STOCK MARKET WATCH, Friday April 11, 2008

[ozymandius]

Source: du

STOCK MARKET WATCH, Friday April 11, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 285
DAYS SINCE DEMOCRACY DIED (12/12/00) 2637 DAYS
WHERE'S OSAMA BIN-LADEN? 2362 DAYS
DAYS SINCE ENRON COLLAPSE = 2653
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 April 10, 2008

Dow... 12,581.98    +54.72    (+0.44%)
Nasdaq... 2,351.70    +29.58    (+1.27%)
S&P 500... 1,360.55    +6.06    (+0.45%)
Gold future... 931.80    -5.70    (-0.61%)
30-Year Bond 4.34%    +0.04    (+0.84%)
10-Yr Bond... 3.53%    +0.07    (+1.90%)







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. I wish to offer my thanks to those who helped with my computer woes.

I found a huge amount of duplicate files that resulted from a meltdown some years ago. Something that totally escaped my memory until I installed the new OS that just happens to be a memory hog. Plus - the firewall was painfully out-of-date for the XP operating system. Elements of that program are incompatible with XP (time to upgrade). My newly purchased hard drive is corrupted. So the system still relies on the 9 year-old drive that came with the original Dell system. I am truly in awe of this device's robust health and adaptability - but, alas, I know its days are numbered.

Thanks again!

:hi:

[ozymandius]

2. Market WrapUp: The British Ounce Toppled by Housing Woes

BY GARY DORSCH

Economic events in the United States often provide a taste of what’s around the corner for the British economy. Both countries run large external trade deficits, and much like the US, the British economy has been expanding on little else than the availability of easy credit and asset price inflation in the housing market. The ties between the US and UK run even deeper. About half of the profits for FTSE companies come from overseas, and 15% from US-based affiliates.

Imaginative lending practices fueled a doubling of British home prices over the past six-years, the key engine of growth for the world’s fifth largest economy. But British borrowers now face a perilous situation where their home values are tumbling, and the local banking oligarchs are lifting their lending rates in order to recoup big losses of up to 20 billion pounds in toxic sub-prime mortgages.

.....

British bankers are in a fright after the International Monetary Fund said on April 5th that home prices in the UK and Ireland are vulnerable to a sharp 30% correction. “Home prices that look particularly vulnerable to a further correction are in Ireland, the United Kingdom, the Netherlands, and France. In these economies, it is difficult to account for the magnitude of the run-up in house prices.”

In the UK, the average home price is around £178,000, and if the IMF is correct, a 30% slide would knock home values lower to around £124,000, leaving many homeowners vulnerable to negative equity. In the US, somewhere between 10 and 15 million homeowners might find their homes are worth less than the amount of their loans, with home prices roughly 11% lower from a year ago.

.....

When a central bank of an external deficit country lowers its interest rates, it opens its currency to speculative attack. The Euro zone accounts for about 60% of UK exports, so the BoE appears to be engineering a devaluation of the British ounce to boost UK multinational income earned in the Euro zone and the US. Interestingly enough, the BoE and the Federal Reserve are pursuing similar policies, devaluing their currencies to boost exports and multinational income in order to offset the deleterious impact on consumer spending at home from sliding home prices.

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

[ozymandius]

3. Today's Reports

8:30 AM Export Prices ex-ag. Mar -
Briefing Forecast NA
Market Expects NA
Prior 0.5%

8:30 AM Import Prices ex-oil Mar -
Briefing Forecast NA
Market Expects NA
Prior 0.6% -

10:00 AM Mich Sentiment-Prel. Apr -
Briefing Forecast 68.0
Market Expects 69.0
Prior 69.5

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

[ozymandius]

5. Consumer confidence falls to new low

WASHINGTON - Americans' confidence in the economy fell to a new low, dragged down by worries about mounting job losses, record-high home foreclosures and zooming energy prices.

According to the RBC Cash Index, confidence dropped to a mark of 29.5 in April, down from 33.1 in March. The new reading was the worst since the index began in 2002. It marked the fourth month in a row where confidence has fallen to an all-time low.

.....

Over the past year, consumer confidence has deteriorated significantly. Worsening problems in housing, harder-to-get credit, financial turmoil on Wall Street and lofty energy prices have put people in a much more gloomy mind-set. Last April, confidence stood at 85.4. The index is based on results from the international polling firm Ipsos.

All the economy's problems are taking a toll on President Bush's approval ratings, too. The public's approval rating on his economic stewardship fell to a low of 27 percent, according to a separate Associated Press-Ipsos poll. Bush's overall job-approval rating dipped to 28 percent, also an all-time low, the poll said.

http://news.yahoo.com/s/ap/20080411/ap_on_bi_ge/consumer_confidence

[UpInArms]

20. U.S. March import prices rise 2.8% vs. 2.2% expected - March petroleum import prices rise 9.1%

01. U.S. March import prices ex-fuels rise 0.9%
8:30 AM ET, Apr 11, 2008

02. U.S. March import prices ex-petroleum rise 1.1%
8:30 AM ET, Apr 11, 2008

03. Petroleum import prices rise most since Nov. 2007
8:30 AM ET, Apr 11, 2008

04. U.S. March petroleum import prices rise 9.1%
8:30 AM ET, Apr 11, 2008

05. Import prices rise most since November 2007
8:30 AM ET, Apr 11, 2008

06. U.S. March import prices rise 2.8% vs. 2.2% expected
8:30 AM ET, Apr 11, 2008

[Pale Blue Dot]

32. That doesn't seem like good news.

:scared:

[UpInArms]

61. Consumer sentiment plunges to 26-year-low

http://www.marketwatch.com/news/story/consumer-sentiment-plunges-26-year-low/story.aspx?guid=%7B02F91163%2D168E%2D477E%2D8557%2DB642B3EF90C3%7D&dist=msr_1

WASHINGTON (MarketWatch) -- Consumer confidence sunk to its lowest level in 26 years in early April, according to a report on Friday from University of Michigan/Reuters, as worries about the economy, unemployment and inflation deflated hopes for future.

U.S. consumer sentiment index fell to 63.2 in early April from 69.5 in March. Sentiment is at its lowest level since March 1982. Economists surveyed by MarketWatch were looking for an April result of 68.8.

The expectations index fell to 53.4 in April -- the lowest since November 1990 -- from 60.1 in March, noted Ian Shepherdson, chief U.S. economist at High Frequency Economics. There's no sign that confidence bottomed out yet, he said.

"If sustained at this level, the index is consistent with a 0.5% year-over-year rate of outright decline in real consumption," Shepherdson wrote. "Bearing in mind that more than half of all consumption is non-discretionary (food, energy, housing, etc) this means discretionary spending will fall at a 1% rate or more, something we haven't seen since 1991."

Consumers have been more cautious about spending, according to recent confidence readings. Last month, after reporting a drop in consumer sentiment, Richard Curtin, the director of the survey, said a recession has occurred whenever the index has declined as much as it has fallen during the past year.

...more...

[ozymandius]

4. Oil rise to near mid-$110 a barrel

SINGAPORE - Oil prices rose to near mid-$110 a barrel Friday after slipping from a record hit in the middle of the week as a stronger U.S. dollar prompted investors to book profits.

An unexpected decline in U.S. crude and gasoline inventories drove oil prices to a trading record of $112.21 a barrel Wednesday amid concerns about inadequate supplies ahead of the Northern Hemisphere summer driving season.

But oil slipped back the next day after data from tanker tracking firm Oil Movements showed that shipments from members of the Organization of Petroleum Exporting Countries rose last week. Oil Movements' report suggests more supplies might soon come to market.

Prices were also weighed down by the U.S. dollar's recovery from an earlier low against the euro and its rise against the pound.

.....

More negative U.S. economic data also appeared to have taken steam out of oil's precipitous price rise. The Commerce Department reported the first decline in oil imports in a year — a possible sign that high prices and an economic downturn were hurting crude sales.

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

[TalkingDog]

6. Cartoon.

the "Bear/Bulls" in the lower right are clever. Well, okay. Maybe THEY aren't clever, but the visual shorthand is very nice.

I wonder why consumer confidence is a giraffe tho'?

[DemReadingDU]

18. the legs look wobbly

:shrug:

[ozymandius]

25. Being so tall - consumer confidence is the first to get wet. (nt)

[AnneD]

27. Perhaps...

the consumers are overstretched or overextended reaching for that green leaf.

Edited to add I like the charging 'credit' rhino.

[Hugin]

28. Pandas as 'Foreign Trade'...

:lol:

[Robbien]

37. Consumers have their heads in the clouds

Everyone on Wall Street and the DC Beltway has been feasting off the consumer for several years now but consumer confidence has been positive throughout it all. Even now the lower consumer confidence levels are much higher than they should be.

[Hugin]

41. Haha! I think you've got it!

Yeah, and we see their heads stooped in the background.

[ozymandius]

7. Frontier files for bankruptcy protection

DENVER - Frontier Airlines Holdings Inc. has filed for Chapter 11 bankruptcy protection, but unlike other airlines filing for bankruptcy in recent weeks, it plans to keep running while it reorganizes.

The low-fare carrier said its filing Friday came after an unexpected attempt by its principal credit card processor to start withholding significant proceeds from the sale of Frontier tickets, which threatened to hurt Frontier's liquidity.

......

Frontier, whose major hub is in Denver, has been affected as other airlines have by rising fuel costs and the credit crisis in financial markets.

ATA Airlines, Skybus and Aloha Airgroup all have filed for bankruptcy recently, but Menke said Frontier's reasons for doing so were different.

"Unfortunately, our principal credit card processor very recently and unexpectedly informed us that, beginning on April 11, it intended to start withholding significant proceeds received from the sale of Frontier tickets," he said. "This change in established practices would have represented a material change to our cash forecasts and business plan. Unchecked, it would have put severe restraints on Frontier's liquidity and would have made it impossible for us to continue normal operations."

http://news.yahoo.com/s/ap/20080411/ap_on_bi_ge/frontier_airlines_bankruptcy

[Demeter]

21. Am I Reading Between the Lines Correctly?

Are they implying that Wells Fargo is the credit card processor, and decided to take extra money out of the cash stream by withholding funds from credit card sales and justifying this by being a creditor?

That's pretty close to evil. Good way to lose the credit card business, too.

The vultures are going to be eating each other next.

[Hugin]

34. There was a time (not so long ago)...

When every business (even the Ma'nPa) handled their own credit accounts... It was one of the first
common accounting functions 'outsourced to save money'. I find it revealing that it is one of the
first levers being pulled. Almost like extortion.

Very interesting...

Glad I don't have much to do with Wells Fargo, anymore. (Although, I left due to the fact Rove had his
'Legal Defense Fund' there.)

[Demeter]

40. Good Morning Prag!

Outsourcing--it's going to be the next taboo. People will have to take their own trash out, scrub their own floors, fight their own wars, etc. It's going to get very Real very fast. Too many Princes of Blood are going to find themselves penniless and failing to stay alive....

I have a neighbor, retired now, immigrant from a wealthy Indian family. She told me how all she did in India was study, since there were so many destitute that hiring servants was not a luxury, but a "duty".

While I, as 4th generation descendent of Pollacks off the farms, pride myself on knowing how to do most tasks of daily life, including the traditionally "male" ones....going back to growing, canning and cooking food, sewing, repairing mechanical and electrical devices, etc, etc....all skills of no value at the moment, but perhaps coming back in alarming haste in the very near future.

Proof that it doesn't take all kinds.

[Shipwack]

47. My ladyfriend used to clean houses down here in FL...

Most of them were well-to-do, with beach houses and vacation homes in upper class neighborhoods.

