STOCK MARKET WATCH, Friday August 3

[ozymandius]

Source: DU

Friday August 3, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 538/font] LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2401 DAYS
WHERE'S OSAMA BIN-LADEN? 2113 DAYS
DAYS SINCE ENRON COLLAPSE = 2074
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

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

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

AT THE CLOSING BELL ON August 2, 2007

Dow... 13,463.33 +100.96 (+0.76%)
Nasdaq... 2,575.98 +22.11 (+0.87%)
S&P 500... 1,472.20 +6.39 (+0.44%)
Gold future... 676.60 +0.70 (+0.10%)
30-Year Bond 4.90% -0.01 (-0.20%)
10-Yr Bond... 4.75% -0.01 (-0.13%)






GOLD, EURO, YEN, Loonie and Silver

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PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

more Radical Fringe here


Read more: DU

[ozymandius]

1. Today's Market WrapUp

A Wealth of Completed Reversal Patterns Paint Bearish Picture
Cisco, Russell 2000 Market Keys
BY MARTIN GOLDBERG, CMT

From the beginning of the bull market there have been both calm and dramatic corrections, yet the market continued to march higher. Now with the market in a sharp correction, it is relevant to ask whether this correction is instead, an important top. There are two aspects to this market that suggest that it might be:

1.All time high trading volumes.
2.Important stocks have completed reversal patterns and now are in bear markets.

Tonight these completed reversals are illustrated as will be some key important charts whose near term behavior will be critical in establishing whether the market will move into new high ground or whether an important top has been seen.

-cut-

Today’s Market

The Dow rose an additional 100 points on top of yesterday’s 150 point gain. Yesterday was the initial “rally attempt” according to Investors Business Daily’s much followed market strategy method. Today’s gains, although significant, occurred just one day after the rally attempt and with less trading volume than yesterday’s suggesting that a “follow through day” did not occur today.

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

[mojavekid]

2. Reuters: Tighter credit could slow U.S. GDP growth

http://www.reuters.com/article/reutersEdge/idUSN0133451220070801

WASHINGTON (Reuters) - From subprime borrowers to lumberyards to corporate giants, tighter lending standards are starting to pinch consumer and business spending, threatening to slow already tepid U.S. economic growth.

While Treasury Secretary Henry Paulson insists credit problems stemming from a housing downturn are "largely contained," banks are increasingly leery of backing all sorts of risky loans, not just subprime mortgages for borrowers with shaky credit.

"All the hoopla about subprime has created a sense among creditors and lenders that maybe they should rethink their easy terms," said Milton Ezrati, senior economist at Lord Abbett & Co. "It means that we have what is equivalent to a Fed (interest rate) tightening going on."

Reduced spending stemming from the tighter credit terms could shave one-third of a percentage point off the U.S. economic growth rate in the short term, Ezrati estimated, though he added that more sensible lending standards would be good for the economy in the long run.

The first credit problems emerged in the home mortgage market, where lenders clamped down following a spike in subprime defaults and foreclosures. More recently there have been signs that terms are getting tougher for businesses, too.

more....

[ozymandius]

3. Today's Reports

8:30 AM Nonfarm Payrolls Jul
Briefing Forecast 150K
Market Expects 135K
Prior 132K

8:30 AM Unemployment Rate Jul
Briefing Forecast 4.6%
Market Expects 4.5%
Prior 4.5%

8:30 AM Hourly Earnings Jul
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.3%

8:30 AM Average Workweek Jul
Briefing Forecast 33.8
Market Expects 33.9
Prior 33.9

10:00 AM ISM Services Jul
Briefing Forecast 59.0
Market Expects 59.0
Prior 60.7

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

[UpInArms]

21. July NFP @ 92,000 (weak) and June rev'd downward by 6,000 to 126,000

01. U.S. July average workweek falls to 33.8 hours
8:30 AM ET, Aug 03, 2007 - 1 minute ago

02. U.S. July average hourly earnings up 0.3%, up 3.9% yr-on-yr
8:30 AM ET, Aug 03, 2007 - 1 minute ago

03. U.S. July government jobs down 28,000, retail down 1,000
8:30 AM ET, Aug 03, 2007 - 1 minute ago

04. U.S. July construction jobs down 12,000
8:30 AM ET, Aug 03, 2007 - 1 minute ago

05. U.S. July manufacturing jobs down 2,000
8:30 AM ET, Aug 03, 2007 - 1 minute ago

06. U.S. June nonfarm payrolls up rev 126,000 vs 132,000 prev
8:30 AM ET, Aug 03, 2007 - 1 minute ago

07. U.S. July unemployment rate highest since Jan.
8:30 AM ET, Aug 03, 2007 - 1 minute ago

08. U.S. July unemployment rate 4.6% vs 4.5% in June
8:30 AM ET, Aug 03, 2007 - 1 minute ago

09. U.S. July nonfarm payroll lowest since Feb.
8:30 AM ET, Aug 03, 2007 - 1 minute ago

10. U.S. July nonfarm payrolls up 92,000 vs 133,000 expected
8:30 AM ET, Aug 03, 2007 - 1 minute ago

[UpInArms]

28. Slowest growth since February; unemployment rate up to 4.6%

http://www.marketwatch.com/news/story/us-jobs-growth-decelerates-92000/story.aspx?guid=%7BEF199115%2D5E3C%2D4D5B%2DA8F3%2D45741603256B%7D&dist=MostReadHome

excerpt:

Meanwhile, payrolls in May and June were revised lower by a cumulative 8,000.

The government's separate household survey showed job losses of 30,000 in July and an 188,000 rise in unemployment.

The weak job growth could add to worries that the economy is slowing. Second-quarter gross domestic product rose to a 3.4% annual rate from 0.6% in the first quarter, but some analysts worry that the second half of the year could be much weaker.

<snip>

Manufacturing jobs declined by 2,000, with construction jobs down 12,000.

...more...

[DemReadingDU]

39. Ohio unemployment rate at 6.1%

7/20/07 - Ohio No. 2 in jobless rate, new report says

Ohio had the second highest unemployment in June, according to a report Friday by the Bureau of Labor Statistics.

Michigan again recorded the highest unemployment rate at 7.2 percent, followed by Ohio at 6.1 percent and Mississippi at 6.0 percent.

Overall, 18 states posted unemployment rates that were significantly below the U.S. rate of 4.5 percent, 7 states and the District of Columbia reported measurably higher rates, and 25 states had rates that were statistically little different from that of the nation.

Nine states reported statistically significant over-the-year jobless rate increases. The largest of these occurred in Illinois, Minnesota, and Ohio — each with a 0.7 percent point increase — and New Hampshire, with a 0.6 point increase.

http://www.daytondailynews.com/n/content/oh/story/news/business/2007/07/20/ddn072007unemploymentweb.html

[Roland99]

31. but but but....The Propangandist said the economy is doing GREAT!

[UpInArms]

32. July ISM Services @ 58.8% (below consensus) vs 60.7% in June

01. U.S. July ISM services below consensus 58.8%
10:01 AM ET, Aug 03, 2007 - 2 minutes ago

02. U.S. July ISM services 55.8% vs 60.7% in June
10:01 AM ET, Aug 03, 2007 - 2 minutes ago

[mojavekid]

4. Bloomberg: U.S. Housing Is one of History's `Biggest Bubbles,' Rogers Says

http://www.bloomberg.com/apps/news?pid=20601087&sid=alZXe8Konu6w&refer=home

Aug. 3 (Bloomberg) -- The U.S. subprime-market rout that wiped out $2.1 trillion from global share values last week has ``got a long way to go,'' Jim Rogers said.

