STOCK MARKET WATCH, Friday March 14

[ozymandius]

Source: du

STOCK MARKET WATCH, Friday March 14, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 313
DAYS SINCE DEMOCRACY DIED (12/12/00) 2609 DAYS
WHERE'S OSAMA BIN-LADEN? 2335 DAYS
DAYS SINCE ENRON COLLAPSE = 2626
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

AT THE CLOSING BELL ON March 13, 2008

Dow... 12,145.74 +35.50 (+0.29%)
Nasdaq... 2,263.61 +19.74 (+0.88%)
S&P 500... 1,315.48 +6.71 (+0.51%)
Gold future... 993.80 +13.30 (+1.36%)
30-Year Bond 4.45% +0.04 (+1.00%)
10-Yr Bond... 3.53% +0.05 (+1.46%)






GOLD, EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp: Global "Oil Shock" Rattles World Stock Markets

BY GARY DORSCH

Cleaning up the mess that Mr. Greenspan left behind was never going to be easy. Banks and brokers around the world face more than half-trillion dollars in write-offs as a consequence of the US sub-prime mortgage crisis, which is spreading from the US property market and roiling global stock markets. It’s toppled the US economy into a recession and the tremors are also rattling Asian stock markets.

Roughly $7 trillion has been wiped from world stock markets since the beginning of the year amid fears of a severe US economic recession and financial institutions reporting more mega losses. “The market crisis will preoccupy us well into 2008,” said German Finance Minister Peer Steinbrueck on Feb 15th. “The financial risks securitized by banks contained packaged explosives,” and he accused rating agencies of having a conflict of interest in the role they played in the process.

So far, the Bernanke Federal Reserve has pumped more than half a trillion dollars into the markets with open market operations and special emergency lending schemes to help cushion the blow to the US economy and stock markets. However, there’s evidence that the Fed’s prescription for dealing with the sub-prime debt crisis is actually making matters much worse, and leading to “Stagflation.”

......

On Feb 15th, Fed chief Ben Bernanke played down the threat of spiraling energy and food prices, saying “inflation expectations remain reasonably well anchored,” then signaled another rate cut in March as an “insurance policy to head off an economic recession.” Since then, the price of crude oil has surged $17/barrel, and is wrecking havoc on Wall Street and other major stock markets around the globe.

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

[Ghost Dog]

14. Asian Stocks Fall, Set for Second Losing Week

March 14 (Bloomberg) -- Asian stocks fell, set for a second weekly decline, on concern credit market losses will widen and the dollar will weaken.

Toyota Motor Corp., which gets 37 percent of its sales in North America, sank as the dollar traded near a 12-year low against the yen. Urban Corp., a Japanese property developer, plunged after rivals cut their profit estimates. Nomura Holdings Inc., Japan's biggest securities firm, fell for a second day after the default of a Carlyle Group mortgage fund.

``Investors have learned from recent experience to be wary about what else might blow up, and that anxiety is putting the pressure on markets all around,'' said Park Sehick, who helps manage the equivalent of $1 billion at Hanwha Investment Trust Management Co. in Seoul. ``People will freeze up at times like this when they see panic selling.''

The MSCI Asia Pacific Index lost 1 percent to 135.71 as of 5:59 p.m. in Tokyo. The measure is down 2.8 percent this week and 14 percent for the year. A total of $3.3 trillion has been erased from global stock markets this year, on fears the U.S. will enter a recession amid increasing losses linked to investments in the country's mortgage industry.

Japan's Nikkei 225 Stock Average fell 1.5 percent, while Australia's S&P/ASX 200 Index climbed 1.4 percent. China's CSI 300 Index completed its worst week on record, amid concern the government will raise interest rates to cool inflation.

...

A gauge of financial shares on MSCI's Asia-Pacific index is down 19 percent this year, the most of the regional benchmark's 10 industry groups, amid mounting credit losses.

...

Gold rose above $1,000 an ounce for the first time yesterday as credit losses spurred demand for bullion as a haven. Silver jumped 2.1 percent. Crude oil settled in New York at a record $110.33 a barrel.

...

The Baltic Dry Index, a measure of shipping costs for commodities, fell 3 percent yesterday in London.

...

China's CSI 300 Index fell 1 percent, taking its decline this week to 10 percent, which is the most since the measure was first compiled in April 2005.

`Turning Point'

Banks declined today amid speculation higher interest rates to cool growth will sap demand for loans. Shanghai Pudong Development Bank Co., part-owned by Citigroup Inc., dropped 3.9 percent to 32.44 yuan.

China's fixed-asset investment grew 24.3 percent in the first two months of the year, even as the worst snowstorms in half a century disrupted projects, the statistics bureau said today. That's more than the 24 percent median estimate of 21 economists surveyed by Bloomberg News.

``We might see a turning point for the economy, after which growth would slow down,'' said Zhang Ling, who manages the equivalent of $1.1 billion with ICBC Credit Suisse Asset Management Co. in Beijing. ``Things are worse than expected.''

/... http://www.bloomberg.com/apps/news?pid=20601080&sid=alno1zVD3AVs&refer=asia

[Ghost Dog]

37. Tokyo stocks close at 31-month low on surging yen

TOKYO — Tokyo stocks fell sharply to a fresh low in two years and seven months Friday, closing at the lowest levels since early August 2005 on a surging yen.


The 225-issue Nikkei Stock Average, which fell over 3% Thursday, lost another 191.84 points, or 1.54 percent, to close at 12,241.60, the lowest level since Aug 10, 2005, when it finished at 12,098.08.

/. http://www.japantoday.com/jp/news/431098

``The market is in a meltdown,'' said Masaru Hamasaki, a senior strategist at Toyota Asset Management Co. with $3.3 billion in Tokyo. ``The foreigners are running away, while domestic investors are scared about what the sudden yen strength is going to do.''

The Nikkei 225 Stock Average sank 191.84, or 1.5 percent, to close at 12,241.60 in Tokyo, capping a 10 percent drop in the past two weeks. The broader Topix dropped 22.64, or 1.9 percent, to 1,193.23.

...

Volume on the main board of the Tokyo bourse surged to 3.15 billion shares, the highest level since August of last year when the collapse of two Bear Stearns Cos. hedge funds began the rout in credit markets. The Nikkei has fallen 20 percent so far this year, and is down 33 percent from its 12-month peak in July.

End in Sight?

Nomura, Japan's biggest brokerage, fell 3.2 percent to 1,478 yen, while insurer T&D Holdings Inc. lost 3 percent to 5,120 yen. Resona Holdings Inc., Japan's fourth-largest bank, slipped 3.1 percent to 157,000 yen.

Start-up credit hedge funds will collapse as brokerages withdraw support, the London-based Times reported, citing an unidentified hedge-fund manager. Bigger credit funds, with as much as $2 billion in assets, are also vulnerable, the Times said.

Standard & Poor's yesterday said writedowns of subprime- related investments may reach $285 billion globally, 7.5 percent more than the ratings company earlier forecast. Global financial companies have reported the bulk of those losses, and the end of the subprime problem is "in sight," it said.

"The fact that ratings companies cut their evaluations on collateralized debt obligations to a speculative level from top grades practically overnight shows they can't be trusted," said Yoshihisa Okamoto a Tokyo-based fund manager at Mizuho Asset Management Co., which manages about $26 billion.

/... http://www.bloomberg.com/apps/news?pid=20601101&sid=a15pcS7mQiyg&refer=japan

[Ghost Dog]

38. (London) Times article here:

London’s embattled hedge fund community is bracing for a spate of blow-ups in the wake of yesterday’s $16 billion (£7.9 billion) debt default by Carlyle Capital Corporation, the Dutch-listed affiliate of the American private equity group.

Numerous small start-up credit hedge funds, managing between $10 million and $200 million of assets, are facing a funding squeeze, according to sources. The prime brokers that provide credit liquidity to these funds are beginning to withdraw financial support or heavily increase their margin calls, they said.

Several bigger credit funds with as much as $2 billion under management are also looking vulnerable, particularly if they are highly leveraged, according to other sources.

“It’s basically any single-strategy hedge fund that is leveraged and invested in mortgage securities; it doesn’t matter whether it is AAA or sub-prime paper; these guys are at risk,” one London hedge fund manager said.
Related Links

“The smaller players with $10 million or so of funds, guys who jumped out of the investment banks to set up on their own, are under the greatest pressure. They don’t have enough assets to generate proper alpha for their investors. They barely generate enough management fees to pay their wife’s shopping bill,” the source said.

“They are not in a position to add assets because the banks don’t want to lend, so suddenly they don’t have a reason to exist any more.”

/... http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3549616.ece

[ozymandius]

2. Today's Reports

8:30 AM CPI Feb
Briefing Forecast 0.1%
Market Expects 0.3%
Prior 0.4%

8:30 AM Core CPI Feb
Briefing Forecast 0.2%
Market Expects 0.2%
Prior 0.3%

10:00 AM Mich Sentiment-Prel. Mar
Briefing Forecast 70.0
Market Expects 69.5
Prior 70.8

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

[UpInArms]

42. U.S. CPI up 4.0% in past 12 months vs 4.3% in Jan

05. U.S. Feb. CPI food prices up 0.4% vs 0.7% in Jan.
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

06. U.S. Feb. CPI energy prices down 0.5% , lowest since Aug.
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

07. U.S. CPI core up 2.3% in past 12 months vs 2.5% in Jan
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

08. U.S. CPI up 4.0% in past 12 months vs 4.3% in Jan
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

09. U.S. Feb. core CPI unchanged vs. up 0.2% expected
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

10. U.S. Feb CPI unchanged vs up 0.2% expected
8:30 AM ET, Mar 14, 2008 - 7 minutes ago

[Ghost Dog]

49. US CPI rises 4.0% on the year in February

FXstreet.com (Barcelona) – Consumer prices have risen 4.0% year on year in February, and they went 2.3% up excluding food and energy, while they remained flat on the month, according to data released buy the US Labor Department.

...

Energy prices have risen 18.9% on the year, while they declined 0.5% on the month. Food prices have posted a 4.6% yearly increase and a 0.4% rise on the month, while housing, which accounts for 40% of the CPI increased 0.2% on the month for its second consecutive time, and 2.8% year on year.

/.. http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=fba4c63b-0ac7-453b-ab6b-4ba940833031

[Ghost Dog]

62. Housing Index 40% of CPI, is this reasonable, all included?

The index for housing increased 0.2 percent in February. The index
for shelter was virtually unchanged in February, following a 0.3 percent
increase in January. Within shelter, the indexes for rent and for owners'
equivalent rent increased 0.2 and 0.1 percent, respectively, while the
index for lodging away from home fell 1.2 percent. (Prior to seasonal
adjustment, the index for lodging away from home increased 2.8 percent.)
The index for household fuels, which declined 0.1 percent in January,
increased 1.5 percent as a 7.2 percent increase in the index for natural
gas more than offset decreases in the indexes for fuel oil and for
electricity--down 1.5 and 0.3 percent, respectively. The index for
household furnishings and operations was virtually unchanged in February.

/Labor Dept. News Release... http://www.bls.gov/news.release/cpi.htm

[Birthmark]

72. I have a question:

"Food prices have posted a 4.6% yearly increase and a 0.4% rise on the month...

Where the hell are they shopping? I wanna shop there!!

[UpInArms]

74. well, it appears that whoever is doing the price comparisons

has now decided to go to the local food pantry to show that you can get food for free!

:eyes:

[Ghost Dog]

77. Via the substitution Paul Craig Roberts refers to (#27)

"The US inflation rate is about twice as high as the government’s inflation measures report. In order to hold down Social Security payments, the government changed the way it measures inflation. In the old measure, inflation measured the nominal cost of a defined standard of living. If the price of steak rose, up went the inflation rate. Today if the price of steak rises, the government assumes that people switch to hamburger. Inflation doesn’t go up. Instead, the standard of living it measures goes down."

The Release just says:

The food and beverages index rose 0.4 percent in February. The index
for food at home, which advanced 0.9 percent in January, increased 0.3
percent in February. Downturns in the indexes for fruits and vegetables,
for meats, poultry, fish, and eggs, and for nonalcoholic beverages were
responsible for the moderation. The index for fruits and vegetables
declined 1.3 percent, following a 2.2 percent rise in January. The
indexes for fresh vegetables and for fresh fruits declined 4.0 and 0.4
percent, respectively, while the index for processed fruits and vegetables
increased 1.7 percent. The index for meats, poultry, fish, and eggs,
which advanced 0.8 percent in January, declined 0.1 percent in February.
Price decreases for pork and for poultry--down 1.4 and 0.6 percent,
respectively--more than offset a 0.5 percent increase in beef prices. The
index for nonalcoholic beverages, which rose 1.6 percent in January,
declined 0.1 percent in February, reflecting a decline in prices for
coffee. On the other hand, the other three grocery store food groups
advanced more in February than in January. The index for cereal and
bakery products rose 1.8 percent, its largest monthly advance since
January 1975. The index for dairy products, which rose 0.2 percent in
January, increased 0.8 percent in February. The index for other food at
home increased 1.0 percent, following a 0.4 percent rise in January. The
other two components of the food and beverages index--food away from home
and alcoholic beverages--each increased 0.4 percent, the same as in
January.

[Birthmark]

96. Hedonic Adjustment: It's what USED to be for supper! nt

[Birthmark]

149. Damn! This is a tough room!!

I thought that was hysterically funny when I posted it. All the "LOL!s" I imagined are now mocking me like so many sub-prime mortgages. :)

[Robbien]

183. Ha.

It was very clever. :)

Clever wit on a day such as today with such a high volume of feds/wall streeter witlessness flying around does get lost in the din, does it not.

[Birthmark]

193. Sure does.

But it still hurts.

Okay, I'm kidding. I just wanted to everyone to notice me. The house is empty today and the cat is acting all snobby...again.

[Hugin]

188. Okay, I have a joke for you. (May shed some light)

First off... I chuckled at your post. :)


Now, the SMW... It's an odd sort of place.


joke

A new inmate was sitting in the mess hall during lunch and after everyone was almost through
eating their mush one of the other inmates stood and shouted out... "NUMBER 211!" Instantly, there
was uproarious laughter throughout the hall. After it had died down, another inmate stood and shouted
"NUMBER 97!" Which was again greeted with guffaws. The new inmate turned to the hard-timer seated
next to him and asked, "What's so funny about these numbers?" to which the hard-timer replied, "There
is a listing of approved jokes in the back of the Inmate Handbook and most of us have been here
so long we know all of the jokes by heart. So, we just refer to them by the numbers." "Ah!", thought
the new inmate, "This may be an opportunity for me to get on the good side of some of these guys."
So, he stood up and yelled, "NUMBER 47!"....

Total silence.... Crickets....

The new inmate blushed and quickly sat back down. He turned to the hard-timer and asked, "I don't understand.
Why didn't anyone laugh?" To which the hard-timer responded...

-

-

-

"They didn't like how you told it."

/joke

:rofl:

Ah, uh, well... That's one way to look at it. Keep trying Birthmark, you'll get a breakthrough. ;)

[Birthmark]

195. That's great!

Need to laugh these days.

[Hugin]

197. That! Is the whole truth... NUMBER 10,578.24!

Watch this. :7

[Robbien]

206. Okay how about

A story attributed to Huey Long; it is the story of a southern politician who appears on the capitol steps, holding up a copy of the local newspaper.

“Look at this,” he says, wearing a white suit and pointing to the headline. “It says here that I was seen coming out of the Bide-Away Motel at 5am after sleeping with a known prostitute.

“Well, I’m here to tell you this morning that every word of this allegation is false…

“First, it wasn’t the Bide-Away Motel; it was the Lincoln Hotel in the middle of town. And she wasn’t a ‘known prostitute.’ I never met her before in my life.

“And it wasn’t 6am…I never get up that early. It was 7am.”

Then, with a sly grin…

“And we didn’t sleep a wink…”

[Hugin]

209. LoL!

:D

[Ghost Dog]

216. That's all right, then.

:-)

[MilesColtrane]

120. CPI unchanged in February?

Logically I know that my own personal experiences with prices in Feb. doesn't necessarily reflect the statistics of the entire country, but.....c'mon.

Are these simply funny numbers to give the Chopper cover to cut rates again and to keep the Krazy Karousel spinning?

[UpInArms]

83. March UMich consumer sentiment said 70.5 vs. 70.8

03. March UMich consumer sentiment said 70.5 vs. 70.8
9:59 AM ET, Mar 14, 2008 - 2 minutes ago

[UpInArms]

103. Consumer mood weakens, confirms recession: survey

http://www.reuters.com/article/bondsNews/idUSN1439164820080314

NEW YORK (Reuters) - U.S. consumer confidence dipped in early March to fresh multiyear lows, confirming the economy is in recession, a private survey showed on Friday.

Adding to the downbeat outlook was a jump in worries over inflation outlook due to surging fuel prices, according to the Reuters/University of Michigan Surveys of Consumers.

The surveys' index of confidence slipped to 70.5 in early March from the final February reading of 70.8. Economists polled by Reuters had predicted a lower figure of 69.0.

"There was nearly unanimous agreement among consumers that the economy was now in recession," said Richard Curtin, director of the survey, in a statement.

...more...

[AnneD]

123. Guess there must not be as much...

lithium and prozac in the groundwater as there use to be.:evilgrin:

[UpInArms]

124. wtf? U.S. March 16% trimmed-mean CPI up 0.1%

01. U.S. March median CPI up 0.1%: Cleveland Fed
11:02 AM ET, Mar 14, 2008 - 1 minute ago

02. U.S. March 16% trimmed-mean CPI up 0.1%
11:02 AM ET, Mar 14, 2008 - 1 minute ago

[ozymandius]

3. Oil falls from record $111 a barrel

SINGAPORE - Oil prices retreated Friday from a record of $111 a barrel hit in the previous session as investors fled the declining dollar in search of a haven in commodities.