Last year she started losing customers, including ones that had used her services for years.

They all said the same thing; they loved her work, but they couldn't afford the luxury of having her come over anymore.

[Dr.Phool]

57. Can they really do that?

I know the fees they charge are outrageous. But, can they really withhold your cash flow? I'd find another processor immediately.

[Robbien]

71. When have you ever heard about a credit card processor

being stopped from doing whatever it is they want to do?

Yes, they can say that market conditions require a larger holdback to pay for higher defaults/fraud on credit cards. Usually holdbacks are anywhere from one to five percent of total credit card purchases which the processor holds for six months.

[ozymandius]

8. Futures fall after GE reports drop in profit

NEW YORK (Reuters) - Stock index futures turned lower on Friday after industrial conglomerate General Electric Co (NYSE:GE - News) reported an unexpected 6 percent drop in quarterly profit and lowered its earnings forecast for the year.

http://biz.yahoo.com/rb/080411/markets_stocks.html?.v=2

-very brief-

[UpInArms]

13. GE reports 6% unexpected profit drop, shares tumble

http://news.yahoo.com/s/nm/20080411/bs_nm/ge_dc

BOSTON (Reuters) - General Electric Co (GE.N) reported on Friday an unexpected 6 percent drop in profit, as the slumping U.S. economy and credit crunch drove down profits at its financial, industrial and healthcare units.

Shares of the second-largest U.S. company by market capitalization fell 5.4 percent on the news, dragging down the broader U.S. markets. Due to the size and variety of its operations, GE is regarded as a bellwether of the U.S. economy.

"It's confirmation that we're in a recession," said Jerome Heppelmann, portfolio manager at Liberty Ridge Capital in Berwyn, Pennsylvania.

The company also lowered its earnings forecast for the year, reflecting a slower economy and challenging capital markets.

"These results confirm that the slowdown is widespread and beginning to impact capex (capital expenditures) and longer-cycle businesses," said Stephen Surpless, senior analyst at Cantor Fitzgerald in London.

...more...

[UpInArms]

17. GLOBAL MARKETS-General Electric results hits stocks and dollar

http://www.reuters.com/article/bondsNews/idUSL1173966020080411

LONDON, April 11 (Reuters) - Worse-than-expected results from U.S. conglomerate General Electric (GE.N: Quote, Profile, Research) dragged European stocks into negative territory on Friday, weakened the dollar and lifted demand for bonds.

GE said its net earnings per share for the first quarter was $0.43, about 15 percent below a Reuters forecast of $0.51 percent. The earnings report, one of the earliest for the first quarter, was seen as a guide to the state of the U.S. economy at the beginning of this year.

...more...

[Hugin]

36. "unexpected"

Just like deer in headlights, aren't they? :eyes:

[Demeter]

42. More Like Thieves in the Night

Who didn't make it out the door before the householder woke up, flicked on the lights, and shouted "What the hell?"

[TalkingDog]

9. The thigh bone's connected to th' knee bone. The kneebone's

connected to the...oh heck, to the rest of it. We got the idea already.

GE Profit falls 11%:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aTQnjMnhgCjs&refer=home


U.S. Stock Futures Decline After General Electric Cuts Forecast:

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

[Hugin]

38. Did you hear...

It's all so UNEXPECTED. :o

:eyes:

[ozymandius]

10. Bear Stearns delays filing 1Q results

In a filing with the Securities and Exchange Commission, the investment bank said it expects to file its Form 10-Q by the extended deadline of April 14.

Bear Stearns said it cannot provide a reasonable estimate of its results for the three months ended Feb. 29, but expects earnings to be 'significantly lower' compared with the prior-year period.

http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-24419668.htm

[ozymandius]

11. Investment Bank Demand for Fed Liquidity Falls

The Financial Times reports a rare bit of encouraging news on the credit crisis front, namely, that investment banks have been making less use of the Fed's liquidity facilities of late:

Direct borrowing from its new primary dealer credit facility fell $8bn from $34bn (£17bn) to $26bn in the week to April 9, the Fed said. Meanwhile, the central bank also said that its latest swap auction of Treasury securities was undersubscribed.

But should we then conclude that investment banks are in improved health? After all, Goldman CEO Lloyd Blankfein asserted that the industry is more than half way through the debt contraction.

This optimistic assessment seems at odds with facts on the ground. Yes, we in a period of relative calm, but each time this has happened of late, a new eruption of problems has led to panic, worries of systemic collapse, and new moves by the Fed, And even more worrisome, each time the intensity of the outbreak has increased.

.....

Moreover, there are plenty of shoes yet to drop. Interbank cash hoarding is on the rise despite the Fed's heroic efforts; a bottom of the housing market is nowhere in sight (and we won't know how low it will go in the mortgage market until we know the end game for residential real estate); commercial real estate losses have only started. But scariest by far is the credit default swaps market.

http://www.nakedcapitalism.com/2008/04/investment-bank-demand-for-fed.html

[UpInArms]

12. dollar watch

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

Last trade 71.754 Change -0.394 (-0.55%)

Why G7 Meetings Matter

http://www.dailyfx.com/story/topheadline/Why_G7_Meetings_Matter_1207847697818.html

There is no time better than the present to recognize the dollar’s weakness. With the April 11 G7 meeting of Finance Ministers and Central Bankers just days away, government officials around the world have the power to stop the dollar from falling. But will they? Over the past 30 years, G7 meetings have marked big turning points for the US dollar.

According to the following G7 chart, significant tops and bottoms have coincided with a major change in the foreign exchange language of the G7 communiqué. For example, following the Dubai meeting in 2003, the Group of Seven called for more “flexibility in exchange rates.” Although this criticism was directed at China and Japan, it came on the heels of a strong dollar rally. The decline of the US dollar during the late 1980s was also halted when the Louvre Accord was signed in 1987 at the G7 Minister of Finance meeting. Even though the language in the communiqué is only changed every few years, G7 meetings matter because they have the potential to make or break the US dollar.



...more...

Is the Dollar's Recovery Here to Stay?

http://www.dailyfx.com/story/bio1/Is_the_Dollars_Recovery_Here_1207862873658.html

The US dollar hit a record low against the Euro this morning and came within striking distance of 100 against the Japanese Yen. However the new round of selling did not last long as the dollar quickly recovered its losses. US economic data was weak with the trade deficit increasing more than expected. Although the recent weakness of the US dollar led many people to believe that the trade deficit would narrow, we warned in yesterday’s Daily Fundamentals that the deficit could expand because of the deterioration in manufacturing ISM. Jobless claims improved but the Easter Calendar effect makes the number distorting, particularly since continuing claims remain at very high levels. Even US Treasury Secretary Paulson admitted that the economy has turned down sharply. Unfortunately there is no concrete explanation for the bounce in the US dollar other than the fact that stocks are higher, commodity prices are lower and currency traders do not seem to be satisfied with Trichet’s comments. Whether this rally will continue remains to be seen. Fundamentally, the US dollar should weaken further because retail sales, which are due on Monday, should contract for another month. However fundamentals do not seem to be the driving force behind the US dollar today as technicals and sentiment dominate. The triple top in the EUR/USD is looking particularly ugly and reminds us of the currency pair’s trading pattern between November and February, when it took the fourth test of 1.4968, the prior and 3 months before the currency pair managed to break 1.50. Therefore even though we still believe that the EUR/USD will break 1.60, a further correction before that happens would not be out of the ordinary. In fact, we expect import prices and the University of Michigan consumer confidence reports to be dollar positive because of the improvements in the weekly ABC consumer confidence reports and the sharp rise in commodity prices. As indicated by the leading story in today’s Wall Street Journal, inflation around the world is set to reach a decade high.

...more...

[UpInArms]

44. Credit crisis overshadows dollar at G7

http://www.marketwatch.com/news/story/credit-crisis-overshadow-dollar-g7/story.aspx?guid=%7B15FF57A9%2DA7A2%2D4909%2D8C10%2DEBE66100B021%7D

LONDON (MarketWatch) - Forget the falling dollar. Efforts to come up with an answer to a pernicious and surprisingly persistent credit crisis will be the top job when finance ministers and central bankers of the Group of Seven industrial nations gather in Washington Friday.

"The credit crisis is a much more salient issue for policy makers than the
U.S. dollar," said Marc Chandler, head of currency strategy at Brown Brothers Harriman.

"Many seem to believe if the former can be fixed the latter will stabilize."
That hardly means currencies will be off the table.

The dollar, after posting a modest rebound earlier this month, came under renewed pressure this week, falling to yet another new all-time low against the euro, with the shared currency rising as high as $1.5911 on Thursday. The dollar also saw renewed weakness against the Japanese yen.

The weak dollar has raised hackles in Europe and Japan, where officials say it has undermined their exporters.

But economists say market fundamentals probably aren't right for the G7 to attempt coordinated intervention in an effort to end the dollar's slide. After all, fears remain of a deepening U.S. downturn. The Federal Reserve is expected to further cut interest rates, while the European Central Bank has left rates on hold and isn't expected to follow through with cuts any time soon amid surging near-term inflation pressures.

...more...

[UpInArms]

14. Lehman makes move to turn unsold bad debt to cash through Fed Bailout: report

http://www.reuters.com/article/businessNews/idUSN1139492520080411?feedType=RSS&feedName=businessNews

Holdings Inc (LEH.N: Quote, Profile, Research) repackaged unsold debt and used the Federal Reserve's new borrowing facility to convert loans that investors mostly rejected into cash to finance its business, the Wall Street Journal reported.

According to the Journal, Lehman transferred $2.8 billion in loans that included some risky leveraged buyout debt into a new investment entity called Freedom.

Freedom then issued debt securities backed by the loans, and $2.26 billion of the securities got investment-grade credit rankings from Moody's and Standard & Poor's, according to the report.

The bank used some of those securities as collateral for a low-interest, short-term cash loan from the Federal Reserve, the Journal said, citing people familiar with the matter.

The move was meant as a test to see what the Federal Reserve would accept, and the size of the loan was not material, the Journal added, citing a person familiar with the matter.

...more...

[Robbien]

46. Uh oh. In their announcement the Feds said they wouldn't accept this junk

which is probably why there hasn't been many takers at the window.

If this Lehman slight of hand sticks, all the vultures will be rushing to follow suit.

"Lehman representatives and the Federal Reserve could not be reached immediately for comment." The safe bet is they won't be making themselves available any time soon.

[Dr.Phool]

62. Their garbage got AAA ratings again?

Does S&P or Moody's have any credibility left?

[TalkingDog]

15. There's that liberal, George Soros, mouthing off again.

Snip:
"I consider this the biggest financial crisis of my lifetime," Soros said during an interview Monday in his office overlooking Central Park. A "superbubble" that has been swelling for a quarter of a century is finally bursting, he said.

snip:
Soros has been worrying about the fragile state of the markets for years. But last summer, at a luncheon at his home in Southampton with 20 prominent financiers, he struck an unusually bearish note.

"The mood of the group was generally gloomy, but George said we were going into a serious recession," said Byron Wien, the chief investment strategist of Pequot Capital, a hedge fund.

Soros was one of only two people there who predicted the American economy was headed for a recession, he said.

Shortly after that luncheon Soros began meeting with hedge fund managers like John Paulson, who was early to predict a crisis in the housing market. He interrogated his portfolio managers and external hedge funds that manage his fund's money, and he took on new positions to hedge where they might have gone wrong. His last-minute strategies contributed to a 32 percent return — or roughly $4 billion for the year.

http://www.iht.com/articles/2008/04/11/business/11soros.php

[UpInArms]

16. Huh? Uber Cops on Wall Street?

http://news.yahoo.com/s/ap/20080411/ap_on_bi_ge/bernanke_credit_crisis

WASHINGTON - Federal Reserve Chairman Ben Bernanke said Thursday that regulators must move ahead on ways to prevent a future financial crisis from occurring even as they battle one that threatens to plunge the country into recession.