Concern that defaults among subprime mortgages may be spilling over to other credit markets and hurting earnings and takeovers last week sent the Morgan Stanley Capital International World Index to its worst weekly drop in five years. Further losses may be in store even as shares rebounded this week, said Rogers, chairman of New York-based Beeland Interests Inc.

``This was one of the biggest bubbles we've ever had in credit,'' Rogers, who predicted the start of the global commodities rally in 1999, said in an interview from Hong Kong. ``I have been and am still short the investment bankers in America. I'm also short homebuilders.''

The MSCI World plunged 5.3 percent last week, the most since the five days ended July 19, 2002, after Countrywide Financial Corp., the largest U.S. mortgage lender, said more borrowers are defaulting on mortgages and D.R. Horton Inc. reported its first quarterly net loss in at least a decade.

more...

[ozymandius]

5. Oil prices decline to $76.57 a barrel

VIENNA, Austria - Oil prices slipped Friday on mixed interpretations of U.S. fuel stocks data. Still, perceptions that the market was undersupplied pointed to continued near-term upward pressure.

Light, sweet crude for September delivery fell 29 cents to $76.57 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe. The contract added 33 cents to settle at $76.86 a barrel Thursday.

September Brent crude dropped 15 cents to $75.61 a barrel on the ICE Futures exchange in London.

Analysts say energy investors are split over the meaning of Wednesday's weekly inventory report from the U.S. Energy Department's Energy Information Administration. The report showed crude oil stocks declined 6.5 million barrels last week, far more than the 690,000-barrel decline analysts surveyed by Dow Jones Newswires had expected.

The report also showed a steep jump in refinery activity and an increase in gasoline inventories. The build in gasoline stockpiles was particularly significant in that it comes at the height of the summer driving season.

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

[ozymandius]

6. Fight over oil tax threatens energy bill

WASHINGTON - A rebellion by oil-state Democrats over $16 billion in new taxes on oil companies is threatening to upend House Democratic leaders' plans to swiftly pass energy legislation.

House Speaker Nancy Pelosi remained confident she would have the votes to pass the energy package Friday ahead of Congress' monthlong summer recess, according to her aides. But she needs solid Democratic support to overcome staunch GOP opposition.

-cut-

Supporters of the tax provisions said the bill only would remove some tax loopholes the oil companies have been taking advantage of, including a tax break given in 2004 to promote U.S. manufacturing and another involving income from foreign oil production.

There also was intense last-minute lobbying over a proposal to require electric utilities nationwide to produce at least 15 percent of their power from renewable energy sources such as wind turbines or biomass fuels.

http://news.yahoo.com/s/ap/20070803/ap_on_go_co/energy_congress

[UpInArms]

24. Oil rises above $77 on OPEC output restraint

http://www.reuters.com/article/hotStocksNews/idUSLAU46967120070803

LONDON (Reuters) - Oil rose above $77 a barrel on Friday, close to this week's all-time high, as continued output restraint by OPEC raised concern over tighter fuel supplies this winter.

U.S. oil climbed 44 cents to $77.30 by 7:55 a.m. EDT after rising 33 cents on Thursday. Prices hit a record $78.77 on Wednesday, but fell sharply on signs of improved U.S. refinery operations. London Brent rose 16 cents to $75.92.

"People are concerned about overall crude and product stocks globally, as demand's still strong," said Gerard Rigby of Fuel First Consulting in Sydney.

"Plus there are funds buying, keeping prices bullish."

Top consumer the United States is worried that as refiners crank up, crude stocks will drain rapidly and tighten supplies.

U.S. Energy Secretary Sam Bodman on Thursday warned that oil prices have placed the world's largest economy in a "danger zone." He urged OPEC to raise output when it meets in September.

...more...

[mojavekid]

7. FT: Italy to use gold reserves to cut national debt

http://www.ft.com/cms/s/1a0466f6-3ffd-11dc-9d0c-0000779fd2ac.html

Part of the gold and currency reserves of the Bank of Italy will be used to attack Italy’s enormous national debt, currently the equivalent of 107 per cent of GNP, according to a resolution approved by parliament on Tuesday as part of Romano Prodi’s coalition government’s “Document of Economic and Financial Programming” for 2008-2011, the basis for the 2008 budget legislation which must be approved within 2007.

The resolution commits the government to “Undertake, also in its relations with the European Union, a survey of all instruments useful to producing a significant reduction of the national debt, through agreed ways of using the reserves of the central banks, in gold and currency, in excess of that required by the agreement with the ECB for the defence of the Euro.”

The wording suggests that Italy’s government would try to re-think at EU level the existing limitations on the use of the gold and currency reserves of Europe’s central banks.

snip...

The Bank of Italy has €37,970m worth of gold and the equivalent of €21,026m in foreign currency, mostly US Dollars and Sterling, with smaller amounts in Yen and Swiss Francs. Some of this, however, under an agreement with the ECB, must be retained in case there is a need to intervene to defend the Euro.

snip and Yikes!...

Professor Pianta also said that “The very idea of having gold reserves is left over from the 19th century. In practice a currency as strong as the Euro has no need for gold reserves, which could be better used as investments to further strengthen Europe’s economy.”

more....

[mojavekid]

9. Mogambo Guru: Negative Inflation: Courtesy of Coke Chocula

http://www.kitco.com/ind/Daughty/aug022007.html

am nervously looking through the periscope of the Mogambo Bunker Of Ultimate Defensive Posture (MBOUDP), currently outfitted with the optional Awesome Offensive Capabilities Package (AOCP), and I am surveying the smoking carnage in the financial landscape bemusedly.

Investors who are still sitting on their stocks apparently have a Big Undying Belief (BUB) in the ability of the Fed, Wall Street and the Plunge Protection Team (that was created by an Executive Order issued by President Ronald Reagan to "manage" any stock market "surprise") to keep the markets from falling, or are very stupid, or are all playing with someone else's money, or are whacked out on drugs either prescription, over-the-counter or illegal (or all three at once), or something even more bizarre, like believing in the complete absence of counter-party risk in the hedge "insurance" provided by buying enormous amounts of mysterious derivatives at huge degrees of leverage.

And stockholders are screwed anyway, because even if everybody sells all their stocks, where in the hell do they put all that money? They have to put it into bonds, just because there is no other market so big that it can absorb so, so, so damned much money! And central banks of the world are making more money and credit all the time, too, to add to the pressure!

Thus the yield on all U.S. Treasury debt fell to less than 5% last week when the stock market sold off and all that money went into bonds. This "flight to the safety of U.S. bonds" is a Very Poor Move (VPM) because, thanks to Shadowstats.com, we know that consumer price inflation (as measured by the old-fashioned way of measuring the increase in consumer prices) is running at around 10% (or more!) right now!

So, by buying bonds, these yahoos are getting a nominal yield of less than half of the rate of inflation? Out of which they have to pay a lot of taxes, commissions, fees and expenses, so that they actually end up losing money at a rate that is nearly triple - TRIPLE! - the bond yield that they are buying? Hahahaha! What morons!

This is the modern way to "make money"? They think that they are making money by literally losing three times as much purchasing power as they are making? Hahahaha! This is the best that "investment professionals" can do? Hahahaha! We're freaking doomed! And your retirement account is in the hands of these guys? Hahaha! YOU'RE freaking doomed!

Okay, okay, I admit that is not really fair, as federal rules require that they remain fully invested, and that means that they can't sell even if they wanted to, which gets back to the absolute arrogance and stupidity of the people we elect to Congress (except Ron Paul) who made these laws, and the average American idiots who, even knowing this, keep putting their money into these investments! Hahahaha!

plenty more...