Analysts attributed the decline as part of the volatility that has characterized crude futures trading in recent weeks.

.....

Light, sweet crude for April delivery dropped 37 cents to $109.96 a barrel in Asian electronic trading on the New York Mercantile Exchange by midafternoon in Singapore.

Shum said the expiration of options on the April Nymex crude contract on Friday added to the volatility of trading.

.....

Interest rate cuts further weaken the dollar and have helped drive oil's rise, and another reduction in U.S. benchmark lending rates is expected at the Federal Reserve's regularly scheduled monetary policy meeting next Tuesday.

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

[ozymandius]

4. Maui drivers watch gas prices reach $4

WAILUKU, Hawaii - "Maui No Kai Oi" is a popular Hawaiian saying that means Maui is the best. Mike Sweeney recently moved to this idyllic island from Denver and was hit with the other side of living in paradise with his first visit to the gas pump: Maui is also No. 1 in gas prices.

.....

The pump finally stopped at $97.20, which put 24.5 gallons in his Chevrolet Avalanche.

He was elated about living on Maui and being reunited with his black, super-size pickup truck, which just arrived from Colorado, but he wasn't so thrilled about paying nearly $4 for a gallon of regular.

While the price of oil climbs above $110 a barrel, most Americans dread the day they will have to pay $4. On this tropical island and a few stations in California, $4 gas has already arrived, straining the pocketbooks of residents and businesses.

Maui is on the verge of becoming first area in the nation to average $4 for a gallon of regular. The average price in Wailuku reached $3.934 on Thursday, the highest price in AAA's Daily Fuel Gauge Report. At several stations, it was a penny shy of $4. In the remote coastal town of Hana, it was around $4.40 a gallon.

http://news.yahoo.com/s/ap/20080314/ap_on_bi_ge/four_dollar_gas

[salin]

5. Anatomy of a Carlyle Collapse

Anatomy of a Carlyle Collapse
Pressure on Banks Left an Ailing Fund Exposed

By Thomas Heath
Washington Post Staff Writer
Friday, March 14, 2008; Page D01

It was around noon on Wednesday, and the founders of the Carlyle Group, the District-based private-equity powerhouse, thought they had a $500 million deal to salvage their troubled European affiliate along with their firm's reputation.

The three co-founders, David M. Rubenstein, William E. Conway Jr. and Daniel D'Aniello, took a collective deep breath in their Pennsylvania Avenue offices after days spent fending off a handful of hungry banks. The banks, under enormous pressure from regulators to put their balance sheets in order, had been pressing Carlyle to put more money into the ailing, highly leveraged hedge fund known as Carlyle Capital.

---

http://www.washingtonpost.com/wp-dyn/content/article/2008/03/13/AR2008031303927.html?nav=rss_business

[ozymandius]

12. Who gets rich off $3 gas - who doesn't

NEW YORK (CNNMoney.com) -- Motorists may fume when forking over $3 a gallon at the local service station, but as it turns out, your local filling spot makes chump change from a gallon of gas.

So exactly who is getting rich?

Oil traders: While often blamed for pushing up prices, traders don't necessarily benefit from the high price of crude or gasoline; they profit from how much the price changes. Traders can get rich - as long as they bet correctly on whether prices will rise or fall.

For example, an investment bank that makes a bet that the price of oil will rise makes money when oil prices go from $95 to $100 a barrel - or $100 to $95 if it bet the price will fall - not on the difference between production cost and trading price.
.....

Gas stations: A surprisingly small amount goes to the guy who runs the station.

Most service stations are independently owned and operated and take in between 7 and 10 cents for every gallon they sell, according to the U.S. Energy Information Administration.
.....

Crude oil: This is the most expensive part of a gallon of gas. Of every gallon of gas $2.07 from every gallon of gas goes to producers of crude like Chevron (CVX, Fortune 500), BP (BP), and smaller outfits like Anadarko (APC, Fortune 500) and Marathon (MRO, Fortune 500), or national oil companies controlled by countries like Saudi Arabia, Mexico or Venezuela.

http://money.cnn.com/2008/03/13/news/economy/gas_gallon/index.htm?eref=yahoo

[salin]

6. Gallup Daily: Record Level of Pessimism About Economy

Gallup Daily: Record Level of Pessimism About Economy

Based on polling conducted March 10-12, 2008

PRINCETON, NJ -- Eighty-six percent of Americans say the U.S. economy is getting worse, the highest level of pessimism in the Gallup Poll Daily tracking report on the economy since its inception on Jan. 2 of this year. -- Frank Newport

http://www.gallup.com/poll/104956/Gallup-Daily-Record-Level-Pessimism-About-Economy.aspx

[Demeter]

19. Since When Is Truth "Pessimism"?

That's a fine way to invalidate a person's truthful report on local observations and personal data.

[ozymandius]

7. Budget would torpedo Bush's tax cuts

WASHINGTON - The Senate rejected calls from both parties' presidential candidates to take an election-year break from pork-barrel spending as a Democratic-run Congress passed budget plans that would torpedo hundreds of billions of dollars in tax cuts won by President Bush.

John McCain, the GOP nominee-to-be, couldn't attract even a majority of Senate Republicans to vote with him Thursday night behind the earmark moratorium touted by party conservatives as a way to restore the GOP's credibility with voters.

It failed on a 71-29 vote. Only three Democrats joined with Hillary Rodham Clinton and Barack Obama in voting for it.

.....

The Senate passed a companion plan by a 51-44 vote. It endorsed extending $340 billion of Bush's tax cuts but balked at continuing all of them. The competing versions head to talks in which the House is all but certain to accept the Senate's position endorsing tax cuts for the working poor, married couples, people with children and for those inheriting large estates.

......

Budget plans are nonbinding, but they highlight the difficult choices on taxes and spending facing the next president and Congress. Binding votes on the expiring Bush tax cuts will be left to his successor and the Congress that's elected in November.

http://news.yahoo.com/s/ap/20080314/ap_on_go_co/congress_budget

[ozymandius]

8. Sales, dollar plunge; oil soars

WASHINGTON - Oil hit a record high, the dollar sank again, and consumers stopped buying pretty much everything.

Stocks kept gyrating, too, on Thursday, swinging between gloomy recession evidence and rising hopes that all the bad news would bring another aggressive cut in interest rates when the Federal Reserve meets next week.

The Bush administration, conceding the economy was facing "difficult" times now, rushed out new proposals aimed at next time — plans to fix various problems that have led to a severe crisis in credit markets.

Administration officials predicted an economic rebound once the impact of the Fed's credit cuts and the recently passed economic stimulus package begin to be felt.*

Private analysts were not as confident, worrying that the economy is being hit by multiple blows and noting that some of the problems, such as plunging home sales and mortgage defaults, are showing no signs of abating.

http://news.yahoo.com/s/ap/20080314/ap_on_bi_go_ec_fi/economy

*To any lurking Bushbots: Economic policy is being decided by zombies who have eaten their own brains.

[ozymandius]

9. Economy Hammered by Toxic Blend of Ailments

Almost everything seems to be going wrong for the American economy at once. People are buying less, but most things are costing more. Mortgage rates are rising, the dollar is falling and prices of key commodities like oil are leaping from one record high to the next.

On Thursday, the dollar plumbed new lows against the Japanese yen and several other major currencies; the price of an ounce of gold jumped above $1,000 for the first time; and lenders raised home loan rates once again. Government figures showed retail sales fell in February as consumers cut back on cars, furniture and electronics.

Stocks fell sharply after the retail sales report was released early in the day, and a large investment fund said it was nearing collapse. The volatility that has defined the market lately continued unabated.

.....

Many specialists say policy makers can do only so much to protect the economy and warn that the government should be careful not to exacerbate inflation and create a new bubble like the one in housing that has burst. Lower interest rates and increased federal spending may not be enough to shore up growth, and some suggest that the only remedy for the pain may be the pain itself. A Standard & Poor’s report predicted that subprime mortgage write-downs at banks were nearly done, though losses in other areas might continue.

http://www.nytimes.com/2008/03/14/business/14econ.html?_r=2&hp&oref=slogin&oref=slogin

[Ghost Dog]

11. No mention of this going wrong for the American economy?

http://www.guardian.co.uk/cartoons/stevebell/0,,2265365,00.html

[ozymandius]

13. at least not in this article

I have found this mentioned elsewhere. I'll go look....

[Ghost Dog]

16. Stiglitz.

Eg: Three Trillion Dollar War http://www.democracynow.org/2008/2/29/exclusive_the_three_trillion_dollar_war

JOSEPH STIGLITZ: Well, I think the White House lacks the courage to engage in a national debate about the cost of the Iraq war. The Joint Economic Committee has asked the White House to come down and discuss the numbers; they’ve refused. Security is important, and we don’t deny that. The question is whether this war has been the best way of obtaining the security. And no matter what you’re going to do—you know, what you think about security, you still have to look at the cost. The costs have been important, even for the way we’ve waged the war. The reason the administration presumably did not buy, for instance, the MRAPs, these special vehicles that would have reduced the number of deaths by a very large fraction, is economics. So, you know, no matter what one says, economics is important, and the American people have the right to have an understanding of what those costs are. When we went to war, they said it was going to cost $50 billion. We are now spending that money upfront every three months, and that’s not even including the cost of veterans’ healthcare and disability down the line.

And eg. Stagflation Cometh: http://www.project-syndicate.org/commentary/stiglitz95

America’s ill-conceived war in Iraq helped fuel a quadrupling of oil prices since 2003. In the 1970’s, oil shocks led to inflation in some countries, and to recession elsewhere, as governments raised interest rates to combat rising prices. And some economies faced the worst of both worlds: stagflation.

Until now, three critical factors helped the world weather soaring oil prices. First, China, with its enormous productivity increases – based on resting on high levels of investment, including investments in education and technology ­– exported its deflation. Second, the United States took advantage of this by lowering interest rates to unprecedented levels, inducing a housing bubble, with mortgages available to anyone not on a life-support system. Finally, workers all over the world took it on the chin, accepting lower real wages and a smaller share of GDP.

That game is up. China is now facing inflationary pressures. What’s more, if the US convinces China to let its currency appreciate, the cost of living in the US and elsewhere will rise. And, with the rise of biofuels, the food and energy markets have become integrated. Combined with increasing demand from those with higher incomes and lower supplies due to weather-related problems associated with climate change, this means high food prices – a lethal threat to developing countries.

[ozymandius]

18. Basic economic principles assert themselves.

China is a victim of its own success. It creates consumer products (I dare not use the word "goods") and exports them around the world. To fuel this industrial boom, they need vast amounts of energy.

But when one calculates the price of transporting products around the world, the economic incentives that sustained China's industrial expansion become invalid. The same can be said of exporting production and, in turn, importing those consumer items. The cost realities negate the incentives.

No trick by way of monetary policy will fix this imbalance.

-edited for clarity-

[DemReadingDU]

26. I've been following Stiglitz, and Linda Bilmes

for about 3 years, back when it was only the trillion dollar war

http://www.nytimes.com/imagepages/2005/08/19/opinion/20bilmes.html

:(

[ozymandius]

15. "War costs and costs and costs"

Joseph Stiglitz gives the high point of the findings of his new book, The Three Trillion Dollar War, in a comment today in the Guardian.

I wish Stiglitz has gone on at more length about the horrific corruption and featherbedding in the Iraq contracting process. All the traditional rules were thrown out the window. This Vanity Fair article details some of the pilferage:

In (attorney Alan] Grayson's view, a nightmare combination of jacked-up bids, waste, kickbacks, and inflated subcontracts means that as much as half the value of every contract he has seen "ends up being fraudulent in one way or another." He adds, "Cumulatively, the amount that's been spent on contractors in the four-plus years of the war is now over $100 billion. Pick any number between 10 percent and 50 percent—I don't think you can seriously argue that the scale of the fraud is less than 10 percent. Either way, you're talking cumulatively about something between $10 and $50 billion."

Indeed, in February, the House Committee on Oversight and Government Reform got the news from Pentagon auditors that contractors in Iraq had claimed at least $10 billion—three times more than previous official estimates—in expenditures that were either unreasonably high or unsupported by proper documentation. Of this amount, $2.7 billion had been billed to the government by KBR.

While this number pales when compared to Stiglitz's $3 trillion, the money that the government permitted to be purloined could have instead gone to assuring the safety of the troops, who often were lacking in the basics, such as adequate body armor. That sort of stinginess produces huge human and financial costs down the road, in terms of costly disabilities.

From the Guardian:

With March 20 marking the fifth anniversary of the United States-led invasion of Iraq, it's time to take stock of what has happened. In our new book The Three Trillion Dollar War, Harvard's Linda Bilmes and I conservatively estimate the economic cost of the war to the US to be $3 trillion, and the costs to the rest of the world to be another $3tn - far higher than the Bush administration's estimates before the war. The Bush team not only misled the world about the war's possible costs, but has also sought to obscure the costs as the war has gone on.

This is not surprising. After all, the Bush administration lied about everything else, from Saddam Hussein's weapons of mass destruction to his supposed link with al-Qaida. Indeed, only after the US-led invasion did Iraq become a breeding ground for terrorists.

The Bush administration said the war would cost $50bn. The US now spends that amount in Iraq every three months. To put that number in context: for one-sixth of the cost of the war, the US could put its social security system on a sound footing for more than a half-century, without cutting benefits or raising contributions.

Moreover, the Bush administration cut taxes for the rich as it went to war, despite running a budget deficit. As a result, it has had to use deficit spending - much of it financed from abroad - to pay for the war. This is the first war in American history that has not demanded some sacrifice from citizens through higher taxes; instead, the entire cost is being passed onto future generations. Unless things change, the US national debt - which was $5.7tn when Bush became president - will be $2tn higher because of the war (in addition to the $800bn increase under Bush before the war).

.....

With so many people in Iraq suffering so much in so many ways, it may seem callous to discuss the economic costs. And it may seem particularly self-absorbed to focus on the economic costs to America, which embarked on this war in violation of international law. But the economic costs are enormous, and they go well beyond budgetary outlays.
Americans like to say that there is no such thing as a free lunch. Nor is there such a thing as a free war. The US - and the world - will be paying the price for decades to come.

http://www.nakedcapitalism.com/2008/03/war-costs-and-costs-and-costs.html

[ozymandius]

10. SEC to widen range for asset valuations: report

NEW YORK (Reuters) - The U.S. Securities and Exchange Commission is expected to tell public companies they can give investors a wider range of possible market values for hard-to-price assets, the Wall Street Journal reported on Friday.

The Journal said the guidance is aimed at giving investors more information about prices that are difficult to gauge because many markets have seized up in recent months.

http://news.yahoo.com/s/nm/20080314/bs_nm/sec_valuations_dc

[ozymandius]

17. Krugman: Betting the Bank (Fed's depleted options)

Four years ago, an academic economist named Ben Bernanke co-authored a technical paper that could have been titled “Things the Federal Reserve Might Try if It’s Desperate” — although that may not have been obvious from its actual title, “Monetary Policy Alternatives at the Zero Bound: An Empirical Investigation.”

Today, the Fed is indeed desperate, and Mr. Bernanke, as its chairman, is putting some of the paper’s suggestions into effect. Unfortunately, however, the Bernanke Fed’s actions — even though they’re unprecedented in their scope — probably won’t be enough to halt the economy’s downward spiral.

.....

When the Fed is worried about the state of the economy, it basically responds by printing more of that green paper, and using it to buy bonds from banks. The banks then use the green paper to make more loans, which causes businesses and households to spend more, and the economy expands.
.....
But sometimes the magic doesn’t work. And this is one of those times.

http://www.nytimes.com/2008/03/14/opinion/14krugman.html?_r=1&hp&oref=slogin

[Demeter]

20. Worrying About a Recession Is Like Painting a Burning House

The Fed and others ought to put the fires of fraud out, first.

[ozymandius]

22. Honestly, Demeter, I do not believe that these people care about price inflation.

They do care about wage inflation. Hence their solid stance against raising the minimum wage. However - this talk about worrying about a recession weighs more toward "keeping up appearances". This Republican economic policy is a failure. The reality of that is something the Bush administration does not want to be exposed while they're still in office.

Just my $.02.

[Demeter]

25. These People Don't Seem To Care About Anything Except Protecting Their Crimes

[kineneb]

151. and their own wealth. nt

[ozymandius]

21. Wall Street stocks head for mixed open

NEW YORK - Wall Street headed for a mixed opening Friday, as investors wait for a report on consumer-levcel inflation in February and a speech by President Bush on the faltering economy.
ADVERTISEMENT

The president is expected to tell a gathering of economists in New York that the economy is slowing but nonetheless is fundamentally sound and poised to return to higher growth*. The speech is not expected to unveil new initiatives, according to the White House press office. But Bush may be able to provide soothe the anxieties of investors who increasingly are worried that the U.S. already is in recession.

The February consumer price report also has the potential to offer some cheer to investors worried about the economy. The Consumer Price Index is expected to post a 0.3 percent advance, which would show a slight moderation in inflation from the 0.4 percent increase in January, according to Thomson/IFR. Excluding volatile food and energy prices, February CPI is expected to increase by just 0.2 percent.
.....