"We do not have the luxury of waiting for markets to stabilize before we think about the future," Bernanke said in a speech in Richmond.

Last month Bernanke, Treasury Secretary Henry Paulson and other top economic policymakers called for stricter regulation of mortgage lenders as part of a broad effort to prevent a repeat of the credit and financial problems that have damaged the economy.

The recommendations from the presidential advisory group on financial markets cover mortgage lenders and other institutions as well as investors, credit ratings agencies and regulators.

Federal and state regulators should strengthen oversight of mortgage lenders, the presidential group proposed last month. Also, states should follow strong, uniform licensing standards for mortgage brokers. Legislation in Congress would create a nationwide licensing system.

<snip>

Under the plan, the Fed — created in 1913 after a series of bank panics — would become an uber cop — overseeing the stability of the entire financial system including commercial banks, investment banks, insurance companies, hedge funds, private-equity firms and others. At the same time, the Fed would lose daily supervision of big banks.

...more...

Wow! UBER is German - so is this how they tell us the Nazis are coming?

[Demeter]

19. They Keep Talking Recession--As If This Were a Business Cycle Event

and not a fin de siècle cataclysm.

[TalkingDog]

23. Super Cop? Hyper Cop? Over Cop? Upper Cop?

What are we talking here?

I mean an Over Cop, especially a politically independent one, might have some merit.

The others seem like your standard NeoCons. And if appointments are made a la'(heckuva job)Brownie, then we might as well go home Myrtle. The party's over.

[ozymandius]

24. Super Duper Uber Goober?

"We do not have the luxury of waiting for markets to stabilize before we think about the future," Bernanke said in a speech in Richmond.

If wild fluctuations in the markets are what he calls "stable" - I shudder to think what the alternative could be.

[DemReadingDU]

22. Paul Krugman: The TED spread is up again.

4/10/08 Not over yet

Gurk. The TED spread is up again. So is the LIBOR-OIS spread. (One is the spread between Libor and Treasuries, the other the spread between Libor and the futures price of the Fed funds rate; I tend to prefer TED spread, because fears of bank defaults should affect Fed funds as well as Libor; but I know that Fed officials prefer OIS. Anyway, both pointing in the same direction.) And the flight to safety is back, with the interest rate on one-month Treasuries — which should be about the same as Fed funds — back down to 1%.

All of this involves fear of defaults by banks — despite what look from here (central New Jersey) like utterly clear signals from the Fed that bank debts will be socialized if necessary. I’m puzzled, and worried.
http://krugman.blogs.nytimes.com/2008/04/10/not-over-yet/


The TED Spread
http://www.bloomberg.com/apps/quote?ticker=.TEDSP%3AIND


3/20/08 The Liquidity Trap Cometh...
Think of the TED spread as an indicator of financial fever--with something like 0.3% per year being normal. Think of the short end of the yield curve as an indicator of how powerful the Federal Reserve's standard medicine of swapping Treasury securities for bank reserves is.
Be afraid. Be somewhat afraid.
http://delong.typepad.com/sdj/2008/03/the-liquidity-t.html


additional Ted Spread info
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3240102&mesg_id=3240203

[ozymandius]

26. futures and blather

08:30 am : S&P futures vs fair value: -14.4. Nasdaq futures vs fair value: -18.5. It is shaping up to be a sharply lower start to the trading day. March import prices rose 2.8% month over month, which is larger than the expected 2.0% increase. Year-over-year, imported prices are up 14.8%.

08:00 am : S&P futures vs fair value: -10.1. Nasdaq futures vs fair value: -10.5. Futures point to a negative start after erasing early gains. Bellwether General Electric (GE) provided a disappointing earnings report and outlook, citing weakness in financial services. GE said it earned $0.44 per share in the first quarter, which falls short of the consensus estimate of $0.51. Its revenue came in at $42.2 billion, which missed the consensus estimate of $43.7 billion. Looking ahead, GE expects its second quarter earnings per share will be $0.53 to $0.55 per share, which misses the expected earnings of $0.58. For full year 2008, GE expects to earn between $2.20 and $2.30 per share, versus the $2.43 consensus. European markets fell into the red after GE's report, with the FTSE shedding 0.9% and the Dax down 1.2%.

[DemReadingDU]

29. Update: While you were sleeping: A financial coup d'état

Yesterday's discussion link
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3262331&mesg_id=3262418


4/10/08
1st comment by Ilargi...
Ilargi: Yesterday, I said the Fed’s new deliberations mean nothing less than an unparalleled -money- power grab, in While you were sleeping: A financial coup d'état .

In a nutshell, the plan is that the Treasury will lend money to the Fed, instead of the other way around. In other words, the Fed will owe YOU money. Lots of it. And you can't ask for it back. This has never happened before, and it is certainly not the purpose of a central bank. But they will do it, because they can.

Two highly valued commentators, Mike Shedlock and Karl Denninger, addressed the same issues, and my personal impression is that both are slightly missing the point, or at least the whole point. First, Mish, who claims the Fed does what it does because it is in essence simply scared:


2nd comment by Ilargi...
Ilargi: And that is dead on, and it is precisely what I said: a power grab. A financial coup d'état. How Mish rhymes that with being terrified, I don’t know. I don’t have an ounce of doubt that this coup has been in the works for a long time. They’ve had this in mind all along, and that’s why they have conducted the policies they have in the recent past. No, it’s not the Fed that IS terrified, it’s you and me that SHOULD be terrified.

We are watching the most important development in the American “democratic” state since 1913, when the Fed was introduced, in exactly the same way that the citizens of Troy opened the gates to welcome the horse that would be their downfall. Today, the money masters might as well be taking over the White House by force. To put it in other words: this means unlimited taxation in America.

As for Karl Denninger, here’s a video he posted yesterday at Ticker Forum. Karl gives a good analysis, as usual, and is right in his assessment that the Fed should never not be borrowing from the taxpayer. He doesn’t yet seem to grasp the enormity of the situation, though.

read Mish's article & view Denninger video at this link...
http://theautomaticearth.blogspot.com/2008/04/debt-rattle-april-10-2008-citizens-of.html

[Demeter]

30. Credit Default Swaps: Derivative Disaster Du Jour By Ellen Brown

http://www.opednews.com/articles/genera_ellen_br_080410_credit_default_swaps.htm


When the smartest guys in the room designed their credit default swaps, they forgot to ask one thing – what if the parties on the other side of the bet don’t have the money to pay up? Credit default swaps (CDS) are insurance-like contracts that are sold as protection against default on loans, but CDS are not ordinary insurance. Insurance companies are regulated by the government, with reserve requirements, statutory limits, and examiners routinely showing up to check the books to make sure the money is there to cover potential claims. CDS are private bets, and the Federal Reserve from the time of Alan Greenspan has insisted that regulators keep hands off. The sacrosanct free market would supposedly regulate itself. The problem with that approach is that regulations are just rules. If there are no rules, the players can cheat; and cheat they have, with a gambler’s addiction. In December 2007, the Bank for International Settlements reported derivative trades tallying in at $681 trillion – ten times the gross domestic product of all the countries in the world combined. Somebody is obviously bluffing about the money being brought to the game, and that realization has made for some very jittery markets.

"Derivatives" are complex bank creations that are very hard to understand, but the basic idea is that you can insure an investment you want to go up by betting it will go down. The simplest form of derivative is a short sale: you can place a bet that some asset you own will go down, so that you are covered whichever way the asset moves. Credit default swaps are the most widely traded form of credit derivative. They are bets between two parties on whether or not a company will default on its bonds. In a typical default swap, the "protection buyer" gets a large payoff if the company defaults within a certain period of time, while the "protection seller" collects periodic payments for assuming the risk of default. CDS thus resemble insurance policies, but there is no requirement to actually hold any asset or suffer any loss, so CDS are widely used just to speculate on market changes. In one blogger’s example, a hedge fund wanting to increase its profits could sit back and collect $320,000 a year in premiums just for selling "protection" on a risky BBB junk bond. The premiums are "free" money – free until the bond actually goes into default, when the hedge fund could be on the hook for $100 million in claims. And there’s the catch: what if the hedge fund doesn’t have the $100 million? The fund’s corporate shell or limited partnership is put into bankruptcy, but that hardly helps the "protection buyers" who thought they were covered.

To the extent that CDS are being sold as "insurance," they are looking more like insurance fraud; and that fact has particularly hit home with the ratings downgrades of the "monoline" insurers and the recent collapse of Bear Stearns, a leading Wall Street investment brokerage. The monolines are so-called because they are allowed to insure only one industry, the bond industry. Monoline bond insurers are the biggest protection writers for CDS, and Bear Stearns was the twelfth largest counterparty to credit default swap trades in 2006.i These players have been major protection sellers in a massive web of credit default swaps, and when the "protection" goes, the whole fragile derivative pyramid will go with it. The collapse of the derivative monster thus appears to be both imminent and inevitable, but that fact need not be cause for despair. The $681 trillion derivatives trade is the last supersized bubble in a 300-year Ponzi scheme, one that has now taken over the entire monetary system. The nation’s wealth has been drained into private vaults, leaving scarcity in its wake. It is a corrupt system, and change is long overdue. Major crises are major opportunities for change.



The Wall Street Ponzi Scheme


The Ponzi scheme that has gone bad is not just another misguided investment strategy. It is at the very heart of the banking business, the thing that has propped it up over the course of three centuries. A Ponzi scheme is a form of pyramid scheme in which new investors must continually be sucked in at the bottom to support the investors at the top. In this case, new borrowers must continually be sucked in to support the creditors at the top. The Wall Street Ponzi scheme is built on "fractional reserve" lending, which allows banks to create "credit" (or "debt") with accounting entries. Banks are now allowed to lend from 10 to 30 times their "reserves," essentially counterfeiting the money they lend. Over 97 percent of the U.S. money supply (M3) has been created by banks in this way.ii The problem is that banks create only the principal and not the interest necessary to pay back their loans, so new borrowers must continually be found to take out new loans just to create enough "money" (or "credit") to service the old loans composing the money supply. The scramble to find new debtors has now gone on for over 300 years – ever since the founding of the Bank of England in 1694 – until the whole world has become mired in debt to the bankers’ private money monopoly. The Ponzi scheme has finally reached its mathematical limits: we are "all borrowed up."
When the banks ran out of creditworthy borrowers, they had to turn to uncreditworthy "subprime" borrowers; and to avoid losses from default, they moved these risky mortgages off their books by bundling them into "securities" and selling them to investors. To induce investors to buy, these securities were then "insured" with credit default swaps. But the housing bubble itself was another Ponzi scheme, and eventually there were no more borrowers to be sucked in at the bottom who could afford the ever-inflating home prices. When the subprime borrowers quit paying, the investors quit buying mortgage-backed securities. The banks were then left holding their own suspect paper; and without triple-A ratings, there is little chance that buyers for this "junk" will be found. The crisis is not, however, in the economy itself, which is fundamentally sound – or would be with a proper credit system to oil the wheels of production. The crisis is in the banking system, which can no longer cover up the shell game it has played for three centuries with other people’s money.