[JNelson6563]

45. I love Mogambo!

He makes economics fun! (HMEF) :toast:

[ozymandius]

8. House OKs prescription drug imports

WASHINGTON - The House passed legislation Thursday effectively permitting the importation of lower-cost prescription drugs from places such as Canada, Australia and Europe.

The move came as lawmakers passed a $91 billion spending measure funding farm subsidies and nutrition programs for the budget year beginning Oct. 1.

The bill, passed by a 237-18 vote, faces a promised veto from President Bush over its price tag, and the administration also opposes the drug importation provision.

The sprawling measure is the final domestic spending bill to pass the House. It contains almost $1 billion more than requested by Bush. But the overall measure is more than $10 billion below comparable costs for the current budget year because it does not contain farm disaster aid and reflects lower crop subsidy costs due to the good farm economy.

The administration "strongly opposes" the drug provision, which would effectively permit individuals, wholesalers and pharmacists to import lower cost U.S.-made and FDA-approved prescription drugs from Canada and other countries.

http://news.yahoo.com/s/ap/20070803/ap_on_go_co/congress_spending

[ozymandius]

10. Good morning everyone.

:donut: :donut: :donut:

My time is short here this morning. Though it is possible that I could return before the markets close - today's work schedule leaves that wholly uncertain.

Have fun today. Intuition tells me that we'll see some acrobatics.

Ozy :hi:

[cornermouse]

11. Question.

The stock market is illogical recently. There appears to be no reason for it to go up, especially the meteoric rise, and lots of reasons for it to drop like a rock. Do you know what's going on? I keep thinking "if it looks too good to be true..."

[skids]

14. Index it to the value of the dollar...

...and it looks a bit more sane. A bit. Still crazy as hell.

[DemReadingDU]

40. Illogical to me too

However, if you are a large institution, the market is great.

From Wikipedia...
Many years ago, worldwide, buyers and sellers were individual investors, such as wealthy businessmen, with long family histories (and emotional ties) to particular corporations. Over time, markets have become more "institutionalized"; buyers and sellers are largely institutions (e.g., pension funds, insurance companies, mutual funds, hedge funds, investor groups, and banks).
http://en.wikipedia.org/wiki/Stock_market

and this tidbit:
institutions are now responsible for 90 to 95 percent of trading
http://www.investmenthelp.org/insight/article.aspx?ArticleID=7&Mode=screen


So in my opinion, the institutions are pumping up the market. I fear that one day the institutions will take their profits and stash them in a secret Swiss bank account, then the markets will tank to nothing, and we small investors will be left zilch. Just my 2 cents.

[UpInArms]

12. dollar watch

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

Last trade 80.741 Change +0.069 (+0.09%)

July Non-Farm Payrolls: Will it Hurt or Help the US Dollar?

http://www.dailyfx.com/story/topheadline/July_Non_Farm_Payrolls__Will_it_1186082740922.html

This Friday, we are expecting July Non-farm payrolls and now more than ever, the stability of the US economy hinges on the strength of the labor market because non-farm payrolls could easily make or break it for the US dollar. Over the past few weeks, we have heard nothing but bad news out of the US economy including major losses reported by hedge funds and mortgage lenders, blocked withdrawals and the threat of bankruptcies. (Info on how to trade Payrolls With the EUR/USD )

Risk aversion has skyrocketed and the world has been pushed into a global credit crunch. The only thing that can bring back optimism and revive carry trades is a report of strong job growth in the month of July. Unfortunately the divergences in the leading indicators for non-farm payrolls make it very difficult to figure out whether non-farm payrolls will be strong or weak. We also typically get service sector ISM before NFPs, but this month, it comes after the release. In an environment where the US economy is becoming increasingly vulnerable, even if the jobless claims figures indicate that companies are not firing, they may not be hiring either. Economists are currently calling for payrolls to increase by 127k, after rising 132k the prior month. Forecasts range from a low of 60k to a high of 178k. The recent rebound in the US stock market and the market’s overall risk appetite suggests that traders may be holding out the hope for a stronger number. Let’s take a look at the possibilities of that scenario:


What US Dollar Traders Should Watch

In order for non-farm payrolls to be dollar positive, we may simply need to see job growth in excess of 110k. The hope is that as long as companies are still hiring, consumer spending could rebound after having fallen 0.9 percent last month. The labor market is the backbone of the US economy and weak job growth poses a big threat to consumer spending. We are already hearing reports of late credit card payments and increased delinquencies. If the labor market buckles as well, retail sales this month could be in serious trouble. The market is already pricing in a 100 percent chance of an interest rate cut by the end of the year. At this moment, the Federal Reserve is still holding onto its hawkish inflation bias because inflationary pressures remain a concern. However if NFP is weak, they may have to recognize what the market has already decided for them, which is the need to consider loosening monetary policy at the end of the year. On the other hand, if payrolls are very strong, we could see a further recovery in both the Dow and carry trades. Also watch for revisions to the June figure because we have seen revisions to prior payroll numbers exacerbate or negate the surprise in the headline number. If both the headline and revised number turns out to be dollar negative however, then market watchers will pounce on the idea of sharply slower consumer spending and growth this quarter.

...more...

US Dollar: Stocks Surge, But Yields Fall, Subprime Problems Not Over Yet

http://www.dailyfx.com/story/bio1/US_Dollar__Stocks_Surge__But_1186089704416.html

The hope for a strong non-farm payrolls report tomorrow has helped keep equities, carry trades and USD/JPY in positive territory for most of the US trading session. Buying on the close is soon becoming a new trend in the stock market as the Dow surged up 100 points in the last half hour of trading. Even volatility has pared back with the VIX index falling 2 points today. This has helped carry trades, which thrive on a lower volatility environment to rebound, but the lack of a similar rally in bond yields suggests that not everyone believes that the worst is behind us. Like Fed President Poole, Kroszner indicated that the Fed has an “important role to play in responding to and mitigating the impact of financial crises and shocks.” Nominees for the Federal Reserve Klane and Duke both blamed the Fed for not preventing some of the sub-prime problems by acting sooner. Subprime indices continue to fall amidst warnings from Accredited Home lenders that they may not be able to continue operating. The rebound in the stock market does not mean that risk appetite has returned. Instead traders are dying for a piece of good news. Today’s drop in jobless claims brings the four week moving average of claims down to 305.5k from 309k. The last time average claims were this low was back in May and that month, 190k jobs were added to US payrolls. Although we could see a firm number, this same degree of strength is not likely to happen given the fact that retail sales dropped in the month of June, the ADP employment report slipped to a 4 year low, Challenger reported a 15 percent increase in layoffs and the number of both online and paper job ads. At the same time however, payrolls may not be abysmal given the jump in consumer confidence last month. Economists are currently calling for payrolls to increase by 127k, after rising 132k the prior month. Forecasts range from a low of 60k to a high of 178k. For more on whether July Non-Farm Payrolls Will Hurt or Help the Dollar, see our Special Report. A weak number will probably drive a bigger movement in the dollar than a strong number since August will be a tough month for not only the US economy as a whole, but also the labor market. In addition to NFPs, we are also expecting service sector ISM tomorrow.

...more...

[UpInArms]

13. Bear hedge fund sank as Merrill protected clients

http://news.yahoo.com/s/nm/20070803/bs_nm/bearstearns_hedgefunds_dc

NEW YORK (Reuters) - A late June move by Merrill Lynch & Co. Inc. (MER.N) to protect its clients from a struggling hedge fund run by Bear Stearns Cos. Inc.

Recently filed court documents in U.S. Bankruptcy Court in Manhattan reveal more details about the events that led to the collapse of two hedge funds run by Bear Stearns.

For example, the Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Fund started performing poorly in early 2007, court papers show.

