -0,041,371,525,599.80 -------BHO
The Obama Surplus shows above this line.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
10/08/2009 -027,497,592,311.52 -
10/09/2009 -000,014,303,257.45 ----
10/13/2009 +010,339,703,734.17 ------------********** Tue
10/14/2009 +000,250,135,805.15 ------------********
10/15/2009 +040,455,301,335.22 ------------**********
10/16/2009 -000,034,671,440.79 ----
10/19/2009 +000,169,101,777.19 ------------******** Mon
10/20/2009 +000,084,506,561.85 ------------*******
10/21/2009 +000,260,615,642.06 ------------********
10/22/2009 -054,881,746,021.15 -
10/23/2009 -000,105,634,856.79 ---
10/26/2009 -000,680,933,964.04 --- Mon
10/27/2009 +000,626,474,250.98 ------------********
10/28/2009 +000,798,039,832.64 ------------********
10/29/2009 -019,769,093,363.09 -

-50,000,096,275.57 Total of 15 above reports.

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

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4125479&mesg_id=4125481

[Festivito]

73. Debt: 10/30/2009 11,893,091,028,361.01 (UP 24,633,550,449.07) (Fri)(1 month in surplus.)

(There is an Obama surplus for the first month of the first quarter, the first month of our current fiscal year, the first month in Obama's first all Obama fiscal year -- although we are still dealing with the mess Republicans left behind. Good day to all.)

= Held by the Public + Intragovernmental(FICA)
= 7,487,886,930,552.47 + 4,405,204,097,808.54
UP 31,206,306,633.43 + DOWN 6,572,756,184.36

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 308-Million person America.
If every American, man, woman and child puts in $3.25 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.75, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 10 seconds we net gain another American, so at the end of the workday of the report, there should be 307,846,941 people in America.
http://www.census.gov/population/www/popclockus.html ON 09/27/2009 07:13 -> 307,558,299
Currently, each of these Americans owe $38,633.13.
A family of three owes $115,899.39. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 days.
The average for the last 22 reports is -760,817,052.30.
The average for the last 30 days would be -557,932,505.02.

There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 22 reports in 30 days of FY2010 averaging -0.76B$ per report, -0.56B$/day.
Above line should be okay

PROJECTION:
There are 1,178 days remaining in this Obama 1st term.
By that time the debt could be between 11.2 and 18.0T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
10/30/2009 11,893,091,028,361.01 BHO (UP 1,266,213,979,447.93 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 -0,016,737,975,150.70 ----------BHO
The Obama Surplus shows above this line.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
10/09/2009 -000,014,303,257.45 ----
10/13/2009 +010,339,703,734.17 ------------********** Tue
10/14/2009 +000,250,135,805.15 ------------********
10/15/2009 +040,455,301,335.22 ------------**********
10/16/2009 -000,034,671,440.79 ----
10/19/2009 +000,169,101,777.19 ------------******** Mon
10/20/2009 +000,084,506,561.85 ------------*******
10/21/2009 +000,260,615,642.06 ------------********
10/22/2009 -054,881,746,021.15 -
10/23/2009 -000,105,634,856.79 ---
10/26/2009 -000,680,933,964.04 --- Mon
10/27/2009 +000,626,474,250.98 ------------********
10/28/2009 +000,798,039,832.64 ------------********
10/29/2009 -019,769,093,363.09 -
10/30/2009 +031,206,306,633.43 ------------**********

8,703,802,669.38 Total of 15 above reports.

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

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4128759&mesg_id=4128789

[ozymandius]

18. (That old saw again.) Geithner Urges Banks to Resume Lending, Help Recovery

Geithner sounds shrill and feeble as he squawks once more for banks to start using the bailout money in some fashion that would lend credibility to his policies. - ozy

Nov. 1 (Bloomberg) -- U.S. Treasury Secretary Timothy Geithner said the country’s economic recovery and job creation hinge on banks taking more risk and restoring the flow of credit to businesses.