The Derivatives Chernobyl.....about Bear Stearns
A Parade of Bailout Schemes.....SEE LINK


Benjamin Franklin’s Solution



Nationalization has traditionally had a bad name in the United States, but it could be an attractive alternative for the American people and our representative government as well. Turning bankrupt Wall Street banks into public institutions might allow the government to get out of the debt cyclone by undoing what got us into it. Instead of robbing Peter to pay Paul, flapping around in a sea of debt trying to stay afloat by creating more debt, the government could address the problem at its source: it could restore the right to create money to Congress, the public body to which that solemn duty was delegated under the Constitution....The most brilliant banking model in our national history was established in the first half of the eighteenth century, in Benjamin Franklin’s home province of Pennsylvania. The local government created its own bank, which issued money and lent it to farmers at a modest interest. The provincial government created enough extra money to cover the interest not created in the original loans, spending it into the economy on public services. The bank was publicly owned, and the bankers it employed were public servants. The interest generated on its loans was sufficient to fund the government without taxes; and because the newly issued money came back to the government, the result was not inflationary.iii The Pennsylvania banking scheme was a sensible and highly workable system that was a product of American ingenuity but that never got a chance to prove itself after the colonies became a nation. It was an ironic twist, since according to Benjamin Franklin and others, restoring the power to create their own currency was a chief reason the colonists fought for independence. The bankers’ money-creating machine has had two centuries of empirical testing and has proven to be a failure. It is time the sovereign right to create money is taken from a private banking elite and restored to the American people to whom it properly belongs.






Authors Website: www.webofdebt.com, www.ellehbrown.com

Authors Bio:

Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and "the money trust." She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Her eleven books include the bestselling Nature's Pharmacy, co-authored with Dr. Lynne Walker, which has sold 285,000 copies. Her websites are www.webofdebt.com and www.ellenbrown.com.

Back

[DemReadingDU]

39. There's that word again: Ponzi

:crazy:

[Hugin]

49. So Ponzi wasn't a character on 'Happy Days'?!?!?

:o

http://en.wikipedia.org/wiki/Ponzi_scheme

"A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns ("profits") to investors out of the money paid in by subsequent investors, rather than from net revenues generated by any real business. It is named after Charles Ponzi."

http://en.wikipedia.org/wiki/Charles_Ponzi

(Mug shot on the Wiki... )

[Pale Blue Dot]

50. Actually, it IS. It's a cross between Fonzi and Potsie.

It's something that looks cool, but is actually really stupid.

[Hugin]

53. Talk about an 'unsustainable' business model... sheesh. n/t

[AnneD]

74. Like derivatives,

out sourcing, NAFTA, ARM's, hedge fund and Wall Street....I love that definition.:rofl:

[Tansy_Gold]

59. As I was saying. . . . .

Months ago, when I first started lurking here and then started writing here, my thoughts echoed Ellen Brown's as she's expressed them in the quoted article. Ponzi scheme, pyramid scheme, fraud, imaginary money, gambling, speculation, etc., were the terms I used because I didn't know what the hell these stupid "derivatives" were. Common sense told me this, nothing else.

I'm not by nature a gloomy person, but a fairly practical, pragmatic one. After my husband died almost three years ago, I was left in a pretty precarious financial position, which age and lack of currently marketable job skills have not improved. Caution, frugality, and inventiveness have kept me afloat, but just barely. And no, I do not have friends or family to turn to in an hour of need.

Yesterday I learned that one of my few remaining financial reserves, a small 401k account that was promoted in 1997 by my late husband's employer as "the safest thing we can find; you won't lose any money on this deal" after a previous retirement plan went sour, has suffered a slight decline in value over the past three months after ten years of steady but dependable growth. The representative I talked to at the company holding the account gave me a few options, one of which was to roll the account over into an IRA, another was to cash it out.

Cashing it out will result in 20% being withheld for federal income tax, which would normally come back as a refund on my 2008 return if my income level warrants; because of an unfortunate liability indirectly related to my husband's death, that refund will be retained by the government. Although I did not ask about the details of an IRA rollover, I suspect there will be a similar reduction in the funds' availability.

I offer this not as a plea for pity or sympathy, but as a profile of just one of the many, many, many people who have been victimized by the situation Ellen Brown described. Not someone who got suckered into a sub-prime mortgage by a lying-ass broker who filled out forms that showed a higher than real income. Not someone who bought a house at an inflated value and watched the mortgage rise higher than the value. Not someone who spent her way into credit card bankruptcy. Not someone who owns a gas-guzzling SUV for the prestige and ego boost. Just a working-class widow who saw "There but for the grace of God. . ." turn into "All those times we've seen tragedy and thought it only happens to other people, well, now we are the other people it happens to." And because the system had become so broken, there was no way out.

An acquaintance of mine and his wife, both retired on comfortable incomes, had booked a Caribbean cruise several months ago, with their departure date set for later this month. They had got a good price on it and planned an extended stay in Florida afterward to visit some family. Airline cancellations have forced them to scramble for replacement flights, and the remaining airlines have jacked prices sky high, if you'll pardon the pun. The only way to get a flight that would bring them to Florida in time for the cruise sailing, they had to extend their post-cruise stay by another day, and that meant rebooking their hotel -- except the hotel didn't have room availability to change the reservation, so they had to book into another and more expensive hotel. All told, the cancellation of a single airline flight has ended up costing the two of them an additional $4000. His comment: "This just ate up my stock dividends for NEXT year, and if the stock market doesn't go up considerably so I can liquidate a few things without losing capital, I'm going to have to cancel our trip to Hawaii in January."

Did I feel sorry for him? No, not at all. But as the pyramid collapses from the bottom up (ultimately it will collapse from top AND bottom simultaneously), I know that he and his wife will be far more comfortable far longer than the receptionist at the travel agency or the stewards on the cruise ship or the maids in the hotels or the data entry clerks at the credit card processing center -- all those service jobs that are all that's left of our economy. It's just anecdotal evidence of how systemic the rot really is.

Will all of us survive it? No, of course not. I'm hoping I'll be one of the survivors and my kids and grandkids and dogs and loved ones and friends. But I think there is some wisdom in watching for signs of imminent collapse, even small things, and making all the sensible preparations we can. Taking a 20% loss on the 401k may prove to be better than seeing it completely disappear.

I wouldn't recommend booking a cruise.


Tansy Gold

[Hugin]

60. Well said Tansy_Gold...

As always. :)

You have not only my sympathy and concern, but, my admiration as well.

[DemReadingDU]

75. no penalty to rollover 401k to IRA

I did this when I was forced out of my job. The trick is to roll it over, do not cash it out first. Whoever you decide to setup the IRA, they can handle everything for you.

P.S. I always look for your postings, you have some great insight. I'm sure you are going to be a survivor.


a song for you, and all of us
http://www.youtube.com/watch?v=ZBR2G-iI3-I

[Hugin]

78. An there we have it... Today's Music to Survive by: "I Will Survive" -- Gloria Gaynor

:thumbsup: :thumbsup: :thumbsup:

[kineneb]

76. death or illness can now ruin a family

I understand what you are going through. My husband died on Mar. 30, and because we were living on his SSDI, I now have no income.

Because he was ill for so long, there are no 401ks, savings or any fall-back funds; they were all cashed out 3 years ago to qualify for CMSP(rural CA low-income medical coverage) /Medicaid. I am fortunate that my family is helping out, but I don't want to depend on them. Because of age and lack of children, there are few resources available to me; I qualify for food stamps and CMSP only.

[Hugin]

79. ...

;(

I'm sorry to hear of your recent loss, kineneb.

What I said to Tansy goes equally to you.

[DemReadingDU]

81. I am so sorry

I remember you previously saying that you were taking care of your ill spouse. It is emotional time for you. Please keep checking in and keep us updated. Please accept my sympathy for you and your family.

[UpInArms]

95. ...

:grouphug:

I am so sorry :(

[AnneD]

99. Tansy and Kineneb.....

I think, in the vast scheme of thing, you will survive quit nicely, thank you. I deal with more than a few well to do and their progeny. Sadly, most are catered to and have no sense-common or otherwise. Their dads might know their way around the tax code, but they and their progeny are clueless as to survival skills.

It is a skill to grow plants, find water, make a shelter, start a fire, keep warm/cool, hunt, fish, prepare game. I would take my chances in a middle class-poor area because in that population-someone grew up on a farm, or worked as a labourer for a while and knows how to rig things.

You have managed to stretch out what little you have-and that is not just a skill, but an art form. Having been poor as a young child and staying on a farm for long periods of time helped me in college, and that helped me when I was unemployed. And I am sure those skills will serve me well again some time.

But some of the well to do-when they lose their money, they just never fully recover, esp if they are older (I have some immigrant friends that I base this on). It just shocks their system. But we have been without and survived.

[Demeter]

31. Beat The Clock! By Michael Fox

http://www.opednews.com/articles/genera_michael__080410_beat_the_clock_21.htm



There are seven months left until elections, and while the results in November can’t be considered a foregone conclusion, it’s clear to the die-hard disciples of Milton Friedman that things are going to change. But those gilded sultans of Wall St., have unfinished business that needs tending to, and the race is on. Their ultimate nefarious goal is to deregulate brokerages and banking by privatizing the government’s fiduciary duties through the Fed. They want financial anarchy, serving only their interests – and they only have seven months to push it through.


Who would want to do such things? Why, the same players who have brought the world economy to the frightening place at which we now find it, of course. It is beyond theoretical economics for these people, as I have written here before: it is their religion; the very core of their belief system, and, in spite of the myriad facts proving it so spectacularly false in its 26-year real-world application, they will not stop until their goal is fulfilled. Try telling a Creationist that Abraham didn’t have a pet dinosaur like Fred Flintstone, and he’ll look at you like you’re crazy. Try telling Atlas shrugger Alan Greenspan that our government is entitled to have oversight of the bankers, brokerages, and insurance industries servicing our money and it won’t even register.
Greenspan affirmed in the Financial Times that “the ideology I display…defines that set of ideas that we each believe explains how the world works and how we need to act to achieve our goals. Some of our views of causative forces are rational, some otherwise.” His clearly fall entirely under “otherwise.” He goes on to say that, “Even with full authority to intervene, it is not credible that regulators would have been able to prevent the subprime debacle.” I would disagree, and suggest that had the teeth not been extracted from regulators, the unprecedented proliferation of valueless securities would never have been allowed.

Greenspan’s illogical face-saving claim is that the Fed bears no responsibility whatsoever for the present international financial meltdown. You’ll find that he’s spending his gilded retirement lobbying - via posts in foreign press outlets - for further deregulation and greater empowerment of the Fed itself, and, as the Federal Reserve Board is comprised of executives from major banks and brokerages, the whole effort smacks of the purest form of Fascism. But that should come as no surprise.


Arguing against the movement to consolidate power at the Fed are three former heads of the Securities and Exchange Commission, who, for better or worse, at least are able to recognize its importance. I recommend reading their opinions, although Arthur Levitt, who ran the Commission throughout the Clinton Administration, does not go far enough in his opposition to the proposed deregulations, as he supports a proposed merger of the SEC and the Commodities Futures Trading Commission. But then, in 1999, Clinton signed the repeal of the 1935 Glass-Steagall Act, which placed a firewall between banking and brokerage to begin with.


But the toothless SEC doesn’t even have dentures! In spite of its mandate to have a bipartisan board - generally three from the party of the sitting president, and two from the opposition – the board presently has two vacant seats. You guessed it- it consists of only three Republicans. The two Democratic seats have been vacant since 2005.

And there are seven months left.




Authors Bio: Michael Fox is a writer based in Los Angeles.

[Hugin]

35. There have been some good pieces from the opednews...

I wasn't aware of that site. Thanks for sharing it, Demeter. :)

[Demeter]

43. One of My Confidential Sources

and ideally set up for cut and paste blogging...