By late May, the enhanced fund had begun to suffer significant devaluation of its asset portfolio, resulting in a number of margin calls.

About June 20, Merrill Lynch issued a bid list to some of its clients and then sold off some of the assets that were in the enhanced fund, court papers show.

...more...

[UpInArms]

15. US says mortgage woes unlikely to affect broader economy

http://news.yahoo.com/s/afp/20070803/bs_afp/apecaustraliausstocksfinance

COOLUM, Australia (AFP) - The credit crunch in the US that has rocked global stockmarkets this week is unlikely to impact on the broader US economy, US Deputy Treasury Secretary Robert Kimmitt said Friday.

Kimmitt said adjustments in the US sub-prime mortgage market would take "some quarters" to resolve but were proceeding in an orderly fashion.

"We continue to monitor closely both the sub-prime market and in particular the credit markets more broadly," Kimmitt told reporters at a meeting of APEC finance ministers in the northern Australian town of Coolum.

"What we see now is a reassessment and repricing of risk which we believe is proceeding in an orderly fashion and therefore the effects on the overall US economy appear to be contained, based on the fact that we have a very healthy, diverse economy operating within a strong global economy."

Kimmitt said there was still "softness" in the US housing market, adding "that's going to take several quarters probably to work its way through".

Global stockmarkets have been roiled by concerns about the US sub-prime home loan market but have steadied as US finance and banking chiefs try to reassure spooked investors.

"We think the underlying fundamentals of both the global economy and the US economy are permitting this current set of adjustments not to have an effect more broadly," Kimmitt said.

...more...

and for those who don't know who Kimmitt is - he is the brother to the general that said:

The Marines and coalition officials say they doubt many civilians have been killed in Fallujah and promise that their rules of engagement limit civilian casualties. "My solution is change the channel," Brig. Gen. Mark Kimmitt said earlier this week, after being asked about TV images of dead Iraqi civilians.

[Roland99]

50. Will government bail out mortgage market?

Will government bail out mortgage market?
Congress, Fannie and Freddie might provide only limited help

http://www.marketwatch.com/news/story/any-bailout-home-loan-mess-would/story.aspx?guid=%7B07CF1D1D%2DC6E1%2D4A01%2DAEE8%2D30CD0B81D772%7D

SAN FRANCISCO (MarketWatch) -- The crisis in the mortgage market has increased the likelihood that the Federal government could intervene in some way to alleviate a credit squeeze.

However, Congress and government-sponsored enterprises like Fannie Mae and Freddie Mac might only offer limited support.
Some parts of the secondary mortgage market have ground to a halt in recent days as investors shun many types of mortgage securities that don't conform to Fannie and Freddie's standards.

A broker at Ace Mortgage Funding LLC, a leading mortgage brokerage firm, estimated on Friday that 90% of these so-called non-conforming home loans have disappeared in the past three days, leaving home buyers with far fewer options. The broker declined to be identified because they didn't want to be seen as exacerbating housing market problems.

The crisis in mortgage availability could prompt action from Congress, several mortgage market experts said.

[Demeter]

64. You Mean Print More Paper?

Just how fast do you think those presses can go? They're smoking already!

[UpInArms]

16. American Home Mortgage to close Friday - 7,000 now without jobs

http://www.reuters.com/article/businessNews/idUSN0245508920070803?feedType=RSS

NEW YORK (Reuters) - American Home Mortgage Investment Corp. plans to close most operations on Friday and said nearly 7,000 employees will lose their jobs as the lender becomes one of the biggest casualties of the U.S. housing downturn.

Experts said it is likely the Melville, New York-based company will have to seek bankruptcy protection, and no later than Monday.

In a statement, American Home on Thursday night confirmed earlier reports that it was ceasing most operations. The company said its employee base will be reduced to about 750 workers, down from the 7,409 it reported at the end of last year. The terminations are effective Friday.

American Home originated $59 billion in loans last year, and mostly to people with better credit than risky subprime borrowers. About half of those mortgages were adjustable-rate loans, whose defining feature is an interest rate that can be adjusted upward.

"It is with great sadness that American Home has had to take this action which involves so many dedicated employees," Chief Executive Michael Strauss said in a statement.

...more...

[UpInArms]

23. American Home down 47% to $0.75 in pre-open trading

02. American Home down 47% to $0.75 in pre-open trading
8:43 AM ET, Aug 03, 2007 - 2 minutes ago

[UpInArms]

30. more info:

http://www.marketwatch.com/news/story/american-home-mortgage-lay-off/story.aspx?guid=%7B4296631D%2DF768%2D4699%2D95D3%2D71A904976E21%7D

excerpt:

American Home, and peer Accredited Home Lenders (LEND), have faced huge
selling pressure this week as the companies struggle to survive amid the turmoil in the subprime mortgage market, which caters to less-creditworthy home buyers.
Subprime delinquencies have jumped as house prices slide, pressuring lenders who offered the loans.

The originators of the loans are being forced to buy back loans they had sold in the second mortgage market, creating a negative cycle of events that has grown worse.

Forced repurchases increased the amount of distressed mortgage loans for sale in the market, which dented prices.

That, in turn, caused the big banks that provide crucial financing for mortgage originators to mark down the value of mortgages held as collateral to back their loans, Accredited said.

That triggered margin calls, or demands for more cash or collateral, on many subprime lenders including American Home.

...more at link...

[Gregorian]

42. Ah. Thanks. Now I'm seeing the picture clearly. Good info.

[AnneD]

68. I was listening to Market Report on NPR....

They were talking about Mortgage Companies that were not even in the sub prime market taking a hit. This is how the domino effect of the S&L hit Houston. Many good S&L folded on the repurchase of homes in distressed markets. Credit to buy homes-even with great credit was difficult and expensive. It took years to reabsorb those homes and office space-and that was with an improving job market.
But the thing that scared me the most-aside from the time it would take to recover was the fact that the announcer used the R word (recession). Now this is a fairly mainstream radio show. I think folks are starting to wake up.

[Eugene]

55. Connecticut issues order against American Home Mortgage

Source: Associated Press

Connecticut issues order against American Home Mortgage

1:38 PM EDT, August 3, 2007

HARTFORD, Conn. (AP) _ State banking officials issued a temporary
cease and desist order Friday against American Home Mortgage Corp.
of New York and two of its affiliates for possible violations of
mortgage banking laws.

The order requires American to stop failing to fund loans on time,
cooperate with the investigation and comply with agreements with
borrowers.

The company could face a fine of up to $1 million, banking officials
said. American did not transfer loan proceeds for 38 loans scheduled
to close in Connecticut, regulators said.

"My primary responsibility is the protection of Connecticut consumers,"
said Howard F. Pitkin, state banking commissioner. "Therefore, in
addition to issuing this order which requires the company to cease all
business activities, I have also ordered American to create a separate
escrow account containing all fees that consumers paid to the company,
in order to reimburse those consumers whose mortgage loans did not
close."

-snip-

http://www.newsday.com/news/local/wire/connecticut/ny-bc-ct--americanhomemortg0803aug03,0,4938333.story

[UpInArms]

17. Business as usual for Mattel in dusty south China

http://www.reuters.com/article/topNews/idUSPEK28220070803?sp=true

UANYAO, China (Reuters) - Thousands of young Chinese toymakers dressed in pink and blue Mattel T-shirts spill from the U.S. toy goliath's factories in Guanyao after an 11-hour overnight shift, as the dawn shift took their place.

Street hawkers on motorbikes sell warm soy milk, steaming buns and noodles to the throng wanting a quick snack before heading back to their crowded dormitories.