Ahead of the data report and the speech, the futures contract for the Dow Jones industrial average was down 24 points, or 0.2 percent, at 12,127. The futures contracts for the S&P 500 fell 1.30 point, or 0.1 percent, to 1314 while the Nasdaq 100 contracted gained 0.50 point, or 0.03 percent, to 1,756.25.

http://news.yahoo.com/s/ap/20080314/ap_on_bi_st_ma_re/wall_street

*Reminder: brain dead President Zombie

[Demeter]

23. The $200 billion bail-out for predator banks and Spitzer charges are intimately linked

Greg Palast (email)



While New York Governor Eliot Spitzer was paying an ‘escort’ $4,300 in a hotel room in Washington, just down the road, George Bush’s new Federal Reserve Board Chairman, Ben Bernanke, was secretly handing over $200 billion in a tryst with mortgage bank industry speculators. Both acts were wanton, wicked and lewd. But there’s a BIG difference. The Governor was using his own checkbook. Bush’s man Bernanke was using ours.

This week, Bernanke’s Fed, for the first time in its history, loaned a selected coterie of banks one-fifth of a trillion dollars to guarantee these banks’ mortgage-backed junk bonds. The deluge of public loot was an eye-popping windfall to the very banking predators who have brought two million families to the brink of foreclosure.

Up until Wednesday, there was one single, lonely politician who stood in the way of this creepy little assignation at the bankers’ bordello: Eliot Spitzer.

Who are they kidding? Spitzer’s lynching and the bankers’ enriching are intimately tied.
How? Follow the money.

The press has swallowed Wall Street’s line that millions of US families are about to lose their homes because they bought homes they couldn’t afford or took loans too big for their wallets. Ba-LON-ey. That’s blaming the victim.

Here’s what happened. Since the Bush regime came to power, a new species of loan became the norm, the ‘sub-prime’ mortgage and it’s variants including loans with teeny “introductory” interest rates. From out of nowhere, a company called ‘Countrywide’ became America’s top mortgage lender, accounting for one in five home loans, a large chuck of these ‘sub-prime.’

Here’s how it worked: The Grinning Family, with US average household income, gets a $200,000 mortgage at 4% for two years. Their $955 a month payment is 25% of their income. No problem. Their banker promises them a new mortgage, again at the cheap rate, in two years. But in two years, the promise ain’t worth a can of spam and the Grinnings are told to scram - because their house is now worth less than the mortgage. Now, the mortgage hits 9% or $1,609 plus fees to recover the “discount” they had for two years. Suddenly, payments equal 42% to 50% of pre-tax income. Grinnings move into their Toyota.

Now, what kind of American is ‘sub-prime.’ Guess. No peeking. Here’s a hint: 73% of HIGH INCOME Black and Hispanic borrowers were given sub-prime loans versus 17% of similar-income Whites. Dark-skinned borrowers aren’t stupid – they had no choice. They were ‘steered’ as it’s called in the mortgage sharking business. ‘Steering,’ sub-prime loans with usurious kickers, fake inducements to over-borrow, called ‘fraudulent conveyance’ or ‘predatory lending’ under US law, were almost completely forbidden in the olden days (Clinton Administration and earlier) by federal regulators and state laws as nothing more than fancy loan-sharking. But when the Bush regime took over, Countrywide and its banking brethren were told to party hardy – it was OK now to steer’m, fake’m, charge’m and take’m.

But there was this annoying party-pooper. The Attorney General of New York, Eliot Spitzer, who sued these guys to a fare-thee-well. Or tried to.

Instead of regulating the banks that had run amok, Bush’s regulators went on the warpath against Spitzer and states attempting to stop predatory practices. Making an unprecedented use of the legal power of “federal pre-emption,” Bush-bots ordered the states to NOT enforce their consumer protection laws. Indeed, the feds actually filed a lawsuit to block Spitzer’s investigation of ugly racial mortgage steering. Bush’s banking buddies were especially steamed that Spitzer hammered bank practices across the nation using New York State laws.

Spitzer not only took on Countrywide, he took on their predatory enablers in the investment banking community. Behind Countrywide was the Mother Shark, its funder and now owner, Bank of America. Others joined the sharkfest: Goldman Sachs, Merrill Lynch and Citigroup’s Citibank made mortgage usury their major profit centers. They did this through a bit of financial legerdemain called “securitization.”

What that means is that they took a bunch of junk mortgages, like the Grinnings, loans about to go down the toilet and re-packaged them into “tranches” of bonds which were stamped “AAA” - top grade - by bond rating agencies. These gold-painted turds were sold as sparkling safe investments to US school district pension funds and town governments in Finland (really).

When the housing bubble burst and the paint flaked off, investors were left with the poop and the bankers were left with bonuses. Countrywide’s top man, Angelo Mozilo, will ‘earn’ a $77 million buy-out bonus this year on top of the $656 million - over half a billion dollars – he pulled in from 1998 through 2007.

But there were rumblings that the party would soon be over. Angry regulators, burned investors and the weight of millions of homes about to be boarded up were causing the sharks to sink. Countrywide’s stock was down 50%, and Citigroup was off 38%, not pleasing to the Gulf sheiks who now control its biggest share blocks.

Then, on Wednesday of this week, the unthinkable happened. Carlyle Capital went bankrupt. Who? That’s Carlyle as in Carlyle Group. James Baker, Senior Counsel. Notable partners, former and past: George Bush, the Bin Laden family and more dictators, potentates, pirates and presidents than you can count.

The Fed had to act. Bernanke opened the vault and dumped $200 billion on the poor little suffering bankers. They got the public treasure – and got to keep the Grinning’s house. There was no ‘quid’ of a foreclosure moratorium for the ‘pro quo’ of public bail-out. Not one family was saved – but not one banker was left behind.

Every mortgage sharking operation shot up in value. Mozilo’s Countrywide stock rose 17% in one day. The Citi sheiks saw their company’s stock rise $10 billion in an afternoon.

And that very same day the bail-out was decided – what a coinkydink! – the man called, ‘The Sheriff of Wall Street’ was cuffed. Spitzer was silenced.

Do I believe the banks called Justice and said, “Take him down today!” Naw, that’s not how the system works. But the big players knew that unless Spitzer was taken out, he would create enough ruckus to spoil the party. Headlines in the financial press – one was “Wall Street Declares War on Spitzer” - made clear to Bush’s enforcers at Justice who their number one target should be. And it wasn’t Bin Laden.

It was the night of February 13 when Spitzer made the bone-headed choice to order take-out in his Washington Hotel room. He had just finished signing these words for the Washington Post about predatory loans:

“Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which he federal government was turning a blind eye.”

Bush, said Spitzer right in the headline, was the “Predator Lenders’ Partner in Crime.” The President, said Spitzer, was a fugitive from justice. And Spitzer was in Washington to launch a campaign to take on the Bush regime and the biggest financial powers on the planet.

Spitzer wrote, “When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners the Bush administration will not be judged favorably.”

But now, the Administration can rest assured that this love story – of Bush and his bankers - will not be told by history at all – now that the Sheriff of Wall Street has fallen on his own gun.

A note on “Prosecutorial Indiscretion.”

Back in the day when I was an investigator of racketeers for government, the federal prosecutor I was assisting was deciding whether to launch a case based on his negotiations for airtime with 60 Minutes. I’m not allowed to tell you the prosecutor’s name, but I want to mention he was recently seen shouting, “Florida is Rudi country! Florida is Rudi country!”

Not all crimes lead to federal bust or even public exposure. It’s up to something called “prosecutorial discretion.”

Funny thing, this ‘discretion.’ For example, Senator David Vitter, Republican of Louisiana, paid Washington DC prostitutes to put him diapers (ewww!), yet the Senator was not exposed by the US prosecutors busting the pimp-ring that pampered him.
Naming and shaming and ruining Spitzer – rarely done in these cases - was made at the ‘discretion’ of Bush’s Justice Department.

Or maybe we should say, 'indiscretion.'

************
Greg Palast, former investigator of financial fraud, is the author of the New York Times bestsellers Armed Madhouse and The Best Democracy Money Can Buy.

[fasttense]

36. Just this morning on CNN, they had a warning to bankrupt homeowners - Don't burn down the house.

CNN had convicted homeowners who had burned down their overpriced and over-leveraged homes, tell all not to burn down their own albatross. The homeowners were up their with tears in their eyes saying things like "I went bankrupt, I don't have a penny to my name, I burned down the house for the insurance money, I still owe the bank money on the burned out house." Then the commentator came on and told us all how bad these people were because it raised the fire insurance rates of all homeowners. Yeah, ok, you made your point with a hammer TIME-WARNER-AOL.

http://money.cnn.com/2008/01/09/news/economy/birger_arson.fortune/index.htm?postversion=2008011003

Take your licking homeowners. Be good little marks and pay back those scams we fostered on you. Don't complain, and whatever you do, don't burn down our houses.

I wonder if they had pumped $200 billion into homeowners hands, would we be seeing the problems we are seeing with financial institutions right now? Seems the bushes are priming the wrong end of the pump.

[donkeyotay]

145. Really. If they want to bail out someone they should bail us out.

Raise interest rates to reflect what bush as actually done to the dollar and our economy, let the BFEE wing of Wall St. fail and buy orange jumpsuits with their corporate logos. People who have - as they like to say - "worked hard and played by the rules" all their lives are seeing everything they worked for go down the drain while Goldman Sachs poses as the Treasury and the Fed pretends it isn't private. Pull the plug. The pain will be worth it if we can finally get rid of these guys. They way they're trying to work it, we'll get to tighten our Reagan belts around our necks and get to be poorer while the scum walk out of this richer and the whole economy is one more notch into useless.

[Lasher]

169. They don't want to bail us out.

Why do you think Republicans changed the bankruptcy law? The old version would have sure come in handy right now for a lot of folks.

[TrogL]

235. I went to the trouble of getting a proper mortgage

My bank has strict borrowing rules and did NOT get heavily involved in the sub-prime mortgage market, for damn good reason.

Why the hell should my rates go up?

[AnneD]

80. Morning Marketeers....

:donut: When I was younger, I was very naive and trusting. I use to think that some thing-like the lone gunman theory was truth because the government's Warren Commission said so. I thought all those :tinfoilhat: folks were crazy. But then during Nixon's re-election-I started to here buzz about break ins, and Hoover with his files etc. What was once unbelievable was true. At that time I lost faith in my government to tell me the truth. My naivety and trust has been replaced with skepticism. I have my own tin foil hat now.

Frankly, as far fetched as it seems-I give this story much credence. Anyone that follow WS very closely can't help but wonder. It is nothing for these guy to off an up and comer, especially if he threatens their interests like Spitzer. And what about Henry Cisneros-as far as I know-he is STILL under investigation. There was a good prospective for higher office-but not anymore. I am beginning to think we are too quick to throw the baby out with the bath water here.

So I guess there really are 2 Americas. One that believes their government, and one that doesn't. The ones that believe their government are called Republicans.....

Just like the Clinton Scandal-everyone is blinded by the sex that they loose site more important things happening around them. Like dupes watching a magic show-we so busy watching the right hand all the while our pockets are picked with the left hand.


Happy hunting and watch out for the bears.

[donkeyotay]

140. Wow. No matter how bad you think it is, it's worse. nt

[wordpix]

161. oh WOW. Looting of the Treasury goes on by BushCo---steal all they can get before they exit stage

and the head of the posse now in jail over prostitution. :cry:

[Hugin]

175. Bookmarked.

;(

[cosmicdot]

219. here's a link to the article

http://www.gregpalast.com/elliot-spitzer-gets-nailed/

[ozymandius]

24. Mortgage broker, lender plan too little too late

NEW YORK (Reuters) - The latest federal plan to restore confidence in mortgage bond and housing markets, promising strict home lender and mortgage broker standards, might thwart the next crisis but does little to quell this one.

Treasury Secretary Henry Paulson unveiled the President's Working Group plan on Thursday, recommending "strong nationwide licensing standards" for brokers and tougher oversight of all mortgage originators.

Slack lending practices that fostered record U.S. home price appreciation earlier in the decade are faulted for the housing bubble and its subsequent bursting.

.....

With home mortgage foreclosures escalating, there is a dearth of investor demand for bonds backed by many mortgages. In addition, lenders are rejecting many more borrowers and house prices are falling in what is seen as the worst housing market since the Great Depression.

http://www.reuters.com/article/reutersEdge/idUSN1330152520080314

[Ghost Dog]

33. See here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=114x36048

[Demeter]

27. Watching the Dollar Die By Paul Craig Roberts

http://www.informationclearinghouse.info/article19530.htm


13/03/08 "ICH " -- - I’ve been watching the dollar die all my life. I sometimes think I will outlast it.

When I was a young man, gold was $35 an ounce. Today one ounce gold bullion coins, such as the Canadian Maple Leaf, cost more than $1,000.

Our coinage was silver. Our dimes, quarters, and half dollars had purchasing power. Even the nickel could purchase a candy bar, ice cream cone or soft drink, and a penny could purchase bubble gum or hard candy. If a kid could collect 5 discarded soft drink bottles from a construction site, the 2 cents deposit on the returnable bottles was enough for the Saturday afternoon movie. Gasoline was 32 cents a gallon. A dollar’s worth was enough for a Saturday night date.

Our silver coinage was 90% silver. People sometimes melted coins in order to make silver spoons, known as coin silver, which can still be found in antique shops. Except for the reduced silver (40%) Kennedy half dollar which continued until 1970, 1964 was the last year of America’s silver coinage. The copper penny departed in 1982. As Assistant Secretary of the Treasury, I opposed the demise of America’s last commodity money, but I couldn’t prevent the copper penny’s death.

During World War II (1941-1945), nickel was diverted from coinage to war, and the US mint issued a wartime silver (35%) nickel.

It is not easy to find items to purchase with today’s US coins, but the silver coins of the same face value still have purchasing power. The 10 cent piece of my youth contains $1.42 worth of silver at today’s silver price. The quarter is worth $3.55, and the half dollar contains $7.10 of silver. The silver dollar is worth 15.2 times its face value. These are just the silver values of coins that might be worth far more depending on condition and rarity. The silver in the wartime nickel is worth $1.10, which is 22 times the coin’s face value. Even the copper penny is worth 2.5 cents.

When I was a young man enjoying travels in Europe, the German mark or Swiss franc traded four to one US dollar. The euro, which is today’s equivalent to the mark or franc, costs $1.55.

People who haven’t accumulated much age have little idea of the corrosive power of “acceptable” inflation. Unlike gold and silver, fiat money has no intrinsic value. When money is created faster than goods and services it drives up prices, thus driving down the value of the money. If freely traded currencies are excessively printed or if inflation, budget deficits, and trade deficits drive currencies off their fixed exchange rates, prices of imports rise as the foreign exchange value of the currency falls.

Today the US, heavily dependent on imports, is subject to double-barrel inflation from both domestic money creation and decline in the dollar’s foreign exchange value.

The US inflation rate is about twice as high as the government’s inflation measures report. In order to hold down Social Security payments, the government changed the way it measures inflation. In the old measure, inflation measured the nominal cost of a defined standard of living. If the price of steak rose, up went the inflation rate. Today if the price of steak rises, the government assumes that people switch to hamburger. Inflation doesn’t go up. Instead, the standard of living it measures goes down.

This is just one of the many ways that the government pulls the wool over our eyes.

With the dollar value of the euro rising through the roof, today a vacation in Europe is far more costly than in the past. Thanks to China, so far Americans have been sheltered from the greatest effects of the dollar’s declining value. Our greatest trade deficit is with China. The prices of the goods from China have not risen, because China keeps its currency pegged to the dollar. As the dollar goes down, China’s currency goes with it, thus holding down price rises.

The resignation of Admiral William Fallon as US military commander in the Middle East probably signals a Bush Regime attack on Iran. Fallon said that there would be no US attack on Iran on his watch. As there was no reason for Fallon to resign, it is not farfetched to conclude that Bush has removed an obstacle to war with Iran.


The US is already over stretched both militarily and economically. An attack on Iran is likely to be the straw that breaks the camel’s back.

Paul Craig Roberts was Assistant Secretary of the Treasury during President Reagan’s first term. He was Associate Editor of the Wall Street Journal. He has held numerous academic appointments, including the William E. Simon Chair, Center for Strategic and International Studies, Georgetown University, and Senior Research Fellow, Hoover Institution, Stanford University. He was awarded the Legion of Honor by French President Francois Mitterrand.

[ozymandius]

28. Carlyle Capital rallies on compensation hopes

LONDON (MarketWatch) -- Shares of Carlyle Capital Corp. rallied Friday, gaining after the co-founder of private-equity giant Carlyle Group pledged to look at options for compensating investors in the stricken fund.

David Rubenstein told the Financial Times that Washington-based Carlyle Group is examining the legal issues surrounding compensating shareholders in Carlyle Capital.

.....

Carlyle Capital's shares nearly doubled to 69 cents a share, but they're still down nearly 95% since the fund first announced it had missed some margin payments to lenders.

.....
On Thursday, the fund said that it would default on all its debt and that it expected lenders to seize "substantially all" remaining assets after failing to negotiate new financing terms.

http://www.marketwatch.com/news/story/carlyle-capital-rallies-compensation-hopes/story.aspx?guid=%7B4A3A9DB0-8FCD-4776-A34A-910D3D9E9CB2%7D&dist=hplatest

[Demeter]

31. Mafia Style Negotiations!

Either pay up, Bush, or we WON'T take your idiot son out!

[formercia]

40. Buyers' Remorse.

Junior turned out to be a real pig in a poke.

[Robbien]

110. Rubenstein is now calling this just a hiccup

said they will get past the ``hiccup'' in its relationship with the Wall Street banks that also finance leveraged buyouts.

``We have made a lot of money with, and for, these banks and this is a hiccup in a 20-year relationship,'' co-founder David Rubenstein said in an interview yesterday. ``We don't think any of them have any animus toward us and we're not antagonistic toward them.''

. . .