[Demeter]

33. Healthcare; America's Second Greatest Problem: By Mike Folkerth

http://www.opednews.com/articles/opedne_mike_fol_080410_healthcare_3b_america_.htm



Good Morning Middle America, your King of Simple News is on the air.

U.S. NEWS: Healthcare remains the second greatest problem in America, just behind “growth is the answer.” As those of you who have read my book know, healthcare has been a thorn in my side for many years and at the current rates, I can’t afford to have that thorn removed. This particular thorn is not covered on my healthcare policy, due to the removal procedure that I recommend having the end results of my not needing a healthcare insurance policy.

I have chronicled the fact that a person in the U.S. on minimum wage cannot afford health insurance. That is, if they were willing to commit their entire pre-taxed gross income to that single cause! Say what?...That’s correct; if a minimum wage earner were willing to give up food, shelter and clothing they couldn’t pay for a decent family health plan. Of course, after a couple of weeks without food, they wouldn’t need health insurance. There is something terribly wrong with a country where a person can work a lifetime and one trip to the hospital can wipe out all that they have gained. A lifetime of earning, saving, investing…gone in a week.

Our ill conceived medical system combined with unchecked capitalism and a growth and consumption based economy have had one hell of a collision. How did that happen? Did it sneak up on us? Of course not, the math was always there and unrestrained greed has no limits other than those provided by nature. But, beware of the consequences; Mother Nature is one mean Mother. The problem is that in the mean time, our elected government officials have seen fit to put the current healthcare deficits on the cuff for our kids to pay. We now have funded and unfunded national debt in the U.S. reported as more than $100 Trillion, which greater than the wealth of our entire nation.

So what? Congress will take a trip to Barbados and think this thing over on the beach. There must be an easy way out and that ocean air seems to clear up their minds....If a problem such as healthcare leads to the deficits that I cited above, that problem needs to be resolved; now. We can no longer accept such rhetoric as, “We’ll form a commission and study it”…the study is done, the results are in, and the patient is dead. No business in America or anywhere else in this galaxy would allow a problem of this magnitude to go unchecked…but our elected officials did. I said elected, because we have elected them over and over and over. While the thinkers are in Barbados, the employers of the thinkers had better do some thinking of our own. Most American industry leaving the U.S. cites healthcare costs for their employee’s as the #1 reason. And it should be. Legacy healthcare costs at GM add some $1500 to every vehicle produced.

The time for action is now, not after the election, not wait until our next president is elected, that’s the old plan and nothing has been done except to sweep the problem under the rug. Insurance companies don’t belong in the healthcare business…period. A person’s life or a fear of losing ones lifetime earnings, should not be a profiteers dream. We all benefit from our healthcare and we all need to pay for it. I said healthcare, not insurance, not enormous CEO and board salaries, not stockholder profits, not gloated big-pharma profits, not elective cosmetic surgery, not huge litigation fees, not billions in malpractice insurance premiums…just plain old fashioned healthcare without the baggage. The entire system must be revamped and after all of these years, I believe the pain necessary to spur Middle America to action may have been reached. I’ve been patiently waiting.
It’s up to you Middle America, the wealthy can afford the system and the poor were voted out years ago.




Authors Website: www.kingofsimple.com

Authors Bio: Mike Folkerth is the author of "The Biggest Lie Ever Believed" and is not your run-of-the-mill author of finance and economics. The former real estate broker, developer, private real estate fund manager, auctioneer, Alaskan bush pilot, restaurateur, U.S. Navy veteran, heavy equipment operator, taxi cab driver, fishing guide, horse packer and few jobs too embarrassing to mention, writes from experience and plain common sense. Mike’s humorous systems of “Mikeronomics” and “Mikemathics” drastically simplify the economic and mathematic formulas commonly used by very smart, but terribly sheltered individuals.

Back

[kineneb]

83. the system sucks

and the public medical "safety net" is full of holes.

Contemplate this... in Cal., Medicaid is only available to the disabled, the poor over 65, and families with children under 18. If one is "fortunate" enough to live in certain rural counties, then medically indigent adults can obtain coverage from our County Medical Services Program (CMSP). But... the income maximums have not been changed since 1997! So, single people can have no more than $600/mo. gross income and $2000 in cash assets. Any income above that amount is subject to share-of-cost, in other words- one spends down to that $600.

With such a whacked up system, one either chooses to only earn around $600/mo. or goes without medical care. Either way, the person is screwed. And where, oh where, in all of this is an incentive to "get off the dole"? I read up on the rules and figured out there is no point in trying... unless I marry someone who has group medical coverage, this is my future.

As the article notes, a person earning minimum wage cannot afford to purchase medical coverage, so they must rely on the public system or go without (which is actually far more expensive). WalMart used to give out forms for food stamps and Medicaid to their new employees, knowing that WM did not pay enough to make ends meet. I call that corporate welfare.

[UpInArms]

45. 9:35 EST not a good weekend to hold stocks?

Dow 12,452.28 129.70 (1.03%)
Nasdaq 2,326.17 25.53 (1.09%)
S&P 500 1,344.96 15.59 (1.15%)
10-Yr Bond 3.488% 0.044

NYSE Volume 146,468,468.75
Nasdaq Volume 79,846,046.875

09:16 am : S&P futures vs fair value: -13.7. Nasdaq futures vs fair value: -24.8.

09:00 am : S&P futures vs fair value: -14.8. Nasdaq futures vs fair value: -27.0. A bearish bias persits in futures trade. Goldman Sachs cut its earnings estimate on Washington Mutual (WM) and recommended selling its shares short, according to Bloomberg.com. Goldman believes WaMu will post a loss of $3.30 per share this year, compared to its previous forecast of a $1.00 loss, according to the report. Just last week WaMu raised $7 billion in capital in an effort to shore up its balance sheet.

08:30 am : S&P futures vs fair value: -14.4. Nasdaq futures vs fair value: -18.5. It is shaping up to be a sharply lower start to the trading day. March import prices rose 2.8% month over month, which is larger than the expected 2.0% increase. Year-over-year, imported prices are up 14.8%.

[Demeter]

48. Another Record Year for Lobbying: $2.8 Billion

http://www.opensecrets.org/pressreleases/2008/Lobbying2007.4.10.asp?from_rss=yes
__________________

Expanding Washington’s influence industry by 8 percent in 2007, industries and interests spent $17 million for every day Congress was in session. The drug industry spent the most of all, paying lobbyists 25 percent more last year.

____________________

WASHINGTON—Corporations, industries, labor unions, governments and other interests spent a record $2.79 billion in 2007 to lobby for favorable policies in Washington, the nonpartisan Center for Responsive Politics has calculated. This represents an increase of 7.7 percent, or $200 million, over spending in 2006. And for every day Congress was in session, industries and interests spent an average of $17 million to lobby lawmakers and the federal government at large.

“At a time when our economy is contracting, Washington’s lobbying industry has been expanding,” said Sheila Krumholz, executive director of the 25-year-old watchdog group. “Lobbying seems to be a recession-proof industry. In some respects, interests seek even more from our government when the economy slows.”

CRP, which tracks lobbying spending on its award-winning Web site, OpenSecrets.org, found that, for the second straight year, health interests spent more on federal lobbying than any other economic sector—$444.7 million. The finance, insurance and real estate sector was second, spending about $418.7 million.

Looking more specifically within the larger sectors the Center tracks, the pharmaceuticals/health products industry outspent all industries by shelling out $227 million for lobbying services, or an average of $1.4 million for the 164 days that the 110th Congress met in 2007. The drug industry has spent $1.3 billion on federal lobbying over the last 10 years, more than any other industry. Its reported lobbying increased 25 percent in 2007.

The second-biggest spender among industries in 2007 was insurance, which spent $138 million on lobbying, followed by electric utilities, which spent $112.7 million, the computers/Internet industry, which spent $110.6 million, and hospitals and nursing homes, which paid lobbyists at least $90.5 million. The securities and investment industry, which ranked sixth, spent $87.3 million, increasing its lobbying 40 percent over 2006.

Drilling even further to look at particular corporations, trade associations, unions and other organizations, the biggest spender in 2007 was again the U.S. Chamber of Commerce. Although the business booster’s reported lobbying decreased about 27 percent last year, following a record year in 2006, the Chamber and its affiliates still managed to spend nearly $52.8 million on in-house lobbyists and with K Street firms.

General Electric was the number-two spender ($23.6 million), followed by three interests in the health sector: the Pharmaceutical Research and Manufacturers of America ($22.7 million), American Medical Association ($22.1 million) and the American Hospital Association ($19.7 million). Other big spenders on the Top 20 list included AARP, Exxon Mobil, AT&T, General Motors, the National Association of Realtors, Verizon Communications and several defense contractors, Northrop Grumman, Boeing and Lockheed Martin.

The amount of money spent on federal lobbying has increased about 8 percent annually since the late 1990s, making last year’s growth typical. But some interests vastly increased their lobbying in 2007. Blackstone Group, the private equity firm lobbying to prevent higher taxes on its profits, ramped up 477 percent to spend $5.4 million. The National Education Association, the nation’s largest teacher’s union, spent $9.2 million last year—up 464 percent—and presumably focused its lobbying on the reauthorization of the No Child Left Behind act.

Among Washington’s lobbying firms, Patton Boggs reported the highest revenue from registered lobbying for the fifth year in a row, $41.9 million, an increase over 2006 of more than 20 percent. The firm’s most lucrative clients included the private equity firm Cerberus Capital Management, the candy and pet food company Mars Inc., telecom giant Verizon, the pharmaceutical manufacturers Bristol-Myers Squibb and Roche, and the American Association for Justice (formerly the Association of Trial Lawyers of America).

The Center for Responsive Politics calculated spending on lobbying as narrowly defined under the Lobbying Disclosure Act of 1995, because that is what is disclosed to the Senate Office of Public Records (SOPR) and House Legislative Resource Center. Spending by corporations, industry groups, unions and other interests that is not strictly for lobbying of covered government officials, but is still meant to influence public policy, is not reported—and may exceed what was spent on direct lobbying. Such activities include public relations, advertising and grassroots lobbying.

Spending on lobbying was reported twice a year to Congress in 2007. The year-end reports were due Feb. 14 to SOPR, which was the data source for the Center’s analysis. The Center’s Lobbying Database on OpenSecrets.org now includes approximately 42,000 reports from 2007 that were available electronically from SOPR on April 7, in addition to data back to 1998. Despite SOPR’s new electronic filing system, it still took about eight weeks for complete year-end lobbying data to become electronically available to the public.

Beginning this year, lobbying reports will now be filed quarterly. April 21 is the deadline for reports covering lobbying in January through March of this year.

[Demeter]

51. Banks take blame for credit crisis By Krishna Guha and Chris Giles

http://www.ft.com/cms/s/0/0d7c533e-0664-11dd-802c-0000779fd2ac.html



The world’s leading banks on Wednesday publicly accepted much of the blame for the credit crisis, as the International Monetary Fund slashed its estimates for global growth and warned that the US downturn will last longer than most people expect...The IMF said the US would suffer a recession this year, recovery would not begin until next year, and growth would remain well below trend even in 2009.

Josef Ackermann, chief executive of Deutsche Bank and chairman of the Institute of International Finance, has promised a code of conduct for the industry, but said further regulation would be 'completely wrong'...The Institute of International Finance, meanwhile, representing more than 375 of the world’s largest financial companies, acknowledged “major points of weaknesses in business practices”, including bankers’ pay and the management of risk. But it said it would be “completely wrong” for the authorities to impose much greater regulation on the industry.