"I'm so exhausted I could die," said a 19-year-old worker from Hunan who had spent the night attaching hair to "3,000 (Barbie) dolls" in her factory. Her six-day working week earns her around 1,000 yuan ($132) a month, far more than she would earn at home.

Mattel Inc. is recalling 1.5 million Chinese-made toys worldwide because their paint may contain too much lead -- the latest in a deluge of product safety scares that have tainted the "made in China" brand.

The toys, made for Mattel's Fisher-Price unit and including popular characters like Elmo and Big Bird, were produced by a contract manufacturer in China using a non-approved paint pigment containing lead, Mattel said on Wednesday.

Many of the Chinese workers at the Mattel plant in Guanyao, one of about 50 Mattel plants in the country, seemed unaware of the scandal.

...more...

[UpInArms]

20. Mattel: Recall has $30 million impact

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

LOS ANGELES - Mattel apologized Thursday to customers affected by a recall nearly a million toys from its Fisher-Price division and said the move will cut pretax operating income at the world's largest toymaker by $30 million.

The plastic preschool toys were made in China with paint found to have excessive amounts of lead.

"We apologize to everyone affected by this recall, especially those who bought the toys in question," Robert A. Eckert, Mattel Inc.'s chairman and CEO, said in a statement.

"Our goal is to correct this problem, improve our systems and maintain the trust of the families that have allowed us to be part of their lives by acting responsibly and quickly to address their concerns," he said.

Mattel shares fell 40 cents, or 1.7 percent, to $23.18 Thursday.

The apology came a day after El Segundo-based Mattel disclosed the recall of 967,000 toys manufactured by a Chinese vendor and sold in the United States between May and August.

...more...

What's with this "Chinese vendor" shit? That's their Mattel plant - they make their shit in China. Mattel is not the victim here. I call bullshit.

[UpInArms]

18. Taiwan Shin Kong says exposed to U.S. subprime mkt

http://www.reuters.com/article/bondsNews/idUSTP4107320070803

TAIPEI, Aug 3 (Reuters) - Shin Kong Financial (2888.TW: Quote, Profile, Research), which runs Taiwan's No.2 life insurer, said on Friday about one third of its T$10.53 billion (US$320 million) asset-backed securities (ABS) holdings related to U.S. subprime products.

Some 37 percent of its ABS collateralised debt obligations (CDO) position was invested in the U.S. subprime market as of end of July, according to a company statement.

The firm's life insurance arm, Shin Kong Life, has T$1.17 trillion in total assets.

"All ABS CDOs held by Shin Kong Life are A-rated or above, with 26 percent in AAA, 34 percent in AA and 40 percent in A. There has been no downgrade and payments have been normal," chief financial officer Winston Yung said in the statement, without providing an estimate for potential losses.

...more...

[UpInArms]

26. AXA (Europe's 2nd largest insurer) props up funds after subprime losses

http://www.reuters.com/article/bondsNews/idUSL0362667720070803

PARIS, Aug 3 (Reuters) - Europe's second-biggest insurer, AXA (AXAF.PA: Quote, Profile, Research), said on Friday measures remained in place to prop up some of its funds after losses related to U.S. subprime mortgages caused a drop in their value.

The company's AXA IM fund management division said its two U.S. Libor Plus funds had seen their net asset value drop by around 13 percent in late July due to the subprime crisis.

AXA said it would invest its own money in the funds in order to prop up their liquidity but would allow investors to sell their holdings if they wished to do so. AXA added it had closed the funds to new investors.

An AXA IM spokeswoman said on Friday that these temporary measures remained in place for the time being.

Financial News and the Financial Times reported that the two funds had more than $700 million of assets under management.

...more...

[UpInArms]

19. U.S. Domestic Funds In July Took Biggest Hit In Two Years

http://news.yahoo.com/s/ibd/20070802/bs_ibd_ibd/200782funds01

Domestic stock funds rode a roller coaster in July, when the S&P 500 tumbled 4.9% the fourth week of the month. It was the largest one-week drop since the current bull market began in March 2003.

The index ended the month down 3.2% and 6.47% off its all-time peak of 1555.90. As of Thursday, it's up 3.7% year to date.

For the month, U.S. diversified stock funds fell 3.4%, according to Lipper. It was the biggest one-month decline since April 2005 and followed a 1.15% decrease in June. The July decline left stock funds up 4.79% for the year.

Growth trumped value in all market sizes for the month and year to date.

Small-cap growth funds dropped 3.93% in July. They're still ahead 6.61% year to date. Small-cap value dived 7.04%. Meanwhile, the small-cap S&P 600 index tumbled 5.11% in July. It's up 3.3% year to date.

Mid-cap growth shed 1.99% last month, while mid-cap value sank 5.33%. They've risen 10.64% and 5.02%, respectively, year to date.

...more...

[UpInArms]

22. News Corp. pledged $2.5 mln to DJ watchdog's group

http://www.reuters.com/article/businessNews/idUSN0223284220070802?feedType=RSS

BOSTON/NEW YORK (Reuters) - Dow Jones & Co Inc said on Thursday it did not know that one of the people named to protect its editorial independence after it becomes part of News Corp runs a foundation that received a donation pledge of $2.5 million from News Corp.

Rupert Murdoch's global media conglomerate selected Massachusetts Institute of Technology Professor Nicholas Negroponte to be part of the five-member special committee that will oversee the editorial independence of Dow Jones's news operations including the Wall Street Journal.

Creation of the committee and agreement on who would be on it was part of News Corp's $5.6 billion deal to buy Dow Jones.

Asked if the donation compromised Negroponte's independence as a member of a group designed to safeguard Dow Jones' editorial integrity, Dow Jones spokeswoman Linda Dunbar said: "We are confident of the capability of the individuals to make independent decisions."

...more...

[UpInArms]

25. Weyerhaeuser second-quarter earnings tumble (home building no longer good)

http://www.reuters.com/article/bondsNews/idUSWNAS995920070803

NEW YORK, Aug 3 (Reuters) - Weyerhaeuser Co. (WY.N: Quote, Profile, Research) said on Friday its second-quarter earnings fell due to higher costs and a weak U.S. housing market.

The No. 2 U.S. timber and forest products company said net income fell to $32 million, or 15 cents a share, from $298 million, or $1.19 a share, a year earlier.

<snip>

The company's shares have fallen 16.1 percent over the last three months, tracking a 12 percent drop in the Standard & Poor's Paper and Forest Products Index (.GSPAFP: Quote, Profile, Research).

...more at link...

[UpInArms]

27. pre-opening blather

09:00 am : S&P futures vs fair value: +1.6. Nasdaq futures vs fair value: -2.0. After initially slipping to morning lows, the futures market is recovering some ground, but only enough to still suggest a flat start for equities as opposed to a lower start for both the S&P 500 and Nasdaq 100. The latter is still languishing below fair value, but that's due in part to an 18% pre-market drubbing in Network Appliance (NTAP) after it slashed guidance.

Meanwhile, investors are also trying to figure out what impact today's mixed jobs report will have on policy makers when they meet on Tuesday while also digesting the fact that the lower payrolls print presents an unclear view of the depth of any economic problems related to tightening credit standards.

08:35 am : S&P futures vs fair value: +2.0. Nasdaq futures vs fair value: -0.8. The Labor Dept. showed that only 92,000 jobs were added in July, which was below the 135,000 expected and well shy of the 145,000 average over the first half of this year. Hourly earnings rose 0.3%, matching economists' forecasts and leaving the year/year rate at 3.9%, while unemployment ticked up slightly to a 4.6% rate.

The futures market, which was catching a slight bid heading into the data, is back to exhibiting an indecisive disposition and still indicating a relatively neutral open for the cash market. Bonds are improving slightly as the yield on the 10-year note (+02/32) falls to 4.74 %.

