STOCK MARKET WATCH, Tuesday August 14

[ozymandius]

Source: DU

Tuesday August 14, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 527 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2412 DAYS
WHERE'S OSAMA BIN-LADEN? 2124 DAYS
DAYS SINCE ENRON COLLAPSE = 2085
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.

AT THE CLOSING BELL ON August 13, 2007

Dow... 13,236.53 -3.01 (-0.02%)
Nasdaq... 2,542.24 -2.65 (-0.10%)
S&P 500... 1,452.92 -0.72 (-0.05%)
Gold future... 680.90 -0.70 (-0.10%)
30-Year Bond 5.01% +0.00 (+0.06%)
10-Yr Bond... 4.78% +0.00 (+0.04%)






GOLD, EURO, YEN, Loonie and Silver

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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

[UpInArms]

1. dollar watch

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

Last trade 81.294 Change +0.190 (+0.23%)

Dollar Gains Ground as Markets Stabilize; Wednesday's CPI Set to Be the Clincher for Fed Expectations

http://www.dailyfx.com/story/topheadline/Fear_Factor__Dollar_Rebounds_As_1186981176742.html

The US Dollar started out the week stronger against most of the majors, as better-than-expected retail sales helped quell fears that the subprime contagion would lead consumption growth to stall. Furthermore, multiple central banks – including the Federal Reserve, Bank of Japan, and European Central Bank – continued to inject liquidity into the money markets, which helped to stabilize global equities. Focusing on the economic data at hand, retail sales during the month of July rose a stronger-than-expected 0.3 percent. Excluding autos and gas, the reading was even more encouraging, as sales rose 0.6 percent from the month prior. A breakdown of the data shows that clothing purchases led the increase, which is somewhat surprising after apparel retailers such as Abercrombie & Fitch, Gap Inc., and American Eagle Outfitters Inc. all reported dismal same-store sales for the month. Nevertheless, it appears that heavy discounting by stores such as Wal-Mart helped keep July's headline reading afloat and should help alleviate some concerns that consumer spending growth has stalled, especially after consumption slowed dramatically in the second quarter GDP report. Markets will be anxiously awaiting Wednesday’s CPI report, as signs that price pressures remain uncomfortably high for the Fed could lead fixed income markets to stop pricing in a September rate cut, since the central bank is unlikely to risk letting inflation get out of hand in order to spare the equity markets.

...more...

Chinese Consumer Price Inflation Rises To Highest In 10 Years

http://www.dailyfx.com/story/dailyfx_reports/top_fx_market_movers/Chinese_Yuan_Depreciates_Against_The_1187035738774.html

Chinese Yuan Depreciates Against The US Dollar, Yuan Rise Seen As Detrimental

Although advancing shortly after the consumer price report, the Chinese yuan pared back and fell to 7.5812 following comments by a high ranking official that noted appreciation in the yuan is not what is desired. The official stated that any “big appreciation” would hurt the Chinese economy and slow job growth. The overnight comments dulled expectation of a near term revaluation in the currency but heightened the likelihood of a near term rate hike.

Chinese Consumer Price Inflation Rises To Highest In 10 Years

Consumer prices in the world’s fastest growing economy rose to the highest level in 10 years. Remarkably, the economic gauge surged far past consensus estimates of 4.6 percent, printing 5.6 percent for the month of July according to the National Bureau of Statistics. Attributed to the extraordinary rise were food prices that jumped a whopping 15.4 percent after shortages in pigs and thinned out crops lent to reduced supplies. Price increases seem to be rising out side of food as well, as noted by the central bank on August 8th. As a result, the report has prompted further speculation by the market that rate increases will surely follow in the near term. Heavy estimates are for another round of tightening by the People’s Bank of China, the fourth in 2007, as well as more inventive measures of controlling what seems to be an overheating economy.

Foreign Direct Investment Continues To Power Economy

Investment on the part of overseas companies continued on a healthy pace for the first seven months of the year. Increasing by 12.9 percent, actual FDI increased by $36.9 billion compared to last year’s results, according to the Ministry of Commerce today. In the month of July alone, foreign direct investment rose by $5 billion, higher by almost 18 percent. Surprisingly, however, the number of new foreign funded companies declined against last year’s assessment by 4.81 percent. The finding suggests that foreign companies may be paring back exposure in the economy, at least in the near term, on concern of market dynamics.

China Promises No Dollar Dump

Released over the weekend, a Chinese central bank official was quoted as saying that China had no intention of dumping dollar reserves in the near term. The assurances come but a weekend after it was reported by the Daily Telegraph that Chinese officials may exercise their “nuclear option”, selling off the world’s largest investment in US Treasuries. Subsequently, the official noted that China remained a “responsible investor” and seeks to manage its foreign currency reserves in a long term perspective. Although news to the markets, traders had already expected as much considering the irreparable damage such an event may have on Chinese reserves. A dumping of US dollar assets would accelerate the current pace of appreciation in the underlying yuan as well as reducing the value of remaining reserves, totaling $1.33 trillion as of June.

...more...

[mojavekid]

32. Daily Pfennig 8/14/07: Shootin' Up Some Crude...

http://www.kitcocasey.com/displayArticle.php?id=1536

Well... U.S. Retail Sales were modestly firm in July, just as the BHI had predicted once again! With oil prices coming back down this summer, it only makes sense that retail sales would be stronger... However, as I said, they were no more than "modestly firm" coming in at .3%...

The data gave further strength to the dollar bulls to continue buying dollars, and the currencies all lost ground during the day. And here's where I'm going to say some very important words to you all... I've been sitting here watching the subprime meltdown extend its ugly tentacles around the globe, and I did a V-8... Wow! I could've had a V-8! And... I should have seen this long ago!

With the subprime meltdown going global, it's no longer just a problem for the U.S. and the dollar. And after this huge run-up this summer in the currencies, I see a consolidation on the horizon... The currencies are consolidating at this time, and we should look for them to back off vs. the dollar for a short time, before heading back up again later this year...

snip...

OK... On to other things... Recall yesterday I talked about how the European Central Bank needed to remember that all that liquidity they were injecting was nothing more than money supply, which would lead to higher inflation in the future...

Well... The Reserve Bank of Australia (RBA) is already admitting that their inflation level will reach the top of their target of 3%... The RBA issued this statement... "Core inflation will quicken to 3 percent by December and remain there next year." This after previously announcing that inflation would remain in the 2.5% range...

I think that the RBA's work regarding their fight against inflation has more rate hikes in their future... Economic growth is still strong, and as I will tell you in the next paragraph, so too is that of China, and we all know what effect China's demands for commodities have on Australia's growth!... And so... While the Aussie dollar may be consolidating right now... I fully expect it to recover later...

more...

[Ghost Dog]

51. Pound below $2 after inflation data

http://mwprices.ft.com/custom/ft2-com/html-story.asp?pulse=true&siteid=ft&dist=ft&guid=%7B88eb17c5%2D5e6d%2D48dc%2Dafb4%2D96f347879b30%7D

Sterling fell below $2 for the first time in over six-weeks on Tuesday as expectations for further UK interest rates rises tumbled after inflation data came in far weaker than expected. UK consumer price inflation fell to 1.9 per cent in July, below the Bank of England’s 2-per-cent target for the first time since March 2006 and well below expectations for a 2.3 per-cent reading. Chiara Corsa, economist UniCredit, said given last week’s inflation report from the Bank of England had laid the ground for another rise in UK interest rate, the chances of another 25 basis point increase to 6 per cent were still high. However, she said the data weakened the case for such a move. “There is no doubt that after this inflation number the BoE won’t be in hurry to hike and will wait for further evidence before hiking again,” said Ms Corsa. The pound dropped 0.6 per cent to $1.9995 against the dollar, 0.4 per cent to £0.6790 against the euro and 0.6 per cent to Y236.40 against the yen.

---

[Ghost Dog]

53. Euro Falls Versus Dollar on Signs Subprime Losses Spreading

http://www.bloomberg.com/apps/news?pid=20601083&sid=aobrlNtLQqXU&refer=currency

Aug. 14 (Bloomberg) -- The euro declined a second day against the dollar and yen on speculation losses from U.S. subprime mortgage are spreading to Europe.

Europe's common currency touched the lowest in more than six weeks versus the dollar after a Spanish newspaper reported Banco Santander SA has more than 2 billion euros ($2.7 billion) of investments in U.S. high-risk loans. UBS AG said profit may be hit this year because of turmoil in financial markets. The euro has dropped 1.8 percent since July 20 when a global rout of stocks and corporate bonds started.

``The euro is under pressure,'' said Matthew Strauss, a senior currency strategist at RBC Capital Markets Inc. in Toronto, a unit of Canada's biggest bank by assets. ``European financial institutions are getting exposed to the subprime losses. Investors will be less willing to hold euro assets.''

The euro fell to $1.3577 at 10:35 a.m. in New York, from $1.3613 yesterday, and earlier touched $1.3563, the weakest since July 2. The euro also declined 0.4 percent to 160.31 yen, from 160.97 yesterday, after earlier reaching 159.90, the lowest since April 19.

The yen rose to 118.03 per dollar from 118.25 yesterday as U.S. stocks declined, pushing traders to exit riskier investments funded by loans in Japan, a practice known as the carry trade.

/...

[Ghost Dog]

54. Euro, pound lower as dovish data diminish rate hike expectations

http://www.iii.co.uk/news/?type=afxnews&articleid=6240427&subject=markets&action=article

LONDON (Thomson Financial) - The euro and the pound both fell after weak economic data called into question the likelihood of higher borrowing costs.

The pound fell briefly below the 2 usd level, and was markedly weaker against other currencies, after annual CPI inflation came in at 1.9 pct in July, far below analyst expectations for 2.2 pct and the lowest reading since March 2006.

It is also the first time inflation has come in below the Bank of England's target rate of 2.0 pct since that month, serving to diminish expectations the central bank will raise interest rates again this year.

David Brown at Bear Stearns said the weak inflation reading means the BoE "will have a hard time justifying a further hike in rates, especially set against the current troubled financial market backdrop."

He believes the view that UK rates have peaked at the current level of 5.75 pct will keep the pound under the psychologically important 2 usd figure.

The inflation news added to pressure on the pound, which was already weakened by a soft housing survey.

The Royal Institution of Chartered Surveyors said UK house prices grew below their long-run average in July, as new buyer enquiries fell at their fastest rate in nearly three years in the wake of higher borrowing costs.

Elsewhere, the euro fell below 1.36 usd for the first time in over a month as weaker-than-expected growth figures diminished prospects for another hike in euro zone interest rates.

Both German and French GDP growth eased in the second quarter to a quarterly 0.3 pct, against expectations of 0.3 pct increases in both countries.

Euro zone GDP, which came out an hour later, confirmed the sluggish indications with a rise of 0.3 pct on the first quarter and 2.5 pct year on year, missing expectations for rises of 0.6 pct and 2.8 pct respectively.

The disappointing growth figures may raise doubts at the European Central Bank about the need for another increase in the key refi rate from the current 4.00 pct.

Those doubts will be further reinforced on Thursday if the final HICP July inflation figure for the euro zone remains well below the 2 pct year-on-year rate for the 11th consecutive month. The flash estimate was weaker than expected, slipping to 1.8 pct year on year from 1.9 pct.

/...

[UpInArms]

2. Credit Squeeze Puts Europe's Bank in Spotlight

http://www.nytimes.com/2007/08/14/business/worldbusiness/14euro.html?ex=1344744000&en=4bf2c09a6ec04833&ei=5088&partner=rssnyt&emc=rss

FRANKFURT, Aug. 13 — The rest of Europe may be deep into its annual summer idyll, but the European Central Bank has been a hive of activity since last Thursday, when it thrust itself into a market rattled by fears of a credit crisis.

On Monday, the bank injected 47.7 billion euros ($65 billion) into the financial system to keep European money markets from drying up. It was the third emergency operation in three business days, starting with a bold injection of 94.8 billion euros ($129 billion) on Thursday morning.

The moves have put a spotlight on the European Central Bank, which has traditionally played a supporting role to the United States Federal Reserve during global financial crises. This time, the Europeans acted earlier, and on a far larger scale, than the Fed or their Asian counterparts.

Some market commentators have accused the bank of panicking, saying its intervention could send the wrong signal to hedge funds or other institutions engaged in high-wire investing: Namely, that they should expect a monetary safety net. Still, the remedy seems to have worked, at least for now, preventing the problems in the United States mortgage-lending market from draining broader markets in Europe. In a statement issued with its latest tender offer on Monday, the European Central Bank said “money market conditions are normalizing” and that the “supply of aggregate liquidity is ample.”

The Federal Reserve and the central banks of Japan and Australia also injected funds into the market.

<snip>

After the European bank’s initial injection of 94.8 billion euros at a rate of 4 percent — its first such intervention since the aftermath of Sept. 11, 2001 — the subsequent tenders on Friday and Monday represent a type of mopping up, Mr. Nielsen said.

...more...

[UpInArms]

3. Central banks wean investors off extra funds

http://www.reuters.com/article/bondsNews/idUSL1473387220070814?sp=true

FRANKFURT/SYDNEY, Aug 14 (Reuters) - The European Central Bank added extra funds to markets for a fourth day on Tuesday but on a smaller scale, as central banks slowly pull out extra cash pumped in to avert panic about a credit squeeze.

Asia's central banks were back to business as usual and although investors remained cautious, there was little sign of the frantic selling of late last week.

European shares fell 0.6 percent, but this followed the biggest one-day rally in 15 months on Monday. The fall was in line with moves in the United States and Asia, where stocks slipped but bonds edged up as risk appetite remained weak.

The ECB said money market conditions were now close to normal, following concerted action by central banks around the world which have added hundreds of billions of dollars of temporary cash since last week.

"The central banks acted quickly to keep the banking system ticking over and that's helped avoid a dramatic liquidity squeeze," said Peter Jolly, head of research at nabCapital.

"But people are clearly still nervous, wondering where the next body is buried."

...more...

[UpInArms]

4. BOJ drains Y1.6 trln to reverse call rate plunge

http://www.reuters.com/article/bondsNews/idUST27882420070814

TOKYO, Aug 14 (Reuters) - The Bank of Japan drained a total of 1.6 trillion yen ($13.6 billion) from the banking system on Tuesday, reversing two days of cash injections that drove overnight call rates to near zero as global money markets calmed.

The BOJ drained 1 trillion yen ($8.5 billion) in a bill selling operation to start later this session and expire on Thursday, after earlier absorbing 600 billion yen through bill selling in a one-day operation.

Japan's overnight call rate traded as low as 0.01 percent (TANSHI: Quote, Profile, Research) but inched up to 0.15 percent after the second fund absorption operation, still well below the BOJ's target of 0.5 percent.

Low overnight call rates despite the BOJ's fund absorptions indicate that Japan's money market is far more stable than those abroad and the exposure of domestic financial institutions to risky U.S. subprime mortgages is seen limited.

There was also an abundance of cash in the banking system as many financial institutions have already set aside more funds than necessary ahead of the end of the BOJ's monthly reserve maintenance period on Wednesday.

...more...

[AnneD]

31. Morning Marketeers....

:donut: and lurkers. Love that quote UIA "But people are clearly still nervous, wondering where the next body is buried." It has become obvious that the banks ARE scared that folks will wake up so they are passing out cash like Soma.

It reminds me of another quote: "You take the blue pill, the story ends and you wake up believing whatever you want to believe. You take the red pill, you stay in wonderland and I show you just how deep the rabbit hole goes." The Central Banks are passing out the blue pills but I think some folks have already taken the red pills. But the real question is-just how deep IS this rabbit hole.

Either the big boys are moving their money around now and they don't want folks to panic until they are finished or they don't want us to know how unsound some of the fundamentals really are.

On the home front we have some good news bad news. The good news is that the heat wave make break-the bad news is that a we may be getting a tropical depression or hurricane to break it. We will be watching the Gulf of Mexico this weekend to see where this thing is going and how strong it gets. It is also tax free weekend here so parents will be out shopping for school things. It is a big deal here.

Happy hunting and watch out for the bears.

[DemReadingDU]

33. I think it's both

"Either the big boys are moving their money around now and they don't want folks to panic until they are finished or they don't want us to know how unsound some of the fundamentals really are."


Yep, the big boys know these investments are unsound and us little people are finally wising up to them! So the big boys are taking their profits and probably moving them to a secret Swiss bank account.

[Hugin]

67. "How deep does the rabbit hole go?" I've had the theme to the movie, "Black Hole" on...

endless loop in my head the past couple of days.

[UpInArms]

5. Prudential's subprime exposure bears watching: Citi

http://www.reuters.com/article/businessNews/idUSN1328494120070813?feedType=RSS&feedName=businessNews

NEW YORK (Reuters) - Prudential Financial Inc. has the riskiest investment portfolio, including subprime exposure, among life insurers, while MetLife Inc. and Genworth Financial Inc. should be closely monitored, Citigroup analyst Colin Devine said in a report on Monday.

Devine said Prudential's (PRU.N: Quote, Profile, Research) portfolio had the greatest exposure to high-risk assets at 13.8 percent, with MetLife (MET.N: Quote, Profile, Research) close behind at 13.6 percent. Genworth (GNW.N: Quote, Profile, Research) followed with 9 percent, he said.

The average level of high-risk assets for life insurers as a percentage of total investments was 7.8 percent for 15 publicly traded life insurers, Devine said.

The Citigroup analyst defined high risk as below investment grade bonds, equities, real estate and other partnerships and joint ventures.

...more...

[salin]

12. Citi May Lose $3 Billion in Debt Rout, Bernstein Says

http://www.bloomberg.com/apps/news?pid=20601103&sid=ahW1pLE7WZ7I&refer=us

Citi May Lose $3 Billion in Debt Rout, Bernstein Says

By Sebastian Boyd

Aug. 14 (Bloomberg) -- Citigroup Inc., the biggest U.S. bank by assets, may lose as much as $3 billion in the third quarter because of the credit crisis, according to analysts at Sanford C. Bernstein & Co. LLC.

The New York-based company may lose between $1.2 billion and $1.5 billion on loans to buyout firms and between $500 million and $1 billion on subprime mortgages in the three months ending Sept. 30, Bernstein analysts Howard Mason and Michael Howard said today in a note to clients.

Banks may have marked down between 15 percent and 20 percent of the value of leveraged loans in July, and Citigroup could have marked down around $200 million to $300 million that month, the analysts said. The average extra-risk premium, or spread, that investors demand on loans to buyout firms buying companies with debt rose about 300 basis points in July, the analysts wrote.

snip....

[wordpix]

27. that's a lot to lose---interesting that Citi is dissing Prudential, MetLife, et. al. in above story

[ozymandius]

6. Market WrapUp

Analysis of the Unfolding OTC Derivatives Melt Down
BY ROB KIRBY

In the past few weeks we’ve all been ‘peppered’ with reports about CDO’s and growing contagion associated with sub-prime mortgages.

For clarity’s sake – everyone should first understand that these instruments are – for the most part – all broadly defined as OTC derivatives.

What now appears to be ‘systemic problems’ in the Financial System all began with revelations by Bear Stearns.

Interestingly, in Bear Stearns latest 10-K filing with the SEC, they self-describe (at the top of page 54 if you want to play along at home) their activities conducted in off-balance-sheet-arrangements are described as follows:

In the normal course of business, the Company enters into arrangements with special purpose entities ("SPEs"), also known as variable interest entities ("VIEs"). SPEs are corporations, trusts or partnerships that are established for a limited purpose. SPEs, by their nature, are generally not controlled by their equity owners, as the establishing documents govern all material decisions. The Company's primary involvement with SPEs relates to securitization transactions in which transferred assets, including commercial and residential mortgages, consumer receivables, securities and other financial assets are sold to an SPE and repackaged into securities or similar beneficial interests. SPEs may also be used to create securities with a unique risk profile desired by investors and as a means of intermediating financial risk. The Company, in the normal course of business, may establish SPEs, sell assets to SPEs, underwrite, distribute and make a market in securities or other beneficial interests issued by SPEs, transact derivatives with SPEs, own securities or other beneficial interests, including residuals, in SPEs, and provide liquidity or other guarantees for SPEs.

-cut-

To be honest, I’m still having trouble getting my head around “how” Bear could have lost the amounts being bandied about in the market place – but based on anecdotal reports concerning ratings downgrades of investment grade paper – the bulk of Bear’s problems must be stemming from the AAA, AA, and A segments in the table above. To lose 3 billion on this amount of aggregate business implies a “virtual write-off” of the whole business segment.

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

[antigop]

34. Weren't SPEs used by ENRON?

http://www.nysscpa.org/cpajournal/2002/1202/features/f122002.htm

>>
Enron’s demise began when investors became aware of “off–balance sheet” partnerships that hid billions of dollars of liabilities. Many entities, like Enron, used special purpose entities (SPE) because as long as at least 3% of capital comes from outsiders, an SPE can be left off the consolidated financial statements of the parent company.
>>


Also see:
http://news.findlaw.com/hdocs/docs/enron/sicreport/chapter1.pdf

I'm still reading about all of this, trying to figure it out....

[UpInArms]

7. Las Vegas, Detroit foreclosure rates double-report

http://www.reuters.com/article/bondsNews/idUSN1440604420070814

NEW YORK, Aug 14 (Reuters) - U.S. home foreclosure rates in the Las Vegas and Detroit metropolitan areas doubled in the first half of 2007 from a year ago, a report said on Tuesday.

U.S. home foreclosures rates were highest in Stockton, California, Detroit and Las Vegas for the 100 largest metropolitan areas in the first six months of 2007, said RealtyTrac, an online marketplace for foreclosure properties.

Stockton, to the east of San Francisco, suffered one foreclosure filing for every 27 households for a rate that tripled from the same period in 2006.

In the first half of 2007, Detroit showed the second highest foreclosure rate among the nation's 100 largest metropolitan areas with one foreclosure filing for every 29 households, while Las Vegas was third with one foreclosure filing for every 31 households.

...more...

[DemReadingDU]

21. Ohio foreclosures too

California and Ohio Cities Account for 10 of Top 20 Metro Foreclosure Rates
"While foreclosure activity has skyrocketed over the past year in many cities, particularly in California, Ohio and the Northeast, foreclosure activity seems to be subsiding in parts of Texas,
South Carolina and other states. Still, the overall trend is toward
escalating foreclosure rates, with 82 of the top 100 metro areas reporting year-over-year increases in the number of homes affected by foreclosure.


click to see chart of Foreclosure Activity for the Nation's 100 Largest MSAs - Jan to Jun 2007

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/08-14-2007/0004644880&EDATE=

[ozymandius]

8. Today's Reports

8:30 AM PPI Jul
Briefing Forecast 0.1%
Market Expects 0.1%
Prior -0.2%

8:30 AM Core PPI Jul
Briefing Forecast 0.1%
Market Expects 0.2%
Prior 0.3%

8:30 AM Trade Balance Jun
Briefing Forecast -$61.0B
Market Expects -$61.0B
Prior -$60.0B

http://biz.yahoo.com/c/e.html

[UpInArms]

11. 8:30 reports:

03. U.S. July core PPI up 2.3% in past year, most in 2 years
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

04. U.S. July PPI crude goods prices up 1.2%
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

05. U.S. June trade gap with China $21.2 bln vs $19.6 bln yr-ago
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

06. U.S. July PPI core intermediate up 2.4% in past year
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

07. U.S. May trade gap rev $59.2 bln vs $60.0 prev est
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

08. U.S. July PPI energy prices rise 2.5%
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

09. U.S. June trade gap lowest since Feb.
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

10. U.S. June trade gap below consensus of $61.3 bln
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

11. U.S. July PPI foods prices fall 0.1%, third straight decline
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

12. U.S. June trade gap narrows 1.7% to $58.1 bln
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

13. U.S. July core PPI up 0.1% as expected
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

14. U.S. July PPI up 0.6% vs. 0.3% expected
8:30 AM ET, Aug 14, 2007 - 5 minutes ago

[mojavekid]

35. AP: Wholesale Inflation Up Sharply in July

http://biz.yahoo.com/ap/070814/wholesale_prices.html?.v=5

Wholesale Inflation Up Sharply in July but Outside of Energy Prices Remain Moderate


WASHINGTON (AP) -- A big jump in energy costs pushed inflation at the wholesale level up sharply in July. However, outside of energy, price pressures were moderate.
The Labor Department reported that wholesale prices rose by 0.6 percent in July. That was far above the 0.1 percent that analysts had expected and reflected a big jump in energy costs.

But core wholesale inflation, which excludes volatile food and energy costs, rose by a much more moderate 0.1 percent, even better than the 0.2 percent gain analysts had expected.

The Federal Reserve said at its meeting last week that it still saw the possibility that inflation will not moderate as the biggest threat to the economy.

However since that meeting, financial markets have been roiled by problems in global credit markets. That has raised expectations among investors that the Fed will move in coming months to cut interest rates to make sure that widening credit problems don't push the country into a recession.

more....

and we are already in a recession.

[roamer65]

72. Yup, we are in recession...

and its gonna be an inflationary one like 1974-75. The dollar's strength will only be temporary as money supply growth is around 13% right now.

[ozymandius]

9. Oil prices steady

Oil prices were little changed Tuesday as concerns over a tropical storm eased with a revised forecast that predicted the storm will turn away from the Gulf of Mexico. Weekend refinery problems also turned out not to be as bad as initially thought.

Light, sweet crude for September delivery rose 17 cents to $71.79 a barrel in electronic trading on the New York Mercantile Exchange midday in Europe. The contract rose 15 cents to settle at $71.62 a barrel Monday.

September Brent crude edged up 2 cents to $70.27 a barrel on the ICE futures exchange in London.

Tropical Depression Four, located in the central Atlantic Ocean, is strengthening and bearing down on the Caribbean Sea. But forecasters now believe the storm will swing north toward the Eastern Seaboard and away from the Gulf, where it might interrupt production and oil shipments.

-cut-

After weeks of increased U.S. refinery activity and growing gasoline inventories, gasoline futures fell steeply over the last month. But last week's inventory report from the Energy Department's Energy Information Administration rekindled supply concerns by showing a sharp decline in both refinery activity and gas inventories.

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

[ozymandius]

10. OPEC ups estimate for oil demand growth despite world economic woes

VIENNA (AFP) - OPEC has slightly increased its estimate for world oil demand growth in 2007 despite current economic turmoil, the powerful cartel said in a report Tuesday.

"World oil demand growth in 2007 is forecast at 1.3 million barrels per day (bpd), or 1.5 percent, slightly higher than the estimate for last month, reflecting additional oil needs for Japanese power plants," the Organization of Petroleum Exporting Countries said in its monthly report.

-cut-

It said US economic problems such as the "recession in the housing sector, in particular the subprime mortgage market" have precipitated "fears of a global economic slowdown."

In addition, "OECD oil demand, affected by the warm winter, led to a decline in oil consumption in both Europe and the Pacific."

But "non-OECD oil demand was as strong as expected. Booming economies pushed oil demand up by 3.5 percent or 1.22 million bpd, year-on-year, in the first half of 2007. China, the Middle East and India accounted for the largest share of oil demand," OPEC said.

http://news.yahoo.com/s/afp/20070814/ts_afp/opecenergyoil_070814111534

[4dsc]

23. To bad its all about supply!!

Latest developments:

1) Crude oil - Production of crude oil decreased by 503,000 b/d from April to May. Total production in May was estimated at 73.06 million b/d by the Energy Information Administration (EIA), which is 1.21 million b/d lower than all time high crude oil production of 74.27 million b/d reached in May 2005.

2) Total Liquids- Production of all Liquid fuels decreased by 550,000 barrels per day from May to June, according to the latest figures of the International Energy Agency (IEA). Resulting in total world liquids production of 84.28 million b/d, which is 564,000 b/d lower year on year from June 2006 to June 2007 and 1.85 million b/d lower than all time maximum liquids production of 86.13 million b/d reached in July 2006.

3) OPEC - Total crude oil production of the OPEC cartel decreased by 50,000 b/d to a level of 30.16 million b/d from May to June, according to the latest estimates of the IEA. Preliminary figures from the EIA show an increase of 370,000 b/d from June to July resulting in OPEC crude production of 30.37 million b/d.

http://europe.theoildrum.com/node/2864#more

[ozymandius]

13. Mattel could announce 2nd toy recall

NEW YORK - Less than two weeks after Mattel Inc. recalled 1.5 million Chinese-made toys because of lead paint, the toy industry is bracing for another blow that could give parents more reason to rethink their purchases just before the critical holiday shopping season.

-cut-

Mattel is set to announce the recall of another toy involving a different Chinese supplier as early as Tuesday, according to three people close to the matter who spoke on condition of anonymity because of the sensitivity of the situation.

Details of the latest recall were not immediately available, but one of the three people confirmed early Tuesday that Mattel plans to recall several hundred thousand die cast cars because their paint may contain excessive amounts of lead.

-cut-

A new Mattel action would mark the latest in a string of recalled products from China, ranging from faulty tires to tainted toothpaste. With more than 80 percent of toys sold worldwide made in China, toy sellers are nervous that shoppers will shy away from their products.

http://news.yahoo.com/s/ap/20070814/ap_on_bi_ge/toy_recall

[salin]

14. Goldman Sachs shells out to stanch bleeding

Goldman Sachs shells out to stanch bleeding

By JOE BEL BRUNO

The Associated Press

Eli Broad among group investing in ailing fund.
NEW YORK — Goldman Sachs Group said Monday it is leading a group of investors including Maurice "Hank" Greenberg and Eli Broad in injecting $3 billion into one of its hedge funds that lost 28 percent of its value last week.

The investment bank said its Global Equity Opportunities fund, one of its largest hedge funds, "suffered significantly" as global markets sold off on worries about debt and credit, dragging its value down to $3.6 billion, from about $5 billion last month.

Goldman Sachs will invest $2 billion. Other investors will contribute about $1 billion to the fund, whose computer-driven "quantitative" investment strategies were disrupted by triple-digit swings in the financial markets.

"This is not a rescue," said Goldman Chief Financial Officer David Viniar. "Given the dislocation in the market, we believe this is a good investment opportunity for us and other investors."

...more...

http://seattletimes.nwsource.com/html/businesstechnology/2003835006_goldmanfund14.html?syndication=rss

[ozymandius]

17. "This is not a rescue," said Goldman Chief Financial Officer David Viniar.

Yeah. Right. Has Mr. Viniar also invested in that bridge in Brooklyn? I hear it's a sure-fire income extravaganza. Or, in other words, why would an investment bank pour more money into one of its own hedge funds at this juncture?

Wouldn't the smart money flow into the fund after it's taken a significant hit, making further acquisition of shares equal to pennies on the dollar?

[mojavekid]

58. Bloomberg: Moody's, S&P Lose Some Credibility With New Credit Derivatives

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aH0mn2YEj6nk

Aug. 14 (Bloomberg) -- Moody's Investors Service and Standard & Poor's, the arbiters of creditworthiness, are losing their credibility in the fastest growing part of the bond market.

The New York-based ratings firms last month gave a new breed of credit derivatives triple-A ratings, indicating they were as safe as U.S. Treasuries. Now, investors are being offered as little as 70 cents on the dollar for the constant proportion debt obligations, securities that use credit-default swaps to speculate that companies with investment-grade ratings will be able to repay their debt.

``The rating doesn't tell me anything,'' said Bas Kragten, who helps manage the equivalent of about $380 billion as head of asset-backed securities at ING Investment Management in The Hague. ``The chance that a CPDO won't be triple-A tomorrow is a lot greater than it is for the government of Germany.''

more...

The last sentence above says it all. The rating agencies are completely crooked in their collusion with their so called "clients"....(partners) And they haven't even got around to downgrading all the crap they gave AAA ratings to in 2005 and 2006...

[ozymandius]

15. Wal-Mart misses view and cuts full-year forecast

NEW YORK (Reuters) - Wal-Mart Stores Inc. (WMT.N), the world's largest retailer, reported a lower-than-expected quarterly profit and cut its full-year earnings forecast on Tuesday, saying its customers remain under economic pressure.

The company's Shares fell 2.5 percent to $45 early electronic composite trading.

Earnings rose to $3.1 billion, or 76 cents per share, in the second quarter ended July 31, from $2.08 billion, or 50 cents per share, a year earlier, when the company took a charge for selling its German stores.

-cut-

But Wal-Mart has been struggling with slowing U.S. sales growth and announced plans earlier this year to cut the number of U.S. supercenters it will open to try to boost sales.

It has also returned to emphasizing its low prices after efforts last year to play down its discount roots backfired with its core low income shoppers.

http://news.yahoo.com/s/nm/20070814/bs_nm/walmart_results_dc

[loudsue]

28. Their "customers remain under economic pressures"????

Could that possibly be because Walmart, almost singlehandedly, sent all their customers' jobs overseas? And the fact that millions of Americans who have bothered to educate themselves on walmart's practices WON'T shop there for any reason?

Duh.

:kick:

[wordpix]

29. agreed. What a whitewash statement

[wordpix]

56. Walmart blames gas, housing, interest rates

http://money.cnn.com/2007/08/14/news/companies/walmart/index.htm?postversion=2007081409

Wal-Mart sees 'challenging quarter'
Says struggles spreading to other markets; blames gas, housing market, interest rates - and its own product mix - for negating benefits of price 'rollbacks.'

By Parija B. Kavilanz, CNNMoney.com senior writer
August 14 2007: 9:02 AM EDT

NEW YORK (CNNMoney.com) -- Wal-Mart has already increased its price "rollbacks" by more than 20 percent this year over last year, but the discount giant is still struggling to get its mostly lower-income consumers to shop a little bit more at its stores.

Worse, the discounter warned Tuesday that the problem is spreading beyond its U.S. stores to some of its international markets, including Mexico and Canada.
walmart_electronics.03.jpg

"We need to improve our underlying performance while we compete with a difficult macro-economic environment in many markets, including the U.S., Mexico and Canada," Wal-Mart Chief Financial Officer Tom Schoewe said in a pre-recorded call to discuss the company's second-quarter results.

Wal-Mart's (Charts, Fortune 500) predicament rattled investors, especially since Wal-Mart's status as the world's largest retailer also makes it a proxy for the health of the consumer.

Its shares slumped more than 4 percent in pre-market trading Tuesday.

For its second quarter, the company posted profits of 76 cents a share, meeting analysts' forecasts on sales that were slightly below what Wall Street was expecting. Sales in the quarter rose 8.8 percent to $91.99 billion versus expectations of sales to reach $92.6 billion.

By another measure, sales at Wal-Mart stores open at least a year, a key gauge of retail performance known as same-store sales, rose 1.9 percent in the quarter.

More importantly, Wal-Mart warned on its full-year profit, saying it now expects profits to be $3.05 to $3.13, down from its earlier guidance of $3.15 to $3.23 a share.

Analysts had expected the retailer to log a profit of $3.15 for the full year.

"This was a challenging quarter. Our underlying performance was not what we had expected of ourselves," Wal-Mart CEO Lee Scott said during the call.

He added that Wal-Mart's merchandise "overall was not where it needs to be."

Although Wal-Mart's grocery, pharmacy and entertainment products sold well during the quarter, which also marked the start of the important back-to-school shopping period, the retailer is still struggling will soft sales in clothing and home-related products.

The back-to-school period is typically the second most-important selling season for retailers after the holiday gift-buying months of November and December.

During the quarter, Wal-Mart slashed prices on thousands of school-related products on hoped of spurring sales and grabbing a bigger chunk of the estimated $18.4 billion dollars that Americans will spend on school products.

Still, Scott said Wal-Mart's core paycheck-to-paycheck consumers were too constrained by economic pressures.

"Their top economic concerns are increased cost of living and gas prices and many customers don't have much money left at the end of the month," Scott said. "We understand the dynamics of our customers and what needs to be done to drive more momentum in the third quarter."

"The one thing that isn't changing is our mission," Scott said. "We will deliver great products at low prices."

Eduardo Castro-Wright, CEO of Wal-Mart Stores U.S.A, echoed Scott's concerns.

"Higher energy, gas and interest rates are all stretching paychecks," Castro-Wright said. The one bright spot, he added, was electronics.

He said Wal-Mart's recent efforts to beef up its offerings of name-brand electronics was paying off. "Our electronics sales were above plan and ahead of last year," he said. "We're also happy with sales of our Dell PCs which we introduced to Wal-Mart and Sam's Club last month." Top of page
Back-to-school sales' mixed grades

[DemReadingDU]

16. Federal Reserve: frequently asked questions

Here are the basic how's and why's of what the Fed has been doing to calm financial markets.


How is this actually done? What are the mechanics of the transactions?

What happens if the bonds used in the repo fall in value overnight?

Does this have any impact on the government’s budget deficit?

If the Fed has $35 billion to help the financial system, why can’t they use some of their money to help the poor?

What is liquidity and why is it so important?

$35 billion seems like quite a bit of money. Is it?

Why did the banks need this money?

I’ve heard that the Fed’s operation had something to do with mortgages. Did it?

Who decides to do this?

Why is this happening now?

Does this have anything to do with discount lending?

The European Central Bank’s operation was much larger than the Fed’s. Is there a reason?


read answers here...
http://www.voxeu.org/index.php?q=node/460

[ozymandius]

18. Stocks head for flat open

NEW YORK - U.S. stocks moved toward a flat open Tuesday after weaker-than-expected quarterly results from Wal-Mart Stores Inc. stirred concerns about whether consumers will keep cutting back their spending.

Investors girding for continued volatility were given a break Monday and stocks finished flat, permitting Wall Street to look past some concerns about tightening credit conditions and examine economic and earnings data. But while investors still awaited readings on inflation and international trade, quarterly earnings reports from Wal-Mart touched off concerns that consumers are being hit harder than some observers had expected.

The world's largest retailer lowered its profit forecast amid weak economic conditions that it blames for hurting consumer spending globally. Major retailers have been reporting largely lackluster sales results for months.

http://news.yahoo.com/s/ap/20070814/ap_on_bi_st_ma_re/wall_street

[ozymandius]

19. pre-open numbers and blather

08:32 am : S&P futures vs fair value: -1.8. Nasdaq futures vs fair value: -4.0. Total PPI rose 0.6% (consensus 0.1%) in July, led by a 2.5% jump in energy prices. The more closely-watched core rate rose just 0.1% (consensus 0.2%), but the year/year rate now stands at 2.3%. The Trade Deficit unexpectedly narrowed in June to $58.1 bln (consensus $61.0 bln). After catching a slight bid heading into the data, the futures market has pulled back and continues to signal a sluggish start for stocks.

08:00 am : S&P futures vs fair value: -1.5. Nasdaq futures vs fair value: -2.8. Early indications are pointing to a slightly lower open for the cash market. As evidenced by the sharp reversal in S&P 500 futures around 6:30 ET, Wal-Mart (WMT) missing expectations and cutting it full-year profit outlook is acting as the biggest overhang this morning.

Fellow Dow component Home Depot (HD) beat forecasts; but a 15% decline in Q2 profits, uncertainty regarding the sale of its supply business and management reiterating a 15-18% drop in its full-year earnings guidance is hardly acting as an offset to Wal-Mart's disappointment.

Investors are also showing some reserve given the Fed's repeatedly hawkish stance and the fact that the latest read on inflation at the wholesale level will hit the wires at 8:30 ET. Economists are expecting just a 0.1% jump in total PPI and another 0.2% increase in the core component.

[spotbird]

20. Stupid question

When the Fed (or any government) infuses cash into financial markets, what do they get for it, other than "stabilizing the market?"

Is is just a gift? Or is it ever repaid (even theoretically)? If it is a gift, can anyone get in on the act? I could certainly use a cash infusion.

On edit:

I just noticed DemReadingDU's post above. I'll check it out, so never mind the above question.

[ozymandius]

22. On the contrary - it's a very good question.

I'm glad you found your answer. But imagine if you hadn't. I had wondered the same when the Fed flooded the markets with liquidity. The scenario reminded me of J.K. Galbraith's book, "Money: Whence it came, where it went". It's worth wondering.

[Hugin]

24. ...

I was listening to the "Young Turks" this morning and they had a guy on about the market to
answer questions and IMHO he did a very poor job doing so...

Came across as just so many current marketplace talking points.

It's all the blab... sub-prime... blab blab blab... no need to worry... blab blab...
keep consuming... blab... it'll be alright... blab...

He didn't get to the crux of the matter at all. No mention of the speculators just blame heaped
upon "Questionable loans given to people who didn't -DESERVE- loans." I had to laugh... And Wall
Street -DESERVES- a bail out?

Anyway, no mention of how people have been taking out home equity loans to finance oil company
gouging.

[spotbird]

36. Well, I'm not sure

I understand yet.

The FAQ explained that it is an infusion of cash which US bonds already held by the institutions used as security (a simplification). Do these institutions really hold that much in reserve bonds? The numbers just don't seem to add up.

I'll check out you're recommend reading. Thanks.

[DemReadingDU]

26. I hope you found your answer

I had several questions too, and the article had quite a bit of helpful information in it, explaining the basics of the Federal Reserve...

http://www.voxeu.org/index.php?q=node/460

[ozymandius]

25. bidness being dealt

9:36
Dow 13,226.45 Down 10.08 (0.08%)
Nasdaq 2,544.74 Up 2.50 (0.10%)
S&P 500 1,454.03 Up 1.11 (0.08%)
10-Yr Bond 4.81% Up 0.032
NYSE Volume 104,281,000
Nasdaq Volume 60,085,000

09:00 am : S&P futures vs fair value: +3.0. Nasdaq futures vs fair value: +3.0. The futures market is now trading near it best levels of the morning, now suggesting the major averages may open on a slightly upbeat note.

Since there is little in the way of any specific news to account for the improved disposition, especially since Wal-Mart (WMT) continues to trend lower into the opening bell (shares are now down 5%), the absence of any news involving hedge fund blowups due to the credit turmoil, and the belief that stocks still look oversold on a short-term basis, appear to be giving bargain hunters another opportunity to jump back in.

[wordpix]

30. Dow's down 10 pts & that's "giving bargain hunters another opportunity to jump back in" ????

[Tandalayo_Scheisskopf]

37. That's a sign...

That they are huffing gold spray paint by the case, at the financial news desk.

[spotbird]

38. Yesterday on CNBC

one of the anchors said it isn't "fair" that stocks are hit because of the subprime crisis.

They must have comedians write their material.

[ozymandius]

41. What part of mortgage backed securities do they NOT understand?

These mortgages are converted into capital market instruments. And we all know that capital, either under the perception of liquidity or truly so, is fungible.

You're right. They must have Ben Stein and Dennis Miller writing their analysis.

[wordpix]

45. question: why are REITs still doing well?

[ozymandius]

50. can't say for sure

I can guess that their health has to do with their investment diversity and for their status as a corporate tax shelter.

[A HERETIC I AM]

55. Because businesses are still making lease payments. Not all REIT's are doing well, however...

American Home Mortgage was/is a Mortgage Real Estate Investment Trust. That's the one that tanked the other day and is now trading at $0.22 (fallen from over $32.00/share in February)

REIT's come in many types and sizes but those that hold income generating real property in their portfolio's (Office buildings, for example) continue to have a solid income stream.

[specimenfred1984]

82. AHM isn't still trading

http://www.nyse.com/press/1186398058343.html

---NYSE to Suspend American Home Mortgage Investment Corp. Moves to Remove from the List

NEW YORK, August 6, 2007 – NYSE Regulation, Inc. (“NYSE Regulation”) announced today that it determined that the common stock of American Home Mortgage Investment Corp. (the “Company”) – ticker symbol AHM – as well as its 9.75% Series A Cumulative Redeemable Preferred Stock – ticker symbol AHM PR A – and its 9.25% Series B Cumulative Redeemable Preferred Stock – ticker symbol AHM PR B – should be suspended immediately.---

[A HERETIC I AM]

83. You are correct! I misspoke A better word would have been "Valued"

as in AHM is now valued at...blah blah blah.
("essentially worthless" would have been a good way of putting it)

Good one Fred. Thanks for catching that.
I hate it when i get something wrong.

You're ok with it being a REIT though, yes?

[BluePatriot]

70. seconded on that question

my dad has some and they are doing OK. He says it has to do with business real estate which is a whole different animal. Who knows. I'd rather he not put his money in them...

[ozymandius]

39. bottom opened up

10:46
Dow 13,149.07 Down 87.46 (0.66%)
Nasdaq 2,526.60 Down 15.64 (0.62%)
S&P 500 1,443.08 Down 9.84 (0.68%)
10-Yr Bond 4.752% Down 0.026
NYSE Volume 855,801,000
Nasdaq Volume 457,526,000

10:30 am : Stocks have taken a turn for the worse over the last 30 minutes. The renewed wave of selling pressure now leaves all 10 sectors in negative territory. Discretionary is now down 1.6%, but a 0.9% decline in Financials removes even more influential leadership.

Tech has turned negative in part from a sell-the-news reaction following the VMware IPO, which has resulted in a 7% swing (from a 4.4% advance to a decline of 2.7%) in shares of EMC (EMC 18.54 -0.51). Adding to the market's recent struggles have been the Dow, S&P 500 and Nasdaq's inability to find support above key technical levels of 13190, 1449, and 2530, respectively. DJ30 -95.02 NASDAQ -13.67 SP500 -10.84 NASDAQ Dec/Adv/Vol 1437/1218/302 mln NYSE Dec/Adv/Vol 1864/1119/252 mln

[wordpix]

42. still plummeting at 10:57 am ET

Intraday Chart
Dow 13,112.00 -124.53
Nasdaq 2,522.36 -19.88
S&P 1,437.51 -15.41
10-Yr Note 100.09 +0.22

10:57 AM ET.

[Roland99]

43. 10:58am - Look out below!

Dow 13,116.23 -120.30
Nasdaq 2,523.52 -18.72
S&P 500 1,437.85 -15.07
10 YR 4.74% -0.04
Oil $71.82 $0.20
Gold $678.80 $-2.10

[wordpix]

47. 11:10---better stop watching these numbers! OUCH!

DJIA
13,069.00 -167.53
NASDAQ
2,514.44 -27.79
S&P 500
1,432.41 -20.51

[Roland99]

40. U.S. banks tightening mortgage standards, Fed says

U.S. banks tightening mortgage standards, Fed says
http://www.marketwatch.com/news/story/trend-tighter-mortgage-standards-continues/story.aspx?guid=%7B52266A3C%2D1D06%2D4BF9%2D8D62%2DB01DA10E3588%7D&dist=morenews

In particular, banks were making it harder for borrowers to get subprime and nontraditional mortgages. But even the borrowers with the best credit were facing tougher standards at some banks.

All told, at least a third of the banks tightened standards for mortgages, about the same percentage that tightened in the April survey. A year ago, banks were loosening credit standards for mortgages.

Although direct comparisions are impossible because the Fed has changed the way it asks the questions, the past two quarters represent the sharpest increase in the number of banks tightening up on mortgage credit since at least 1990-91.

...

Analysts are worried that the market volatility since late July will in turn cause banks to further curtail credit in coming months, endangering a fragile economy.

In the three months ending in July, 56% of the 16 banks that make subprime loans toughened their standards, the Fed found. This was roughly the same percentage that tightened standards in the first quarter.

[wordpix]

44. When they were making billions on the building boom/housing market, the banks didn't need standards

:puke:

[Hugin]

66. The Fed makes it easier for banks to get money and the banks make it harder...

for John Doe to get money? :shrug:

[wordpix]

68. that is the way of banks---take a page from Prescott Bush

and put your money where it's needed most, in the Nazi war machine. :sarcasm: The equivalent today is to rape and pillage the Earth's natural resources, loan billions to the corporations doing so and paying as little for labor as possible, and bundle "trash" hedge fund loans for the investors.

John Doe? Who's he?

[Hugin]

69. John Doe... Is the little guy.

or lady, I was being generic. :)

[Roland99]

78. Thornburg Mortgage delays dividend amid margin calls

Thornburg Mortgage delays dividend amid margin calls
http://www.marketwatch.com/news/story/thornburg-mortgage-delays-dividend-amid/story.aspx?guid=%7BA63917D3%2D3851%2D45F1%2D9B9D%2D86DBF5E16082%7D

SAN FRANCISCO (MarketWatch) -- Thornburg Mortgage Asset Corp. said late Tuesday that it is delaying a dividend payment after getting margin calls and finding it more difficult to fund its mortgage assets in the commercial-paper and asset-backed securities markets. The payment of the company's second-quarter common dividend of 68 cents a share has been rescheduled to Sept. 17. The dividend was originally scheduled to be paid on Aug. 15 to shareholders of record on Aug. 3. By Sept. 17, the company said it will receive its scheduled monthly mortgage payments for August and will have had more opportunity to manage through "this difficult environment."

[Ghost Dog]

46. European stocks drop further along with U.S. shares

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070814:MTFH49393_2007-08-14_14-34-24_L14815721&type=comktNews&rpc=44

PARIS, Aug 14 (Reuters) - European shares added to their losses late on Tuesday following a drop in U.S. stocks, after disappointing results from giant retailers Home Depot (HD.N: Quote, Profile , Research) and Wal-Mart Stores (WMT.N: Quote, Profile , Research) dampened the mood.

At 1428 GMT, the pan-European FTSEurofirst 300 index <.FTEU3> was down 0.63 percent, at 1,503.74.

Swiss bank UBS (UBSN.VX: Quote, Profile , Research) lost nearly 4 percent after it warned market turmoil was likely to hit its investment banking business in the second half.

[wordpix]

Now what are the richies (and we) going to invest in? I say, alternative energy---solar, wind, wave

geothermal and biofuel technology

[AnneD]

60. Actually....

I have been bullish on those for a long time and I put my money where my mouth is. They just make common sense for the future. Oil is on the way out this is the new wave. IMHO-not to be taken as any kind of investment advice.

[wordpix]

agreed, & you can't expect a payoff anytime soon with BushCo still in power

[Ghost Dog]

64. European Stocks Decline

http://www.bloomberg.com/apps/news?pid=20601085&sid=aWNcaDc0TEGw&refer=europe

Aug. 14 (Bloomberg) -- European stocks fell, led by financial-services companies after UBS AG said profit growth may slow and bank shares declined in the U.S. and Asia.

UBS dropped the most in nine months after Europe's largest bank said earnings in the second half may fall if ``turbulent'' market conditions continue. Deutsche Bank AG and Credit Suisse Group paced losses by banks. William Morrison Supermarkets Plc slipped after the food retailer withdrew sliced cold meats from two Scottish stores as health officials investigate a fatal outbreak of e.coli.

The Dow Jones Stoxx 600 Index sank 1.2 percent to 366.34 as all the 18 industry groups dropped except for telecommunications shares. The Stoxx 50 lost 1.5 percent, and the Euro Stoxx 50, a measure for the euro region, decreased 1.4 percent.

``Confidence isn't there, so people aren't rushing out to buy stocks,'' said Salah Seddik, who helps oversee about $5 billion at Richelieu Finance in Paris. ``We haven't yet finished with the subprime questions. We still don't know the extent of losses.''

...

National benchmarks fell in all 18 western European markets except Greece. France's CAC 40 decreased 1.6 percent, and Germany's DAX dropped 0.7 percent. The U.K.'s FTSE 100 slid 1.2 percent.

`Very Volatile'

UBS declined 3.9 percent to 63.50 francs, the biggest drop since Oct. 31. The Swiss bank said credit market turmoil has made forecasting difficult and may cause ``very weak trading results.''

``Markets are currently very volatile, and forecasting is even more difficult than usual,'' the company said in a statement. ``If the current turbulent conditions prevail throughout the quarter, UBS will probably see a very weak trading result in the investment bank, offset by predictable earnings from wealth and asset management.''

Credit Suisse, Switzerland's second-largest bank, decreased 3.2 percent to 80 francs. Deutsche Bank, Germany's biggest bank, sank 2.9 percent to 94.33 euros.

Banco Santander SA fell 1.7 percent to 13.52 euros. Spain's largest bank has 2.2 billion euros ($3 billion) in high-risk loans in the U.S. at its Drive Financial unit, Spanish newspaper Abc reported, citing the lender's annual report.

/...

[UpInArms]

48. US 3rd qtr growth estimates pared back-Philly Fed

http://www.reuters.com/article/bondsNews/idUSN1442726420070814

NEW YORK, Aug 14 (Reuters) - Economic forecasters lowered their estimates for U.S. economic growth in the third quarter, while core inflation will remain steady in the fourth quarter compared with the third quarter, a survey issued by the Philadelphia Federal Reserve Bank showed on Tuesday.

The 49 forecasters surveyed pegged third-quarter growth in U.S. real gross domestic product at an annual rate of 2.5 percent, down from a previous forecast of 2.6 percent.

Fourth quarter GDP is forecast at 2.7 percent versus a previous estimate of 2.9 percent, the Philadelphia Fed said.

Core inflation, as measured by the price index for personal consumption expenditures excluding food and energy, was forecast for the third quarter at an annual rate of 1.9 percent in 2007, down from a previous estimate of 2.1 percent.

Fourth quarter core inflation, on a year-over-year basis, was also seen at 1.9 percent.

The third quarter unemployment rate was seen at 4.6 percent, with fourth quarter unemployment seen at 4.7 percent.

...more...

[Joanne98]

49. Sentinel Woes Weigh on Sentiment

BRIEFING.COM] The market continues to deteriorate as speculation about a letter to clients from a money market fund halting redemptions is confirmed. Within the last 10 minutes, CNBC reported that Sentinel Management Group has asked permission from the CFTC to halt money market redemptions.

Sentinel's inability to meet significant redemption requests has exacerbated the liquidity concerns that have led many to believe a real credit crunch is forthcoming. As a result, the Financial sector has edged even lower and is now down 1.5% to act as the bottom continues to fall out of the brokers and banks.

http://news.briefing.com/GeneralContent/Investor/Active/ArticlePopup/ArticlePopup.aspx?ArticleId=SI20070814110231

[Joanne98]

52. Implode-O- Meter...

http://ml-implode.com/

Top Mortgage Banking Bust News and Commentary:
2007-08-14: No Quick and Easy Fix for This Market - Been walking my mind to an easy time my back turned towards the sun Lord knows when the cold wind blows it'll turn your head aro...
2007-08-14: Credit crunch claims victim in Canada - "The global credit crunch claimed a Canadian victim yesterday, as financing company Coventree Capital Group Inc. saw its stock p...
2007-08-14: "Blood in the water" in Florida property market - "There's a lot of blood in the water and there's a lot more to come,"
2007-08-14: Countrywide lends less than in June, hires more - What is CW doing with all those employees? REOs? Whatever it is, it seems to be squeezing margins.
2007-08-14: Credit Tightens for All Mortgages - "Curtailment like this is bad news for Ronny Satloff Halevi, who is looking to buy a $1 million house in what she calls 'an aver...
2007-08-14: Federal Reserve Finds Banks Tightening Mortgage Lending Standards - "The Fed survey found that even on prime loans, which offer traditional payment options such as 30-year mortgages to borrowers w...
2007-08-14: Coventree Fails to Sell Asset-Backed Commercial Paper - "Coventree Inc., the Canadian finance company that went public in November, failed to sell asset-backed commercial paper to repl...
2007-08-14: Rams Says Credit Markets Threaten Profit; Shares Fall - "Australia's Rams Home Loans Group Ltd. said the shakeout in global debt markets may cut profit, sparking a 19 percent plunge in...
2007-08-14: The Hog is in the Tunnel - What HST would call the credit crunch. The IBs "record profits" part is hilarious... we have been expecting "record" write-down...
2007-08-14: High-risk mortgages turning into toxic mess - No shortage of stories like this these days.
2007-08-14: NMN Erroneously Publishes Regions Mortgage Closure; Doesn't Get Sued - They must have enough money to fight back. Or maybe they still will get sued! Anyway, good thing that we hold news like this f...
2007-08-13: Eliminate The Home Mortgage Interest Deduction? - Homeowners won't like this, but it is effectively a tax on the rest of us, and a barrier to would-be homeowners.
2007-08-13: Eurobanks may take months to reveal subprime woes - "European banks may take months to reveal the full extent of their exposure to risky U.S. subprime mortgages and other asset-bas...
2007-08-13: US a paper tiger, says doomsayer - "The disturbing thing is he's been right so far, .."
2007-08-13: U.S. Homeowner Woes Felt Around World - "We all feel threatened, problems on the stock exchange have consequences for the economy of America and of the world"
2007-08-13: STORM CLOUDS FOR BUILDERS With the tightening mortgage market and a backlog of unsold homes, conditions are bleak - "This is the first recession (in the housing market) that isn't being driven by job losses,"
2007-08-13: International Forecaster August 2007 - "When confidence dissipates so does growth, economies go into reverse and people lose their jobs. We are already into recession ...
2007-08-13: Busted Bonds & Financial Illusions - " Anyone buying anything Wall Street is pumping is likely to regret it."
2007-08-13: Mortgage Backed Securities News from MortgageDaily.com - "Standard & Poor' Ratings Services said it might lower the ratings on $2.2 billion in cash flow and hybrid collateralized debt o...
2007-08-13: Hovnanian Will Take Charge as Home Sales, Prices Fall - "ovnanian Enterprises Inc., New Jersey's largest homebuilder, will take a charge of as much as $110 million in its fiscal third ...
(past news) Quote of the Week:
Conventional thinking has it that had the Fed only created $5 billion and filled the hole in bank capital, the could have been avoided. But the issue at the time wasn't, as conventional monetary economists believe today, the few billions necessary to recapitalize the banking system - but the ongoing tens of billions that would be required to sustain unsustainable Credit Bubble-induced inflated asset prices, inflated corporate profits, inflated earnings, and myriad worsening economic maladjustments.

—Doug Noland, in the July 20th Credit Bubble Bulletin (replace "billion" with "trillion" in the above and you basically have today's situation).

"Imploded" Lenders:
117. Express Capital Lending
116. Deutsche Bank Correspondent Lending Group (CLG)
115. MLSG
114. Trump Mortgage
113. HomeBanc Mortgage Corporation
112. Mylor Financial
111. Aegis (Everything)
110. Alternative Financing Corp (AFC) Wholesale
109. Winstar Mortgage
108. American Home Mortgage / American Brokers Conduit
107. Meridias Capital
106. Fieldstone Mortgage Company
105. Nations Home Lending
104. Wells Fargo Alternative Lending Wholesale
103. Entrust Mortgage
102. Flick Mortgage/Mortgage Simple
101. Alliance Bancorp
100. Choice Capital Funding
99. Premier Mortgage Funding
98. Stone Creek Funding
97. FlexPoint Funding (Wholesale)
96. Starpointe Mortgage
95. Unlimited Loan Resources (ULR)
94. Freestand Financial
93. Steward Financial
92. Wells Fargo (Correspondent)
91. Altivus Financial
90. ACT Mortgage
89. Alliance Mortgage Banking Corp (AMBC)
88. Concord Mortgage Wholesale
87. Heartwell Mortgage
86. Oak Street Mortgage
85. The Mortgage Warehouse
84. First Street Financial
83. Right-Away Mortgage
82. Heritage Plaza Mortgage
81. Horizon Bank Wholesale Lending Group
80. Lancaster Mortgage Bank (LMB)
79. Bryco (Wholesale)
78. No Red Tape Mortgage
77. The Lending Group (TLG)
76. Pro 30 Funding
75. NetBank Funding
74. Columbia Home Loans, LLC
73. Mortgage Tree Lending
72. Homeland Capital Group
71. Nation One Mortgage
70. Dana Capital Group
69. Millenium Funding Group
68. MILA
67. Home Equity of America
66. Opteum (Wholesale, Conduit)
65. Innovative Mortgage Capital
64. Home Capital, Inc.
63. Home 123 Mortgage
62. Homefield Financial
61. First Horizon (Subprime)
60. Platinum Capital Group
59. First Source Funding Group (FSFG)
58. Alterna Mortgage
57. Solutions Funding
56. People's Mortgage
55. LowerMyPayment.com
54. Zone Funding
53. First Consolidated (Subprime Wholesale)
52. EquiFirst
51. SouthStar Funding
50. Warehouse USA
49. H&R Block Mortgage
48. Madison Equity Loans
47. HSBC Mortgage Services (correspondent div.)
46. Sunset Direct Lending
45. Kellner Mortgage Investments
44. LoanCity
43. CoreStar Financial Group
42. Ameriquest
41. Investaid Corp.
40. People's Choice Financial Corp.
39. Master Financial
38. Maribella Mortgage
37. FMF Capital LLC
36. New Century Financial Corp.
35. Wachovia Mortgage (Correspondent div.)
34. Ameritrust Mortgage Company (Subprime Wholesale)
33. Trojan Lending (Wholesale)
32. Fremont General Corporation
31. DomesticBank (Wholesale Lending Division)
30. Franklin Financial (Wholesale Operations)
29. Ivanhoe Mortgage/Central Pacific Mortgage
28. Eagle First Mortgage
27. Coastal Capital
26. Silver State Mortgage
25. ResMAE Mortgage Corporation
24. ECC Capital/Encore Credit
23. Lender's Direct Capital Corporation (wholesale division)
22. Concorde Acceptance
21. DeepGreen Financial
20. Millenium Bankshares (Mortgage Subsidiaries)
19. Summit Mortgage
18. Mandalay Mortgage
17. Rose Mortgage
16. EquiBanc
15. FundingAmerica
14. Popular Financial Holdings
13. Clear Choice Financial/Bay Capital
12. Origen Wholesale Lending
11. SecuredFunding
10. Preferred Advantage
9. MLN
8. Sovereign Bancorp (Wholesale Ops)
7. Harbourton Mortgage Investment Corporation
6. OwnIt Mortgage
5. Sebring Capital Partners
4. Axis Mortgage & Investments
3. Meritage Mortgage
2. Acoustic Home Loans
1. Merit Financial

—> details
Ailing/Watch List Lenders:
14. National City Home Equity
13. NovaStar Mortgage
12. Option One
11. CIT Home Lending
10. FNBA
9. GreenPoint Mortgage
8. All Fund Mortgage
7. Quick Loan Funding
6. Accredited Home Lenders
5. Ocwen Loan Servicing
4. Doral Financial Corp.
3. Evergreen Investment/Carnation Bank
2. Coast Financial Holdings, Inc.
1. Residential Capital, LLC*

—> details

"Imploded" lenders: The "imploded" status is somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or a "firesale" acquisition. The Companies include all types (prime, subprime, or a mix of both; retail or wholesale; subsidiaries and entire companies). Note: Companies listed here may still be operating in some capacity; check with them before making assumptions.

Ailing lenders haven't shut down, but they're significantly scaling back or are (or recently have been) in manifest financial, legal, or operational distress. Unfortunately, most of the industry now falls under this description, so we are forced to reserve this list for the more glaring cases or those which we happen to have more specific info about.

Note: This site changes rapidly. You should always check other sources regarding information found here, and check with the companies themselves if you plan on doing business with them. And as always, please let us know if you have corrections, clarifications, or additions.

"Non-imploded list":
Listed below are companies that wish to express that they are still operating in good health and soliciting business:






...
Want to put your company in this spot? Contact us for pricing!
Latest imploded:
Last addition: August 10, 2007. (All)
Express Capital Lending
Deutsche Bank Correspondent Lending Group (CLG)
MLSG
Trump Mortgage
HomeBanc Mortgage Corporation
http://ml-implode.com/

[ryanus]

57. that cartoon is amazingly accurate

even in the timing of what is falling right now. wow. I am impressed.

[mojavekid]

59. FT: Equity derivatives volumes soar

http://www.ft.com/cms/s/b7a88838-49cb-11dc-9ffe-0000779fd2ac.html

Equity derivatives volumes are surging to daily records as traders scramble to take advantage of or hedge themselves against market turmoil and the resulting spike in volatility.

snip...

The Options Clearing Corporation, which collates the volumes on all the US options exchanges, said that a new daily record was set on July 26 when 21.3m contracts were cleared. Figures for last week are expected to be even higher.

In Europe, combined volumes on Liffe and Eurex, the continent’s two main derivatives exchanges, have risen by 66 per cent since the beginning of July to the end of last week compared with the same period last year. Panic started to grip the markets in early July after Bear Stearns announced the closure of two hedge funds because of more than $20bn in subprime losses

snip...

Traders typically use equity derivatives to protect themselves from volatile markets as they use options to either sell or buy back a single stock or an equity index at a certain price in the future.

Ade Cordell, head of equity derivatives wholesale services at Liffe, said: “When markets are falling, you do need an element of protection. That means more market participants will use equity derivatives to provide that protection with certain option strategies. We have certainly seen a spike in volumes in the past few weeks because of the volatility.”

more...

[mojavekid]

61. Mogombo Guru: Voodoo Bell Curve Curses the Fed

http://www.dailyreckoning.com/Writers/Mogambo/DREssays/MG081307.html

Nassim Nicholas Taleb says that the "central idea" of his book, The Black Swan, is that you can derive a benefit from "the notion of asymmetric outcomes." Suddenly, my ears prick up at attention! A benefit? Great!

He explains it as, "I will never get to know the unknown since, by definition, it is unknown. However, I can always guess how it might affect me, and I should base my decision around that."

In other words, "in order to make a decision you need to focus on the consequences (which you can know) rather than the probability (which you can't know)."

In actual practice, "if my portfolio is exposed to a market crash, the odds of which I can't compute, all I have to do is buy insurance, or get out and invest the amounts I am not willing to ever lose in less risky securities."

In short, one way would be to put the overwhelming majority of your "I must never lose this" assets in the ultra safe category, and use a small bit of your assets going around investing for the Black Swans that will have a huge payoff that is so big that the profit is unbelievably, gloriously disproportionate to the piddly amount invested.

Doug Casey of Casey Research and publisher of the International Speculator newsletter apparently agrees with that, pretty much, and says, "My view is that, certainly in today's world, it's much more prudent to risk 10% of your capital with a prospect of getting a 1,000% return than risk 100% of your capital for the prospect of a 10% (or less) return."

more...

edited to insert credit..!

[Joanne98]

62. Deutsche Bank declines liquidity to Cdn ABS issuer

http://www.reuters.com/article/bondsNews/idUSWNA919220070814
TORONTO, Aug 14 (Reuters) - Trustees for two Canadian trusts, Global Diversified Investment Grade Income Trust (DG_u.TO: Quote, Profile, Research) and MMAI-I Trust, said on Tuesday that MMAI has been unable to issue asset-backed commercial paper or extendible notes to repay maturing commercial paper.

They said MMAI has a short-term liquidity arrangement with Deutsche Bank (DBKGn.DE: Quote, Profile, Research) for market-disruption circumstances, but "after the close of markets on August 13, 2007, Deutsche Bank notified MMAI that it declined to provide the requested liquidity."

The trustees said unitholders of Global Diversified Investment Grade Income Trust are exposed to any losses incurred by MMAI or its creditors, and to any disruption in MMAI's ability to renew or replace maturing short-term debt on a continuous basis.

National Bank Financial, a unit of National Bank of Canada (NA.TO: Quote, Profile, Research), is the financial services agent of MMAI, which is a special purpose vehicle that issues asset-backed commercial paper, extendible commercial paper and floating rate notes.

[mojavekid]

63. Prudent Squirrel: EMERGING MARKETS, COMMODITIES, USD - DELEVERAGING

http://www.financialsense.com/fsu/editorials/laird/2007/0814.html

I just heard a Bloomberg interview with Dr. Marc Faber about the deleveraging in world markets.

One of his main points was that, since 2003 about, many US investors moved significant percentages of their money into emerging markets and commodities. As the US economy sinks into recession, and deleveraging causes stock declines, there will be a lot of US money repatriated.

The implications of this are:

A strengthening USD (or a force for that)
Emerging market stocks will decline faster than US stocks (Faber)
General deleveraging by hedge funds will cause overall stock declines
An interesting comment he made was ‘everybody is a hedge fund’ because investors of all types, corporate finance arms, insurance companies, and so on, all are using high leverage and derivatives. So, what happens to the hedge fund world will happen in a much wider scope to the general financial community.

more...

I will search for the Bloomberg interview with Dr. Faber. Should be worth a listening to....

[Neshanic]

65. They took it down. I listened last night. He said a "colossal recession" comes our way.

Very good explainations. He was amazingly frank about the "trash" that was bundled and being sold.

[mojavekid]

73. Thanks, I am sorry to have missed that one,

Dr Faber is a very intelligent and experienced investor. I have a great respect for his opinions and appreciate his perspective on our economy, from the outside looking in.

What he knows, but cannot say, as it makes you look like a :tinfoilhat: is that we are already in a recession and have been for quite some time - using the real numbers...

-mojavekid

[Roland99]

71. 2:17pm - Still a hurtin'

Dow 13,075.74 -160.79
Nasdaq 2,512.00 -30.24
S&P 500 1,433.84 -19.08
10 YR 4.73% -0.05
Oil $72.28 $0.66
Gold $679.70 $-1.20

[mojavekid]

74. Gold slips as dollar rises, stocks fall

http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-18890124.htm

NEW YORK (AP) - Gold prices dipped Tuesday as a stronger U.S. dollar and a still-volatile stock market prevented traders from making any big bets on precious metals.

Depressing gold and other commodities such as gasoline and copper, the stock market tumbled on weak results from U.S. retailers and ongoing concerns about tightening credit. The stock drop prompted some investors to take money out of risky assets like commodities and put it in government securities -- considered some of the safest assets in times of market uncertainty.

As the Dow Jones industrial average fell more than 100 points, the 10-year Treasury note rose, pushing down its yield to 4.75 percent from 4.78 percent late Monday. The market's volatility continued even after the European Central Bank made another huge infusion of cash into its banking system. The ECB has provided the market with about $288 billion over the past few days, and the Federal Reserve and the Bank of Japan have made similar, albeit smaller, moves.

'The potential iceberg collision may have been averted for the moment, but these remain dangerous waters for the economic and market ships to find themselves in,' wrote Kitco Bullion Dealers analyst Jon Nadler in a note to clients. He noted that gold traders have a 'wait-and-see attitude' right now, as the stock market attempts to find its footing.

Also, gold tends to weaken when the dollar strengthens -- on Tuesday, the U.S. currency rose against both the euro and the pound after the United States said its trade deficit narrowed to a four-month low in June.

December gold fell 80 cents to $680.10 an ounce, while September silver fell 7 cents to $12.785 an ounce. October platinum fell $5.30 to $1,281.80 an ounce.

more....

[nadinbrzezinski]

75. Did we have any funds injected into tthe stock exchange

today, or we are that unstable?

[mojavekid]

76. Not today.....AP: Stocks Slide on Credit, Consumer Worries

http://biz.yahoo.com/ap/070814/wall_street.html?.v=40

NEW YORK (AP) -- Wall Street pulled back sharply Tuesday on anxiety about the pace of consumer spending amid a disappointing outlook from Wal-Mart Stores Inc., and word that a large money market fund was struggling because of weeks of volatility.

snip...

The European Central Bank injected another $10.5 billion into money markets on Tuesday and said conditions were normalizing after several days of volatility. There was no action Tuesday by the Fed.

more...

[Roland99]

77. Closing numbers: Kicked while its down (NASDAQ under 2500, DJIA barely above 13k)

Stocks incur fresh bruising

Dow 13,028.92 -207.61
Nasdaq 2,499.12 -43.12
S&P 500 1,426.54 -26.38
10 YR 4.73% -0.05
Oil $72.38 $0.76
Gold $679.70 $-1.20

[AnneD]

79. So I guess the claims that the stock market...

would end the year above 14000 was about as premature as Bush Sr's son, and just as disappointing.

Another 2,450.68 points and we will be back where we started when he took over. Hey, it can happen-we've almost lost a thousand in less than 3 weeks. I bet we would have lost more without all these 'transfusions' these last few days.

[A HERETIC I AM]

80. It's only August. n/t

[UpInArms]

81. not very optimistic blather

4:20 pm : Stocks tumbled Tuesday as investors got spooked by everything from renewed credit concerns to worries that consumer spending may be slowing even more than initially anticipated. The major averages closed at their lowest levels in about four months.

Reports that Sentinel Management Group may halt redemptions due to significant requests exacerbated concerns that tight credit conditions are spilling over into what are traditionally thought of as one of the "ultimate safe havens" -- money market accounts. As an aside, Wednesday marks the last day for many hedge fund investors to submit redemption requests for the third quarter.

Since liquidity concerns continue to leave many worried that a real credit crunch is forthcoming, the Sentinel news pulled the rug out from under a Financial sector that was finally enjoying a morning without worrisome headlines related to the credit market turmoil. The sector's 2.5% sell-off, though, removed significant leadership and left the sector down more than 12% year-to-date.

The Consumer Discretionary (-2.7%) turned in an even worse performance, as it paced the way among the 10 sectors losing ground. New evidence that suggested the consumer is pulling back on spending took an added toll on sentiment.

Albeit a component in the Consumer Staples sector, Wal-Mart (WMT 43.77 -2.40), the nation's largest retailer, missed analysts' expectations and cut its full-year profit outlook. Fellow Dow component Home Depot (HD 33.50 -1.74) topped Wall Street's forecasts; but Q2 profits plunged 15% and management said it sees housing-market softness extending into 2008.

A couple of positive takeaways that initially helped investors look past the disappointing quarterly results from the two retailers included a tame inflation read (e.g. core-PPI) and huge demand for the biggest IPO since Google debuted three years ago.

Vmware (VMW 51.00 +22.00), which was spun off from EMC Corp (EMC 18.34 -0.71), priced at the high end ($29 a share) of its range and opened up nearly 80% at $52. A sell-the-news reaction, however, weighed on EMC as well as two of VMware's investors.

Tech bellwethers Intel (INTC 23.80 -0.22) and Cisco Systems (CSCO 30.26 -0.57), which own stakes in VMW of 2.5% and 1.6%, respectively, initially surged on the move but also succumbed to a lack of enthusiasm to own anything. Of the 147 S&P industry groups, 143 posted losses.

With the Fed reiterating that inflation remains its "predominant" concern, the Labor Dept. saying that core PPI in July rose just 0.1% was also noteworthy. That followed gains of 0.2% in May and 0.3% in June. However, an already nervous market plagued by credit worries quickly opted to wait for tomorrow's CPI report to get a better inflation read on Fed policy direction. DJ30 -207.61 NASDAQ -43.12 SP500 -26.38 NASDAQ Dec/Adv/Vol 2250/815/1.99 bln NYSE Dec/Adv/Vol 2886/452/1.71 bln

3:30 pm : Buyers are making one final attempt to chip away at the market's broad-based losses; but market internals remain decidedly negative. As reflected in the A/D line, decliners outpace advancers on the NYSE by a nearly 5-to-1 margin while those on the Nasdaq hold a more than 2-to-1 edge.

The outsized ratio of down to up volume further dictates the reluctance on the part of buyers as the resurfacing of new credit worries and concerns about the health of the consumer set the stage for yet another dismal day for market bulls.

At their record closing levels (July 19), the Dow and S&P 500 were up 12.3% and 9.5%, respectively. The Nasdaq at that time was up 12.6%. At their current levels, the S&P 500 is now up only 1.3% on the year while year-to-date gains for the Dow and Nasdaq stand at 5.2% and 4.2%. DJ30 -129.75 NASDAQ -25.33 SP500 -15.69 NASDAQ Dec/Adv/Vol 2130/909/1.59 bln NYSE Dec/Adv/Vol 2772/556/1.38 bln