“The big risk we face now is that banks are going to overcorrect and not take enough risk,” Geithner said in an interview today on NBC’s “Meet the Press” program. “We need them to take a chance again on the American economy. That’s going to be important to recovery.”

Geithner judged the banking system to be “dramatically more stable” than it’s been in more than a year. U.S. banks have been reluctant to lend as the economy emerges from a recession and unemployment approaches 10 percent.

Loans by the biggest banks receiving the most government assistance from the $700 billion Troubled Asset Relief Program fell by 17 percent in August to $234.7 billion, the third time in six months that lending declined.

http://www.bloomberg.com/apps/news?pid=20601068&sid=aBG6IqPjtD1k

---

Jeebus! This man is woefully naïve. Again - I ask: Why the bloody hell is the man Secretary of the Treasury?

[Demeter]

20. Because Warren Harding Is Dead?

[ozymandius]

24. oops - I put "problem banks" story in the wrong place.

But Warren Harding? Really, he must have been Bush's inspiration: a do-nothing photo-op prop.

[MattSh]

22. Well, of course he's naive.

How the hell do you think he rose to such a lofty position? Competence?

:sarcasm: . . . . . . <-- I know, generally not needed on SMW.

[Tansy_Gold]

31. Banks should take more risk????? Is he fucking nuts???????

No, he's just part of the sucking machine that's relieving all working people of all their worldly goods, all their hope, all their dignity and returning them to the level of pre-industrial serfdom.

How difficult is it to understand that when you keep giving more and more and more and more to the already wealthy, you will end up with a few very very very very very very rich people (aristos) and lots and lots and lots and lots and lots and lots of very very very very very very angry and desperate and "If I die I'm gonna take a dozen of those greedy bastards with me" peasants/peons/sansculottes/bolsheviks.

The problem (?) is that the serfs still have too much comfort. Even if they are comforts purchased on credit, we still have 'em. We aren't watching our children routinely die of starvation or easily treated minor infections or previously eradicated childhood diseases. Some of our institutions are approaching third-world quality, but as a nation we haven't quite reached the level of, say, Somalia or Zimbabwe. We're workin' on it, though, and Geithner is part of the machine that's taking us there.

He is, in his own way, every bit as evil in this administration as cheeeeeney was in the previous one.



Tansy Gold

[Roland99]

38. Haven't they been jawing for banks to open the spigots for some time now?

Banks are holding onto their cash so they can appear to be capitalized (while buying up cheap-assets in the meantime)

[AnneD]

56. What is it Lassie......

Little Timmy has fallen down the well. What is it Lassie-you helped push him down the well.....Good Lassie, let me give you a treat. That a good girl.:evilgrin:

[Demeter]

21. U.S. bank chargeoff rate exceeds Depression: Moody's

http://www.reuters.com/article/email/idUSTRE59P3LM20091026

The rate of loan charge-offs by major U.S. banks has exceeded those seen in the early years of the Great Depression as the credit crisis continues to take a toll, Moody's Investors Service said on Monday.

Bank charge-offs -- loans written off as uncollectable -- have reached $116 billion year to date, or 2.9 percent of outstanding loans on an annualized basis, Moody's said in a report. By comparison, bank charge-offs were about 2.25 percent in 1932, the third year of the Great Depression, Moody's said.

Charge-offs climbed to $45 billion in the third quarter from $40 billion in the second quarter and $31 billion in the first, Moody's said.

On an annualized basis, charge-offs were about 3.4 percent of outstanding loans in the third quarter, matching the Great Depression peak in 1934, Moody's said.

The charge-off totals cover banks rated by Moody's with more than $50 billion in assets. Moody's-rated banks hold 85 percent of the total assets in the U.S. banking system.

Bad loans resulting from the global credit crisis have battered banks' profits and triggered an upsurge in the number of troubled and failed banks. Banks that took major write-downs on residential mortgages during the housing slump are now suffering losses from commercial real estate and business loans as well.

The high costs of credit problems weighed heavily on banks' third-quarter results, Moody's said.

"For most banks, third-quarter earnings were at best modest, and in many cases they recorded sizable losses," Moody's said.

