STOCK MARKET WATCH, Monday June 16

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday June 16, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 219
DAYS SINCE DEMOCRACY DIED (12/12/00) 2703 DAYS
WHERE'S OSAMA BIN-LADEN? 2428 DAYS
DAYS SINCE ENRON COLLAPSE = 2719
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

AT THE CLOSING BELL ON June 13, 2008

Dow... 12,307.35 +165.77 (+1.35%)
Nasdaq... 2,454.50 +50.15 (+2.09%)
S&P 500... 1,360.03 +20.16 (+1.50%)
Gold future... 873.10 +1.10 (+0.13%)
30-Year Bond 4.80% +0.04 (+0.80%)
10-Yr Bond... 4.26% +0.06 (+1.33%)






GOLD,EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

---

Read more: du

[ozymandius]

1. Market WrapUp: Another Tim Wood Dow Theory Non-Confirmation

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

[TalkingDog]

5. I see........... ....... .......

Take stock of tightening ahead:
http://www.reuters.com/article/companyNewsAndPR/idUSSP15544020080616


Financial markets battered last week by ramped-up anti-inflation talk from the world's two most powerful central banks can take stock this week of just how aggressive the monetary tightening might be.

While future rate rises by the European Central Bank and the U.S. Federal Reserve would embolden rate setters elsewhere to follow suit, nagging worries about a slowdown in economic growth may well keep the policy makers and markets cautious.

The U.S. dollar is expected to feel the cross winds of these competing view points early in the week after the world's richest nations failed to endorse a stronger dollar in a meeting of their finance ministers at the weekend in Osaka, Japan.

snip:

"The result of the G8 was a disappointment, with ministers saying they did not discuss currencies. The dollar is likely to start lower on Monday," said Minoru Shioiri, chief manager of foreign exchange trading at Mitsubishi UFJ Securities in Tokyo.



But any U.S. dollar downside may well be limited because the U.S. Federal Reserve now seems poised to raise interest rates, adding to the appeal of investing in U.S. assets, bankers said.



and why does Reuters have a picture of a casino dealer on their financial pages.....

[ozymandius]

8. Did you read Tim Wood's column?

If you did - that makes one of us. I stopped reading his drivel long ago. The link is merely posted for the sake of daily consistency in posting the WrapUp.

[TalkingDog]

15. I can honestly say my eyes went across the words.

I understood them. Some sections even made sense in terms of conveying an idea.

But, being a visual/kinesthetic learner, unless it has some connection to a concrete reality I've experienced, I can't fully grasp it without A)analogies or B) pictures, and preferably both.

So, for example, I can "understand" the concepts of fractal geometry, but when you tell me that the US military developed the algorithms in WWII in order to more quickly create maps of coastlines because natural forms, like cyclones, galaxy spirals, growth patterns of pine cones and DNA, have a tendency to repeat over a very wide scale, then.... I feel it in my center and I "know" it.

Tim.... not so much.

But being a lover of consistency, I appreciate your efforts. And in order to show that, I dutifully attempt to eat what you put on the plate. I was never a child that refused broccoli or liver "just because". How do you know what you'll like (or learn) unless you try it?

[Ghost Dog]

46. He says that

"...to date nothing has occurred to negate the bearish primary trend change that occurred on November 21, 2007. ... So, the bottom line from a Dow theory perspective is that we now have a Dow theory upside non-confirmation in addition to the bearish primary trend change that was established on November 21, 2007. ... caution is advised!"

:hi:

[Dr.Phool]

48. Does that mean what I think it means?

[Ghost Dog]

59. Does this guy really keep his head up his charts, without a glance at the real

or the fantasy worlds the rest of us see?

However, he's saying he's seeing nothing in his charts that tells him this ain't a BEAR.

[Robbien]

72. A Dow Theory Upside Non-Confirmation?

What? The man is going to break out in boils if he actually says the words there's no hope in sight for Wall Street?

[specimenfred1984]

77. I read it! I read it! (Ooooo, oooo, raises hand anxiously)

He said that based on his 1930s theory that he's conned people into making a living off of, absolutely nothing can be clearly said about anything! From the article:

"there is not sufficient evidence in accordance with classical Dow theory, to determine if we are still operating within the context of a longer-term bull market or if we have indeed moved into the early stages of a long term bear market."

No evidence of anything in any direction, Weeeeeeeeeeeeeee!

[Ghost Dog]

68. GLOBAL MARKETS WEEKAHEAD-Take stock of tightening ahead

Mon Jun 16, 2008 2:00am EDT
By Neil Fullick

SINGAPORE, June 15 (Reuters) - Financial markets battered last week by ramped-up anti-inflation talk from the world's two most powerful central banks can take stock this week of just how aggressive the monetary tightening might be.

While future rate rises by the European Central Bank and the U.S. Federal Reserve would embolden rate setters elsewhere to follow suit, nagging worries about a slowdown in economic growth may well keep the policy makers and markets cautious.

The U.S. dollar is expected to feel the cross winds of these competing view points early in the week after the world's richest nations failed to endorse a stronger dollar in a meeting of their finance ministers at the weekend in Osaka, Japan.

The dollar has been linked to rising prices because some, including France's Economy Minister Christine Lagarde, argue speculators are putting their money into commodities like oil to hedge against long-term weakness in the currency.

"The result of the G8 was a disappointment, with ministers saying they did not discuss currencies. The dollar is likely to start lower on Monday," said Minoru Shioiri, chief manager of foreign exchange trading at Mitsubishi UFJ Securities in Tokyo.

But any U.S. dollar downside may well be limited because the U.S. Federal Reserve now seems poised to raise interest rates, adding to the appeal of investing in U.S. assets, bankers said.

"The dollar's fall will be gradual because views for higher U.S. interest rates and rising Treasury yields, bigger factors behind the dollar's recent rise, are still intact," said Tohru Sasaki, chief foreign exchange strategist at JPMorgan Chase in Tokyo.

/... http://www.reuters.com/article/marketsNews/idINSP15544020080616?rpc=44&sp=true

[ozymandius]

2. Today's Reports

08:30 NY Empire State Index Jun
Briefing.com 0.0
Consensus -2.4
Prior -3.2

09:00 Net Foreign Purchases Apr
Briefing.com NA
Consensus NA
Prior $80.4B

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

[UpInArms]

39. U.S. June Empire State index -8.7 vs. -3.2 in May

03. U.S. June Empire State index -8.7 vs. -3.2 in May
8:30 AM ET, Jun 16, 2008

[Dr.Phool]

41. That's a hell of a contraction.

I wonder how they'll spin this.

[ozymandius]

43. I'm sure some economist wearing a clown hat and high-heeled swim fins

will declare this number is not as bad as "some" projections. So happy days all!

Just watch.

[UpInArms]

51. US April net capital inflows $60.6 bln

http://www.reuters.com/article/bondsNews/idUSWAT00966720080616

 WASHINGTON, June 16 (Reuters) - Treasury Department
international capital (TIC) data release, in billions of
dollars except where noted. Figures are not seasonally
adjusted.
                     April    March     Feb
Monthly Net
TIC Flows              $ 60.6     -48.7    49.2
  Private              $ 31.5     -58.1    58.7
  Official             $ 29.1       9.3    -9.5
Net foreign buys of
long-term securities   $102.8      53.3    49.6
  Stock swaps, other   $-12.3     -26.3   -15.4
Long-term securities
  transactions         $115.1      79.6    64.9
Domestic Securities,
purchased net          $104.8      78.6    77.9
  Private              $ 63.5      30.5    71.1
  Official             $ 41.3      48.1     6.7
Total net foreign buys of:
Treasuries               80.28    53.63    20.60
Agencies                 15.27    18.74    36.90
Equities                -15.86    10.77     1.11
Corporates               25.09    -4.58    19.25
Holdings of major foreign
 holders of Treasuries:
Japan                   592.2     600.7    586.6
China                   502.0     490.6    486.9
United Kingdom          251.4     202.9    181.4
Oil exporters           153.9     150.8    146.1
Brazil                  149.5     149.1    146.6

[tama]

90. UK

UK buying 50 billion in April!!!

[ozymandius]

3. Oil prices steady ahead of Saudi meeting

VIENNA, Austria - Oil prices held steady Monday as traders weighed Saudi plans to boost production and new OPEC concerns about the high costs of crude.

Light, sweet crude for July delivery rose 76 cents to $135.62 a barrel in electronic trading on the New York Mercantile Exchange by noon in Europe. It fell $1.88 to settle at $134.86 on Friday.

Saudi Arabia, the world's largest oil producer, told U.N. chief Ban Ki-moon over the weekend that it would boost output by 200,000 barrels a day, or by 2 percent, from June to July. In May, the kingdom raised production by 300,000 barrels a day. That appeared to be largely ignored by traders amid sustained global demand.

However, traders believe that there is growing concern within the Organization of Petroleum Exporting Countries that high prices will suppress the global appetite for oil, and that the organization may take action to stabilize the market.

.....

Phil Flynn, an analyst at Alaron Trading Corp. in Chicago, said the revised forecasts suggest global demand for oil is slowing. That trend could accelerate, he added, if prices don't come down soon.

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

[ozymandius]

4. Congress wary of oil-market speculation

Washington - As energy prices soar, Congress is under the gun to find a way out for American consumers – or, failing that, someone to blame: Big Oil, speculators, or the other political party.

Oil companies dodged a bullet in the Senate this week, as Republicans blocked an energy bill that would have imposed a windfall profits tax on them and ended billions in tax breaks. But Democrats, who control both the House and Senate, plan to bring the issue up again, even as bipartisan scrutiny shifts to the role of speculators in contributing to sticker shock at the pump.

The Senate bill, which fell nine votes short on a procedural vote, proposed a 25 percent windfall profits tax for companies that made more than 10 percent above a past average. It also would have created an Energy Independence and Security Trust Fund – and used the $17 billion in discontinued Big Oil tax breaks to fund it.

.....