[TrogL]

29. Loonie Watch

Hello from Harrowgate, England

It's 2:17 p.m here. I have no idea what time it is in MDT.

When I left, the loonie as at US$1.04 range. Now, apparently, it's in the $1.05 range.

What the hell did you people do to the loonie?

Don't you realize I'm on vacation and I need the loonie to be high right now?!"?!

Get it fixed!!

[AnneD]

67. Welcome to the party...

Hubby's USD are looking like the old Mexican peso. Thank God he is preforming in Germany and got some Euro's in his pockets.

[UpInArms]

33. 10:07 EST now that's going to leave a mark!

Dow 13,368.39 94.94 (0.71%)
Nasdaq 2,554.49 21.49 (0.83%)
S&P 500 1,458.26 13.94 (0.95%)
10-Yr Bond 4.743% 0.01

NYSE Volume 468,080,000
Nasdaq Volume 276,485,000

10:00 am : After recently trying to get back on track, as reflected in the S&P 500 and Nasdaq briefly inching their way above the flat line, buyers again find themselves struggling to gain traction. That's understandable though since the absence of leadership from Financials (-0.5%), which is also this morning's biggest laggard as headline risk remains high with respect to credit concerns, leaves the sustainability of the recent bounce in question.

Materials is turning in a similarly dismal performance while weakness in Discretionary (-0.4%) and Industrials (-0.3%) also removes some much needed sources of support. Health Care and Utilities are the only sectors trading in positive territory; but minimal gains in a couple of defensive-oriented sectors further underscore the sense of apprehension to own equities this morning. DJ30 -34.12 NASDAQ -9.94 SP500 -6.26 NASDAQ Dec/Adv/Vol 1251/1210/156 mln NYSE Dec/Adv/Vol 1396/1281/72 mln

09:40 am : As expected, stocks open with little fanfare as a mixed jobs report fails to get investors excited enough to extend two days of surprisingly strong gains. With the markets already nervous for any signs of a softening labor market, July payrolls checking in below expectations has been viewed in a slightly negative light even though the addition of 92,000 new jobs (consensus 135,000) translates into a 0.8% annual rate of growth. That is sufficient to keep real GDP growth at the expected growth rate of 2 3/4% for the second half of the year.

[Ghost Dog]

34. Nikkei little moved as export shares rise

http://www.ft.com/cms/s/baa3b590-4178-11dc-8f37-0000779fd2ac.html

Tokyo stocks held above Wednesday’s three-and-a-half-month low as signs that the yen’s recent rise was easing buoyed export-dependent manufacturers.

The benchmark Nikkei average closed trading on Friday almost unchanged, down 0.03 per cent at 16,979.86. The broader Topix index edged up 0.19 per cent to 1,672.54. The Japanese currency, which had strengthened to around Y118 to the dollar by midweek from around Y123 in early July, was trading near Y119.

On Wednesday the Nikkei fell 2.2 per cent to its lowest level since mid-March, hit by concerns over the strengthening yen and a brewing global credit crisis. It recovered by 0.7 percent on Thursday.

/...

[Ghost Dog]

35. Europe slips as credit woes persist

http://www.ft.com/cms/s/33142a2c-41a2-11dc-8328-0000779fd2ac.html

European equity markets surrendered early gains and moved lower by late-morning on Friday, weighed down by weakness in the oil and mobile telecoms sectors and ongoing nervousness over conditions in credit markets.

The FTSE Eurofirst 300 slipped 2 points, or 0.1 per cent, to 1,534.98 while in Germany, the Xetra Dax lost 11.7 points, or 0.1 per cent, to 7,522.96, while in Paris, the CAC 40 retreated 18.5 points, or 0.3 per cent to 5,663.6.

“Over the last month, equity markets have become innocent victims of the adjustment of credit market excesses,” said Bernd Meyer, equity strategist at Deutsche Bank: “We estimate that the repricing of credit risks has halved the number of potential LBO candidates.”

Concerns over German banks exposure to problems in the US sub-prime mortgage market continued to affect the sector.

/...

[Ghost Dog]

47. US data and subprime-related problems hurt European markets

http://mwprices.ft.com/custom/ft2-com/html-story.asp?pulse=true&siteid=ft&dist=ft&guid=%7Bfa9f774b%2D4062%2D4afe%2D9457%2Ddfaf6fd474f4%7D

European equity markets closed lower on Friday, hit by weaker-than-expected US job growth data and subprime-related problems. The FTSE’s Eurofirst 300 fell 1.3 per cent to 1,517.16. In Paris, the CAC 40 slipped 1.5 per cent to 5,597.89, while, in Frankfurt, the Xetra Dax 40 lost 1.3 per cent at 7,435.67. The downturn came as data released on Friday showed US employees boosted payrolls in July at the slowest pace since February. The 92,000 new jobs added was below the forecast of 100,000 and unemployment in the US is now at its lowest level since the start of the year. The banking sector ended a particularly woeful week with German bank IKB crashing 41.7 per cent to €12.73 since last Friday after it revealed the extent of its exposure to the subprime crisis. European real estate stocks were also hit with Hypo Real Estate losing 6.3 per cent at €41.16 on the day.

[UpInArms]

36. Bear Stearns outlook revised to negative at S&P (very very bad)

http://www.marketwatch.com/news/story/bear-stearns-outlook-revised-negative/story.aspx?guid=%7BAA827038%2D4A89%2D4BD0%2DB931%2D3E2F1EEF665C%7D&dist=MorePulse

SAN FRANCISCO (MarketWatch) -- Standard & Poor's said on Friday that it revised its outlook on Bear Stearns (BSC) to negative from stable because the investment bank's hedge fund troubles have damaged its reputation and and could hurt its performance for an extended period. The bank also has material exposure to mortgages and mortgage-backed securities, which remain under severe pressure, S&P added. In addition, the bank is exposed to debt taken on from unsuccessful leveraged finance underwritings and has other significant underwriting commitments, the rating agency said. Still, Bear Stearns' liquidity is strong and the bank should be profitable in the current quarter, S&P added. "The negative outlook reflects our concerns about recent developments and their potential to hurt Bear Stearns' performance for an extended period," said Standard & Poor's credit analyst Diane Hinton. "We believe Bear Stearns' reputation has suffered from the widely publicized problems of its managed hedge funds, leaving the company a potential target of litigation from investors who have suffered substantial losses."

[Roland99]

37. 10:40am - Triple digit losses already

Dow 13,358.79 -104.54
Nasdaq 2,556.48 -19.50
S&P 500 1,459.06 -13.14
Oil $76.55 $-0.31
10 YR 4.72% -0.03
Gold $681.00 $4.40

[UpInArms]

38. just the blather (hi Roland!)

{edited to take out the simul-post with Roland)

10:30 am : The indices are bouncing off their recent lows, but barely, as the influential Financial sector (-1.2%) being dealt yet another blow remains a large overhang. At the top of the hour, the market spiked to its worst levels of the morning when it was reported that Standard & Poor's changed its rating outlook on Bear Stearns (BSC 108.35 -7.33) to negative from stable, indicating there is a greater chance of a downgrade over the next two years.

S&P saying that recent developments, including problems at some of BSC's hedge funds, have the potential to hurt its performance for an "extended period." Shares of BSC have hit a fresh 20-month low, are now more than 37% off their mid January high, and push the Investment Banks group even further into negative territory for the year. It currently ranks as the year's sixth worst performer with a year-to-date decline of 15.4%. DJ30 -74.05 NASDAQ -15.34 SP500 -9.44 NASDAQ Dec/Adv/Vol 1755/891/378 mln NYSE Dec/Adv/Vol 2182/775/262 mln

:hi:

[Roland99]

49. y helo thar!