Since more credit costs loom, "we believe earnings prospects for the fourth quarter of 2009 and for 2010 are bleak for many U.S. banks," Moody's said.

The charge-offs have already been incorporated into Moody's bank ratings, however, and will not trigger more rating actions, Moody's said.

[ozymandius]

30. I do not trust those "bad news already factored-in" statements.

We see this all the time as an excuse to ignore what should be front-and-center in our field of awareness.

[Demeter]

25. NYC Aids Homeless With One-Way Tickets Home

http://www.nytimes.com/2009/07/29/nyregion/29oneway.html?_r=1&hp


They are flown to Paris ($6,332), Orlando ($858.40), Johannesburg ($2,550.70), or most frequently, San Juan ($484.20).

They are not executives on business trips or couples on honeymoons. Rather, all are families who have ended up homeless, and all the plane tickets are courtesy of the city of New York (one-way).

The Bloomberg administration, which has struggled with a seemingly intractable problem of homelessness for years, has paid for more than 550 families to leave the city since 2007, as a way of keeping them out of the expensive shelter system, which costs $36,000 a year per family. All it takes is for a relative elsewhere to agree to take the family in...

[ozymandius]

27. Unofficial Problem Bank List Grows to 500

From Calculated Risk:

Note: This was before the FDIC seized banks related to FBOP today (Friday, 10/30).

This is an unofficial list of Problem Banks.

Changes and comments from surferdude808:

The Unofficial Problem Bank List crossed a major threshold this week as 500 institutions are now listed.

The list grew by a net 18 institutions this week and nearly $44 billion in assets were added. Most of the increase comes is a result of the FDIC finally releasing its actions for September 2009. It will take another month to get their actions for October 2009.

The FDIC released 25 cease & desist order and 2 Prompt Corrective Actions. The list already included 8 of these 25 as they were identified through 8-K filings, media reports, or the State Banking Department of Illinois’ website.

From last week’s list, we dropped the 6 failures last Friday and another one that had failed back in July. Also, the FDIC issued a Cease & Desist Order on September 28, 2009 against Hillcrest Bank Florida that failed last Friday; hence, it never had time to appear on the list.

Most notable among the new additions are R-G Premier Bank of Puerto Rico ($6.5 billion); Central Pacific Bank, Honolulu, HI ($5.5 billion); and West Coast Bank, Lake Oswego, OR ($2.6 billion). The other 22 institutions added had an average asset size of $262 million.

Looking at the additions from a geographic perspective, there were four institutions headquartered in Washington, and two each in Florida, Georgia, Minnesota, and Wisconsin. There is a new addition from the FDIC issuing a Prompt Corrective Action Order on September 18th against Washita State Bank, Burns Flat, OK. Although not new to the list as they have been operating under a formal action, there were two other Prompt Corrective actions added. First, the OTS issued a PCA order on October 22nd against Century Bank, a Federal Savings Bank, Sarasota, FL; and the Federal Reserve issued a PCA order on October 27th against SolutionsBank, Overland Park, KS.

The list is compiled from regulator press releases or from public news sources (see Enforcement Action Type link for source). The FDIC data is released monthly with a delay, and the Fed and OTC data is more timely. The OCC data is a little lagged.

---

Even though this is an "unofficial" list, you can bet that the FDIC devotes sharp attention to these banks. - ozy

[Demeter]

29. CFTC: Speculators caused 2008 oil price crisis By Daniel Tencer

http://rawstory.com/08/news/2009/07/28/cftc-speculators-caused-2008-oil-price-crisis/

In a major U-turn from its claims during the Bush administration, the Commodity Futures Trading Commission is now set to admit that speculation in oil markets — and not the forces of supply and demand — are behind last year’s massive oil price spike. (JUly, 2009)

In the summer of 2008, oil prices on the open market reached an unprecedented $147 per barrel. Many economists argue the spike helped push the US into an economic free-fall last autumn.