``A year from now, hopefully people will say, `Carlyle made a mistake,' or `The markets just moved against them,''' Rubenstein said.

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


They are all sharks swimming in the same pool.

[Ghost Dog]

146. `The markets just moved against them,'

... and that's not supposed to ever happen. Amazing. Just amazing ...

[wordpix]

162. didn't bushie give Carlyle enough of the $200 billion bailout pie?

[ozymandius]

29. Cash gold nears $1,000 level hit by U.S. futures

SINGAPORE (Reuters) - Spot gold jumped on Friday and held within sight of the $1,000-an-ounce barrier broken on the futures market after the dollar hit a record low against the euro, boosting the metal's appeal as an alternative investment.

Gold has gained nearly 20 percent in 2008, driven by buying from investors and speculators on expectations of further interest rate cuts in the United States and record high oil prices, which raised its appeal as a hedge against inflation.

Spot gold rose to $996.00/996.90 an ounce from $991.00/991.80 late in New York. It had powered to another record high of $999.90 an ounce on Thursday.

http://www.washingtonpost.com/wp-dyn/content/article/2008/03/14/AR2008031400712.html

[Demeter]

30. Roubini's Nightmare Scenario; A Vicious Circle Ending In A Systemic Financial Meltdown

http://www.informationclearinghouse.info/article19531.htm




By Mike Whitney

13/03/08 "ICH" -- - "It's another round of the credit crisis. Some markets are getting worse than January this time. There is fear that something dramatic will happen and that fear is feeding itself," Jesper Fischer-Nielsen, interest rate strategist at Danske Bank, Copenhagen; Reuters

Yesterday's action by the Federal Reserve proves that the banking system is insolvent and the US economy is at the brink of collapse. It also shows that the Fed is willing to intervene directly in the stock market if it keeps equities propped up. This is clearly a violation of its mandate and runs contrary to the basic tenets of a free market. Investors who shorted the market yesterday, got clobbered by the not so invisible hand of the Fed chief.

In his prepared statement, Bernanke announced that the Fed would add $200 billion to the financial system to shore up banks that have been battered by mortgage-related losses. The news was greeted with jubilation on Wall Street where traders sent stocks skyrocketing by 416 points, their biggest one-day gain in five years.

“It's like they're putting jumper cables onto a battery to kick-start the credit market,'' said Nick Raich, a manager at National City Private Client Group in Cleveland. ``They're doing their best to try to restore confidence.''

“Confidence”? Is that what it's called when the system is bailed out by Sugar-daddy Bernanke?

(EDITORIAL NOTE: ONLY WHEN IT'S A CONFIDENCE (OR "CON") GAME!)


When there's a funding-freeze by lenders, investors hit the exits as fast as their feet will carry them. That's why the lights started blinking red at the Federal Reserve and Bernanke concocted a plan to add $200 billion to the listing banking system...The point is, Bernanke's latest scheme is not a remedy for the trillion dollar unwinding of bad bets. It is merely a quick-fix to avoid a bloody stock market crash brought on by prevailing conditions in the credit markets.

Bernanke coordinated the action with the other members of the global banking cartel---The Bank of Canada, the Bank of England, the European Central Bank, the Federal Reserve, and the Swiss National Bank---and cobbled together the new Term Securities Lending Facility (TSLF), which “will lend up to $200 billion of Treasury securities to primary dealers secured for a term of 28 days (rather than overnight, as in the existing program) by a pledge of other securities, including federal agency debt, federal agency residential-mortgage-backed securities (MBS), and non-agency AAA/Aaa-rated private-label residential MBS. The TSLF is intended to promote liquidity in the financing markets for Treasury and other collateral and thus to foster the functioning of financial markets more generally.” (Fed statement)

The plan, of course, is wildly inflationary and will put additional downward pressure on the anemic dollar. No matter. All of the Fed's tools are implicitly inflationary anyway, but they'll all be put to use before the current crisis is over.

The Fed's statement continues: “The Federal Open Market Committee has authorized increases in its existing temporary reciprocal currency arrangements (swap lines) with the European Central Bank (ECB) and the Swiss National Bank (SNB). These arrangements will now provide dollars in amounts of up to $30 billion and $6 billion to the ECB and the SNB, respectively, representing increases of $10 billion and $2 billion. The FOMC extended the term of these swap lines through September 30, 2008.”

So, why is the Fed issuing loans to foreign banks? Isn't that a tacit admission of its guilt in the trillion dollar subprime swindle? Or is it simply a way of warding off litigation from angry foreign investors who know they were cheated with worthless toxic bonds? In any event, the Fed's largess proves that the G-10 operates as de facto cartel determining monetary policy for much of the world. (The G-10 represents roughly 85% of global GDP)...

As for Bernanke's Term Securities Lending Facility (TSLF) it is intentionally designed to circumvent the Fed's mandate to only take top-grade collateral in exchange for loans. No one believes that these triple A mortgage-backed securities are worth more than $.70 on the dollar. In fact, according to a report in Bloomberg News yesterday: “AAA debt fell as low as 61 cents on the dollar after record home foreclosures and a decline to AA may push the value of the debt to 26 cents, according to Credit Suisse Group. Additionally, the Fed is offering 28 day repos which --if this auction works like the Fed's other facility, the TAF---the loans can be rolled over free of charge for another 28 days. Yippee. The Fed found a way to recapitalize the banks with permanent rotating loans and the public is none the wiser. The capital-starved banksters at Citi and Merrill must feel like they just won the lottery. Unfortunately, Bernanke's move effectively nationalizes the banks and makes them entirely dependent on the Fed's fickle generosity.

The New York Times Floyd Norris sums up Bernanke's efforts like this:

“The Fed’s moves today and last Friday are a direct effort to counter a loss of liquidity in mortgage-backed securities, including those backed by Fannie Mae and Freddie Mac. Given the implied government guarantee of Freddie and Fannie, rising yields in their paper served as a warning sign that the crunch was worsening and investor confidence was waning. On Oct. 30, the day before the Fed cut the Fed funds rate from 4.75 percent to 4.5 percent, the yield on Fannie Mae securities was 5.75 percent. Today the Fed Funds rate is 3 percent, and the Fannie Mae rate is 5.71 percent, virtually the same as in October.....A sign of the Fed’s success, or lack of same, will be visible in that rate. It needs to come down sharply, in line with Treasury bond rates. Today, the rate was up for most of the day, but it did fall back at the end of the day. Watch that rate for the rest of the week to see indications of whether the Fed’s move is really working to restore confidence.”

Norris is right; it all depends on whether rates go down and whether that will rev-up the moribund housing market again. Of course, that is predicated on the false assumption that consumers are too stupid to know that housing is in its biggest decline since the Great Depression. This is just another slight miscalculation by the blinkered Fed. Housing will not be resuscitated anytime in the near future, no matter what the conditions; and you can bet on that. The last time Bernanke cut interest rates by 75 basis points mortgage rates on the 30-year fixed actually went up a full percentage point. This had a negative affect on refinancing as well as new home purchases. The cuts were a total bust in terms of home sales.

Still, equities traders love Bernanke's antics and, for the next 24 hours or so, he'll be praised for acting decisively. But as more people reflect on this latest manuver, they'll see it for what it really is; a sign of panic. Even more worrisome is the fact that Bernanke is quickly using every arrow in his quiver. Despite the mistaken belief that the Fed can print money whenever it chooses; there are balance sheets constraints; the Fed's largess is finite. According to MarketWatch:

"Counting the currency swaps with the foreign central banks, the Fed has now committed more than half of its combined securities and loan portfolio of $832 billion, Lou Crandall, chief economist for Wrightson ICAP noted. 'The Fed won't have run completely out of ammunition after these operations, but it is reaching deeper into its balance sheet than before."

... So now the Fed is planning to expand its mandate and bail out investment banks, hedge funds, brokerage houses and probably every other brandy-swilling Harvard grad who got caught-short in the subprime mousetrap. Ain't the “free market” great?

But none of Bernanke's bailout schemes will succeed. In fact, all he's doing is destroying the currency by trying to reflate the equity bubble. And how much damage is he inflicting on the dollar? According to Bloomberg, “the risk of losses on US Treasury notes exceeded German bunds for the first time ever amid investor concern the subprime mortgage crisis is sapping government reserves....Support for troubled financial institutions in the U.S. will be perceived as a weakening of U.S. sovereign credit.''

America is going broke and the rest of the world knows it. Bernanke is just speeding the country along the ever-steepening downward trajectory.


"In the United States, a new tipping point will translate into a collapse of the real economy, final socio-economic stage of the serial bursting of the housing and financial bubbles and of the pursuance of the US dollar fall. The collapse of US real economy means the virtual freeze of the American economic machinery: private and public bankruptcies in large numbers, companies and public services closing down massively.” (Statement from The Global Europe Anticipation Bulletin (GEAB)

Is that too gloomy? Then take a look at these eye-popping charts which show the extent of the Fed's lending operations via the Temporary Auction Facility. The loans have helped to make the insolvent banks look healthy, but at great cost to the country's economic welfare. http://benbittrolff.blogspot.com/2008/03/really-scary-fed-charts-march.html

The Fed established the TAF in the first place; to put a floor under mortgage-backed securities and other subprime junk so the banks wouldn't have to try to sell them into an illiquid market at fire-sale prices. But the plan has backfired and now the Fed feels compelled to contribute $200 billion to a losing cause. It's a waste of time.

UBS puts the banks total losses from the subprime fiasco at $600 billion. If that's true, (and we expect it is) then the Fed is out of luck because, at some point, Bernanke will have to throw in the towel and let some of the bigger banks fail. And when that happens, the stock market will start lurching downward in 400 and 500 point increments. But what else can be done? Solvency can only be feigned for so long. Eventually, losses have to be accounted for and businesses have to fail. It's that simple.


So far, the Fed's actions have had only a marginal affect. The system is grinding to a standstill. The country's two largest GSEs, Fannie Mae and Freddie Mac, which are presently carrying $4.5 trillion of loans on their books, are teetering towards bankruptcy. Both are gravely under-capitalized and (as a recent article in Barron's shows) Fannies equity is mostly smoke and mirrors. No wonder investors are shunning their bonds. Additionally, the cost of corporate bond insurance is now higher than anytime in history, which makes funding for business expansion or new projects nearly impossible. The wheels have come of the cart. The debt markets are upside-down, consumer confidence is drooping and, as the Financial Times states, “A palpable sense of crisis pervades global trading floors.” It's all pretty grim.

The banks are facing a “systemic margin call” which is leaving them capital-depleted and unwilling to lend. Thus, the credit markets are shutting down and there's a stampede for the exits by the big players. Bernanke's chances of reversing the trend are nil. The cash-strapped banks are calling in loans from the hedge funds which is causing massive deleveraging. That, in turn, is triggering a disorderly unwind of trillions of dollars of credit default swaps and other leveraged bets. Its a disaster. Economist Nouriel Roubini predicted the whole sequence of events six months before the credit markets seized and the Great Unwind began”. Here's a sampling of his recent testimony before Congress:


Roubini's Testimony before Congress:

“There is now a rising probability of a "catastrophic" financial and economic outcome; a vicious circle where a deep recession makes the financial losses more severe and where, in turn, large and growing financial losses and a financial meltdown make the recession even more severe. The Fed is seriously worried about this vicious circle and about the risks of a systemic financial meltdown....Capital reduction, credit contraction, forced liquidation and fire sales of assets at below fundamental prices will ensue leading to a cascading and mounting cycle of losses and further credit contraction. In illiquid market actual market prices are now even lower than the lower fundamental value that they now have given the credit problems in the economy. Market prices include a large illiquidity discount on top of the discount due to the credit and fundamental problems of the underlying assets that are backing the distressed financial assets. Capital losses will lead to margin calls and further reduction of risk taking by a variety of financial institutions that are now forced to mark to market their positions. Such a forced fire sale of assets in illiquid markets will lead to further losses that will further contract credit and trigger further margin calls and disintermediation of credit.

To understand the risks that the financial system is facing today I present the "nightmare" or "catastrophic" scenario that the Fed and financial officials around the world are now worried about. Such a scenario – however extreme – has a rising and significant probability of occurring. Thus, it does not describe a very low probability event but rather an outcome that is quite possible.”

Roubini has been right from the very beginning, and he is right again now. Bernanke can place himself at the water's edge and lift his hands in defiance, but the tide will come in and wash him out to sea anyway. The market is correcting and nothing is going to stop it.

MORE AT LINK--NONE OF IT GOOD NEWS

[formercia]

32. Ronnie Ray-Gun's coffin floats out of the grave

from so many people pissing on it.

[DemReadingDU]

46. Thanks! I love reading Mike Whitney

He always has a snarky comment...

"“Confidence”? Is that what it's called when the system is bailed out by Sugar-daddy Bernanke? "

[Demeter]

61. That was my comment

glad you liked it

[Dr.Phool]

34. National City in trouble?

http://blog.cleveland.com/business/2008/03/national_city_on_the_block_ana.html

National City on the block? Analysts are skeptical
Posted by Teresa Dixon Murray March 13, 2008 18:11PM
Categories: Breaking News, Impact

In what would be a stunning development, National City Corp. reportedly wants to sell out.

The Cleveland-based bank, largest in Ohio and ninth-largest nationwide, has started looking for potential buyers, according to anonymous sources quoted by the Wall Street Journal.

While the troubled bank in January hired Goldman Sachs to help it raise new capital, there has been no indication National City could be sold at a price that would be acceptable to shareholders.

The 163-year-old bank employs about 6,000 in Cuyahoga County and about 29,000 nationwide.

National City spokeswoman Kristen Baird Adams said the company has a long-standing policy of not discussing potential merger and acquisition deals. "We don't comment on speculation."

But she said she didn't know anything specific this week that could have spawned the sellout talk.

(snip)more


_________________________________________________

I remember about 5-1/2 years ago, when Cleveland City Council tried to crack down on predatory lenders. All the major banks who had big shares of the predatory lenders, dried up ALL mortgages in the city. They wouldn't write ANY mortgage for anyone in the city, until the city caved in.

I had a sale pending on my home there, and it collapsed at the last minute, and it spooked the buyer. It took another 4 years to sell that house. I was scrambling, because I was on the verge of losing the deal on my home in Florida. I had plenty of equity in the Cleveland home, and needed the sale for the down payment.

With top-tier credit, I went to my bank (National City) to apply for an equity loan to complete the Florida purchase. They wouldn't even give me an application.

[DemReadingDU]

56. There is a big bank in trouble

Yesterday, it was rumored to be Bear Stearns, but the article speculates Citigroup too. It wouldn't surprise me if all banks are in trouble.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3224350&mesg_id=3224451

[Ghost Dog]

35. Europe shares give up gains before US CPI data

Fri Mar 14, 2008 11:47am GMT
LONDON, March 14 (Reuters) - European shares turned flat by midday on Friday as U.S. futures lost ground ahead of key U.S. inflation data and as major oil stocks weighed.

At 1145 GMT, the FTSEurofirst 300 index was little changed at 1,268.08 points.

Investors geared up for U.S. consumer prices data at 1230 GMT for the latest glimpse on the state of the U.S. economy, even though Federal Reserve has made clear slowing growth is a primary concern as data continues to point to an economy on the brink of recession.

/.. http://uk.reuters.com/article/eurMktRpt/idUKL1491683220080314

[Ghost Dog]

43. Europe shares rise after U.S. CPI unchanged

LONDON, March 14 (Reuters) - European stocks rose on Friday, after unchanged U.S. consumer prices in February, in contrast to expectations for a rise, gave the Federal Reserve more room to cut rates to boost U.S. economic growth.

At 1233 GMT, the FTSEurofirst 300 index was up 0.7 percent at 1,277.47 points, having traded around 1,270.28 points right before the data was released.

Data showed cheaper energy and transportation prices helped keep overall consumer prices in check in February.

/.. http://www.reuters.com/article/marketsNews/idCAL1443794120080314?rpc=44

[Demeter]

45. Why Does Europe Buy the Lie?

Haven't they learned anything in the last 8 years?

[Ghost Dog]

50. I think some big companies are seeing potential rich pickings.

Some are already setting up new production facilities in the US to take advantage of cheap labor and cheap dollar...

and the generally highly 'deregulated' (aka. corrupt) environment... ?

[Demeter]

59. With What Money?

The fraud went global, and the greedy bought into it.

[Ghost Dog]

67. I think that still applies more to London than to mainland Europe's banks,.

and the ECB has supplied lots of liquidity, unlike the BoE. Big European companies (as reflected in these market indeces), and not just the explicitly or implicitly government-supported or participated ones, have or have access to capital. Smaller fry may also be hoping to pick something up, calculating the mid-term outlook may not be too grim (and will probably get their fingers burnt, imho).

But the UK economy is much more heavily weighted to housing and financial shenanigans and mindless consumption as in the USA.

Edit for clarity: Companies from Europe and elsewhere in the world will be investing in the USA, providing jobs in the USA and goods for sale both in the USA and (mostly) for export at low dollar prices to the rest of the world. Profits will be posted wherever head office is located.

[kineneb]

159. German companies- "offshoring" to US

listening to Karmabanque Radio (Max Keiser) yesterday, seems BMW and Sennheiser are increasing their onshore-US production, since good German labor makes their products too expensive to export.

[DemReadingDU]

39. Healthcare fraud trial in Columbus, Ohio - Guilty, Guilty, Guilty

3/14/08 Guilty, guilty, guilty, guilty ...
5 National Century executives face prison time for fraud

It seemed the jury had little doubt about the guilt of the former National Century executives accused of the nation's biggest private fraud.

After a day and a half of deliberation, the jury of eight women and four men came back with a determination of "guilty" for every one of the 40 charges against two of the Dublin company's founders and three of its former executives.

