STOCK MARKET WATCH, Tuesday November 25

[ozymandius]

Source: du

STOCK MARKET WATCH, Tuesday November 25, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 56
WHERE'S OSAMA BIN-LADEN? 2588 DAYS
DAYS SINCE ENRON COLLAPSE = 2879
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.
$1 USD = EUR 1.06678
$1 USD = JPY 116.6200

In recognition of those prescient of the Dow's precipitous return of Bush values (9/29/08): JuneBourder and AnneD

AT THE CLOSING BELL ON November 24, 2008

Dow... 8,443.39 +396.97 (+4.70%)
Nasdaq... 1,472.02 +87.67 (+6.33%)
S&P 500... 851.81 +51.78 (+6.47%)
Gold future... 819.50 +27.70 (+3.38%)
30-Year Bond 3.76% +0.09 (+2.51%)
10-Yr Bond... 3.34% +0.17 (+5.46%)






GOLD,EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[Demeter]

1. Good Morning, Ozy!

Good to have company in insomnia. At least it's not because I can't breathe, today!

How much more of this can the system or the people take? I'm expecting that we haven't really seen anything like a blowup yet, more like the pressure cooker rocking and whistling for attention...

[ozymandius]

7. Good morning Demeter.

:donut: :donut: :donut:

My sympathies for your continued illness. Are you feeling any better?

I spoke with two people yesterday with whom economic conversations are very rare due to their lack of interest. Citigroup's bailout struck a nerve. Not you, not I could ever expect to receive such individualized attention from the federal government. The people at the top who created this mess get to keep their jobs while the rank and file are shed. Citi still gets to change the terms of its contracts (to Citi's advantage, of course) with those beholden, like serfs, who have the misfortune to carry one of their debt cards. Citi can continue with bidness-as-usual. So their stock valuation has been saved. So what?

Even better - Citi has not been required to show plans to solve any of its problems like the automakers. With two trillion dollars in assets - solving one's own problems first should be a bedrock requirement.

Of those two people I mentioned: they are sick of this shit. Our collective quality of life, just like countless others, has decreased over the years. This is partly due to companies like Citigroup that have been given license to rob people blind by forever changing contract terms that enslave one to their debt programs.

Sick of it.

Sick of it.

-edited for stylistic clarity-

[Demeter]

10. And the Beat Goes On

Do they WANT a bloody revolution?

Probably not, but they think they can get away without consequence to themselves. After all, W did! Look out for another rocky year. We haven't turned any corner yet.

Aside from the economy, I am feeling much better, and willing to count myself among the living.
I think it was flu, which I got from a woman who had the flu shot. Evidently, it's only 44% effective this year (they guessed wrong).

[ozymandius]

25. Krugman is 'sick of it' too.

Citigroup

A bailout was necessary — but this bailout is an outrage: a lousy deal for the taxpayers, no accountability for management, and just to make things perfect, quite possibly inadequate, so that Citi will be back for more.

http://krugman.blogs.nytimes.com/2008/11/24/citigroup/

---

The comments are worth your time.

[tclambert]

30. And didn't Citigroup announce something like 50,000 layoffs?

But the Republicans keep saying they give (middle class) taxpayer's money to the rich and to corporations because "they're the ones who create jobs." Could there be a tiny error in their arithmetic somewhere? Maybe they left out a minus sign?

[Dr.Phool]

38. Well, they took the billions, and created 1,000 call center jobs in the Phillipines!

These people have a lot of gall.

I think Demeter is on to something. They must be trying to spark a revolution. They don't even try to hide the corruption anymore.

[Tansy_Gold]

49. And who is responsible? the booosh team or the incoming team?

I post this here only because, as always, I am looking for answers, even if my questions may seem to be mere rhetoric.

There are other threads on DU regarding the swift installation, if not actual inauguration, of the Obama presidency. Note is made of the "cooperation" of the outgoing regime with the incoming. Many of Obama's economic team were named or at least strongly suspected by late last week, and thus in place for any "cooperative" effort on the week-end Citi deal. Many of them are, of course, well-known veterans of the Clinton administration and have first- or second-hand ties to Greenspan, uberarchitect of The Fall.

So, did Obama and/or his team consult on the deal? Did they "approve"? Have they criticized or suggested modifications?

Are they really agents of change or shrugger moles?

Am I wrong to be upset with the PE, calling him a liar and a flip-flopper and betrayer of my/our trust? Must I wait until 20 January and afterward if there is sufficient evidence at hand on 25 November?

I'm outraged. If I'm alone (I'm not) or if my outrage is based on something other than a massive betrayal of trust, let me know. But so far the Obama defenders on the other threads have offered no countering evidence, only platitudes, blind loyalty, flame-throwing and name-calling.

Because I so rarely encounter that behavior on SMW, I return and remain




Tansy Gold

[Dr.Phool]

56. I think it's a co-operative effort or a criminal conspiracy. Take your pick.

I never did care all that much for Obama during the primaries, until it was down to him and Hillary. I felt that there was no "there" there, and he was hanging around with too many Chicago School boys, even then. And I certainly didn't think he would appoint so many Clinton retreads to his cabinet.

I haven't seen a cabinet pick I like yet, other than Richardson, and I think he would have been better at State. My only hope is, that he's surrounding himself with experience, but he's going to call the shots. But, that's looking less and less likely by the day.

I had lunch with John Russell, the 5th District congressional candidate and another campaign consultant yesterday. We all pretty much had the same opinion. But, we could be full of shit. In the mean time, I say start hunkering down. It's gonna get real nasty, a lot faster than we thought.

:scared: :hide:

[54anickel]

83. I'm somewhat skeptical, but reserve judgement for now. Will he lead? We'll have to

wait and see.

"The pessimist complains about the wind. The optimist expects it to change. The leader adjust the sails"
- John Maxwell

There was an article in the WA Post a while back that has me holding out for a glimmer of hope that he will quickly take the leader role....but I could just be full of shit and setting myself up for disappointment.

http://www.washingtonpost.com/wp-dyn/content/article/2008/10/08/AR2008100803890.html?referrer=emailarticle

[Ghost Dog]

90. Hey! I find I often think in wind/sailing terms

(adjusting sails, working the tiller, ropes, etc.; keeping an eye on the weather) these days...

Used to enjoy dinghy-sailing, and later small sailing-boat navigation, so much in my youth.

Now, I sit on the main path of the trade winds, watching, waiting, sticking an oar in from time to time, hoven (heaved?) to, but ready to pull the tiller towards my body, let her head fall off the wind and the sails fill once again; watching, closely, this time as ever, the course.

http://www.youtube.com/watch?v=PNS8iXMHRtA (Sinead O'Connor: Lord Franklin).

[54anickel]

116. Beautiful tune, thanks. Let us hope to stay out of Baffin's Bay whichever way the wind may blow.n/t

[Ghost Dog]

57. Thank you for being here and for not shrugging, Tansy

:grouphug:

[Tansy_Gold]

60. Ah, sweetheart, you're welcome. You and the good doc upthread.

¡Que buenos amigos!

[Dr.Phool]

62. Right back at ya kiddo!

:hi:

[Ghost Dog]

86. You warm the heart

with your so-bright intelligence, beachgirl. :)

[DemReadingDU]

59. I'm glad you're here Tansy

You write well what I can't put into words.
Sometimes I feel as if we are getting a reincarnation of the Clinton presidency. What happened to 'CHANGE'

[Tansy_Gold]

61. My sentiments exactly. Ugh. It's so damn scary.

I have paying work I need to do. Instead I sit here and stew over DU because the promise of 11/5 has become the dreary reality of 11/25.



In overcast Apache Junction,


Tansy Gold

[Hugin]

63. I'm still thinking on this, Tansy_Gold.

However, the shabby treatment of Dr. Dean, the embrace of Lieberman, and other assorted acts have me entertaining doubts
of whether or not the will of the people has been heard in Washington.

I will remind these people who feel they should govern from "The Center"... They were elected by very very few
right-wing votes. Their liberal base needs a bone or they will find themselves in the cold next to those they
replaced not so long ago.

Now, I understand the conventional wisdom of not backing a defeated foe into a corner. Politics 101 says they must
be allowed to save face or they will become not only a foe, but, a vengeful foe. This is true of one's friends as
well... I would suggest that the new Administration not turn their base into a vengeful foe.

Politics 101 also says that if one has unpopular (with the Status-Quo) tasks to accomplish it's best to do them early
in a term which gives plenty of kissing-of-babies and handing-out-of-candy time before the next election. Even Booosh understood this...

Quite frankly, I'm a little dumbfounded by the contradiction between PE Obama's speech in San Francisco WRT the rejection
of Government and embrace of various panaceas due to the fact the average people felt bitter about the Government not
being there for them in times of strife and what I see occurring now... It's exactly the same thing as was done before.

One more point, this bailout of Citi is well within the scope of the $700Billion bail-out bill. It's lack of oversight
essentially made Paulson King... It was Paulson who bailed out Citi and I doubt the White House even knew about it (by
design) ... I stridently warned about this transfer of power before the bad law was passed by the White House, Obama and
the rest of Congress. They've ceded their powers to the Corporations and Special Interests with that bailout bill and
we will live with the consequences of that decision for years and years and years and years.

I learned long ago, what I think doesn't matter in the scheme of things... Even if I'm correct.

[Tansy_Gold]

66. On the contary, Prag. What you think DOES matter

I have a paying gig I must quickly finish and can't elaborate now, but I assure you, what you think does matter indeed, if only to



Tansy Gold


:hi:

[UpInArms]

115. bless you, Tansy Gold!

you have managed to articulate my discomfort is the clearest manner possible.

Maybe I am way too skeptical, but I feel the sell-out going on.

:hug:

UIA

[Tansy_Gold]

117. We aren't alone: Greider - "Treasury Pick Has All the Wrong Ideas"

this was posted over in GD-P. I'm still getting flamed elsewhere, but I don't care ;-)



Obama's Treasury Pick Has All the Wrong Ideas
By William Greider, TheNation.com. Posted November 25, 2008.

Timothy Geithner is an architect, and now an enabler, of the unfolding crisis.

A year ago, when Barack Obama said it was time to turn the page, his campaign declaration seemed to promise a fresh start for Washington. I, for one, failed to foresee Obama would turn the page backward. The president-elect's lineup for key governing positions has opted for continuity, not change. Virtually all of his leading appointments are restoring the Clinton presidency, only without Mr. Bill. In some important ways, Obama's selections seem designed to sustain the failing policies of George W. Bush.

This is not the last word and things are changing rapidly. But Obama's choices have begun to define him. His victory, it appears, was a triumph for the cautious center-right politics that has described the Democratic party for several decades. Those of us who expected more were duped, not so much by Obama but by our own wishful thinking. (Tansy Gold would say that perhaps Mr. O suckered us in and took unfair advantage of that wishful thinking, but Tansy Gold is veeeeeeeeery suspicious these days.)

Let us stipulate that these are all honorable people, smart and experienced veterans of Washington combat. But they represent the Democratic party that mainly sees itself as managerial -- making government work better. The long era of conservative dominance has taught them to keep their distance from big reform ideas that promise fundamental change of the system. Their operating style is incremental and cautiously practical. They conscientiously avoid (or actively block) propositions that sound too liberal or radical. Alas, Obama is coming to power at a critical moment when incrementalism is irrelevant. The system is in collapse. Financial chaos won't wait for patient deliberations.

Events have confronted Obama with a fearful symmetry between past and present, illustrated by his choice of economic advisers. On Friday, we learned that Timothy Geithner, president of the New York Federal Reserve, would become his new treasury secretary and Larry Summers, who held the same position in the Clinton administration, would be the White House overseer of economic policy. On Monday, Geithner was busy executing the government's massive rescue of Citicorp -- the very banking behemoth that Geithner and Summers helped to create back in the Clinton years, along with Federal Reserve chairman Alan Greenspan and Robert Rubin, Clinton's economics guru. Now Rubin is himself a Citicorp executive and his bank is now being saved by his old protege (Geithner) with the taxpayers' money.

<snip>

I'll dig up the original DU post and see if I can get the link to the full article.

ETA link: http://www.alternet.org/workplace/108539/obama%27s_treasury_pick_has_all_the_wrong_ideas/



Tansy Gold, who does NOT like feeling duped.

[dixiegrrrrl]

121. In support of your view, Tansy Gold..

good to see ya, btw....:hi:

I made several thread comments, this week, with facts from Wiki on Summers, Geithner. and especially Robert Rubin.

Common threads with these guys were/are Kissinger, Council of Foreign Relations, Citibank,Greenspan, Rubin's role in eliminating Glass-Steagal.
These guys are all pals/protegees, and architects of the problem!

I can think of a couple rational reasons why Obama is picking them now,
and am willing to wait a few months into the Presidency to see what is what.
I recognize the man is on a tightrope of several dimensions.

On the surface, tho, all I see is a change in chefs, but same recipes, same food.

I remain cautious, as prepared as possible for the worst, hoping for the best, and knowing "money always talks".

[Tansy_Gold]

122. "hoping for the best" here, too.

:hi:

I learned a long time ago, in a totally unrelated context, that when I see something I think is dangerously wrong, I speak up. And I don't care who flames me! :evilgrin:

And for whatever it's worth, the comments I've made privately to friends not on DU have been even more critical.

It's just too weird. Just. Too. Weird.


Still working on the payin' work, 'cause it puts food on the table and in the dogs' dishes,


Tansy Gold

[muleboy303]

50. did i read right ?

rolling out the red (ink?) carpet for future american oligarchs ?

re: Citigroup ... if you give them $20Billion under an agreement in which they are responsible for the next $29Billion in losses and you (the FedGov) will assume liability for any losses over and above that, have you not just:

a: limited their future losses to $9Billion ?
b: incentivized them to divest themselves of their worst assets without regard to price ?
c: created an opportunity for third parties (insiders too ?) to purchase those 'bad' assets at prices so low that they then become potentially profitable (with the booked "losses" billed to the taxpayer?)

something sounds very wrong with this "rescue" until you remember that it's the Bush Administration with H.R. Haldeman's former aide from 1972/3 as the Secretary of the Treasury (who just happens also to be the former CEO of Goldman Sachs)

p.s. can you really "rescue" paper (now digital) "money" losses counted with 9 zeros by creating more digital money counted with 12 zeros ? (i guess we're about to find out)

p.s.s. if Citigroup operates in 109 countries, why is their "rescue" only the US' (taxpayers) burden ?