At the time, the CFTC — which is tasked with regulating commodity and financial futures — said that the huge price spike was a result of supply and demand. That explanation was met with ridicule from many market-watchers, who said it was impossible that demand for oil increased by such a huge margin even as the North American, European and Japanese economies were slowing down.

Now, according to a scoop in the Wall Street Journal, the CFTC is about to reverse its Bush-era position, and admit that market speculators — investors who bought oil futures on the expectation they would rise in value — “played a significant role” in the oil spike.

Bart Chilton, a CFTC commissioner, told the WSJ that the original assessment was based on “flawed data.” He told the newspaper that the CFTC’s report, which will be released next month, will acknowledge the role of speculators in oil markets.

The CFTC’s admission highlights the often dangerous role that Wall Street speculators play in Main Street’s economic health. Many policymakers are now beginning to wake up to the reality that speculation in commodities markets can cause massive damage to the pocketbooks of ordinary citizens.

The Columbia Journalism Review reminds readers that, in his Rolling Stone article “The Great American Bubble Machine,” Matt Taibbi describes how major Wall Street players gamed the oil market:

With the public reluctant to put money in anything that felt like a paper investment, the Street quietly moved the casino to the physical-commodities market — stuff you could touch: corn, coffee, cocoa, wheat and, above all, energy commodities, especially oil.

Oil futures in particular skyrocketed, as the price of a single barrel went from around $60 in the middle of 2007 to a high of $147 in the summer of 2008…

But it was all a lie. While the global supply of oil will eventually dry up, the short term flow has actually been increasing. In the six months before prices spiked, according to the U.S. Energy Information Administration, the world oil supply rose from 85.24 million barrels a day to 85.72 million. Over the same period, world oil demand dropped from 86.82 million barrels a day to 86.07 million. Not only was the short term supply of oil rising, the demand for it was falling — which, in classic economic terms, should have brought prices at the pump down…

So what caused the huge spike in oil prices? Take a wild guess.

The CJR writes: “Note that Taibbi’s hardly the first person to say that the money from the housing bubble moved to form the commodities bubble, which remember, not only sent gas prices skyrocketing but helped cause dangerous food disruptions around the world.”

The CFTC’s turnaround comes after many other major oil-market regulators already came to similar conclusions. Last month,(June, 2009) the European Union and OPEC agreed at a meeting that regulation of oil markets would be necessary to prevent future oil bubbles.

“The 2008 bubble could be repeated if adequate regulatory reforms, including greater transparency, (are) not made as part of an overall reshaping of the global financial sector,” Reuters quoted EU officials as saying in a statement.

The CFTC now seems to agree with this view, but the WSJ points out that there is no consensus on this issue. Wall Street speculators may fight hard to keep their ability to profit off of commodity bubbles — potentially setting the stage for an international political showdown over financial market regulation.

“These decision makers don’t present a united front,” the WSJ reported. “The U.K.’s Financial Services Authority has found no evidence that speculators are behind big oil-price swings, people familiar with the matter said.”

[Demeter]

32. Good Morning Marketeers!

We had a scary Weekend thread and there's several really significant articles if you haven't been there yet. Thanks esp. to the contributers, who dug up some very rotten corpses for our viewing.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x492481

Maybe I'm getting jaded, but the combination of $2.5b in small bank failures and CIT's bankruptcy ought to cause more of a sensation...

[DemReadingDU]

33. How Goldman secretly bet on the U.S. housing crash

1st in the series
11/1/09 How Goldman secretly bet on the U.S. housing crash

In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.

Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.

Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws.

more, and a video
This is an article in a series
http://www.mcclatchydc.com/227/story/77791.html


Edit: ABOUT THIS SERIES
A five-month McClatchy investigation reveals how Wall Street colossus Goldman Sachs peddled billions of dollars in shaky securities tied to subprime mortgages on unsuspecting pension funds, insurance companies and other investors when it concluded that the housing bubble would burst.

