STOCK MARKET WATCH, Monday, September 5, 2011

[Pale Blue Dot]

Source: du

STOCK MARKET WATCH, Tuesday August 30, 2011

AT THE CLOSING BELL ON August 29, 2011

Dow 11,240.26 -253.31 (-2.25%)
Nasdaq 2,480.33 -65.71 (-2.65%)
S&P 500 1,173.97 -30.45 (-2.59%)
10-Yr Bond... 1.99 -0.14 (-6.70%)
30-Year Bond 3.30 -0.19 (-5.55%)

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Market Conditions During Trading Hours

Euro, Yen, Loonie, Silver and Gold

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Handy Links - Market Data and News:Economic Calendar    Marketwatch Data    Bloomberg Economic News    Yahoo! Finance    Google Finance    Bank Tracker    
Credit Union Tracker    Daily Job Cuts

Handy Links - Economic Blogs:
The Big Picture    Financial Sense    Calculated Risk    Naked Capitalism    Credit Writedowns
Brad DeLong      Bonddad    Atrios    goldmansachs666    The Stand-Up Economist

Handy Links - Government Issues:
LegitGov    Open Government    Earmark Database    USA spending.gov

Handy Links - Videos:
The Coming Collapse of the Middle Class    Charlie Rose talks with Roubini    Charlie Rose talks with Krugman
    William Black: This Economic Disaster    Bill Moyers with Kevin Drum and David Corn

Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren
Dishonorable Mention: former House majority leader, Tom DeLay

Bush Administration Officials Charged = 1
Name(s): Richard Lopez Razo

Financial Sector Officials Convicted since 1/20/09 = 12

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This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.

Read more: du

[Pale Blue Dot]

1. No labor day reports - but check out those bond yeilds!

Holy crap!

[Demeter]

26. Is the Market Open today?

[CatholicEdHead]

48. Overseas it is

in the past this would be a WEE day, but it is a good thread so far to talk about international markets which are open.

[Pale Blue Dot]

2. Oil falls to below $86 after weak US jobs report

SINGAPORE – Oil prices extended losses to below $86 a barrel Monday in Asia as a dismal August jobs report suggested that a weak U.S. economy will lessen demand for crude.

Benchmark oil for October delivery was down 65 cents to $85.80 at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude fell $2.48 to settle at $86.45 on Friday.

In London, Brent crude for October delivery was down 75 cents at $111.58 on the ICE Futures exchange.

Crude has fallen since the Labor Department said Friday that U.S. employers stopped adding jobs in August and the unemployment rate remained at 9.1 percent.

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

[xchrom]

21. ConocoPhillips struggling with China oil spill

http://hosted.ap.org/dynamic/stories/A/AS_CHINA_OIL_SPILL?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-05-06-23-17

SHANGHAI (AP) -- The oil spills from offshore wells operated by ConocoPhillips in China's Bohai Bay are posing political and technical challenges for the oil company far messier than the crude and drilling mud seeping from the seabed.

The company said Monday that it had suspended all drilling, water injection and production at the affected Penglai 19-3 oil field, one of China's biggest.

Operations are currently stopped at 180 producing wells and 51 injecting wells, for a total of 231 wells, said a statement by Houston, Texas-based ConocoPhillips, which operates the field in a venture with state-owned China National Offshore Oil Corp.

CNOOC, which owns 51 percent of the venture, said the suspension of production in Penglai 19-3 would reduce output by 40,000 barrels a day, in addition to the 22,000 barrels a day lost with the shutdown of the two wells where the spills occurred.

[Demeter]

49. And that's why gas is back up to $4 ? Pah!

[Pale Blue Dot]

3. S&P 500 Index Stock Futures Fall, Signaling More Losses After Jobs Report

U.S. stock futures fell, signaling the Standard & Poor’s 500 Index may slide for a third day when trading reopens tomorrow, amid concern the world’s largest economy is weakening.

Bank of America Corp. (BAC), the biggest U.S. lender by assets, declined 2.9 percent in European trading, while Citigroup Inc. lost 2.7 percent in Germany. The banks were among the 17 lenders sued by the Federal Housing Finance Agency on Sept. 2 over residential mortgage-backed securities. Alcoa Inc., the largest U.S. aluminum producer, retreated 2.2 percent in Europe after metal prices fell.

S&P 500 futures expiring in September lost 1 percent to 1,157.3 as of 11:12 a.m. in London. U.S. markets are closed today for the Labor Day holiday. The S&P 500 tumbled 2.5 percent on Sept. 2, erasing the index’s weekly advance, after government data showed employment stagnated last month.

“It was a scary report,” Dan North, chief U.S. economist at Euler Hermes ACI in Owings Mills, Maryland, said in an interview from Singapore with Susan Li on Bloomberg Television. “When you get to negative job growth, which we’re very close to now, it means you’re already in a recession.”

http://www.bloomberg.com/news/2011-09-05/s-p-500-index-stock-futures-fall-signaling-more-losses-after-jobs-report.html

[Pale Blue Dot]

4. Stocks, Italian Bonds Drop on Europe Debt

Stocks fell, Italian bonds dropped for an 11th day and the cost of government and bank default insurance rose to records on concern Europe’s debt crisis will worsen. The euro weakened, while the dollar and gold gained.

The MSCI All-Country World Index sank 1.5 percent at 10:50 a.m. in London. Banks led the Stoxx Europe 600 Index 2.8 percent lower. The yield on the Italian 10-year bond rose 11 basis points in the longest sequence of gains since the euro’s debut in 1999. The German bund yield fell to a record. The Markit iTraxx SovX Western Europe Index of credit-default swaps on 15 governments rose 8.5 basis points. The euro weakened for the fifth day versus the dollar, the longest streak since January.