:toast:

[mojavekid]

41. Jim Willie: Fed Funds & Other Signals

http://www.kitco.com/ind/Willie/aug012007.html

A quick review of signals surely can be both encouraging and confusing. They point to higher physical prices, calmer stock prices, and a continued housing crisis & mortgage debacle. The big banks and Wall Street broker dealers are breaking down very badly. The USDollar bounce is already running out of steam, hampered by a restored expected interest rate cut. Remember: whatever is vigorously and repeatedly denied is almost surely to occur!!! Deception sells products. The eventual gigantic bailout will render horrendous harm to the USDollar, from both the broad infusion of phony money in redeemed mortgage bonds, but also lost credibility in the US Federal Reserve and US Dept of Treasury. Bernanke is missing action, but Paulson’s words sound downright idiotic. Will Paulson resign early, just like Rubin in 2000, to short the stock market with more liberty? For a while, gold and silver are held hostage to the admission of a required bailout and the final decision to take action. The crude oil price continues to be the path of least resistance, which signals a Petro-Dollar breakdown. These topics are discussed in depth in the upcoming August Hat Trick Letter.

FEDFUNDS FUTURES CONTRACT

The USFed will be forced into under-writing on a massive scale the bond nightmarish losses, especially since the prime mortgage market has been infiltrated. Bernanke regards the prime mortgage market as sacred, to be protected. The official rate cut would jack up the gold price and harm the USDollar. The helpful USTBond yield differential would fade. The December 2007 FedFunds futures contract factored in two 25 bpt rate cuts last February. That belief evaporated with tame doctored consumer prices and a slight rebound in the economic growth. The GDP bounce seen in 2Q2007 might not last long. Now, one 25 bpt cut is expected again with a roughly 80% likelihood. Where is Ben Bernanke in his pep talk to the markets? The hamstrung USFed has been marginalized, perhaps the weakest among all central banks.

USDOLLAR BOUNCE ALREADY TIRED

The USDollar rally as seen in the DX current basket index is one week old and probably half completed. Resistance is likely to be fierce at the 81.5 level. The profit taking for the euro, the swissie, the British sterling, the Canadian loonie, the aussie, and the Kiwi might be close to finished. Enter the bounce in the Japanese yen, with a likely interest rate hike this year. The USDollar will continually scratch at new lows with feeble bounces.

more...

[DemReadingDU]

43. Michael Nystrom: Global Liquidity Defined

Financial analysts and news reporters often refer to the concept of "liquidity," as though it were a magic wand. One touch and all ills are cured. Until recently, it was often heard that "the world is awash in liquidity," which was considered a good thing. More recently, the en vogue observation is that "global liquidity is drying up," which is spoken in ominous tones.

Liquidity and You
What is liquidity? Liquidity is simply a measure of how quickly an asset can be converted into cash. Ultimately, liquidity is cash, because cash can immediately be exchanged for just about anything else.
.
.
.
But like last week, when stocks suddenly fall, buyers disappear. Stockholders, like homeowners in Detroit, and their hedge-fund-holding brethren, want to sell, sell sell! They want to be "liquid," but buyers are only willing to buy at lower prices - much lower. "Ridiculous!" the would-be sellers might say. It is much better to wait, and sell in the inevitable rally that will follow. (Maybe the rally will even be so good that they won't have to sell at all!)

full article...
http://bullnotbull.com/bull/node/19

[OrangeCountyDemocrat]

44. I Can't Believe How Difficult It Is To Bet On A Stock Going Down

I've got all these accounts, and they have to get approved so I can bet against a stock.

If I want to go short, I need a "Margin" account, and approval is necessary. Even though I have plenty of cash to cover.

And Options. My god. If I want to buy a small amount of some stinking Puts, on a stock which I KNOW is going down, that is in fact dropping 5% each day, I have to wait 2 Weeks! Of course, by then, this "mortgage loan" company could be a penny stock.

Of course, if I wanted to go long and Buy some shares, and lose it all....that's not a problem. Frustrating.

[A HERETIC I AM]

53. Options and Margin trading accounts are subject to much higher scrutiny than regular accounts.

It is my understanding that there has been abuse as well as situations where individuals were allowed to trade options and their positions turned against them, costing the individual huge sums. Firms are forced to protect themselves as well as you. They are probably doing a full credit check on you and have to determine how much you can afford to lose, should your options or short sales go the other way.

[specimenfred1984]

56. Futures trading and ETFs

You can short them just as easily as buying them. Account minimums run anywhere from $5G to $35G. These accounts are considered highly speculative and will insist you only risk speculative money.

[A HERETIC I AM]

61. You can not risk "only speculative money" when selling short. The potential for loss is unlimited.

Since theoretically a stocks price could rise forever, when selling short the risk of loss is unlimited. The potential for gain is limited to the price of the share being shorted.

[specimenfred1984]

71. Learn how to trade futures then comment

Ever hear of futures or commodities? Geez...

[A HERETIC I AM]

72. Do you have a series 3? Series 7? Do you have any idea what those are without looking them up?

And what the hell does the post you responded to have to do with futures trading?

OrangeCountyDemocrat did not mention anything about futures or Exchange Traded Funds. He/She asked the following;

I Can't Believe How Difficult It Is To Bet On A Stock Going Down
I've got all these accounts, and they have to get approved so I can bet against a stock.
If I want to go short, I need a "Margin" account, and approval is necessary. Even though I have plenty of cash to cover.
And Options. My god. If I want to buy a small amount of some stinking Puts, on a stock which I KNOW is going down, that is in fact dropping 5% each day, I have to wait 2 Weeks! Of course, by then, this "mortgage loan" company could be a penny stock.
Of course, if I wanted to go long and Buy some shares, and lose it all....that's not a problem. Frustrating.

To which you replied;

Futures trading and ETF's
You can short them just as easily as buying them. Account minimums run anywhere from $5G to $35G. These accounts are considered highly speculative and will insist you only risk speculative money.

Which in no way addresses the situation that person mentions!
You tell this person they can short futures and ETF's just as easily as buying them. BULLSHIT! You are absolutely wrong on this point, boyo. Selling short is done on a margin account whether it is done with Stock, Bonds, ETF's, or Pork Bellies. The reason OCD has to wait is because the brokerage firm is more than likely doing a background check and a credit check as well as an income verification. Why else do you think there are minimum account balances? And even though He/She states "If I want to go short, I need a "Margin" account, and approval is necessary. Even though I have plenty of cash to cover" it is impossible to have enough cash because the potential risk of loss with selling short is unlimited. Every Broker knows this. By the way, account holder verification procedures and mandatory information gathering has INCREASED in the business as a result of the Patriot Act.

There is no speculative account you can set up that DOESN'T "risk speculative money". And anyone that is trading options, futures or using margin to buy or sell is by DEFINITION, SPECULATING! Why else is every brokerage firm in the country required to give a person wishing to trade options one of these? http://www.optionsclearing.com/publications/risks/riskchap1.jsp "Characteristics and Risks of Standardized Options Disclosure". And every single firm that opens a Margin account for someone is going to give them one of these;http://www.tdameritrade.com/forms/AMTD845.pdf But you knew that, didn't you slick?

Selling short has unlimited potential for loss if the share price increases. FULL STOP. It doesn't matter if it is a Stock, ETF or a September Pork Belly contract. Learn to fucking read. The key word is in italics.

You have about as much business giving investing advice as Bush does trying to run this country. Case in point; this little gem of yours from a few months back in response to someone who mentioned their Mutual Funds had gone down on a down day (What a shocker!):

Sorry to hear that; here's a way to mimick funds
Pick 20 stocks from different sectors with each stock having to potential to gain 15% to 20% a year. It's much easier said than done but that way you control where you money is going.