* Sunday: High-yield promises, secret contrary bets
* Monday: Take borrowers to court, then take their homes
* Tuesday: Big losses, little recourse for overseas investors
* Wednesday: Blue-chip prestige flirts with subprime disaster

more...
http://www.mcclatchydc.com/goldman

[DemReadingDU]

34. 2nd in the series: Goldman takes on new role: taking away people's homes

11/2/09 Goldman takes on new role: taking away people's homes

When California wildfires ruined their jewelry business, Tony Becker and his wife fell months behind on their mortgage payments and experienced firsthand the perils of subprime mortgages.

The couple wound up in a desperate, six-year fight to keep their modest, 1,500-square-foot San Jose home, a struggle that pushed them into bankruptcy.

The lender with whom they sparred, however, wasn't the one that had written their loans. It was an obscure subsidiary of Wall Street colossus Goldman Sachs Group.

Goldman spent years buying hundreds of thousands of subprime mortgages, many of them from some of the more unsavory lenders in the business, and packaging them into high-yield bonds. Now that the bottom has fallen out of that market, Goldman finds itself in a different role: as the big banker that takes homes away from folks such as the Beckers.

lots more, and a video too...
http://www.mcclatchydc.com/100/story/77841.html


edit
COMING TUESDAY

Goldman Sachs and other Wall Street firms turned to secret Cayman Islands deals to draw overseas investors, including European banks and other foreign financial institutions, to invest hundreds of billions of dollars in securities tied to risky U.S. home loans. Unlike U.S. investors that lost money on the securities, however, these overseas institutions have fewer legal options.

[UpInArms]

36. it's going to take more than holy water, silver bullets and a wooden

stake to kill the GS beast.

[UpInArms]

35. dollar watch

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

Last trade 76.152 Change -0.203 (-0.26%)

Oil Gains on Chinese PMI, Metals Diverge Ahead of US ISM Data

http://www.dailyfx.com/forex/fundamental/forecast/daily/2009-11-02-1222-Oil_Gains_on_Chinese_PMI_.html

Crude oil and gold advanced after Chinese Manufacturing PMI offered a broad boost to most commodities, but silver remain confined to a familiar range. October's ISM figures line up as the catalyst to watch ahead.

Commodities – Energy
Crude Sees Support From Chinese PMI Data, US ISM On Tap Ahead

Crude Oil (WTI)       $78.02        +$1.02       +1.32%

Oil found support above 76.82 once again after HSBC released Chinese PMI figures showing the manufacturing sector continued to expand in October, offering a broad boost to commodities. Near-term resistance is seen at the familiar $78.17 level, with a push higher to target another push towards the psychologically significant $80 handle. October’s ISM Manufacturing survey and September’s Pending Home Sales figures as US data are likely to prove the most significant drivers of price action as US data continues to be primary pacesetter for investors’ perception of the global recovery, guiding market-wide appetite for risk.



Commodities – Metals
Silver Left to Consolidate as Gold Advances; Bulls Look to ISM for Catalyst

Gold       $1052.95       +$7.52       +0.72%

As with oil, gold prices got a boost from China’s October PMI release, pushing higher after a re-test of broken falling trend line resistance to surpass the $1050 level. Prices are now testing the upper boundary of a near-term rising channel and showing an Inverted Hammer candlestick, hinting that a move lower may be in the cards. The US ISM survey is the fundamental catalyst with greatest market-moving potential, with expectations calling for the highest reading in over 3 years. If this proves to force a bullish break higher, the path beyond current resistance is largely clear for a challenge of the triple top below $1068.

Silver       $16.56       +$0.25       +1.56%

Silver has lagged behind its more expensive counterpart with prices continuing to consolidate in a narrow range between $16.11 and $16.75. Positive divergence on the momentum studies may hint at a push higher, however, with traders looking to the US ISM report to set the trajectory of directional momentum.



...more...