In its interim report on the causes and consequences of the credit crisis, the IIF promised a code of conduct for better self-regulation of the industry...The IIF report detailed a series of failings on the part of the banks, including managing risks; conflicts of interest over bankers’ pay; the over-reliance on models and inadequate protection against shortages of liquidity. It said that while pay should be left to individual banks, there should be greater deferral of bonuses and setting pay “on a risk-adjusted basis”, implying paying less to bankers who have simply taken big risks and struck lucky.

The IMF’s new forecasts, meanwhile, offered a bleak outlook for growth in both the US and Europe, challenging the relatively bullish views of national authorities and central banks...The IMF said the Fed “may well need to continue easing interest rates for some time” and put pressure on the ECB to start cutting rates too.

[Hugin]

55. "further regulation would be 'completely wrong'"

As opposed to what? The wrong committed by the banks in destroying the hard work and savings of the common
investors in the interest of greed?

Don't tempt me to begin weighing which 'wrongs' are worst.

[TalkingDog]

89. as in -

Which is a worse way to die by way of an angry mob: stoning, hanging or guillotine?

[UpInArms]

96. my opinion? very small stones

and many many many of them

:hi:

[Demeter]

52. Is an International Financial Conspiracy Driving World Events? By Richard C. Cook

http://www.opednews.com/articles/opedne_richard__080409_is_an_international_.htm



Is an International Financial Conspiracy Driving World Events? By Richard C. Cook

Global Research, March 27, 2008

"They make a desolation and call it peace." -Tacitus



Was Alan Greenspan really as dumb as he looks in creating the late housing bubble that threatens to bring the entire Western debt-based economy crashing down?

Was something as easy to foresee as this really the trigger for a meltdown that could destroy the world’s financial system? Or was it done, perhaps, "accidentally on purpose"?

And if so, why?

Let’s turn to the U.S. personage that conspiracy theorists most often mention as being at the epicenter of whatever elite plan is reputed to exist. This would be David Rockefeller, the 92-year-old multibillionaire godfather of the world’s financial elite.


The lengthy Wikipedia article on Rockefeller provides the following version of a celebrated statement he allegedly made in an opening speech at the Bilderberg conference in Baden-Baden, Germany, in June 1991:

"We are grateful to the Washington Post, the New York Times, Time magazine, and other great publications whose directors have attended our meetings and respected their promises of discretion for almost forty years. It would have been impossible for us to develop our plan for the world if we had been subject to the bright lights of publicity during these years. But the world is now more sophisticated and prepared to march towards a world government which will never again know war, but only peace and prosperity for the whole of humanity. The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national auto-determination practiced in the past centuries."

This speech was made 17 years ago. It came at the beginning in the U.S. of the Bill Clinton administration. Rockefeller speaks of an "us." This "us," he says, has been having meetings for almost 40 years. If you add the 17 years since he gave the speech it was 57 years ago—two full generations.

Not only has "us" developed a "plan for the world," but the attempt to "develop" the plan has evidently been successful, at least in Rockefeller’s mind. The ultimate goal of "us" is to create "the supranational sovereignty of an intellectual elite and world bankers." This will lead, he says, toward a "world government which will never again know war."

Just as an intellectual exercise, let’s assume that David Rockefeller is as important and powerful a person as he seems to think he is. Let’s give the man some credit and assume that he and "us" have in fact succeeded to a degree. This would mean that the major decisions and events since Rockefeller gave the speech in 1991 have probably also been part of the plan or that they have at least represented its features and intent.

Therefore by examining these decisions and events we can determine whether in fact Rockefeller is being truthful in his assessment that the Utopia he has in mind is on its way or has at least come closer to being realized. In no particular order, some of these decisions and events are as follows:

The implementation of the North American Free Trade Agreement by the Bill Clinton and George W. Bush administrations has led to the elimination of millions of U.S. manufacturing jobs as well as the destruction of U.S. family farming in favor of global agribusiness.

Similar free trade agreements, including those under the auspices of the World Trade Organization, have led to export of millions of additional manufacturing jobs to China and elsewhere.

Average family income in the U.S. has steadily eroded while the share of the nation’s wealth held by the richest income brackets has soared. Some Wall Street hedge fund managers are making $1 billion a year while the number of homeless, including war veterans, pushes a million.

The housing bubble has led to a huge inflation of real estate prices in the U.S. Millions of homes are falling into the hands of the bankers through foreclosure. The cost of land and rentals has further decimated family agriculture as well as small business. Rising property taxes based on inflated land assessments have forced millions of lower-and middle-income people and elderly out of their homes.

The fact that bankers now control national monetary systems in their entirety, under laws where money is introduced only through lending at interest, has resulted in a massive debt pyramid that is teetering on collapse. This "monetarist" system was pioneered by Rockefeller-family funded economists at the University of Chicago. The rub is that when the pyramid comes down and everyone goes bankrupt the banks which have been creating money "out of thin air" will then be able to seize valuable assets for pennies on the dollar, as J.P. Morgan Chase is preparing to do with the businesses owned by Carlyle Capital. Meaningful regulation of the financial industry has been abandoned by government, and any politician that stands in the way, such as Eliot Spitzer, is destroyed.

The total tax burden on Americans from federal, state, and local governments now exceeds forty percent of income and is rising. Today, with a recession starting, the Democratic-controlled Congress, while supporting the minuscule "stimulus" rebate, is hypocritically raising taxes further, even for middle-income earners. Back taxes, along with student loans, can no longer be eliminated by bankruptcy protection.

Gasoline prices are soaring even as companies like Exxon-Mobil are recording record profits. Other commodity prices are going up steadily, including food prices, with some countries starting to experience near-famine conditions. 40 million people in America are officially classified as "food insecure."

Corporate control of water and mineral resources has removed much of what is available from the public commons, and the deregulation of energy production has led to huge increases in the costs of electricity in many areas.

The destruction of family farming in the U.S. by NAFTA (along with family farming in Mexico and Canada) has been mirrored by policies toward other nations on the part of the International Monetary Fund and World Bank. Around the world, due to pressure from the "Washington consensus," local food self-sufficiency has been replaced by raising of crops primarily for export. Migration off the land has fed the population of huge slums around the cities of underdeveloped countries.

Since the 1980s the U.S. has been fighting wars throughout the world either directly or by proxy. The former Yugoslavia was dismembered by NATO. Under cover of 9/11 and by utilizing off-the-shelf plans, the U.S. is now engaged in the military conquest and permanent military occupation of the Middle East. A worldwide encirclement of Russia and China by U.S. and NATO forces is underway, and a new push to militarize space has begun. The Western powers are clearly preparing for at least the possibility of another world war.

The expansion of the U.S. military empire abroad is mirrored by the creation of a totalitarian system of surveillance at home, whereby the activities of private citizens are spied upon and tracked by technology and systems which have been put into place under the heading of the "War on Terror." Human microchip implants for tracking purposes are starting to be used. The military-industrial complex has become the nation’s largest and most successful industry with tens of thousands of planners engaged in devising new and better ways, both overt and covert, to destroy both foreign and domestic "enemies."

Meanwhile, the U.S. has the largest prison population of any country on earth. Plus everyday life for millions of people is a crushing burden of government, insurance, and financial fees, charges, and paperwork. And the simplest business transactions are burdened by rake-offs for legions of accountants, lawyers, bureaucrats, brokers, speculators, and middlemen.

Finally, the deteriorating conditions of everyday life have given rise to an extraordinary level of stress-related disease, as well as epidemic alcohol and drug addiction. Governments themselves around the world engage in drug trafficking. Instead of working to lower stress levels, public policy is skewed in favor of an enormous prescription drug industry that grows rich off the declining level of health through treatment of symptoms rather than causes. Many of these heavily-advertised medications themselves have devastating side-effects.

This list should at least give us enough to go on in order to ask a hard question. Assuming again that all these things are parts of the elitist plan which Mr. Rockefeller boasts to have been developing, isn’t it a little strange that the means which have been selected to achieve "peace and prosperity for the whole of humanity" involve so much violence, deception, oppression, exploitation, graft, and theft?

In fact it looks to me as though "our plan for the world" is one that is based on genocide, world war, police control of populations, and seizure of the world’s resources by the financial elite and their puppet politicians and military forces.

In particular, could there be a better way to accomplish all this than what appears to be a concentrated plan to remove from people everywhere in the world the ability to raise their own food? After all, genocide by starvation may be slow, but it is very effective. Especially when it can be blamed on "market forces."

And can it be that the "us" which is doing all these things, including the great David Rockefeller himself, are just criminals who have somehow taken over the seats of power? If so, they are criminals who have done everything they can to watch their backs and cover their tracks, including a chokehold over the educational system and the monopolistic mainstream media.

One thing is certain: The voters of America have never knowingly agreed to any of this.


Richard C. Cook is a former U.S. federal government analyst, whose career included service with the U.S. Civil Service Commission, the Food and Drug Administration, the Carter White House, NASA, and the U.S. Treasury Department. His articles on economics, politics, and space policy have appeared on numerous websites. His book on monetary reform entitled We Hold These Truths: The Promise of Monetary Reform is in preparation. He is also the author of Challenger Revealed: An Insider’s Account of How the Reagan Administration Caused the Greatest Tragedy of the Space Age, called by one reviewer, "the most important spaceflight book of the last twenty years." His website is at www.richardccook.com
Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization.

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[donkeyotay]

86. Compare this with your Ellen Brown post up-thread

and it's pretty obvious that something has gone seriously astray in our national experiment.

Benjamin Franklin’s Solution

Nationalization has traditionally had a bad name in the United States, but it could be an attractive alternative for the American people and our representative government as well. Turning bankrupt Wall Street banks into public institutions might allow the government to get out of the debt cyclone by undoing what got us into it. Instead of robbing Peter to pay Paul, flapping around in a sea of debt trying to stay afloat by creating more debt, the government could address the problem at its source: it could restore the right to create money to Congress, the public body to which that solemn duty was delegated under the Constitution....The most brilliant banking model in our national history was established in the first half of the eighteenth century, in Benjamin Franklin’s home province of Pennsylvania. The local government created its own bank, which issued money and lent it to farmers at a modest interest. The provincial government created enough extra money to cover the interest not created in the original loans, spending it into the economy on public services. The bank was publicly owned, and the bankers it employed were public servants. The interest generated on its loans was sufficient to fund the government without taxes; and because the newly issued money came back to the government, the result was not inflationary.iii The Pennsylvania banking scheme was a sensible and highly workable system that was a product of American ingenuity but that never got a chance to prove itself after the colonies became a nation. It was an ironic twist, since according to Benjamin Franklin and others, restoring the power to create their own currency was a chief reason the colonists fought for independence. The bankers’ money-creating machine has had two centuries of empirical testing and has proven to be a failure. It is time the sovereign right to create money is taken from a private banking elite and restored to the American people to whom it properly belongs.

They also thought government derived its legitimacy from the governed. How ironic that allowing it to become otherwise was done under the banner of patriotism. Tansy's story is one of millions that could be told. I know personal versions of the same: our government presented itself as standing for our liberty while it betrayed the millions of citizens who went about their work and trusted their government.

Thank you Demeter for all these links. It's done nothing to lessen the anger I feel toward those who are exploiting us, but it is certainly educational.

[Robbien]

54. Golf Club Resorts are singing a song of woe

Golf course managers said they have heard all the excuses why golfers are laying down the clubs or dropping memberships: changing interests; relocating; changing jobs; and unusual family circumstances. And here's the 300-yard drive: Some longtime golf club members could be dropping course memberships because money they used to make in the stock market to pay club dues has dried up, said Peter G. Morici, an economist at the University of Maryland, College Park.