Startled, defense attorneys asked for the jurors to be polled individually to ensure that the guilty verdicts for Rebecca S. Parrett, Donald H. Ayers, Roger S. Faulkenberry, Randolph H. Speer and James E. Dierker Jr. were unanimous.

Dierker appeared so stunned he steadied himself on the table as he stood after the verdict. He was the only defendant to take the stand during the 5 1/2 -week trial.

Ayers, one of the company's founders and former vice chairman, walked up behind Speer and patted him on the back.

"Surprising," Ayers said.

Speer, the company's chief financial officer, agreed, adding, "It is what it is."

Though federal Judge Algenon L. Marbley could sentence any of the five to probation, sentencing guidelines suggest a minimum of 20 years in prison and maximum prison sentences that range between 55 and 140 years. Sentencing is expected in about three months.

For Ayers, who is just shy of his 72nd birthday; Parrett, who is 59; and Speer, who is 58, the sentences could amount to life in prison. That's possible, too, for the two defendants who still live locally: Faulkenberry, of Dublin, is 46; Dierker, of Powell, is 40.

Jury members declined to talk about the verdicts.

Assistant U.S. Attorney Doug Squires told the court that the next step will be going after the $1.9 billion that investors lost when National Century Financial Enterprises filed for bankruptcy in November 2002.

That could mean putting a lien on Ayers' second home and seizing defendants' bank accounts and cars, Squires said.


Jurors considered the defendants "guilty by association" to company CEO Lance K. Poulsen, Dickerson surmised. Poulsen, who prosecutors say orchestrated the scheme, is awaiting trial.

But federal officials praised the jurors' decision.

"By holding accountable those who break the law, today's convictions help restore some of the faith and trust the public loses every time corporate executives defraud their investors," Assistant U.S. Attorney General Alice S. Fisher said in a news release.

more...
http://dispatch.com/live/content/local_news/stories/2008/03/14/NatCen_verdict.ART_ART_03-14-08_A1_EK9L14N.html?sid=101


previous links...
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3224350&mesg_id=3224418


Edit to add a google link. Several papers are picking up this story today.
http://tinyurl.com/3cz25f

[Demeter]

44. Who Would Have Thought There Was Any Justice Left in America?

Certainly not I! Good for Ohio!

[DemReadingDU]

51. WooHoo!

:woohoo:

[Robbien]

54. They were surprised?

Goes to show how fraudulent behavior must be the norm in business circles.

[AnneD]

132. Can't figure out if they were...

Surprised they got caught or surprised they were prosecuted or surprised they were found guilty.

This is why I know it will be easy to go after GW Bush, Cheney, Rove et al. They are so arrogant in their belief that laws only apply to the little people.
:woohoo: :applause: :party: :toast: :woohoo:

[DemReadingDU]

143. All of the Above!

Arrogant, indeed

[hatrack]

199. It might not be their fault they were surprised . . . Maybe they're all economists!

:evilgrin:

[donkeyotay]

154. "today's convictions help restore some of the faith and trust"

Yes it does. It's nice to know a jury still thinks that people who steal from our healthcare system deserve to go to jail.

:toast:

[Ghost Dog]

185. There must be some mistake.

Appeal to the Supreme Court?

[DemReadingDU]

224. That seems odd, could not find that in any of the articles

Maybe it's been removed about the Supreme Court? I could only find references that the case would be appealed...

"Attorney Frederick Benton was convinced he and other defense attorneys had raised enough doubt.

"I thought we had it," Benton said, adding that Speer will appeal the verdict, though he declined to say on what grounds.

Next up in the saga are two trials for Poulsen. The 64-year-old National Century co-founder is scheduled to stand trial starting March 17 on charges he tried to bribe a government witness expected to testify against him in his fraud trial set for August.

A grand jury in October indicted Poulsen and associate Karl A. Demmler, 57, of Columbus, accusing them of attempting to bribe a government witness with $500,000 if she would develop "amnesia" when testifying. The government hasn't identified the witness, but court records indicate it's most likely Gibson.

Poulsen is being tried separately from his five colleagues because his original lawyers quit when he was indicted on the witness tampering charges."

http://sanantonio.bizjournals.com/columbus/stories/2008/03/10/daily27.html?t=printable

[Hugin]

204. Thanks for the updates!

It has certainly been an interesting process to observe. :)

[DemReadingDU]

226. to be continued

The trial is the first of four scheduled this year into the demise of National Century.

I will post updates when I find them.

:)

[Karenina]

234. Thanks DRD!!!

:thumbsup:

[UpInArms]

41. dollar watch

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

Last trade 72.167 Change +0.316 (+0.41%)

Despite Hot CPI, Euro Sells Off On Intervention Speculation

http://www.dailyfx.com/story/bio2/Despite_Hot_CPI__Euro_Sells_1205492347070.html

Eurozone CPI printed higher than expected as food and energy costs continue to rise. The year-over-year headline reading increased to 3.3% from 3.2%, and the core index rose 1.8%. Despite the implications of rising inflation, the Euro continued to sell off, as it had after setting a new all time high of 1.562 during Asian trading.

The region’s inflation story is worsening as oil continues to set records and food costs accelerated 5.8 percent. Additionally, labor costs increased as Union negotiations are starting to finalize and lock in wage increases. The ECB staunch hawkish stance is continuing to be justified as they try and prevent costs from deviating to far from their 2% threshold. This supportive data to their case, has led to expectations drastically decreasing that the ECB will cut rates by year’s end

Growing fears of a coordinated central bank intervention has traders ignoring the Euro bullish implications of the data and looking to lock in profits. As the ECB and U.S Treasury secretary Paulson have recently raised concerns over the weakening dollar, the possibility of an intervention is increasing. Although, many suspect that it is merely jawboning on their part cautious traders are starting to price in the possibility.

The Fed’s recent infusion of liquidity has many speculating that the next anticipated rate cut will not be as deep as expected. Today’s CPI reading will be a major influence in the MPC’s decision. Expectations are that the core index will ease to 2.3%, which despite being above the 2% threshold, will alleviate some concerns and may embolden the Fed to deliver the 75 point cut the markets expect. However, a rise in inflation will assuredly give Bernanke & Co reason to pause and may encourage dollar bulls, as speculation will increase that a smaller reduction is in the works.

...more...

Will the US Dollar Double Dip?

http://www.dailyfx.com/story/bio1/Will_the_US_Dollar_Double_1205442410324.html

For the first time in over a decade, one US dollar bought less than 100 Japanese Yen. USD/JPY dropped to a low of 99.77 in the early European trading session as news of Carlyle Group’s potential failure hit the news wires. The hedge fund had trouble meeting its margin calls last week and now, it faces outright liquidation. This sent shock waves across the markets, triggering a sharp drop in stocks, bond yields and the US dollar. The biggest fear right now is the possibility that the Federal Reserve is losing control. Each new step that they take has been nothing more than a band-aid for a growing problem. If the Carlyle Group defaulted, lenders will want to recover their funds immediately, forcing a liquidation of any open positions in the market. This would lead to another wave of volatility in the bond, stock and currency markets and at this point, the Federal Reserve has no choice but to cut interest rates by 75bp. Fed fund futures are back to pricing in a 94 percent chance of a 75bp rate cut, up from a 64 percent on Thursday. However, if they really want to do the right thing and put an end to the pessimism and risk aversion across the financial markets, they need to give the markets a surprise by cutting interest rates 100bp in one shot. Retail sales last month was very weak. The rise in food and gasoline prices have been too much for most consumers to handle and as a result, they have cut spending to the point where the decrease in demand has offset higher prices, making overall gasoline sales negative in the month of February. Interestingly enough, the US dollar did not fall on the retail sales report. There were a bunch of rumors floating in the markets about why the US dollar and stock market recovered intraday, but we do not believe that any of these reasons are compelling enough to prevent a double dip in the US dollar. The Associated Press reported that the Senate has extended some of President Bush’s tax cuts, but this is limited. Standard and Poors indicated that the worst may be over for large write downs, but their main focus was on the severity of the subprime problems while rumors circulated about a number of different parties including the Fed, providing capital to Washington Mutual, the struggling mortgage lender. There are many reasons to remain bearish US dollars. Even though tomorrow’s consumer price report could confirm inflationary pressures that will not prevent the Federal Reserve from cutting interest rates by at least another 150 to 200bp. Therefore even if the dollar is rebounding off its lows today, we expect it to dip back below 100 against the Japanese Yen.

...more...

[UpInArms]

92. while Wall Street cheered - the dollar is in its death throes - @ 71.79

01. Dollar sets new all-time lows against euro, Swiss franc
10:10 AM ET, Mar 14, 2008 - 1 minute ago

[Ghost Dog]

112. Euro= USD 1.560, GBP 0.768, CHF 1.576 and JPY 157.1 at this time

... time for this, although google's widgets seem particularly slow to update today ...

[Ghost Dog]

115. Dollar Below Parity Vs Swiss Franc Amid Bear Stearns Woes

Fri, Mar 14 2008, 14:29 GMT
NEW YORK (Dow Jones)--The dollar dropped below parity against the Swiss franc Friday morning for the first time and sank to another all-time low against the euro as problems at Bear Stearns (BSC) led U.S. stock markets to tumble.

News that JPMorgan Chase (JPM) partnered with the Federal Reserve to provide secure financing to the broker, which has exposure to the distressed mortgage-backed securities, stoked fears of more credit woes and more pain for the already weak U.S. economy.

Broad dollar-selling ensued, sending the euro to a new high of $1.5690, while the greenback sank to another 13-year low against the yen, at Y99.56. Against the Swiss franc, the dollar fell below parity, to CHF0.9987, its lowest mark ever.

"It's just pure fear across the board right now," said Geoffrey Yu, currency strategist at UBS. "People are reducing dollar exposure as much as they can...investors realize there is a problem with the banking system."

/... http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=7b87a7d1-d89a-48a3-8155-99ee9508f429

March 14 (Bloomberg) -- The Swiss franc rose to parity against the dollar for the first time after Bear Stearns Cos. was forced to seek emergency funding, fueling concern the U.S. is sliding into a recession and prompting investors to sell higher-yielding assets funded in Switzerland.

The franc has gained versus all 16 most-active currencies this year as the U.S. subprime-mortgage crisis led investors to exit so-called carry trades amid a slump in stocks. The currency has also benefited from speculation the Swiss National Bank will cut borrowing costs this year less than the Federal Reserve as the economy escapes the worst of the global squeeze on credit.

The franc ``enjoys the best of both worlds: the funding- currency status and a higher yield,'' said Peter Frank, a currency strategist in London at Societe Generale SA, which correctly forecast the franc would reach parity this quarter. ``It's got the safe haven bid in times of financial distress. I see a fairly significant appreciation coming.''

Against the dollar, the franc climbed as high as 0.9988 and was at 1.0038 by 3:25 p.m. in Zurich, from 1.0093 yesterday. The franc may gain to 0.96 in coming months, Frank said. It also traded at 1.5693 per euro, from 1.5787 yesterday.

/... http://www.bloomberg.com/apps/news?pid=20601083&sid=albpk95NTKr4&refer=currency

[Ghost Dog]

210. Euro= USD 1.566, GBP 0.773, CHF 1.568 and JPY 156.3 at this time

At least we have an update here...

[Lasher]

118. Dollar watch

[ozymandius]

47. Futures numbers suggest widespread use of crack, crystal meth.

08:30 am : S&P futures vs fair value: +5.0. Nasdaq futures vs fair value: +10.5. Futures spike on a better than expected inflation reading on now point to a positive start to the trading day. Just reported, February CPI was uncchanged, compared the expected rise of 0.3%. Excluding food & energy, CPI was also flat, which was less than than the expected rise of 0.2%. That leaves CPI up 4.0% year over year, and core CPI up 2.3% year-over-year.

08:03 am : S&P futures vs fair value: -9.3. Nasdaq futures vs fair value: -13.8. Futures point to a lower start as market participants await the February CPI report that is set for release at 8:30 ET. In corporate news, National City (NCC) had its credit rating downgraded at Moody’s due to the bank's second-lien home equity and real estate exposure. Boeing (BA) is set to mover higher after being upgraded to Overweight from Equal-weight at Morgan Stanley. Meanwhile, fellow Dow component Exxon Mobil (XOM) was upgraded to Outperform from Neutral at Credit Suisse.

[burf]

55. I had CNBC on the

TV and they were attributing it to the good CPI numbers.

[TheWatcher]

64. The FAKE CPI Numbers is more like it.

The CPI is unchanged.

And Star Wars really happened.

Baron Munchausen was a real, historical figure.

Pigs can fly.

Bush is honest.

[TheWatcher]

60. An irrational reaction to fictional numbers in a faux Free Market.

That about sums it up.

This is your Stock Market.....

http://www.smh.com.au/ffximage/2007/02/28/wall_street_stock_exchange_narrowweb__300x468,2.jpg



This is your Stock Market on Government Data......



Any Questions?

[Hissyspit]

48. And that was the week that was.

Scary wasn't it?

(Well, technically it's not over.)

[UpInArms]

52. An Exchange International Securities Official Is Charged with insider trading

http://www.nytimes.com/2008/03/14/business/14insider.html?ex=1363147200&en=19ec82dcdb2b6cef&ei=5088&partner=rssnyt&emc=rss

The vice chairman of the International Securities Exchange, an options and stock exchange in New York, was charged with insider trading on Thursday, accused of leaking confidential information about the $2.8 billion takeover of the market last year.

Federal prosecutors said that the vice chairman, John Marshall, obtained nonpublic information about the pending deal and provided it to two business partners at a financial consulting firm, who also were charged.

The International Securities Exchange said Mr. Marshall resigned on Thursday.

The charges stem from the purchase of the exchange by Eurex Frankfurt, a derivative exchange owned by Deutsche Börse and the SWX Swiss Stock Exchange, prosecutors said.

...more...

[TheWatcher]

53. How in the world they expect anyone with a thinking, functioning brain to believe that the CPI is

unchanged is off the charts.

I haven't believed the Government economic data for some time, and the CPI has always been a joke, but come on people, they are just making things up now. This is pure fiction.

And they must be plenty confident that the Public is so stupid they will just nod thier heads, drool, and go back to grazing in the Cathode Fields.

Oh I know, that's just crazy conspiracy thinking, and it doesn't exist, and everything is really fine, and the Government would NEVER make up fake data to artificially prop or influence the Markets.

What could I have POSSIBLY been thinking.

[UpInArms]

63. g'morning to you!

and everyone (to my knowledge) that visits this thread agrees with you - these numbers are strictly made up to boost the stock market.

Wasn't it Mark Twain that said "There are three types of lies: lies, damn lies and statistics"?

[TheWatcher]

65. Indeed, my friend, indeed.

But to be honest, I have never seen it this blatant before.

Like I said, they are literally making things up here. They are sticking it in our faces and saying, "Yeah, so?"

I know that many people would just shrug their shoulders and look at me like I have six heads making this big a deal about it, but what it means to me is that this is basically an admission that these Markets are no longer functional in any traditional way.

This is just a Casino now. And the message I get from this is clear.

We, the top percentile of the economic food chain are going to resort to anything to save our status quo, and if that means at the expense of everyone and everything else, so be it. We are going to survive, even if it means destroying the foundation of everything around us.

If we lose, the rest of you lose with us.

And I have the worst feeling that in order for them to survive, everyone else must go down into the murky depths of the North Atlantic while they get the life boats.

The precedent being set and conveyed here is frightening.

[UpInArms]

68. this mal-administration has a scorched earth policy and

what they are doing to the fiscal side of this country is no different that what they have done to the diplomatic side - they have been intent upon destroying everything we have ever known to be our country in a thorough and systemic fashion.

[Ghost Dog]

150. It's a Casino and the House is crooked

and many of the big playerz are in league with the Croupier and the House.

[Hugin]

192. They're all in on it...

It *may* be unchanged for Feb... But, it's taken a huge leap since then.

Or so my weekly budget is telling me. ;)

[UpInArms]

57. All Told, the Price Tag for Citigroup's New Chief Is $216 Million (since January)

http://www.nytimes.com/2008/03/14/business/14citi.html?ex=1363147200&en=318ecf9d8b2ebd1c&ei=5088&partner=rssnyt&emc=rss

Call him Citigroup’s quarter-billion-dollar man.

Vikram S. Pandit was paid nearly that much for taking over as chief executive of the embattled bank. Mr. Pandit received about $165.2 million in connection with the sale of Old Lane Partners, the investment firm Citigroup bought last April for as much as $800 million to lure him to the company. He received an additional $2.7 million in annual pay in the roughly six months he led Citigroup’s investment bank and alternative investments group.

And in January, Mr. Pandit was given a sign-on grant of stock and performance-based options worth over $48 million, though the options currently no cash value. That brings the total to at least $216 million.

Details of Mr. Pandit’s pay and that of several other top executives were found in Citigroup’s proxy statement, released Thursday. Unlike other Wall Street firms that withheld bonuses for their senior management teams, Citigroup gave at least six executives $1 million or more.

Charles O. Prince III, who abruptly resigned as chief executive in November, was given a $10.4 million bonus when he left.

In theory, Mr. Pandit and three other top executives received only their salary in 2007 because of Citigroup’s poor performance — shares tumbled 47 percent, and the bank had more than $20 billion in write-offs. The three were Lewis B. Kaden, a vice chairman to whom the bank’s chief risk officer had previously reported; Michael S. Klein, the co-head of Citigroup’s investment bank; and Stephen R. Volk, another vice chairman.