German Chancellor Angela Merkel’s party lost weekend elections in her home state, stoking concern opposition is growing to bailouts for debt-saddled European nations. The U.S. filed 17 lawsuits against banks on Sept. 2 to recover $196 billion spent on mortgage-backed securities bought by Fannie Mae and Freddie Mac. Citigroup Inc. cut its 2011 global economic growth forecast today to 3.1 percent from 3.7 percent. U.S. markets are closed today for the Labor Day holiday.

“Sovereign risk-related events remain the main market drivers,” Markus Ernst, a strategist at UniCredit SpA in Munich, wrote in a note. “The negative market sentiment is unlikely to change for the better in Europe.”

http://www.bloomberg.com/news/2011-09-05/asian-stocks-drop-for-second-day-dollar-climbs-on-u-s-jobs-europe-debt.html

[Pale Blue Dot]

5. RBS Leads European Banks Lower on Lawsuit

Royal Bank of Scotland Group Plc (RBS) led European banks lower after 17 lenders were sued by the U.S. over the sale of mortgage-backed securities and on continuing investor concern over interbank lending.

RBS, Britain’s biggest government-owned lender fell as much as 10 percent to 22.35 pence in London, the sharpest decline since Aug. 18 and was down 8.2 percent at 10:32 a.m. Barclays Plc (BARC) dropped 7.4 percent to 153 pence and Deutsche Bank AG retreated 7.4 percent to 24.11 euros.

“This is really about fears about liquidity and solvency now,” said Andrew Lim, a banking analyst at Espirito Santo Investment Bank in London. “U.S. money markets are lending less for a second month to European banks, particularly French banks. Banks are having to come back to the market to complete their 2011 borrowing programs and if they fail in that respect that’s going to create a lot of risk.”

On Sept. 2, Barclays and Deutsche Bank were among European, Asian and U.S. banks sued by the U.S. Federal Housing Finance Agency to recoup $196 billion spent on mortgage-backed securities bought by Fannie Mae and Freddie Mac. The Bloomberg Europe Banks and Financial Services Index fell as much as 4.4 percent.

http://www.bloomberg.com/news/2011-09-05/rbs-leads-european-banks-lower-on-funding-concern-u-s-mortgage-lawsuit.html

[Fuddnik]

6. Asia takes a dive overnight.

Europe getting on the down elevator.

^AORD All Ordinaries 4,224.20 2:36AM EDT Down 97.30 (2.25%) Components, Chart, More
^SSEC Shanghai Composite 2,478.74 3:00AM EDT Down 49.54 (1.96%) Chart, More
^HSI Hang Seng 19,616.40 4:01AM EDT Down 596.51 (2.95%) Components, Chart, More
^BSESN BSE 30 16,713.33 6:30AM EDT Down 108.13 (0.64%) Chart, More
^JKSE Jakarta Composite 3,866.17 5:00AM EDT Up 24.44 (0.64%) Components, Chart, More
^KLSE KLSE Composite 1,463.12 4:50AM EDT Down 10.97 (0.74%) Components, Chart, More
^N225 Nikkei 225 8,784.46 2:28AM EDT Down 166.28 (1.86%) Chart, More
^NZ50 NZSE 50 3,293.13 1:31AM EDT Down 10.08 (0.31%) Components, Chart, More
^STI Straits Times 2,773.17 5:10AM EDT Down 69.92 (2.46%) Components, Chart, More
^KS11 Seoul Composite 1,785.83 5:05AM EDT Down 81.92 (4.39%) Components, Chart, More
^TWII Taiwan Weighted 7,551.57 1:31AM EDT Down 205.49 (2.65%)



We're closed today, I assume.

[xchrom]

7. morning!

:donut:

[xchrom]

8. phantom power turned me onto to this: Life in Hooverville

http://delong.typepad.com/sdj/2011/09/life-in-hooverville.html

I remember the week after Obama's 2010 State of the Union Address, I had a few conversations with Obama Senior Administration Officials (and not the ones that you are thinking of either). I took particular exception to:

Remarks by the President in State of the Union Address 2010: f we had taken office in ordinary times, I would have liked nothing more than to start bringing down the deficit. But we took office amid a crisis. And our efforts to prevent a second depression have added another $1 trillion to our national debt. That, too, is a fact. I'm absolutely convinced that was the right thing to do. But families across the country are tightening their belts and making tough decisions. The federal government should do the same. So tonight, I'm proposing specific steps to pay for the trillion dollars that it took to rescue the economy last year.

Starting in 2011, we are prepared to freeze government spending for three years. Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected. But all other discretionary government programs will. Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don't. And if I have to enforce this discipline by veto, I will. We will continue to go through the budget, line by line, page by page, to eliminate programs that we can't afford and don't work. We've already identified $20 billion in savings for next year. To help working families, we'll extend our middle-class tax cuts. But at a time of record deficits, we will not continue tax cuts for oil companies, for investment fund managers, and for those making over $250,000 a year. We just can't afford it.

Now, even after paying for what we spent on my watch, we'll still face the massive deficit we had when I took office. More importantly, the cost of Medicare, Medicaid, and Social Security will continue to skyrocket. That's why I've called for a bipartisan fiscal commission, modeled on a proposal by Republican Judd Gregg and Democrat Kent Conrad. This can't be one of those Washington gimmicks that lets us pretend we solved a problem. The commission will have to provide a specific set of solutions by a certain deadline. Now, yesterday, the Senate blocked a bill that would have created this commission. So I'll issue an executive order that will allow us to go forward, because I refuse to pass this problem on to another generation of Americans. And when the vote comes tomorrow, the Senate should restore the pay-as-you-go law that was a big reason for why we had record surpluses in the 1990s. Now, I know that some in my own party will argue that we can't address the deficit or freeze government spending when so many are still hurting. And I agree -- which is why this freeze won't take effect until next year, when the economy is stronger…

As I recall, I said back then:

1.

There was absolutely no reason to start deficit reduction until the unemployment rate fell below 7.5% or until interest rates started to spike. To say that deficit reduction would start "next year" rather than "when the Lesser Depression is over" was an unforced error.
2.

To appoint as co-chair of your deficit commission a long-term budget arsonist like Alan Simpson--who never in his entire legislative career found a budget-busting Republican measure he could vote against or a deficit-reducting Democratic measure he could vote for--was an unforced error.
3.

To appoint as co-chair of your deficit commission a Republican like Alan Simpson who (a) does not bring with him a single vote in either legislative house, (b) is not terribly knowledgeable about budget issues, and (c ) is not terribly stable or prudent in his public utterances was an unforced error.
4.

To appoint as the other co-chair of your deficit commission someone like Erskine Bowles whose initial negotiating position is where you want to ultimately end up was an unforced error. Much better to appoint somebody knowledgeable and persuasive who starts as far to the left of where Obama wants to wind up as Alan Simpson is to the right--an ex-cabinet member like Laura Tyson or Bob Reich, say.
5.

*****it's worth reading the rest.

[xchrom]

9. asia: Toyota to make new Prius in China

http://search.japantimes.co.jp/cgi-bin/nb20110905a1.html

NAGOYA — Toyota Motor Corp. plans to begin making its popular Prius hybrid in China to bolster sales of the environmentally safer vehicle in what is now the world's largest car market, company officials said Sunday.

Toyota has recently obtained approval from Chinese authorities to produce its third Prius model after manufacturing the second model there in a tieup with China FAW Group Corp. from 2005 to 2009.

For the time being, the carmaker will make the hybrid's key parts — such as the batteries and motors — in Japan and export them to China. In the long run, it will gradually shift production of those parts to China, they said.

Analysts say the move appears to be part of Toyota's efforts to make its business less vulnerable to fluctuations in the yen. The yen has climbed roughly 10 percent against the dollar and other major currencies since last summer.

[xchrom]

16. Asian shares tumble on grim U.S. jobs report

http://latimesblogs.latimes.com/money_co/2011/09/asian-shares-tumble-on-grim-us-jobs-report.html

Asian shares suffered heavy losses Monday on the first day of trading after last week's bleak U.S. jobs report intensified fears of a global recession.

Japan's Nikkei 225 index was down 1.8%, Hong Kong's Hang Seng index lost about 3% and South Korea's Kospi nosedived 4.4%.

China's benchmark stock index slumped 2% to close at a 13-month low on fears the government would continue to tighten monetary policy.

Chinese Premier Wen Jiabao said last week that stabilizing consumer prices is the government's chief priority.

[xchrom]

22. World Bank: China can help by boosting consumption

http://hosted.ap.org/dynamic/stories/A/AS_CHINA_WORLD_BANK?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-05-06-01-53

BEIJING (AP) -- China can boost global economic growth by pressing ahead with reforms to promote domestic consumption and reduce reliance on exports and investment, World Bank President Robert Zoellick said Monday.

Communist authorities have said repeatedly they want more self-sustaining growth based on domestic consumption. But they have made little progress, and investment as a share of China's economy rebounded after Beijing launched a stimulus based on public works spending following the 2008 global crisis.

The World Bank is working with Beijing on developing ways to rebalance the world's second-largest economy, Zoellick told reporters after meeting with Chinese officials.

"The world economy won't get out of this hole by simply relying on austerity policies," he told reporters.





*****seems like only yesterday -- they said the same sweet nothings to us.

[xchrom]

10. south asia: Gold hits record high of Rs 28,350 per 10 gram

http://economictimes.indiatimes.com/markets/commodities/gold-hits-record-high-of-rs-28350-per-10-gram/articleshow/9871096.cms

MUMBAI: Gold demand in India, the world's biggest buyer, was moderate on Monday after the prices in the local market rose 2 percent to a record high tracking firmness in the world market and due to a weak rupee, dealers said.

At 3:57 p.m., the October contract on the Multi Commodity Exchange was up 1.74 percent at 28,273 rupees per 10 grams, after hitting a record high of 28,355 rupees earlier in the day.

The contract has risen over 20 percent since the beginning of August. "Demand was normal. People were buying despite the record high prices," said T.K. Chandiran, managing director with Coimbatore-based KTM Jewellery. "Though most people are buying jewellery, sales of coins and bars have also risen."The rupee stayed weak in afternoon trade as dollar gained overseas with investors seeking safe-haven assets after bleak jobs data on Friday cemented view the United States might be slipping back into a recession.

At 1:52 p.m., the partially convertible rupee was at 45.88/90 per dollar, weaker than Friday's close of 45.79/80 when it had gained 0.6 per cent. The index of the dollar against six major currencies was 74.970 points, after touching 75.074 points, strongest level since Aug 5 earlier. It had been 74.506 at close of domestic currency markets on Friday.

[xchrom]

11. Sensex falls 108 points, snaps 3-day surge on weak global trend

http://economictimes.indiatimes.com/markets/stocks/market-news/sensex-falls-108-points-snaps-3-day-surge-on-weak-global-trend/articleshow/9872337.cms

MUMBAI: Snapping three sessions of upsurge, the BSE benchmark Sensex today fell 108 points on profit booking by investors amid a weak global trend.

The Bombay Stock Exchange 30-share index, Sesnex, which had gained 972 points in last three sessions, fell 108.13 points, or 0.64 per cent to 16,713.33.

The decline was led by refinery, IT and healthcare sectors.

Selling pressure gathered momentum as investors booked profits after the stock market surged 6.1 per cent in last three sessions. On weekly basis, it fell for five weeks in a row -- its longest run of losses since October 2008.

[xchrom]

12. Fascination with gold hampering India's growth story

http://timesofindia.indiatimes.com/business/india-business/Fascination-with-gold-hampering-Indias-growth-story/articleshow/9868535.cms

NEW DELHI: The glitter of gold is taking the shine off India's growth story. According to World Gold Council, India's gold imports rose 60% in April-June 2011 from a year ago, as people snapped up the timetested hedge against inflation. India has always been a huge gold consumer, but the yellow metal is now our second-biggest import, behind crude, up from fifth place in 2007-08.

But, this fascination with gold could be a reason why growth seems to be flagging. Money locked up in the yellow metal effectively disappears from the economy to become jewellery or sits idle in bank lockers. "Money spent on gold is mostly wasted because it's only hoarded and simultaneously excluded from the financial inter-mediation system," said Abheek Barua, chief economist, HDFC Bank.

As money has flowed into gold, India's household savings have moved away from productive financial assets, falling to 9.7% of GDP during 2010-11 compared with 12.1% in the previous year. This shift away from financial savings can dent growth, but it's hard to say by exactly how much.

"To the extent there is a shift from household savings in financial assets towards gold, which we know has been happening, it would lead to some loss in the GDP growth," said Indranil Pan, chief economist, Kotak Bank, "although it's hard to gauge the magnitude of the loss." Gold imports are up nearly half a percentage point of the GDP in the last three years, implying that much more of savings is getting locked up in an unproductive asset.

[Demeter]

27. Meaning: We Can't Blow Bubbles If You Buy Gold

Try our American-bankster toilet paper--it's 3 ply!

[xchrom]

13. How to profit from investing in art

http://www.marketwatch.com/story/how-to-profit-from-investing-in-art-2011-09-02

?uuid=21a29b42-d4e8-11e0-947a-00212803fad6
Andy Warhol’s "Silver Liz" portrait of actress Elizabeth Taylor sold in June 2010 for $10.1 million.

SYDNEY(MarketWatch) — Art lovers are often savvy investors, without even realizing it.

As an asset class, art is a proven long-term store of wealth. With stock-market volatility and sovereign-debt woes driving investors toward hard assets, art is an increasingly popular way to add depth to a traditional investment portfolio.

Art offers low correlation to the price movements of other assets, and it’s effective as a unique hedging strategy. Works of art can also attract an income stream. Experts point to annual rates of return of between 8% and 20% for the best-performing sectors.

[xchrom]

14. ooops dupe. nt

[xchrom]

15. More data to come on the ‘zero’ jobs market

http://www.marketwatch.com/story/more-data-to-come-on-the-zero-jobs-market-2011-09-04

WASHINGTON (MarketWatch) — When traders return from the Not-Much-Labor Day break, they’ll be greeted with more data to confirm or refute whether the job market is the zero that a key government report suggested.

Reports on the services sector, job openings and jobless claims as well as the anecdotes contained in the Fed’s Beige Book all will provide more context on the Labor Department’s report that no jobs outside the farm sector were created in August. See story on August jobs report.

This week’s data, though not as closely followed by the market as the nonfarm payrolls report, are worth examining because historically they have done a pretty good job assessing the labor market (and also because President Barack Obama on Thursday is due to give a major speech outlining initiatives to bolster the jobs market.)

On a scale of 1 to -1, the correlation between the employment component of the Institute for Supply Management’s non-manufacturing report and the Labor Department’s nonfarm payrolls number is a strong 0.87, according to data compiled by Haver Analytics.

[xchrom]

17. Is California economy improving, or worse than ever?

http://latimesblogs.latimes.com/money_co/2011/09/is-california-economy-improving-or-worse-than-ever.html

Depending on who you ask this Labor Day, California's economy is either on its way up or headed straight for the crapper.

A report released today by the California Budget Project finds that the state has a historically low level of employment, even as earnings are declining for most workers. By July, the report says, the state had gained back only one out of six jobs lost during the recession. The state added only 2,760 jobs a month between February and July.

Government is dragging down the economy, the report says. Over the last three years, the state has lost public sector jobs at a rate twice that of the nation as a whole, the report says. Inland areas aren't helping either -- between June 2010 and June 2011, the Inland Empire lost 10,300 jobs.

Finally, inflation-adjusted earnings in California declined 1.9% between 2006 and 2010, the report says, making a typical worker have less purchasing power in 2010 than at any point in the last 10 years.

[xchrom]

18. europe: Next ECB head calls for integration as yields rise

http://hosted.ap.org/dynamic/stories/E/EU_EUROPE_FINANCIAL_CRISIS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-05-08-52-40

PARIS (AP) -- The eurozone needs a "quantum" leap toward economic integration, the incoming chief of the European Central Bank said Monday, as the bond yields of countries with shaky finances, like Greece and Italy, jumped amid increased investor tensions.

Mario Draghi told a conference in Paris that among the common currency's problems is a lack of coordinated fiscal policies and that the solution was more integration.

He dismissed the idea of eurobonds - debt issued jointly by the eurozone countries. Some have argued this would help weaker countries borrow more easily because they wouldn't have to pay such high interest rates, which in turn make their debts bigger. But stable countries like Germany would likely see their rates rise.

Instead, Draghi suggested the eurozone should adopt rules that would require more budget discipline. There is already a proposal that would require all eurozone countries to balance their budgets. Profligate spending during boom times funded by cheap debt is one of the root causes of the current crisis.

[xchrom]

37. Deutsche Bank Pessimism Ackermann Warns of Renewed Financial Crisis

http://www.spiegel.de/international/business/0,1518,784497,00.html

It has been a mere three years since the collapse of the investment bank Lehman Brothers plunged the world into a deep financial crisis. But now, with economic indicators offering little room for optimism, a new crisis may be on the horizon.

That, at least, was the message offered by Deutsche Bank CEO Josef Ackermann on Monday in comments delivered at a conference in Frankfurt. "We should resign ourselves to the fact that the 'new normality' is characterized by volatility and uncertainty," Ackermann said. "All this reminds one of the autumn of 2008."

The volatility was on full display on Monday as the leading German market index, the DAX, plunged to a two-year low and stocks of European banks , including Ackermann's Deutsche Bank, lost value. The price of gold once again spiked upwards as investors sought security.

In addition, the European Central Bank reported that European banks on Friday parked €151 billion overnight with the ECB, the highest total in more than a year. The increase reflects growing distrust on the financial markets, with banks shunning the higher interest rates they would earn by depositing money with each other.

[TalkingDog]

45. Yeah... The DAX plunging is NOT a good sign.

Dow Futures down almost 300. Black Tuesday here we come.

[xchrom]

47. it's not very rosey right now, that's for sure. nt

[xchrom]

41. 'Europe Needs to Wake Up'

http://www.spiegel.de/international/europe/0,1518,784357,00.html

In a SPIEGEL interview, former German Chancellor Gerhard Schröder, 67, discusses the German government's learning curve in the euro crisis and his idea of a United States of Europe. He also addresses allegations that his government helped set the stage for the current common currency woes.

SPIEGEL: Mr. Schröder, is the euro in mortal danger?

Schröder: No. If you look at the external value of the euro in relation to the dollar, we were once at 82 cents and are now at 1.40. The euro is not in danger. What is missing is a political concept.

SPIEGEL: But something is going fundamentally wrong with the euro at the moment.

Schröder: (Former French President Francois) Mitterand and (former German Chancellor Helmut) Kohl were pursuing two basic ideas in creating the euro. Mitterand wanted to contain Germany's economic power within Europe by means of a common currency. That couldn't work. If you create a common currency, the stronger economy will prevail. Kohl's mistake was to assume that the common currency would inevitably lead to political union. And the crisis we are currently experiencing makes it abundantly clear that you can't have a common currency without a common fiscal, economic and social policy.

SPIEGEL: You said the same thing before you became chancellor, and then you didn't pursue it.

Schröder: Europe is a very tough nut to crack. Everyone who has ever done it knows this. That's why I am also hesitant to criticize administrations now in power. I admit that I would like to have achieved more than I did. When I was in office, I would have liked to bring the European constitutional process to a satisfactory conclusion. But it didn't fail because of us.

[xchrom]

44. Double-dip recession fears grow {england}

http://www.independent.co.uk/news/business/news/doubledip-recession-fears-grow-2349613.html

Fears of a double-dip recession were fuelled today as a survey revealed the UK's powerhouse services sector suffered its worst slowdown in activity in 10 years.

The Markit/CIPS Purchasing Managers' Index (PMI), where a reading above 50 indicates growth, showed services activity fell to 51.1 in August from 55.4 in July.

The drop was the worst for the services sector, which makes up around 75% of the total economy, since the foot and mouth crisis of 2001 and was greater than declines seen after the collapse of Lehman Brothers bank in 2008.

Economists said the dismal figures pointed to a potential contraction in gross domestic product (GDP) in the third quarter of the year and increased pressure on the Bank of England to inject more cash into the economy to jump-start the recovery.

[Fuddnik]

19. Hot babe mud wrestling this morning.

Yeah, we found a mud puddle at the park!

[xchrom]

23. ...

:rofl: good job!

[Demeter]

29. In Honor of Labor Day, the Kid

broke the faucet in the kitchen sink...it's gonna have to wait until Thursday. I don't have time or energy before then.

[xchrom]

31. and on a holiday. sorry -- well i hope you all have something fun on the agenda! nt

[Demeter]

50. We had a very successful BBQ

Shut down an hour early due to lack of most of the foods and customers...the sun shone only for an hour, the temperature never got over 65F, but it didn't rain and I didn't get sunburned....nobody went swimming though...

[xchrom]

20. Dismal jobs data shakes world markets

http://hosted.ap.org/dynamic/stories/U/US_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-05-06-07-30

WASHINGTON (AP) -- The dismal U.S. job market, which has intensified fears of another recession, may be even worse than the unemployment numbers suggest.

The shockwaves from the Labor Department report on Friday that employers stopped hiring in August have rippled around the world, sparking a steep retreat in Asian stock markets. The lack of hiring in the U.S. last month surprised investors - economists were expecting 93,000 jobs to be added. Previously reported hiring figures for June and July were revised lower.

The jobs picture may even be worse than the 9.1 percent unemployment rate suggests, because America's 14 million unemployed must also compete with 8.8 million other people not counted as unemployed - part-timers who want full-time work.

When consumer demand picks up, companies will likely boost the hours of their part-timers before they add jobs, economists say. It means they have room to expand without hiring.

[xchrom]

24. Mountains to climb

http://www.economist.com/node/21528266

CENTRAL bankers are not known for seeking solace in the heavens. But at their annual symposium in Jackson Hole, organised by the Federal Reserve Bank of Kansas City, the world’s leading monetary mavens could be found, after dinner, peering enthusiastically into telescopes set up by the local astronomy club. As he spied the M82 galaxy, 12m light-years away, one central banker remarked: “That puts our problems into perspective.”

On the ground, though, those problems are as big as ever. Christine Lagarde, the new managing director of the IMF, voiced a collective sentiment when she said the world economy found itself in a “dangerous new phase”. Things could get riskier still in the coming weeks.

In America, the worry is dashed expectations. The Federal Reserve’s policy-setting committee next meets on September 20th and 21st and has scheduled an extra day’s discussion on its arsenal of unconventional monetary weapons. Wall Street hopes it will mark the onset of “QE3”, another big bout of bond-buying. The mood in Jackson Hole suggested that any action will be modest and incremental.

Many central bankers, including Ben Bernanke, the Fed’s chairman, think it is time for fiscal policy to do more. He gave Congress a scolding at Jackson Hole, arguing that politicians need to address the medium-term fiscal mess while leaving room to cushion the economy now. Barack Obama is working on a jobs plan but the chances of a political rapprochement on issues like America’s payroll-tax cut, due to expire soon, remain uncertain. No deal implies sharply tighter fiscal policy.

[Demeter]

30. Only if a deadly meteor was heading in their direction

would they have some "perspective" or "insight" into their position....

[xchrom]

25. Boeing’s woes Nightmareliner

http://www.economist.com/node/21528275

T WAS tempting fate to call an ambitious new aircraft the “Dreamliner”. A combination of radical technology and a novel outsourced system of manufacture has turned the Boeing 787 into a nightmare.

Since its launch in December 2003, delay has piled on delay. The 787’s seal of approval from the American and European aviation authorities on August 26th and its first delivery—to All Nippon Airways in late September—come more than three years behind schedule.

Nor do the company’s woes end there: it now faces the difficult task of ramping up production and delivering 787s to impatient customers. Three dozen part-finished 787s are lying around airfields by Boeing’s Everett factory north of Seattle, with ten more inside. The original plan was to have delivered over 100 787s by the end of 2009. Instead the company will be lucky to dispatch seven by the end of this year, and it will be late 2013 before production reaches the ten planes a month needed to break into profit.

[xchrom]

28. Stagnant U.S. Hiring May Signal Renewed Recession

http://www.bloomberg.com/news/2011-09-05/stagnant-august-payrolls-in-u-s-add-to-signals-of-renewed-recession-risk.html

Scott Eells/Bloomberg

Construction workers cross a street in the Manhattan borough of New York. Hourly earnings and hours worked both declined, reducing the incomes of consumers whose spending accounts for 70 percent of the world’s largest economy.

Construction workers cross a street in the Manhattan borough of New York. Hourly earnings and hours worked both declined, reducing the incomes of consumers whose spending accounts for 70 percent of the world’s largest economy. Photographer: Scott Eells/Bloomberg

The U.S. may be on the cusp of a recession for the first time in more than two years.

Stagnant payrolls in August reported last week added to data over the past month showing the economy is faltering, including slowing manufacturing, plunging consumer confidence, falling home values and lower bond yields and stock prices.

“At this stage of the typical expansion we expect above- average growth and instead we are barely seeing any growth at all,” said James Hamilton, an economics professor at the University of California, San Diego, who has advised Federal Reserve banks and studied what tips the U.S. into downturns. “We have to be more worried. Overall, the economy is in a delicate position and another shock could send us down.”

September could mark the start of the slump, said Julia Coronado, chief economist for North America at BNP Paribas in New York, who predicts the economy will shrink at a 2 percent annual rate in the fourth quarter. Economists at UniCredit Group and Mesirow Financial Inc. also say the U.S. is at risk of tipping into the first recession since the last one ended in June 2009.

[Demeter]

32. It's all of 54F and misty

Shall I take a big pot of minestrone to the barbecue? We are grilling vegetable kabobs and ears of corn, as well as a range of burgers...

You would think winter could wait until the pool was officially closed...

Sheesh!

[Demeter]

33. Wednesday is Yom Kippur

And Thursday marks the 250th anniversary of the marriage between Britain’s George III and Charlotte of Mecklenburg-Strelitz. The couple met on their wedding day, after an intensive search for a suitable wife for the king. The third British monarch of the House of Hanover (the previous two did not speak English) and Queen Charlotte had 15 children.

[xchrom]

39. yom kippur already?

oh my god -- this year has really flown by.

[Demeter]

43. Maybe why it's so cold already

I think the lunar calendar is a better guide to the changing seasons.

[xchrom]

46. it really does seem to work pretty well.

my late great partner & i always did yom kippur & rosh hashanna @ the lgbtiq synagogue in sf.

i couldn't say the name -- he would make me butcher it in front of others for a laugh --

[Demeter]

34. Big oil tanker groups vulnerable, warn bosses

At least one leading oil tanker operator is likely to follow collapsed smaller operators into insolvency, senior figures in the industry believe, as the sector is swamped by oversupply

Read more >>
http://link.ft.com/r/CTBPCC/GDE4F8/SUO9T/08BBEQ/XHG9OX/VU/t?a1=2011&a2=9&a3=4

[Demeter]

35. Unsecured bond sales to test Europe’s banks

Europe’s banks are bracing for a fresh test this month: whether they can successfully sell unsecured bonds. The region’s banks have sold less debt in total so far this quarter than in any comparable period going back to 1996 – when their financing needs were a fraction of their current levels

Read more >>
http://link.ft.com/r/H60H77/YB61C4/Z87P0/7AVVNN/R3UKLD/4O/t?a1=2011&a2=9&a3=4

[Demeter]

36. Wolfgang Schäuble - Why austerity is the only cure for the eurozone

Whatever role the markets may have played in catalysing the sovereign debt crisis in the eurozone, it is an undisputable fact that excessive state spending has led to unsustainable levels of debt and deficits that now threaten our economic welfare. Piling on more debt now will stunt rather than stimulate growth in the long run. Governments in and beyond the eurozone need not just to commit to fiscal consolidation and improved competitiveness – they need to start delivering on these now.

Read more >>
http://link.ft.com/r/3JFELL/VLG173/A5Q0X/97AAUY/R3UY7N/N9/t?a1=2011&a2=9&a3=5

[Hawkowl]

38. Ha! In his dreams!

The reason Greece and Italy are balking on austerity is the rioting in the streets. The only solution is for the bondholders to take a severe haircut, let the sovereigns default, reset the monetary system and start over. In other words, the PIIGS need to go Chapter 11 so they can be profitable again. Unfortunately :sarcasm: the rich bondholding financial elite is going to take one right in the ass. Bondage hurts.

[Demeter]

42. I do like a little levity when I can find it

I agree, he's pleading for special rights for the rich.

[Demeter]

40. Banks 'still expect taxpayers to pay for their failure' given the regulators' information monopoly

http://tyillc.blogspot.com/2011/09/banks-still-expect-taxpayers-to-pay-for.html

A Telegraph column by Philip Aldrick focused on a comment made by the Bank of England's Paul Fisher that banks still expect taxpayers to pay for their failure. As this blog has frequently mentioned, banks should feel this way so long as regulators maintain a monopoly on all the useful, relevant information for each bank. Without this current asset and liability-level data, banks cannot assess the risk of any bank that they do business with and adjust both the price and amount of their exposure according to the findings. Instead, the banks have to rely on the assurances of the regulators that the other banks are solvent. This sets up the situation that we are currently in where taxpayers have to bailout the banks because the banks cannot be held responsible for any losses that result from relying on regulatory assurances.

Mr. Fisher's solution is not to end the regulators' information monopoly and the implied taxpayer bailout of any errors made by regulators, but to run stress tests with more onerous assumptions. Under this solution, regulators continue gambling with the taxpayers' money as the solution still leaves the banks relying on the regulators' assurances of solvency. If these assurances are incorrect, banks should expect the taxpayers to bail them out.

In a paper published yesterday, Paul Fisher, the Bank's executive director for markets, disclosed that "some banks have told us that they think they should not be required to hold capital and liquidity to deal with such extreme tail events – leaving the public sector to be the capital provider of last resort". His comments clash with the public statements of bankers who claim lenders should not be a burden on the taxpayer...Earlier this year, Bob Diamond, Barclays' chief executive, told the Treasury Select Committee: "It is not acceptable for taxpayers to bail out banks," adding that "badly managed" lenders should be allowed to fail. There is no suggestion that Mr Diamond is among those to whom Mr Fisher was referring. Add Mr. Diamond to the list of bank CEOs calling for a disclosure of all the useful, relevant information so they can determine who their dumbest competitor is and avoid any exposure to them....Without the current asset and liability-level data, bank bosses have no ability to assess how risky their exposures to other financial institutions really are. The bank bosses are blindly betting with their exposures to other financial institutions based on regulatory assurances. This is the problem created by the regulators' monopoly on all the useful, relevant information and the publication of assurance by the regulators as to the solvency of each bank!

With the disclosure required under the FDR Framework, this problem goes away....Actually, the greatest sin in the years preceding the financial crisis was the failure to use 21st century information technology to support disclosure of all the useful, relevant information for each financial institution. With this information, each financial institution could have protected itself from other financial institutions that took on excessive risk. A likely result of financial institutions protecting themselves is that the financial crisis would have been far less severe and the financial system would have been far more stable....In the absence of all the useful, relevant information in an appropriate, timely manner, financial market participants cannot deal with tail-risk. The current financial crisis proves this point. The areas of the financial markets that ceased functioning were all the areas with opacity (for example, structured finance and interbank lending). The areas that continued to function without government support all were areas with disclosure (for example, equity markets).

[Demeter]

51. Regulators poised to soften new bank rules

Global bank regulators are preparing to ease new rules that would require banks to hold more liquid assets to withstand a funding crunch in a crisis

Read more >>
http://link.ft.com/r/QM42II/2O26PE/9MEOW/DW55HR/AM48LR/6C/t?a1=2011&a2=9&a3=5

[Demeter]

52. A Thought (or Three) for Labor Day

When people ask me, 'Why can't labor organize the way it did in the thirties?' the answer is simple: everything we did then is now illegal.

~ Thomas Geoghegan



~ If any man tells you he loves America, yet hates labor, he is a liar. If any man tells you he trusts America, yet fears labor, he is a fool.

~ Abraham Lincoln

No business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By living wages I mean more than a bare subsistence level--I mean the wages of decent living.


~ Franklin D. Roosevelt

[Demeter]

53. Eurozone Deathwatch By Mike Whitney

http://www.informationclearinghouse.info/article29039.htm

There's no way to overstate the calamity that's unfolding across the Atlantic. The eurozone is imploding. The smart money has already fled EU banks for safe quarters in the US while political leaders frantically look for a way to prevent a seemingly-unavoidable meltdown. Here's an excerpt from a post at The Streetlight blog that explains what's going on:

"...ECB data seems to indicate that monetary financial institutions (MFIs) in Europe have been moving their deposits out of European banks. Where is that money going?....

European banks are shifting their cash assets out of European banks and putting much of them into US banks. ... This has happened at a significant rate, with a net transatlantic flow from European to US banks that probably totals close to half a trillion dollars in just six months.

If you're wondering exactly who has been the first to lose confidence in the European banking system, look no further. It seems that at the forefront is the European banking system itself." ("Europe's Banking System: The Transatlantic Cash Flow", The Streetlight blog)

The spreads on Spanish and Italian sovereign bonds have risen to nosebleed levels while the interest rate on the Greek 1-year bond has topped 70 percent, a tacit admission that Greece has lost access to the capital markets and will default despite the efforts of the IMF and ECB.

The eurozone is experiencing a slow motion run on its banking system. And--while the ECB's emergency loans and other commitments have kept the panic from spreading to households and other retail customers--the big money continues to vamoose as leaders of large financial institutions realize that a political solution to the monetary union's troubles is still out-of-reach.

German Chancellor Angela Merkel has been blocked in her attempt to push through changes to the European Financial Security Facility (EFSF) that would permit it's governors to use billions in emergency funds to bail out underwater EU banks that made bad bets on sovereign bonds. The German parliament (Bundestag) will vote on the issue on September 23 with the future of the 17-member monetary union hanging in the balance. If the EFSF is not given "expanded powers", the bond markets descend into chaos and the confederation will begin to break up.

This is from Reuters:

"Funding market tensions have triggered emergency measures at European banks, with some firms now dumping assets at the fastest rate since the collapse of Lehman Brothers as they seek to build up stockpiles of cash and reduce their reliance on short-term borrowings.

Nervy lenders have sold off billions of euros of "good assets" since the start of August, according to treasurers and business heads overseeing such sales, with some firms also halting new loans to large corporate clients in an effort to preserve cash.

Such a defensive response to the enfolding funding crisis in Europe is the clearest sign yet that credit market tensions - whether rooted in truth or unwarranted investor panic - pose an increasing threat to the global economic recovery, potentially choking off credit to critical engines of growth." ("Banks dump assets as funding worries intensify", Reuters)

It's a firesale, and it's getting worse. The banks have already jettisoned their good assets and are now left with the toxic waste that will fetch only a fraction of their original cost. As the bank run intensifies, the need for cash will increase forcing the ECB to either dig deeper or let the financial system crash.

MORE

[Ghost Dog]

58. It is fascinating to watch. Me, I'm mobilising

ready for what's coming down.

I mean, Revolution.

:thumbsup:

[Demeter]

54. Gold Rises as Growth, Debt Concerns Boost Demand ($1900/OZ)

http://www.bloomberg.com/news/2011-09-05/gold-climbs-a-3rd-day-as-u-s-europe-economic-concerns-drive-haven-demand.html

Gold rose above $1,900 an ounce on speculation that economic growth will slow and Europe’s debt woes will worsen, boosting demand for a protection of wealth.

European equities dropped after an election loss for German Chancellor Angela Merkel’s party spurred concern that support for bailing out Europe’s indebted nations may fade. Bullion jumped 3.1 percent on Sept. 2, the most in almost four weeks, as data showed the U.S. jobs market stalled in August, prompting renewed speculation that the country’s economy may be headed for a recession.

“With the implications of Friday’s U.S. payrolls report and intense focus on European sovereign issues this week, gold has two strong reasons to rally,” Edel Tully, a London-based analyst at UBS AG, wrote in a report. “Additional evidence of U.S. economic weakness raises the likelihood that the Federal Reserve will announce further easing this month. As European woes reclaim center-stage and in turn investor nervousness extends, these factors will support gold in the coming weeks.”

Gold for immediate delivery gained $17.82, or 0.9 percent, to $1,900.70 an ounce by 7:06 p.m. in London, after touching $1,903.52. The metal set a record at $1,913.50 on Aug. 23. In New York, gold futures for December delivery were up $26, or 1.4 percent, at $1,902.90 on the Comex, after touching $1,908.40. Floor trading in the U.S. was closed today for the Labor Day holiday...The metal fell to $1,895 in the afternoon “fixing” in London, used by some mining companies to sell output, from $1,896.50 at this morning’s fixing....MORE

[Demeter]

55. Since When Is It a Crime to Be Poor?

http://motherjones.com/politics/2011/08/nickel-and-dimed-afterword

I completed the manuscript for Nickel and Dimed in a time of seemingly boundless prosperity. Technology innovators and venture capitalists were acquiring sudden fortunes, buying up McMansions like the ones I had cleaned in Maine and much larger. Even secretaries in some high-tech firms were striking it rich with their stock options. There was loose talk about a permanent conquest of the business cycle, and a sassy new spirit infecting American capitalism. In San Francisco, a billboard for an e-trading firm proclaimed, "Make love not war," and then—down at the bottom—"Screw it, just make money."

When Nickel and Dimed was published in May 2001, cracks were appearing in the dot-com bubble and the stock market had begun to falter, but the book still evidently came as a surprise, even a revelation, to many. Again and again, in that first year or two after publication, people came up to me and opened with the words, "I never thought…" or "I hadn't realized…"

To my own amazement, Nickel and Dimed quickly ascended to the bestseller list and began winning awards. Criticisms, too, have accumulated over the years. But for the most part, the book has been far better received than I could have imagined it would be, with an impact extending well into the more comfortable classes. A Florida woman wrote to tell me that, before reading it, she'd always been annoyed at the poor for what she saw as their self-inflicted obesity. Now she understood that a healthy diet wasn't always an option. And if I had a quarter for every person who's told me he or she now tipped more generously, I would be able to start my own foundation.

Even more gratifying to me, the book has been widely read among low-wage workers. In the last few years, hundreds of people have written to tell me their stories: the mother of a newborn infant whose electricity had just been turned off, the woman who had just been given a diagnosis of cancer and has no health insurance, the newly homeless man who writes from a library computer...

[Demeter]

56. Overworked America: 12 Charts That Will Make Your Blood Boil

http://motherjones.com/politics/2011/06/speedup-americans-working-harder-charts

[Demeter]

57. Number of ‘mass layoffs’ jumps up 3 percent

http://www.rawstory.com/rawreplay/2011/09/number-of-mass-layoffs-jumps-up-3-percent/

[DemReadingDU]

59. good morning

oops, wrong day