[UpInArms]

67. that pretty much sums up how they spread the wealth around after

the S&L debacle in the 80s

we (the taxpayers) guaranteed the losses and paid handsome management fees to contractors whilst fleecing the taxpayers of all valuable assets (see the Olney plan for details)

http://query.nytimes.com/gst/fullpage.html?res=940DEFD61F3EF936A25753C1A96E948260&sec=&spon=&pagewanted=all

also - Don Adam was a close friend of GHWB and he was Neil's subsequent employer (after Neil bankrupted Silverado S&L)

[muleboy303]

70. perilous parallels

iirc, the S&L "bailout" also wound up costing 5 times the original estimate over 5 years.

which, if the parallel holds true, would put the $700/$850 Billion Congress approved this year up over $3.5 Trillion by 2013. easily imagined now but unthinkable just a dozen weeks ago.

plus, the bailout discussions/enactments now requiring 9 to 12 zeros to delineate have the unintended (?) consequence of figuratively (pardon the pun) "trivializing" the dozen billion per month borrowed and spent in Iraq.

[Demeter]

84. Brainstorm! the Next Kid's Book: "If You Give Citibank a Bailout"

it's going to want another, and some loan guarantees. Then it wants to rewrite the terms on everybody's credit cards. Then..."

[UpInArms]

44. Others are sick of it too: We can't afford the Citigroup deal: Commentary: The government's credit i

http://www.marketwatch.com/news/story/At-rate-government-need-a/story.aspx?guid=%7B6F4AF0CA%2D9A05%2D4E38%2D9D82%2DD8E1D22739E2%7D

NEW YORK (MarketWatch) -- The Troubled Asset Relief Program was supposed to be the financial equivalent of "the big one." Drop one on the banking system, and the credit crisis would surrender.

Originally modeled on the Resolution Trust Corp. that swallowed failed savings-and-loans with bureaucratic consistency in the late '80s and early '90s, the $700 billion TARP and the $250 billion in equity injections spawned from it were supposed to shore up the banking system. It was supposed to be a painful but necessary step, like razing a swath through a city to halt an out-of-control blaze.

Well, the smoke cleared, and it turned out Citigroup Inc. (C: 5.95, +2.18, +57.8%) was still on fire.

First came concerns about Citi's commercial real-estate portfolio. Then it was credit-card debt. Citigroup fueled its own demise by saying it would absorb another $17.4 billion from its structured investment vehicle. It announced 50,000 job cuts and more asset sales. Then came a controversy about the board's support of its chairman, Win Bischoff.

With the stock at $3, it clearly wouldn't be long before lines would start forming outside Citibank branches around the globe. For an institution with $3 trillion in on- and off-balance-sheet assets, that $25 billion Citi had under TARP might as well have been 25 cents.

So now we have a bailout of a bank that allegedly had been bailed out less than two months ago. Fine. But what's the cost? Under the plan, $29 billion of losses in that portfolio will fall to Citigroup. After that, the government will absorb 90% of the losses. About $306 billion in assets have been identified as at risk, so taxpayers are essentially on the hook for $250 billion.

Think about that for a minute. Much of the credit at risk is credit-card debt. These "asset-backed" securities have been put at risk, in part, by banks that ratchet up interest rates to as much as 30% for late payments. But now, people -- many of whom are falling behind on their credit-card payments -- will now have to shoulder another debt: Citigroup's. And who do you think will get the profits should those loans get paid? Citigroup, of course.

...more...

[Demeter]

2. Portugal’s electric car deal leads way

http://www.ft.com/cms/s/0/36386d38-b980-11dd-99dc-0000779fd18c.html
By Peter Wise in Lisbon

Published: November 23 2008 17:13 | Last updated: November 23 2008 17:13

Portugal is to become the first European country to be supplied with electric cars by Renault and Nissan after signing an agreement to create a national network for zero-emission vehicles within three years.

The plan highlights Portugal’s commitment to invest in clean energy, despite concern that the global financial crisis is deterring governments from implementing ambitious European Union plans to fight global warming.

EDITOR’S CHOICE
In depth: Auto industry - Nov-23Under the agreement, finalised with the Franco-Japanese carmaking alliance over the weekend, 320 vehicle charging locations will be operational across Portugal by 2010, growing to 1,300 by the end of 2011.

Companies and motorists who buy electric cars will be exempt from road and other automobile taxes and individuals will qualify for income tax benefits of up to €800 ($1001, £673), said José Sócrates, prime minister.

The government will also require 20 per cent of public sector vehicle purchases to be zero-emission.

Despite slow economic growth and public spending restraints, Portugal is engaged in a large-scale programme to produce up to 60 per cent of its electricity from wind, sun, wave and other clean energy sources by 2020.

The EU has proposed reducing carbon dioxide emissions by 20 per cent by 2020, but efforts to adopt a reform package by January have been undermined by the global downturn.

Under the Portuguese plan, Renault-Nissan will supply Portugal with electric cars, with a range of 160km from early 2011, about a year before the alliance is scheduled to begin marketing the vehicles globally.

[Demeter]

4. Germany rejects General Motors' plea for state aid

http://news.xinhuanet.com/english/2008-11/12/content_10345187.htm

Special Report: Global Financial Crisis

BERLIN, Nov. 11 (Xinhua) -- The German government on Tuesday rejected a plea from U.S.-based General Motors (GM), the world's biggest carmaker, for targeted aid for its German factories.

Opel, GM's German arm, had earlier written to Chancellor Angela Merkel requesting that she push harder for a 40 billion euro (51.4billion dollar) loan from the European Investment Bank (EIB) to carmakers, German news agency DPA reported.

Opel also requested soft loans for German buyers of new cars and a government buy-in of older cars to stimulate the flagging German car market.

Merkel's coalition government last week agreed on an economic stimulus package that includes a suspension of vehicle tax for one year on new cars bought in Germany, with a double rebate for low-emission cars.

Yet, a government spokesman said no further plans had been made, and the EIB credit to the auto industry, according to the stimulus package, was likely to be decided upon by European Union leaders at a summit next month.

GM, whose shares hit a 65-year low of $2.76 when they tumbled 15 percent on Tuesday, has also lobbied the U.S. government for financial aid. The U.S. Treasury has so far refused to extend its Troubled Asset Relief Program (TARP) to U.S. carmakers.

[Demeter]

24. Why the GM - Cerberus - Chrysler Bailout is Bad for Taxpayers

http://www.informationclearinghouse.info/article21171.htm


November 6, 2008 -"TTAC" - -

Cerberus Capital, a highly secretive NYC-based vulture investment fund, wants the U.S. government and taxpayers to bailout its failed investment in Chrysler and its failing investment in GMAC. Its partner in this raid on the US Treasury is General Motors, a woefully insolvent automobile manufacturer whose CEO is paid $40k each day. Here’s why a bailout for GM and/or Chrysler is a bad idea.

Background

Cerberus Capital uses hedge funds as the vehicles in which to invest in various companies. Apparently, the hedge fund known as Cerberus Series 4 is the owner of an 80 percent interest in Chrysler and a related fund owns or controls a 51 percent interest in GMAC. Not surprisingly for a company known for its secrecy, Cerberus has not disclosed which entities actually own the interests in Chrysler and GMAC, has not disclosed what fees Cerberus has taken or accrued from its investments, and has not disclosed what severance payments would have to be made if GM actually acquired Chrysler. For example, would Chrysler CEO Bob Nardelli get another big payday if he’s cut loose in a merger? The interrelationships among GMAC, Chrysler Financial, Cerberus and other entities are also a well-kept secret.

Secrecy, Secrecy, Secrecy

Why is everything so secret? What happened to the idea of open government? A few questions come to mind:

1. Exactly what is the Cerberus/GM proposal to borrow $10b from the US Treasury in order to fund a merger, the terms of which are also secret? Is it in writing? Where is a copy? What were the proposed terms that were rejected by the current US Treasury? Is another proposal in the works? How is the $10b going to be repaid by two insolvent auto manufacturers?

2. Which lobbyists represented GM and Cerberus in getting their loan application before the US Treasury? How much were the lobbyists paid? With whom did GM/Cerberus meet? Where are the notes of any meeting or other communications about the loan proposal?

3. What do we know about the financial condition of the proposed borrowers? Where is Chrysler’s current balance sheet and income statement? Surely Chrysler is insolvent on an equitable basis, and probably insolvent on a balance sheet basis. Why is basic financial information not available for public inspection and comment?

4. Where are the financial statements for the Cerberus Series Four hedge fund? US taxpayers are being asked to bailout the failed auto related investments by Cerberus Series Four, while the profitable investments in the same fund are not being shared with taxpayers.

GM is woefully insolvent and should file Chapter 11

5. As of June 30, 2008, GM had total assets of $136b and total liabilities of $191b, a $55b deficiency. Thus, GM is insolvent. How can GM ever repay a $10b bailout, or any bailout for that matter? As of June 30, 2008, its current liabilities were $70b, dwarfing its current assets of $55b. Moreover, we do not know what deals GM has made to stretch/defer repayment of its account payables.

6. Is Chrysler in any better shape than GM? Probably not, but without a current balance sheet the definitive answer is a secret.

7. Assuming Chrysler is insolvent (liabilities exceed assets), then the equity interest of Cerberus and Daimler (the 20 percent equity owner) are worthless and these entities are not even entitled to a seat at the merger negotiating table. The real economic owners of Chrysler are its creditors and employees, who are also in the dark about the proposed US treasury bailout.

Who really benefits from a GM/Cerberus/Chrysler merger?

8. The US taxpayers can’t benefit since there is no repayment plan. Not surprisingly, Cerberus and its hedge fund are back door beneficiaries, because the 51 percent Cerberus ownership interest in GMAC will increase in value if GM and GMAC survive. Chrysler is a lost cause, but with the value of the Cerberus investment in GMAC also plummeting, Cerberus is trying to prop-up GMAC by helping GM survive. Is Cerberus pledging its equity interest in GMAC to the US Treasury as security for a government loan to GM? Why not? Is GM pledging its 49 percent equity interest in GMAC to secure repayment of any loan by the US Treasury? More secrets kept from the public.

9. The self-dealing by Cerberus extends to wanting to cherry-pick the Chrysler assets and keep the auto financing arm for itself. What is the value of the Chrysler auto financing business, and why should Cerberus benefit?

10. GMAC had negative net income of $3b for the first 6 months of 2008. GM’s ownership interest in GMAC was impaired by at least $2.7b during the same six month period, meaning that Cerberus Series Four hedge fund had suffered a similar loss in value in its investment in GMAC. Why should taxpayers bailout the millionaire investors in the Cerberus hedge funds?

More secrecy and lack of disclosure

11. Does GM plan to make any payments to GMAC, payments that directly benefit Cerberus? As vehicle residual values decrease, GM is obligated to make payments to GMAC under “residual support and risk sharing” agreements. On August 6, 2008, GM paid GMAC/Cerberus $646m, money which could have been used by GM to fund its ongoing operations and its obligations to employees.

12. Should any taxpayer money be used to fund payments to GMAC/Cerberus, whether that money is used directly or indirectly? How much, if anything is Cerberus investing in new money to prop up its investment in GMAC? If it is not investing in Chrysler or GMAC we can reasonably conclude that its analysis shows that the investment is a bad one. What’s bad for Cerberus is bad for the US Treasury.

Although it appears that the Cerberus Series Four has money available to make follow-on investments, it makes no sense to throw good money after bad if you can lobby the US Treasury to make the bad investment for you. A related question is whether the Cerberus equity interests in GMAC are going to be used as collateral for the loans that will be used (albeit indirectly) to bailout GMAC. Why should equity bear none of the risk but get all of the benefit?

More non-disclosure

13. What is Cerberus ResCap Financing LLC and who has seen its financial statements or the agreements relating to the $3.5b secured loan facility? How is this secured loan impacted by the bailout of Cerberus/GM/Chrysler?

Deepening insolvency is likely

14. GM’s current insolvency and continuing losses will trigger additional liabilities, and make it doubtful that GM will be able to make payments promised to employees and former employees or perform its labor agreements. GM’s worsening financial condition also deepens its losses from its derivative contracts. How would a GM/Cerberus Chrysler merger affect these liabilities? Will any government loans be used to reduce the $30b of GM accounts payable, or, in the event of a merger, to pay down Chrysler accounts payable in some still unknown amount? Sadly, we don’t even know what Cerberus proposed as the use of funds and we have no idea how Cerberus will benefit since we have no financial information on Chrysler or Cerberus.

15. As GM and Chrysler idle plants and facilities, more employees are laid off the employee related liabilities of GM/Chrysler will increase by hundreds of millions. Since GM and Chrysler are insolvent, who will pay these increased costs? Can any of these costs be avoided in a Chapter 11 case of Chrysler or GM?

16. Should taxpayer money be used, directly or indirectly, to pay GM and Chrysler obligations that are coming due while these entities are unable to pay from their own assets. Surely not, but what is being proposed, and who will benefit if GM debt is redeemed at par by vulture investors that bought the debt at pennies on the dollar? A related question: will any Cerberus entities benefit from government funded redemptions of auto maker debt? Is it possible that Cerberus is trading in credit default swaps and actually benefiting from the difficulties of Chrysler, GM and GMAC? Yet more items of non-disclosure on a long list of secret items.

CONCLUSION AT LINK

[DemReadingDU]

31. GM - Cerberus - Chrysler Bailout is Bad for Taxpayers??? but

bailing out the banksters is good for taxpayers

:sarcasm:

[Roland99]

41. Sure is an awful lot of unanswered questions!

And they're likely to remain unanswered forever.

[Gregorian]

96. Great news. Even if it is entering the new world backwards.

First we need to figure out how to generate the electricity. Then the cars come. But I'll accept this as long as what follows is renewable generation.

Great! I have "renewed" faith in mankind.

[ozymandius]

3. Market WrapUp

A Bridge Too Far
The energy sector will be back, all too soon
BY TONY ALLISON

Despite recent evidence to the contrary, the global economy is not headed back to the Stone Age. It is also doubtful that China is preparing a new Cultural Revolution to ship hundreds of millions of city dwellers back to work the land, and to get over dreams of new cars and refrigerators. On the contrary, the developing world may pause in its development, but it won’t stop and it won’t settle for the limited dreams of earlier generations. While the ongoing global economic crisis will be very painful, it also may buy a few more precious years before the effects of Peak Oil begin to hit home with a vengeance.

....

The problem of 9.1% global oil depletion (and perhaps higher in future years) adds confusion and complexity to political issues such as pulling out of oil-producing Iraq, global warming, relations with Russia etc. There will be many tough choices ahead for the new administration.

No politician likes to acknowledge bad news such as Peak Oil, but this economic downturn, no matter how severe, will not prevent the inevitable. It’s like holding off a river of volcanic lava with a brick wall. Eventually the forces of nature will breach the wall. Peak Oil will hit much harder in the energy-dependent nations. The US, unfortunately, now must import roughly 70% of its energy needs. It’s human nature to put off bad news and sacrifice as long as possible. But if the new administration has the political courage, it should start an all-out crash program to create more domestic energy, of all types, as soon as humanly possible. Perhaps just as important, the Obama Administration needs to work closely with other major energy-consuming nations on a massive program to jointly prepare for the effects of ongoing global energy depletion (before the bullets start flying).

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

[tama]

16. Let me guess

This reminder will pass unnoticed.

[Demeter]

5. You Ain't Seen Nothing Yet By Mike Whitney

http://www.informationclearinghouse.info/article21313.

"The problems we face today cannot be solved by the minds that created them" Albert Einstein

November 24, 2008 "Information Clearinghouse" -- Obama hasn't even been sworn in yet, and already the Wall Street cheerleaders are celebrating his first great triumph. According the pundits, the stock market staged a surprise 494 point rally on Friday because--get this--it was announced that Timothy Geithner would be appointed Obama's Treasury Secretary.

Timothy who?

What nonsense. The sudden turn-around in stocks had a lot more to do with short-covering than anything else, but don't let that get in the way of a good story. Even so, the last minute surge on the NYSE couldn't stop another week-long bloodbath that ended with the Dow and S&P 500 tumbling another 5 percent. That's not to say that Geithner is not bright and talented guy. He is; and so is his White House counterpart, Lawrence Summers. But the media hype is way overdone. Geithner doesn't drive the markets and he isn't "change you can believe in". In fact, he's a protege of Henry Kissinger, a member of the Council on Foreign Relations, and has the same political pedigree as his predecessor, Henry Paulson. They're both part of the ruling fraternity and their views of the world are nearly identical. There's no doubt that Geithner will be more competent and effective than Paulson but, then again, who wouldn't be? Paulson may be the biggest flop at Treasury since Andrew Mellon steered the country onto the reef during the Great Depression. The recent flap over the Troubled Assets Relief Program (TARP) just proves the point. After convincing Congress to pass a $700 billion bailout plan--by invoking the specter of economic Armageddon and martial law--the former G-Sax chairman proceeded to set up a program for buying back mortgage-backed securities (MBS) and other junk paper from his banking buddies. Paulson argued that removing the crappy loans would help the banks get back on their feet and start lending again. Of course, no one could really figure out how the process was going to be executed, but maybe that's just nit-picking. Fortunately, Paulson never got a chance carry out his plan. He was torpedoed by the stock market which plunged seven days in a row losing nearly 20 percent of its value until Paulson threw in the towel and did what 200 economists had suggested from the very beginning---buy preferred shares in the banks so they could rev-up their credit engines again.

Will Geithner be that stubborn? Not likely. And Paulson is a hard-nosed class warrior, too. Notice how every dime of the bailout has gone to banksters while all the efforts to provide relief to autoworkers, consumers or struggling homeowners have been blocked. Anyone who isn't in the upper 1 percent income bracket can forget about getting a helping hand.

Paulson shoveled $25 billion to Citigroup without even sending in the regulators to see if they were solvent or not. How smart was that? Citi's stock has dropped 93% from its all-time high in May 2007 and ended Friday at a measly $3.77 per share. Its market cap. has gone from $280 billion to a skinny $20 billion in less than a year. Without a lifeline from the government, they won't make it through December; the short-sellers will carve them up like a smoked ham. Will Paulson come to Citi's rescue with more public cash? Absolutely. So why won't he support a similar bailout for the Big Three auto-makers who employ nearly a million people?

There was a clue in Sunday's paper as to why Paulson is stiffing the car companies. According to UPI :

"GMAC Financial Services said Thursday it had applied to the U.S. Federal Reserve for bank holding company status, a step toward securing federal aid. The auto and home financing company said it had also submitted an application to the U.S. Treasury to participate in the Capital Purchase Program set up in the $700 billion financial firm bailout program known as the Emergency Economic Stabilization Act.

"As a bank holding company, GMAC would obtain increased flexibility and stability," the company said in a statement." (UPI)

So why would GMAC want to become a bank holding company if General Motors is headed for the chopping block? Could it be that the government is working out a secret deal with management to put the company through Chapter 11 (reorganization) just so it can crush the union and eliminate their pension and health care benefits in one fell swoop? You bet. Car workers will be reduced to slave wages just like they are in sunny Alabama where sharecropping has moved indoors. And--no surprise--the Democrats are right on board with this labor-busting charade. The auto industry isn't going to be shut down. That's just more fear-mongering like the blather about martial law and WMD. Detroit is going to be transformed into a workers gulag; Siberia on Lake Michigan, which is why Paulson is withholding the $25 billion. It's plain old class warfare.

Paulson has tried to spread the myth that his bailout eased the credit crunch, but it's not true. The stress in the credit markets was caused by very precise factors (Libor, the TED Spread, OIS-Libor) which were intentionally allowed to rise to perilous levels so Paulson could coerce Congress into giving him his bailout loot. It wasn't until Congress caved in that the FED addressed those market indicators by (setting up a new facility and) providing an explicit government guarantee on commercial paper and money markets. That's what made Libor go down, not Paulson's misguided TARP program which did absolutely nothing...

Geithner will never engage in the same cynical antics as Paulson. It was Paulson who set up the Super SIV (Structured Investment Vehicle) after 2 Bear Stearns hedge funds blew up so he could help Citigroup and other financial institutions pawn-off their off-balance sheets garbage to investors by placing the US treasury's seal of approval on the rotten paper; another shameless rip-off shrink-wrapped in the Stars and Stripes....



ENTER GEITHNER

Geithner is nothing like Paulson. He's discreet, practical, non ideological and diplomatic. His job is to find a way to plug the holes in a banking system that is undercapitalized by a whopping $2 trillion dollars while trying to keep the broader economy from crashing to earth. He's already concocted a stimulus plan (with Summers help) that should be big enough to get the country through the first quarter of '09 ($700 billion), but it will take sustained government spending via infrastructure and green technologies programs to make up for the staggering losses to consumer spending. Expect the red ink to flow knee-deep from the purple mountains majesty all across the fruited plains, and pray that China and Japan keep buying US Treasurys or the country will face historic hyper-inflation.

Geithner knows that his mandate far exceeds his job description. Consumer confidence is at record lows because the public has lost faith in their institutions. The fear-mongering and the deception of the last 8 years have taken their toll; the pessimism is palpable. But market-based systems require confidence to function properly, otherwise people withdraw their savings and hoard their money. And that is exactly what is happening. We have entered a period of extreme risk aversion where there's been a steady run on the financial system; investors have pulled their money out of commercial paper, structured investments, money markets, corporate bonds, and securities. The markets are in a state of panic. Investors are moving into safe havens like Treasurys while consumers are cutting back on spending. The whole system is contracting. The same thing happened during the Great Depression. The similarities are stunning. In Jason Zweig's "1931 and 2008: Will Market history Repeat Itself" the author says:

"Over the two weeks ended Nov. 20, 2008, the Dow Jones Industrial Average fell 16%. Over the two weeks ended Nov. 20, 1931, the Dow fell 16%.

If you think that is scary, consider this: In the final five weeks of 1931, the Dow fell 20% further. Then it went on to lose yet another 47% before it finally hit rock-bottom on July 8, 1932

It is vital to realize that markets are never under some obligation to stop falling merely because they have already fallen by an ungodly amount. It also is vital to explore how bad the worst-case scenario can get and to think about how you would respond if it comes to pass.

When it comes to worst-case scenarios, 1931-1932 is it. When the Dow finally stopped going down, in July 1932, it had lost 88% in 36 months. At that point, only five of the roughly 800 companies that still survived on the New York Stock Exchange had lost less than two-thirds of their value from their peak in 1929." (Wall Street Journal)

Geithner's job is to restore confidence through transparency and consistency. No more lying. No more fudging the numbers to keep the public in the dark. Investors are already voting with their feet. It will take trust to get them to come back. Geithner has a clean slate to work with, but if he chooses Paulson's route--the path of deception--he'll fail, too. He's got one chance to make good; otherwise....To his credit, he has made statements confirming his determination to reform the system. This is what he said to Congress in recent hearings:

"The United States will have to have to undertake substantial reforms to our financial system. There was a strong case for reform before this crisis, our system was designed in a different era for a different set of challenges. But the case for reform is stronger today. Reform is important because a strong and resilient financial system is integral to the performance of any economy. ...I think the severity and complexity of this crisis makes a very compelling case for a broad and comprehensive reassessment of how we use regulation to achieve an appropriate balance between efficiency and civility. This is extremely complicated both in terms of the tradeoffs involved but also in terms of building the necessary consensus involved both here in the United States and around the world. It is going to require significant changes in the way we regulate and supervise financial securities; changes that in my view, need to go well-beyond modest adjustments to some of the specific capital charges in the existing capital regime as it applies to banks."

Good. Investors want rules, guidelines, supervision, regulations and most of all accountability. Justice should be the organizing principle in the financial system just as it is in the legal system. That means securities fraud has to be investigated and prosecuted. No free passes for banking mandarins and toffee-nose fund managers. Break the law and go to jail, just like Jeffrey Skilling. This is the biggest financial meltdown in US history and not one CEO or CFO has even been indicted. Instead, the SEC wastes its time harassing Dallas Maverick's owner Mark Cuban in a politically-motivated witch hunt. What a fiasco. Why not clean up the cesspool on Wall Street first. That's where the problem is and that's how one reestablishes credibility.

Then there's the heavy lifting of rebuilding financial markets while hedge fund redemptions are approaching 50 percent, corporate bonds have dropped by nearly half, commercial property is tanking, consumer spending is in the dumps, and the housing market continues to crumble. That's not an easy task. And, at the same time, banking behemoth Citigroup needs an immediate injection of capital just to maintain operations. Once again, the Treasury will assume a gigantic liability to avoid wider damage to the system. According to the Wall Street Journal:

"The federal government agreed Sunday to take unprecedented steps to stabilize Citigroup Inc. by moving to guarantee close to $300 billion in troubled assets weighing on the bank's books, according to people familiar with details of the plan...Treasury has agreed to inject an additional $20 billion in capital into Citigroup under terms of the deal hashed out between the bank, the Treasury Department, the Federal Reserve, and the Federal Deposit Insurance Corp....In addition to the capital, Citigroup will have an extremely unusual arrangement in which the government agrees to backstop a roughly $300 billion pool of its assets, containing mortgage-backed securities among other things. Citigroup must absorb the first $37 billion to $40 billion in losses from these assets. If losses extend beyond that level, Treasury will absorb the next $5 billion in losses, followed by the FDIC taking on the next $10 billion in losses. Any losses on these assets beyond that level would be taken by the Fed."

Also, keep in mind, that when 2 Bear Stearns hedge funds went belly up in July 2007, the experts all agreed that there were probably only $200 to $300 mortgage backed securities (MBS) in the whole system. Now we find out that there are $300 billion on Citi's balance sheet alone! More lies. In truth, there were more than $5 trillion in MBS created between 2000 and 2006. A large portion of those are held by banks. That means more trouble ahead.

[dixiegrrrrl]

9. G'Morning Demeter....ty for posting this piece.

I especially liked the phrase " since Alabama moved sharecropping indoors".

[Demeter]

22. Tough Sledding Ahead: Surviving A Coming USD Collapse By Christopher Laird

http://www.informationclearinghouse.info/article21179.htm


November 09, 2008 "Gold Eagle" -- Now that the US election is over, we get to think about the Future. And, no matter how you look at it, the entire world, the West particularly, is in for tough sledding financially. First, we will continue to battle an emerging economic slowdown. Then, later, we will be battling world currency instability – we already have signs of this now. Even though gold and commodities have taken a big hit because of a general liquidation in everything, there is one thing none of us should lose sight of, and that is what happens when the USD finally lets go.

Why the USD is presently rallying

Just because the USD happens to be rallying now (with weekly fluctuations) does not mean that its fate is not bleak. There are many reasons the USD is rallying right now. They include flight to cash in general during market liquidations in all areas, but also cash hoarding because businesses cannot roll over the short term credit they use to do payrolls and ongoing operations. Then we have the usual end of year cash surge for businesses and financial institutions. Then of course there is flight to the USD for safety, and then finally, other countries currencies are adjusting to the slowing world economy, and the once hot foreign markets are cooling and there is lots of money moving out of the ‘emerging’ markets.

But, we are going to be facing two particular problems in 09 that none of us is really used to, that we really have never seen. The world is going to have a severe recession bordering on an economic depression. Essentially no one alive today knows what that is like. Only the oldest of us have lived through that experience. But then, on top of that, at some point later the USD will finally collapse. This is not something way way out there in the future. This issue is becoming a near term threat.

What has held the USD up and why that’s going to change

The primary reason the USD has held up so well in the last decades, in spite of ever worsening US trade and budget deficits that add to over $1 trillion a year combined, is that the US was an export economy’s dream customer. Because the US was such a good customer to the world, they bought our US Treasury bonds, and lent trillions in other ways to the US consumer. As long as the US consumer could carry that process out, our trade partners could make bank on the US and USD. However, once the US consumer is tapped out, and cannot effectively make a return on investment of our trade partners, the rationale for the continuation of the USD goes away. All that remains after that is a budget busted US Federal government. At that point, why would our trade partners continue to buy all the US treasury bonds and such, and debase their currencies, if the US cannot be such a good customer anymore? At that point, the USD will rapidly fall into a devaluation crisis.

None of us in the US has ever dealt with the twin threats coming our way in the next few years. The first is a real economic depression. The second will be the demise of the US dollar, or at the very least, its severe devaluation like 70% or more (at first). I would like to point out that in the last great depression in the US in the 1930’s, we did not have a combination of a currency crisis with the economic crisis. The USD, although it fell compared to gold, held up well. Deflation increased the value of anything called cash, including gold. This time, the outcome will be different. This time, the US faces an economic depression AND a currency crisis soon after. How far off is this?

Well, first, we are already well into the beginning of the economic depression. The damage done to the world credit and financial markets has been stunning since August 07. Over $35 trillion of value has been lost in the world financial markets. That has spilled over into the real economy now, and we will start to see bigger and bigger layoff notices. Economic demand will decline and we won’t see any mere one year recession, like all the pundits say ‘we foresee 5 quarters of economic decline in the US…’ This time we are talking on the scale of 5 years of economic decline and unemployment getting over 20%. The Great Depression lasted ten years, and the US had well over 25% unemployment. US economic production was halved!

SEE LINK FOR MORE HAPPY TALK

[tclambert]

34. If cash is bad, stocks lousy, gold is tanking, how do you hedge what little money 's left?

Or should I just fill up the bomb shelter with canned goods and those rye crackers that last forever?

[tama]

73. What does USD collapse mean?

Same as collapse of Iceland krona meant, but much worse: No IMF to the rescue (too big to bail out). No more imports from abroad -> No imported oil and gas -> No fuel -> No industrial agriculture -> Famine -> Population correction.

US nuking the world just out of spite somewhere along this process is of course no small chance. At least that's how foreigners see American mentality and that's how much they trust Americans to be human beings.

[Ghost Dog]

77. What you say makes a lot of sense

imo, tama.

And we've all heard drums rolling.

--> Perhaps you ought to post some sort of 'profile' of yourself for our sakes here?

edit:

http://www.youtube.com/watch?v=s3ttWjLAcV4 (Fairport Convention 1970 Sloth Part 1 of 2)
http://www.youtube.com/watch?v=J_0pXDIuyTA (Fairport Convention 1970 Sloth Part 2 of 2)

[Demeter]

28. Try This Link

http://www.informationclearinghouse.info/article21313.htm

[DemReadingDU]

33. workers gulag; Siberia on Lake Michigan

Mike Whitney has a way with words

P.S. Glad you are feeling better

:)

[Demeter]

118. Thank You, Me Too!

[Demeter]

6. Internet fraudsters beat the crunch By Philip Stafford in London

http://www.ft.com/cms/s/0/f2d12464-b9ab-11dd-99dc-0000779fd18c.html



Internet fraud is becoming a “recession-proof economy” with all the sophistication of a legitimate business model, according to a report published on Monday. The industry is worth a potential $7bn, according to Symantec, the world’s largest maker of security software, with stolen bank account information starting at £6.50 ($10) and credit card numbers selling for as little as 7p each. The report, which quantifies the scale of global cybercrime for the first time, calculated the value of the industry on the assumption that all fraudulent credit card limits were reached and bank accounts emptied.

Symantec said goods, services and information were being sent at ever faster speeds round the globe via online forums, hosted by servers whose geographic locations were constantly changing to evade detection. Cybercrime was anecdotally growing “very rapidly”, the company said, in spite of the absence of comparative data from previous years.

“These forums are a genuine marketplace where people are playing different roles of buying and selling,” said Liam O’Murchu, security analyst at Symantec. “It does appear to be apeing real business models. It’s a little bit like when e-business was kicking in. It’s a free market in labour and an international market.”

Symantec monitored servers across the world as the basis for its report and found more than 69,000 fraudsters advertising their services over the past year, sending 44,321,095 messages to underground forums...Symantec found that credit card information was the most advertised category of goods and services, accounting for 31 per cent of the total, with financial accounts the next biggest on 20 per cent.

[ozymandius]

8. Today's Reports

08:30 Chain Deflator-Prel. Q3
Briefing.com 4.2%
Consensus 4.2%
Prior 4.2%

08:30 GDP-Prel. Q3
Briefing.com -0.3%
Consensus -0.5%
Prior -0.3%

10:00 Consumer Confidence Nov
Briefing.com 40.0
Consensus 39.5
Prior 38.0

http://www.briefing.com/Investor/Public/Calendars/EconomicCalendar.htm

[Demeter]

11. Why Would ANYONE Expect Consumer Confidence to Go Up?

Because of the election? Not bloody likely.

[ozymandius]

15. Somebody mis-read the populace.

Sure. The election is over. Obama is, for all intents and purposes, co-president now. Bush has abdicated his office so badly, so clumsily (what did one expect?) that the lies are refuted in advance. How could Dana Perino not know that Citi was about to be rescued when everyone else did? They must literally keep her in a cave under the West Wing.

So the power in Washington has effectively changed hands with a litany of name-dropping for the next cabinet. And yet we've been served another shit sandwich with the Citi bailout.

A thought from yesteryear just popped into my head: what ever happened to the idea that a troubled company would spin-off it profitable sectors and collapse its unprofitable ones?

[SarahB]

13. My prediction (worthless as always): GDP will be very, very bad

That would explain the urgency to "solve" the Citibank crisis and the timing of the announcement of Obama's economic team.

Note: This is Finnfan, logged in under his wife's account again. :-)

[ozymandius]

17. Good morning FinnFan/SarahBelle.

:donut:

Good to see you here so early.

:hi:

[UpInArms]

45. U.S. Q3 GDP down 0.5% vs. down 0.3% prev. est. - and other reports:

01. U.S. Q3 corporate profits fall $14.6 billion
8:30 AM ET, Nov 25, 2008

02. U.S. Q3 corporate profits down 9.0% year-on-year
8:30 AM ET, Nov 25, 2008

03. U.S. Q3 GDP revisions due to weaker consumer spending
8:30 AM ET, Nov 25, 2008

04. U.S. Q3 core PCE price index up rev 2.6% vs 2.9% prev
8:30 AM ET, Nov 25, 2008

05. U.S. Q3 GDP slowest since Q3 2001
8:30 AM ET, Nov 25, 2008

06. U.S. Q3 GDP slightly above -0.6% expected
8:30 AM ET, Nov 25, 2008

07. U.S. Q3 GDP down 0.5% vs. down 0.3% prev. est.
8:30 AM ET, Nov 25, 2008

[UpInArms]

68. Consumers smokin' crack - confidence @ 44.9

19. U.S. November consumer confidence above 39 expected
10:01 AM ET, Nov 25, 2008

20. U.S. November consumer confidence 44.9 vs 38.8 in October
10:01 AM ET, Nov 25, 2008

[Demeter]

85. That's Got to Be a Lie

No way people are feeling exuberance.

[Tansy_Gold]

104. If the survey was taken after 11/5, consider the psychological

boost of the election results.

They're only talking about "confidence," merely an emotion. Not a reality. . . . yet.

[ozymandius]

12. Oil falls below $53 in Asia after rising overnight

SINGAPORE – Oil prices fell below $53 a barrel Tuesday in Asia after surging overnight as investors mulled whether a U.S. government bailout of Citigroup Inc. restores enough confidence to staunch crude's slide since July.

Light, sweet crude for January delivery was down $1.68 to $52.82 a barrel in electronic trading on the New York Mercantile Exchange by late afternoon in Singapore.

The contract overnight rose $4.57 to settle at $54.50 after the Treasury Department announced a rescue of banking giant Citigroup. Fears the sprawling financial firm would collapse sent stock markets plunging and the price of oil to a 3-year low near $49 last week — a third of its peak near $150 a barrel in July.

But some oil market watchers think euphoria over the government lifeline for Citigroup will soon give way to more dismal news about a severe global economic slowdown and trigger a test of the lows that oil hit last week.

....

In other Nymex trading, gasoline futures dropped 1.49 cent to $1.13 a gallon. Heating oil slid 1.94 cents to $1.77 a gallon while natural gas for January delivery fell 1.1 cents to $6.82 per 1,000 cubic feet.

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

[Ghost Dog]

14. GLOBAL MARKETS-Shares fall in Europe as Citi euphoria fades

Tue Nov 25, 2008 3:55am EST LONDON, Nov 25 (Reuters) - European stocks bucked Wall Street and Asia to fall more than 1 percent on Tuesday as euphoria surrounding the U.S. rescue of Citigroup (C.N: Quote, Profile, Research, Stock Buzz) gave way to concerns about sharply deteriorating major economies.

...

The World Bank said China's growth -- once seen as the engine of the world economy -- could slow to 7.5 percent in 2009, its slowest pace of expansion since 1990, due to the intensifying impact of global financial turmoil.

"Given the scale of the rally in risk assets (on Monday) investors are reassessing the situation and are less willing to chase the rally higher," BTM-UFJ currency economist Lee Hardman said. "The underlying conditions are not conducive for further gains...in risk assets, with below-trend growth across the globe and financial markets in a severe state of distress."

The FTSEurofirst 300 index of leading European shares .FTEU3 fell 1.4 percent, after rallying nearly 9 percent on Monday -- its second biggest one-day percentage rise on record.

Shares in Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) fell 36 percent after top global miner BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) walked away from its $58 billion hostile offer for the firm.

A 3.4 percent rise in Asian stocks .MIAPJ0000PUS helped MSCI world equity index .MIWD00000PUS post a 0.4 percent gain. Emerging stocks .MSCIEF rose 2.4 percent.

/... http://www.reuters.com/article/marketsNews/idINLP59397420081125?rpc=44

[Ghost Dog]

18. Nikkei rises, but Citi euphoria seen limited

Tue Nov 25, 2008 1:44am EST TOKYO, Nov 25 (Reuters) - Japan's Nikkei average was up 5.2 percent on Tuesday, its biggest one-day gain in two weeks, but further gains were limited as investors worried how long euphoria over a Citigroup (C.N: Quote, Profile, Research, Stock Buzz) bailout would last. Mizuho Financial Group (8411.T: Quote, Profile, Research, Stock Buzz) and other banks were boosted by the massive Citigroup bailout and subsequent Wall Street rally, but some profit-taking capped gains as the yen crept higher against the dollar.

...

"Though U.S. shares may rise a bit more, these gains are likely to be limited by concern about more bad indicators that will show the poor state of the economy," said Yutaka Miura, senior technical analyst at Shinko Securities. "As for Citi, they just injected funds in October, so this raises the possibility that other places may need more funds, too, even as the economy worsens."

Other market players echoed this, saying that the impact of the Citi news was limited at best for Japan and it was doubtful how long Wall Street's rise -- which has seen the Dow Jones industrial average .DJI post nearly $900 of gains in two trading days -- will last.

"Will the government really go and help every firm that gets into trouble?" said Masayoshi Okamoto. "It seems pretty clear that the United States is heading for deflation, which is likely to hit banks hard. And if the U.S. goes into deflation, so will the world."

...

The benchmark Nikkei gained 413.14 points to 8,323.93 after earlier rising to 8,356.83, while the broader Topix .TOPX rose 3.6 percent to 831.58.

...

Canon (7751.T: Quote, Profile, Research, Stock Buzz) was one of the best performing exporters, rising 7.8 percent to 2,905 yen even after President Tsuneji Uchida told Reuters that the digital camera market may contract next year .

Honda Motor Co (7267.T: Quote, Profile, Research, Stock Buzz) climbed 7.2 percent to 2,090 yen, as investors shrugged off Honda's plan to build fewer cars in Japan, Europe and North America -- a reflection of an increasingly bleak outlook for sales as the global economic crisis discourages big-ticket purchases.

Sumitomo Mitsui Financial Group (8316.T: Quote, Profile, Research, Stock Buzz) gained 11.5 percent to 340,000 yen and Mizuho Financial Group rose 9.2 percent to 247,700 yen. Mitsubishi UFJ Financial Group (8306.T: Quote, Profile, Research, Stock Buzz) gained 2.9 percent to 506 yen.

Trade picked up slightly, with 2.15 billion shares traded on the Tokyo exchange's first section compared to last week's daily average of 2.1 billion.

/... http://www.reuters.com/article/marketsNews/idCAT6911120081125?rpc=44&sp=true

[ozymandius]

21. Maybe it's sinking in that we live in a world with Citi still "too big to fail".

And maybe it's sinking in that Citi will continue the same shitty hostile consumer policies as it always has.

[Ghost Dog]

32. A lot will depend on the degree of classical/imaginative Keynesianism

to be announced by the EU (and EU countries) tomorrow, I reckon.

[Ghost Dog]

52. EU exec to urge short, sharp economy boost - draft

BRUSSELS, Nov 25 (Reuters) - The European Commission will propose on Wednesday a short, sharp boost to the recession-hit European economy including value-added tax cuts and a call for lower ECB interest rates, a draft document showed.

The draft proposal, obtained by Reuters, did not specify the size of the stimulus plan, which Germany said last week could be worth some 1 percent of the European Union's gross domestic product (GDP), or 130 billion euros ($164 billion).

With differences among the bloc's 27 states on how to counter a slowdown after the worst financial crisis since the Great Depression, the document is formulated in such a way as to give them leeway on which exact policies they finally adopt.

"Only through a significant stimulus package can Europe counter the expected downward trend in demand, with its negative knock-on effects on investment and employment," the draft said.

"Most of the economic policy levers, and in particular those which can stimulate consumer demand in the short-term, are in the hands of the member states," it said.

The Commission said the budgetary stimulus had to be timely, targeted and temporary, mix revenue and spending instruments, be accompanied by structural reforms and comply with EU budget rules -- the Stability and Growth Pact.

The text, which will be debated by EU leaders at a summit in December, contained a strong caveat that the deterioration in budget deficits resulting from the stimulus should be repaired as soon as the economy picks up.

/... http://www.reuters.com/article/marketsNews/idINLP7325920081125?rpc=44

[Ghost Dog]

54. UK Stimulus: "Bold, imaginative – and it might just work " (Guardian)

* Will Hutton

This was an almost great economic statement – rising to the seriousness of the situation with boldness and sometimes real imagination. It is a stimulus to the economy in a full year of £20bn, which has been organised to come through in 2009/10 when it is most needed. The centrepiece is a temporary £8.6bn reduction in VAT to 15%. In the 1950s, governments used changes in the then so-called purchase tax on goods and services to regulate spending, and the "Regulator" was a fast and effective means of increasing or decreasing demand.

Although tax credits to the low paid had powerful attractions as a way of stimulating demand, the chancellor has chosen to go no further than making the big £600 increase in personal allowances permanent, while adding another £130. The American example is that in current conditions taxpayers tend to save any income tax giveaways. Hence the cut in VAT to make spending more attractive. I suspect it might work rather better than received opinion thinks, which together with bringing forward £3bn of capital spending into 2009 credibly adds 1% to demand at the moment it is most needed. He is to be congratulated.

But the PBR is only almost great, because the chancellor could have done more to mitigate the inevitable risks and hazards. He has chosen to wait until next spring to introduce measures to restore the flows of mortgage finance – far too late – and he has been far too minimalist in measures to get bank lending going. As it is his economic forecast for 2009 is at the optimistic end of expectations, relying on the effectiveness of his intervention. But if the economy does not respond to his measures as well as he hopes he will find borrowing exceeding his already high forecast of £118bn in 2009/10. As bank lending is at the root of the crisis, I would like to have seen him extend the approach he has taken to small business – guaranteeing loans and working capital through an insurance scheme – more widely deployed.

Those reservations aside, there is much to admire. The rapid response initiative to help people newly unemployed is imaginative; so is the Employment Partnership to make sure that the vacancies that do exist are as quickly filled as possible. It was also vital that he deliver a credible plan to reduce the deficit beyond the peak, and the proposed increase in the top rate of tax and national insurance contributions do that. However, there is £5bn of so-called efficiency savings pencilled in from public spending, and when the markets look at this more closely in the days ahead this will be an area they question. Yet if the plans work he will have slowed down public spending growth, protected capital spending, got back to a balanced budget in 2016 and created a fairer tax system. And if the efficiency savings don't transpire he can always increase VAT, which is much easier than increasing income tax.

/... http://www.guardian.co.uk/commentisfree/2008/nov/24/pre-budget-report-economy1


Just like the 70s - without a 3-day week

* Larry Elliott, economics editor

There's no three-day week and the lights have yet to go out. But in every other way yesterday's pre-budget report (PBR) was a throwback to the 1970s. For a start, we had a chancellor admitting that the country was in an awful - but unexpected - jam. What's more, we had a good old-fashioned remedy for the crisis, oodles more public borrowing to finance a VAT holiday, accelerated public spending and a package of help for small businesses.

Finally, there was a vague echo of old Labour class-war rhetoric, with the commitment to raise the top rate of tax to 45% on those earning more than £150,000. This is less of a risk than it once would have been for the government. Ministers sense, almost certainly correctly, that the public blames City fat cats earning more than £150K a year for the country's current predicament and want them to suffer financially for their reckless speculation.

In truth, Alistair Darling could probably have put it up to 50% without much resistance from a chastened City.

But if the decision to abandon the commitment not to raise the top rate of tax - one of the bedrock beliefs of New Labour - was no gamble, the rest of the PBR most certainly was.

The prime minister and his chancellor are betting the farm on the 2.5 percentage point cut in VAT prompting a splurge in spending that will limit both the depth and the duration of a recession neither of them saw coming.

/... http://www.guardian.co.uk/business/2008/nov/25/pre-budget-report-economy3

/More... http://www.guardian.co.uk/business

[Ghost Dog]

75. WRAPUP 2-Obama to outline cuts to U.S. budget

Tue Nov 25, 2008 11:21am EST CHICAGO, Nov 25 (Reuters) - President-elect Barack Obama will outline steps to trim the federal budget on Tuesday as he simultaneously plans a costly stimulus package to jolt the ailing U.S. economy.

Though he does not take office until Jan. 20, Obama's team of economic advisers are already working out the details of a two-year package to save or create 2.5 million jobs that could cost several hundred million dollars.

That spending, which is expected to push the budget deficit higher, will be offset at least partially by spending cuts elsewhere, Obama said.

"We'll have to scour our federal budget, line-by-line, and make meaningful cuts and sacrifices as well," he said at a news conference on Monday and promised more detail at a Tuesday news conference at noon EST (1700 GMT).

Bush administration officials, meanwhile, continued to extend massive life support efforts to the ailing U.S. financial system.

...

Obama's aides are in contact with Bush administration officials, who said they would work closely with Geithner and other incoming officials on any new rescue plans.

/... http://www.reuters.com/article/marketsNews/idINN2526217420081125?rpc=44

[Demeter]

87. He'd Better Cut BOTH Wars and Whatever They're Spending In Somalia and Latin America First

This has gone quite far enough. And then nationalize Detroit and Citibank.

[Ghost Dog]

98. So, any news on that (those) front(s)?

- for those of us who refuse to use TV?

[tama]

100. Considering

That Obama's team is just bunch of similar criminals that created this FUBAR, that seems unlikely.

Obama is one of them, not one of us. Sad but true.

[TalkingDog]

92. America's "little guys" - Too big to fail?

Evidently not.

[Ghost Dog]

20. European shares briefly turn positive, banks help

Tue Nov 25, 2008 6:04am EST LONDON, Nov 25 (Reuters) - European shares briefly turned positive in morning trade on Tuesday, helped by banking shares that remained in a positive territory.

At 1101 GMT, the FTSEurofirst 300 index of top European shares was down 0.1 percent at 828 points after rising as high as 829.34.

Allied Irish Banks (ALBK.I: Quote, Profile, Research, Stock Buzz), Bank of Ireland (BKIR.L: Quote, Profile, Research, Stock Buzz), Barclays (BARC.L: Quote, Profile, Research, Stock Buzz), Lloyds (LLOY.L: Quote, Profile, Research, Stock Buzz), and UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) were up between 4 and 10.3 percent.

/. http://www.reuters.com/article/marketsNews/idCALP72336720081125?rpc=44

[Ghost Dog]

76. Europe shares end higher on banks, energy stocks

Tue Nov 25, 2008 11:41am EST LONDON, Nov 25 (Reuters) - European shares eked out a gain on Tuesday, as advances in banks and energy stocks offset falls in autos and drugmakers and a slide in Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) after BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) dumped a bid for the miner.

The FTSEurofirst 300 .FTEU3 index of top European shares ended unofficially 0.3 percent higher at 831.25 points, after having traded in a wide range of 812.89 to 848.92.

...

Banks and energy stocks added most points to the index. HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) gained 6 percent and Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz) jumped 11 percent, while BP (BP.L: Quote, Profile, Research, Stock Buzz) gained 1.5 percent and BG Group (BG.L: Quote, Profile, Research, Stock Buzz) rose 4 percent.

Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) plummeted 37 percent after BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) abandoned its bid for the group, while Novartis (NOVN.VX: Quote, Profile, Research, Stock Buzz) lost 4 percent and GlaxoSmithKline (GSK.L: Quote, Profile, Research, Stock Buzz) slipped 3.3 percent ahead of an EU report on Friday expected to criticise major European drugmakers for anti-competitive practices.

/.. http://www.reuters.com/article/marketsNews/idCALP16413620081125?rpc=44

[ozymandius]

19. BHP Abandons $66 Billion Rio Tinto Bid as Commodities Collapse

Nov. 25 (Bloomberg) -- BHP Billiton Ltd. abandoned its year-long pursuit of Rio Tinto Group, blaming the rout in commodities prices and the credit-market squeeze for derailing the biggest hostile offer.

Marius Kloppers, chief executive officer of the world’s largest mining company, said the combination of $40 billion in new debt and regulatory hurdles made the $66 billion bid too risky at a time when the slowing world economy reduced demand for raw materials. Rio plunged as much as 40 percent in London trading, while Melbourne-based BHP shares jumped 21 percent.

When BHP announced the plan to buy Rio, commodity prices were heading to record highs and the Standard & Poor’s 500 Index was approaching its peak. Twelve months and $450 million of shareholder money later, Kloppers is confronting a 50 percent drop in copper prices and a 45 percent decline in oil as the world’s biggest economies face their first simultaneous recessions since World War II.

....

The value of BHP’s offer slumped after peaking at $194 billion on May 19 as commodity prices dropped. Aluminum is heading for its biggest annual drop in 17 years. Contract iron ore prices are forecast to drop in 2009, according to analysts at UBS AG And Goldman Sachs JBWere Pty. Coal is also predicted to decline.

....

‘Good News’????

Credit-default swaps on BHP tumbled 130 basis points to 320, according to Citigroup Inc. prices at 7:45 a.m. in London. Contracts on Rio jumped 50 basis points to 800.

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

[ozymandius]

23. Treasury, Fed Said to Unveil Plan to Bolster Consumer Financing

Nov. 25 (Bloomberg) -- The U.S. Treasury and Federal Reserve will unveil as soon as today a lending program to shore up the consumer-finance market, using money from the government’s $700 billion rescue, two people familiar with the effort said.

The Treasury and the Fed will help fund new loans packaged into securities for sale to investors, the people said. Treasury Secretary Henry Paulson, who scheduled a press conference for 10 a.m. New York time, said two weeks ago that he wants to spur lending for automobile purchases and college education while also reducing the cost of credit-card debt.

Paulson and Fed Chairman Ben S. Bernanke are widening the scope of their rescue efforts after agreeing two days ago to guarantee $306 billion of Citigroup Inc.’s toxic assets. Paulson has spent most of the first half of the government’s Troubled Asset Relief Program aiding Wall Street banks, and pressure is growing in Congress to help average Americans.

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=aIXCu2ptpeCQ

---

It's amazing what can happen when our Congressional representatives attend Bernanke/Paulson hearings wielding torches and pitchforks.

[Demeter]

27. Still No Jobs Programs, Though

Financing is worthless without an income. Also unattainable....

[dixiegrrrrl]

35. Note that Goldman Sachs is to sell the securities

Talk about ability to make money off both sides of a market.
The same GS that is under investigation for ripping off customers, essentially.

And the 'securities" are backed by what, again?

[Demeter]

26. Consumer bankruptcies in October top 100,000

http://www.usatoday.com/money/perfi/2008-11-04-bankruptcies_N.htm

The sagging economy sparked 106,266 consumer bankruptcy filings in October, the first time monthly filings topped 100,000 since the bankruptcy law changed in 2005, the American Bankruptcy Institute said Tuesday.

During the first year after the new law took effect, personal bankruptcy filings plummeted dramatically, and since then, have risen gradually. In October, though, filings jumped 40% over the same month in 2007.

For the year, bankruptcy filings are expected to exceed 1 million.

"This underscores that the underlying economic problems of consumers who are facing high debts, flat incomes and now declining home values are a very powerful force that pushes people over the edge," says Samuel Gerdano, ABI executive director.

The new law had two goals — reducing filings overall and encouraging more consumers to file under Chapter 13, which requires debtors to repay creditors using a schedule established by the courts. Chapter 7 bankruptcy eliminates most debts. The new law also requires debtors to undergo credit counseling before they can seek bankruptcy court protection. Until recently, the law seemed to accomplish those goals. Now, filings are not only rising rapidly, they're reverting to the traditionally higher rate for Chapter 7 bankruptcy filings, Gerdano says.

Now that home values are falling, many debt-laden consumers have few options. They can no longer rely on home-equity loans, for example.

[tclambert]

36. Bankrupt consumers bailed out: 0

[bain_sidhe]

106. "encouraging" !?!?!

"encouraging more consumers to file under Chapter 13" is bullshit weasel-speak. It REQUIRED people (I refuse to reduce human beings to the only function valued by our dysfunctional capitalism) to file chapter 13 if their income for the past year was at or above the median for their state (somewhere between 20-40,000. Even if their bills (far more often due to "consuming" life-saving medical services than "consuming" products, at any rate) were in the hundreds of thousands of dollars. Even if they lost their job six months ago, but their income for the six months before that was above the median. Even if they were divorced in the last year, and their "income" was based on the pay of both people.

"Encouraging," my lily-white enraged ass!

[ozymandius]

29. A glimpse into the vapid thought process of Citi executives

Citibank Like S&P assumed house prices can't go down

Eric Dash and Julie Creswell who argue that Citibank took insane risks holding CDOs on its books, because of a failure of the fixed incomes risk management team, reckless 'short termism' and two amazing mistakes. The two alleged mistakes are that they trusted the ratings agencies and that they assumed that the national average house price would certainly not decline. These are actually similar mistakes as at least one rating agency, S&P, making the same insane assumption about house prices.

They write:

when examiners from the Securities and Exchange Commission began scrutinizing Citigroup’s subprime mortgage holdings after Bear Stearns’s problems surfaced, the bank told them that the probability of those mortgages defaulting was so tiny that they excluded them from their risk analysis, according to a person briefed on the discussion who would speak only without being named.

Later that summer, when the credit markets began seizing up and values of various C.D.O.’s began to plummet, Mr. Maheras, Mr. Barker and Mr. Bushnell participated in a meeting to review Citigroup’s exposure.

The slice of mortgage-related securities held by Citigroup was “viewed by the rating agencies to have an extremely low probability of default (less than .01%),” according to Citigroup slides used at the meeting and reviewed by The New York Times.

.....

To make matters worse, Citigroup’s risk models never accounted for the possibility of a national housing downturn, this person said

This is amazing. It's not as if no one with an Op-Ed column in the New York Times was discussing the possibility of a national housing downturn. I can't believe that this was an honest oversight. The anonymous source doesn't say either "“I just think senior managers got addicted to the revenues and arrogant about the risks they were running. As long as you could grow revenues, you could keep your bonus growing.”

http://angrybear.blogspot.com/2008/11/citibank-like-s-assumed-house-prices.html

[dixiegrrrrl]

39. Denial is a powerful mechanism.

It's the "rarefied air" syndrome. Seems to be real.
One gets used to traveling via private jet, hanging around people who mirror the same thoughts, attitudes, living standards. After awhile it becomes easy to forget there is any other world out there, any natural laws that apply to your own inner circle.
Politicians and bankers suffer from it, so do some doctors, surgeons at one time being the most famous example.
Ego, money, and isolation from the real world..we saw it all during the campaign.
We heard it in jaw dropping remarks from CEOs at Congressional hearings.

and of course there is that pesky history, which displays the same attitude, the same bubbles, the same shock that a bubbly could burst.

I think it's real. The Enron guys did not think they could fall, either. Couple good books about that, which showed the bizarre thinking.
AKA..believing your own BS.

[Tansy_Gold]

110. I'm not sure how valid this is, but I found it quite, um, interesting

http://www.orange-papers.org/orange-cult_q4.html

[Demeter]

88. Furthermore, New England In the 80's Had a Massive Deflation in Housing

when Digital Equipment Corp. bit the dust, the war economy ended, and RT 128 suddenly didn't have rush hour any more.

[Dr.Phool]

37. ArcelorMittal may lay off 2,400 in Indiana

I posted this late last night, but I think everyone was gone home by then.


______________________________________________________________
ArcelorMittal may lay off 2,400 in Indiana
Posted by Sarah Hollander/Plain Dealer Reporter November 24, 2008 12:17PM
Categories: Breaking News, Economy, Manufacturing, Real Time News

ArcelorMittal and United Steelworkers Local 979 said the partial-pay layoffs that began at its Cleveland operations earlier this month are still voluntary, although the world's largest steelmaker said today that it will lay off up to 2,444 workers at its Burns Harbor, Ind., plant in January.

"Potential workforce reductions are a direct result of the extraordinary economic environment we are facing and the company hopes to return workers to their jobs as market conditions warrant," ArcelorMittal said in a written statement.

ArcelorMittal has reduced North American production by 40 percent, including idling both of Cleveland's blast furnaces. The USW represents about 1,450 workers at the Cleveland mill.

Read more: http://blog.cleveland.com/business/2008/11/arcelormitta...



_____________________________________________________________
Hey, but the stock market is up! Citi owns the Treasury!

Who needs jobs anyway?

(More at another link.)
http://www.cleveland.com/plaindealer/stories/index.ssf?...

Steel shipments down 23% in October from a year ago
Thursday, November 20, 2008
Sarah Hollander
Plain Dealer Reporter

Steel shipments from U.S. service centers plummeted in October, another trickle-down casualty of the limping economy.

Shipments dropped nearly 23 percent -- 3.6 million tons compared to 4.7 million for the same time last year, according to a report Wednesday from the Metals Service Center Institute.

Local service centers said their inventories should carry them through a decline in steel production for a while, especially since orders are down. Eventually, however, steel pricing could become a concern.

(snip)

[UpInArms]

40. dollar watch

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

Last trade 86.223 Change +0.513 (+0.66%)

US Dollar, Japanese Yen Falter as Citigroup Rescue Boosts Demand for Carry Trades

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/US_Dollar__Japanese_Yen_Falter_1227562553253.html

The US dollar and Japanese yen – the biggest beneficiaries of flight-to-quality and deleveraging – both tumbled on news that the Treasury, Federal Reserve and Federal Deposit Insurance Corp. pledged up to $306 billion to shield Citigroup from losses related to toxic assets, though the firm must absorb the first $37 billion to $40 billion in losses, while also agreeing to inject an additional $20 billion in capital. The news suggests that the Treasury dropped provisions to buy troubled assets under the Troubled Asset Relief Program (TARP) on November 12 because it would simply be too expensive given the budget constraints approved by Congress. It will be interesting to see if other banks end up requiring similar aid, and if the US government will comply.

Looking ahead to Tuesday, in case the first round of US GDP readings for the third quarter weren’t bad enough for you, the second reading is anticipated to be revised even lower at 8:30 ET. Indeed, annualized GDP is forecasted to be altered to -0.5 percent from -0.3 percent, while personal consumption is expected to be corrected to -3.2 percent from -3.1 percent. However, it will likely take a surprisingly low result to illicit any sort of reaction from the markets, as traders are already well aware that economic conditions in the US remain dismal. Later in the morning at 10:00 ET, the Conference Board’s consumer confidence index is forecasted to hold near the record low of 38.0 reached just last month, though given the gloomy outlook for the economy, there may be downside risks. The key here will be to gauge the impact of the news on risk trends, as disappointing data could trigger flight-to-quality and thus, US dollar and Japanese yen buying. On the flip side, readings in line with expectations shouldn’t have a huge impact and could allow the surge in carry trades to continue.

...more...

EUR/USD: Trading U.S. Durable Goods Orders

http://www.dailyfx.com/story/trading_reports/trading_news_reports/EUR_USD__Trading_U_S__Durable_Goods_1227615557041.html

The growth outlook for the U.S. is expected to weaken further as economists forecast durable goods orders to fall 3.0% in October. Tightening credit conditions paired with falling home prices have certainly dragged on the private-sector as personal spending dropped 3.1% in the third quarter for the first time since 1991.



Trading the News: US Durable Goods Orders

What’s Expected
Time of release: 11/26/2008 13:30 GMT, 08:30 EST
Primary Pair Impact : EURUSD
Expected: -3.0%
Previous: 0.9%



<snip>

The growth outlook for the U.S. is expected to weaken further as economists forecast durable goods orders to fall 3.0% in October. Tightening credit conditions paired with falling home prices have certainly dragged on the private-sector as personal spending dropped 3.1% in the third quarter for the first time since 1991. In addition, retail spending slipped to a record low of -2.8% in October, followed by a 0.9% decline in chain-store sales, and conditions may only get worse as the unemployment rate reached a 14 year high of 6.5% during the same period. Fading employment opportunities has clearly taken a toll on demands as factory orders fell another 2.5% following a 4.3% decline in August, while domestic vehicle sales plunged to 7.9M from 9.6M in September. Deteriorating fundamentals have certainly stoked fears that the world’s largest economy could face a deep and prolonged recession which could last well into the next year, and may lead policymakers to increase their efforts over the coming months in order to stave off further downturns in the economy. President-elect Barack Obama promised to deliver fiscal stimulus package during a speech yesterday as he expects conditions to get worse, and noted that it will be imperative to restore confidence in the financial market. Mr. Obama went onto say that the unprecedented downturn in the financial market requires ‘extraordinary policy responses,’ which suggests that he will work closely with future Treasury Secretary Timothy Geithner to carry out these fiscal objectives. Meanwhile, Fed Fund Futures are showing that market participants are increasing their bets for a 50bp rate cut as they price-in an 88% chance for the FOMC to lower the benchmark interest rate to 0.50% however, a Bloomberg News survey shows a median forecast for a 25bp cut to 0.75%, which suggests that the U.S. dollar may face increased selling pressures over the coming months as the Fed continues to lower borrowing costs. Nevertheless, as risk trends continues to drive price action in the currency market, the greenback may continue to benefit from its safe haven status as investors curb their appetite for risk.

With the given event risk at hand, we would need to see a considerable improvement from the forecast to go long on the dollar. Therefore, an increase of at least 0.1% or more would certainly set the stage for a short EURUSD trade. Following the release, we will look for a red, five-minute candle to confirm an entry on two lots of the euro-dollar. Our initial stop will be placed at the nearby swing high (or reasonable distance), and this level of risk will determine the target for the first lot. Our second target will be based purely on discretion, and in order to preserve our profits, we will move the stop on the second lot to breakeven once the first trade reaches its target.

On the other hand, fading employment opportunities paired with the lack of stability in the credit market is likely to curb demands, and a fall in durable goods would certainly stoke increased selling pressures for the greenback. As a result, a decline of 3.0% or greater in orders would favor a bearish dollar trade (long EURUSD), and we will follow the same strategy as the bullish dollar trade listed above, just in reverse.
...more...

[Ghost Dog]

51. Euro extends gains vs dollar, hits three-week highs

Tue Nov 25, 2008 9:31am EST NEW YORK,Nov 25 (Reuters) - The euro accelerated gains against the dollar on Tuesday, hitting three-week highs, buoyed by the rise in U.S. stock futures after the Federal Reserve unveiled plans to boost consumer credit.

The euro rose as high as $1.3080 <EUR=>, the highest since Nov 5, according to Reuters data. It last traded at $1.3053, up more than 1 percent.

/.. http://www.reuters.com/article/marketsNews/idINN2526238920081125?rpc=44

______
also:

[MattSh]

42. Saving Citi May Create More Fear.

One bailout was not enough for Citigroup. And it may not be enough for other big banks.

While Citigroup’s second multibillion-dollar rescue from Washington hit Wall Street like a shot of adrenaline on Monday, many analysts worried that the jolt would soon wear off. Citigroup has been stabilized, but the outlook for the financial industry as a whole is bleak.

With the red ink deepening, other banks may eventually turn to the government to soak up some of their losses. Taxpayers could end up guaranteeing hundreds of billions of dollars of banks’ toxic assets. Indeed, Treasury Secretary Henry M. Paulson Jr. is expected to announce a new plan on Tuesday to bolster the consumer-finance market.

<snip>

In the short term, the latest effort to steady Citigroup has removed the risk that a sudden failure of the giant bank would send losses cascading through the financial industry.

But longer term, the new bailout could haunt regulators and taxpayers. The move ultimately may encourage banks to take more risks in the belief that the government will step in if they run into trouble.

With a recession looming, if not here already, banks big and small are bracing for more loans to sour, particularly those related to commercial real estate, autos and credit cards. Many are making fewer loans, even though the industry has received nearly $300 billion from the government.

Before long, anxious investors may start wondering which banks will be vulnerable next. If confidence fades, other big lenders will probably seek deals like Citigroup’s, in which the government has pledged to pick up potentially $290 billion in additional losses. Regulators drafted the plan with an eye to using it as a template for future bailouts.

There are other worries for Citigroup’s big rivals. Almost overnight, Citigroup went from being the sick man of the industry to an institution with an edge over its competitors. The government is guaranteeing $250 billion of risky assets and pumping an additional $20 billion into the bank.

With the government behind it, Citigroup may now be able to borrow money in the capital markets at lower interest rates than its peers.

“Citi has a decided advantage over them because of the loss-sharing agreement,” said John Kanas, the former chief executive of North Fork Bank of Long Island. While banks may hold out for now, it may be only a matter of time before they too line up, several analysts said.

A whole lot more bad news here... http://www.nytimes.com/2008/11/25/business/25citi.html?hp

[UpInArms]

43. Fed to loop kids into more debt - no promise of jobs ever

01. Fed to support ABS collateralized by student loans
8:19 AM ET, Nov 25, 2008

02. Fed to support ABS collateralized by auto loans, SBA loans
8:19 AM ET, Nov 25, 2008

03. Fed to support issuance of some asset-backed securities
8:18 AM ET, Nov 25, 2008

04. Fed creates Term Asset-Backed Securities Loan Facility
8:16 AM ET, Nov 25, 2008

[MilesColtrane]

46. An army of Wal Mart greeters?

*shudder*

That's like a zombie movie...the stuff of nightmares.

[DemReadingDU]

47. "Watching the pot come to a boil": One, Two, Three ... Infinity

From John J. Xenakis web log, Generational Dynamics,
http://www.generationaldynamics.com/ww2010.htm

11/25/08 Watching the world spin out of control.

Anyone who was interested in mathematics in the 1950s and 1960s has probably read George Gamow's book, One, Two, Three ... Infinity. That's the title that's been popping into my mind the last few days, watching the process that's going on.
.
.
Let's review, once again, the reasons why none of these bailout measures will do any good at all.

Thanks to a lethal combination of stupid Boomers and destructive Gen-Xers (see link below), both morally challenged, there were huge credit and real estate bubbles, creating hundreds of trillions of dollars of new investments and new debt.

The new investments turn out to be worthless, but the new debt remains, causing the massive bubble to leak a trillion or so dollars every week. We've been in a massive deflationary spiral (see link below) for well over a year, and it's accelerating.

That's why the amount of money needed for the bailout is increasing so rapidly. It was a $700 billion bailout in October, and now it's a $7.7 trillion bailout. Soon it will be a $70 trillion bailout. One, two, three ... infinity.

People have been pointing out some claims by Ben Bernanke in a 2002 speech on avoiding deflation. In that speech, Bernanke congratulated steps taken by President Franklin Roosevelt in 1933 and 1934. According to Bernanke, the same steps can be taken now to fix the credit crisis.

This is just another example of why this great brain trust in Washington has no clue about what's going on. Following the bubble of the 1920s, the bubble had been leaking since 1929. By 1934, the deflationary spiral was almost completely spent, and by that time the economy would have approved whether or not the President did anything. This is not particularly difficult to understand, except by professional economists, who are incapable of understanding anything except their computer models, and certainly not anything related to generational theory.

There will be more bailouts attempted, but they will fail. Everything will fail. This is a generational catastrophe, and cannot be stopped any more than a ten mile high tsunami can be stopped.

It's time for people to realize that they should be preparing themselves and their families for the worst, instead of just praying for a huge miracle on January 20. Obama may be able to walk on water, but even he can't stop the huge generational catastrophe that's coming.

There's far worse to come. Expect a huge generational stock market panic and crash, including the imploding of tens or hundreds of trillions of dollars of CDSs and other credit derivatives, and the collapse of 401Ks, hedge funds, and money market funds. Expect many, many millions more foreclosures, bankruptcies, and job losses. We are headed for a financial disaster of massive proportions, and it's time for people to stop lying to themselves and others about it.

more...
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e081125#e081125


Lots more to read from earlier postings of Generational Dynamics

11/21/07 stupid Boomers and destructive Gen-Xers
be sure to read to the end...there are several quotes by people from 1927-1933
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e071121#e071121

10/27/08 a massive deflationary spiral
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e081027#e081027


edit for spelling.

[Festivito]

48. Debt: 11/21/2008 10,655,468,648,978.00 (UP 11,419,055.70) (Tiny day.)

(FICA up, Public down. A teeny-tiny change. I think they already borrowed the money and put it into the Fed. Just a guess, but we'd be paying the interest.)

= Held by the Public + Intragovernmental(FICA)
= 6,393,775,797,295.81 + 4,261,692,851,682.26
DOWN 151,096,322.01 + UP 162,515,377.74
(NOTE: Excel 2007 cannot handle ten-trillion plus to the penny. It zeroes the penny.)

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: 3 or 4 dollars per billion in a 300-Million person America.
If every American, man, woman and child puts in $3.33 each THAT'S 1B$.
A family of three: Mom, Dad, Child: THEIR SHARE IS TEN BUCKS in a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is a federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)
(I hate those end to end dollars to the moon and back, or years to spend $100/second. Just say'n)
If you read this and have a suggestion or comment, good or bad, I'd love to see it.

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 8,177,283,271.60.
The average for the last 30 days would be 6,269,250,508.23.
The average for the last 31 days would be 6,067,016,620.87.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 36 reports in 52 days of FY2009 averaging 17.52B$ per report, 12.13B$/day.

PROJECTION:
GWB** must relinquish the presidency in 60 days.
By that time the debt could be between 10.7 and 11.4T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
11/21/2008 10,655,468,648,978.00 GWB (UP 4,927,272,852,796.43 so far since Bush took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 630,743,752,065.60 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
10/31/2008 +045,215,290,348.09 ------------**********
11/03/2008 -000,572,269,490.77 --- Mon
11/04/2008 +000,314,469,904.16 ------------********
11/05/2008 -000,077,530,396.02 ----
11/06/2008 +056,540,493,221.63 ------------**********
11/07/2008 -000,129,624,570.02 ---
11/10/2008 -000,178,876,517.33 --- Mon
11/12/2008 +000,116,562,137.90 ------------********
11/13/2008 -037,830,308,231.82 -
11/14/2008 +039,714,906,312.49 ------------**********
11/17/2008 -001,168,758,314.18 -- Mon
11/18/2008 +035,027,406,490.17 ------------**********
11/19/2008 -000,433,628,717.22 ---
11/20/2008 -000,189,695,810.14 ---
11/21/2008 -000,151,096,322.01 ---

136,197,340,044.93 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $990,836,845,718.93 in last 64 days.
That's 991B$ in 64 days.
More than any year ever, except last year, and it's 97% of that highest year ever only in 64 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 64 DAYS NOT 365.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

[Festivito]

112. Debt: 11/24/2008 10,654,259,430,730.10 (DOWN 1,209,218,247.90) (Tiny drop.)

(FICA fluctuates. Public debt down a tiny amount again. Typical for Mondays.)

= Held by the Public + Intragovernmental(FICA)
= 6,393,688,876,791.61 + 4,260,570,553,938.56
DOWN 86,920,504.20 + DOWN 1,122,297,743.70
(NOTE: Excel 2007 cannot handle ten-trillion plus to the penny. It zeroes the penny.)

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: 3 or 4 dollars per billion in a 300-Million person America.
If every American, man, woman and child puts in $3.33 each THAT'S 1B$.
A family of three: Mom, Dad, Child: THEIR SHARE IS TEN BUCKS in a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is a federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)
(I hate those end to end dollars to the moon and back, or years to spend $100/second. Just say'n)
If you read this and have a suggestion or comment, good or bad, I'd love to see it.

ANALYSIS:
There were 21 reports in the last 30 to 31 days.
The average for the last 21 reports is 6,204,955,946.36.
The average for the last 30 days would be 4,343,469,162.45.
The average for the last 31 days would be 4,203,357,253.98.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 37 reports in 55 days of FY2009 averaging 17.01B$ per report, 11.45B$/day.

PROJECTION:
GWB** must relinquish the presidency in 57 days.
By that time the debt could be between 10.7 and 11.3T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
11/24/2008 10,654,259,430,730.10 GWB (UP 4,926,063,634,548.53 so far since Bush took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 629,534,533,817.70 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
11/03/2008 -000,572,269,490.77 --- Mon
11/04/2008 +000,314,469,904.16 ------------********
11/05/2008 -000,077,530,396.02 ----
11/06/2008 +056,540,493,221.63 ------------**********
11/07/2008 -000,129,624,570.02 ---
11/10/2008 -000,178,876,517.33 --- Mon
11/12/2008 +000,116,562,137.90 ------------********
11/13/2008 -037,830,308,231.82 -
11/14/2008 +039,714,906,312.49 ------------**********
11/17/2008 -001,168,758,314.18 -- Mon
11/18/2008 +035,027,406,490.17 ------------**********
11/19/2008 -000,433,628,717.22 ---
11/20/2008 -000,189,695,810.14 ---
11/21/2008 -000,151,096,322.01 ---
11/24/2008 -000,086,920,504.20 ---- Mon

90,895,129,192.64 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $989,627,627,471.03 in last 67 days.
That's 990B$ in 67 days.
More than any year ever, except last year, and it's 97% of that highest year ever only in 67 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 67 DAYS NOT 365.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) YESTERDAY'S POST LINK:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3617309&mesg_id=3617453

[DemReadingDU]

53. Bailout Pledges Hit $7.7 Trillion

11/25/08
Here is a Breakdown of the Bailout Rescue Efforts. Note: the tables below do not reflect another $300 billion for Citigroup. Shedlock's link at bottom.


The Fed Part 1





The Fed Part 2




The Treasury




The FDIC




The FHA





Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com/2008/11/bailout-pledges-hit-77-trillion.html
http://www.bloomberg.com/apps/news?pid=20601110&sid=aDqw8_eMzrhU

[Ghost Dog]

55. FACTBOX-What is deflation and why is it feared?

...snip...

* WHY IS IT A PROBLEM?

-- As Japan found in the late 1990s and early 2000s, deflation is hard to shake off because it is self-reinforcing. Put simply, unless it is stopped early, deflation can breed deflation, leading to what is known as a deflationary spiral.

-- When an economy has fallen into deflation, demand from businesses and consumers to buy products dries up because they expect to pay less later as prices fall. But as producers struggle to sell and go bust, unemployment rises, reducing demand further. That causes deflation to become more pronounced.

-- As prices fall, the value of each unit of money increases. This makes it more expensive to service existing debts. This is as true of governments, who have borrowed trillions of dollars globally to prop up the financial sector, as it is for consumers.

-- As debt becomes more expensive to pay off, the risk of default and bankruptcy rises too, making banks more wary of lending. This reduces demand and further exacerbates the deflationary problem.

HOW HAS IT BEEN TACKLED IN THE PAST?

-- Tax cuts to boost demand from consumers and businesses

-- Lowering central bank interest rates to encourage economic activity

-- Printing more currency to boost money supply

-- Capital injections into the banking system

-- Increase government spending on projects that boost the return on private investment

/Continues... http://www.reuters.com/article/marketsNews/idINLC18923020081125?rpc=44&sp=true

[tama]

65. Much good in deflation

Less demand and less consumption is good for the planet.

[Ghost Dog]

71. Absolutely necessary, yes.

Needs to be associated with much improved education, redistribution and environmentally-sound infrastructure initiatives.

[DemReadingDU]

79. true, but

If a person has no job, they have no income (and very few people have any savings nowadays). How does a family survive? Barter system?

[Ghost Dog]

80. Work, somehow, obviously;

self-sufficient, barter or otherwise black market: of course. Or 'eat the rich'?

Edit: This is going to be so much more extreme (suffering) in US than in Europe or hopefully elsewhere...

The poorest of the poor may not even notice. Those who were aspiring... will have, some, patience.

[DemReadingDU]

89. suffering, that is what worries me

Many people now live paycheck-to-paycheck, and have no savings. Every day, there are more and more layoffs. If there are fewer jobs, and no savings, I see civil unrest. If unable to get a job, people stealing to get food to eat.
And we in the U.S. hardly have any manufacturing - shoes, clothes, sheets, towels, etc., these are imported. Trade is slowing down and eventually our stores will have empty shelves. More civil unrest.

I keep seeing pictures of people living in the 30's during the depression, and I see a bleak future.

[Ghost Dog]

94. I foresee Mr. Obama working with

(hopefully relatively human, decent) US Generals, with moderate international support, applying military tactics to keep the kettle, while simmering, from not boiling over.

On the other hand, there are the two possible extremes: on the left hand: Revolution (which may not, in the mid-to-long term, be such a bad thing) :) but would meanwhile involve much chaos; on the right hand: the Nazi (attempted) solution -- Don't go there.

Suffering, for people in the USA, seems to be a given, now :( .

[tama]

95. Empty shelves

That happened in Argentina collapse. Supermarkets looted empty.

After that, I guess, what happened in Germany during the hyperinflation. People leaving towns in bands to scavenge the countryside for edibles.

Soviet collapse was not that bad. People were used to empty shelves and money not being worth much if anything in everyday life. People kept working for no pay and ate cabbages they raised in their little gardens.

[Ghost Dog]

102. Soviet collapse... People...

(while meanwhile looking after themselves) knowing some kind of 'System' would return. Because otherwise... would be very hard.

[fedsron2us]

108. Time to bring those old late Soviet era jokes out of retirement

What is 300 foot long and eats cabbage ?

A meat queue in <........> (insert city, town or country of your choice)

[tama]

82. Can be problematic, yes

And I have no good answers. Nobody has. I can only tell what I'm doing. Changing careers, studying to become a professional gardener, hoping to move to an "ecovillage" (or start a new one) in few years. Not for personal survival, it just feels like the right thing to do, at least for me.

[DemReadingDU]

91. sounds like a good plan

I added a few links in another thread
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4531464

[Ghost Dog]

93. Feels like a good plan to me, too.

I'm working on helping this island here develop ecologically, and in terms of mutual social economy/aid.

(click to see).

http://www.youtube.com/watch?v=mFuxq_J1VuA&feature=related (Pentangle: Hunting Song).

(Ah, the Celts). Where are you? How old are you? What have you learned? Care to tell?

BTW. Please let me remind you all of this: http://www.guardian.co.uk/artanddesign/2008/sep/06/design.coldwar (Frances Stonor Saunders: Cold War at the V&A - Guardian, September 6 2008).

[tama]

97. Sure

In Finland, 40+. What have I learned? Many things, don't know if anything of real importance. Learning to learn could be good.

[Ghost Dog]

99. Cool, then.

:) :hi:

Let us learn from the likes of you.

[antigop]

58. Bailout could make Citi more attractive acquisition target

http://financialweek.com/apps/pbcs.dll/article?AID=/20081124/REG/811249970/1036

Buying beleaguered Citigroup could boost profits at several of the bank’s rivals—but numerous obstacles make such a deal difficult to pull off.

In an agreement reached over the weekend, the Treasury Department agreed to guarantee losses on more than $300 billion worth of Citi’s toxic assets and inject $20 billion in capital. In exchange, the government will receive $7.8 billion in preferred shares and warrants to buy enough common stock to make it the company’s largest shareholder. The bailout seemed to reassure skittish investors, who had punished Citi’s stock price, pushing it down 88% this year through Nov. 21.

But it didn’t end speculation about a possible sale of Citi or divestiture of some of its units.

Goldman Sachs and Morgan Stanley have been on the prowl for bank deposits ever since they converted from investment houses to bank holding companies in October. Those two rivals could be a particularly good fit with Citi, CreditSights analysts wrote in a note to clients on Saturday. Citi boasted $780.3 billion in deposits as of Sept. 30, according to a supplement to its third-quarter results.

“A potential acquisition of Citigroup would be significantly accretive to Goldman and Morgan Stanley’s earnings, as the potential buyer would be acquiring a significant future earnings stream for a relatively low price,” the analysts wrote.

So is this all a setup for Paulson's cronies at Goldman Sachs to take over Citi?

[Dr.Phool]

64. Blinged Out Paulson Family Raises Questions

Treasury Secretary Hank Paulson and his family have drawn considerable negative attention recently for making a number of conspicuous purchases, all of which were made after Congress approved its "no strings attached," 700 billion dollar bailout of Wall Street last month.

Mr. Paulson first raised eyebrows in his Georgetown neighborhood when, two days after the bailout was approved, he was seen walking down M Street with his three French poodles, all of whom were wearing gold plated collars with tags that said 'Look What The Taxpayers Bought Me.' Erik Baiers, an attorney who lives two doors down from the Paulsons, confronted the secretary and demanded to know if his tax money had been used to purchase the dog collars. According to Mr. Baiers, the secretary clutched his genitals, dismissed Mr. Baiers with an expletive and then cleaned up after his dogs with a diamond studded pooper scooper.

Toby Paulson, the secretary's 17 year-old son, is now chauffeured back and forth to the Sidwell Friends School in a white Hummer limousine with a license plate that reads "SUCKERS." Classmates say the secretary's son alternates between wearing a mahogany mink shawl and a snakeskin jacket adorned with sapphires and talking P-Diddy figurines. Tom Breen, Mr. Paulson's trigonometry teacher, says that on two occasions the secretary's son has shown up to class wearing a fish tank necklace filled with with hundred dollar bills and Beluga caviar. "Toby used to be a very low-profile kid," said Mr. Breen. "But ever since the bailout he's been dressing like some kind of rapper, talking about champagne and calling everybody 'bitch.'"

According to sources at Morton & Hannay, a Manhattan based architectural concern, the secretary's wife, Gloria Paulson, has asked the boutique firm to design a 100-story tower of apartments to be erected in the shape of an enormous middle finger. The roof would include a $ shaped swimming pool, velvet green cabanas and a fountain sculpture of Mr. Paulson roundhouse kicking a Teamster . The unprecedented project would cost an estimated 5 billion dollars and, according to sources, would be known as "The Fuck You Tower." Sources also say that Mrs. Paulson and her husband will use bailout money to purchase the Statue of Liberty, tear it down and then build the "The Fuck You Tower" in its place. When a reporter from Open Salon reached Gloria Paulson by phone and inquired about the 5 billion dollar project, she laughed, took a long drag of her cigarette and then asked, "How would you like a Fuck You Tower shoved straight up your ass?"