US Dollar Forecast Remains Bullish Ahead of Critical Economic Data

http://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2009-10-30-2312-US_Dollar_Forecast_Remains_Bullish.html

The US Dollar finally showed signs of life through the past week of trading, setting a substantial low against the Euro and other key forex counterparts. An early-week tumble in the US S&P 500 and other financial risk sentiment barometers provided the spark for the dollar turnaround. Given extremely one-sided Dollar-bearish sentiment, it was little surprise to see the previously downtrodden currency continue mostly higher through Friday’s close. We have long argued that the Greenback was likely to establish a substantial low on overstretched market positioning. Of course, it is never profitable to be early on calls for major counter-trend moves. Yet the substantive week-long turnaround gives us reason to believe that the US Dollar has set a major low and will likely continue higher through end-of-year trading.

A substantial week of economic event risk promises no shortage of excitement in the days ahead. Forex options market volatility expectations are now at their highest since early July ahead of highly-anticipated central bank decisions and the infamous US Nonfarm Payrolls report. Recent US Third Quarter Gross Domestic Product figures suggest that the world’s largest economy is in much better shape than previously believed, and consensus forecasts are calling for relatively steady improvements across key economic indicators. Yet bullish expectations leave substantial room for disappointment, and the recent spike in the S&P 500 Volatility Index (VIX) suggests traders will dump risky assets at the first sign of trouble.

Early-week ISM Manufacturing and Pending Home Sales could spark further volatility across key asset classes, but the true fireworks will likely wait until the mid-week’s ISM Non-Manufacturing and US Federal Open Market Committee Rate Decision results. Traders are likely to pay especially close attention to the ISM Non-Manufacturing Employment Index ahead of Friday’s Nonfarm Payrolls result. The sub-index has seen fairly steady improvements after setting record-lows through 2008, but the below-50 reading shows that employment will likely continue to contract through the near future. Surprises in either direction will likely set the tone for the afternoon’s FOMC decision, while Friday’s NFPs will wrap up the week of substantive economic event risk.

Global financial markets are expecting big price moves in the week ahead, and traders should be careful of substantial day-to-day volatility across US Dollar pairs. We have made no secret of our calls for further US Dollar strength, but prices never move in a straight line. Suffice it to say, we expect our convictions will be put to the test in what promises to be an exciting week of forex market price action.



...more...

[TexasObserver]

40. Recommend

[Roland99]

47. Here's The REAL Reason Commercial Real Estate Is Different This Time

Here's The REAL Reason Commercial Real Estate Is Different This Time
http://www.businessinsider.com/heres-the-real-reason-commercial-real-estate-is-different-this-time-2009-11

Not sure the chart therein will post here properly so just go there. :-)

[DemReadingDU]

48. Weiss: The Great Recovery Hoax of 2009-2010

11/2/09 Martin Weiss: The Great Recovery Hoax of 2009-2010

Before he died, Dad warned me of false profits … and fake promises.

“Beware,” he said, “of shaky gains hyped up by Wall Street.

“Watch out,” he insisted, “for unsustainable economic recoveries trumpeted by Washington.

“And no matter when or where you may be, don’t be fooled by illusions of wealth and prosperity.

“If they’re built on a foundation of shaky debt, they’re suspect. If they’re driven by unbridled speculation, they’re pure fluff. And if they’re bought and paid for by Washington, they will certainly end in catastrophe.”

Sure enough, in the years that followed, millions of Americans were fooled by illusions of wealth created by the Great Tech Bubble of 1998-1999.

Millions more were fooled for a second time by illusions of prosperity in the Great Housing Bubble of 2005-2006.

And now, despite these blatant lessons of history, they are being fooled again — this time, in …

The Great Recovery Hoax of 2009-2010

There can be no debate that, in each of these episodes, things did go up: The Nasdaq soared before it crashed. The median price of U.S. homes skyrocketed before it collapsed. And now, the U.S. economy has reversed course — from four consecutive quarters of contraction to at least one quarter of expansion.

There also can be no doubt that these trends do not end overnight. They can continue for months — often plowing over skeptics and even exceeding the expectations of believers.

Most important, however, there can be no question that all three of these episodes have had one key element in common that ultimately self-destructs: Massive intervention, support, and free money from Washington.
.
.
Recommendations:

First, don’t fall for the hoax.

Second, don’t expect Washington to back off immediately.