"This is when you see people cut back on their luxuries," Morici said. "The squeeze will now come when there's a slowdown on the economy."

. . .

For their part, some golf clubs are using their mulligan. To attract new members, golf clubs like Sparrows Point are offering discounted initiation fees to prospects.

At Hillendale, the club is offering 50 percent off the new member initiation fee if it's paid by the end of May. If financed through five annual payments, new members would save 25 percent, or $5,000.

The club's family membership usually requires a $20,000 initiation fee and an $800 monthly charge. Hillendale also requires members to spend at least $350 at its restaurant every three months.

http://baltimore.bizjournals.com/baltimore/stories/2008/04/14/story1.html?b=1208145600%5E1618471

The article states that golf attendance at publicly owned golf courses has increased dramatically. Resort golf membership costs about thirty grand a year (not including the thousands needed to tip the caddies). At the public courses it only costs about fifty bucks a game on a pay as you go basis.

[kineneb]

84. cuing up orchestra of tiny violins...

:nopity: :nopity: :nopity: :nopity:

[Demeter]

56. The Liquidation War...the coming of the Greater Depression...

DailyReckoning.com

We are way out in the high desert with no access to the news. This gives us a chance to think.
What we’re thinking about is that we have entered a much more dangerous and troublesome period in world financial history. The planet was leveraged up. Now it is going to be de-leveraged.

We have been talking about the battle between the forces of inflation and the forces of deflation. It is not clear which way it will go...or when. The feds – who favor inflation – seem to have the upper hand one week. The next week, Mr. Market – who seems to have thrown his lot in with the force of deflation – seems ahead on points.

Meanwhile, many of the foot soldiers are lost, separated from their units...shooting at their own men...and often blowing themselves up. Many don’t know which side they are on and are willing to switch sides at any minute. But in the fog of war you always get a lot of people bumping into one another. That’s why we get such peculiar reports from the front – such as when the feds cut short rates (which is inflationary)...but long rates nevertheless go up (which is deflationary). Or when the unemployment numbers go up (which is deflationary)...causing the dollar to fall (because investors expect another inflationary rate cut!)

No, we don’t know exactly which way it will go (so don’t ask us when gold will hit $2,000...or when the Dow will break below 10,000). But it scarcely matters. Because, we’re like the innocent civilians caught in the crossfire. Sooner or later, our assets are going to be shot down...and our liabilities are going to blow up. In other words, dear reader, this is not a war in which you should try to speculate on which side will win...this is a time to keep your head down.

It’s a Liquidation War...in which mistakes will be corrected BOTH by inflation and deflation. Take stock prices, for example. Our guess is that they’ll be taken down – either by inflation or deflation, or both. Prices will fall either in nominal terms, in other words, or relative terms. Already, adjust the Dow to the price of gold, or wheat, or oil, or copper and you get a very different picture. Instead of being flat over the last 10 years...the Dow is down a half to two-thirds.

“It’s the Greater Depression,” said Doug Casey at dinner Monday night, with a satisfied look on his face. “I’ve been expecting it for a long time. I was a little early. But now, it seems to be finally getting going.”

What happens in a Greater Depression? We don’t know, but we think we’re going to find out.

And we imagine its most important feature will be a general markdown of debt and the relative value of Western assets – stocks, houses, currencies, and labor. The East and developing world is on the rise; even if it stays put, the West, in relative terms, will sink.

Some assets will go into default – which is what is happening in the financial industry lately. UBS alone has lost 38 billion. Hedge funds are going broke. And the captains – present and past – of the financial industry are pointing fingers at each other.

Many people say we’ve seen the bottom for equities, and the financial sector in particular. Maybe in nominal terms. And maybe in the East and the developing world. But in America, in real, inflation-adjusted terms, we’d expect more of a selloff. The S&P is still selling for more than 18 times earnings; there is still plenty of room on the downside.

The financial sector looks particularly bad; there’s probably a lot more bad news coming. And since it was the big winner for the 25 years, it probably needs a bear market of at least 5 or 10 years. At the beginning of the boom in finance, which began roughly during the first Reagan Administration, people still wanted their children to grow up to be doctors, lawyers and businessmen. At the end of it, every mother’s son was encouraged to into ‘finance.’

But now, the bubble in finance is over. It will probably take many years before values appear and prices begin to rise – just look at what has happened in the NASDAQ. Or look at our favorite example – Japan. Many people thought Japanese stocks were a once-in-a-lifetime bargain after the Nikkei Dow crashed in 1990. Well, they’re an even bigger bargain today!

[TalkingDog]

91. so don’t ask us ... when the Dow will break below 10,000

Dag! I was hoping for a heads up so I could re-submit my date for matching ShrubCo's Inagural Dow numbers.

Well, I'll just have to think a little harder.....

[antigop]

58. Mid-year budget deficit at all-time high

http://money.cnn.com/2008/04/10/news/economy/federal_budget.ap/index.htm?postversion=2008041014

-- The federal deficit through the first half of this budget year is at an all-time high, underscoring the pressure the budget is coming under as the overall economy slumps.

The Treasury Department reported Thursday that the deficit through the first six months of the budget year totaled $311.4 billion, up 20.5% from the same period a year ago. That was the largest deficit for the first half of a budget year on record, surpassing the old six-month mark of $302 billion set in 2006.

Full-year estimate of $410 billion. The Bush administration, when it sent its budget proposal to Congress in February, estimated that the deficit for the whole year will total $410 billion, putting it very close to the all-time high in dollar terms of $413 billion.

However, private economists are forecasting a much bigger deficit, reflecting the country's current economic problems and a $168 billion stimulus package that Congress has passed in an effort to jump-start growth. Rebate checks will be mailed to 130 million households starting next month in an effort to boost consumer spending and make sure that any downturn is short-lived and mild.

Well, folks, they did it -- they destroyed Medicare. When they have to pay out of the Medicare trust fund, they can say "Ooops..so sorry...can't afford to pay it."

[Hugin]

63. ...

Wasn't this 'The Plan' all along?

But, like everything else they've done, by crashing along blindly ignoring centuries of regulation,
protocol, contracts, and just plain common sense... They've brought down everything else, too.

Just to serve an ideology that "Social Security and Medicare are bad." :eyes:





:tinfoilhat:

[antigop]

64. yes, they wanted to destroy SS and Medicare all along..they found a way to do it.

There is no money. They have bankrupted the country.

<edit to add> But the Medicare problem is, by far, a worse "problem" than Social Security.

[Hugin]

65. At one time, when I was younger...

and had a mind open to their foolishness... I asked them, Why or How it was 'bad'.

Most of them returned the blank glazed look of the brain washed... Others would reply, "It's Commie!"

So, I turned my quest to find out why "It's bad."

After years, the only thing I can come up with is that... "It wasn't their idea." and or it has something to
do with "The New Deal".

IT.WAS.NOT.THEIR.IDEA! Hell of a reason to think something is bad.

[antigop]

66. Yes, I think so-- SS and Medicare were two signature pieces of the Dem platform

Destroy SS and Medicare and you destroy two of the Dem's greatest accomplishments.

I think you are correct, Prag.

<edit to add> But the programs are so popular they couldn't just get rid of them -- people rose up against privatization of Social Security.

So they found a way to get rid of them by bankrupting the country.

[DemReadingDU]

67. We are truly bankrupt

Now the Fed is considering borrowing from the Treasury

see my link upthread, post #29
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3264046&mesg_id=3264204

[antigop]

68. yep. They did it. Mission accomplished. n/t

[MilesColtrane]

70. Instead of shrinking Medicare and SS small enough so they could be drowned in a bathtub...

...they just got a bigger bathtub.

[AnneD]

69. Morning Marketeers.....

:donut: and lurkers. Well, I tallied the figures and I lost 11.5% of my Roth IRA portfolio and my daughter lost a total of 7.8% from hers. Below is the excerpts from the letter I received.

"What would you do if you were hiking through the woods and saw a bear? If you listen to expert advice, you wouldn't make any sudden moves! I a bear market, the same advice holds true.

What is a bear market? When the market loses 15% or more of its value in a six-month period, it is called a bear market. A smaller loss (10-15%) is called a correction.

IT IS POSSIBLE THAT CONCERNS ABOUT THE ECONOMIC SLOWDOWN IN THE UNITED STATES WILL DRIVE THE MARKETS LOWER IN THE COMING WEEKS.:hide: If this happens, please remember that downturns are a normal and essential part of economic growth. They help eliminate market enthusiasm, :rofl: restore reasonable valuation :rofl: and generate opportunities for disciplined investors to lower their cost of investing through dollar cost averaging...."

It went on to say that since April of 1958 the average contraction or recession lasted 10.5 months while the average expansion has lasted for 64 months (source was www.nber.org/cycles.hmtl )

So was that a letter or what??????


I think my best bet is to withhold investing for a while and fully focus on paying down my debts. I am excited as of this next week-I will have paid off another card (on my half salary-that is a BIG deal).


I think Warpy has the right idea. I have been looking at some very inexpensive places (but up north). I can find a house for $20000-50000 in some small towns. As crazy as it sounds-we could pay cash outright for our home-remodel and still have money for a descent retirement if we watch our pennies. We are looking for a place with a good size yard for gardening, medical facilities nearby, and water. If you are willing to expand your horizons-it is amazing what you can find. Hubby actually got excited when I told him what I found. We can be fairly self sufficient if we need, we just need to find something reasonable and have the cash to pay for the deal when we find it.

Happy hunting and watch out for the bears. I have it in writing that they are out and about.:sarcasm:

[Hugin]

72. Morning AnneD...

:hangover:

:rofl:

[Hugin]

73. ~11:40 ET: "Helps Eliminate Market Enthusiasm"...

Look! Look! It's working! Mikey likes it! Mikey likes it!


Index Last Change % change

• DJIA 12444.95 -137.03 -1.09%
• NASDAQ 2321.40 -30.30 -1.29%
• S&P 500 1346.55 -14.00 -1.03%

:rofl:

[kineneb]

85. go rural, young (wo)man

After the Dot.com bust (Hubby worked for WorldCom), we did exactly what you are contemplating. Sold the house in the SF East Bay, moved north to a rural county, bought 1/4 acre, and installed a new mfg. house, for cash. All for around $100k... in California.

We did take out a small equity loan for the outbuildings, but my house payment, with taxes and insurance is about $300/month. One cannot rent a room for that. So I am staying here. Having the small loan actually saved the house for us when we went through Chapter 7. So it turned out to be OK.

Several friends will be helping in a gardening work exchange. They will do most of the gardening in exchange for use of the land and water here. So there should be lots of fresh vegies this summer.

[Tansy_Gold]

98. Likewise with me, kineneb

I used insurance proceeds to pay off the last two years of our mortgage, then sold and slightly downsized, paying cash for "new" place (acre w/older, remodeled mfg. home & substantial outbuildings) with some left over. No mortgage, but taxes, insurance, utilities (AZ) run about $500/mo. Like you, I can't rent for that, so I'm doing my best to hang on. I have some self-employment income to supplement the remainder of insurance and home sale proceeds. SS, if the system still exists by then, won't kick in for another year, and then at sharply reduced benefits.

Enron's collapse in 2000 had triggered my curiosity about derivatives and imaginary money, but since DU didn't exist then, I had nowhere really to turn. Then I had seen signs as early as 2002 that the housing market was going to cause major macro economic woes. I wanted to know what the extended repercussions of that bubble would be, but still didn't have an information resource. By 2004, I expected an incoming Dem administration to resolve some of the problems, but we all know what happened then.