In addition to working on "The Fuck You Tower," Mrs. Paulson has been planning her husband's 66th birthday party. According to sources within the Treasury Department, Mrs. Paulson has already arranged to rent the trading floor of the New York Stock Exchange. The guest list, which is made up entirely of Wall Street C.E.O's, includes Lloyd Blankfein of Goldman Sachs, Ken Lewis of Bank of America and Vikram Pandit of Citigroup (it has not yet been decided if the heads of Ford, Chrysler and General Motors will be invited). In addition to performances by Jay-Z, David Copperfield and Billy Squier, every guest will be provided with a "Main Street" mannequin, each one resembling an average, working-class American. The mannequin will be bent over with its hands wrapped around its ankles and each guest will be given free reign to do whatever he wants with it.

http://open.salon.com/content.php?cid=46614&source=newsletter


Somehow, it just doesn't sound so far fetched.

[Ghost Dog]

72. Heh. Why stop there? Why not build that tower (with slave-labor) on Mars?

Or, better, on some incredibly mineral-rich asteroid that's due to collide with planet Earth in the coming decades...

:nuke:

[Zenlitened]

69. Soooo.... almost all the numbers reported last month...

... has now been revised downward?

Q3 GDP... October consumer confidence... Q3 consumer spending... Q3 durable goods purchases... Q3 exports (the 'bright spot' in the economy, remember?)... Q3 business spending... and a few more gauges, to boot.

http://online.wsj.com/article/SB122761923606056345.html?mod=googlenews_wsj

And I'm supposed to put stock in (!) the numbers announced today... um, why? :shrug:

[TrogL]

74. Loonie Watch

Highlights

Current:

Loonie: Toronto Stock Exchange:

30-day and 90-day vs.greenback:



30-day vs. Euro, Yen, UK Pound and Swiss Franc




Currency Comparison: http://members.shaw.ca/trogl/looniewatch.html

Detailed analysis: http://quotes.ino.com/exchanges/?r=CME_CD

Up-to-the-minute graph: http://quotes.ino.com/chart/?s=CME_CD.Y%24%24&v=s&w=5&t=l&a=1

Historical values http://www.x-rates.com/d/USD/CAD/data30.html

2008-10-14 Tuesday, October 14 0.862143 USD
2008-10-15 Wednesday, October 15 0.84717 USD
2008-10-16 Thursday, October 16 0.83661 USD
2008-10-17 Friday, October 17 0.846024 USD
2008-10-20 Monday, October 20 0.834934 USD
2008-10-21 Tuesday, October 21 0.819135 USD
2008-10-22 Wednesday, October 22 0.800256 USD
2008-10-23 Thursday, October 23 0.795355 USD
2008-10-24 Friday, October 24 0.785238 USD
2008-10-27 Monday, October 27 0.773096 USD
2008-10-28 Tuesday, October 28 0.772678 USD
2008-10-29 Wednesday, October 29 0.812876 USD
2008-10-30 Thursday, October 30 0.817728 USD
2008-10-31 Friday, October 31 0.817728 USD
2008-11-03 Monday, November 3 0.842744 USD
2008-11-04 Tuesday, November 4 0.869414 USD
2008-11-05 Wednesday, November 5 0.862813 USD
2008-11-06 Thursday, November 6 0.84631 USD
2008-11-07 Friday, November 7 0.845309 USD
2008-11-10 Monday, November 10 0.83696 USD
2008-11-11 Tuesday, November 11 0.83696 USD
2008-11-12 Wednesday, November 12 0.813273 USD
2008-11-13 Thursday, November 13 0.812282 USD
2008-11-14 Friday, November 14 0.816927 USD
2008-11-17 Monday, November 17 0.8188 USD
2008-11-18 Tuesday, November 18 0.817194 USD
2008-11-19 Wednesday, November 19 0.808407 USD
2008-11-20 Thursday, November 20 0.77821 USD
2008-11-21 Friday, November 21 0.778271 USD
2008-11-24 Monday, November 24 0.816593 USD

Current values

http://quotes.ino.com/exchanges/?r=CME_CD)

Market            Open   High    Low   Last  Change    Pct Time
CD.Y$$ Cash     0.8038 0.8197 0.8038 0.8185 +0.0104 +1.29% 12:01 
CD.Z08 Dec 2008 0.7900 0.8150 0.7900 0.8082 +0.0313 +3.85% set 15:12 
CD.H09 Mar 2009 0.8202 0.8215 0.8202 0.8202 +0.0109 +1.36% 09:38 
CD.M09 Jun 2009 0.7805 0.7806        0.8099 +0.0318 +3.93% set 15:12 
CD.U09 Sep 2009 0.9350        0.9340 0.8111 +0.0324 +3.99% set 15:12 
CD.Z09 Dec 2009 0.7000 0.7000 0.7000 0.8108 +0.0324 +4.00% set 15:12 
CD.H10 Mar 2010 0.8800 0.8800 0.8800 0.8105 +0.0324 +4.00% set 15:12 
 

Other combinations: (http://quotes.ino.com/exchanges/?c=currencies)

Market          Open    High    Low     Last    Change   Pct 
AUSTRALIAN $/CANADIAN $ (CME:ACD)
ACD.Z08 Dec 2008 0.8002 0.8002 0.8002 0.8002 +0.0063 +0.79%   
BRITISH POUND/US$ (SMALL) (NYBOT:MP)
MP.Z08.E Dec 2008 (E) 1.5028 1.5305 1.5028 1.5305 +0.0190 +1.26%   
EURO/BRITISH POUND (NYBOT:GB)
GB.Z08.E Dec 2008 (E) 0.8563 0.8563 0.8518 0.8518 +0.0007 +0.08%     
EURO/JAPANESE YEN (NYBOT:EJ)
EJ.Z08.E Dec 2008 (E) 124.45 124.45 123.37 124.38 -0.19 -0.15%      
EURO/US$ (SMALL) (NYBOT:EO)
EO.Z08.E Dec 2008 (E) 1.28660 1.30690 1.28015 1.30190 +0.01490 +1.15%   

Blather (from http://quotes.ino.com/exchanges/?r=CME_CD)

The December Canadian Dollar was lower overnight due to profit taking as it consolidates some of Monday's rally. Stochastics and the RSI are oversold and are turning bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 81.87 are needed to confirm that a short-term low has been posted. Closes below October's low crossing at 76.86 would renew this fall's decline while opening the door for additional weakness into early-December. First resistance is Monday's high crossing at 81.71. Second resistance is the 20-day moving average crossing at 82.13. First support is last Thursday's low crossing at 79.83. Second support is October's low crossing at 76.86.

Analysis

Ok, these four cent swings are getting annoying.

Here's last night's figures.

Market            Open   High    Low   Last  Change    Pct Time
CD.Y$$ Cash     0.7913 0.8166 0.7906 0.8081 +0.0310 +3.99% 15:01 
CD.Z08 Dec 2008 0.7900 0.8150 0.7900 0.8082 +0.0313 +4.03% set 14:59 
CD.H09 Mar 2009 0.7987 0.7987 0.7987 0.8093 +0.0316 +4.05% set 10:04 
CD.M09 Jun 2009 0.7805 0.7806        0.8099 +0.0318 +4.07% set 15:07 
CD.U09 Sep 2009 0.9350        0.9340 0.8111 +0.0324 +4.16% set 15:07 
CD.Z09 Dec 2009 0.7000 0.7000 0.7000 0.8108 +0.0324 +4.16% set 15:07 
CD.H10 Mar 2010 0.8800 0.8800 0.8800 0.8105 +0.0324 +4.16% set 15:07

So the loonie's ramping up during North American trading, then falling off on the Asian markets, repeat next day.

I'm getting dizzy.

[tclambert]

105. Disappointment. A post labelled "loonie watch" yet no mention of Ann Coulter.

[MadinMo]

111. LOL!!!

:rofl:

[TalkingDog]

78. What to do with all those deflated stocks.

Go shopping for the holidays!

http://www.cnbc.com/id/27888369


Have a good day all....

[Joanne98]

81. Leveraged ETF's

http://direxionshares.com/etfs

[specimenfred1984]

101. We are living through the absolute looting of America

The "bailout" is at $7.7 trillion now, as if money is just created out of thin air which, it is in the criminal administration we've had for the last 8 years. The money is being looted so quickly/purposely that the American public has no chance to respond, not that 99% of our propaganda culture would even be capable of understanding how they're being robbed anyway. This is it, the end of America as we knew it.

The new America will be paying off debt for years, be constant prey to criminals, black markets and easy manipulation and, become quickly disillusioned by the new admin that will try to let 1000s of criminals walk.

[Juneboarder]

103. I agree, but...

try and remain positive and focus my energy in continuing to educate friends and family and do my part towards conservation and helping the community.

[hamerfan]

120. Thank the Gods I have no children

to leave this massive debt to. I am sorry for those of you who do...
dumpbush

[DemReadingDU]

107. FDIC adds 54 more banks to its 'problem list'

11/25/08 FDIC adds 54 more banks to its 'problem list'
The Federal Deposit Insurance Corp. said Tuesday the list of banks it considers to be in trouble shot up nearly 50 percent to 171 during the third quarter—yet another sign of escalating problems among the institutions controlling Americans' deposits.
The 171 banks on the FDIC's "problem list" encompass only about 2 percent of the nearly 8,500 FDIC-insured institutions. Still, the increase from 117 in the second quarter is sharp, and the current tally is the highest since late 1995.

"We've had profound problems in our financial markets that are taking a rising toll on the real economy," said FDIC Chairman Sheila Bair in a statement, adding that Tuesday's report "reflects these challenges."

Banks across the country have been hurt—and in some cases, devastated—by the collapse of the subprime mortgage market and subsequent problems across the lending spectrum. As the FDIC report shows, the number of hobbled institutions is rising at a quickening pace, a trend that has already begun to reshape the banking industry.

more...
http://www.breitbart.com/article.php?id=D94M5AMG0&show_article=1

[antigop]

109. Krugman: The Fed is Confusing Me

http://krugman.blogs.nytimes.com/2008/11/25/the-fed-is-confusing-me/

OK, so the Fed is planning to buy obligations of the GSEs — as well as securities guaranteed by the GSEs. This is in an effort to lower spreads. The Fed will in effect pay for these purchases by having the Treasury issue U.S. government debt.

But the GSEs have been nationalized. Their obligations are already U.S. government debt. What’s going on here?

It’s true, as the Fed’s statement says, that

Spreads of rates on GSE debt and on GSE-guaranteed mortgages have widened appreciably of late.

But that’s presumably because the Bush administration, weirdly, has refused to declare that GSE debt is backed by the full faith and credit of the US government. Why not just make that declaration, turning GSE debt into Treasury obligations, rather than stuff the obligations onto the balance sheet of the Federal Reserve?

Is this some kind of strange political game? Is there something else going on here? Inquiring minds want to know.

[Demeter]

119. Considering The Recent Past, The Mind Boggles

These criminal morons could do anything, including declaring black is white and and vice versa. And Nancy would let them, cheerfully.

[ozymandius]

113. Here's how it all shook out.

Dow 8,479.47 Up 36.08 (0.43%)
Nasdaq 1,464.73 Down 7.29 (0.50%)
S&P 500 857.39 Up 5.58 (0.66%)
10-Yr Bond 3.092% Down 0.248
NYSE Volume 7,728,153,000
Nasdaq Volume 2,505,345,000

4:25 pm : Tuesday marked a choppy day of trade as investors digested $800 billion in government efforts to shore up consumer lending and several economic reports. The S&P 500 settled with a 0.7% gain after trading up as much as 2.0% and down as much as 2.0%.

In an effort to reduce the cost and increase the availability of credit for purchasing a house, the Federal Reserve created a program that will purchase up to $600 billion in direct obligations and mortgage-backed securities of housing-related government-sponsored enterprises.

Separately, the Fed created a new facility aimed at reducing the cost and increasing the availability of auto loans, student loans, credit cards, and small business loans. The Federal Reserve will lend up to $200 billion in its Term Asset-Backed Securities Loan Facility to help facilitate the issuance of asset-backed securities.

Stocks related to asset-backed securities and housing benefited from the news. Homebuilders spiked 20% on hopes that lower mortgage rates will spur increased demand. SLM Corp (SLM 9.62, +1.72), which provides education finance, surged 22%.

In economic news, third quarter real GDP was revised to a 0.5% annual rate of decline from a 0.3% rate, which met expectations. Third quarter personal consumption expenditures was revised to -3.7% from -3.1%.

Consumer confidence rose by are large-than-expected amount in November, but remains at an extremely depressed state as the economic turmoil takes a toll on sentiment. November consumer confidence rose 6.1 to 44.9 from October when confidence fell to an all-time low of 38.8, according to the Conference Board. Economists expected confidence of 39.5

The November Richmond Fed Manufacturing Index, a regional manufacturing survey, fell to -38 from -26 in October, which was worse than the expected reading of -27. This represents contraction in manufacturing in the Richmond region.

Home prices continue to show weakness, with prices in 20 major metro areas falling 17.4% in September compared to the previous year, according to S&P/Case-Shiller.

Eight of the ten sectors posted a gain. Materials (+3.2%), financials (+2.5%) and telecom (+2.1%) saw the most buying interest

The tech sector (-1.5%) underperformed, with Hewlett-Packard (HPQ 33.61, -2.09) dropping 6% despite reporting fiscal fourth quarter earnings and fiscal year 2009 guidance that was in-line with the company's preannouncement last week. Cisco (CSCO 15.38, -1.02) was a laggard after announcing that it will shut down most of its U.S. and Canadian operations during the last week in December as part of its cost saving efforts, according to reports. As a result, the tech-heavy Nasdaq posted a loss.

Small- and mid-cap stocks outperformed their large-cap counterparts, with the Russell 2000 advancing 1.5% and the S&P 400 gaining 1.9%.

In commodity trading, oil prices dropped 6.4% to $51.00 per barrel.

Long-term Treasuries rallied, with the 10-year note climbing more than two points to send its yield down to 3.08% and the 30-year bond rose three points to send its yield down to 3.61%.DJ30 +36.08 NASDAQ -7.29 NQ100 -1.0% R2K +1.5% SP400 +1.9% SP500 +5.58 NASDAQ Adv/Vol/Dec 1529/2.46 bln/1195 NYSE Adv/Vol/Dec 2153/1.88 bln/1005

[tama]

114. Bonds

http://finance.yahoo.com/q?s=^TNX

Yahoo says 10-year yield dropped today whopping 7,43 % to 3,09. Another lowest ever. So when is the bond bubble going to burst?