Third, don’t wait around for the next disaster before taking protective action.

Fourth, no matter what your trading approach may be, don’t forget the importance of cash.

more...
http://www.moneyandmarkets.com/the-great-hoax-of-2009-2010-2-36247

[Roland99]

49. Roubini: The New Dollar Carry-Trade Is A Disaster In The Making

Roubini: The New Dollar Carry-Trade Is A Disaster In The Making
http://www.businessinsider.com/roubini-the-new-dollar-carry-trade-is-bound-to-blow-up-2009-11

And just as the dollar is showing some signs of life, and just as the market shows an inlking of a breakdown, here comes Roubini warning about the coming bust of the carry trade.

FT: The reckless US policy that is feeding these carry trades is forcing other countries to follow its easy monetary policy. Near-zero policy rates and quantitative easing were already in place in the UK, eurozone, Japan, Sweden and other advanced economies, but the dollar weakness is making this global monetary easing worse. Central banks in Asia and Latin America are worried about dollar weakness and are aggressively intervening to stop excessive currency appreciation. This is keeping short-term rates lower than is desirable. Central banks may also be forced to lower interest rates through domestic open market operations. Some central banks, concerned about the hot money driving up their currencies, as in Brazil, are imposing controls on capital inflows. Either way, the carry trade bubble will get worse: if there is no forex intervention and foreign currencies appreciate, the negative borrowing cost of the carry trade becomes more negative. If intervention or open market operations control currency appreciation, the ensuing domestic monetary easing feeds an asset bubble in these economies. So the perfectly correlated bubble across all global asset classes gets bigger by the day.

But one day this bubble will burst, leading to the biggest co-ordinated asset bust ever: if factors lead the dollar to reverse and suddenly appreciate – as was seen in previous reversals, such as the yen-funded carry trade – the leveraged carry trade will have to be suddenly closed as investors cover their dollar shorts. A stampede will occur as closing long leveraged risky asset positions across all asset classes funded by dollar shorts triggers a co-ordinated collapse of all those risky assets – equities, commodities, emerging market asset classes and credit instruments.

What's scary about the carry trade this time is that it's the world's underlying, reserve currency that's the source of the trade. The yen is a big deal, but it's nothing like the dollar. If it reverses violently: watch out.

[Demeter]

51. Oh, That's Just Obscene

Up 111 pts? The PPT is at it again, trying to forestall the inevitable, or at least, conceal it from the rubes.

[DemReadingDU]

57. It was up 140 earlier, coming back down. now 52.

That PPT keeps trying, but I don't know how much longer before the inevitable.


Edit 12:57
CNN: Stocks turn lower. Dow erases 145 point gain while the Nasdaq and S&P also lose ground.

[Dr.Phool]

62. In the red at 2:00 pm.

Green shoots were rotten onions.

[Demeter]

52. CIT bankruptcy assigned to judge who had GM case

http://news.yahoo.com/s/nm/20091102/bs_nm/us_cit_8

[Demeter]

63. CIT bankruptcy reassigned after recusal

LOOKS LIKE THIS ONE'S A HOT POTATO!

http://news.yahoo.com/s/nm/20091102/bs_nm/us_cit_9

CIT Group Inc's bankruptcy case was reassigned on Monday to U.S. Bankruptcy Judge Allan Gropper following the recusal of Judge Robert Gerber, who had been assigned the case hours earlier.

A courtroom deputy for Gropper said Gerber recused himself from the case. The deputy did not give a reason for the recusal. Gerber's chambers had no immediate comment.

CIT, a source of financing to about one million small and mid-sized businesses, filed for Chapter 11 protection from creditors on Sunday after gathering support from most of its bondholders for its "prepackaged" reorganization.

The bankruptcy filing, one of the five largest in U.S. history, followed a failed debt exchange offer.

CIT said it hopes to emerge from bankruptcy by the end of the year and reduce its debt by $10 billion. The New York-based company intends to keep lending, and a quick reorganization is crucial if it expects to retain most customers.