Even before the Senate bill fell to defeat, some Democratic and Republican lawmakers were lining up behind provisions to curb speculation by raising margin requirements for those investing in futures trades and banning traders from using offshore futures markets to evade regulation.

http://www.csmonitor.com/2008/0613/p03s09-uspo.html

[Ghost Dog]

66. MF to probe oil market, speculators’ role

Published: Monday, 16 June, 2008, 07:11 AM Doha Time

OSAKA: The International Monetary Fund said yesterday it would investigate the surge in crude oil costs after the G8 club of rich nations called for a probe into wild swings in energy prices.

The fund’s chief Dominique Strauss-Kahn said tight demand and supply conditions were the key reason for soaring oil prices, which are up fivefold since 2003, but added that may not be thought to explain all the surge.

“One may think some financial considerations are at stake and that’s the reason why the G8 asked the IMF to work for the next meeting... in October to produce a report on this question,” he told reporters. He said some members of the Group of Eight (G8) thought that “probably there would be some influence of financial factors, let’s call it speculation if you want,” while others disagreed. “It’s totally unclear so we need to have this study to answer this question,” he said, after the G8 ended two days of talks about the economic threat from a doubling of food prices in three years and sky-high oil costs.

The ministers in their communique asked the IMF and International Energy Agency to investigate the “real and financial factors behind the recent surge in oil prices and volatility, and the effects on the global economy.”

/... http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=224369&version=1&template_id=48&parent_id=28

[UpInArms]

17. Oil falls as Saudi pushing output to highest since '81

http://news.yahoo.com/s/nm/markets_oil_dc

SINGAPORE (Reuters) - Oil fell more than a dollar to below $134 on Monday as Saudi Arabia prepared to push production to its highest rate in decades, moving to soothe the market ahead of this weekend's crisis meeting over record prices.

U.S. light, sweet crude for July delivery was down 85 cents at $134.01 a barrel by 2:45 a.m. EDT, after falling as much as $1.40 a barrel, or about 1 percent, earlier in the session.

The contract dropped nearly $2 on Friday, when an industry newsletter reported that Saudi was poised for a big output boost.

London Brent crude fell 61 cents to $134.50 a barrel.

At the weekend, United Nations chief Ban Ki-moon said the world's biggest exporter was set to increase output to 9.7 million barrels per day in July, the first official indication of its second supply boost in as many months.

"9.7, that is what he (Saudi Oil Minister Ali al-Naimi) said" on July output, the Abu Dhabi-based The National newspaper quoted the U.N. Secretary General as saying after he met with Naimi.

That would be a rise of 550,000 bpd or over 6 percent since May and would take Saudi crude output to its highest monthly rate since August 1981, according to U.S. government data.

...more...

[UpInArms]

36. July crude up $1.02 at $135.87 a barrel in electronic trade

04. July crude up $1.02 at $135.87 a barrel in electronic trade
8:19 AM ET, Jun 16, 2008

[ozymandius]

38. Energy Bubble Will Burn Bulls Just Like Tech Did, Says Top Investor Herro

David Herro, Harris Associates' chief investment officer (international) wasn't named one of SmartMoney's "World's Greatest Investors" of 2007 by following the crowd.

.....

Supply/demand fundamentals simply don't support oil at current prices, he says, predicting crude will tumble back into the $60-$80 per barrel range in the next 24 months.

..very short article; a video embellishes the story..

http://finance.yahoo.com/tech-ticker/article/27862/Energy-Bubble-Will-Burn-Bulls-Just-Like-Tech-Did-Says-Top-Investor-Herro?tickers=XLF,XLE,GM,F,OIL,USO,DUG

[AnneD]

74. Morning Marketeers.....

:donut: and lurkers. I took a brief week's time off to rest a bit and take care of a few odds and ends. As a result, I was out and about town at odd hours. What I saw was very revealing.
The city buses are backed-more so than I have ever seen them. Even off peak hours are crowded. In fact Metro, who already had 75 new buses ordered will put them on the park and ride routes (which have been SRO for a while now). I see many more bike riders and families walking, and that is a good thing. At hubbies work, they will be giving them a bit of an increase in pay to offset the gas cost. I am sure with the flooding in Iowa, corn, soybeans, and ethanol will shoot up. I can only imagine what the first hurricane in the gulf will do to it.

But the strangest thing is as it get closer to 9 or 10 pm here in Houston. I live right off Main St., near the medical center. There has always been traffic at all hours. But now the streets seem to roll up after 8:30. If I had to compare traffic levels, I would say we are to 1978-79 levels...about the time of the oil embargo. I save most of my travel and shopping until later at night because it is cooler so it creeps me out a bit-like some sort of SF movie where most of the population is gone-a post apocalyptic scenario. Gas is pretty much at $4 or touching it. I found a spot where it is 3.85 so I fill up there when I run an errand out there. I am still heading out to church on Sunday and combine it with a farmer's market run, but our driving patterns have changed. I have a schedule now and do things on different days to accommodate my schedule. I have cleaned out my car and trunk and just hold the necessities to lighten the load so to speak. Now I know if I am doing that and I am doing better than most folks, I can only guess what others are doing.

I am bummed out a bit. We were thinking about retiring to Iowa, had even been looking at some nice old homes in Ceder Rapids. Guess that might be off my list now. I don't trust those 100 or 500 year flood plain maps-I guess living in Houston has jaded me a bit. With the climate changes, these things may happen more often. Well, I guess I will still be searching for a nice geologically stable area, although I was quite take with Iowa.

I did get to follow some of the WS shenanigans this last week. They keep ginning things up for those sucker rallies. I hope you folks all have stop losses on your stocks by now. I still believe in my heart of hearts that we will go lower, this is a recession that has the potential to go into a depression and if God is just, the Bush Admin will go out with at least egg on their face (my preference is tar and feathers though).

Happy hunting and watch out for the bears.

[kineneb]

80. seconded

Report from the rural Left Coast:

Gas runs between $4.50-4.75 most of the time. The Tower Marts have the best prices.

Since I am not working (officially), I stay at home much of the time. Being a piano teacher means my commute is generally across the house, to my little studio, unless my student has made prior arrangements. If I need something or to run errands, I do all my driving around on one day. My bicycle is all repaired and has the European-style saddle bags on the rack, so I can carry things, if needed.

I have noticed more people waiting for the local buses...and found out that the local towing business is way down- people can't afford to drive their junkers, so they are not needing to be towed from breaking down as much. People know something is happening, and are battening down the hatches.

There still seems to be tourist traffic, but not as many out-of-state cars. I get the feeling some people are traveling now, because they know gas will only get more expensive. I know that is my plan.
---

I have been taking breaks from politics and the economic news; when the mess starts giving me the beginning of a panic attack, I know it is time to go play elsewhere. So I have been hanging out on a free internet dating site...wish me luck.

[Ghost Dog]

84. Thanks for the grassroots news, folks. Businesses battening-down here too

due to drop in tourist trade ('though it is normal low season right now).

Good luck kineneb. Post a photo here why don't ya? :evilgrin:

[Theres-a]

89. When I take breaks

I go to Icanhascheezburger and Ihashotdog.It's hard to be too angry and/or freked out and laugh hysterically at the same time! Good luck dating!

[UpInArms]

92. oh those were grand links!

[UpInArms]

50. Crude oil hits new record high of $139.89 a barrel

06. Crude oil hits new record high of $139.89 a barrel
8:56 AM ET, Jun 16, 2008

[TalkingDog]

6. Re: Cartoon

Nice, subtle reference to the "hanging chad" over on the right.

[DemReadingDU]

11. ah, Good toon

I see the "hanging chad" reference

:)

[ozymandius]

7. Oil and Food Prices Add to Inflation Pressures

Inflation hit harder in May as prices for a wide swath of consumer goods rose at their fastest pace in six months, underscoring warnings from central bankers and adding to a growing consensus that the Federal Reserve might raise interest rates by the end of the year.

The Consumer Price Index, which measures prices of a batch of common household products, rose 0.6 percent last month, as Americans were forced to cope with a sharp increase in fuel costs. The report, released Friday by the Labor Department, is considered a benchmark measure of inflation.

On an annual basis, inflation worsened for the first time in four months, running at 4.2 percent in May compared with a year ago.

The index, which rose more than economists had forecast, comes on the heels of repeated warnings about inflation from the world’s central banks. The chairman of the Fed, Ben S. Bernanke, joined other bank officials this week in focusing on higher prices, citing the economic damage wrought by the record run-up in food and oil prices.

The speeches have fueled a growing sense on Wall Street that the Fed has shifted its focus from supporting growth to fighting inflation. The May C.P.I. helped heighten expectations that higher interest rates, which tend to hold down prices, may be in the offing.

http://www.nytimes.com/2008/06/14/business/14econ.html?_r=1&hp&oref=slogin

[Ghost Dog]

53. European Inflation Accelerates to Highest in 16 Years

June 16 (Bloomberg) -- European inflation accelerated to the highest in 16 years last month as food and energy costs soared, intensifying what finance ministers from the world's richest nations said is becoming a ``more complicated'' dilemma.

The inflation rate in the euro area rose to 3.7 percent, the highest since June 1992, from 3.3 percent in April, the European Union's statistics office in Luxembourg said today. The rate for May is higher than the 3.6 percent estimate published on May 30.

Soaring commodity prices have pushed up costs for companies and consumers and at the same time are posing a ``serious challenge'' to economic growth, officials from the Group of Eight nations said yesterday after a meeting in Japan. European Central Bank President Jean-Claude Trichet this month said the ECB may raise its benchmark interest rate a quarter point in July, signaling he is setting aside concerns about the economy's expansion to combat inflation.

/... http://www.bloomberg.com/apps/news?pid=20601085&sid=akkyzsJZBKG0&refer=europe

[ozymandius]

9. AP IMPACT: CEO pay chugs up in '07 despite economy

NEW YORK - As the American economy slowed to a crawl and stockholders watched their money evaporate, CEO pay still chugged to yet more dizzying heights last year, an Associated Press analysis shows.

The AP review of compensation for the heads of companies in the Standard & Poor's 500 index finds the median pay package added up to nearly $8.4 million. That's a comfortable gain of about $280,000 from 2006.

The 3 1/2 percent pay increase for CEOs came even as the landscape for both workers and shareholders darkened considerably and the economy was choked by a housing market in free fall, layoffs and soaring prices for fuel and food.

At the top of the AP list: John Thain, who took the reins of Merrill Lynch on Dec. 1, 2007. His $83 million pay package was supercharged by a signing bonus and other enticements that lured him from the New York Stock Exchange to lead the investment bank as it was suffering its worst-ever losses.

Collectively, the 10 best-paid CEOs made more than half a billion dollars last year. Yet half the members of this stratospheric club were leading companies whose profits shrank dramatically.

http://news.yahoo.com/s/ap/20080615/ap_on_bi_ge/executive_compensation

[UpInArms]

28. Merrill's Thain was highest-paid CEO in 2007: report (top 10 list with $$$$)

http://www.marketwatch.com/news/story/merrill-lynchs-thain-tops-ceo/story.aspx?guid=%7B541D1546%2D26B2%2D4CF6%2D9C60%2DD3DE508B093E%7D

snipping to the list:

The top 10 earning CEOs were as follows:

1. John Thain, Merrill Lynch, $83.1 million

2. Leslie Moonves, CBS Corp., $67.6 million

3. Richard Adkerson, Freeport-McMoran Copper & Gold Inc. (FCX) , $65.3 million

4. Bob Simpson, XTO Energy Inc. (XTO) , $56.6 million

5. Lloyd Blankfein, Goldman Sachs Group Inc. (GS) , $53.9 million

6. Kenneth Chenault, American Express Co. (AXP) , $51.7 million

7. Eugene Isenberg, Nabors Industries Ltd. (NBR) , $44.6 million

8. John Mack, Morgan Stanley (MS) , $41.7 million

9. Glenn Murphy, Gap Inc. (GPS) , $39.1 million

10. Ray Irani, Occidental Petroleum Corp. (OXY) , $34.2 million

...more at link...

[ozymandius]

10. AIG board names Willumstad as new CEO

NEW YORK - American International Group Inc., which has lost billions on bad bets on the mortgage market, on Sunday named former Citigroup Inc. executive Robert Willumstad to replace the insurer's besieged chief executive.

Willumstad, 62, will take over from Martin Sullivan, 53, effective immediately, the company said. Stephen Bollenbach, the former CEO of Hilton Hotels Corp., will be named AIG's lead director.

AIG named Willumstad chairman of the board in fall 2006, about a year after Willumstad left his post as president and chief operating officer at Citigroup. Citigroup had passed him over for the CEO job — which went instead to the now-dethroned Charles Prince.

Sullivan, a native of England who had worked with AIG for 37 years, now joins the long list of CEOs who have been pushed out since the credit crisis started slamming the financial services industry last year. That list includes Citigroup's Charles Prince, Merrill Lynch & Co.'s Stanley O'Neal and Wachovia Corp.'s Ken Thompson.

New York-based AIG — the world's biggest insurer with $1.05 trillion in assets — lost $7.8 billion during the first quarter of the year due to investments and contracts tied to bad loans. The insurer's first-quarter deficit was even more massive than its fourth-quarter loss of more than $5 billion. After its two straight quarterly losses, AIG revealed plans to raise $20 billion in fresh capital — but investors reacted skeptically, unsure that extra cash would solve the insurer's problems.

http://news.yahoo.com/s/ap/20080616/ap_on_bi_ge/aig_ceo

[ozymandius]

16. Willumstad Says `Nothing Off Table' in Plan for AIG (Update2)

June 16 (Bloomberg) -- Robert Willumstad, American International Group Inc.'s new chief executive officer, says ``nothing is off the table'' as he tries to win back shareholders' confidence in the world's biggest insurer.

Willumstad, who replaced Martin Sullivan as CEO yesterday after record losses tied to subprime loans, said he plans to review all of AIG's operations, which include offices in more than 100 countries and more than $45 billion of hard-to-value assets. AIG gained 4 cents to $34.22 in German trading.

``I've set a goal in the next 90 days to dig into the businesses, all of the businesses, not just the non-insurance businesses, to make sure our capital is being employed in the right areas,'' Willumstad, 62, said in an interview. ``If there are businesses that are hampered in terms of their growth, or strategically we're not as competitive in some areas, we'll take a hard look.''

.....
In addition to selling life insurance and protecting property, AIG owns or manages about $25 billion of real estate, including residential, industrial and retail properties. The company had private equity and hedge fund holdings of $29.4 billion as of March 31 and owns International Lease Finance Corp., the largest lessor of planes to airlines.

AIG may have ``gotten to the point that it has a size issue,'' said Keith Wirtz, president of Fifth Third Asset Management in Cincinnati, which manages $23 billion including AIG shares. ``Have you gotten so big, you can't replicate the growth rates you've had in the past?''

http://www.bloomberg.com/apps/news?pid=20601087&sid=aXxihCOSR9BQ&refer=home

[UpInArms]

12. dollar watch

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

Last trade 73.852 Change -0.210 (-0.28%)

Dollar: Will The Rally Continue to 1.50?

http://www.dailyfx.com/story/topheadline/Dollar__Will_The_Rally_Continue_1213566919292.html

The greenback put up its best week in 3 years rallying nearly 5 big figures in five days as market expectations regarding US interest rates changed dramatically. As we noted in our special report Fed Rate Hike Ready or Not regarding Chairman Bernanke uber hawkish remarks last week, “This was a tremendous change in tone from the Fed Chairman who for the past 18 months has spent most of his energy combating the negative economic effects of the housing bust and the credit crunch by methodically lowering rates from 5.25% to 2.00%. Clearly the game has changed and the Fed now felt that inflation was a bigger problem than growth for the US economy.”

Inflation of course is being driven by oil and the Fed has taken square aim at crude by suggesting that US monetary policy will become restrictive in order to retrain the rising prices of petroleum. This week-end’s G-8 meeting addressed the same issue with member nations providing a strongly worded communiqué asking oil producers to put out more product. In response reports out of Saudi Arabia indicate that the swing OPEC state has agreed to pump out an extra 500K/bbl per day. If that report proves true and manages to push oil process below $130/bbl the greenback should strengthen further at the start of trade next week. G-8 however, shied away from any overt language regarding exchange rates, leaving US Secretary of Treasury Paulson to simply reiterate the well worn mantra that US is committed to a strong dollar.

Next week the calendar contains only 2nd tier economic data with only PPI release having much of an impact on the market. In short, the macro factors that drove trade last week as likely to continue to play an important part this week with all eyes focused on oil prices. The greenback had a powerful change of turn last week and unless US data produces major negative surprises in the smattering of Industrial gauges due this week, the path of least resistance in the EURUSD appear to be down. -BS



...more...

Dollar Uncertain After G-8 – Where to Next?

http://www.dailyfx.com/story/bio2/Dollar_Uncertain_After_G_8___1213608456164.html

The G-8 meeting concluded over the week-end without making any overt references to support the dollar in its communiqué and as a result the buck opened weaker at the start of trade on Monday. The EURUSD popped up above 1.5400 on a small gap open in Asia, drifted lower to 1.5345 and then regained its footing trading well above 1.5400 by mid morning of the European session.

The pair is being pushed and pulled in opposite directions as the relief from lack of any apparent G-8 intervention on the behalf of the dollar is offset by the lingering concerns over Ireland’s rejection of the European constitution on Friday. As we noted in our weekly, quoting our colleague Kathy Lien, “As the European Union’s second attempt at a constitutional treaty, in some ways it deals a significant blow to the EU but in some ways, it does not. Recall what happened in 2005 when the French and the Dutch rejected the proposed EU Constitution Treaty. The Euro weakened, there was a lot of panic and fear about the viability of the single currency but eventually, the Euro erased all of its gains and then some when traders realized that the single currency is here to stay. The same can be said this time around. The EU Constitution is at risk and not the European Monetary Union.“

Thus, the FX impact of the Irish “no” vote is likely to be limited and trading focus this week should once again return to economic data. To that end, today’ s EZ CPI numbers sent a mixed message as well with core printing slightly below expectations at 1.7% versus 1.8% while headline numbers rose to 3.7% versus 3.6% forecast. The report therefore provided few clues as to possible ECB action next month as it offered valid arguments for both keeping rates steady and hiking them.

Nevertheless, given the increasing political tension within the EZ we remain highly skeptical that ECB will actually make good on its promise to hike rates further. Yet, since monetary authorities in the region do not face direct political accountability they may ignore the cries of protest from the union’s southern members and choose to err on the side of price stability. The key factor in ECB’s decision making process will be the price of oil. Given the fact that headline pressures are almost exclusively driven by energy costs (which in turn increase food and other costs in the system), if price of oil drops to below $130/bbl the ECB may choose to pass. Therefore, the most important variable driving trade in FX this week may not come from the economic calendar but from the pits of NYMEX.

...more...

[ozymandius]

13. U.S. seeks Swiss help in UBS tax evasion probe

ZURICH (Reuters) - U.S. authorities have sought legal assistance from Switzerland's Federal Office of Justice in an investigation into tax evasion through offshore bank accounts at UBS (UBSN.VX), Swiss media reported on Sunday.

Swiss newspaper SonntagsZeitung reported that Swiss authorities were looking into the request for possible legal and administrative assistance.

Swiss law does not allow banks to give out information on their clients except in cases of tax fraud.

http://news.yahoo.com/s/nm/20080615/bs_nm/ubs_dc

[ozymandius]

14. Paulson says strong dollar in US interests (while wearing fake nose-and-glasses)

OSAKA (AFP) - US Treasury Secretary Henry Paulson said Saturday a strong dollar was in his nation's interests and solid US economic fundamentals would support the currency in the long term.

"With regard to the dollar, my view has not changed: a strong dollar is in our nation's interest," he told a press conference after a meeting of Group of Eight finance ministers here.

Traders say that Washington appears to have been ratcheting up the rhetoric recently to talk up the US currency so as to keep a lid on inflation and limit the need for higher interest rate hikes that could stifle economic growth.

.....

There has been speculation among currency traders that the G8 may consider a foray onto the market to prop up the dollar if it comes under renewed selling pressure, but Paulson sidestepped a question about possible intervention.

http://news.yahoo.com/s/afp/20080614/bs_afp/g8economyforexpaulson

edit: What a clown. He spews this bile and expects people to believe him.

[UpInArms]

18. N.Y. Fed's private OTC actions under fire

http://www.reuters.com/article/newsOne/idUSN1543260720080615?sp=true

WASHINGTON (Reuters) - The New York Federal Reserve's closed-door rule making with top players in the massive $60 trillion credit default swaps market came under legal fire on Sunday, as a fair finance activist filed a complaint questioning why it was done in the dark.

"The Federal Reserve seems to think it can engage in rule making in secret only with the industry," said Matthew Lee, executive director of the New York-based non-profit group Inner City Press/Community on the Move.

Lee filed the administrative complaint on Sunday with both the New York Fed and the Federal Reserve Board in Washington. In the complaint, he demanded that the central bankers explain why the meetings earlier this month were private and requested copies of all communications and details about the New York Fed-sponsored talks.

Officials at the Federal Reserve could not immediately be reached for comment.

The meetings were held with more than a dozen companies led by investment bank Goldman Sachs Group Inc. The companies -- which account for the bulk of business in the $60 trillion market -- met to help set new rules for credit default swaps trading, including the establishment of a clearinghouse.

Credit default swaps are privately negotiated transactions used by companies to hedge against default risks. Over the past decade, the market has grown exponentially, from about $1 trillion to $60 trillion.

Lee, referring to the Fed-led rescue of investment bank Bear Stearns by JPMorgan Chase & Co, said, "It was one thing to bail out Bear Stearns without any comments from the public. Now the Fed is trying to bail out or benefit 17 of the largest financial institutions behind closed doors."

Citing the federal Administrative Procedures Act, he said it was illegal to have conducted the meetings.

...more...

[TalkingDog]

19. The Financial Times wants to send us to bed without supper.

http://www.ft.com/cms/s/0/1c8c3ed4-3b02-11dd-b1a1-0000779fd2ac.html?nclick_check=1

Even if the UK escapes a recession, the coming years are almost certain to be more painful than any since 1992: the financial system is under severe stress; room for fiscal manoeuvre has disappeared; and inflation is above target. But the economy can still travel through, provided people keep their heads.

snip:

The household sector is in a particularly poor position. The weak pay growth may be good news for the Bank’s monetary policy committee. But it has been accompanied by sharp rises in living costs. With banks reluctant to lend, many consumers will find it difficult to sustain their spending. However, consumption has been falling as a share of output since 2003.

snip:

Yet whether aggregate growth of incomes is slightly positive may make surprisingly little difference to how many people feel. Most households are experiencing rising prices of energy, food and other imported products, as a direct result of global price shocks and the falling external value of the pound. Meanwhile, the interest rates they pay on their mortgages are now far more likely to rise than fall.

The combination of weak growth of incomes with jumping prices will come as a shock, partly because more than a third of the working-age population has never experienced a recession, or even a significant slowdown, as adults. For them, the coming months will offer a painfully steep learning curve.



Edited to add: Off to check on the plants I had to put in by moonlight (ran out of day). Have fun, I'll see you guys later on.

[Ghost Dog]

58. Here ya go: King Faces Test on U.K. Inflation as Economy Skirts Recession

June 16 (Bloomberg) -- Bank of England Governor Mervyn King may be forced to explain to the government why he no longer has the scope to cut interest rates to stave off a recession.

Inflation probably reached 3.2 percent in May, the most since the measure's inception in 1997, the median of 39 forecasts in a Bloomberg News survey show. A rate that high requires King by law to write a letter of explanation to the Treasury. The statistics office will publish the data tomorrow at 9:30 a.m. in London.

King's challenge is to protect the bank's inflation-fighting credentials as oil and food costs rise at a record pace and economic growth stumbles. The economy is heading for its worst performance since 1992, according to forecasts released today by the Confederation of British Industry.

``People are losing faith in the Bank of England's ability to keep inflation low,'' said Michael Saunders, chief Western European economist at Citigroup Inc. in London. ``That's why the idea of cutting rates is off the agenda. Central banks have this problem in common, but in the U.K. it seems particularly large.''

At 5 percent, Britain's interest rate is the highest in the Group of Seven industrialized nations. U.K. inflation is also lower, at 3 percent in April, compared with 3.9 percent in the U.S. and 3.6 percent in May for the euro region.

/... http://www.bloomberg.com/apps/news?pid=20601068&sid=aO9InoSiKlEk&refer=economy

(Rucola, spinach, carrots, peppers doing well here; insects in the lettuce, will spray with "nicotine (cig. butt) tea"; melons coming on, but slowly; local organic tomatoes and potatoes about to go in the ground; Mature Lime tree full of fruit and young seville & mandarin orange, lemon and avocado trees putting out fresh new leaves. Maria transplanted into larger pots (& snipped and tested: mmmm). Back home from the road & all is at peace with the sunny world, but need to prune the shade trees).

[TalkingDog]

63. I use tobacco tea, but because I want my bugs really, really dead

I add a garlic/mineral oil/soap mixture with neem oil and diatomaceous earth. Covering all bases here.....

Yet I'm still struggling with the freakin' squash (shield/stink) bugs.

[Ghost Dog]

70. Jeesus, things would have to be really serious before I'd add a drop of the reserve diesel

supply. Soap, yes, and I'll try garlic too. Lavender growing interspersed works well for the herbs. I'll have to look up the neem oil and thingumyjig earth.

I knew I was missing something: Calabacín (squash?) and berenjena (aubergine, edit, eggplant).

[AnneD]

76. Diatomaceous earth

is actually fossilized diatoms and other hard shelled algae, most from the cretacious....I use to work with paleontologist. Must have been one hell of a lot of them (it's what makes up chalk too). It is good foor killing fleas too. I like the natural pesticides and intersperce herbs with my veggies. My lavender is now 3 years old and I have had nary a bug around them and my vicks plant is so prolific as to almost take over the plants they are protecting. Since I don't have much land, I container garden. the heirloom tomatoes are doing well, but it is so hot here I have to water them 2x a day. The peppers are great and the onions are doing well. I have more herbs than I can cook with. Wish I could have a bit more land to plant(sigh).

[tama]

91. Nettle water

Have you tried soaking stinging nettles in water for day or two and then spraying plants with the nettle water?

Nice soup or pancakes also, many uses: http://en.wikipedia.org/wiki/Stinging_nettle

Planting marigold (tagetes and calencula officinalis) here and there around the garden also helps a lot, as they are natural vermin repellents.

Keep it natural!

[ozymandius]

20. Corn Jumps to Record as Floods in Midwest Threaten U.S. Crops

June 16 (Bloomberg) -- Corn climbed to a record near $8 a bushel as storms pounded crops in the U.S., the largest producer and exporter, and caused what may be the worst flooding in the Midwest since 1993.

Corn rose as much as 3.5 percent, and soybeans, wheat and rice all gained. The flooding in the Midwest will probably cause ``hundreds of millions of dollars'' of damage, according to the National Weather Service. U.S. corn stockpiles may fall 53 percent to a 13-year low before next year's harvest, the U.S. Department of Agriculture said June 10.

The United Nations estimates global food imports will exceed $1 trillion for the first time this year. In Egypt, the most populous nation in the Middle East, bread subsidies account for 5.5 percent of the national budget. Mexico, Yemen and 31 other nations face social unrest because of spiraling food and energy costs, the World Bank says.

High food prices ``are here to stay'' as governments divert resources to make biofuels, amass stockpiles and limit exports, Peter Brabeck-Letmathe, chairman of Nestle SA, the world's largest food company, said in an interview in Kuala Lumpur today.

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=a90sawksxmcg

This is institutionalized insanity. To divert food supplies to make car fuel cannot be justified. The utter selfishness boggles my mind to wonder how we have sunk to such a sorry state.

[Tansy_Gold]

55. I am very fortunate

I know I whine here a lot about my sorry state of financial affairs, but in truth, I've been pretty fortunate in that I have the flexibility to control at least part of my outlay of cash.

One way is by curbing driving. And it hasn't been either difficult or painful, yet I've cut my gasoline consumption in half over the past couple of months. I have no access to public transportation -- there isn't any here at all -- and I'm 2.5 miles from the nearest retail grocery outlet, 5.0 miles from the preferred one.

I'm not saying everyone can do this. I don't have a lengthy job commute -- though I will have a short one in a few weeks; yes, folks, it looks as if Tansy may have landed a paying gig -- so that makes the flexibility a lot more feasible. But it's amazing what errand consolidation, planned grocery shopping, and "Do I REALLY need to drive 5/15/30 miles to get this right now?" can do.

If we could come up with a figure of how many miles per week each of us needs to drop in order to a.) save the corn crop for food and/or b.) reduce the overall gasoline consumption equivalently, maybe we could finish what we started back in '75.


Tansy Gold, who needs to check the oil in her car before she sets out on today's "commute"

[TalkingDog]

56. Congrats on the influx of cash, TG

I hear ya!

I also hear ya on the driving thing....

Until about 3 years ago our nearest grocery was 11 miles in either "main" direction. There's a bait/package store 2 miles away with ....how is it the Spousal Unit puts it???? oh, yeah, ....Vintage Food. But lots of beer, a deli with fresh cut steaks, hamburger, etc. Fishing and Grilling food as it were.

We had a new Food Lion move in about 4 miles away. Since the S.U.'s job is in town, it's easy to stop by the store for...whatever.

Speaking of whatever, I'm just checking in for a break. It's getting too hot to work outside, so I need to consider errands I need to run.

I'm glad your opportunity presented itself. It's easy to fret we feel there is an uncertain future. What we always seem to forget in our hubris, is that it is always uncertain. It is only our attitude about it that changes.

Break an appropriate body part! And good fortune!

[Ghost Dog]

60. Good luck with the economy measures and the gig, Tansy!

Don't forget to keep your tires well-inflated, too.

[burf]

67. Maybe some are returning to sanity

The DTN Ethanol Blog has several stories today on delayed openings of new ethanol plants and how some of the small and medium plants are looking at closing. With corn getting to seven bucks they even with government help its not looking like a money maker. My guess is Big Ag and Big Oil will pick up the best plants and the others will go by the wayside. For more info, you can use the google to find DTN Ethanol Blog. Gotta go finish cleaning out the chicken coop. Have a great day everyone!

[Ghost Dog]

71. As regards wheat, I see this story is still developing (strongly?):

Potentially devastating wheat rust spreading.

[Robbien]

73. When making ethanol, they throw out as waste a good portion of the corn kernel

The whole kernel is not needed to make fuel but the whole kernel is contaminated by the fuel making process, so the waste is discarded as garbage. An article over the weekend discussed the idea the ethanol makers had of perhaps they should start separating the kernel BEFORE starting the ethanol process and then selling the untouched unwanted edible parts of the kernel to food processors.

Well duh!

I guess these guys were so giddy from making tons of money from huge ethanol federal subsidies that they weren't even paying attention to the food they were throwing away.

[ozymandius]

21. European Stocks Rise, Led by Barclays; U.S. Index Futures Gain

June 16 (Bloomberg) -- European stocks gained for a third day, led by Barclays Plc and BNP Paribas SA, after investors speculated banks will be able to replenish capital as the credit-market turmoil subsides. U.S. index futures and Asian shares advanced.

Barclays jumped the most in two months after the U.K. bank said a sale of shares was ``under active consideration'' and profit rose. BNP Paribas of France climbed as JPMorgan Chase & Co. said the worst of credit-related writedowns is over. Barratt Developments Plc led Britain's homebuilders higher as the Sunday Times said investors are working to raise funding for the industry. Toyota Motor Corp. gained in Tokyo, while General Motors Corp. increased in Frankfurt trading.

.....

Europe's Dow Jones Stoxx 600 Index added 0.2 percent to 306.21 at 10:51 a.m. in London, reversing earlier declines of as much as 0.3 percent. Concern that credit losses approaching $400 billion, rising oil prices and higher inflation will curb profit has dragged the Stoxx 600 down 16 percent this year.

Futures on the Standard & Poor's 500 Index gained 0.3 percent, and the MSCI Asia Pacific Index increased 1.6 percent.

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

[Ghost Dog]

45. Nikkei up 2.7 pct, exporters rise on weaker yen

TOKYO, June 16 (Reuters) - Japan's Nikkei stock average rose 2.7 percent on Monday as exporters such as Kyocera Corp (6971.T: Quote, Profile, Research, Stock Buzz) climbed on a weaker yen and after U.S. data eased worries on Wall Street about inflation and a near-term rise in interest rates.

The Tokyo market's gains picked up pace in the afternoon, partly buoyed by rises in other Asian markets, with Hong Kong's Hang Seng Index .HSI up 2.7 percent.

Japan's largest auto battery maker GS Yuasa Corp (6674.T: Quote, Profile, Research, Stock Buzz) shot up 10.6 percent after the Nikkei business daily reported that its partner in next-generation batteries, Mitsubishi Motors Corp (7211.T: Quote, Profile, Research, Stock Buzz), will tie up with France's PSA Peugeot Citroen (PEUP.PA: Quote, Profile, Research, Stock Buzz) on electric vehicles.

/... http://www.reuters.com/article/marketsNews/idCATKV00312620080616?rpc=44

[Ghost Dog]

52. European Stocks, U.S. Index Futures Fall; Danone, GE Decline

June 16 (Bloomberg) -- European stocks fell for the first time in three days after UBS AG recommended selling shares of Groupe Danone SA and Unilever, oil prices climbed to a record and manufacturing in New York contracted more than forecast. U.S. index futures retreated, while Asian shares advanced.

/... http://www.bloomberg.com/apps/news?pid=20601085&sid=algP11fGp9r4&refer=europe

[Ghost Dog]

54. High Food Prices `Are Here to Stay,' Nestle Forecasts

June 16 (Bloomberg) -- High food prices ``are here to stay'' as governments divert resources to make biofuels, amass stockpiles and limit exports, according to Peter Brabeck-Letmathe, chairman of Nestle SA, the world's largest food company.

Food prices ``will establish themselves on a higher level but not at the peaks we have seen,'' Brabeck, 63, said in an interview today on Bloomberg Television. Still, Vevey, Switzerland-based Nestle has no plans to raise prices further this year, he said.

Finance ministers from the Group of Eight nations warned June 14 that surging food and fuel prices have replaced the credit squeeze as the biggest threat to the world economy. Corn, wheat, and rice have soared to records this year, putting millions in Asia at risk of hunger, according to the Asian Development Bank.

/... http://www.bloomberg.com/apps/news?pid=20601085&sid=aQx_y9y.0JyM&refer=europe

[UpInArms]

22. Analysts see lower Q2 earnings at investment banks

http://www.reuters.com/article/businessNews/idUSBNG16629520080616?sp=true

BANGALORE (Reuters) - Wall Street analysts have forecast a huge drop in second-quarter earnings for Goldman Sachs Group Inc and Morgan Stanley, while Lehman Brothers Holdings Inc is expected to post its first-ever quarterly loss, mainly on hedging losses.

Analysts expect the three Wall Street investment banks reporting results this week to record losses mainly from ineffective hedging, amid an overall tough operating environment. Lehman is projected to take the worst hit.

"Business conditions appear to be among the worst in several years, bulk asset sales have provided price transparency that should trigger more asset write-downs, and hedging was noticeably less effective," David Trone, an analyst at Fox-Pitt Kelton, said in note last week.

<snip>

"The hedge is not working," wrote Bove, who had nearly a year ago recommended that investors sell financial stocks as credit market problems began.

<snip>

According to Fox-Pitt's Trone, the three investment banks are expected to incur gross writedowns of $9 billion on their "problem assets."

Net writedowns for the quarter is expected to be "the worst since the bust began," and only marginally smaller than the gross estimate, Trone said.

...more...

[UpInArms]

35. Lehman 2Q loss $2.8 bln - Lehman reports negative 2Q revenue of $700 million

01. Lehman reports negative 2Q revenue of $700 million
8:22 AM ET, Jun 16, 2008

02. Lehman 2Q loss $2.8 bln
8:21 AM ET, Jun 16, 2008

03. Lehman Bros. Q2 loss $5.14 per share
8:20 AM ET, Jun 16, 2008

[UpInArms]

40. Lehman posts first loss as a public company

http://www.reuters.com/article/marketsNews/idUSWEN627520080616

NEW YORK (Reuters) - Investment bank Lehman Brothers Holdings Inc posted a $2.8 billion loss on Monday after recording massive trading and hedging losses.

The fourth-largest U.S. investment bank posted a loss of $5.14 a share for the second fiscal quarter ended May 31, compared with net income of $1.27 billion, or $2.21 in the same quarter last year. The loss was Lehman's first since being spun off from American Express Co in 1994.

The results were in line with the loss the company had forecasted last week, when Lehman said it was raising $6 billion of fresh capital.

Banks and other financial institutions globally have written down more than $400 billion of assets as the value of once-attractive assets like mortgage securities drops.

...more...

[ozymandius]

23. Goldman, Morgan Stanley Profits Conceal Reliance on Commodities (was this ever in question?)

June 16 (Bloomberg) -- On Wall Street, where just about everyone has lost confidence in financial assets, Goldman Sachs Group Inc. and Morgan Stanley are making money the old-fashioned way: Buying and selling commodities.

Goldman and Morgan Stanley are expected by analysts to report the best second-quarter earnings of the world's biggest securities firms this week, having limited their losses from the collapsing credit market. They also lead Wall Street in commodities trading, where crude oil futures doubled in the past year and the price of products from gold to corn soared to record highs.

.....

Commodity trading ``is very large for them, and that is even more important now given what's happening with the rest of the businesses,'' said Frank Feenstra, a consultant at Greenwich Associates, the Greenwich, Connecticut-based research firm whose survey last month found Goldman and Morgan Stanley were the preferred dealers of corporate users of commodity derivatives. ``There are more commodities used, more hedging by companies, and the investor population has increased significantly as well.''

Goldman probably will report a 32 percent drop in second- quarter profit tomorrow, and Morgan Stanley may say on June 18 that net income fell 59 percent from a year earlier, according to the average estimate of analysts surveyed by Bloomberg.

.....

Goldman and Morgan Stanley, the two largest U.S. securities firms by market value, don't report commodity revenue separately, lumping it instead into the same line as fixed-income and currency trading. That makes it difficult to assess just how much commodity revenue has cushioned earnings.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aboqiSz1AZm4&refer=news

[ozymandius]

24. Honda May Mass-Produce FCX Clarity Fuel-Cell Car in 10 Years

June 16 (Bloomberg) -- Honda Motor Co., Japan's second- largest automaker, may start mass production of its FCX Clarity fuel-cell car within 10 years to meet growing demand for fuel- efficient models.

``If we can bring costs down by a certain amount, I think we can start mass-production,'' President Takeo Fukui said in an interview at its new-model center today in Tochigi prefecture, northeast of Tokyo. Honda began production of the FCX Clarity at the center today.

Honda plans to lease 200 FCX Clarity vehicles in the U.S. and Japan over the next three years and has five customers for the car in the U.S., the company said in a statement. The carmaker is adding low-pollution models including fuel-cell and gasoline-electric hybrids as record-high oil prices and tougher carbon-emission rules boost demand for cars that use less fuel.

.....

Fuel cells create electricity in a chemical process that combines hydrogen and oxygen. Ideally, water vapor is the only emission.

http://www.bloomberg.com/apps/news?pid=20601101&sid=aP1jZTypWBBM&refer=japan

[UpInArms]

25. Capital One charge-offs rise in May

http://www.marketwatch.com/news/story/capital-one-charge-offs-rise-may/story.aspx?guid=%7B98E0154A%2D7F8B%2D49F0%2DB83F%2DD630208A1A71%7D&dist=TQP_Mod_mktwN

LONDON (MarketWatch) -- Capital One (COF) said in a filing to the
Securities and Exchange Commission that its U.S. charge-off rate was 6.28% and that its international charge-off rate was 6.5%. In April, the U.S. charge-off rate was 6.08% and the international rate was 6.34%

[UpInArms]

26. Consumers stay home and opt for frozen foods, Spam and crafts

http://www.marketwatch.com/news/story/americans-enter-new-cycle-tough/story.aspx?guid=%7B2AD5D9FF%2D408C%2D443E%2DB295%2DF154C2DF194E%7D

CHICAGO (MarketWatch) -- Wondering how consumers are coping in such a troubled economy? Look at what's selling instead of which sales are tanking.

As consumers muddle through all that is plaguing the U.S. economy, they have battened down the hatches and sharply shifted their spending habits, turning to money-saving options that run the gamut from transportation to health as they find ways to pay for dramatic increases in gasoline and food.

What emerges is a new paradigm of consumerism that some experts believe will live long after this economic crisis is resolved.

"Suddenly consumers are focused on buying what they have to have as opposed to buying what they want to have," said Howard Davidowitz, chairman of Davidowitz & Associates, a New York-based retail consulting and investment-banking firm.

"This is a permanent change for Americans, who will face a declining standard of living over the next 20 years," he added.

...more...

[ozymandius]

27. Managers of Failed Bear Hedge Funds May Face Criminal Indictments

Managers of Failed Bear Hedge Funds May Face Criminal Indictments (And Why Not Bear?)

The Wall Street Journal reports that criminal charges against the managers of the failed Bear Stearns hedge funds, Ralph Cioffi and Matthew Tannin, are imminent. The Journal also indicates there are no charges pending against Bear Stearns or any other Bear executives.

Pray tell, why not?

The funds were clearly under the supervision of Bear Stearns; the Journal story reports that Cioffi had to get approval from Bear's compliance department to move $2 of the $6 million he had invested in the riskier of the two funds he managed into an internal Bear fund. The funds were located in the Bear headquarters building and used Bear's risk management systems.

Early on in the meltdown of the funds, Bear had tried to take the position that they were independent entities and therefore could sink or swim on their own. Bear was forced to relent, and my view at the time was that it was due to the rest of Wall Street having considerable leverage (literally, the other firms could cut repo lines or take other punitive action) rather that out of a consideration of legal niceties (exactly how responsible should Bear be as sponsor of the funds?).

Had I not read about Cioffi's little chat with compliance, I could have accepted the view that the funds were independent enough in legal structure and operation as to get Bear off the hook. But that interaction says that Cioffi thought that Bear had oversight of the fund (and if Bear didn't, the compliance officer should have dismissed the inquiry rather than giving approval). Similarly, the story also indicates the funds were NOT independent, but part of Bear's asset management operation. These all say the firm had a duty to supervise. Unless it is established that Cioffi and Tannin willfully misled the firm, it ought to be Bear, not these individuals, that is in the dock.

.....

Never attribute to malice that which can be explained by incompetence. Although the details may prove otherwise, I find it plausible that Cioffi and Tannin were slow to recognize that subprime was terminal, and Bear did an incompetent job of supervising them. And if that's the case, it's Bear, and not the two managers, who should be the focus of the investigation.

http://www.nakedcapitalism.com/2008/06/managers-of-failed-bear-hedge-funds-may.html

[UpInArms]

29. Chopper Ben Caught Out in Lies by NoFacts??

Bernanke not about to raise rates, columnist says

http://www.marketwatch.com/news/story/bernanke-not-about-raise-rates/story.aspx?guid=%7BE6555085%2D4B4A%2D46F8%2D8B5C%2D0F2856FA5C6C%7D&dist=msr_1

NEW YORK (MarketWatch) -- Columnist Robert D. Novak said in a story published Monday that sources close to Ben Bernanke indicated the Fed chief has no current plans to raise interest rates to fight inflation. Bernanke is more worried about the jump in oil and gasoline prices causing an economic slowdown rather than an overheated economy, Nova said, citing sources.

(note that the article misspells his name to "Nova" which means Zero in Spanish)

[Dr.Phool]

30. Bob Zero. How fitting.

Makes sense to me!

[ozymandius]

31. to parse this a bit

I read this as "no va". Meaning: "does not go".

[UpInArms]

34. thanks for the parsing, Ozy!

I recall being amused about the Chevy Nova being driven in Mexico when the word was translated - many years ago and memories fade and become airbrushed

:hi:

[ozymandius]

37. I recall the story about the Chevy Nova being a fabulous car.

Despite this - the sales of the car tanked in Mexico because of the name. And Chevrolet discontinued the model when it could not make enough profit from the repairs. It seems that it va'd all too well.

[Dr.Phool]

44. How long before the American people say "no mas".

[lib2DaBone]

49. Everyday I ask.....

the same question: "When will the American People Get It"? Then I drive down the street and see a huge Lincoln Navigator with "W-04" Stickers all over it and a big Jesus Fish on the back. There is no hope for these people.

[Ghost Dog]

85. Yes exactly: No va = Doesn't go or doesn't work = Useless. n/t

[DemReadingDU]

32. Whitney: The Irish People have spoken.

For Mike Whitney this is a short essay...


6/14/08 The Irish People have spoken. Mike Whitney
Lisbon Is Dead

On Friday, Ireland delivered a knockout punch to European elites and corporatists and shattered their plan for an EU Superstate. The so-called Lisbon Treaty was nothing more than a repackaging of the European Constitution that was defeated by French and Dutch voters in 2005. The treaty was loaded with the typical "democratic" gobbledygook to conceal the vicious neoliberal policies at its heart. If it had passed, the treaty would have paved the way for greater privatization of public services, diminished workers rights, less state control over trade policies and civil liberties, and an aggressive plan to militarize Europe. Ireland's entire political and corporate class stood foursquare behind the treaty, but the Irish people shrugged off the fear-mongering and bogus promises of prosperity and voted No. The referendum results showed 53.4% voted No, while 46.6% voted Yes. Despite the massive public relations campaign; the vote wasn't even that close.

A spokesperson for the No campaign put it like this:

“The Irish people have spoken. Contrary to the predictions of social and political turmoil, we believe that hundreds of millions of people across Europe will welcome the rejection of the Lisbon Treaty. This vote shows the gulf that exists between the politicians and the elites of Europe, and the opinions of the people. As in France and the Netherlands, the political leaders and the establishment have done everything they could to push this through – and they have failed. The proposals to further reduce democracy, to militarize the EU and to let private business take over public services have been rejected. Lisbon is dead. Along with the EU Constitution from which it came, it should now be buried.” (Socialist Worker online)

News of the defeat has not been well received in England where the government of Gordon Brown has already indicated that it will reject the election results and "press ahead" in an effort to ratify the treaty. Neither Brown nor his friends in Brussels are likely to be deterred by anything as trivial as the will of the people. Labour MP and former Europe Minister Denis MacShane summed it up like this:

"I personally think that a vote in a foreign country should not determine the democratic decisions taken in the British Parliament."

MacShane's view is apparently shared by EC President Jose Manuel Barroso who said that EU member states should continue ratifying the Lisbon treaty even though more than half of Ireland's 43 constituencies rejected it outright. So much for democracy.

The Irish have plenty to celebrate today. They've thrown a spanner in the plans of the bankers and corporate mandarins who want to replace representative government and national sovereignty with their own skewed vision of capitalist Valhalla; a Euro Utopia where short-term profits always take priority over the needs of people.

Bravo, Ireland.
http://www.informationclearinghouse.info/article20094.htm


Edit: I posted this info on 6/13/08 concerning Ireland
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3350619&mesg_id=3350996

[ozymandius]

33. US stocks head for narrowly mixed open

NEW YORK (AP) -- U.S. stocks headed for a mixed open Monday as investors awaited a regional manufacturing report and examined a change at the top of insurer American International Group Inc.

Treasury prices advanced following steep declines last week.

Wall Street is awaiting the New York Federal Reserve Bank's Empire State index, which is due before the opening bell, for insights into the health of the region's industrial sector. The report is the earliest of several monthly regional snapshots that investors look to for insights on economic activity.

Beyond the otherwise light economic calendar Monday, investors were reviewing AIG's decision to name former Citigroup Inc. executive Robert Willumstad as chief executive. Willumstad replaces Martin Sullivan after AIG logged billions in losses on bad bets in the mortgage market.

Dow Jones industrial average futures rose 14, or 0.11 percent, to 12,316. Standard & Poor's 500 index futures edged up 0.10, or 0.01 percent, to 1,359.80 and Nasdaq 100 index futures slipped 1.30, or 0.07 percent, to 1,973.20.

http://biz.yahoo.com/ap/080616/wall_street.html

[ozymandius]

42. Have fun this morning.

I have to leave for an interview of sorts. A former employer has asked me to return on a contract basis over the next few weeks as an audio engineer. This morning's meeting will define everything about pay, duties and hours.

I'll check back around lunchtime.

:hi:

[Dr.Phool]

47. Good luck. Hope everything works out for you.

You don't even wanna know where I'm going today!

[TalkingDog]

57. Bonne Chance! n/t

[Ghost Dog]

61. Asia, Europe Best Placed to Weather Slowdown, Officials Say

June 16 (Bloomberg) -- Asia and Europe are better placed than others to cope with the global economic slowdown, according to officials attending a meeting of finance ministers from the two regions in Jeju, South Korea.

The two areas ``have good fundamentals to weather in better condition than others these difficulties,'' European Union Economic and Monetary Affairs Commissioner Joaquin Almunia said in an interview today. French Finance Minister Christine Lagarde said the regions ``were far more resilient than expected in the light of the international economic crisis.''

Asian countries are turning to each other and oil-rich nations to make up for waning sales in the U.S. in the wake of the housing recession and subprime-mortgage crisis. In Europe, the euro's strength is damping the increase in the price of oil, and demand from the continent's emerging eastern half is keeping order books full in countries such as Germany.

The Organization for Economic Cooperation and Development predicts economic growth in Japan and the euro region will outpace the expansion in the U.S. both this year and next.

Growing intra-Asian trade has been compensating for slowing exchange between the U.S. and Asia, Supachai Panitchpakdi, secretary-general of the United Nations Conference on Trade and Development, said yesterday in Jeju.

`Not Devastating'

``I think there might be some slowdown but not really one that's devastating,'' Panitchpakdi said with regard to trade. ``Looking at the Asian economic growth on a general basis, at the moment I don't see much of a real impact'' from the U.S. slowdown.

German Deputy Finance Minister Thomas Mirow said ministers ``see with a certain relief that Asia not only isn't the source of the crisis, but so far has even held up fairly well,'' alluding to the 1997 market turmoil that gripped parts of Asia.

Still, Almunia said Asia and Europe face ``difficulties from an inflation point of view, because of oil prices, because of food prices.'' Financial-market turmoil is ``having some consequences in our real economies and growth forecasts have been reduced a little bit.''

/... http://www.bloomberg.com/apps/news?pid=20601080&sid=ajW5eTQ4.B1E&refer=asia

[Ghost Dog]

62. India, China most optimistic about their economic condition

SILICON VALLEY: People in India and China remain upbeat and optimistic about their national economic conditions, contrary to the trend witnessed globally, a recent survey by independent body, the Pew Research Centre has found.

Majority of people in 18 of the 24 countries surveyed described the current economic situation of their country as bad and believe things will either worsen or stay constant over the next year, according to the survey conducted on more than 24,000 people in 24 countries.

China and India, however, are exceptions to these trends and publics in the two countries are largely happy with their current economic situation and optimistic about their economic future.

The survey found the people of South Korea were the most overtaken by gloom, with 92 per cent of the respondents saying their national economic conditions is bad, followed by Lebanon (90 per cent), Japan (85 per cent) and France (81 per cent).

The most negative evaluations of economic conditions came from citizens of advanced Western countries, it said.

In fact, in many of these countries the decline in positive view represents a reversal in opinion from positive overall to negative overall in just one year.

In Great Britain, positive views of the economy declined from 69 per cent in 2007 to 30 per cent in 2008, while in US it slipped from 50 per cent to 20 per cent.

/... http://economictimes.indiatimes.com/News/Economy/Indicators/India_China_most_optimistic_about_their_economic_condition/rssarticleshow/3130908.cms

[Ghost Dog]

64. China Industrial-Output Growth Accelerates on Exports

June 16 (Bloomberg) -- China's industrial-production growth accelerated on rising exports, signaling that the world's fourth-biggest economy is weathering a global slowdown.

Output rose 16 percent in May from a year earlier after gaining 15.7 percent in April, the statistics bureau said today. That matched the median estimate of 22 economists surveyed by Bloomberg News.

Overseas shipments surged last month and retail-sales growth was close to the highest in nine years, keeping factories busy even as the deadliest earthquake in 32 years disrupted output in Sichuan province. The shortening of a weeklong May holiday to a three-day break boosted production.

``Exports saw solid growth in May and it was the same for industrial production,'' said Wang Qian, an economist with JPMorgan Chase & Co. in Hong Kong. ``The export sector is going to face stronger headwinds going forward.''

The yuan traded at 6.9029 versus the dollar as of 3:29 p.m. in Shanghai, after closing at 6.9018 on June 13.

Chinese output growth is more than double the pace in India, the world's second-fastest growing major economy. Production in that country rose 7 percent in April from a year earlier.

Global growth will slow to 1.8 percent this year, the weakest pace since 2002, the Organization for Economic Cooperation and Development said this month. The figure is for the OECD's 30 members. China's economy will ease to a 10 percent expansion after growing 11.9 percent in 2007, it said.

Quake Reconstruction

Sichuan's small role in China's manufacturing limited the May 12 disaster's effect on production. Quake reconstruction work is boosting output of some products, with state-owned Baosteel Group Corp. making more steel sheets for housing.

Raw-coal production rose 18.5 percent in May from a year earlier after gaining 13.9 percent in April. Crude-oil output climbed 1.8 percent after increasing 0.5 percent.

Strength in production, retail sales and exports may encourage the central bank to implement the ``forceful measures'' that it said last week were needed to stop prices from rising excessively.

``With export and domestic consumption holding up, China's policy makers are more concerned about inflation than economic growth,'' said Paul Tang, chief economist at Bank of East Asia Ltd. in Hong Kong.

No. 1 Challenge

Rising prices are the economy's biggest challenge in 2008, the government says. Producer prices jumped 8.2 percent last month, the largest increase in more than three years, signaling pressure for inflation to rebound after easing from close to a 12-year high. Consumer prices rose 7.7 percent in May.

The central bank has ordered lenders to set aside a record 17.5 percent of deposits as reserves from June 25 to try to prevent excess cash in the financial system from fueling inflation. It has also allowed the yuan to gain 5.8 percent versus the dollar this year.

China's export growth accelerated to 28.1 percent in May from a year earlier. Retail sales gained 21.6 percent.

/... http://www.bloomberg.com/apps/news?pid=20601068&sid=aM8SPseoRskc&refer=economy

[Ghost Dog]

65. The brewing economic and security storms (in Pakistan)

Mon, 2008-06-16 04:09
By Asif Haroon Raja

The ongoing political wrangling over deposed judges for well over one year has caused immense frustration to the people already suffering the pangs of back breaking price hike, flour crisis and prolonged hours of load shedding in this sweltering heat. About 90 days have lapsed and so far no relief is in sight as was promised by the newly elected PM Gilani in his loudly thumped 100-day relief package. Rather, matters have worsened as inflation continues to soar and prices of daily commodities, petrol, gas and electricity are shooting up.

Notwithstanding that the flawed economic policies and presentation of false economic indicators has a lot to do with the sorry state of affairs, but the inability of the current rulers to stem the rot has given heart to the former rulers that their tenure was much better.

The so-called finance wizard Shaukat Aziz had not only fudged economic indicators to give a rosy picture of the overall state of economy but had also proudly claimed that Pakistan had finally broken the begging bowl. He had stated that the borrowing spree from IMF had been terminated and the foreign debts were being retired. He took credit for being able to maintain an average GDP of 7% in the last five years and promised that the trickle down was about to occur which will provide much needed relief to the masses.

He had claimed that Pakistan had turned into the fastest growing economy in Asia. All these tall claims proved illusive when the regime change took place after 18 February. Having realised that his falsehood was about to get unearthed, Shaukat considered it prudent to quietly flew away to foreign lands from where he had come with a specific agenda of his mentors. His fans who did not tire eulogising him are now vainly cursing him. People are now questioning as to where $63 billion that had poured into national treasury from foreign sources from 2001 onwards have evaporated?

The present rulers keep palming off their inefficiencies to their predecessors on the plea that they had inherited too huge a mess that could not be tidied up overnight. Gilani led team remote-controlled by Zardari seek time to cleanse the Aegean stables through long-term well thought-out changes in political, economic, and judicial structures. Huge fiscal deficit, chronic power crisis that cannot be overcome before three years, massive foreign debt which has shot up from $36 billion in 1999 to $47 billion, ballooning of the fiscal, current account and trade and balance of payments deficits, huge defence budget, declining stock exchange, depleting foreign exchange which has dropped from $16 billion to about $12 billion in less than a year, together with mega corruption scandals are some of the major hangovers which the new regime had to contend with and which has impacted the economy adversely.

Over 80% of expenditure is on defence, debt-servicing and government overheads while revenue generation remains poor mainly because of corrupt system of tax collection. Great majority of the dirty rich either do not pay taxes or whatever they pay is a drop in the ocean. Loan defaulters and wheat hoarders and those who had indulged in mega scams have been let off. In the last financial year, the government borrowed money from the state bank to finance its expenditures to the tune of 330% over and above the estimated budget. These constraints made things really difficult for new managers to provide any meaningful relief to the people.

/... http://www.asiantribune.com/?q=node/11806

Let the above serve as a warning to the new economic team preparing to move into the White House soon.

[Hugin]

69. The Nation Magazine: Name Our Epoch

Name Our Epoch
posted by Peter Rothberg on 06/13/2008 @ 3:49pm



As John Cavanagh and Chuck Collins write in the current issue of The Nation -- a special look at rising inequality, "Over the past three decades, market-worshiping politicians and their corporate backers have engineered the most colossal redistribution of wealth in modern world history, a redistribution from the bottom up, from working people to a tiny global elite."

Historians divide history into epochs. We've all heard of the Gilded Age, the Roaring Twenties and the Great Depression. Our current epoch, however--a period that has seen soaring fortunes for a new American super rich and a fading American Dream for nearly everyone else--lacks a label.

Some commentators have tried to supply one. Paul Krugman calls our past three decades of growing inequality the Great Divergence. Berkeley economist Harley Shaiken speaks about the Great Disconnect, his tag for years of stagnant and declining wages amid a growing economy. But neither has really caught on. That's why The Nation is joining the Institute for Policy Studies in a new contest.

Please tell us what you would Name Our Epoch! Send an email [e-mail] with your suggested label for our excruciatingly unequal times. Put your thinking cap on now--we need your entry by July 4. An all-star panel of judges--historian Howard Zinn, journalist Barbara Ehrenreich and novelist Walter Mosley--will determine the winner. In addition to the satisfaction of coining a phrase that may go down in history, the winner will receive personally autographed books written by each of the three distinguished judges.


http://www.thenation.com/blogs/actnow/329620


Thanks to DUer marmar for posting this over the weekend.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x3456317
________________________________________________________________________________

Looks like "The Nation" picked up on an attempt to attach a moniker to this monkey on our backs.

If you'd like to try entering... Good luck, it seems all of my low cost free e-mail addys are blocked. :/

I give anyone permission to enter my try... "The Gordian Knot". I liked this one because it is not only very
descriptive, but, it gives an indication of the bold stroke required to get this ship on track. (Yes, I know that's
a mixed metaphor. ;) )

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


Well, I'm off to begin researching a new book on the Pre-Younger Dryas Impact/GRB Event... Working title: "Kiss Your
Clovis, Goodbye." :hi:

[SpiralHawk]

75. My suggested name for the epoch: The Royal Republicon Rip Off

Thanks a pantload, republicons.

[radfringe]

81. the Bush ERROR... n/t

[Ghost Dog]

87. The Terminal Consumption n/t

:-(

[antigop]

78. US, China firms to sign 30 deals worth billions

http://rawstory.com/news/afp/US_China_firms_to_sign_30_deals_wor_06162008.html

Top firms from the United States and China will sign Monday more than 30 commercial deals worth billions of dollars ahead of senior level official talks on critical economic issues, an official said.

The inking of the agreements will be witnessed by Chinese Vice-Premier Wang Qishan and Commerce Minister Chen Deming, who are leading a cabinet team for two days of talks with the US side led by Treasury Secretary Henry Paulson and Federal Reserve chairman Ben Bernanke.

"We are going to have over 30 commercial deals worth several billions of dollars to be announced today involving hi-tech, manufacturing and telecommunication companies," Myron Brilliant, US Chamber of Commerce vice president for East Asia, told AFP.

Among the US companies that would be forging the deals are General Motors, Cisco, Ford, IBM, Oracle and Motorola while the Chinese side will include dominant local mobile operator China Mobile, he said.

The US Chamber of Commerce, led by its president, Tom Donohue, will host the deals' signing ceremony, which is expected to give a psychological boost to the US-China "strategic economic dialogue" (SED) beginning Tuesday at the Naval Academy in Annapolis, east of Washington.

So how many US jobs will be cut?

[DemReadingDU]

79. CNN: Six bank stocks worth buying

6/16/08 Six bank stocks worth buying
Many bank stocks are at multi-year lows and more trouble lies ahead. But some value fund managers argue that not all banks are doomed.

Banks have got investors running scared.

From writedowns to dividend cuts to dilutive stock offerings, it's no wonder that so many banks have seen their market values evaporate.

It seems almost inevitable that more difficulties lay ahead for the most troubled banks, including companies like Wachovia and Washington Mutual, given further fallout both in the housing market and the broader economy.

But even with all these tales of woe, some value fund managers say there may be a handful of bank stocks that are now too cheap to pass up.

"There are some good long-term values out there," said Bill Andrews, a portfolio manager for the Pittsburgh-based money manager C.S. McKee. "The question on everyone's mind is: 'Do they get cheaper before they go up?' "

Wells Fargo
Sovereign
Washington Federal
Bank of America
SunTrust
Bank of New York Mellon

More discussion of each of these at the link...
http://money.cnn.com/2008/06/16/news/companies/bank_stocks/index.htm?postversion=2008061612


Personally, I would not touch any banking stock stock with a 10-foot pole.

[AnneD]

82. Toyota Struggles to Keep Up With Battery Production for Hybrids

TOKYO – Toyota Motor Corp. is struggling to keep up with booming demand for hybrid vehicles because it is unable to make enough batteries that are key parts in the hit "green" cars, a senior executive said Monday.

The crunch on battery production is likely to stay for the rest of the year, as new lines can't be added to boost production until next year, said Toyota Executive Vice President Takeshi Uchiyamada, who oversees production at Japan's top auto maker.

"Hybrids are selling so well we are doing all we can to increase production," he said.

http://online.wsj.com/article/SB121360806921976963.html


Just think, if Detroit had REAL leadership.....this round the clock production could be in Michigan today....

[AnneD]

83. Nearly Half of Wall St. Bank Profits Are Gone

Only a year ago, Wall Street reveled in an era of superlatives: record deals, record profit, record pay. But a mere 12 months later, nearly half of the profits that major banks reaped during that age of riches have vanished.

But since last July, those same banks — Bank of America, Citigroup, JPMorgan Chase, Lehman Brothers, Merrill Lynch, Goldman Sachs and Morgan Stanley — have written down the value of the assets they hold by $107.2 billion, gutting their earnings and share prices. Worldwide, the reckoning totals $380 billion, much of which reflects a plunge in the value of tricky mortgage investments.

More downbeat news is expected this week, when several big banks, including the ailing Lehman Brothers, are scheduled to report results for the latest quarter. As the tally of losses keeps growing, many bank executives — and their shareholders — keep asking the same question: When will the pain end?

But the finish line just seems to keep moving further away. Even when the losses end, bank executives are looking toward a new era of lower returns, thinner profits and fewer jobs. Greater scrutiny from regulators is forcing Wall Street firms to reduce their use of leverage, or borrowed money, which had fueled profits in good times but backfired when the credit crisis struck last summer. Nearly every finance company is cutting jobs and battening down.

http://www.nytimes.com/2008/06/16/business/16earnings.html?_r=1&ref=business&oref=slogin

I apologize if this has been posted before. I just wonder where the money is going?????

[AnneD]

86. Fiscal Poison Pill

A poison pill, in corporate jargon, is a financial arrangement designed to protect current management by crippling the company if someone else takes over.

True, the tax cuts won’t prevent a change in management — the Constitution sees to that. But they will make it hard for the next president to change the country’s direction.

Exhibit A of the poison pill in action is the sad case of John McCain, part of whose lingering image as a maverick rests on his early opposition to the Bush tax cuts, which he declared excessive and too tilted toward the rich.

Since then the budget surpluses of the Clinton years have given way to persistent deficits, and income inequality has risen to new heights, vindicating his opposition.

But instead of pointing this out, Mr. McCain now promises to make those tax cuts permanent — and proposes further cuts that are, if anything, tilted even more toward the wealthy. And how is the loss of revenue to be made up? Mr. McCain hasn’t offered a realistic answer.

more...

http://www.nytimes.com/2008/06/16/opinion/16krugman.html


A good op ed piece by Paul Krugman...

[AnneD]

88. Great Lawsuit.......

Devo Suing McDonald’s Over Stupid Hat


According to Australia’s National Nine, post-punk pioneers Devo say they are taking McDonald’s to court to Whip’m… Whip’em Good.

In April, McDonald’s released a series of American Idol Happy Meal toys based on a range of music genres, that included Disco Dave, Country Clay, Soulful Selma and, of course, New Wave Nigel.

Devo claims that New Wave Nigel not only rips off their stupid flour pot hat, but plays a “Devo-esque song”. According to National Nine:

Bass player Gerald Casale said the band were taking legal action against McDonald’s for using their copyrighted hat without permission.

“We are in the midst of suing them,” Casale told AAP.

“This New Wave Nigel doll that they’ve created is just a complete Devo rip-off and the red hat is exactly the red hat that I designed, and it’s copyrighted and trademarked.

“They didn’t ask us anything. Plus, we don’t like McDonald’s, and we don’t like American Idol, so we‘re doubly offended.”

Novelty band Devo was formed in Akron, Ohio, in 1974, are famous for their 1980 hit Whip It.

McDonald’s has not commented so far, though their defense is likely to be: “DEVO? Those guys are still alive?”



http://www.franchisepick.com/devo-suing-mcdonalds-over-stupid-hat/

I think I hear a theme song coming on......:spank:

Crack that whip
Give the past the slip
Step on a crack
Break your momma's back

When a problem comes along
You must whip it
Before the cream sits out too long
You must whip it
When something's going wrong
You must whip it

now whip it
into shape
shape it up
get straight
go forward
move ahead
try to detect it
it's not too late
to whip it
whip it good

When a good time turns around
You must whip it
You will never live it down
Unless you whip it
No one gets their way
Until they whip it

I say whip it
Whip it good

[UpInArms]

93. puttin' an end on this day

Dow 12,269.08 38.27 (0.31%)
Nasdaq 2,474.78 20.28 (0.83%)
S&P 500 1,360.14 0.11 (0.01%)
10-Yr Bond 4.245% 0.016

NYSE Volume 3,731,911,250
Nasdaq Volume 1,883,675,500

4:15 pm : The stock market settled unchanged on Monday, as strength in financials offset weakness in consumer staples and telecom. The tech-heavy Nasdaq Composite handily outperformed the broader market with a gain of 0.8% thanks to strength in large-cap names.

Much of the action, however, was outside of the stock market, with crude prices going on massive $7 swing from peak to trough.

Crude oil futures soared 3.7% to an all-time high of $139.89 per barrel in premarket trading -- which occurred despite reports that Saudi Arabia is going to increase its output by 200,000 barrels a day, increasing worldwide supply by 0.2%. There was not a specific catalyst for the advance, although a declining dollar (-0.7%) and reports of a North Sea rig fire played a role in the buying interest. Then on no specific news, crude reversed in the red, settling the day with a loss of 0.8% at $133.82 per barrel.

The financial sector was once again in focus on Monday. Lehman Brothers (LEH 27.09, +1.28) reported a second quarter loss of $2.8 billion, or $5.14 per share -- matching its preannouncement. Lehman's stock rose 5%, with investors encouraged on word that the company cut its mortgage holdings by 20%.

AIG (AIG 34.02, -0.16) ousted its CEO in response to poor handling of the credit market turmoil, which follows in the footsteps of several other major financial firms. AIG said the management change is not in response to its second quarter results, which the company is expected to report sometime in August.

Financials (+1.1%) outperformed throughout the session, and settled the day with the largest advance.

The Nasdaq outperformed with Research In Motion (RIMM 140.96, +8.00) benefiting from several positive brokerage comments and Teva Pharmaceutical (TEVA 44.74, +2.24) advancing after announcing one of its drugs can slow down the progression of Parkinson's disease. Apple (AAPL 176.85, +4.48) also gave the index a boost, with brokerage firm RBC increasing its iPhone sales estimates and speculation over CEO Steve Jobs' health driving the buying interest.

Brokerage downgrades of giants General Electric (GE 28.96, -0.19), Verizon (VZ 36.19, -1.14) and AT&T (T 36.14, -0.54) -- which make up more than 5% of the S&P 500 -- prevented the broader market from making an advance.

Verizon and AT&T were downgraded to Neutral from Buy at UBS. The firm believes economic weakness will hinder results at the telecom giants. The telecom sector (-1.4%) posted the largest loss of the day.

General Electric -- the second largest company within the S&P 500 behind Exxon Mobil (XOM 88.00, -0.36) -- was downgraded to Neutral from Outperform at JPMorgan. The firm feels that slower economic growth may reduce GE's earnings.

In economic news, June manufacturing activity in the New York region contracted by a larger-than-expected amount, according to the NY Empire State Index. The reading slipped 5.5 to -8.7, which fell short of the consensus estimate of -2.0. The stock market responded negatively to the report.DJ30 -38.27 NASDAQ +20.28 NQ100 +1.0% R2K +1.0% SP400 +0.8% SP500 +0.11 NASDAQ Dec/Adv/Vol 1168/1673/1.85 bln NYSE Dec/Adv/Vol 1225/1879/1.16 bln