In practice, they were given multimillion-dollar deferred cash and equity awards in January. Mr. Kaden added $8.3 million to his $500,000 salary in 2007, according to an analysis by Equilar, an executive compensation research firm. Mr. Klein received cash and equity awards worth $19.3 million in addition to his $212,500 salary. Mr. Volk was paid $10.3 million of similar awards on top of his $212,500 salary.

...more...

[wordpix]

163. WTF---keep feeding the fat pigs while the rest of the animals starve!

[Hannah Bell]

194. Charles O. Prince III

any relation to the blackwater prince?

[Robbien]

196. Citigroup Chief Signals Major Asset Sales

Citigroup Inc. (C) Chief Executive Vikram Pandit has begun separating the wheat from the chaff in the New York financial giant's global empire - and there looks to be a big pile of chaff.

Pandit met with stock analysts Thursday and confirmed the bank plans to shed assets to reorganize its business. Analysts from Credit Suisse who attended the meeting said the giant bank is preparing to shed hundreds of billions of dollars worth of assets to support a turnaround that could take a number of years.

http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20080314-000680-0947

Pandit gets a huge paycheck to arrange a big fire sale of the company's assets. Just doesn't make sense.

[Demeter]

58. Our three-decade recession: quality of life has been going downhill since 1975. By Robert Costanza

Cost post from Ed. Thread

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

http://www.latimes.com/news/opinion/commentary/la-oe-co...

From the Los Angeles Times


The news media and the government are fixated on the fact that the U.S. economy may be headed into a recession -- defined as two or more successive quarters of declining gross domestic product. The situation is actually much worse. By some measures of economic performance, the United States has been in a recession since 1975 -- a recession in quality of life, or well-being.

... GDP was never intended to be a measure of citizens' welfare -- and it functions poorly as such. Yet it is used as a surrogate appraisal of national well-being in far too many circumstances.
The shortcomings of GDP are well known, and several researchers have proposed alternatives that address them, including William Nordhaus' and James Tobin's Measure of Economic Welfare, developed in 1972; Herman Daly's and John Cobb's Index of Sustainable Economic Welfare, developed in 1989; and the Redefining Progress think tank's more recent variation, the Genuine Progress Indicator. Although these alternatives -- which, like GDP, are measured in monetary terms -- are not perfect and need more research and refinement, they are much better approximations to a measure of true national well-being.

The formula for calculating GPI, for instance, starts with personal consumption expenditures, a major component of GDP, but makes several crucial adjustments. First, it accounts for income distribution. It then adds positive contributions that GDP ignores, such as the value of household and volunteer work. Finally, it subtracts things that are well-being-reducing, such as the loss of leisure time and the costs of crime, commuting and pollution...While the U.S. GDP has steadily increased since 1950 (with the occasional recession), GPI peaked about 1975 and has been relatively flat or declining ever since. That's consistent with life-satisfaction surveys, which also show flat or dropping scores over the last several decades...This is a very different picture of the economy from the one we normally read about, and it requires different policy responses. We are now in a period of what Daly -- a former World Bank economist now at the University of Maryland -- has called "uneconomic growth," in which further growth in economic activity (that is, GDP) is actually reducing national well-being.

How can we get out of this 33-year downturn in quality of life? Several policies have been suggested that might be thought of as a national quality-of-life stimulus package. To start, the U.S. needs to make national well-being -- not increased GDP -- its primary policy goal, funding efforts to better measure and report it. There's already been some movement in this direction around the world. Bhutan, for example, recently made "gross national happiness" its explicit policy goal. Canada is developing an Index of Well-being, and the Australian Treasury considers increasing "real well-being," rather than mere GDP, its primary goal...Once Americans' well-being becomes the basis for measuring our success, other reforms should follow. We should tax bads (carbon emissions, depletion of natural resources) rather than goods (labor, savings, investment). We should recognize the negative effects of growing income disparities and take steps to address them.





Robert Costanza is the director of the Gund Institute for Ecological Economics at the University of Vermont.

[UpInArms]

66. Animal Farm redux - new ways to lie: SEC to widen range for asset valuations: report

http://news.yahoo.com/s/nm/20080314/bs_nm/sec_valuations_dc

NEW YORK (Reuters) - The U.S. Securities and Exchange Commission is expected to tell public companies they can give investors a wider range of possible market values for hard-to-price assets, the Wall Street Journal reported on Friday.

The Journal said the guidance is aimed at giving investors more information about prices that are difficult to gauge because many markets have seized up in recent months.

The SEC plans to tell companies as soon as next week they can provide ranges for the values that surround market prices, said the Journal.

The paper cited Chairman of the House Financial Services Committee Barney Frank, a Democrat from Massachusetts, saying there is an urgent need to look at mark-to-market accounting because it is having a "downward pull" on the economy.

...more...

[Robbien]

116. Shame on Barney Frank

I expected better from him.

Not mark to market? A time tested GAAP for classifying assets to just be thrown out the window?

[UpInArms]

69. Bonds extend gains on severe recession remarks

http://www.reuters.com/article/bondsNews/idUSNYG00098120080314

NEW YORK, March 14 (Reuters) - U.S. Treasury debt prices extended gains on Friday, after a prominent economist said the U.S. economy is now in a recession which could be acute.

Former National Bureau of Economic Research President Martin Feldstein said that the current recession could be "substantially more severe" than the last few.

...a bit more...

[UpInArms]

70. US faces severe recession-economist Feldstein

http://www.guardian.co.uk/feedarticle?id=7384681

BOCA RATON, Florida, March 14 (Reuters) - The United States has entered a recession that could be "substantially more severe" than recent ones, former National Bureau of Economic Research President Martin Feldstein said on Friday.

"The situation is very bad, the situation is getting worse, and the risks are that it could get very bad," Feldstein said in a speech at the Futures Industry Association meeting in Boca Raton, Florida.

and just 10 days ago, he was saying this:

March 4, 2008, 10:26 am
Feldstein: Dollar Decline Not a Worry

http://blogs.wsj.com/economics/2008/03/04/feldstein-dollar-decline-not-a-worry/?mod=googlenews_wsj

The decline in the U.S. dollar isn’t worrisome, and reflects a normal adjustment in global imbalances, Martin Feldstein, professor at Harvard University and head of the National Bureau of Economic Research, said.

“The decline in the dollar is part of a normal market process, it really should not worry us,” the influential economist said.

The dollar’s decline, which Feldstein estimated at 20% on a trade-weighted basis since 2003, “is key to shrinking the global imbalances” which include a massive U.S. merchandise trade deficit.

Even if the dollar were to drop another 20% — a scenario that Feldstein stressed he isn’t forecasting — it would only offset about one-tenth of the growth in real gross domestic product over the next decade.

...more...

someone must have clobbed him with the clue stick :shrug:

[Demeter]

71. Isn't the Fed Meeting Next Week?

Think they'll do something stupid, again?

[UpInArms]

73. on the 18th - fed futures traders have already priced in a 75 bp cut

won't that be fun?

[Demeter]

75. Reminds me of that scene in the Muppet Movie

"Plummeting? Well, you can try it, once."

[UpInArms]

108. RATE FUTURES-Growing chance of 100 bps Fed rate cut next week

http://www.reuters.com/article/bondsNews/idUSNYE00024620080314

NEW YORK, March 14 (Reuters) - U.S. interest rate futures rose on Friday, showing a growing likelihood that the Federal Reserve will lower its benchmark short-term U.S. target rate by 100 basis points next week to revive a weakening economy.

The March fed funds futures contract implied that traders briefly saw a 40 percent of a 100-basis-point move after Fed's policy meeting next week. At the end of Thursday, traders had not priced in such a steep rate cut.

[Robbien]

117. CNBC is saying that they are also starting to price in a one twenty five point cut

Soon there won't been anything left to cut from.

Geeze

[UpInArms]

121. I shall mourn the dollar - that thing that helped to make our economy run for a very long time

(edited for typo)

[Demeter]

129. They Wouldn't Dare!

If that happens, the next step would have to be handing out paper dollars on the street....and not just Wall Street.

Of course, if any of that cash actually made it to a consumer, the recession would vanish....

[radfringe]

134. what should be on every t-shirt, sign, bumpersticker, news crawler

and the lips of every american:

WHERE'S THE
FREAKING
TRICKLE?

[Hugin]

190. Oh, beautiful message!

:rofl:

Glad to see one of your toons in the OP. :thumbsup:

[radfringe]

227. thanks

this thread is the only reason I'm even still posting here...

been elsewhere, but if I tell you in this response I'll get ts'd.. pm me if you want to know where

[AngryOldDem]

76. Bear Stearns bailout

I just woke up and turned on CNBC and it's breaking news there that the Fed has authorized basically a 28-day bailout of Bear by JP Morgan Chase. How serious is this in the scheme of things? Can someone give me some background on this? What if an entity like Bear Stearns fails?

[UpInArms]

78. Bear Stearns is an investment bank - meaning it is not a "bank" in the normal sense

supposedly, what BS holds would be larger investors' portfolios - I am not certain how endangered those would be, as they would be assets of the investors - not BS - they don't normally play roullette with their own money - but they may have tied up a lot of the corporate funds in those worthless derivative investment vehicles

:shrug:

JPMorgan, NY Fed to provide Bear Stearns financing

NEW YORK (Reuters) - JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) on Friday said it, along with the Federal Reserve Bank of New York, agreed to provide secured funding to Bear Stearns, as necessary, for up to 28 days.

The Fed, through its discount window, will provide non-recourse, back-to-back financing to JPMorgan Chase, the commercial bank said. JPMorgan said it does not believe this transaction exposes its shareholders to any material risk.

JPMorgan Chase also said it is working with Bear Stearns on securing permanent financing or other alternatives for the company.

<snip>

"Amidst this market chatter, our liquidity position in the last 24 hours had significantly deteriorated. We took this important step to restore confidence in us in the marketplace, strengthen our liquidity and allow us to continue normal operations."

...a bit more at link...

[AngryOldDem]

82. Thanks...

I'm rather a neophyte (no, make that dummy) at matters such as this, but when I heard this I could not help but think how something like this could spread throughout the rest of the industry. I look at all this and I wonder just how stable the financial industry is right now.

[UpInArms]

85. a picture is worth a 1000 words

[4dsc]

89. They are going nuts this morning

Looks like they are praying for a bailout of Bears Stearns.. Looks like more RATE CUTS by the Feds as well.. Makes me wonder how cheap they need to make the cost of money to help these failing enities..

[InkAddict]

97. Grinding up the tin-foil hats and forming it into wampum.

Judging by what happened a few minutes ago, someone(s) counted coup. (No offense to the American Indian from whom we should have learned some ethics about living in whatever environment).

[InkAddict]

91. Is it me, or are we now playing musical debt?

Fed bails out banks some and takes bad debt collateral; JP gives funds to BS for short-term bail-out and Fed returns the "favor" to JP???? What is the Fed actually returning to JP but more fiat monetary debt which is sinking rapidly in value? Who gets stuck with the bag??? One guess.

[DemReadingDU]

122. The Game is Over

Saw this blog posting last week...
3/9/08 The Game is Over
JPM states that Wall Street banks are facing a "systemic margin call", in other words a margin call that will pervade through the system (a margin call takes place when a broker tells a borrower to put more collateral for a loan in place, for instance when the existing collateral has lost value; the typical term for this sort of margin call is 72 hours)

The banks will have to cough up $325 billion, and fast, if and when called upon, or their assets will be sold off for whatever the creditor can get for them.

The only way the banks can do this is by calling in their own loans and/or selling their assets. That means urgent phone calls to smaller banks, hedge funds, and any other funds and businesses, first those that depend heavily on borrowed money to fulfill oblgations. These parties then need to do the same: call in what is owed to them.
http://theautomaticearth.blogspot.com/2008/03/debt-rattle-march-9-2008-game-is-over.html

here some discussion from last week
3/9/08 GliderGuider
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x2979357

[Robbien]

128. Didn't ya hear? The Crisis is Over. The S&P said so.

One can bet that whomever told the S&P to issue that statement yesterday wasn't in the loop on the overnight negotiations for the Bears Stearns bailout.

The next time S&P rings the bell for the end of the crisis the Wall Streeters may not believe them.

[DemReadingDU]

131. Yep

Calling wolf too many times

[MilesColtrane]

137. The buck now stops overseas.

Once foreign investors get tired of throwing their money down the grease trap that is the current economy, then the real fun begins.

My post-apocalyptic name will be Mad Mil-Col.

I've already got the leathers and the Mossberg 500.

[Birthmark]

153. Can I call you "MMC" for short.

I'll hand you clips as needed. lol

[Ghost Dog]

156. .

http://bp1.blogger.com/_hMe2tPlWL14/R7hux57sh8I/AAAAAAAAACc/KmOTRKZVlJg/s400/fuck+you.jpg
http://docs.google.com/TeamPresent?docid=ddp4zq7n_0cdjsr4fn&skipauth=true

[kineneb]

165. count me in

no motorcycle or leathers, but my aim is real good...

(cue up Wagner's "Ride of the Valkyrie")

channeling German/Norwegian ancestry... have spear, will get magic helmet...

[MilesColtrane]

171. Absolutely.

The more of us banded together, the easier it will be to fend off mutant marauders and other Republicans.

[Roland99]

126. Bear Stearns stock down 46.6% at the moment.

[Robbien]

155. Bear is a broker-dealer for many big hedge funds and wealthy individuals

Can't let the hedge funds and rich folk get caught here without a net.

[UpInArms]

79. 9:53 EST Who spooked the cattle?

Dow 12,044.71 101.03 (0.83%)
Nasdaq 2,247.27 16.34 (0.72%)
S&P 500 1,303.87 11.61 (0.88%)
10-Yr Bond 3.455% 0.079

NYSE Volume 405,477,843.75
Nasdaq Volume 211,474,984.375

09:45 am : It was shaping up to be a negative open until a better than expected inflation reading caused the market to rebound. Stocks are trading with modest gains.

Just reported, February CPI was unchanged, compared the expected rise of 0.3%. Excluding food & energy, CPI was also flat, which was less than than the expected rise of 0.2%. That leaves CPI up 4.0% year over year, and core CPI up 2.3% year-over-year.

The stock market has traded in choppy fashion following news that Bear Stearns (BSC) will receive financing as needed from JPMorgan Chases and the Federal Reserve Bank of New York. Bear said the rumors that it was facing liquidity issues caused its liquidity position in the last 24 hours to deteriorate.
DJ30 +32.97 NASDAQ +11.27 SP500 +4.49

09:15 am : S&P futures vs fair value: +15.0. Nasdaq futures vs fair value: +19.2. Futures extend their gains. JPMorgan Chase and the Federal Reserve Bank of New York will provide financing for Bear Stearns as necessary. Shares of Bear Stearns spiked in pre-market trading.

09:00 am : S&P futures vs fair value: +6.5. Nasdaq futures vs fair value: +12.8. Futures contine to suggest a positive open thanks to the better than expected inflation reading.

[antigop]

81. Morning...one sort of snarky comment and then I'll be out most of the day

Part of the election debate this year has centered around "experience" and how important it may or may not be.

I give you this man's "experience":
http://www.whitehouse.gov/cea/bbernankebio.html


I give you this quote from Time Magazine:

http://www.time.com/time/health/article/0,8599,1717927,00.html

And in the end, determining which of the presidential candidates pays more attention to your concerns requires not adding up their years of experience but a far more complex calculation: deciding what their experiences have led them to truly value.

Even though Bernanke is not running for president, I think the question is valid:

What has Bernanke's experience led him to truly value?

<edit> for clarity in first sentence.

[UpInArms]

84. 10:02 EST Now THAT is going to leave a mark! Dow is down 260 and falling fast

Dow 11,885.39 260.35 (2.14%)
Nasdaq 2,210.50 53.11 (2.35%)
S&P 500 1,282.48 33.00 (2.51%)
10-Yr Bond 3.44% 0.094

NYSE Volume 585,547,375
Nasdaq Volume 311,130,968.75

[UpInArms]

87. 10:06 EST miraculous recovery in progress!

Dow 11,948.89 196.85 (1.62%)
Nasdaq 2,226.42 37.19 (1.64%)
S&P 500 1,290.71 24.77 (1.88%)
10-Yr Bond 3.447% 0.087

NYSE Volume 685,840,750
Nasdaq Volume 331,013,750

01. <$INDU> Dow industrials fall 300 points as Bear Stearns slides
10:04 AM ET, Mar 14, 2008 - 57 seconds ago

03. Bear Stearns shares fall 47%
10:03 AM ET, Mar 14, 2008 - 1 minute ago

[spinbaby]

88. But wait, it just came up 100

Whiplash.

[UpInArms]

94. that was the new interest rate cut boogie - check the dollar

[UpInArms]

105. now pricing in a 22% chance of a 100 basis point rate cut - I think I'm gonna puke

Fed funds futures are now pricing in a 22% chance of a 100 basis point rate cut, with the rest of the odds on a 75 basis point cut. There was no chance of a 100 basis point cut yesterday.

will someone hold my hair?

:puke::puke::puke::puke::puke::puke:

[Roland99]

127. Why not just cut it to 0% already. get it over with.

:eyes:

[InkAddict]

93. Quickly recovering now, not 10 minutes later?

:wtf:

Down 154.11 @ 10:15 am

[UpInArms]

95. helicopter money into the investment banks

10:17

Dow 12,071.09 74.65 (0.61%)
Nasdaq 2,245.10 18.51 (0.82%)
S&P 500 1,303.75 11.73 (0.89%)
10-Yr Bond 3.406% 0.128

NYSE Volume 923,910,000
Nasdaq Volume 438,831,156.25

[dreyer]

86. Plan always ends with Rob the People

Problem is the illegal white house occupant is incapable of thinking of any plan that doesn't have the same solution:

Plan A- p80q342780uct0i = rob the people

Plan B- lqaw0u23-9u-fwq-= rob the people

or Plan C- 94u39q4g3j-9qug-u= rob the people

[UpInArms]

90. hiya, dreyer!

welcome to DU and to the SMW!

robbing the people is always high on the BFEE's agenda

:hi:

[dreyer]

220. Thanks for Welcome

It's nice to talk with a group that with some vision and common sense. Democrats knew back in 2000 that letting a brain damaged monkey drive a car is a disaster. And now as the Repukes go over a cliff, with their monkey at the wheel they are all shocked?? What is SMW?