This is why it irks me no end that the DNC has allowed the primary battle to shove EVERY OTHER NEWS ITEM off the media. And yes, I blame Howard Dean and the party bosses for this, and that includes all the Dem candidates, from Kucinich to Richardson to Biden to Clinton to Obama, every last goddess-damned one of them. This blather about letting the people choose and how a spirited race is good for democracy is a stinking load of crap, imho. It's a smoke screen to cover all the disgusting and dangerous stuff that's going on while we're watching youtube videos of utterly unimportant trivia -- and while our internal conflict is threatening to hand 1600 PA Ave to McCain on a silver platter.

Why aren't Olbermann and Maddow and Abrams and everyone else talking about the economy? Why is no one talking about the $516 TRILLION in derivatives? The media could "explain" this to us. Oh, I know, I know, I know. The "media" is in the pocket of the corporations and they don't WANT us to know what's going on.

You know what? I don't completely believe that. I think that given some of Olbermann's "special comments," he could just as easily do one on the billions of dollars that Wall Streeters have put in their pockets on the basis of nothing more than "I'll bet you, and if I win, you'll pay me, or you'll get your insurer to pay me, but if I lose, the taxpayers will pay you. Oh, yeah, and if you lose and your insurer can't pay me, we'll get the taxpayers to pay him. WE CAN'T LOSE!"

Bill Moyers has had David Cay Johnston on his show, talking about the corporate scams that feed the beast. What would happen if someone like David Cay Johnston showed up on Oprah? If she REALLY gave a shit about people, she'd have someone like him on. By the way, I have literally never seen an Oprah show; I can't stand the woman's voice.

I'm doing what I can to get by. I have legitimate job skills, I have transportation, I have my health, so now that I have other issues resolved, I'm trying to find some kind of job, which of course isn't easy in today's climate. BF provides some a$$i$tance and household maintenance skills, and I do have friends who contribute in other ways than cash. I'm not sitting out here in the middle of the desert alone. ;-)

One of my acquaintances said the other day that he wasn't worried about a stock market crash. He had his home in the north woods of Wisconsin and he could hunt and fish, his wife could garden, they could put a woodstove in for heat in the winter if they had to give up coming to AZ. And he had his guns to fend off any "city marauders" who might come to disturb his rugged individualistic survival scenario. He said the very thought of it actually appealed to him.

And you know, maybe that's what we should REALLY be afraid of.


Tansy Gold, returning to her hunt for gainful employment

(edited to revise Streeters' betting dialogue; TG used to be a novelist and sometimes she still has to tweak the ms.)

[ozymandius]

77. lunchtime update

12:09
Dow 12,434.04 Down 147.94 (1.18%)
Nasdaq 2,318.04 Down 33.66 (1.43%)
S&P 500 1,344.98 Down 15.57 (1.14%)
10-Yr Bond 3.4690% Down 0.0630
NYSE Volume 1,637,600,500
Nasdaq Volume 794,739,060

12:00 pm : The second largest company by market cap provided a disappointing earnings report and outlook, so it should come as no surprise that the stock market is posting hefty declines at midday. Each of the major indices are down at least 1%.

General Electric (GE 32.52, -4.23) has a massive 2.8% S&P 500 weighting, which makes it the second largest company behind Exxon Mobil’s (XOM 89.11, -0.44) 4.1% weighting. Given GE’s massive size and conglomerate nature, the market listens when it provides a disappointing outlook.

GE’s first quarter earnings slipped 6% to $0.44 per share, which falls short of the consensus estimate of $0.51. Its revenue fell $1.5 billion short of market expectations. The company cited weakness in its financial services business as the main factor behind its earnings miss.

Looking ahead, GE expects second quarter earnings per share will fall short of the consensus estimate by three to five cents per share. For full year 2008, GE expects to earn between $2.20 and $2.30 per share, versus the $2.43 consensus.

The news has shocked the market, as analysts generally expected decent earnings from GE--especially since the company typically reports earnings near its guidance. Several brokerages have lowered their ratings on GE. As a result, the company’s shares are down 11.5%, which marks the largest one-day percent decline since the 17.5% plummet on Black Monday--which occurred more than 20 years ago in 1987.

Economic data were nothing for the bulls to cheer about either. The April University of Michigan confidence survey fell to 63.2 from 69.5. This fell short of the expected reading of 69.0, and marks the lowest consumer confidence since March 1982.

In turn, nine of the ten economic sectors are posting a loss, with 103 of the 137 industry groups trending lower. Industrials (-3.6%) are seeing the most selling pressure in the wake of GE’s report. The defensive-oriented utilities sector (+0.1%) stands alone in positive territory.

Of note, the financial sector (-0.3%) is holding up pretty well despite GE citing weakness in financial services. However, the sector is underperforming for the week with a 3.1% decline versus the market's 1.9% slide.

Treasuries are seeing buying interest as investors seek safety. The benchmark 10-year note is up 19 ticks, sending its yield down to 3.47%.DJ30 -148.02 NASDAQ -32.05 SP500 -15.29 NASDAQ Dec/Adv/Vol 1921/761/754 mln NYSE Dec/Adv/Vol 2065/927/485 mln

[DemocratInSoCal]

80. TURN ON YOUR TV, CNBC Is Going To Explain Everything For Us!

The Fed auction today went Extremely Poorly. But CNBC is about to tell us how this is Good News! A sign that the credit market problems are easing. A sign that we've reached the bottom.

I POUNDED MY DESK & SCREAMED HOORAY!!!! THEY'RE GOING TO EXPLAIN TO US!!

Why Up Means Down. Left Means Right. Round Means Flat!! It's finally going to make sense. Here it comes.

[Hugin]

82. *whew*

Thanks for the heads up!

Thank GAWD and all that is Holey for the all knowing wisdom that is CNBC!11!!!$!

[Robbien]

90. And that GE missed earnings report thing

No biggie says CNBC guest. It's all good news because it is a sign that this is the end of all the financial write-downs. The bottom of the market is in our sights now.

Par-tay!

[TalkingDog]

88. While they are at the explanation of unlikely things, can they explain:

Why people insist on irritating you when you are already in a foul mood? (baiting the bear anyone?)

Why your car stops making that noise the second you pull into the mechanic's parking lot?

Why people reflexively continue to insist that things are okay? (I know, I know, Denial)

[Hugin]

87. ~13:40 ET: "Even less Enthusiasm"...

Index Last Change % change

• DJIA 12408.88 -173.10 -1.38%
• NASDAQ 2311.20 -40.50 -1.72%
• S&P 500 1342.06 -18.49 -1.36%


Seems to be settling in at that... 12,400.00 PISL.

I'll leave the explaining to CNBC. (snicker)

[AnneD]

93. See what happens.....

when you eliminate excess enthusiasm. I've seen dead mackerels with more enthusiasm.

Even a dead fish can go with the flow but losing 11% of your portfolio tends to make you want out of the water and up the falls.

[Robbien]

92. Bank of Ikeda to post 75 billion yen in losses

OSAKA--Bank of Ikeda, a regional bank based in Ikeda, Osaka Prefecture, said Friday it will post 74.6 billion yen in losses from selling marketable securities in its account settlement for the year that ended March 31.

The bank is expected to have 55 billion yen in deficits in the settlement after deducting taxes, which would be the largest in its history.

The bank's latent loss of marketable securities expanded due to turmoil in the financial market following the U.S. subprime mortgage crisis. The bank sold all foreign bonds, worth about 300 billion yen, and half of its domestic bonds, thereby reducing their marketable securities to 357.6 billion yen, or 61.7 percent less than the previous year.

http://www.yomiuri.co.jp/dy/business/20080412TDY09306.htm

Japan financial firms face 1.2 tril. yen subprime losses

Domestic banks, insurers and other financial institutions are likely to suffer combined losses of more than 1.2 trillion yen related to subprime mortgage loans in fiscal 2007 on a consolidated basis, it was learned Friday.

Mizuho Financial Group Inc.'s overseas mortgage-related losses will grow to 565 billion yen on a consolidated basis, the largest among the domestic financial institutions, the industry sources said.

. . .

The combined subprime loan-related losses of major domestic banks are expected to top 800 billion yen, according to industry sources.

Meanwhile, Nomura Holdings, Inc. has already said its subprime loan-related losses will exceed 100 billion yen, while Aioi Insurance Co. previously announced that it will post losses of 92 billion yen.

http://www.yomiuri.co.jp/dy/business/20080412TDY08308.htm

[ozymandius]

94. Here's a heaping helping of the Big Ugly to end the day.

Dow 12,325.42 Down 256.56 (2.04%)
Nasdaq 2,290.24 Down 61.46 (2.61%)
S&P 500 1,332.83 Down 27.72 (2.04%)
10-Yr Bond 3.471% Down 0.061
NYSE Volume 3,665,479,750
Nasdaq Volume 1,917,835,375

4:15 pm : Due to General Electric’s (GE 32.05, -4.70) massive 2.8% S&P 500 weighting and wide-range of businesses, the market pays attention when it provides a disappointing outlook.

Then it should come as no surprise that stocks got clipped on Friday after GE--the second largest U.S. company by market cap behind Exxon Mobil (XOM 88.62, -0.93)--reported earnings that handily missed estimates and provided a disappointing outlook.

GE’s first quarter earnings from continuing operations slipped 8% to $0.44 per share, which fell short of the $0.51 consensus estimate. Its revenue missed expectations by $1.5 billion. The company cited weakness in its financial services business as the main factor behind its earnings miss.

Looking ahead, GE expects second quarter earnings per share will fall short of the consensus estimate by three to five cents per share. For full year 2008, GE expects to earn between $2.20 and $2.30 per share, versus the $2.43 consensus.

The news shocked the market, considering in January GE said it expected first quarter earnings per share would be in the range of $0.50 and $0.53. Analysts generally expected decent earnings from GE--especially since the company typically reports earnings near its guidance.

As a result, the company’s shares lost 12.8%, which marks the largest one-day percent decline since the 17.5% plummet on Black Monday--which occurred more than 20 years ago in 1987.

Economic data also disappointed, although the market’s response was somewhat muted. The April University of Michigan confidence survey fell to 63.2 from 69.5. This fell short of the expected reading of 69.0, and marks the lowest consumer confidence since March 1982.

The bearish news weighed on stocks, with nine of the ten economic sectors ending the day with a loss. Of the 137 industry groups, 128 posted a loss, which paints a better picture of the broad-based weakness.

The industrials sector (-4.6%) posted the largest loss, while defensive-oriented utilities (unch) outperformed on a relative basis.

The Amex Airline Index got clipped 7.6%, extending its yearly decline to 29%. Frontier Airlines (FRNT 0.48, -1.09) sparked the selling interest after it filed for Chapter 11 bankruptcy protection. However, not all airlines posted a loss. Delta (DAL 10.01, +0.26) and Northwest (NWA 10.92, +0.09) rose on speculation they will soon announce a merger.

Treasuries saw buying interest as investors sought safety. The benchmark 10-year note gained 18 ticks, sending its yield down to 3.47%.

For the week, the Dow lost 2.3%, the Nasdaq shed 3.4% and the S&P fell 2.7%. The CRB Commodity Index gained 3.1%, with oil gaining 3.9%.

DJ30 -256.56 NASDAQ -61.46 NQ100 -2.9% R2K -2.7% SP400 -1.8% SP500 -27.72 NASDAQ Dec/Adv/Vol 2284/588/1.89 bln NYSE Dec/Adv/Vol 2397/724/1.26 bln

[AnneD]

97. The main course may taste nasty....

but there are plenty of juicy luscious side dishes served up on the thread. Have a good weekend folks.