Gropper has been a bankruptcy judge since 2000. His cases have included the reorganization of Northwest Airlines Corp, which later merged with Delta Air Lines Inc, and the current proceedings for the giant mall owner General Growth Properties Inc.

Before joining the bench, Gropper was a partner at White & Case, where he was involved in many of the largest U.S. bankruptcies, including Federated Department Stores and Texaco. He has degrees from Yale University and Harvard Law School.

According to its bankruptcy petition, CIT had $71 billion of assets and $64.9 billion of liabilities on June 30.

In morning trading, CIT shares fell 44 cents, or 61 percent, to 28 cents. The New York Stock Exchange said it would suspend trading in CIT prior to Tuesday's market open.

The case is In re CIT Group Inc, US Bankruptcy Court, Southern District of New York, Case No. 09-16565.

[Tansy_Gold]

69. $71B assets, $64.9B liaibilities --- doesn't that make them

insolvent, but not bankrupt?

Just wondering.




Tansy Gold, who hasn't been an accountant for a long long long long time. . . . . . .

[Demeter]

70. Unless You Can Verify The Numbers

I'd pick the worst case. Even if it isn't true, GS will make it so!


additional thought: they probably don't count the bailout money as a liability, since there was no plan to return it ever...

[Demeter]

54. Cruel windfall: How wars, plagues, and urban disease propelled Europe’s rise to riches

http://www.voxeu.org/index.php?q=node/3823

Swine flu, Afghanistan, Iraq, Pakistan...it's all ben done before!

Interesting contrast between European and Asian civilizations and empires and what made them diverge.

[Demeter]

65. Obama warns more job losses coming

http://news.yahoo.com/s/nm/20091102/bs_nm/us_obama_economy_31



WASHINGTON (Reuters) – U.S. President Barack Obama said on Monday that more U.S. jobs will be lost in coming weeks and months but stressed the economy has recovered a lot of ground since he took office in January.

Speaking at a White House meeting of his Economic Recovery Advisory Board, Obama said the current pace of job losses was "distressing" and the labor market would not improve quickly.

"We anticipate that we are going to continue to see some job losses in the weeks and months to come," Obama said.

The advisory board's meeting was shown on a White House website in a departure from normal practice.

Obama said the economy was beginning to stabilize after the deep slump that it entered amid a U.S. and global financial crisis but said it still had a long way to go and that policymakers need to find new models for future growth.

"It's not going to happen overnight, but we will not rest until we are succeeding, until we are generating the jobs that this economy needs," the President said before the official board meeting started.

He said past U.S. growth had been "debt-driven" and that was no longer feasible. With the United States running record budget deficits as it spends furiously to try to stimulate the economy, Obama said it is going to be vital to find innovative new ways to finance growth.

The U.S. economy posted solid growth in the third quarter after a year of steady decline, with gross domestic product rising at a 3.5 percent annual rate.

In addition on Monday, U.S. manufacturing activity hit its highest level in 3-1/2 years in October and pending home sales surged in September -- all signs of vitality returning to a battered economy.

Obama urged policymakers to consider new ways to spur growth, not simply changes in tax policy, and said that he was confident that job growth will return once the economy is back on a solid growth track.

:banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :banghead: :spank: :spank: :spank: :spank: :spank: :spank:


DON'T YOU LONG FOR THE DAYS WHEN A PRESIDENT WOULD BE QUOTED VERBATIM, AND WOULD ACTUALLY MOVE THE RUSTY LEVERS OF GOVERNMENT FOR THE PEOPLE? OR AM I IMAGINING A MYTHICAL TIME?

IF THIS IS OBAMA'S "NOT RESTING" STATE, HE MUST BE POSITIVELY INERT WHEN HE'S NOT WORKING FOR US!

[skoalyman]

79. OR AM I IMAGINING A MYTHICAL TIME?

yes it was when dinos walked the earth and the aliens were busy building the pyramids:hi: :tinfoilhat: about the time we default they'll come to there senses.

[RUMMYisFROSTED]

71. 97?

97 makes a lot more sense than 9700.

:think: