STOCK MARKET WATCH, Wednesday 5 October

[ozymandius]

Wednesday October 5, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 108 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 289 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 353 DAYS
DAYS SINCE ENRON COLLAPSE = 1410
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
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

AT THE CLOSING BELL ON October 4, 2005

Dow... 10,441.11 -94.37 (-0.90%)
Nasdaq... 2,139.36 -16.07 (-0.75%)
S&P 500... 1,214.47 -12.23 (-1.00%)
10-Yr Bond... 4.38% -0.01 (-0.23%)
Gold future... 469.30 UNCH (UNCH)

GOLD, EURO, YEN, Dollars and Loonie




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 [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[UpInArms]

1. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DXY0

Last trade 89.86 Change -0.24 (-0.27%)

Dollar Initiates Strategic Retrace

http://www.dailyfx.com/index.php?option=com_content&task=view&id=3962&Itemid=39

Dollar is an interesting currency within itself, dollar trading dominates 30% of the overall FX market, and given the latest price action in the market and the retrace which is beginning. This analyst and a trader noticed something interesting, not all of the majors behaving equally as they had during the last stage of the 2000-2005 anti dollar rally, majors are diverging from each other, with antipodeans about to sail south and Canadian dollar will most likely follow the falling oil prices, and as soon as oil breaks below the $60 per mark, Loonie will most likely see the last of 1.2000 handle for sometime.

<snipping charts>

EUR/USD – Euro bulls launched a decisive counter attack against the dollar positions after the single currency longs managed to successfully defend the 2005 low at 1.1879. As the pair temporarily reverses its direction and heads back above the psychologically important 1.2000 handle, a further move to the upside will most likely see the euro bulls push their way toward the 1.2090, a level marked by the September 30 daily high. A break in the dollar defenses will most likely see the single currency longs test the greenback offers around 1.2135, a 20-day SMA, and with sustained momentum heading above the 1.2200 figure. A break above the 1.2200 will most likely see the retrace run its course as momentum stall around 1.2253, a level marked by the 23.6 Fib of the 1.3477-1.1869 USD rally. Indicators are favoring the dollar bulls with both momentum indicator and MACD below the zero line, while extremely oversold Stochastic gives the euro bulls a chance to retaliate.

<snip>

USD/JPY – Japanese Yen longs finally received a much needed break from the attacking greenback bulls as the price action came to a halt around 114.41, a new 2005 high and a gateway toward the psychologically important 115.00 handle. As the price action switches sides, a move to the downside will most likely see the yen longs push their way toward the 113.00 figure in an attempt to test the dollar defenses around 112.62, a level marked by the August 8 daily high. A further break in the dollar defenses will most likely see the yen bulls extend the retrace toward 111.78, a dollar defensive position established by the August 31 daily high, with retrace will most likely running its course around the 111.50 mark. Indicators remain supportive of the dollar longs with both momentum indicator and MACD treading above the zero line, while overbought Stochastic gives the yen longs a chance to retrace part of the dollar rally.

...more...

Tomorrow's Economic Releases: How Hard Did Hurricanes Hit ISM Services?

http://www.dailyfx.com/index.php?option=com_content&task=view&id=3960&Itemid=39

ISM Non-Manufacturing (SEPT)(14:00GMT, 10:00EDT)
Consensus: 59.6
Previous: 65.0

Outlook : Bound on the notion of a disruption in economic activity, consensus expectations remain lower for the non-manufacturing report in the month of September. Although still hovering above the expansionary 50 figure, consensus estimates are now calling for a dip to 59.6, the lowest reading for the year, from the previous 65 reading seen in the previous month. Mostly attributed to expectations of a disruption attributed to the two hurricanes, the prices component is still expected to skyrocket as oil prices remain lofty by 30 percent on the year on year comparison. Subsequently, due to the inner calculations, disruptions in affected areas may be minimized in the figure, confirming the resiliency of the overall economy.

Previous: Rising in the month of August, growth at U.S. service companies rose further above the 50 expansionary level, printing a 65 from July’s 60.5 figure. Suggestive, as has been subsequent economic indicators, the release further bolsters the notion that economic growth prospects remain intact even after both Hurricane’s Katrina and Rita. Additional demand in other industries underpinned strength in the figure even as auto sales dipped along with retailers in the month. New orders rose above previous figures printing a 65.8 while prices paid remained contained at 67.1, dipping below the 70.3 reading in July. Although not as highly anticipated as its manufacturing counterpart, the non-manufacturing report remains suggestive of service growth in the world’s largest economy. However, economists are now expecting a slight disruption in the upcoming month.

...more at link...

[ozymandius]

4. Good morning UIA and everyone!

:donut: :donut: :donut:

I am always amazed at the dollar's value being threatened on two fronts. The euro is up, the yen is down... and vice versa and so on and so forth.

Whoever or whatever does this value juggling act for the dollar is truly amazing.

EDIT: forgot to say: when we see both the yen and euro up against the dollar while stocks slid as much as they did yesterday - somebody took their eyes off the road. Was the PPT at the movies?

[UpInArms]

9. Mornin' Ozy! (and all!)

I think that one of those balls may be filled with lead these days - they are definitely having a difficult time keeping them all up in the air.

Methinks they are spending a bit too much time at the bar :evilgrin:

[AnneD]

44. Morning Marketeers,

:donut: Hi Ozy, 54anickle, et al. I was listening to NPR this am and they were talking about the rigs in the Gulf and the mirade of problems getting them up and running. They also talked about how hard it was to get data reguarding timeline of repairs and estimated costs. It was not encouraging. If it were not for the reserves that are being used, the price at the pump would be even worse.
On a more cheery note, one of my parents is a Sgt. with the NO police dept. He said that the body counts they got was probably accurate. But he said that their needed to be a missings list. They are still draining out the 9th ward and may find more. I think a missing list needs to be done cause that will reflect the true number od those that died. We may never find all the victims. The picrutes he took were some of the most amazing pictures I have ever seen. Made me feel blessed....Happy Hunting, and watch out for the bears...

[54anickel]

33. Gold rides on uncertainty in global markets

High prices suggest erosion of faith in the financial system

http://business-times.asia1.com.sg/sub/news/story/0,4574,171802,00.html?

(NEW YORK) The last time an ounce of gold cost US$470, Alan Greenspan was in his first year as chairman of the Federal Reserve.

Seventeen years later, Mr Greenspan is on the verge of retiring - and the metal finally is back to its late 1980s price level, after a long, long bear market.

The gold-Greenspan convergence is raising suspicions on Wall Street. Some believe the metal's revival must be saying something about the economy the Fed chief is leaving to his as-yet unnamed successor.

The purchase of gold - except in the form of jewellery or collectible coins - often is equated with a rising level of fear among investors. If people are trading their cash for an ancient commodity, it suggests some erosion of faith in the financial system.

Is it inflation that's worrying investors? Or deflation?

more... Check out the picture of Greenspin at the link

[ozymandius]

43. "Hoowee! To think that I fooled so many for so long!"

[UpInArms]

96. Gold futures edge up, trade at session's high

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.5335621528-844890340&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

SAN FRANCISCO (MarketWatch) -- December gold is up 10 cents at $469.40 an ounce in New York. Gold prices found support following the release of the ISM nonmanufacturing index figures, which revealed a decline to 53.3% from 65.0% in August -- the sharpest one-month decline on record. Charles Nedoss, an analyst at Peak Trading Group said the number was "very inflationary" and "the gold market is trading the perception of inflation."

[UpInArms]

107. Gold closes @ $469.30 oz (unchanged)

1:47pm 10/05/05 DEC GOLD CLOSES AT $469.30/OZ, UNCHANGED FOR A SECOND DAY

1:47pm 10/05/05 DEC COPPER ENDS AT A FRESH RECORD, UP 2.05C AT $1.7865/LB

[UpInArms]

56. Dollar losses grow after release of U.S. services data

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.4308004282-844869108&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

CHICAGO (MarketWatch) -- An already-weaker dollar extended losses following the release of a report that showed slower growth for the U.S. service economy. The dollar was at 113.88 yen compared to 113.93 yen before the report. The dollar earlier Wednesday grazed 114.41 yen, its highest since May 2004 before pulling back in a broad correction. The euro stood recently at $1.1953 compared to $1.1936 before the U.S. report.

[54anickel]

143. Signals of the End of the Dollar Standard

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=47223

I am an economist who worked for 25 years in large investment companies in South Africa. I “retired” to the UK a few years ago. For most of my career I lobbied for policies such as money supply targets and later inflation targets that were (implicitly) intended to substitute the role of gold as an independent anchor for the monetary system. I was never an advocate of any form of gold standard, unlike the current Fed Chairman, now ironically testing the fiat money system to destruction.

However, in recent years the scales have fallen from my eyes. As Voltaire said in 1729 “paper money eventually goes down to its intrinsic value – zero.” Every fiat paper currency before or since has confirmed to this prediction. A fiat paper currency that is also the global reserve currency becomes this problem writ large. A US Treasury official of old - Sam Cross - put it this way: “if you postulate a system that depends on one country always following the right policies, you will find that sooner or later no such country exists. The system is eventually going to break down”. In my view the Dollar Standard system is irretrievably breaking down, as signaled by four recent developments described below:

snip>

2. Deflation in Japan is coming to an end. Japan is the biggest foreign holder of US dollars. For example, Japan held $680bn in US Treasury Securities at the end of June - nearly 34% of total foreign holdings. This compares with $291bn held by China (including Hong Kong). Japan will therefore play a critical part in any changes to the world’s currency system.

US-Japan relations are far closer than those between the US and China. Japan also has literally more to lose from the demise of the dollar than China. Nevertheless the same logic that impels China’s move away from US paper applies to Japan. As long as deflation remained the key economic concern in Japan supporting the dollar was the paramount objective of its exchange rate policy. However, there are clear signs of a self-sustaining recovery of domestic employment, investment, and consumption in Japan. The recent election victory of PM Koizumi should reinforce reform and recovery. These forces are simultaneously bringing an end to both the deflationary process and to dependence on exports for growth. The imperative to support the dollar will erode and interest rates in Japan will begin to normalize. Another straw in the wind - Japan did not increase its holdings of US Treasuries in the first half of 2005.

3. The US in effect now has to borrow abroad in order to service all its foreign debt. The remarkable down spiral in the US foreign financial position took another crucial but little noticed twist recently. In the second quarter of 2005 the US paid out more in income to foreigners on their US assets than it received in income on its foreign assets. Technically net foreign investment income went negative. No comfort should be taken from the fact the second quarter investment income deficit was a mere $0.5bn. The income deficit will deteriorate rapidly in coming years. The US has net foreign debt (foreign liabilities minus foreign assets) of more than $ 2.5 trillion, and this debt will grow rapidly as the US continues to rack up huge current account deficits (now roughly $800bn annually). The income deficit on this debt has only just gone negative because the US receives a rate of return on its foreign assets roughly double that of overseas investors in the US - about 7% versus 3.4% between 2002 and 2004.

more...

[ozymandius]

2. WrapUp by Ike Iossif - WEEKLY CHARTS

Summary

Last week we said, "The indices fell early on in the week in anticipation of wide destruction from hurricane Rita. Fortunately it did not happen. Consequently, next week the odds favor a "relief" rally which ought to take the indices back up to resistance. If resistance is overcome, we could get new marginal highs."

Currently, the "relief rally" we talked about last week finally came on Thursday. Does it have any staying power? Notice that the Quantifiers haven't turned positive, and the McClellan Oscillators haven't overcome the 25 level. However, both are rising. The implication is that there is more room to the upside, but it is too early to assume that the "relief rally" is going to last. In fact, given the data that we have now, the odds favor an early termination.

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

[UpInArms]

3. Today's Reports:

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

Oct 5	10:00 AM	ISM Services		Sep	-	60.0	60.0	65.0	-	
Oct 5	10:30 AM	Crude Inventories	-	-	-	-	-	-

[ozymandius]

5. Oil traders tread carefully ahead of US data

Oil futures speculators treaded carefully on Wednesday ahead of the weekly US inventory data, which was expected to give a clear assessment of supply in the wake of hurricanes Katrina and Rita.

Although few strategists were willing to forecast the inventory data, all expected drawdowns in stocks of refined products, which will be the key driver of prices after the data is released on Wednesday.

Added to this, much of the oil production in the Gulf of Mexico remained shut on Wednesday, accounting for nearly a third of total US production.

more

[UpInArms]

63. Oopsie! DOE Inventory Report is in:

10:32am 10/05/05 U.S. CRUDE STKS DOWN 300,000 BRLS LAST WEEK: ENERGY DEPT

10:32am 10/05/05 U.S. GASOLINE STKS DOWN 4.3 MLN BRLS: ENERGY DEPT

10:32am 10/05/05 U.S. DISTILLATE STKS DOWN 5.6 MLN BRLS: ENERGY DEPT

[ozymandius]

67. Thanks. This is hot off the presses.

I was looking for this a few minutes ago. Nothing surprising here.

BTW - it has occurred to me to ask, however informally, how gas stations in everyone's respective areas are doing. There are several around our suburban Atlanta area that are out of gas 2-3 days per week each.

Stocks cannot be too plentiful if this is a regular occurrence.

[54anickel]

90. Haven't had any running out here in SE WI - no price changes since

last Thursday that I've noticed either - but I mainly just see the local stations in my community - haven't done a lot of driving around lately.

[AnneD]

93. of course,

everyone fleeing Rita totally took all our gas and it was 3-4 days to get gas stations stocked. The price before Rita was $1.69. The price now is $1.89-$1.95. However, gas can be had with a Citco prepaid card discount for $1.79 (love those Venzualans). No shortages yet-but traffic is not what it has been. You can't give away an SUV here, but I still see trucks. With our tendency to flooding, it is hard to give up those high profile vehicles. If it is a 2 car family, one vehicle is high profile.

[UpInArms]

95. no shortage - but gas in NW Missouri is $2.85 gal .....eom

[54anickel]

140. That's a bargain!!! We're at $3.12, of course we have that reformulated

stuff here and our fule taxes are pretty high.

[UpInArms]

70. Crude stocks fell 4.2 mln barrels: API

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.4457964931-844872309&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- The American Petroleum Institute said crude inventories fell by 4.2 million barrels for the week ended Sept. 30. The government data showed a 300,000-barrel decline. Motor gasoline inventories dropped 4.8 million barrels. Distillate stocks were down 4.9 million barrels, the API said.

[UpInArms]

47. HORRIBLE ISM Report - 53.3% (down from 65.0 in Aug)

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.4208084375-844867066&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- Nonmanufacturing sectors of the U.S. economy expanded at a slower pace during September, the Institute for Supply Management reported Wednesday. The ISM nonmanufacturing index fell to 53.3% from 65.0% in August. This is the lowest level since April 2003. The drop was sharper than expected. Economists were looking the index to slip to 60.3%. New orders fell to 56.6% from 65.8%. The price index rose to a record 81.4% from 67.1%.

10:01am 10/05/05 U.S. SEPT. ISM SERVICES NEW ORDERS 56.6% VS 65.8% IN AUG.

10:01am 10/05/05 U.S. SEPT. ISM SERVICES PRICES 81.4% VS 67.1% IN AUG.

10:00am 10/05/05 NOV NATURAL GAS CLIMBS 14.6C TO $14.37/MLN BTUS

10:00am 10/05/05 U.S. SEPT. ISM SERVICES BELOW CONSENSUS 60.3%

10:00am 10/05/05 U.S. SEPT. ISM SERVICES 53.3% VS 65.0% IN AUG.

[UpInArms]

55. Economic Report: U.S. service sector hit hard by Katrina

http://www.marketwatch.com/news/story.asp?guid=%7BC99554F4%2D3FAB%2D43DF%2DA37D%2D59FF64A18489%7D&siteid=mktw

WASHINGTON (MarketWatch) - There was a broad-based moderation in the service sector economy in the aftermath of Hurricane Katrina, the Institute for Supply Management reported Wednesday.

The ISM nonmanufacturing index fell to 53.3% from 65.0% in August. This is the sharpest one-month decline since shortly after 9/11, said Ralph Kauffman, chair of the ISM non-manufacturing survey committee.

This is the lowest level since April 2003. Read full survey.

The drop was sharper than expected. Economists polled by Marketwatch expected the index to slip to 60.3 percent. See Economic Calendar.

...more...

[UpInArms]

72. ISM representing "about" 80% of US economy - took a dive in Sept

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T140929Z_01_N05283220_RTRIDST_0_ECONOMY-SERVICES-URGENT-REPEAT.XML

NEW YORK, Oct 5 (Reuters) - Growth in the U.S. services
sector slowed sharply in September, falling shy of expectations
for faster expansion, an industry survey showed on Wednesday.

The Institute for Supply Management's services index fell
to 53.3 in September, from 65.0 in August, falling well short
of Wall Street's median forecast for a drop to 61.0.

A number above 50 indicates growth in the sector.

The services sector constitutes about 80 percent of the
U.S. economy, and includes diverse areas such as hair salons,
restaurants, hotels and airlines.

...more...

[UpInArms]

110. US services sector hurt by spiralling prices (just say the damn word:

inflation

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T161035Z_01_N05730548_RTRIDST_0_ECONOMY-WRAPUP-1.XML

CHICAGO, Oct 5 (Reuters) - A measure of the vast U.S. services economy slumped in September as high gasoline prices sapped consumer demand and hurricanes caused dislocations to some businesses, a report showed on Wednesday.

Separately, weekly U.S. home mortgage applications slipped as interest rates on the key 30-year mortgage climbed to a seven-month high.

The reports suggested at least temporary weakness in the economy at a time the Federal Reserve seems determined to keep raising interest rates to fend off higher inflation.

The Institute for Supply Management's U.S. services index fell to 53.3 in September from 65.0, far below Wall Street's forecast of 61.0 and the lowest since April 2003. A reading over 50 still shows expansion.

New orders, exports orders and employment in the services sector all fell in September.

"It does suggest that gross domestic product may be on the soft side in the third and fourth quarters," said Ian Morris, chief U.S. economist at HSBC Securities.

...more...

[cosmicdot]

129. Why is the Purchasing Managers Index at 59.4?

The PMI is, not only relatively high, but up from August's 53.6. Plus, it's the highest it has been since August 2004 when it started to drop.

... considering the state of the overall economy, are the feeding of military contracts and other Bu$hCo profiteering boondoggles to corporate america enough to affect the PMI this much?

http://www.ism.ws/ISMReport/PMIndex.cfm
http://www.ism.ws/ISMReport/OverviewofPMI.cfm


Economy Gets Another Inflation Warning

October 05, 2005 1:38 PM EDT

NEW YORK - The economy received another inflation warning on Wednesday, when a survey of industry executives showed that energy costs drove prices higher in September while business activity slowed in the services sector. The report reinforced expectations that the Federal Reserve would continue to raise rates as the economy struggles with rising fuel costs aggravated by Hurricane Katrina.

The Institute of Supply Management, which conducted the survey, said its non-manufacturing business activity index was at 53.3 percent in September, down from August's reading of 65 percent. The group's index of prices paid rose 14.3 points to 81.4 percent, the highest level and the biggest jump for the index in the eight-year history of the report.

~snip~

"It is troubling to see so many more purchasing managers, manufacturing and non-manufacturing, paying higher prices to their vendors," said Johnson. "It suggests that the Federal Reserve is faced with an economy which is weaker and inflation which is stronger. That is not a particularly good configuration."

[cosmicdot]

130. duplicate post

sorry

[ozymandius]

6. Oil Prices Flat Ahead of Supply Report

VIENNA, Austria - Oil futures were flat Wednesday after falling more than a dollar per barrel a day earlier on concern that high prices were hurting demand.

But analysts expected prices to rise later in the day following the release of U.S. data reflecting recent declines in crude stockpiles and worries remaining about refinery capacity.

-cut-

Traders closely monitored natural-gas futures, which closed at a record high Tuesday for a front month after the U.S. Minerals Management Service said 72 percent of Gulf gas production remained shut in.

more

[UpInArms]

13. Storms destroyed 108 offshore platforms

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-10-04T201908Z_01_MOR465057_RTRUKOC_0_US-HURRICANES-ENERGY-INTERIOR.xml

WASHINGTON (Reuters) - A total of 108 low producing oil and natural gas offshore platforms were destroyed by hurricanes Rita and Katrina and some of the other 53 heavily damaged platforms could be offline until next year, the U.S. Interior Department said on Tuesday.

The destroyed platforms likely will not be rebuilt, Interior Secretary Gale Norton told reporters, adding that repairing damage elsewhere would run into the "billions of dollars."

In a briefing on the damage done by the hurricanes, the department also said that 90 percent of crude oil production in the Gulf of Mexico is still shut-in and 72 percent of offshore natural gas production is still offline.

Norton said the destroyed platforms account for about 1.7 percent of oil output in the Gulf of Mexico and 0.9 percent of natural gas production.

Repairs to platforms with major damage could run into next year, while restaffing unmanned rigs that escaped damage so they can operate again could take another 10 days, she said.

"Major repairs may take months and some facilities into next year," Norton told reporters. Some 50 platforms were damaged by the two hurricanes.

...more...

[ozymandius]

34. Oil steadies after $2 drop

LONDON (Reuters) - Oil steadied near $64 on Wednesday after losing more than $2 a barrel this week as investors grew more convinced high energy bills were crimping consumption and Washington offered to tap emergency reserves.

But some analysts argued demand for oil remained strong and that a bull-run could resume as tight supplies of winter fuel are threatened by the closure of hurricane-battered U.S. refineries and strikes by oil workers in France.

U.S. crude oil was up four cents at $63.94 by 1200 GMT, after falling $1.57 on Tuesday. London Brent crude was up 22 cents at $61.44.

"The expectation that the rate of demand destruction will outpace that of supply increase or recovery in the offshore (U.S.) Gulf continues to weigh on energy prices, though the market certainly isn't immune to further supply shocks," said analysts at Refco.

more

[UpInArms]

68. Nov NatGas @ $14.66 mln btus (another new record)

10:37am 10/05/05 NOV NATGAS FUTURES HIT NEW RECORD AT $14.66 PER MILLION BTUS

[UpInArms]

85. Natural gas rises to uncharted territory

http://www.marketwatch.com/news/story.asp?guid=%7B3FCECB3E%2D7909%2D4306%2D9459%2D683D0851D985%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Natural-gas futures rallied into uncharted territory near $15 per million British thermal units Wednesday as the bulk of production facilities in the Gulf of Mexico remained shutdown, feeding worries about adequate winter heating-fuel supplies.

Across-the-board declines in U.S. petroleum inventories failed to provide much support for the oil complex on the heels of weaker demand for oil products. Drops in distillate and motor-gasoline supplies, however, were larger than most expected.

Natural-gas futures traded as high as $14.75 per million British thermal units on the New York Mercantile Exchange, surpassing the previous intraday record of $14.55 from Sept. 29. The contract was last at up 24.6 cents, or 2.4%, at $14.57.

"Productive gas assets have suffered as much or perhaps even more damage than the rest of the complex," said John Kilduff, an analyst at Fimat USA.

About 71.7% of daily natural-gas output in the Gulf of Mexico was offline as of Tuesday in the wake of Hurricanes Katrina and Rita, according to the U.S. Minerals Management Service.

<snip>

Natural-gas prices at the current levels "show that the market remains unconvinced" that supplies will reach adequate levels, said Kilduff.

"A harsh winter, begun with less than optimal storage could drive prices well past $15," he warned.

...more...

[ozymandius]

7. Forecasters thinking recession could be coming

WASHINGTON - Economic forecasters and Wall Street analysts are quietly hedging their bets after months of rosy reports about a vibrant U.S. economic outlook. They're now mentioning the growing possibility of recession ahead.

Why? Soaring gasoline prices, nightmarish home-heating costs this winter, plunging consumer confidence, rising interest rates and falling new-home sales.

Similar energy-price spikes, rising interest rates and housing slowdowns played important roles in past recessions. While most forecasters caution that recession remains unlikely, they nevertheless are dusting off the R-word, which almost all of them brushed aside before hurricanes Katrina and Rita.

-cut-

(Ed Yardeni says) "The U.S. economy has been remarkably resilient in recent years, but consumers may start to postpone discretionary spending to build some cushion to pay their higher heating bills on top of paying more to fill up their gasoline tanks," he wrote to investors this week. "In other words, I am not sure that the economy is resilient enough to withstand the one-two punches from the Katrina/Rita tag team."

more

[UpInArms]

8. After the Bell yesterday:

4:14pm 10/04/05 La-Z-Boy: Results may be adversely impacted beyond Q2 - MarketWatch.com

4:13pm 10/04/05 La-Z-Boy: Q2 results to see 'significant adverse impact' - MarketWatch.com

4:12pm 10/04/05 La-Z-Boy: Supply issue, retail environment to impact earns - MarketWatch.com

4:10pm 10/04/05 La-Z-Boy: Supplier warns of lack of chemical availability - MarketWatch.com

4:08pm 10/04/05 La-Z-Boy shares halted in after-hours session - MarketWatch.com

La-Z-Boy Faces Supply Chain Issue

http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=2810&guid=%7BBF344A3F%2DD499%2D46AC%2DBE22%2D5412EF315CD9%7D&symb=

MONROE, Mich., Oct 04, 2005 /PRNewswire-FirstCall via COMTEX/ -- La-Z-Boy Incorporated (LZB) today announced that one of its key suppliers of polyurethane foam has put its customers, including La-Z-Boy, on notice of allocation, due to the lack of availability of TDI (toluene diisocyanate), a key chemical component of polyurethane foam which is used throughout the upholstery and bedding industry. The company also said that this situation, coupled with the continued soft retail environment and damage to one of its plants by a tornado spawned from Hurricane Rita, will have a significant adverse impact on its results for the fiscal 2006 second quarter and potentially beyond.

<snip>

Darrow continued, "Additionally, our plywood parts cutting facility in Newton, Mississippi which manufactures frame parts for our La-Z-Boy Residential upholstery operations, sustained severe structural damage from a tornado related to Hurricane Rita. We were prepared and executed our disaster contingency plans in order to meet our production needs and quickly shifted production to several of our other facilities and outside suppliers, although we are not operating at our normal levels of efficiency or cost effectiveness."

Darrow concluded, "Given these disruptive events and the continued softness at the retail level, we will significantly miss our estimates for sales and earnings for the second quarter, although at this point, it is not readily quantifiable. We intend to provide an update on our second fiscal quarter guidance prior to the beginning of the International Home Furnishings Market the week of October 17, 2005."

...more...

[UpInArms]

10. Fed's Poole says Fannie Mae solvency not at risk

(protesting too much?)

http://today.reuters.com/investing/financeArticle.aspx?type=governmentFilingsNews&storyID=URI:urn:newsml:reuters.com:20051004:MTFH19842_2005-10-04_21-54-54_WAT004110:1

SEATTLE, Oct 4 Reuters) - A top Federal Reserve official said on Tuesday that a report of accountancy problems at Fannie Mae would not shake its core business, but underlined the case for reforming all such government-sponsored enterprises.

"I don't see anything in these reports that suggests a solvency issue," St Louis Federal Reserve Bank President William Poole told reporters after making a speech.

Shares in Fannie Mae plunged last week after a report saying investigators found new accounting violations at the mortgage finance enterprise, which is already under scrutiny for bookkeeping distortions.

A spokeswoman for the Office of Federal Housing Enterprise Oversight, which oversees Fannie Mae's financial soundness, would not confirm or deny last Wednesday a Dow Jones report that extensive additional problems had been found.

<snip>

"These firms create a continuing systemic risk to the economy, ... The scale is so immense," said Poole.

...more at link...

[54anickel]

32. Fannie Ex-Execs Want Suit Dropped-Lack of 'Direct Evidence' Cited

http://www.washingtonpost.com/wp-dyn/content/article/2005/10/04/AR2005100401713.html

Former Fannie Mae chief executive Franklin D. Raines and former chief financial officer J. Timothy Howard have asked a federal judge to dismiss a shareholder lawsuit against them on the grounds that the plaintiffs have not produced any "direct evidence" that Raines and Howard knew about the company's accounting problems or intended to deceive investors, according to pretrial motions filed over the summer.

The pleadings, filed jointly by the two executives, represent the most public defense Raines and Howard have offered since they were forced from Fannie Mae last year amid allegations that they flouted accounting rules to boost earnings, which in turn triggered millions of dollars in bonuses for themselves and other top executives.

Attorneys for Raines and Howard disputed the claim that they were motivated by the lure of bonus checks and stock options, saying their compensation was not tied to reported earnings but to an alternate measure of profitability. The plaintiffs countered that the accounting violations affect that statistic as well.

Raines's and Howard's lawyers also took issue with the allegation that the two former executives knew of and disregarded a September 2002 memo from Roger L. Barnes, then a manager in Fannie Mae's controller's division, that warned of "serious financial improprieties." They contended in the court filings that his claims were thoroughly investigated and largely had to do with accounting issues other than the ones that have called into question as much as $10.8 billion in previously reported earnings.

more...

[UpInArms]

36. Here's Raines compensation:

http://swz.salary.com/execcomp/layouthtmls/excl_execreport_106458.html

Franklin D. Raines
Chairman of the Board and Chief Executive Officer
FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE (FNM)

Compensation

Base Pay $992,250

Bonus $4,180,365

Restricted Stock $0

LTIP Payouts $11,621,280

Present Value of Option Grants $3,006,895

Other Annual Compensation $237,246

All Other Compensation $25,501

Total Compensation $20,063,537

Stock Option Exercises and Cumulative Balances

Shares Aquired on Exercise (#) 0

Value Realized for Options Exercised $0

Remaining Exercisable (vested) Options (#) 1,215,304

Remaining Unexercisable (non-vested) Options (#) 715,900

Value of Remaining Exercisable Options $7,448,575

Value of Remaining Unexercisable Options $4,437,208

Data for fiscal year ended in 2003

and here is a bit more info:

False Signatures Aided Fannie Mae Bonuses, Falcon Says

http://www.washingtonpost.com/wp-dyn/articles/A32845-2005Apr6.html

Fannie Mae employees falsified signatures on accounting transactions that helped the company meet earnings targets for 1998, a "manipulation" that triggered multimillion-dollar bonuses for top executives, a federal regulator said yesterday.

Armando Falcon Jr., director of the Office of Federal Housing Enterprise Oversight, said the entries were related to the movement of $200 million in expenses from 1998 to later periods. The result of the changes was an increase in Fannie Mae's 1998 earnings per share and the release of a $27.1 million bonus pool for senior executives.

Fannie Mae reported paying the following executive bonuses in 1998: chairman and chief executive James A. Johnson received $1.932 million; Franklin D. Raines, chairman-designate, received $1.11 million; Chief Operating Officer Lawrence M. Small received $1.108 million; Vice Chairman Jamie S. Gorelick received $779,625; Chief Financial Officer J. Timothy Howard received $493,750; and Robert J. Levin, an executive vice president, received $493,750.

Raines and Howard were ousted by the Fannie Mae board in December after the chief accountant of the Securities and Exchange Commission agreed with OFHEO's criticism of the company's accounting, including the 1998 bonus maneuver. He directed the company to correct financial statements, a move that could wipe out $9 billion in reported profit dating to 2001.

...more...

[54anickel]

40. Heh-heh, but there's no DIRECT evidence they intentionally cooked

the books, that had to be forged, to meet the targets, that gave them the bonuses, that went into the mansion that Jack built. :crazy:

Sounds sort of like Delay's train of thought.

[54anickel]

46. Poole Calls 50BP More on Fed Rate by Year-End `Reasonable'

http://www.bloomberg.com/apps/news?pid=10000103&sid=aJL0RtjeQ6D4&refer=us

Oct. 4 (Bloomberg) -- Futures-market predictions that the Federal Reserve will raise its target interest rate by a half- percentage point over two remaining meetings this year are ``reasonable,'' St. Louis Fed Bank President William Poole said.

``I have great respect for the markets,'' Poole said in an interview with Bloomberg News after a speech in Seattle. ``I think that the market's expectation is reasonable. That is not the same thing as saying we have a commitment to produce exactly that outcome.''

Today's comments by Poole and Richard Fisher, his counterpart at the Dallas Fed, suggest central bankers are more concerned about the risk of rising inflation than weakening growth after a 28 percent rise in crude oil prices over 12 months and Hurricanes Katrina and Rita. Inflation ``is at the upper end of the Fed's tolerance zone,'' Fisher said in a speech in Dallas.

Investors are predicting the Fed will keep raising its benchmark overnight lending after 11 straight increases since June 2004 to today's 3.75 percent. Federal funds futures contracts show traders see a 100 percent probability the Fed will raise the rate again Nov. 1 and a 78 percent chance of another increase on Dec. 13. That would lift the rate by 50 basis points, to 4.25 percent, by year-end.

snip>

Fisher warned that lawmakers must rein in spending or risk losing the flexibility that makes the U.S. competitive in a global economy. He said the Fed will not rescue the government from rising debt by allowing inflation to take off.

``As a member of the FOMC, I will never vote to monetize fiscal profligacy,'' Fisher said.

[UpInArms]

122. Uncertainty haunts Fannie shares

http://www.marketwatch.com/news/story.asp?guid=%7BEB52C097%2DEF5B%2D46AE%2DAC00%2DC5004B28688C%7D&siteid=mktw

WASHINGTON (MarketWatch) - Shares of Freddie Mac surged Wednesday after the company said it's buying back up to $2 billion of its own stock, but its sister mortgage company Fannie Mae continued to slump as any picture of ots financial condition remained murky.

For Fannie (FNM: news, chart, profile) , whose stock fell 23% in the third quarter alone, it was another declining day, with shares falling 1.5% to $41.76. The firm's shares started the third quarter at $58.62.

<snip>

For Fannie stock to come back to life, analysts said the company needs a dose of certainty about its future. That includes regular financial reporting-a timeline not planned at the moment-a deal in Congress about a new regulator for Fannie and Freddie (FRE: news, chart, profile) and the issuing of a report about Fannie's bookkeeping by former Sen. Warren Rudman.

But for now, "what's not known is what ends up moving them," said Ken Posner of Morgan Stanley.

There's a lot investors who don't know about Fannie Mae right now, chiefly how its earnings are performing. The company doesn't plan to begin stating earnings until it restates prior earnings back to 2001. That could take until the second half of 2006, CEO Daniel Mudd said in August.

...more...

[UpInArms]

11. Freddie Mac estimates up to $300 mln storm losses

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=URI:urn:newsml:reuters.com:20051004:MTFH20243_2005-10-04_22-20-46_N04531379:1

NEW YORK, Oct 4 (Reuters) - Freddie Mac (FRE.N: Quote, Profile, Research) estimated after-tax losses of $150 million to $300 million for the third quarter as a result of Hurricanes Katrina and Rita, the U.S. mortgage finance giant said on Tuesday.

The company expects the losses to stem from its guarantee of timely payment of principal and interest on mortgage-backed securities, and its holding of loans backed by homes devastated by the two powerful storms that hammered parts of the U.S. Gulf Coast, Freddie Mac said in a statement.

[UpInArms]

12. Santomero: Hurricanes mean slower growth, higher inflation

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38629.7920929282-844754542&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- The two hurricanes that slammed into the Gulf Coast region will inevitably mean slower growth and higher inflation for the next 18 months, said Anthony Santomero, the president of the Philadelphia Federal Reserve Bank. The slower growth will not persist, Santomero said in a speech prepared for delivery at Lycoming College. The impact on inflation must be watched carefully, he said. More rate hikes are needed to keep a "transitory" rise in energy prices from permanently disrupting the price environment, he said.

7:00pm 10/04/05 SANTOMERO: STORM PRICE IMPACT NEEDS CAREFUL MONITORING

7:00pm 10/04/05 SANTOMERO: SLOWDOWN FROM HURRICANES WON'T PERSIST

7:00pm 10/04/05 SANTOMERO: MORE RATE HIKES NEEDED TO COMBAT INFLATION

7:00pm 10/04/05 SANTOMERO: HURRICANES MEAN LESS GROWTH, HIGHER PRICES

7:00pm 10/04/05 FED'S SANTOMERO: FED RATE STANCE 'SOMEWHAT ACCOMMODATIVE'

[UpInArms]

14. Boeing's deliveries scraped 10-year low

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-10-04T202238Z_01_MOR456605_RTRUKOC_0_US-TRANSPORT-BOEING.xml

NEW YORK (Reuters) - Boeing Co. (BA.N: Quote, Profile, Research) deliveries of commercial aircraft slumped to a ten-year low in its strike-hindered third quarter, the No. 1 U.S. aerospace company said on Tuesday.

Third-quarter deliveries to airlines and lessors, at 62, were down by 23 from the second quarter and by 5 from the year-earlier period. The previous low quarter was the third quarter of 1995, when it was also 62.

A nearly month-long walkout by 18,500 workers at Boeing's plants in the states of Washington, Oregon and Kansas ended last week and analysts have said they are hopeful the company will be able to make up for the lost deliveries in September.

Boeing's deliveries for the year through September stood at 217, behind the 271 total reported on Tuesday by European archrival Airbus (EAD.PA: Quote, Profile, Research).

...more...

[UpInArms]

15. TXU seeks Texas power rate hike; cites natgas

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-04T232119Z_01_N04423758_RTRIDST_0_UTILITIES-TXU-RATES.XML

NEW YORK, Oct 4 (Reuters) - Customers of TXU Energy, the competitive retail electricity business of TXU Corp. (TXU.N: Quote, Profile, Research), would see rates rise about 12 percent, or $15 on the average monthly bill, under a request filed with state regulators that the company announced on Tuesday.

After Hurricane Katrina pummelled the Gulf Coast, TXU Energy held back on a rate hike to reflect higher fuel costs. The company said it has filed the request to boost its "Price to Beat" electricity rates with the Public Utility Commission of Texas (PUC).

The filing is part of an agreement reached in September with the PUC Staff and the Office of Public Utility Counsel to moderate the effect of higher prices for natural gas and other fuel through the end of the year, the company said.

TXU said the agreement provides that if the PUC approves the filing no later than its meeting on Oct. 28, upon implementation of the new price to beat, TXU Energy will give a discount for all customers in the "price to beat" program.

This discount will result in a rate equal to a price to beat based on natural gas prices in the week prior to Hurricane Katrina making landfall in New Orleans, or $9.743 per million British thermal units (mmBtu).

TXU said this plan will provide customers savings totaling about $70 million in 2005. The discount will expire on Dec. 31, when the rate will rise, if the company's request is approved by the PUC.

...more...

I love how they "explain" how much money they are going to save the ratepayers when they ask for a price hike :crazy:

[UpInArms]

84. Hurricanes to bring $690 winter gas bills to Texas

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T152051Z_01_N052063_RTRIDST_0_UTILITIES-ATMOS.XML

NEW YORK, Oct 5 (Reuters) - After hitting prices at the gas pump, Hurricanes Katrina and Rita's next punch on consumers' wallet will likely be from home heating gas bills this winter.

Due to soaring natural gas prices, the average customer in North Central Texas can expect to pay $690 for their gas bill from October through March, nearly double last season's average cost of $367, Atmos Energy Corp. (ATO.N: Quote, Profile, Research) said on Wednesday.

The two hurricanes disrupted about 15 percent of U.S. natural gas production, which was already constrained because of growing demands from power plants and other users, the Dallas-based natural gas distributor said.

"Volatility of gas prices in recent months has been like a giant roller coaster," Dick Erskine, president of Atmos Energy's Mid-Tex division said. "We have never seen gas prices change so fast, making it harder to predict our winter bills."

Overall, natural gas utility bills for the average North Central Texas residential customer could be about 60 to 90 percent higher than gas bills last winter, Atmos said.

...more...

[UpInArms]

16. GM shedding Japanese asset

Toyota to buy 8.7 pct in Fuji Heavy

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-10-05T100517Z_01_MAR535948_RTRUKOC_0_US-AUTOS-TOYOTA-FUJIHEAVY-GM.xml

TOKYO (Reuters) - Fuji Heavy Industries Ltd. (7270.T: Quote, Profile, Research) said on Wednesday it will dissolve its alliance with General Motors Corp. (GM.N: Quote, Profile, Research), and that Toyota Motor Corp. (7203.T: Quote, Profile, Research) will buy an 8.7 percent stake in the Subaru maker from the struggling U.S. car giant.

GM will sell its remaining 11.4 percent stake in Fuji Heavy in the market and the Japanese auto maker will end a joint-development project with GM's Saab brand, Fuji Heavy said.

Fuji Heavy also said it and Toyota would study business tie-up opportunities in research and development as well as production.

[UpInArms]

17. Hurricanes, oil hurts worker optimism

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-10-05T102246Z_01_MAR537249_RTRUKOC_0_US-EMPLOYEE-CONFIDENCE.xml

NEW YORK (Reuters) - For the second month in a row, U.S. employee confidence fell to its lowest level in nearly two years, as Hurricanes Katrina and Rita and high gas prices took a toll on personal finances, a survey from Hudson Highland Group Inc. showed on Wednesday.

The survey, which polled about 9,000 workers, put its September employee confidence index at 96.8, its lowest level since the survey began in January 2004, and down from its previous all-time low of 98.2 in August. The employee confidence index fell 10 points from a year earlier.

Forty-seven percent of workers said their financial situation is getting worse, signaling that they expect high energy costs to continue through the winter months.

The survey also showed that high energy costs may be affecting much more than employees wallets, as the level of hiring optimism also fell.

...more...

[Tace]

18. MOGAMBO GURU: Hard Times Are Coming For Us All

Richard Daughty, the angriest guy in economics

October 5, 2005 -- I am, as hard as that is to believe, getting freaked out more and more. The Federal Reserve didn't increase total credit by much, but they did continue accelerating down the Road To Economic Hell (RTEH) by buying, outright, $2.4 billion of debt last week. In short, the government borrows by issuing debt, and the Federal Reserve creates the money to buy the debt! Bingo! Not only creating more money and credit, the damn thing that got us to this point, but to fund the activities of the government! Gaaahhhh!

The bigger news in this filthy area of the economic world, for me, is that Foreign Holdings of US debt deposited at the Fed went up by a whopping $7.6 billion last week. Whew!

But the biggest, scariest thing of all was that nominal incomes dropped. And when you adjust nominal incomes by the reduction in buying power from all the inflation around here, then it is no wonder that inflation-adjusted incomes dropped so much, too. But I wail like a wounded banshee (ooOOooOOoo!) when I realize that the government's piddly little chain-weighted, hedonically-adjusted statistical adjustment to incomes for inflation is around two stupid little percent. At that, I laugh this big booming Mogambo Laugh (BBML)! Hahahaha!

I am here to tell you, with the courage found only in a guy fully clad in body armor and sporting a machinegun in one hand and a flamethrower in the other, inflation is a LOT higher than two or three percent. Horribly higher. Like somewhere in the range of six to nine percent, at least. And so when you adjust incomes for the REAL rate of interest, then the drop in real, inflation-adjusted incomes is getting to be pretty significant!

(more)

http://worldnewstrust.org/modules/AMS/article.php?storyid=1140

[ozymandius]

19. Stock futures flat on rate

NEW YORK (Reuters) - U.S. stock index futures pointed to a flat opening on Wednesday, amid concerns the Federal Reserve will keep raising interest rates and negative earnings outlooks.

-cut-

In remarks on Tuesday, three top officials said the Federal Reserve will keep raising interest rates to keep inflation at bay and said it has no timetable to halt this tightening campaign.

"That type of Fed comment, combined with a couple of weak company negative warnings, does not bode very well for stock trading, said Andre Bakhos, president at Princeton Financial Group, in Princeton, New Jersey. "Demand is not likely to be strong today."

more

[ozymandius]

22. Stocks Set to Open Flat As GM Takes Focus

LONDON - U.S. stock market futures were mostly flat Wednesday, lacking direction amid mounting inflation concerns, with General Motors Corp. in focus on its stake sale of the overseas maker of Subaru and a possible deal to cut health-care costs.

-cut-

General Motors, a component of the Dow industrials, on Wednesday said it's selling its 20% stake in Subaru maker Fuji Heavy Industries, with 8.7% being sold to Toyota Motor for $315 million and the remaining 11.4% sold into Fuji Heavy's buyback plan, or through market sales if needed. GM will file an 8-K with the Securities and Exchange Commission to cut its FHI value by $700 million to $800 million.

Delphi Corp. is preparing to make a bankruptcy filing as early as this week, but may not carry it out depending on the concessions it can win from General Motors, its former parent, and the United Automobile Workers union, the New York Times reported Wednesday.

more

[ozymandius]

26. GM Sells Entire Stake in Fuji Heavy to Toyota, Market (Update4)

Oct. 5 (Bloomberg) -- General Motors Corp., the world's largest carmaker, agreed to sell its $746 million stake in Fuji Heavy Industries Ltd. as the U.S. company struggles with rising losses and the threat of a lower credit rating.

Toyota, GM's biggest competitor, will pay about $315 million in cash for 68 million shares, or 8.7 percent, of the maker of Subaru-brand cars, GM said in a statement on PRN newswire. GM will sell 11.4 percent of Fuji Heavy, worth about $422 million at today's closing share price, on the market.

GM faces further losses in North America as consumers opt for vehicles from Toyota and Nissan Motor Co. Detroit-based GM's declining sales of sport-utility vehicles has prompted S&P to review the carmaker's debt rating, which it cut to junk earlier this year. The company's largest supplier, Delphi Corp., is asking GM for financial assistance to stave off bankruptcy.

``It's surprising how fast GM is selling off the family silver,'' said Graeme Maxton, a director of the Economist Intelligence Unit in Hong Kong. ``It rings alarm bells.''

more

[UpInArms]

106. ripple effects of "selling off the family silver"

GM to restate 2nd-qtr results to reflect Fuji sale

http://today.reuters.com/investing/FinanceArticle.aspx?type=marketsNews&storyID=URI:urn:newsml:reuters.com:20051005:MTFH38691_2005-10-05_17-25-21_WEN0383:1

NEW YORK, Oct 5 (Reuters) - General Motors Corp. (GM.N: Quote, Profile, Research) on Wednesday said it will restate its second-quarter financial statements to reflect a $700 million to $800 million reduction in the carrying value of its equity stake in Japan's Fuji Heavy Industries (7270.T: Quote, Profile, Research).

GM said any cash proceeds and potential gain from the sale of its 20 percent stake in Fuji Heavy will be recorded in the fourth quarter.

GM is selling its 157 million Fuji Heavy shares to refocus its efforts and resources on the Asia Pacific region's high growth markets and with other strategic partners.

Toyota Motor Corp. (7203.T: Quote, Profile, Research)(TM.N: Quote, Profile, Research) will buy 68 million shares, or 8.7 percent of Fuji Heavy's total outstanding shares, for 520 yen, or $4.60, a share -- for a total consideration of $315 million.

...a bit more...

[ozymandius]

27. GM, Ford SUV woes are concern to analysts

Wall Street investors and a major credit-rating agency are getting increasingly concerned that plummeting SUV sales will weigh down future profits for General Motors Corp. and Ford Motor Co.

Brokerages Merrill Lynch and Goldman Sachs issued notes to investors Tuesday, citing their concerns about an accelerated move out of truck-based SUVs into cars and crossovers.

-cut-

He added, "We are growing increasingly concerned about the prospects of GM's new line of SUVs, which will be launched in January 2006."

Also citing declining SUV sales Tuesday, the credit-rating agency Standard & Poor's said it is reviewing GM and Ford operations and will decide by mid-January whether to move their credit ratings lower in junk status.

more...

http://www.freep.com/money/autonews/suv5e_20051005.htm

[ozymandius]

29. Are Ford, GM fit to survive post-SUV world?

WASHINGTON -- The good news is that big summer discounts helped ailing North American auto makers clear out most of their sport utility vehicles.

The bad news is that their factories are still geared toward cranking out hulking autos that buyers no longer want. September's auto sales figures confirmed the end of a 15-year North American love affair with the SUV. Sales of the oversized autos plunged last month as car buyers reacted to the sudden spike in gasoline prices that followed hurricanes Katrina and Rita.

The challenge now for U.S. auto makers -- most notably Ford Motor Co. and General Motors Corp. -- is to retool for the new market reality: Gas miserly is in and the behemoth is out.

"U.S. companies have never been good at making small cars," said Susan Helper, an auto industry expert and economics professor at Case Western Reserve University in Cleveland. "So it's an adjustment in mindset as well as technology."

-cut-

One option for Ford and GM is to curtail production of its SUVs, while adding extra shifts at plants that make more fuel-efficient vehicles, such as the Ford Focus or Saturn Ion, Prof. Helper said. And to some extent, that's what they are doing already. Ford has just halted production of the Excursion, the 6-metre-long king of the company's SUV line.

more

[trogdor]

39. U.S. companies have never been good at making small cars

That's because they do a half-assed job of it. Let's see here:

Ford Falcon - from what I've heard, not too bad. It was sufficiently popular for Lee Iococca to use its platform for the original Mustang.
Chevy Corvair - rear engine weirdness with a serpentine belt that went around pulleys oriented in two different axes. I hear people had to carry a spare in the glove box at all times.
Ford Pinto - bad engineering, worse execution, and they'd rust like no one's business. Dennis Miller once called it the "disposable car."
Chevy Vega - I've heard nothing good about that car. GM and the many unfortunate souls who bought these cars learned a valuable lesson, which was that you can't make engine blocks out of aluminum without cast-iron sleeves. Burned oil like a two-stroke. Internal engine parts would literally melt while idling at a red light.
Ford Escort - meh.
Chevy Chevette - double meh. The only good thing about this car was that it was designed by Opel in West Germany, and was therefore tough as nails, about as bulletproof a car as GM has ever produced. It still had zero-to-sixty times measured in minutes, though. I managed to get mine stuck in three inches of snow on nearly level pavement.
Chevy Cavalier - horrible car. Lots of cheap plastic everything. I'd see two year old Cavaliers in northern New York with rusted-out trunk lids.
Ford Focus - usually in the shop taking care of really scary recalls. One of the flimsiest-looking cars I've ever seen. I took one look at it when it first came out and wondered how bad you'd cave the hood in if you were to sit on it.
Saturn - Mom had one and she loved it to pieces. Literally. She wrecked it one day and it nearly broke her heart. Naturally, GM couldn't have inexpensive, fuel-efficient, reliable, rustproof cars in its lineup, so they let this line wither on the vine.

[UpInArms]

20. Delphi could file for bankruptcy this week-NYT

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T054502Z_01_N05706832_RTRIDST_0_AUTOS-DELPHI.XML

NEW YORK, Oct 5 (Reuters) - Delphi Corp. (DPH.N: Quote, Profile, Research), the struggling U.S. auto parts supplier, is prepared to file for bankruptcy as early as this week as it lines up lawyers and consultants, the New York Times reported on Wednesday.

The latest move came Monday when Delphi appointed David Sherbin as general counsel. Sherbin had worked with Delphi Chief Executive Robert Miller in the same capacity at Federal Mogul, which had filed for bankruptcy.

Whether Miller goes through with a bankruptcy filing for Delphi remains to be seen, the paper said. Miller has said he will file by Oct. 17 at the latest, when U.S. bankruptcy laws change, unless former parent company General Motors Corp. (GM.N: Quote, Profile, Research) and the United Automobile Workers union agree to a multibillion-dollar bailout.

Delphi employs nearly 50,000 people and makes parts for most new cars and trucks sold in the United States.

A Delphi bankruptcy would be painful for GM because the automaker, under the terms of Delphi's 1999 spinoff, agreed to provide medical and pension benefits to Delphi retirees if the company went bankrupt before 2007.

...more...

[UpInArms]

21. U.S. mortgage applications fall in latest week-MBA

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T110101Z_01_NAT001826_RTRIDST_0_ECONOMY-MORTGAGES-URGENT.XML

NEW YORK, Oct 5 (Reuters) - U.S. mortgage applications fell last week, as interest rates on 30-year home loans climbed to their highest levels since early April, an industry trade group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended Sept. 30 slipped 1.1 percent to 713.5 -- its lowest level since late May -- from the previous week's 721.2.

Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 5.94 percent last week, up 0.09 percentage point from 5.85 percent the prior week. The average 30-year rate touched its highest level since the week ended April 8 when it hit 5.95 percent.

The MBA's seasonally adjusted purchase mortgage index fell 1.9 percent to 473.8 from prior week's 483.1. The index, considered a timely gauge on U.S. home sales, declined for a third consecutive week to its lowest level since the last week of August when the purchase index was 470.6.

...more...

[UpInArms]

23. (Georgia) Graniteville mills begin 350 layoffs

http://chronicle.augusta.com/stories/100505/met_5360018.shtml

GRANITEVILLE - Avondale Mills Inc. officials announced Tuesday that 350 employees will be laid off, a move that comes after months of coping with the aftermath of a January chlorine spill that corroded some of its key textile plants.

"It's a direct result of the difficulties we've experienced because of the January derailment," said Stephen Felker Jr., a company spokesman.

Mr. Felker said the layoffs would occur immediately. It remained unclear Tuesday how the layoffs would unfold, though some employees were told that workers with seniority would be the last to go.

Earnestine Howard, of Augusta, who has worked at the Horse Creek plant for 10 years, said the mill's workers were called into two meetings Tuesday.

<snip>

Avondale has employed crews night and day to clean mills affected by the Jan. 6 chlorine release, which occurred when a moving train collided with a train parked outside one of its mills.

<snip>

Mr. Felker said the layoffs will be permanent and will affect all seven plants in the area, which employs about 2,500 people.

...more...

[UpInArms]

24. Bankruptcy Filings Soar In Advance of New Law

http://www.washingtonpost.com/wp-dyn/content/article/2005/10/04/AR2005100401763.html

Two weeks before a new, more restrictive national bankruptcy law goes into effect, financially strapped Americans are rushing to file for protection from their creditors, with filings climbing to an unprecedented average of 13,000 a day last week.

Week after week records are toppled. Last week's 68,287 filings surpassed the record set the week before by 24 percent, and this week's total is likely to be higher, according to data released yesterday by Lundquist Consulting Inc., a financial research firm. Daily filings averaged 10,367 in September, compared with an average of 6,079 in September 2004.

The surge is in anticipation of the new bankruptcy law, long sought by the financial industry, which takes effect Oct. 17. The law will make it harder and more expensive for people to completely wipe out their debts under Chapter 7 bankruptcy.



...more...

[UpInArms]

25. surCHARGING ahead: FedEx lifts rates for express, freight shipping in 2006

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.3454400463-844852073&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) - FedEx Corp. (FDX) said Wednesday it's raising its rates for FedEx Express U.S. domestic and export express package and freight shipments, beginning Jan. 2, 2006, by about 3.5%. Average shipping costs will rise 5.5%, offset by a 2% reduction in FedEx Express' fuel surcharge. Other surcharges will also start on Jan. 2, including a 10 cents per package surcharge on delivery to certain zip codes and for residential delivery. The company said it will announce changes to FedEx Ground rates later in 2005.

A "whiff" of inflation? Are you going to be "willing" to accept higher prices? Stand firm and "just say NO!"

:rofl:

[UpInArms]

105. AMERICAN AIR CARGO UNIT UPS U.S. FUEL SURCHARGE TO 22C/KG

1:43pm 10/05/05 AMERICAN AIR CARGO UNIT UPS U.S. FUEL SURCHARGE TO 22C/KG

1:42pm 10/05/05 AMERICAN AIR CARGO UNIT UPS INT'L FUEL SURCHARGE TO 55C/KG

[UpInArms]

28. Treasury Bonds up ahead of services-sector data

http://www.marketwatch.com/news/story.asp?guid=%7B5EE422DA%2D5BFF%2D4475%2D8C2E%2DED346A0AB0F1%7D&siteid=mktw

CHICAGO (MarketWatch) - Treasurys gained for a second day, pushed higher by speculation a report that measures service-sector health due later Wednesday morning will show some moderation from the previous month.

The bond market has largely consolidated after falling on Monday by enough to push yields to their highest in nearly two months.

Gains have been capped, however, by continued hawkish comments from Federal Reserve officials, which point to additional interest-rate increases at the Fed.

<snip>

The Institute for Supply Management's non-manufacturing index is seen moderating to 60.3% in September from 65% a month earlier, according to the average of a poll of economists conducted by MarketWatch.

It was this group's factory gauge, released Monday, that inspired a new leg lower in the bond market, pushing yields to their highest since Aug. 10. The report beat forecasts by showing a gain not a contraction and revealed a sharp rise in prices paid.

...more...

[UpInArms]

38. US Treasuries tick up as flows move out of stocks

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T125408Z_01_N05313135_RTRIDST_0_MARKETS-BONDS.XML

NEW YORK, Oct 5 (Reuters) - U.S. Treasury debt prices moved higher on Wednesday as weakness in global equity markets sent investment flows into the government bond market that has suffered more than a month-long sell off.

Ironically equity markets softened for the very reason the bond market has sold off in recent weeks: namely concerns about the Federal Reserve's clear intent to head off rising inflationary pressure with more interest rate increases.

The bond market barely reacted to the latest addition to the hawkish Fed chorus, Philadelphia Fed President Anthony Santomero, who said late on Tuesday the central bank would have to keep lifting interest rates to curb inflationary pressure.

"Comments from Fed officials overnight seem to have dealt a much bigger blow to equities than bonds," said Andre de Silva, deputy head of bond strategy at HSBC. "Treasuries are taking some solace from this."

...more...

[54anickel]

48. Nowhere to run to baby - nowhere to hide....I found this new mascot

for Shrubbie to go along with the Energy Hog

[ozymandius]

53. bad medicine

We need to take our medicine for these bubble-tastic excesses. But how should our medicine taste? Here are the flavor selections:

(a) vinyl
(b) monkey hide
(c) singed hair
(d) Tom DeLay
(e) GM's executive bathroom

[UpInArms]

79. Check-Kiting: Fed adds $4.75 bln reserves via overnight repos

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T151116Z_01_N05401465_RTRIDST_0_MARKETS-FED-OPERATIONS-URGENT.XML

NEW YORK, Oct 5 (Reuters) - The Federal Reserve said on Wednesday that it added $4.75 billion in temporary reserves to the U.S. banking system through overnight system repurchase agreements at a stop-out rate of 3.74 percent.

The benchmark federal funds rate last traded at 3.750 percent, at the Fed's target for the rate.

See for recent Fed open market operations.

Further details of the operations are available at: http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[UpInArms]

120. Fed's Hoenig does poor imitation of cheerleader

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T192541Z_01_WBT003977_RTRIDST_0_ECONOMY-FED-HOENIG-URGENT.XML

CASPER, Wyo., Oct 5 (Reuters) - The U.S. economy should shake off the impact of recent hurricanes without too much trouble and enjoy strong growth next year and beyond, Kansas City Federal Reserve Bank President Thomas Hoenig said on Wednesday.

"While the U.S. economy is going to face some pretty significant challenges, and does face some pretty significant challenges, my overall assessment is that the national economy ... will in fact be able to withstand it and I think have solid growth as we move through this transition into next year, 2006, and beyond," Hoenig told a group of business leaders.

Hoenig said private and Fed forecasters believed the hurricanes could trim about 0.5 to 1 percentage points off U.S. economic growth in the second half of this year. "I personally think it will be about a half a percentage point, at least closer to half a percentage point, than to one percentage point," he added.

[ozymandius]

30. pre-open blather

8:31AM: S&P futures vs fair value: -4.1. Nasdaq futures vs fair value: -1.0. Futures trade continues to suggest a lower open for the cash market. Aside from lingering inflation fears that were exacerbated by Dallas Fed President Fisher's comments yesterday, a few items on the corporate front have sparked an early bearish bias. ADC Telecommunication's (ADCT) lowered Q4 guidance, reports that Delphi (DPH) may declare bankruptcy as early as this week, and an analyst downgrade on Harley Davidson (HDI) shares have spurred some early declines...

8:02AM: S&P futures vs fair value: -4.1. Nasdaq futures vs fair value: -1.5. Stocks are set to open flat to slightly lower today, with traders perhaps waiting for the day's economic data to set a more definitive trading tone. At 10:00 ET, the September ISM Services report will be delivered, for which economists expect a read of 60.0. After that, all eyes will rest upon the EIA's weekly inventory report, which will hit the wires at 10:30 ET...

[UpInArms]

31. More Layoffs in KY Send Jobs Overseas

http://www.wtvq.com/servlet/Satellite?pagename=WTVQ/MGArticle/TVQ_BasicArticle&c=MGArticle&cid=1031785456124&path=

The jobs will go to Mexico and a workforce that will make vacuum cleaners for a fraction of the price.? The workforce who gives up those jobs will be left in Danville to try and start again and find other work.

That is the scenario for 370 full and part time employees at the Panasonic Plant in Danville, who announced massive cuts to their workforce on Monday.

The layoffs are part of a national trend that has seen millions of jobs go overseas. Since 2000 the Blue Grass state has seen more than 2700 jobs go to China, India, Mexico, and other countries.

...short blurb...

[Name removed]

82. Deleted message

Message removed by moderator. Click here to review the message board rules.

[UpInArms]

83. Hiya day2!

I think you'll get a better perspective of fiscal policies at DU :D

:hi:

[Name removed]

86. Deleted message

Message removed by moderator. Click here to review the message board rules.

[UpInArms]

94. The pension issue is not one that will be easily solved nor will

it go away on its own.

As for the other query - nope - I stay where sanity prevails. :D

[54anickel]

35. Greenspan, Term Ending, Returns to Randian Roots

http://www.bloomberg.com/apps/news?pid=71000001&refer=columnist_baum&sid=a4CvekRiYYdY

snip>

You wouldn't have seen any reference to it in the media coverage. And understandably so. There was no market-moving news in the first two-thirds of his speech.

Instead, Greenspan provided a brief history of the changing attitudes toward the government's role in the economy: the free- market capitalism of Adam Smith that prevailed in the 19th and early 20th centuries; the attempt at interventionist, demand-side management advocated by John Maynard Keynes during the 1930s Depression, when the market system seemed to fail to restore the economy to full employment; the resultant stifling of competition and economic stagnation of the 1970s; the failure of wage and price controls and eventual disillusion with regulation; and the ultimate triumph of free markets when ``the collapse of the Berlin Wall in 1989 exposed the economic ruin behind the Iron Curtain,'' Greenspan said.

snip>

While Greenspan's topic last week was ostensibly how greater flexibility has enabled the U.S. economy to handle shocks, the speech was really ``an attempt to rewrite history and can only be titled, `Damn, I'm Good,''' Fleckenstein said. For example, Greenspan went out of his way to remind us that the Fed was uncomfortable ``with a stock market that appeared as early as 1996 to disconnect from its moorings.''

The Fed chief has been spending more time of late on the possibly unmoored housing market than on any irrational pricing in the equity market. (Last week, the Fed published a working paper co-written by Greenspan on home equity extraction.) He must know ``the stock market is not valued any differently now than it was in 1996,'' Glassman said.

The price-to-earnings ratio of the Standard & Poor's 500 Index averaged 19.21 in 1996 compared with 19.59 in the first nine months of 2005. In other words, if it was disconnected then, it's disconnected now.

Does that mean that both home and equity prices are detached from the fundamentals?

more...

[54anickel]

37. Empty houses, falling prices: A boom dies

http://moneycentral.msn.com/content/P131154.asp?Printer

snip>

Anyone home?
That leads me to Alan Greenspan -- the very man who created the conditions for the stock bubble and the housing bubble -- who (1) claimed that real estate couldn't experience a bubble, (2) actually suggested that folks obtain adjustable-rate mortgages as short-term rates were making their lows, and (3) has been unable to realize that the Fed should have been warning banks about their imprudent lending standards.

But if you can't see a problem, you can't try to head it off at the pass -- just as he was oblivious to the bad real-estate loans and junk-bond "investments" that helped precipitate the 1990-91 S&L collapse.

Ironically, in 1985, as a paid consultant to Charles Keating's Lincoln Savings & Loan, Greenspan proclaimed that its management was "seasoned and expert" -- with a "record of outstanding success in making sound and profitable direct investments." He later wrote a letter to Edwin Gray, then-chairman of the Federal Home Loan Bank Board, telling Gray to "stop worrying so much," and "that deregulation was working as planned." Greenspan noted 17 S&Ls that had just reported record profits. Within four years, 15 of those 17 institutions were out of business, costing the Federal Savings & Loan Insurance Corp. $3 billion.

Just as the masthead of my daily column says "All roads lead to inflation," by my reckoning all financial problems lead back to Greenspan. I have not penned a Greenspan rant in some time. Given all the focus on his speech last week -- and the fact that he's getting ready to ride off into the sunset -- I will have a special follow-up column tomorrow to reprise his comments. Stay tuned.

more...

[trogdor]

41. Naturally, Greenspin misses the mark.

Widely.

I subscribe to the Abbott and Costello theory of macroeconomics. To have a successful comedy team, you need a funny man and a straight man. Anyone want to guess what'll happen to the Al Franken Show after Katherine leaves? My guess is, he'll find another straight (wo)man because he'll fall flat on his face doing the show by himself.

Similarly, you need both Smith AND Keynes to keep an economy going. Too much Smith, and you have Republican robber barons running the economy into the ground for fun and profit. Too much Keynes, and you get the sort of stagflation Greenspin was talking about. Things have to be kept in balance.

[AnneD]

64. Good Call

I feel the same way except I talk about a one winged bird-ya just fly in a circle...but the same concept.

[ozymandius]

42. markets are open for giving you the bidness

9:32
Dow 10,428.05 -13.06 (-0.13%)
Nasdaq 2,138.61 -0.75 (-0.04%)
S&P 500 1,213.09 -1.38 (-0.11%)
10-Yr Bond 43.62 -0.14 (-0.32%)
NYSE Volume 29,802,000
Nasdaq Volume 42,754,000

[54anickel]

45. Bush military bird flu role slammed

Ya ever notice how the military is BeelzeBush's answer to everything? Seems strange coming from a chicken-hawk. What other plans for martial law are floating around in his otherwise empty head?

http://edition.cnn.com/2005/POLITICS/10/05/bush.reax/

WASHINGTON (CNN) -- A call by U.S. President George W. Bush for Congress to give him the power to use the military in law enforcement roles in the event of a bird flu pandemic has been criticized as akin to introducing martial law.

snip>

Giving the military a law enforcement role would be an "extraordinarily Draconian measure" that would be unnecessary if the nation had built the capability for rapid vaccine production, ensured a large supply of anti-virals like Tamiflu and not allowed the degradation of the public health system.

"The translation of this is martial law in the United States," Redlener said.

snip>

"I think the president ought to have all options on the table," Bush said, then corrected himself, "all assets on the table -- to be able to deal with something this significant."

Now THAT was a scary slip!!! :scared:

more...

Wonder what that other billion to the Pentagon is ear-marked for regarding the flu?

[AnneD]

97. howz about

declaring martial law, canceling elections and declaring himself dick-tater for life. Actually, while the avian threat is real, I think this is just another terra alert-something to keep our minds off of how badly he is doing.

[UpInArms]

49. U.S. Sept. layoffs up 1.8% to 71,836: Challenger

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.4168940394-844866126&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Planned job reductions by major U.S. corporations rose 1.8% in September to 71,836, according to a monthly tally released Wednesday by outplacement firm Challenger, Gray & Christmas. Layoffs were down 33% from September 2004. Layoffs in the third quarter were down 2.5% from the third quarter of 2004. It was the smallest number of layoffs in five quarters. However, layoffs are up 8.2% year-to-date. The transportation and retail sectors accounted for more than third of September reductions.

10:00am 10/05/05 U.S. Q3 LAYOFFS DOWN 2.5% Y-O-Y TO 245,378: CHALLENGER

10:00am 10/05/05 U.S. SEPT. LAYOFFS UP 1.8% TO 71,836: CHALLENGER

[ozymandius]

50. HUGE 10am bounce (in alternate universe)

10:09
Dow 10,387.24 -53.87 (-0.52%)
Nasdaq 2,122.50 -16.86 (-0.79%)
S&P 500 1,208.43 -6.04 (-0.50%)
10-Yr Bond 43.57 -0.19 (-0.43%)
NYSE Volume 333,719,000
Nasdaq Volume 309,996,000

[UpInArms]

51. 10:10 EST flying like a lead balloon

Dow 10,387.10 -54.01 (-0.52%)
Nasdaq 2,122.38 -16.98 (-0.79%)
S&P 500 1,208.43 -6.04 (-0.50%)
10-Yr Bond 4.357 -0.19 (-0.43%)

NYSE Volume 333,719,000
Nasdaq Volume 309,996,000

9:40AM: As futures trade had presaged, the stock market's major averages began the session in the red. Following the market's reaction to Dallas Fed President Fisher's comments yesterday, which were essentially a reassertion of the fact that the Fed will remain vigilant in fighting inflation via more rate hikes, traders remain inflation wary ahead of the morning's economic data and amid worries over what the inventory report may hold...

At the top of the hour, the market expects an ISM Services read that reflects a decline to 60.0 from the prior month's 65.0 while at 10:30 ET, traders will receive the EIA's inventory report that is expected to show draw downs in crude, gasoline, and distillates last week...

(edited for html)

(edited again 'cause it was, as Ozy said - more appropriate in red )

[ozymandius]

52. Please leave the font color.

Red is the mood for the day -'cepting for bonds of course.

[nolabels]

61. The red letter edition?

As you sow, so shall you reap :crazy:

[AnneD]

98. wonder how it will look

when some one high up stands up and says the emperor has no clothes. How low can you go.

[UpInArms]

54. Privatizing Profits - Socializing Losses

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38630.4331765972-844869589&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- The Pension Benefit Guaranty Corp. said Wednesday it has assumed responsibility for the pensions of 3,700 Huffy Corp. (HUFCQ) workers and retirees. The Miamisburg, Ohio, bicycle and sporting goods distributor's pension plan is 53% underfunded, and facing a $80.7 million shortfall, according to the PBGC. The government agency expects to provide $80 billion of this amount. Huffy filed for bankruptcy protection in October 2004 and the bankruptcy court ruled that Huffy satisfies the legal requirements for terminating the plans. The PBGC expects to recover between $7 million and $9 million through Huffy's bankruptcy proceeding.

10:11am 10/05/05 GOVERNMENT AGENCY TAKES OVER 3,700 HUFFY CORP. PENSIONS

[54anickel]

57. Deregulation helps buyout firms, if not the ratepayers

http://www.chron.com/cs/CDA/ssistory.mpl/business/3382585

snip>

I'm all for competition and consumer choice, but it's becoming increasingly clear that electricity deregulation in this state has little to do with consumers. The benefits are farther up the chain.

Which brings me to the second gut-punch consumers received from local utilities this week: New Jersey-based NRG Energy's plan to buy Texas Genco for $5.8 billion.

snip>

Leave it to Bondo to find a quick profit in a staid pile of power plants. His firm and the others will get a return of about six times their investment of $900 million in cash.

snip>

Even in the gunslinging world of private equity, this deal is over the top. How can a group of power plants increase in value by more than $2 billion in a little over a year?

The explanation resides in the serpentine corridors of Texas's electric deregulation process, which pegs the wholesale price of electricity to the price of natural gas.

Since Genco went private, the price of natural gas has more than doubled. But half of Genco's generating capacity runs on less expensive fuel, such as coal. So its operating costs remained low while the price it can charge soared.

more...

[ozymandius]

58. Stocks fall on warnings, rate worries

NEW YORK (Reuters) - U.S. stocks were lower on Wednesday, with investors facing a wave of warnings of lower-than-expected quarterly earnings and renewed fears of further interest-rate hikes.

Investors also fretted about comments Tuesday from three top
Federal Reserve officials that, contrary to Wall Street's hopes, the central bank has no timetable in mind to end its campaign of interest-rate hikes. .

"They may have had some unrealistic expectations about the Fed," said Michael Strauss, chief economist at the Common Fund, of Wilton, Connecticut. "People are beginning to wake up."

more technical data

[AnneD]

101. people are starting to wake up

translation...more suprised economists.

[UpInArms]

59. Hoosiers facing economic strains

http://www.courierpress.com/ecp/ebj/article/0,2578,ECP_19916_4132082,00.html

With a rising bankruptcy rate and higher energy prices, Hoosier consumers are facing more economic challenges than the rest of the country, according to a new federal report.

A study released Tuesday by the Federal Deposit Insurance Corp. said Hoosiers had one of the nation's highest bankruptcy rates and the slowest rate of home price growth in the country during the second quarter.

Rising energy prices due to Gulf Coast hurricanes will put an additional strain on households, said David VanVickle, general manager of the FDIC's Division of Insurance and Research in Chicago.

"The large part of the burden will fall to lower-economic tier households," VanVickle said. "I don't know if I've seen anything like this before."

Beginning next year, the average American household is expected to spend an extra $1,000 a year on energy, including electricity, gasoline, natural gas and other heating fuels, VanVickle said.

...more...

[UpInArms]

60. New England - Recent growth hasn't erased recession losses, study says

http://www.newsday.com/news/local/wire/connecticut/ny-bc-ct--newenglandeconomy1004oct04,0,6764154.story?coll=ny-region-apconnecticut

BOSTON -- New England continues to recover from recession more slowly than most of the nation, economists with the federal government's insurer of bank deposits said Tuesday.

A quarterly report from the Federal Deposit Insurance Corp. ranks New England eighth among nine regions nationally for job growth in this year's second quarter, compared with last year's April-June period.

The FDIC attributes the slow growth to lagging population growth across New England.

<snip>

In Massachusetts, data shows that the state has posted job gains in 11 of the past 12 months. But it has regained only about a quarter of the 207,000 jobs lost since employment peaked in 2001.

The recession persisted longer in Massachusetts than it did nationwide, in part because the state's dependence on technology jobs produces volatile swings in good times and bad.

"Those jobs have been very slow to come back," Paul M. Driscoll, manager of the FDIC's office in Braintree.

...more...

[UpInArms]

62. New look to the nickel - Happy Jefferson - does that cheer you up?

http://money.cnn.com/2005/10/05/news/funny/nickel/

NEW YORK (CNN/Money) - The nickel is getting such a facelift in 2006 that it will look a lot different than any other U.S. coin preceding it.

The United States Mint announced Wednesday that the 5-cent piece coming out early next year will still include President Thomas Jefferson and his Monticello home on the reverse. But instead of a profile image, Jefferson will be facing forward, marking the first time that a forward-looking image is used in U.S. coinage.

Acting Mint Director David A. Lebryk said the new coin, entitled "Jefferson, 1800," represents Jefferson's forward-looking vision that included the Louisiana Purchase and the Lewis and Clark expedition.

The Mint said the image is expected to stay with the coin for an unspecified number of years.



...more...

[ozymandius]

69. It will increase the intrinsic value.

Although the actual value will be that of a nickel made from wood.

[Neshanic]

76. Happy money means a happy economy. Ask any economist.

[AnneD]

104. I wish

the First National Bank of Beverly Hills would stop with the face lifts. Instead of a total money makeover, how 'bout a total economy makeover.

[UpInArms]

65. 10:36 EST red letter edition continues

Dow 10,408.61 -32.50 (-0.31%)
Nasdaq 2,123.69 -15.67 (-0.73%)
S&P 500 1,208.70 -5.77 (-0.48%)
10-Yr Bond 4.341 -0.35 (-0.80%)

NYSE Volume 532,554,000
Nasdaq Volume 491,142,000

10:30AM: The market moves lower as traders digest the ISM data. While a larger than expected drop on the ISM services index, from 65.0 in August to 53.3 - the lowest level since April 2003 - has raised concerns about the pace of economic growth, it appears that a stronger than expected jump in the prices paid index, which rose to a record high of 81.4 from 67.1, has merely exacerbated early inflation worries...

Adding to the troubling mix of decelerating growth and rising inflation concerns, traders' attention to the flattening yield curve further weighs upon stocks, has prohibited early leadership from emerging, and pushes each of the ten economic sectors further underwater...NYSE Adv/Dec 783/1965, Nasdaq Adv/Dec 624/1892

10:00AM: The ISM Services report checked in at 53.3, reflecting a greater than expected decline over last month's 65.0 read - economists had projected 60.0 - but still came in above the 50% mark that signifies expansion. With the jobs data on Friday's docket and with the latest petroleum inventory report due out at the bottom of the hour, the ISM data did not garner much initial attention or spark much immediate action within the equity market... As such, the indices remain beneath the flat line amid a lack of leadership...

Similarly, the Treasury market was unfazed by the headline; the 10-year note (+03/32) has held steady, offering investors a 4.35% yield... NYSE Adv/Dec 718/1833, Nasdaq Adv/Dec 762/1608

[Roland99]

66. But...but...but...taking out the core energy price and all is well!

Isn't that what they've been saying for months?

[ozymandius]

71. Does anyone get the sense that the Fed is losing as much

control over its management of economic issues just as Congress has lost control of the budget deficit?

[UpInArms]

74. IMHO, when such fools as Meanspin

can climb to such a "lofty" position in people's minds - remember this is just as much about "popularity" as in the rise of Michael Jackson - there is nowhere to go but down. The fickle finger of fate will doom this one-man circus clown because he has believed in his poll numbers instead of learning and adapting to the world as it changes and adapts.

He has a fixed point of reference that has blinded him to the reality of what the results of his "accomplishments" actually were.

This is the biggest problem with ideologists. They can then create bigger problems for the rest of the world when they reach offices of power.

[fasttense]

73. Ozy your political cartoon made me spit up my coffee. Thanks

for always keeping us informed.

[ozymandius]

75. You're welcome!

And thanks for adding your two sips worth.

:spray:

[ozymandius]

77. 11am numbers - vultures circling

Dow 10,404.39 -36.72 (-0.35%)
Nasdaq 2,124.50 -14.86 (-0.69%)
S&P 500 1,209.03 -5.44 (-0.45%)
10-Yr Bond 43.44 -0.32 (-0.73%)
NYSE Volume 669,642,000
Nasdaq Volume 606,170,000

Gotta run for awhile. See you this afternoon.

Ozy :hi:

[UpInArms]

78. a side of blather

11:00AM: Still submerged, each of the indices are currently running in place... At the bottom of the hour, the EIA reported that crude oil inventories fell less dramatically than had been forecasted, declining 246K barrels vs. the -1.70 mln barrel consensus. Gasoline and distillates supply, meanwhile, fell more than expected. Gasoline inventories slid 4.38 mln barrels, vs. the expected 3.0 mln barrel draw down, while distillates declined 5.53 mln barrels, vs. the estimated 2.0 mln barrel draw down...

Crude (+$0.05 $63.95/bbl ) and natural gas (+0.336 $14.560/mln BTUs) continue to head north; gasoline (-0.016), on the other hand, has reversed course and presently sports a 2.00/gal pricetag...NYSE Adv/Dec 701/2179, Nasdaq Adv/Dec 727/1975

Have a great day Ozy! :hi:

[UpInArms]

80. Hedge funds confounded by U.S. bond prices

http://www.iht.com/articles/2005/10/05/business/gflede.php

LONDON Hedge funds are still betting on lower prices for U.S. Treasury bonds because they think rising U.S. interest rates will eventually outweigh the strong Asian demand for Treasury issues, according to hedge fund managers.

Rising rates would normally mean lower bond prices and higher yields, but it has not happened to any significant degree this time, and many hedge funds, particularly in the United States, are having a tough time.

In June 2004, when the U.S. Federal Reserve raised benchmark interest rates by a quarter of a percentage point from a historical low of 1 percent, yields on 10-year Treasury bonds jumped to around 4.8 percent.

By September of last year, they were around 4.0 percent, and they are now about 4.35 percent. The Federal Reserve, meanwhile, has raised benchmark interest rates to 3.75 percent.

"It's against all historical precedents," said Simon Smith, a strategist at Weavering Capital, a British hedge fund. "It's caught a lot of hedge funds off guard."

Hedge funds that sold U.S. Treasury issues before the first Fed interest-rate increases - in March 2004, when yields were below 4 percent - have made money. Some waited too long and have been holding unprofitable positions through the series of Fed rate increases. Hedge funds have also been confounded by the flattening of the Treasury bond yield curve, which normally slopes upward.

...more...

Yes, another "unprecedented" occurrence - similar to the "unprecedented" selection by the USSC on December 12, 2000.

[UpInArms]

81. 11:30 EST falling faster now

Dow 10,383.47 -57.64 (-0.55%)
Nasdaq 2,118.38 -20.98 (-0.98%)
S&P 500 1,206.79 -7.68 (-0.63%)
10-Yr Bond 4.344 -0.32 (-0.73%)

NYSE Volume 841,980,000
Nasdaq Volume 721,643,000

[UpInArms]

87. Dutch, Russian officials raid YUKOS offices

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-10-05T153915Z_01_L05605059_RTRIDST_0_ENERGY-YUKOS-RAIDS-UPDATE-1.XML

excerpt:

State prosecutors said four office addresses in Russia had been raided in connection with an alleged scheme to spirit billions of dollars out of Russia.

A YUKOS spokeswoman in London also said officials had raided the firm's YUKOS Finance B.V. subsidiary in Amsterdam, which owns its foreign assets.

"Yes, we can confirm that a visit took place at YUKOS Finance B.V," the spokeswoman told Reuters. "We are ascertaining the full purpose of the visit and what documents, if any, were removed."

The raids come as YUKOS's creditor banks and its main shareholder, Menatep Group, pursue YUKOS Finance B.V. through the Dutch courts in a bid to recover a total of around $1 billion from the company.

They have turned their sights on the foreign assets of YUKOS after Russian tax officials froze the firm's Russian property and hit it with a $27.5 billion back-tax claim.

The raids in Moscow region are the latest of many criminal and civil moves brought against YUKOS and its subsidiaries, but they come after a week when YUKOS investors saw a rare share price revival on hopes the firm might not be totally destroyed.

"The investigating team has information that during 2000-2003 some leaders and officials from YUKOS stole $7 billion and legalised it by taking it out of the country," Russian prosecutors said in a statement.

...more...

the plot thickens:

http://www.pbs.org/frontlineworld/stories/moscow/khodorkovsky.html

Mikhail Khodorkovsky, 40, Russia's wealthiest man, made his first fortunes in banking.

Estimated Worth:
$8 billion

Current Position:
Founder, Menatep Group

Major Holdings:
Yukos

Other Interests:
Bank Menatep, Trust Investment Bank and Menatep International Financial Alliance; investment firms Global Asset Management, the Blackstone Group, the Carlyle Group and AIG Capital Partners: information technology company Sibintek; telecom operators MKS, Macomnet, Metrocom, Rascom and Magistral Telecom; and, through his Open Russia Foundation, several Russian news publications

Political Connections:
Khodorkovsky cultivated relationships with government officials through his bank, Menatep, which served the accounts of many state enterprises and regional governments. Three years before his acquisition of oil company Yukos, Khodorkovsky was appointed to the Ministry of Fuel and Energy. In 1996, he was among the Big Seven, Russia's most influential bankers who backed the reelection of President Boris Yeltsin. Khodorkovsky's longtime partner, Leonid Nevzlin, is a senator in the Federation Council (the upper chamber of the Russian parliament; seats in the Federation Council are appointed). Despite an informal pact Russian oligarchs made with Putin in 2000 that they would stay out of politics, Khodorkovsky has become increasingly involved in the Kremlin's affairs. He has financed two liberal opposition parties, Yabloko and the Union of Right Forces, upsetting Putin's dominance in the Russian parliament.

New Plays:
In April 2003, Khodorkovsky announced his intention to merge Yukos with competitor Sibneft to create the fourth-largest oil company in the world. Although antimonopoly officials have approved the merger, with the ongoing investigations into Khodorkovsy's activities, it may be delayed.

Lifestyle:
Khodorkovsky lives with his wife and four children in Moscow. He frequently travels to the United States. He reportedly dined with Condoleezza Rice last year and recently was a guest at Herb Allen's Idaho ranch, along with Bill Gates, Warren Buffett and other luminaries, for an annual telecommunications executives meeting.

Notoriety:
After a series of dubious business practices, Khodorkovsy has struggled with a poor public image. In 1998, his bank Menatep collapsed, yet Khodorkovsky managed to protect himself, despite damage to his depositors and creditors. (The bank also defaulted on a $236 million loan from Western banks.) In 1999, he moved the location of a Yukos shareholders meeting 160 miles from Moscow without advance notice to minority stockholders, keeping them from voting against the sale of Yukos's assets to an offshore company. That same year, he prepared a large issue of new shares that diluted the stake of American investor Kenneth Dart, who claimed Khodorkovsky defrauded him of millions of dollars. Recently, however, Khodorkovsky hired a Washington, D.C., public relations firm, and he is presenting himself as a crusader for stockholder and investor rights. Khodorkovsky donated $1 million of Yukos profits to the U.S. Library of Congress, and he set up the Open Russian Foundation, with Henry Kissinger as a member of its board of trustees, to donate to museums, hospitals and universities. In 2001 and 2002, Khodorkovsky's net worth increased fourfold.

...more...

[54anickel]

88. Salaries in India are fastest rising in world

http://news.ft.com/cms/s/5f8b2f22-34cc-11da-9e12-00000e2511c8.html

A global survey has shown India's private sector salaries are rising faster than anywhere else in the world, the latest indicator of the country's strong economic growth.

A report by Mercer Human Resource Consulting, based in London, estimates India's salaries will improve 7.3 per cent above inflation next year, and 11.3 per cent year on year.

“The survey is capturing the strong growth momentum in India's corporate sector,” said Rajeev Malik, a senior economist at JPMorgan Chase Bank in Singapore.

The only country among the 70 surveyed that came close to India's inflation-adjusted wage growth was Egypt, where salaries are expected to rise 7.1 per cent above inflation and 12 per cent overall.

In Asia, China is seen experiencing the second-highest salary rise in 2006, with average corporate pay going up at an inflation-adjusted 4.8 per cent and 7.8 per cent year on year. By comparison, salaries in the UK and the US are forecast to nudge up 1.5 per cent and 1 per cent above inflation, respectively.

snip>

Economists said higher wages among India's salaried professionals could fuel inflation. “The central bank should take notice,” Mr Malik said. “Wage increases mean people have more disposable income to spend, which creates inflationary pressure.” :eyes:

more...

[napi21]

91. Persentage increases in India & China are very misleading!

Increase wages from .40/hr to .80/hr and say wages increased 100%, but if wages increase from $10.00 to $10.40 it's the same dollar amount but only 4%.

I'm sure it's quite dramatic for those in India & China, but misleading on it's face.

[54anickel]

144. Fed wary of rising wages, commodities

http://today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2005-10-05T212550Z_01_MOR569912_RTRUKOC_0_US-ECONOMY-FED-HOENIG.xml

CASPER, Wyoming (Reuters) - The combination of rising price pressures from wages and commodities means U.S. central bank policy-makers must be specially wary of inflation, a top Federal Reserve policy-maker said on Wednesday.

snip>

"I'm not concerned that we'll have a massive breakout (in inflation) but it's important to know what kinds of pressure are in the economy and what we have to be alert to ... so that we can in fact sustain long-term growth," Hoenig said.

He noted rates for U.S. productivity -- hourly output per worker -- were easing to around 2.5 percent from as much as 4 percent to 5 percent in recent years. Higher productivity is associated with rising living standards while lower rates mean it costs more to produce the same amounts of goods.

"So we're seeing unit labor costs rise at about a 4 percent rate and that's the highest it's been since year 2000, so we have some wage pressures that look to be entering the economy at this point," Hoenig said.

more...

[UpInArms]

89. "growth contracting, inflation rampant and poverty soaring"

Which country is this?

Zim in state of collapse - IMF

http://www.news24.com/News24/Africa/Zimbabwe/0,,2-11-1662_1811266,00.html

Washington - The International Monetary Fund warned on Tuesday that Zimbabwe's economy is in a state of virtual collapse with growth contracting, inflation rampant and poverty soaring.

In an annual report issued after Zimbabwe won a six-month reprieve from the threat of expulsion from the IMF, Fund directors expressed "deep concern" at the economic situation under President Robert Mugabe.

The report said: "Directors observed that without a bold change in policy direction, the economic outlook will remain bleak, with particularly detrimental effects on the poorest segments of the population."

IMF forecasts laid bare the economic crisis gripping a country once known as the breadbasket of southern Africa.

Zimbabwe's gross domestic product is expected to contract by about seven percent this year owing to "difficulties in agriculture, rising inflation, and foreign exchange shortages, particularly for fuel imports".

The country's GDP already shrank by about 4% last year and 10.5% in 2003, the IMF said.

Inflation hit a peak of 623% in January 2004 before "stabilising" around 130% in early 2005 and then surging again to 254% in July, it said.

"The widening fiscal deficit and quasi-fiscal activities would contribute to money growth, pushing inflation to over 400% by end-2005."

...more...

Hopefully, that will not be our future.

[patcox2]

99. It won't, unless we expel all europeans, confiscate their farms and factor

factories.

Thats pretty much Zimbabwe's problem.

[UpInArms]

112. US poverty: chronic ill, little hope for cure

http://news.yahoo.com/news?tmpl=story&cid=1896&e=9&u=/nm/20051005/us_nm/poverty_usa_dc

WASHINGTON (Reuters) - Four decades after a U.S. president declared war on poverty, more than 37 million people in the world's richest country are officially classified as poor and their number has been on the rise for years.

Last year, according to government statistics, 1.1 million Americans fell below the poverty line. That equals the entire population of a major city like Dallas or Prague.

Since 2000, the ranks of the poor have increased year by year by almost 5.5 million in total. Even optimists see little prospect that the number will shrink soon despite a renewed debate on poverty prompted by searing television images which laid bare a fact of American life rarely exposed to global view.

The president who made the war declaration was Lyndon Johnson. "Unfortunately, many Americans live on the outskirts of hope, some because of their poverty, and some because of their color, and all too many because of both. This administration declares unconditional war on poverty in America."

<snip>

The percentage of black Americans living in poverty is 24.7, almost twice as high as the overall rate for all races.

...more...

[mike923]

117. I grew up below the poverity line...

And i'm going to retire a millionaire, probably 3 or 4 times over. I wouldn't say the path my life has taken from where i started to where i finished is anywhere outside what one would consider normal. I went to school, worked at the grocery store afterwards, went to college, and worked at a golf course in the summers. Graduated from college, avoiding any serious addictions, and have worked full time since graduation day. I've been able to buy a house, pay my college loans, and put money towards retirement each and every month.

There is a way out of poverity, and it is simply to get an education, and to show up for work every morning.

[UpInArms]

118. Hi There mike923!

Glad to have you drop in to the SMW - thanks for adding some hope and encouragement to the discussion.

I have worked in ghettos and have seen the generational loss of that very hope - it has etched some very strong feelings about poverty and its consequences in my psyche.

Education really is the key, isn't it?

:hi:

[mike923]

123. Thank you UP!

Thank you for the time you put in to make this daily thread very informative and entertaining. It's the thread i look forward to reading every day.

I may have made it sound like it is an easy thing going from poverity to enjoy the comforts money can bring to ones life, re-reading my post. Certainly i agree with you that education is the key. Having a desire to improve one's life is just as important. There is a third important ingrediant, and that is role models that show the way in life. The path isn't easy, but i would say it is nearly impossible if one doesn't recognize a path even exists. This final part is what i see has broken down in some parts of our society.

The scary part is, there isn't a program i can think of to solve it.

[UpInArms]

131. Information

our life's blood - the biggest problem with the MSM is it's all infotainment and very little info - what a wonderful tool it could have been had it not become just another avenue for corporate profits.

IMHO your life (whether hard or easy) which entailed an upward mobility - generated by personal desire and helped by knowledge - would be a genuine help to those that are trapped in the world of poverty and despair. Despair and hopelessness tend to generate more despair and hopelessness and the cycle doesn't break on its own. It requires a catalyst - a reason for believing in the hard work and effort that it takes to get away from the trap of poverty.

Our educational system worked (mostly) when I was in it - it doesn't seem to now - for a myriad of reasons.

One of the best things about DU and forums like it (where thought and rationality do prevail) is that people can learn from other people's experience and knowledge, regardless of their physical location.

The daily SMW thread is important to me and my thanks go to Ozy, who faithfully gets it going and keeps the energy focused with his understanding of it all - and to all those that drop in here during the day and contribute their knowledge, thoughts and experiences.

To all of you, my hat is off



Me? I'm just a finance geek :blush:

[54anickel]

142. Somewhat related article, from the sociologist point of view

http://mrzine.monthlyreview.org/vogel041005.html

snip>

Inequality and Crime

Twenty years ago, a diverse group of sociologists clearly established that social injustice experienced by oppressed groups in society leads to a state of frustration and anger, which in turn leads to hostility and criminal behavior. Criminal activity is most likely, these investigators observed, when the deprived can witness wealth and luxury firsthand but cannot partake of it through conventional means. It was also twenty years ago when the de-industrialization of the U.S. economy was in full swing, producing vast fortunes for the capitalist class and widespread economic dislocations for working people. During the next two decades, income and wealth inequality in the U.S. skyrocketed to historic heights.

These two decades have also witnessed the neo-conservative ideologues and their political machines seize control of local, state, and the federal governments. Predictably, no meaningful social or economic reforms for the relief of the poor have been forthcoming. The crises of the working class have been met with neglect and repression - - disenfranchisement, dismantling of the social safety net, expansion of the police state, and mass incarceration. Playing on public fear of crime, the neo-conservative politicians have also exploited the opportunity to arm the affluent against the dispossessed.

The NRA is currently following the same strategy it used to champion CHLs in the 1980s and 90s -- after the initial victory in Florida it is lobbying to have its model SYG law adopted in other states. The agenda of the NRA is clear enough -- handgun sales are stagnant, and the new laws should stimulate the market -- it worked with the CHLs. The impact of the law on actual shootings is something else. The widespread adoption of CHLs did not produce a significant increase in civilian shootings nor should the SYG laws. One thing, however, is for certain -- the Florida SYG law, which took effect on October 1, has extended the right to use deadly force in defense of private property and taken it to the streets of Florida. As a symbolic victory, it is a sign of the times.

more...

[UpInArms]

92. 12:32 EST staying with the red theme for the day

Dow 10,381.55 -59.56 (-0.57%)
Nasdaq 2,118.21 -21.15 (-0.99%)
S&P 500 1,205.40 -9.07 (-0.75%)
10-Yr Bond 4.344 -0.32 (-0.73%)

NYSE Volume 1,213,757,000
Nasdaq Volume 987,948,000

12:05PM: Launched on negative footing, largely amid inflationary concerns that yesterday's comments from Dallas Fed President Fisher fed, the indices continue to languish near session lows midday as all ten economic sectors remain underwater. Exacerbating early inflation worries has been a higher than expected jump in the prices paid component of this morning's ISM services index, which rose to a record high of 81.4 from 67.1, countering a headline index read of 53.3 (consensus 60.0) which in turn brought into question the pace of economic growth...

Also weighing on sentiment has been a disappointing EIA report, which showed distillates (i.e. heating oil) fell more than two times greater than expected - declining 5.53 mln barrels. After a few weeks of better than estimated gasoline inventories, a larger than expected draw of 4.38 mln barrels, vs. an expected 3.0 mln barrel decline, has also underpinned a sense of nervousness. Leadership is altogether absent today, led lower by Energy's 2.3% decline. A less than expected decline in crude supply (-246K barrels vs. -1.7 mln barrel consensus) has sent crude lower and sparked further profit taking across the sector, extending yesterday's 3.4% loss and paring some of its 34.4% year-to-date profit... Crude's reversal, though, has not helped the inflation-fixated market...

The Materials sector (-1.9%) stands as the second place laggard, pressured by wide-spread selling, and, particularly, Phelps Dodge's (PD 127.43 -7.07) 4.7% plunge following an analyst downgrade. A fiscal Q4 profit warning form ADC Telecommunications (ADCT 18.74 -3.93), by which the company nearly halved its earnings outlook, has sent shares reeling over 17% and has helped contribute to the Tech sector's 1.0% loss, while Mercury Interactive (MERQE 31.92 -4.98), which similarly cut its Q3 guidance, resulting in a 13.0% plunge, has further weighed on the sector... Despite modest strength in today's Treasury market, the flattening yield curve continues to occupy traders' attention and provides further reason for buyers to remain at the sidelines. In addition, caution ahead of Friday's jobs data may also hinder buying activity... In addition, caution ahead of Friday's jobs data may also be hindering buying activity... ..NYSE Adv/Dec 641/2402. ..NASDAQ Adv/Dec 643/2172.

[antigop]

100. Wall Street Pushes to Relax Pension Rules --- OH, NOOOOO!

http://www.businessweek.com/@@n*BtOYUQWqItpRsA/magazine/content/05_41/c3954068.htm

(registration required)

>>
What the Wall Streeters want: looser fiduciary rules and easier conflict-of-interest limits in pension law. Securities firms have long been eager to run pension money with fewer controls by the Employee Retirement Income Security Act. Now they're leaping on pension reform -- a must-pass bill propelled by the latest airline bankruptcies -- to win some relief. The likely result: more pension investments in hedge funds and less protection for workers and retirees. "This is about Wall Street wanting to attract more money without regulatory constraints," says Damon A. Silvers, associate general counsel of the AFL-CIO.

Securities industry lobbyists claim the changes they want won't hurt pension plans. Instead, they say, new rules would actually save money for employers and pensioners. New York Senator Chuck Schumer, a Democrat with strong support on Wall Street, is pushing to add the financiers' wish list to a pension bill the Senate is likely to approve in early October. Some items on the list are already in pension-reform legislation awaiting final House approval.

>>


Oh, man! Does this remind anyone of Long-Term Capital Management?

[UpInArms]

102. I think that I'll need someone to

hold my hair whilst I :puke:

[AnneD]

108. I'll hold your hair for a while

if you'll hold mine. Retirement in a 3 world country is looking like a real option right about now. Here, take a sip of water afterward UIA

[UpInArms]

109. Thanks AnneD

I wish I could say I feel better now - but this seems a lot like a virus (an especially nasty one) that has infected the entire economic system.

Perhaps we should just capitulate and have a bit of this

[AnneD]

116. I prefer to have

a fortifying adult beverage too. Like the gentleman (was it JJ Astor)when the Titanic went down, "We are dressed in our best and prepare to go down with the ship like gentlemen, I'll have a brandy please....".

[UpInArms]

114. Senators resolve airline pension fight (Increased Leniency)

http://www.marketwatch.com/news/story.asp?guid=%7B740C0064%2DF7C2%2D4212%2DB496%2DFC9A96903A8A%7D&siteid=mktw

WASHINGTON (MarketWatch) -- Senators resolved a dispute over how airlines would fund their defined-benefit retirement plans, but prospects for a broad pension-overhaul bill remain cloudy, Senate Finance Committee Chairman Charles Grassley said Wednesday.

The bill, designed to address concerns about the viability of the nation's corporate pension system, would institute tougher funding rules for single-employer defined-benefit plans. The package is a compromise between bills passed earlier this year by the Senate Finance Committee and the Senate Health, Education, Labor and Pensions Committee.

The package contained a break for Northwest Airlines (NWACQ: news, chart, profile) and Delta Airlines (DAL: news, chart, profile) , both of which recently filed for Chapter 11 bankruptcy protection, by allowing them to make up their pension funding gap over 14 years, twice the amount of time that companies in other industries would receive.

That drew objections from Continental Airlines Inc. (CAL: news, chart, profile) and AMR Corp. (AMR: news, chart, profile) , the parent of American Airlines. They charged that they would be left at a disadvantage as they attempted to preserve their pension systems.

Sen. John Cornyn, R-Texas, placed a hold on the legislation, and demanded that the break for Northwest and Delta either be dropped or extended to all airlines. In the end, negotiators agreed to give American and Continental "some leniency" in funding their pension plans, Grassley told reporters, without providing details.

...more...

I think I'm going to need something stronger than the wine :(

[ozymandius]

136. This is everything these whores wanted to do to Social Security.

Easy dumb money is all they want. Any way they can get it. Your pension deduction is taken out of your gross to be used in whatever fashion the corporation sees fit. Your future welfare is the last consideration.

Fuckers.

[UpInArms]

103. 1:41 EST staying with the theme of the day

Dow 10,391.97 -49.14 (-0.47%)
Nasdaq 2,123.34 -16.02 (-0.75%)
S&P 500 1,207.11 -7.36 (-0.61%)
10-Yr Bond 4.356 -0.20 (-0.46%)

NYSE Volume 1,502,395,000
Nasdaq Volume 1,201,701,000

1:30 Little has changed for the stock market, and the indices remain relatively still... Following the morning's ISM data, the U.S. dollar has fallen for the first day in four versus the euro and has weakened against the yen. The report, which has sparked growth deceleration concerns after showing that growth within U.S. service industries was the slowest in more than two years, stunts the buck's four-week rally that pushed it to a four-month high against the euro. However, the dollar remains on track for its fifth consecutive weekly gain against the euro, a first since January of 2001... ..NYSE Adv/Dec 750/2393. ..NASDAQ Adv/Dec 687/2202.

1:00 Range-bound underwater trading persists... The Consumer Discretionary sector stands as one of five chalking losses that meet or exceed 1% today, but, of those, it's declined the least. Restaurants are largely responsible, serving as a crutch and as one of the S&P's strongest areas on the back of a reassuring report from Yum! Brands (YUM 49.42 +1.15). Ahead of this morning's bell, Yum! Reported Q3 (Sep) earnings that beat analysts expectations by a penny and delivered strong Sept. comparative store sales results while simultaneously offering in-line Q4 and FY05 guidance. Yum!'s 2.4% rise has also directed some attention to its peers, as McDonald's (MCD 39.21 +0.03) sports a modest gain while Darden (DRI 30.13 +0.40) is up 1.4% and Wendy's (WEN 47.31 0.59), despite its disappointing comps reported this morning, has risen 1.3%. ..NYSE Adv/Dec 706/2409. ..NASDAQ Adv/Dec 664/2220.

12:30 While sector standing remains static and the indices hover around lows of the day, the Financials sector, with its 0.02% loss, demonstrates relative strength and currently fares best as it sits just below the unchanged mark. Aside from 0.9% gains in bellwethers American International Group (AIG 61.74 +0.58) and American Express (AXP 50.25 +0.44), Freddie Mac's (FRE 57.66 +2.10) 3.4% surge lends some solid support. For its part, the thrifts and mortgage mainstay announced a $2 bln share buyback today, spurring positive comments from UBS and countering the effect of its announcement this morning that it expects to incur $150-300 mln in Q3 Katrina and Rita-related losses... AIG and AXP, meanwhile, remain two of the Dow's brightest spots and help limit the bluechip average's downside... ..NYSE Adv/Dec 636/2456. ..NASDAQ Adv/Dec 594/2253.

[UpInArms]

111. 2:15 EST fairies sighted on the floor

Dow 10,408.91 -32.20 (-0.31%)
Nasdaq 2,123.90 -15.46 (-0.72%)
S&P 500 1,207.17 -7.30 (-0.60%)
10-Yr Bond 4.357 -0.19 (-0.43%)

NYSE Volume 1,636,490,000
Nasdaq Volume 1,300,748,000

2:00 ET Dow -53.92, Nasdaq -17.90, S&P -8.06
Without a catalyst to spur further selling or to usher buyers to the table, stocks remain static... The prevailing bearishness amid today's market has not been limited to the U.S. indices, which, in fact, currently outperform European counterparts. Coming off of a three-year high, Europe's Dow Jones Stoxx 600 Index fell on account of declines in oil and mining companies, which have been its best performers for the year. Meanwhile, the British FTSE chalked a 1.2% loss, while Germany's DAX and France's CAC lost 1.3% and 1.2%, respectively... On the Asian front, China's Hang Seng fell 1.4%... The current 0.7% decline in the United States' S&P 500 places behind only Japan's Nikkei 225, which closed with a 0.4% loss... ..NYSE Adv/Dec 753/2451. ..NASDAQ Adv/Dec 749/2157.

[UpInArms]

113. 3:04 EST returning to the theme for the day - fairies having left

Dow 10,379.16 -61.95 (-0.59%)
Nasdaq 2,118.00 -21.36 (-1.00%)
S&P 500 1,203.97 -10.50 (-0.86%)
10-Yr Bond 4.361 -0.15 (-0.34%)

NYSE Volume 1,888,633,000
Nasdaq Volume 1,488,414,000

(adding blather on edit)

15:00 ET Dow -65.62, Nasdaq -21.27, S&P -10.66
The market's majors head back to session lows as traders digest the latest Fed speak - comments from Kansas City Fed President Hoenig that further underpin inflation fears... The Dow Jones Industrial Average is bogged down by two losses to every gain, with Caterpillar (CAT 56.75 -1.03), General Motors (GM 28.70 -1.38), and Hewlett-Packard (HPQ 27.76 -0.79) exerting the strongest downward pressures. General Motors' decline is perhaps due to reports that Delphi may declare bankruptcy as early as this week, unless GM and the UAW union agree to what would be a multibillion dollar bailout, while Hewlett-Packard has been sent south after CEO Mark Hurd rejected calls to spin of the company's printer arm... ..NYSE Adv/Dec 741/2474. ..NASDAQ Adv/Dec 728/2216.

14:30 ET Dow -32.42, Nasdaq -15.50, S&P -6.40
The Financial sector (+0.4%), which edged out of the red this afternoon, has notched higher largely through a 1.4% gain levied by its insurance brokers group... In particular, Marsh & McLennan (MMC 30.33 +0.38) and Aon Corp. (AOC32.65 +0.63) lend 1.3% and 2.0% respective gains that extend those chalked yesterday upon analyst upgrades and add to the sect's 5.5% year-to-date rise. The sector houses several other late-day bright spots that collectively offset weakness in REITs (-1.4%) and regional banks (-0.2%)... While modest, the influential sector's rise has helped the major averages pare some of today's losses... ..NYSE Adv/Dec 758/2433. ..NASDAQ Adv/Dec 752/2170.

[UpInArms]

115. 3:21 EST deeper into the red

Dow 10,357.22 -83.89 (-0.80%)
Nasdaq 2,112.47 -26.89 (-1.26%)
S&P 500 1,201.74 -12.73 (-1.05%)
10-Yr Bond 4.361 -0.15 (-0.34%)

NYSE Volume 1,996,245,000
Nasdaq Volume 1,571,637,000

[UpInArms]

119. 3:41 EST DOW down 100+

Dow 10,340.97 -100.14 (-0.96%)
Nasdaq 2,108.91 -30.45 (-1.42%)
S&P 500 1,199.15 -15.32 (-1.26%)
10-Yr Bond 4.361 -0.15 (-0.34%)

NYSE Volume 2,169,532,000
Nasdaq Volume 1,712,292,000

3:30PM: The indices continue to carve out fresh lows as each of the sectors dig deeper... The market's internals, heading into the close, reveal that the day's bearish bias has not only prevailed, but strengthened. Currently, decliners on the Big Board outpace advancers 25-to-7; at the open, decliners had a 7-to-18 edge. On the Nasdaq, declining issues currently outnumber advancing counterparts 23-to-7, up from a 2-to-1 early advantage...NYSE Adv/Dec 693/2540, Nasdaq Adv/Dec 688/2281

[UpInArms]

121. NASDAQ COMPOSITE IN DANGER OF BIGGEST ONE-DAY DROP IN 5 MTHS

3:45pm 10/05/05 <$COMPQ> NASDAQ COMPOSITE IN DANGER OF BIGGEST ONE-DAY DROP IN 5 MTHS

3:43pm 10/05/05 <$COMPQ> NASDAQ COMPOSITE DOWN 31 PTS AT 2,108

3:42pm 10/05/05 <$SPX> S&P 500 INDEX DOWN 15 PTS AT 1,199

3:42pm 10/05/05 <$SPX> S&P 500 INDEX DROPS BELOW 1,200 FOR FIRST TIME SINCE JULY 8

3:39pm 10/05/05 <$INDU> DOW INDUSTRIALS LAST TRIPLE-DIGIT LOSS WAS SEPT. 21

3:37pm 10/05/05 <$INDU> DOW INDUSTRIALS DOWN 105 PTS AT 10,336

[Changenow]

124. No end of day bounce.

CNBC will report tomorrow is the day for bargain hungers to go wild.

[UpInArms]

134. which way will the lemming go

[JNelson6563]

125. Ok, who else saw this coming?

I saw the "fairies on the floor" this afternoon and knew they would soon be chased off. I figured it would be as ugly as yesterday, didn't realize it would be even worse.

Of course lots of spin, simple profit taking and a little correction action. I think reality is setting in but hey, that's just me.

Julie

[UpInArms]

133. could be the fear factor

no one wants to hold stocks on Wednesdays now

:D

[ozymandius]

137. ha ha ha

:rofl:

Used to be that no one wanted to hold stocks over the weekend. Now am I to assume that stocks are tacky burdens during mid-week?

Hardy-har-har!

[UpInArms]

126. closing numbers and blather

(wow! check out the volume on the DOW)

Dow 10,317.36 -123.75 (-1.19%)
Nasdaq 2,103.02 -36.34 (-1.70%)
S&P 500 1,196.39 -18.08 (-1.49%)
10-Yr Bond 4.361 -0.15 (-0.34%)

NYSE Volume 2,498,544,000
Nasdaq Volume 1,961,101,000

For the second consecutive session, the major averages closed at their worst levels of the day amid more worries about inflationary pressures, as broad-based selling efforts closed all ten economic sectors with losses. Stocks picked up where they left off yesterday following Dallas Fed President Fischer's hawkish commentary - opening lower amid concerns that inflation will pick up in the aftermath of Katrina and Rita and echoing uncertainty about when the Fed will finally reach its so-called "neutral rate."...

Late-afternoon commentary from Kansas City Fed President Thomas Hoenig, which contained the usual "solid growth" item and referenced a strong economy that is flexible enough to withstand the hurricanes, failed to alleviate such beliefs...

Adding insult to injury, a higher than expected jump in the prices paid component of the ISM services index, which rose to a record high of 81.4 from 67.1, merely exacerbated inflation fears, countering a headline ISM index read of 53.3 (consensus 60.0) which in turn brought into question the pace of economic growth...

A disappointing EIA report further hampered sentiment. Traders learned that the decline in distillates (i.e. heating oil) checked in more than two times greater than expected, while gasoline inventories dropped 4.38 mln barrels (consensus -3.0 mln barrels) following a few weeks of better than estimated reports. Devoid of leadership, Energy's 3.4% decline - fueled by a less than expected drawdown in crude supply (-246K barrels vs. -1.7 mln barrel consensus) that shaved oil's price tag and gave investors reason to lock some of the sector's 34.4% year-to-date gain - served as the weightiest force today. Crude's reversal, though, did nothing to help the inflation-fixated market - not even the Consumer Discretionary sector, which faced the pressure of homebuilders' extended consolidation, losses in retail ahead of tomorrow's same-store sales data, and weakness in autos. General Motors (28.64 -1.43) was up nearly 1.0% in early trading amid reports that it was near a deal with the UAW that could save GM $1.0 bln in annual health-care costs, but spiraled intraday upon reports that its primary parts supplier - Delphi (DPH 2.50 -0.28) - may file for bankruptcy as early as this week. A research note from Goldman Sachs that challenged the likelihood of such a UAW concession served as an additional shove...

Restaurants, however, were one of the day's brightest spots, as a reassuring fiscal Q4 earnings report, strong Sept. comps, and in-line guidance from Yum! Brands (YUM 48.80 +0.53) helped limit the downside...

The Materials sector checked in just behind Energy on the laggard list amid Phelps Dodge's (PD 128.33 -6.17) 4.6% plunge following an analyst downgrade that roiled the sector and intensified wide-spread selling; the sector slid 2.3%...

A fiscal Q4 profit warning form ADC Telecommunications (ADCT 19.61 -3.06), by which the company nearly halved its earnings outlook, sent its shares reeling over 13%, and teamed with Mercury Interactive's (MERQE 31.59 -5.31) plummet to toss the sector 1.4% lower. For its part, Mercury similarly cut its Q3 guidance and thereby affected a 14.4% dive. Additionally, reports that Hewlett-Packard (HPQ 27.47 -1.08) chief, Mark Hurd, has rejected calls to spin off the company's printer arm sent its shares, and the sector, further south...

In spite of modest strength in Treasuries today, the flattening yield curve continues to sit in the spotlight and provided further reason for buyers to stick to the sidelines. Apprehension ahead of Friday's employment data, not to mention the impending Q3 earnings season, also stunted buying action today...

..DJTA -1.96%. ..DJUA -3.31%. ..SOX -1.37%. ..DOT -0.94%. ..XOI -4.04%. ..BTK -4.65%. ..Nasdaq 100 -1.51%. ..S&P Midcap 400 -2.34%. ..Russell 2000 -2.73%. ..NYSE Adv/Dec 607/2661. ..NASDAQ Adv/Dec 599/2414.

[54anickel]

139. GACK!!! Big loss on big volume - I expected to come back to a down

day but, sheesh, not this bad. The Fed seems to be trying to let a little air out the bubbles, but their jaw-boning is flattening the yield curve at the same time.

Cripes, that EIA report made the last 2 week inventory reports look like LIES or perhaps just wishful thinking. Damn, looks like all the money I made today will be going into the gas tank. Here I was hoping to see a little dip at the pump.

[Changenow]

127. Rumors of Plame indictiments tomorrow

http://blogsquatters.blogspot.com/2005/10/breaking-plame-case.html

Wall Street may have heard them also.

[UpInArms]

132. I'll keep my

[BurgherHoldtheLies]

128. Faux cheerleaders using the 'R' word. Uh oh!

Happened to stop briefly on that Cavuto show on Faux. Usually he and his cast of cheerleaders say 'buy, buy, buy' and 'the economy is GREAT'. But, today, EVERY single one of his guests were using the word RECESSION. They were pushing to buy foreign stocks...India, South America, etc.

If the head cheerleaders on Faux can't even fake enthusiasm, it's time to batten down the hatches.:scared:

[ozymandius]

135. Dang! Looks like I missed the party, showed up for the mess.

Recession here we come. I know that word has been used before in so many meaningless ways. But the name feels suited to our situation.

We were out school shopping this afternoon. During our travels, we noticed people were lining up to pay $3.10/gal for regular gas. Many stations offered the golden elixir for $3.20/gal. Too many stations had no gas. Lots of behemoths prowled the roadways. Knowing what I have gleaned from this board - I must have witnessed quite a few SUV owners upside down on a car loan.

[AnneD]

138. Big pat on the back to all the SW thread....

Thanks for posting real numbers and news, not the rah rah crap. We have seen this on the horizon for some time. We have known what was coming. Thanks Ozy,UIA,54anickle,JT,Maeve,and all the other posters and lurkers. Can't wait to here the financial programs tonight and hear what the 'suprised' economists have to say. Hope you covered you assets.....:applause: :applause: Great job guys.

[ozymandius]

141. Thanks Anne!

Pat yourself on the back too - by the way.

:yourock:

[54anickel]

145. Bush Says Social Security Overhaul Is Stalled

http://www.latimes.com/business/la-na-bush5oct05,1,866885.story?coll=la-headlines-business

WASHINGTON — President Bush acknowledged Tuesday for the first time that his plan to restructure Social Security, once his top second-term domestic priority, was moribund because he had been unable to build public support for it.

Citing the expensive and more urgent task of rebuilding New Orleans and other hurricane-damaged regions of the Gulf Coast states, Bush said he retained "plenty, plenty" of political capital to push his agenda through Congress.

But in enumerating his short-term priorities at a nearly hourlong news conference in the White House Rose Garden, the president mentioned only the war on terrorism and the hurricane reconstruction.

"There seems to be a diminished appetite in the short term" for dealing with a Social Security overhaul, Bush said with a dash of resignation.

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