[AnneD]

228. Dreyer....

you forgot Plan F- 94u39t4g3m-9qug-q= Screw the people. :hi:

SWT refers to this thread...Stock Watch Thread. A we fry em you buy em kind of place.

[UpInArms]

98. April gold hits record high of $1,007.30 an ounce on Nymex

02. April gold last up $11.20 at $1,005 an ounce on Nymex
10:17 AM ET, Mar 14, 2008 - 5 minutes ago

03. April gold hits record high of $1,007.30 an ounce on Nymex
10:15 AM ET, Mar 14, 2008 - 7 minutes ago

[Theres-a]

99. Congratulations, goldholders!

Sorry, canned good holders.(That would be me.)

[AnneD]

136. Hey....

In times of trouble-canned goods are better than money in the bank and always a part of my budgeting. It was called home economics for a reason.

[Ghost Dog]

160. I was re-watching Fellini's "Roma".

In an early (dark, b/w post-war) scene, two ragged beautiful women are walking through a (rural) devastated landscape. One comments to the other: "My cousin says, in America, everyone gets to eat canned food" (as if that's luxury - the women are just bored with living off the land). I know which I'd prefer...

[kineneb]

167. eating trees is only fun for Euel Gibbons

they probably wanted something more substantial, Spam maybe? Not too much available on European land in winter...

[Ghost Dog]

182. For sure. The scene was winter. Bottling, and drying would have been the method...

Italy has always (usually) been very rich in food ;-(

Ed. The contrast in the film is with all the well-dressed fat-pig postwar fascists and camp followers.

[UpInArms]

100. Fed says to bend over and kiss your ass good-bye

01. Fed: Will continue to provide liquidity to financial system
10:23 AM ET, Mar 14, 2008 - 3 minutes ago

02. Fed says monitoring market developments closely
10:23 AM ET, Mar 14, 2008 - 3 minutes ago

03. Fed says board approved Bear Stearns J.P. Morgan arrangement
10:23 AM ET, Mar 14, 2008 - 3 minutes ago

[UpInArms]

107. Paulson goes orgiastic over treasury drainage into bankers pockets

01. Paulson confident market disrupution will be minimized
10:42 AM ET, Mar 14, 2008 - 2 minutes ago

02. Paulson says appreciates Fed leadership on Bear Stearns
10:42 AM ET, Mar 14, 2008 - 2 minutes ago

03. Paulson: Bear Stearns is another challenge for regulators
10:42 AM ET, Mar 14, 2008 - 2 minutes ago

[MilesColtrane]

141. "Paulson says appreciates Fed leadership on Bear Stearns"

"Bush surrogate says, "Heckuva job Benny!"

[UpInArms]

101. GM recalls 207,000 Buick Regal, Pontiac Grand Prix: report

01. GM recalls 207,000 Buick Regal, Pontiac Grand Prix: report
10:29 AM ET, Mar 14, 2008 - 1 minute ago

[Demeter]

102. "Hey Rocky, Watch Me Pull a Rabbit Out of My Hat"

"But that trick never works!"

"This time for sure!"


Wonder which member of the family Leporidae will be summoned today....


the usual dumb bunny, no doubt. The American citizens and dollar holders.

[callous taoboy]

111. "Whoops! Must've brought the wrong hat!"

[InkAddict]

114. Twicky wabbit - How's this

http://sashi.wordpress.com/2005/10/26/the-vanishing-coin-trick/

Note the phrase on the rings?

[UpInArms]

104. US financials face more losses from home loans-Fitch

http://www.reuters.com/article/bondsNews/idUSWNA733420080314

NEW YORK, March 14 (Reuters) - U.S. financial institutions are likely to face more losses from home equity loans, as home prices continue to deteriorate and consumer debt levels rise, Fitch Ratings said on Friday.

"Loans originated through third-parties, loans collateralized by property in markets with more home price depreciation and/or higher current loan-to-value ratios, and loans with anything less than full borrower documentation are generally exhibiting more stress," Fitch said in a report.

"A particularly toxic situation emerges when more than one of these characteristics is layered onto the product," Fitch said.

...more...

[UpInArms]

106. 10:42 EST Bag outta tricks - now down 225 and falling again

Dow 11,920.31 225.43 (1.86%)
Nasdaq 2,215.38 48.23 (2.13%)
S&P 500 1,285.64 29.84 (2.27%)
10-Yr Bond 3.414% 0.12

NYSE Volume 1,341,922,375
Nasdaq Volume 636,804,062.5

10:35 am : The major indices continue to post significant losses, but have recovered from their worst levels. All ten sectors are trading lower.

The Federal Reserve issued a press release that stated it is "monitoring market developments closely and will continue to provide liquidity as needed." The Board unanimously approved the JPMorgan Chase (JPM 366.66, -1.45) and Bear Stearns (BSC 31.47, -25.53) arrangement.

Fed funds futures are now pricing in a 22% chance of a 100 basis point rate cut, with the rest of the odds on a 75 basis point cut. There was no chance of a 100 basis point cut yesterday.

DJ30 -134.40 NASDAQ -28.36 SP500 -18.77 NASDAQ Dec/Adv/Vol 1845/666/526 mln NYSE Dec/Adv/Vol 2305/552/375 mln

[AnneD]

109. The weekend is near, Bush is talking about the economy...

It's time to post our........

Turn Back the Hands of Time Pool

Seems like we are getting closer by the week now. Guess the date the DJIA rolls back to the level it was when the chimp took office-10,578.24. You can revise your dates up until Labour Day (the working man's holiday)or the DJIA hits 11000 (got to have a cut off). Anyone can join, just give a date and your reasoning for that date.

the other one.....1/30
DemReadingDU.....2/29
Ther-s a.....3/15
Demeter.....3/24
Talking Dog.....3/28 at 2 pmish
Warpy...3/20
Dr. Phool.....4/1
dewller.....4/8
FinnFan.....4/10
Karenina.....4/15
ProgressiveRealist.....4/17
Mattsh.....4/22
DeminSoCal.....4/22
Demeter.....4/24 hope that's right-I left both on.
GhostDog.....4/28
MilesColtrain.....5/2
Happyslug.....5/9
AzDemDist6.....5/15
InkAddict.....7/3
UIA.....7/15
Roland99.....7/28
Abelenkpe.....8/2
Kineneb.....8/8
Prag.....9/5
MoJo Rabbit.....9/5
MuleBoy(aka hiz honna da mayor).....9/11
Nickster.....9/12
Birthmark....10/10
AnneD....10/24
Neshanic.....10/24
MsLeopard.....10/31
Wordpix.....11/3
Ship wrack.....11/5

Get your dates in before the next rate cut.:eyes:

Edited to add my disclaimer:
Remember-you can change the dates as we learn more. The winner get the praise and admiration of those on the Stockwatch Thread. No animals were hurt in creating this pool-although I did have to push my cat Sampson of the keys a time or two.. No monopoly money will exchange hands and no Reggie bars are allowed in this pool.....

[Demeter]

125. I'll Hold With My Latest Choice--Easter Monday

when all the jelly beans turn out to be painted rabbit poop, and we don't even want to go into the chocolate eggs!

[DemocratInSoCal]

130. I Would Like Tuesday April 22, 2008 Please nt

[Birthmark]

198. Looks like Demeter, Warpy, and Talking Dog...

...have a real shot if things keep going at this rate.

[radfringe]

208. given the DOW's numbers at this moment

there's an approximate 1300 point difference

market has dropped approx 2000 in the past 3 months, average that out to 666.66 per month

my prediction: Friday before Memorial Day may 23...

bush can appear with or without a codpiece and declare misson accomplished

[progressive_realist]

217. Our distribution of guesses peaks the second half of April

I find it interesting that as the number of guesses increases, the clustering around that point gets denser. Considering the amount of information we collectively have, I won't be surprised if we end up getting it exactly right -- down to the day. Especially once the final rearrangement of guesses happens at 11,000.

[AnneD]

221. Feel free...

to plot the data. April and Oct were the most common months quoted but since Feb more guesses for April have been posted. I'm leaving my Oct date but I think it will be much sooner.

Our next pool will be the Limbo Pool-How Low Can It Go. This has actually been fun to do and I hope everyone has enjoyed it.

[mdmc]

113. thanks for the info

:kick:

[SlowDownFast]

119. Holy fuck I just made SO much $ shorting Bear Stearns!

Anyone into options?

Do you believe that the market NEEDS to crash (whether quickly or slowly) and the fundamentals are there for the sort of "reset" we need?

Sick of the pumpmonkey/disinfo bullshit on CNBC and feel like you're not getting the truth?

Visit http://www.tickerforum.org/cgi-ticker/akcs-www

Lots of cutting edge market news and tips...

[AnneD]

135. Thanks for...

the site. One day, when I have a little play money, I would love to play options.

[distantearlywarning]

187. I made thousands this morning shorting Bear Stearns.

Sadly, those dollars were only in my virtual portfolio. :-(

But then I called hubby up and said, "I could have made us lots of money this morning if you'd have let me put it all into a Bear Stearns short like I wanted to!"

Then he agreed to give me $500 more next week for playing with. :-D

[Roland99]

133. The Propagandist catapaults!!!!

11:25Bush says economic foundation is solid
11:24Bush says U.S. economy is resilient and will recover

[Demeter]

138. Dow drops another 100 points

It goes without saying, and with saying, it goes even lower!

[UpInArms]

139. PIEHOLE ALERT: Stuuupid falls out

01. Bush says economic foundation is solid
11:25 AM ET, Mar 14, 2008 - 1 minute ago

02. Bush says U.S. economy is resilient and will recover
11:24 AM ET, Mar 14, 2008 - 2 minutes ago

03. Bush: "Our economy is obviously going through a tough time"
11:23 AM ET, Mar 14, 2008 - 3 minutes ago

[hatrack]

142. OK Chimp, if our economic foundation is solid, why the "tough time"?

I'm a-skeered - he's going to be facing hardball questions from Paul Gigot at his Big Economy Reassurance Speech - what will Gigot's verbal pummeling do to market confidence?!?!?

:eyes:

[UpInArms]

144. **smirk** Heck-of-a job, bennie! **smirk** **smirk**

02. Bush: Housing market is in process of correcting itself
11:34 AM ET, Mar 14, 2008 - 10 minutes ago

04. Bush believes Fed actions will help ease credit crunch
11:29 AM ET, Mar 14, 2008 - 15 minutes ago

05. Bush: Bernanke is doing a good job under tough circumstances
11:28 AM ET, Mar 14, 2008 - 16 minutes ago

[fascisthunter]

147. What Sacrificial Lambs Will Be Offered

to keep that number above 12000. After all, can't allow a Republican President to look like a total failure.:sarcasm:

[MilesColtrane]

148. Just calculated that...

...my BushCo Economic Stimulus™ Check...Payday Loan will keep gas in my car for a WHOLE MONTH! :mad:

[4dsc]

152. Bush to push for bailouts!!

Larry Kudlow to interview Bush tonight on CNBC and Bush states he's thinks bailouts are OK given today's credit crisis..

[CatholicEdHead]

157. Kudlow?

:puke:

Why am I not surprised he is told to do this interview (notice on his blog they have turned comments off).

So, W will field softball questions from Larry, agree with the bailouts, and they will both sing in unison to "make the tax cuts permanent" to come out of this. :puke:

[Robbien]

158. Bailouts for banks who cater to hedge funds and the wealthy

No bailouts for Joe Sixpack who is being thrown to the curb during foreclosure proceedings.

Also no bailouts for the dollar. Inflation is not a problem Bush people worry about.

[Ghost Dog]

164. Bill would give those living in cars right to last few possessions

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=230x2388

So, hey, if that bill passes it's not all bad...

http://www.google.com/search?q=car+living

[Robbien]

176. Every time one goes into the poverty forum

one learns of even more outrage and hardship piled upon those living at the bottom of the pay scale.

Having all one's possessions towed away and junked?

Gaud how I hate this free market capitalist system of ours.

[UpInArms]

166. Bush warns against bad proposals on housing slump (and he would know good from bad how?)

http://www.reuters.com/article/bondsNews/idUSWAT00913620080314

NEW YORK (Reuters) - President George W. Bush on Friday said the root cause of the U.S. economic slowdown was a downturn in the housing market and said he strongly rejected some proposals to deal with the crisis.

He said a proposal for state and local governments to buy abandoned and foreclosed homes would only help lenders and instead of helping Americans stay in their homes.

He said allowing bankruptcy courts to change mortgage terms would send the strong signal to financial markets.

I say anything that falls from his lips or those of his minions would be the "bad ideas".

[wordpix]

212. totally agree with you, UpInArms, *'s "good" proposals only bail out his Wall St. backers who

schemed up these loans in the first place.

[Demeter]

172. Bear Stearns' bailout has echoes of 1907 panic

http://www.marketwatch.com/news/story/jp-morgans-role-bailout-harks/story.aspx?guid={62A41B26-D222-4582-9043-CFE3A44D7130}&siteid=yahoomy

BOSTON (MarketWatch) -- Over a century after John Pierpont Morgan singlehandedly staved off a potential run on U.S. banks -- by forcing rivals to come together to save their own -- his name is also linked to the latest bailout of a teetering financial institution.
Before there even was a Federal Reserve, financier J.P. Morgan during the panic of 1907 played a key role in preventing a potential disaster for financial markets.
Now, J.P. Morgan Chase & Co. is working with the Fed to help save Bear Stearns Cos by providing it with emergency financing. See full story AT LINK ABOVE.


http://news.yahoo.com/s/ap/20080314/ap_on_bi_ge/bear_stearns_8

NEW YORK - Bear Stearns Cos., one of Wall Street's venerable investment banks, received a bailout Friday by the federal government and JPMorgan Chase & Co. in a surprise, last-ditch effort to save the 86-year old institution.

The Federal Reserve responded swiftly to pleas from Bear Stearns that its coffers had "significantly deteriorated" within a 24-hour period. Central bankers backed an arrangement to bolster the company, and stood ready to provide extra resources to combat a credit crisis that now threatens one of America's biggest financial institutions.

Bear Stearns, the nation's fifth-largest investment bank, made its fortune dealing in opaque mortgage-backed securities — a strategy that might be its undoing amid the worst housing slump in a quarter century. The bank has racked up $2.75 billion in write-downs since last year, and faced a possible collapse without some kind of lifeline.

Bear Stearns lost half of its value within 30 minutes of the market open, before clawing back a bit to be down 41 percent, or $23.51, at $33.49 by midday. The news rattled investors, pushing the Dow Jones industrial average down about 150 points.

JPMorgan Chase, the nation's third-largest bank, agreed to pump more money into Bear Stearns to keep it in business, but did not divulge how much it was spending. Top executives from both companies were in talks, and were even considering the outright sale of Bear Stearns to JPMorgan, according to a person familiar with the talks who was not authorized to speak on the record.

Bear Stearns said in a statement that it is working with JPMorgan Chase to find permanent strategic alternatives to alleviate their cash problems.

JPMorgan Chase — which has been hurt far less by the mortgage morass than other investment banks — is providing secured funding to Bear Stearns for 28 days, backstopped by the Federal Reserve Bank of New York. Bear Stearns and the Fed approached JPMorgan Chase about the financing and a potential deal, according to the person familiar with the talks.

[UpInArms]

174. doesn't "BS" stand for bullsh*t? - well, here's the BS CEO spew

01. Bear able to do business as usual with new credit : CFO
12:56 PM ET, Mar 14, 2008 - 3 minutes ago

02. Bear saw no big withdrawls after bailout announcement
12:55 PM ET, Mar 14, 2008 - 4 minutes ago

03. Bear went to Morgan becuase it knew firm's holdings:CFO
12:54 PM ET, Mar 14, 2008 - 5 minutes ago

04. Morgan was able to quickly decide on helping Bear : Bear CFO
12:54 PM ET, Mar 14, 2008 - 5 minutes ago

05. Bear CFO:Firm has had no big mark to market hits since Feb
12:50 PM ET, Mar 14, 2008 - 9 minutes ago

06. Bear CEO says he believes book value in the $80s a share
12:49 PM ET, Mar 14, 2008 - 10 minutes ago

07. Bear had big cash outflows on Thursday from hedge funds:CFO
12:47 PM ET, Mar 14, 2008 - 12 minutes ago

08. Bear shares fall 41% as CEO begins conference call
12:46 PM ET, Mar 14, 2008 - 13 minutes ago

09. Bear will continue to explore alternatives with Lazard:CEO
12:45 PM ET, Mar 14, 2008 - 14 minutes ago

10. Bear comfortable with current range of Q1 estimates : CEO
12:44 PM ET, Mar 14, 2008 - 15 minutes ago

[UpInArms]

177. London traders told stop dealing with Bear: sources

http://www.reuters.com/article/bondsNews/idUSL1439947820080314?sp=true

LONDON (Reuters) - Financial market traders across London have been told by their firms to stop dealing with Bear Stearns, sources in several dealing rooms said on Friday.

At least six major institutions in London -- including Commerzbank, Royal Bank of Scotland and JPMorgan -- had stopped giving prices to the U.S. bank, a credit trader at one European institution in London, who declined to be identified, told Reuters.

Credit Suisse had also stopped trading with Bear Stearns, a London-based equities broker said.

None of the institutions named by the traders would comment on the subject when contacted by Reuters.

A London-based government bond trader said banks had been withdrawing from transactions with Bear Stearns since Thursday.

JPMorgan Chase & Co and the Federal Reserve Bank of New York on Friday agreed to provide emergency financing to Bear Stearns after the investment bank said its cash position had deteriorated sharply, sending its shares into freefall.

...more...

[Robbien]

178. No Brit is doing business with Bear???

What the heck are we doing bailing out a non-going concern. Bear really doesn't have any revenue producing stream left.

[Roland99]

181. Well, according to Stephen Colbert, a bear is America's #1 enemy!

:D

[Robbien]

214. Ha!

According to CNBC, speculators are the bear's worst enemy. They were talking about how there were millions of puts on bear coming into today's market, some as low as five bucks a put.

Then there is a new article out:

According to Bear Stearns CEO, Alan Schwartz, his company went from being a stable and liquid enterprise to nearly insolvent in the span of 24-hours. What unexpected event arrived to shipwreck poor Bear? Market chatter of course.

Obviously Mr. Schwartz is being disingenuous. After all, financially stable companies do not suddenly blow-up because a handful of investors are spreading erroneous rumors. Rather, by definition financially stable enterprises are those that are not slaves to their creditors and/or those that do not carry a market risk profile that can turn the company into road kill inside of 24-hours.

http://www.marketoracle.co.uk/Article4012.html

[Ghost Dog]

229. Well, faced with the obvious lack of market transparency,

not to mention such values as decency and honesty,

What do they expect?

[Demeter]

179. Ooooh! Shunning! Haven't Seen Much of That Lately!

Where's the popcorn?

[Ghost Dog]

191. Europe shares lose 1%; Bear sparks bank worries

LONDON, March 14 (Reuters) - European shares closed about 1 percent lower in a volatile session on Friday after news of emergency financing to Bear Stearns stoked fresh worries about the impact of the credit crisis on banks.

The FTSEurofirst 300 index closed unofficially down 0.95 percent at 1,256.37 points having yo-yoed in and out of positive territory.

JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) and the Federal Reserve Bank of New York on Friday agreed to provide emergency financing to Bear Stearns (BSC.N: Quote, Profile, Research) after the investment bank said its cash position had deteriorated sharply, sending its shares into freefall.

A 50-percent drop in stocks of the fifth-largest U.S. investment bank poured gloom over the financial sector on both sides of the Atlantic and banks were the biggest negative weight on the European index.

UBS (UBSN.VX: Quote, Profile, Research) -- which has been a major victim of the credit crisis among major European banks -- was down more than 7 percent. HSBC (HSBA.L: Quote, Profile, Research) fell 1.9 percent, HBOS (HBOS.L: Quote, Profile, Research) shed 6.1 percent, BNP Paribas (BNPP.PA: Quote, Profile, Research) lost 2.5 percent and Barclays (BARC.L: Quote, Profile, Research) dropped 3.9 percent.

/. http://uk.reuters.com/article/eurMktRpt/idUKL1442254320080314

^ATX ATX 3,718.17 12:35PM ET Down 20.57 (0.55%)
^BFX BEL-20 3,676.88 1:07PM ET Down 29.16 (0.79%)
^FCHI CAC 40 4,592.15 1:10PM ET Down 38.04 (0.82%)
^GDAXI DAX 6,451.90 12:45PM ET Down 48.66 (0.75%)
^AEX AEX General 432.30 1:07PM ET Down 2.25 (0.52%)
^OSEAX OSE All Share 473.01 11:19AM ET Up 0.35 (0.07%)
^MIBTEL MIBTel 24,223.00 12:40PM ET Down 222.00 (0.91%)
^IXX ISE National-100 85.66 1:26PM ET Down 2.19 (2.49%)
^SMSI Madrid General 1,409.04 12:38PM ET Down 5.56 (0.39%)
^OMXSPI Stockholm General 305.09 12:43PM ET Down 3.81 (1.23%)
^SSMI Swiss Market 7,132.03 12:31PM ET Down 119.70 (1.65%)
^FTSE FTSE 100 5,631.70 12:35PM ET Down 60.70 (1.07%)

[UpInArms]

168. 12:46 EST getting much redder again

Dow 11,933.83 211.91 (1.74%)
Nasdaq 2,213.45 50.16 (2.22%)
S&P 500 1,287.94 27.54 (2.09%)
10-Yr Bond 3.432% 0.102

NYSE Volume 2,571,890,750
Nasdaq Volume 1,218,940,750

12:30 pm : Stocks continue to trade lower. Bear Stearns (BSC 35.76, -21.24) will be holding a conference call at 12:30 ET.

Within the S&P 500, only 6% of stocks are trading higher. The leaders include Boeing (BA 75.87, +1.69) and Paccar (PCAR 45.98, +1.14). The main laggards are Exxon Mobil (XOM 85.93, -1.12) and General Electric (GE 33.59, -0.66).

By percentage change, Mylan (MYL 11.12, +0.43) and UST (UST 56.64, +1.39) are leading the way. Bear Stearns (BSC 35.76, -21.24) and Lehman Brothers (LEH 42.05, -3.94) have seen the largest percentage declines.DJ30 -171.70 NASDAQ -38.61 SP500 -22.18 NASDAQ Dec/Adv/Vol 2068/673/1.14 bln NYSE Dec/Adv/Vol 2512/532/813 mln

12:05 pm : The stock market is trading sharply lower after credit concerns outweighed a better than expected inflation reading. After this session's decline, the stock market has given up nearly all of this week's gains.

The stock market got clipped on news that Bear Stearns (BSC 33.85, -23.15) will receive financing as needed from JPMorgan Chase (JPM 37.45, -0.66) and the Federal Reserve Bank of New York. The emergency funding agreement gives Bear a secured loan facility for an initial period of up to 28 days.

Shares of Bear had been hammered earlier this week on rumors it was facing a liquidity crisis. Today, the firm blamed those rumors for causing a deterioration of its liquidity position in the last 24 hours.

[w8liftinglady]

170. yeah,and Bernanke hasn't spoken,yet

[UpInArms]

173. you'll hear him before you see him - thwonk thwonk thwonk

[Roland99]

180. 1:26pm - Threating the 11,900 PISL

Dow 11,905.17 -240.57
Nasdaq 2,209.20 -54.41
S&P 500 1,285.82 -29.66
Oil $110.20 $-0.13
10 YR 3.40% -0.14
Gold $998.50 $4.70

[ozymandius]

184. Blood and eyeballs spattering the floor.

1:31
Dow 11,913.96 Down 231.78 (1.91%)
Nasdaq 2,211.72 Down 51.89 (2.29%)
S&P 500 1,285.38 Down 30.10 (2.29%)
10-Yr Bond 3.4010% Down 0.1330
NYSE Volume 2,994,830,750
Nasdaq Volume 1,420,065,620

1:05 pm : The major indices are posting steep losses as they trade near their worst levels of the session. Fed Chairman Bernanke is set to speak on housing. In his prepared text he made no mention of monetary policy according to Reuters.

Bear Stearns (BSC 35.27, -21.73) said its company's book value is still fundamentally in the mid 80s. The company's shares are still trading sharply lower.DJ30 -216.06 NASDAQ -48.98 SP500 -27.30 NASDAQ Dec/Adv/Vol 2160/618/1.30 bln NYSE Dec/Adv/Vol 2587/483/914 mln

12:30 pm : Stocks continue to trade lower. Bear Stearns (BSC 35.76, -21.24) will be holding a conference call at 12:30 ET.

Within the S&P 500, only 6% of stocks are trading higher. The leaders include Boeing (BA 75.87, +1.69) and Paccar (PCAR 45.98, +1.14). The main laggards are Exxon Mobil (XOM 85.93, -1.12) and General Electric (GE 33.59, -0.66).

By percentage change, Mylan (MYL 11.12, +0.43) and UST (UST 56.64, +1.39) are leading the way. Bear Stearns (BSC 35.76, -21.24) and Lehman Brothers (LEH 42.05, -3.94) have seen the largest percentage declines.DJ30 -171.70 NASDAQ -38.61 SP500 -22.18 NASDAQ Dec/Adv/Vol 2068/673/1.14 bln NYSE Dec/Adv/Vol 2512/532/813 mln

[Robbien]

186. Trading volume is also huge today

Citigroup is down over seven percent and has had over a hundred million trades so far.

Crazy headless chickens are running around the trader floors today.

[Lasher]

189. Sucker rally

We're right back where we started on Monday and resuming the decline.

[Roland99]

200. 2:29pm - One PISL gone and another one in sight...

Dow 11,856.41 -289.33
Nasdaq 2,195.42 -68.19
S&P 500 1,276.13 -39.35
Oil $110.25 $-0.08
10 YR 3.40% -0.14
Gold $1,000.00 $6.20

[Hugin]

202. I'm watching that there yellow metal PISL...

:wow:

[AnneD]

223. My daughter took

some of her savings and bought an ounce of gold several months ago-her first investment (with Mom and DU-SWT information). I needn't tell you she is on cloud nine. She just made some extra book and tuition money. I called her to tell her but she already quoted me the number:rofl: Thanks guys.

Nothing like having some money on the table to perk your interest. She had fun doing the deal she learned quite a bit.

[hatrack]

201. S&P Downgrades Bear Stearns To "Sell", Cuts Debt Rating From A to BBB

March 14, 2008 12:44 PM EDT

S&P Equity Research downgrades Bear Stearns (NYSE: BSC) from Hold to Sell.

S&P analyst, M. Albrecht, says, "BSC announces that it has received a 28-day secured loan facility from JP Morgan Chase (NYSE: JPM) to access liquidity as needed, with the backing of the NY Federal Reserve, and is in discussions to secure longer term financing. It said liquidity concerns arose in the last 24 hours. We see this as a move by the Fed to prop up the firm in a time of crisis, but think the long-term viability of the firm as a standalone entity may be challenged. We are cutting our target price by $45 to $30 to reflect these challenges, as well as the probable deterioration of BSC balance sheet."

EDIT

http://www.streetinsider.com/Downgrades/S&P+Equity+Research+Downgrades+Bear+Stearns+(BSC)+to+Sell/3459964.html

Update - they also cut their credit ratings:

NEW YORK — Standard & Poor's cut some of its credit ratings on investment bank Bear Stearns Friday following news of the bank's cash crisis and emergency bailout.

S&P cut its long-term counterparty rating on Bear Stearns to "BBB" from "A" and its short-term rating to "A-3" from "A-1."

S&P said Bear Stearns' need for temporary financing to continue operating normally led to the downgrade. Earlier Friday, Bear Stearns said it is receiving a financing line from JPMorgan Chase that is secured by the Federal Reserve Bank of New York.

The agency also placed the bank's long- and short-term ratings on negative watch, meaning they could be downgraded in the next three months.

EDIT

http://www.chron.com/disp/story.mpl/ap/fn/5620197.html

[Hugin]

203. Back so soon from the S&P?

I thought they'd just announced everything was... I think the word was, "peachy"... or was it, "keen".

[hatrack]

207. Yeah, speedy response, considering exactly six of 80 ABX mortgage bonds can meet S&P AAA benchmarks

Of course, they're all still AAA . . .

:wtf:

[Ghost Dog]

211. Heads will roll at S$P. n/t

[wordpix]

215. peachy for the head of Bear Stearns---didn't I read today in NYT that he's got a new condo at the

Plaza for umpteen million$? :shrug:

Maybe I'm mixing up one of the corporate greedmongers with another, tho. :puke:

[Robbien]

205. Investors pulled billions from a BoA money market fund

Investors yanked billions of dollars out of Columbia Management's Prime Reserves money market fund last year, a stampede that continued this year and prompted the Boston-based asset manager to reorganize the fund to protect remaining investors.

The fate of Prime Reserves -- a merger with a larger money market fund -- underscores how a global credit crunch triggered a run on a money market fund whose investments included debt backed by risky subprime mortgages.

Money-market fund worries forced Bank of America Corp. to take the unusual step of making capital injections to prop up cash funds managed by its Columbia Management unit. The bank initially earmarked nearly $190 million in capital support for a group of four Columbia-managed funds that included Prime Reserves, regulatory filings show.

Columbia Prime Reserves' net assets were $8.1 billion at the end of May, but dwindled -- mostly due to client redemptions -- to about $2.9 billion this month, according to regulatory filings and Bank of America. On March 6, Columbia approved a proposal to merge Prime Reserves with the $59 billion Columbia Cash Reserves fund, the asset manager disclosed in regulatory filings.

http://www.bizjournals.com/boston/stories/2008/03/17/story4.html

Pulling out over five billion, more than sixty percent of deposits!

Ummm, isn't that what one would call a run on the bank?

[hatrack]

213. Swiss Franc Hits Parity With US Dollar - Bloomberg

March 14 (Bloomberg) -- The Swiss franc rose to parity against the dollar for the first time after Bear Stearns Cos. was forced to seek emergency funding, fueling concern the U.S. is sliding into a recession and prompting investors to sell higher-yielding assets funded in Switzerland.

The franc has gained versus all 16 most-active currencies this year as the U.S. subprime-mortgage crisis led investors to exit so-called carry trades amid a slump in stocks. The currency has also benefited from speculation the Swiss National Bank will cut borrowing costs this year less than the Federal Reserve as the economy escapes the worst of the global squeeze on credit.

The franc ``enjoys the best of both worlds: the funding- currency status and a higher yield,'' said Peter Frank, a currency strategist in London at Societe Generale SA, which correctly forecast the franc would reach parity this quarter. ``It's got the safe haven bid in times of financial distress. I see a fairly significant appreciation coming.''

Against the dollar, the franc climbed as high as 0.9988 and was at 1.0038 by 3:25 p.m. in Zurich, from 1.0093 yesterday. The franc may gain to 0.96 in coming months, Frank said. It also traded at 1.5693 per euro, from 1.5787 yesterday.

EDIT

http://www.bloomberg.com/apps/news?pid=20601085&sid=aeOYYi8PVJG8&refer=europe

[Ghost Dog]

218. Pump Alert!

Um... ...No, sorry,
Nah...

[MsLeopard]

222. OMG! That is too funny!

:rofl:

Funny and apparently true!

[Ghost Dog]

225. Thanx, MsLeopard.

:evilgrin:

Edit: Hey, I didn't mean to freeze the thread at this point...

[Ghost Dog]

230. Weak Dollar Costs U.S. Economy Its World No. 1 Spot

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3226827#3227164

[better tomorrow]

231. Bush going to Jacksonville, FL on Tuesday to address the

ECONOMY......

[UpInArms]

233. well, if it's lips are moving, you will know that it's lying

:hi:

[UpInArms]

232. end of the week numbers and blather

Dow 11,951.09 194.65 (1.60%)
Nasdaq 2,212.49 51.12 (2.26%)
S&P 500 1,288.14 27.34 (2.08%)
10-Yr Bond 3.421% 0.113

NYSE Volume 5,344,189,500
Nasdaq Volume 2,574,493,500

Markets opened flat and appeared set for a positive start Friday after better than expected inflationary data was announced. The tone quickly turned negative when participants digested news from Bear Stearns (BSC 30.00, -27.00) that the company's liquidity had deteriorated severely and rapidly. The announcement trumped other news items of the day and induced strong selling interest. The S&P 500 and Nasdaq each finished 2% lower.

Bear Stearns announced this morning it reached an agreement with JP Morgan Chase (JPM 36.54, -1.57), in conjunction with the Federal Reserve Bank of New York, to receive a secured loan facility for an initial period of up to 28 days. The agreement allows Bear Stearns to access liquidity as needed and came as a result of Bear's rapid liquidity deterioration in the last 24 hours. Notably, Bear Stearns stated it is talking with JPMorgan Chase regarding permanent financing or other alternatives. That statement has led to considerable speculation regarding the future of Bear Stearns. Bear Stearns will now report its latest quarterly earnings results on Monday; its shares are trading at their lowest level in about 10 years.

Selling pressure intensified in the afternoon, but the stock market made a late attempt to pare losses in the final hour of trading. The recovery effort faded, though, with all ten economic sectors finishing down substantially. Only the utilities sector (-0.9%) saw a loss of less than 1%. Financials were the session's worst offender, ending more than 4.0% lower.

Of the Dow's 30 components, only Boeing (BA 76.23, +2.05) ended the day with a gain. The company's shares were upgraded from Equal Weight to Overweight at Morgan Stanley.

February CPI and core CPI were both flat. The data were better than expected as economists called for CPI to increase 0.3% and core CPI to increase 0.2%. Year-over-year CPI is up 4.0%, while core CPI is up 2.3% year-over-year.

The day's bearish trading helped lift gold to an all-time non inflation adjusted high of $1,007.30 per ounce. Treasurys also benefited as the benchmark 10-year note finished up 23 ticks, pushing its yield lower to 3.44%.

Crude closed on the Nymex down $0.22 at $110.11 per barrel after failing to break yesterday's all-time intraday high of $111.00 per barrel.

Next week offers plenty for traders and investors. Market participants anxiously await the latest announcement from Bear Stearns on Monday. Tuesday the Fed announces its monetary policy decision. Fed funds futures are currently pricing a 64% probability the fed cuts the fed funds rate 100 basis points to 2.00%.DJ30 -194.65 NASDAQ -51.12 NQ100 -2.09% R2K -2.47% SP400 -1.86% SP500 -27.34 NASDAQ Dec/Adv/Vol 2266/626/2.51 bln NYSE Dec/Adv/Vol 2637/509/1.86 bln