WOW. That's fucking GENIUS! Why not just do about a hundredth of the research and find a decent performing mutual fund that has had good, steady returns for 40 years?

Go dry the back of your ears, there slick. Geez...

[UpInArms]

69. Markets give short-sellers long-awaited gains

http://www.reuters.com/article/bondsNews/idUSN0336393320070803

BOSTON, Aug 3 (Reuters) - Short-sellers are hot again after five years out in the cold, fueled by a U.S. subprime mortgage crisis that could extend their run of healthy returns for months to come, industry experts said on Friday.

Jim Chanos of Kynikos Associates, among the most prominent short-sellers, has been short on Australia's Macquarie Bank (MBL.AX: Quote, Profile, Research) and his call has paid off handsomely. The stock slid 10.7 percent on Wednesday after unveiling likely losses of up to 25 percent in two funds exposed to the U.S. subprime crisis.

And Friday's 7 percent slide in MBIA Inc (MBI.N: Quote, Profile, Research) and Ambac Financial Group Inc (ABK.N: Quote, Profile, Research), two of the world's biggest bond issuers, stretches the gains for William Ackman, head of Pershing Square Capital Management, who has been short both.

"Short-biased funds are going to prosper over the next few months as the subprime problem takes its toll. We think the problem is certainly going to continue," said Christopher Wolf, managing partner at Cogo Wolf Asset Management LLC, which runs a $100 million fund-of-hedge-funds.

In the mutual fund world, funds that engage in various short-selling strategies have been outperforming every other category in the recent past after being in the red over a one, two, three and five-year period.

...more...

[ozone_man]

70. The market is like a diode.

Money seems to flow one way like a diode passing current, until the diode reaches reverse breakdown potential. Or maybe an avalanche diode is more like it, once the margin calls start coming in.

Two weeks isn't so long to wait. This may be the trend for quite a while. I had to laugh listening to an economist tonight on NPR explaining how surprising and unforeseeable the down turn has been. :rofl:

[Joanne98]

46. Did any of you guys just see Cramer on CNBC?

[JNelson6563]

48. No, what'd he say?

Looks like a blood-letting this last hour.

Julie

[Roland99]

52. not from cubeland

[Bushwick Bill]

60. Here is his meltdown.

http://www.cnbc.com/id/15840232?video=452808336

Dear Mr. Cramer, interest rate cuts will make the dollar worthless.

[hatrack]

63. But at least there won't be any inflation if Chopper Ben does!

:eyes:

Funny thing, Cramer - the thought of thousands and thousands and thousands of people losing their jobs over the past 10-20 years through the miracle of creative destruction, and globalization and all of that happy eyewash, no problem.

But when "thousands of people" in the financial sector - i.e. people who "matter" and people whom he knows - face the prospect of losing their jobs, it's time to "Open the Discount Window! Open the Discount Window!!"

Oh, and by the way, considering that we're down to about 13,200 from 14,000, this doesn't even reach the 10% threshold which defines a "correction".

Why the flop sweat and hysteria?

[Joanne98]

66. Thanx. I was looking for that!

[Roland99]

51. 3:19pm - Lookout below!!

Dow 13,318.23 -145.10
Nasdaq 2,533.58 -42.40
S&P 500 1,447.64 -24.56
Oil $75.45 $-1.41
10 YR 4.70% -0.05
Gold $684.40 $7.80

[UpInArms]

57. closing numbers - the bottom gave way

Dow 13,181.91 down 281.42 (2.09%)
Nasdaq 2,511.25 down 64.73 (2.51%)
S&P 500 1,433.06 down 39.14 (2.66%)
10-Yr Bond 4.70% up 0.053

NYSE Volume 14,102,000
Nasdaq Volume 2,504,685,000

[UpInArms]

62. here's the cryin'

The major averages plunged Friday, snapping a two-day winning streak as another round of credit concerns and a slowdown in hiring sparked a widespread sell-off in stocks. The Dow, S&P 500, and Nasdaq tumbled 2.4% on average, closed at their worst levels of the day, and only one of the 147 S&P industry groups closed higher.

Before the bell, investors were already exhibiting a sense of skepticism about the sustainability of surprisingly strong late-day rallies over the previous two sessions. With the markets already nervous for any signs of a softening labor market, July payrolls checking in below economists' forecasts was viewed negatively, even though the addition of 92,000 new jobs (consensus 135,000) translates into a 0.8% annual rate of growth.

Today's economic data notwithstanding, the bigger headline risk was and remains high with respect to credit concerns; and today was no exception.

Growing fears of a possible credit crunch resurfaced after American Home Mortgage (AHM 0.69 -0.75) said it was shuttering operations and Countrywide Financial (CFC 25.00 -1.77) showed that credit default swap spreads widened by nearly 100 basis points.

The next shoe to drop was Standard & Poor's changing its rating outlook on Bear Stearns (BSC 108.79 -6.84) to negative from stable. The beaten-down broker tried to calm the market's nerves by issuing a press release that stated its business was, "solidly profitable in the first two months of the quarter, while the balance sheet, capital base and liquidity profile have never been stronger." That, however, was before the conference call commenced and management said this is the worst fixed income environment in 22 years.

Since credit risk exposure is impossible to quantify, and the Financial sector is representative of so much influence on the S&P 500, more evidence to suggest the possibility of such concerns leading to a systemic risk for the market weighed significantly on sentiment and left a market already showing reluctance to hold stocks over the weekend racing for the exits.

Market internals were decidedly bearish and volume was heavy again, further dictating the conviction with which sellers continue to feel the market is overbought at current levels. On the NYSE, where trading curbs were triggered late in the day as the S&P 500 broker through its 200-day moving average, decliners outpaced advancers by a more than 5-to-1 edge over advancers while those on the Nasdaq finished a 4-to-1 margin. BTK -1.0% DJ30 -281.42 DJTA -3.8% DJUA -3.6% DOT -2.4% NASDAQ -64.73 NQ100 -2.4% R2K -3.7% SOX -2.5% SP400 -2.9% SP500 -39.14 XOI -3.8% NASDAQ Dec/Adv/Vol 2453/591/2.31 bln NYSE Dec/Adv/Vol 2784/540/2.05 bln

[Buttercup McToots]

54. USD $80.04 @ 3.58pm

:yoiks:

[RUMMYisFROSTED]

58. Like a stock...um, er rock.

[UpInArms]

59. Another one fails: Subprime lender First NLC lays off 645 employees

http://www.reuters.com/article/bondsNews/idUSN0335712020070803

NEW YORK (Reuters) - First NLC Financial Services LLC, a subprime mortgage lender being sold by Friedman, Billings, Ramsey Group Inc (FBR.N: Quote, Profile, Research), said on Friday it has laid off nearly half of its 1,350 employees as it combats a slumping housing market.

Employees learned of the layoffs on Wednesday, according to Andrew Henschel, First NLC's vice president of corporate governance. About 645 employees are being let go, including more than one-third of those at its Boca Raton, Florida headquarters.

"We have had to reduce staff to compete more effectively," Henschel said in an interview. "Market conditions and the subprime landscape have changed dramatically. We were saddened to let valued employees go, but the landscape has changed."

The layoffs were announced less than a week after FBR said it would sell an 80 percent stake in First NLC to private equity firm Sun Capital Partners Inc. First NLC is being recapitalized, with Sun Capital investing $60 million and FBR investing $15 million.

...more...

[54anickel]

65. Anyone else catch the deafening silence regarding GSEs through all

of this. Wonder what's really up these days? :shrug: