STOCK MARKET WATCH, Thursday September 18

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday September 18, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 122
DAYS SINCE DEMOCRACY DIED (12/12/00) 2797 DAYS
WHERE'S OSAMA BIN-LADEN? 2522 DAYS
DAYS SINCE ENRON COLLAPSE = 2813
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.
$1 USD = EUR 1.06678
$1 USD = JPY 116.6200

AT THE CLOSING BELL ON September 17, 2008

Dow... 10,609.66 -449.36 (-4.06%)
Nasdaq... 2,098.85 -109.05 (-4.94%)
S&P 500... 1,156.39 -57.21 (-4.71%)
Gold future... 850.50 +70.00 (+8.97%)
30-Year Bond 4.08% -0.01 (-0.34%)
10-Yr Bond... 3.41% -0.08 (-2.32%)






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

Déjà vu? LET'S HOPE NOT!
BY CHRIS PUPLAVA

Back on August 27th I wrote a WrapUp entitled, “The Worst is Yet to Come.” There are a few reasons why I made this statement, with an excerpt from the article provided below:

Falling Earnings & Profit Margins = Falling Markets

Mr. Rogoff is probably correct that we aren’t even half way through the credit crisis, and I would also add that we are not even half way through the market correction, nor what will undoubtedly be declared a recession that began in either December of last year or January of this year. I agree 100% with the analysis of David Rosenberg, North American Economist for Merrill Lynch, presented in his article, “The Elusive Bottom.” Mr. Rosenberg doesn’t see the recession ending until mid-2009 and says that we could see S&P 500 operating earnings below $50, and also a price-to-earnings (P/E) multiple of 12…

-see chart-

So, with the credit crisis still in full swing and analyst estimates way behind the curve, the markets are likely to go through some serious disappointments ahead, disappointments that are not likely priced into the market currently. Thus, the markets will likely be much lower by year end and any positive strength should be used to increase defensive positions. The worst is likely to come…

I mentioned in the article that I agreed 100% with the analysis of David Rosenberg, North American Economist for Merrill Lynch, presented in his article, “The Elusive Bottom.” Mr. Rosenberg’s overall macro call is an end to the recession in the second half of 2009 and a market bottom roughly four months before that as markets are discounting mechanisms. My overall macro thoughts echo Mr. Rosenberg’s, and my call is also a bottom in the markets in the second or third quarter of next year as the markets discount an end to the current recession in the third or fourth quarter of 2009. As that is my overall big picture view, my mouth dropped when I received an e-mail from a co-worker who sent me a chart he saw from Minyanville’s Kevin Depew, who had a link to a chart showing the similarities between the current market’s movements and the early 1970s bear market. The path of the early 1970s market corresponds perfectly with my view of a bottom in the markets in the first half of 2009. I recreated the chart with the S&P 500 from both time periods normalized with their respective peaks corresponding to 100, with the 1970s experience overlaid with the current timeline. The similarities intrigued me enough to where I used the same time frame but with different variables and the results are shown below, with the current data updated through Monday’s close.

....

Because the state of the U.S. financial system, the housing market, as well as the debt-ladened consumer is so fragile currently, the government might not be able to afford a major collapse. With a major decline in household net worth resulting from the worst housing depression since the Great Depression, coupled with a bear market in stocks that is likely to continue into next year, the Federal Reserve and government might pull out all the stops. Right now the SEC can reinstate the up-tick rule, the Fed can cut the 50 basis points like the market was clamoring for on Tuesday, and the Federal Reserve can begin expanding its balance sheet to inflate our way out of this. These measures might help prevent a decline in the stock market to the extent that the early 1970s experienced, or even my own expectations for further declines into next year. An all out effort by the powers that be will be absolutely, unequivocably bullish for gold and devastating for the USD.

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

[Buttercup McToots]

9. Good Morning Ozy

:hi:

What will today bring us? Another black hole?
It will be interesting to see what other stick saves
will be pulled out of the hat...

[ozymandius]

11. Good morning McToots and all.

:donut: :donut: :donut:

I'm scouring the news sites while heading toward the analysis blogs. So far, there's much examination of what has happened - less about what's going to happen next. It woudl seem that everyone is holding their breath to see what happens to both WaMu and Morgan Stanley. Entities are lining up to review their respective balance sheets. Who walks away and why will steer market psychology.

Today's reports will have some impact - especially among continued jobless claims. But there's little in the way of news to provide guidance. So I really cannot offer any prognosis.

I don't know. Do you have any thoughts on this?

[Robbien]

45. Both Bloomberg and CNBC are saying the broker dealer model is finished

That there isn't enough profit in the system for more than just one broker dealer, and that the last broker dealer to be left standing will be Goldman.

I don't know. Maybe they are right for the short term. But in my opinion, greed is very greedy and needs to be fed. This guys aren't going to be sitting still for too long before setting up new ways of gaming the system.

[Antionehoboutsis]

17. true

true

[Warpy]

35. Asia took a dump before I went to bed

and closed mixed. Europe is trading mostly in positive territory.

I expect bargain hunters to come out today and tomorrow, but the rally won't compensate for the huge losses Monday and yesterday.

Overall, I'm pessimistic.

[Dr.Phool]

41. It's a tradition. Today is National Sucker Rally Day.

It's like the day after X-mas, when all the bargain hunters come scurrying out seeking deals on all sorts of worthless junk.

And tomorrow, back into pre-chimp days.

[Demeter]

21. It's NOT the Charts, It's the Fundamentals That Result In the Charts

and as far as fundamentals go, we are F! Unless and until all the idiots who set up these fundamentals are put out of power (because I don't believe they will ever "get religion" and start acting in sound and ethical ways), we are going to keep sliding.

These are the times when real moral leadership, for lack of a better phrase, is needed. Nothing else will change the fundamentals. And I don't mean fake Fundie morality. I mean FDR morality.

[Loge23]

30. We need to declare "trickle down" dead and buried

The economic philosphy of the republican/conservatives is drirectly responsible for the mess we're in now.
This country - businesses and citizens - MUST realize once and for all that trickle down DOES NOT WORK in our society.
If we, as a nation, could just get one degree smarter about our economic system this simple truth about trickle down would finally take hold.
Unfortunately, the current damage is so severe that it will take a "New Deal" program, at the least, to repair the system.

[Roland99]

68. Trickle Down has Dried Up

[Ghost Dog]

36. See here:

http://www.dailykos.com/story/2008/9/16/16623/9233/211/600830

[Demeter]

38. Thanks for the Post! I Think He's Got IT!

[Ghost Dog]

62. Damn right! Glad you've seen it now! Changes everything!

:thumbsup:

[54anickel]

63. Anyone catch pigs flying? Here's a once in a lifetime article to send to your Repub loved ones

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x7105174



http://www.dmagazine.com/ME2/dirmod.asp?nm=Core+Pages&type=gen&mod=Core+Pages&tier=3&gid=B33A5C6E2CF04C9596A3EF81822D9F8E

A Conservative for Obama

Leading Off By Wick Allison, Editor In Chief

THE MORE I LISTEN TO AND READ ABOUT “the most liberal member of the U.S. Senate,” the more I like him. Barack Obama strikes a chord with me like no political figure since Ronald Reagan. To explain why, I need to explain why I am a conservative and what it means to me.

In 1964, at the age of 16, I organized the Dallas County Youth for Goldwater. My senior thesis at the University of Texas was on the conservative intellectual revival in America. Twenty years later, I was invited by William F. Buckley Jr. to join the board of National Review. I later became its publisher.

Conservatism to me is less a political philosophy than a stance, a recognition of the fallibility of man and of man’s institutions. Conservatives respect the past not for its antiquity but because it represents, as G.K. Chesterton said, the democracy of the dead; it gives the benefit of the doubt to customs and laws tried and tested in the crucible of time. Conservatives are skeptical of abstract theories and utopian schemes, doubtful that government is wiser than its citizens, and always ready to test any political program against actual results.

snip>

Barack Obama is not my ideal candidate for president. (In fact, I made the maximum donation to John McCain during the primaries, when there was still hope he might come to his senses.) But I now see that Obama is almost the ideal candidate for this moment in American history. I disagree with him on many issues. But those don’t matter as much as what Obama offers, which is a deeply conservative view of the world. Nobody can read Obama’s books (which, it is worth noting, he wrote himself) or listen to him speak without realizing that this is a thoughtful, pragmatic, and prudent man. It gives me comfort just to think that after eight years of George W. Bush we will have a president who has actually read the Federalist Papers.

more...

:wow: :wow: :wow: :wow:

[TalkingDog]

108. I'm going to take out all Obama McCain references

Take it next door to the Republican Party HQ and ask them to read it because I want to know if they think I should vote for this guy...

[Tansy_Gold]

56. Okay, here I am with one of my (in)famous naive questions

Regarding "fundamentals":

Much has been made over the past year+ about the collapse of the housing market. It seems to be seen as a, if you will, fundamental fundamental.

So that was, I presume, the "logic" behind the bailout of Frannie -- we have to keep the housing industry solvent/stable/whatever so we can bring it back online and then everything will be fine.

And I concur in part because, as I've said before, I saw the major problem potential in the housing sector way back in 2001 when I listened to a mortgage broker brag about setting up deals for people who essentially couldn't pay back the money no matter what.

But now it seems to me that it wasn't, in fact, the housing market that CAUSED the crisis. Rather, housing was a symptom and then a trigger for the collapse.

When I worked at Lincoln Savings -- post-Keating days -- one of the explanations for some of Keating's horrific deals was that he wanted out of real estate development because it provided quick but unsustainable returns. What he USED his real estate development projects for was to establish an asset base from which to generate funds to boost him into the hotel/resort industry. He saw that as much more lucrative and providing of a steady inome.

Thinking about references to Keating the past couple of days got me to thinking about that aspect of his rise and downfall, because there were people at Lincoln even a couple years after the collapse who truly believed that Keating could have pulled himself out if outside entities -- the feds, I presume -- hadn't gone after him. His "model" was still seen as viable.

So now this morning I'm wondering if the housing bubble wasn't a form of collateral damage, and that the shruggers USED it as a cash cow to fund their other speculative ventures. After all, the debt on Frannie is only what, $5T, but we've got hundreds of trillions in derivatives out there?

Seems to me, and I guess what I'm asking for is some kind of confirmation or refutation of the theory (and it may be a :tinfoilhat: theory) that the housing bubble represents not so much a failure inthe fundamentals but instead was a means to an end, and its bailout is, similarly, nothing more than a distraction. Fixing the housing situation, therefore, will NOT rescue "the economy" without a dramatic change in the underlying -- and by definition therefore the real fundamentals -- economic model.

After all, the failed leader at one of these mega-collapse entities is up for an $11M severance package or some such? I forget who; just saw it fleetingly on LBN. . . . .


As always,


Tansy Gold

[Demeter]

I See No Holes In Your Argument

The "consumer" (how I hate that monicker) is the ultimate, indeed, the ONLY cash cow in existence.

And policies have been directed at abusing that cow, to the point of death, now and before in other failed empires.

And all these severence packages will be converted to French Revolutionary Severence packages in the foreseeable future, or I miss my guess.

[Tansy_Gold]

65. FRS packages?? !!

That's what I meant in my "when do we start being afraid" post the other day.

Maybe there's a reason "Tale of Two Cities" was required reading when I was in high school. . . . .


After all, the American consumer is, or should be, identical to the American worker. And we all know what it is that generates real wealth. . . . .



Tansy Gold, tryin' to generate a little wealth, or at least grocery money, of her own

[Demeter]

70. I Missed It--What are FRS Packages?

The American consumer is everyone. The worker class is a subset. Children, the elderly, the disabled are frequently although not invariably, not part of the workforce, and some never will be. Some workers, like mothers at home, or children caring for parents, are never properly accounted for or rewarded.

Furthermore, it's rather silly to separate American and non-American. Nations are not intrinsically real; the are mental constructs and subject to ideological and factual abuse. Nations don't exist if we say they don't, and exist if we affirm them. No man is an island, unless he says he is.


Oh, I get it. FRS! HAHAHAH! Only for those that have earned it, mind you! Not like that Robbespierre guy going to excess.

[Tansy_Gold]

73. Uh, you're the one who mentioned

"French Revolutionary Severance" packages. . . . . . . .


:hi:

(need some donuts? coffee?)


And oh, of course I recognize that there are others in the consumer "class" who are not directly workers. But without workers, without labor to produce the wealth for whatever consuming unit is involved -- family, self, community, etc. -- there can be no consumption.

I've always found it slightly amusing -- but more enfuriating than amusing -- that much domestic work performed by women is never quantified into a cash value, because the consumption of that labor isn't calculated either. And this permeates just about all economies, whether national or tribal, formal or informal, or whatever. Much of women's domestic labor -- care-giving, food-production, etc. -- is immediately consumed within the unit, and without it the unit would not survive.


Tansy Gold, where it's still very early in AZ

[Loge23]

31. Now the horizon is 2010

It's as far out as most of us can see, economically. Last year, I was calling late '08 for my business.
By next year, early to mid 2009, we'll probably be calling 2011. We're in this deep.

[ozymandius]

2. Today's Reports

08:30 Initial Claims 09/13
Briefing.com 440K
Consensus 440K
Prior 445K

10:00 Leading Indicators Aug
Briefing.com -0.2%
Consensus -0.2%
Prior -0.7%

10:00 Philadelphia Fed Sep
Briefing.com -10.0
Consensus -10.0
Prior -12.7

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

[UpInArms]

50. Initial Claims @ 455,000

01. U.S. 4-wk. avg. continuing jobless claims rise to 3.46 mln
8:31 AM ET, Sep 18, 2008

02. U.S. continuing jobless claims fall 55,000 to 3.47 million
8:31 AM ET, Sep 18, 2008

03. U.S. 4-wk. avg. initial jobless claims up 5,000 to 445,000
8:31 AM ET, Sep 18, 2008

04. U.S. weekly initial jobless claims rise 10,000 to 455,000
8:31 AM ET, Sep 18, 2008

[Pale Blue Dot]

51. Initial claims 455K. Much higher than expected. nt

[UpInArms]

94. U.S. Aug. leading indicators fall 0.5%

01. U.S. Aug. leading indicators fall 0.5%
10:02 AM ET, Sep 18, 2008

[UpInArms]

96. U.S. Sept. Philly Fed 3.8 vs. -12.7 in Aug.

03. U.S. Sept. Philly Fed above consensus -10.0
10:01 AM ET, Sep 18, 2008

04. U.S. Sept. Philly Fed 3.8 vs. -12.7 in Aug.
10:01 AM ET, Sep 18, 2008

[UpInArms]

129. U.S. 2Q household mortgage debt up 0.8% rate, lowest ever

01. U.S. 2Q total debt grows 3.5% annual rate, 14-year low
12:01 PM ET, Sep 18, 2008

02. U.S. 2Q household net worth falls 1.9% annual rate
12:01 PM ET, Sep 18, 2008

03. U.S. 2Q household mortgage debt up 0.8% rate, lowest ever
12:01 PM ET, Sep 18, 2008

04. U.S. 2Q household debt rises 1.4% rate, lowest on record
12:01 PM ET, Sep 18, 2008

[ozymandius]

3. Oil falls as investors eye US financial turmoil

SINGAPORE - Oil prices fell Thursday in Asia to $96 a barrel on concerns the deepening turmoil in the U.S. financial system will slow global economic growth and cut oil demand.

Light, sweet crude for October delivery fell 97 cents to $96.19 a barrel in electronic trading on the New York Mercantile Exchange midafternoon in Singapore. Overnight, the contract rose $6.01 to settle at $97.16, after dropping $10.03 the previous two trading sessions.

Oil jumped overnight as investors fled equities to crude as a short-term safe haven amid global market turmoil.

.....

Also Wednesday, the U.S. government reported a bigger-than-expected drop in crude supplies, reflecting the shutdown of virtually all Gulf Coast oil production because of Hurricane Ike and Hurricane Gustav.

.....

In other Nymex trading, heating oil futures fell 3.47 cents to $2.79 a gallon, while gasoline prices dropped 5.19 cents to $2.411 a gallon. Natural gas for October delivery rose 24.6 cents to $8.156 per 1,000 cubic feet.

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

[ozymandius]

4. Another nightmare on Wall Street: Dow down 450

NEW YORK - The stock market took another nosedive Wednesday as the American banking system appeared even shakier and investors worried that the financial crisis is spinning so far out of control that even government rescues can't stop it.

The Dow Jones industrial average, which only two days earlier had suffered its steepest drop since the days after the Sept. 11 attacks, lost another 450 points. About $700 billion in investments vanished.

.....

The Treasury Department, for the first time in its history, said it would begin selling bonds for the Federal Reserve in an effort to help the central bank deal with its unprecedented borrowing needs.

Treasury officials said the action did not mean that the Fed was running short of cash, but simply was a way for the government to better manage its financing needs.

.....

A $62 billion money market fund — Primary Fund from Reserve — on Tuesday saw its holdings fall below its total deposits, a condition known as "breaking the buck" that hasn't happened to a money market fund since 1994, Rosenberg said. Money market funds are supposed to be conservatively invested and almost as safe as cash.

http://news.yahoo.com/s/ap/20080918/ap_on_bi_ge/financial_meltdown

[ozymandius]

5. Bush cancels fundraising trip to deal with economy (some levity for the morning)

WASHINGTON - With the financial markets in turmoil, President Bush canceled a planned trip to Alabama and Florida on Thursday to consult with his economic advisers in Washington.

.....

The last few weeks have seen enough Wall Street turmoil and corporate collapses to prompt a blitz of federal interventions under Bush's watch. It is the kind of taxpayer-supported help for the private sector that might seem at odds with Bush's conservative, free-market economic philosophy.

.....

He has not fielded questions about the economic upheaval this week and even canceled a statement Tuesday. Reporters have tried each day. When one tried to press Bush in the Oval Office on Wednesday, he said he could not hear the question, and then made light of the moment by saying, "I'm old."

http://news.yahoo.com/s/ap/20080918/ap_on_go_pr_wh/bush_markets

---

Heavens help us if he feels the need to open the piehole.

[Antionehoboutsis]

18. mmm

typical

[Demeter]

23. He OUGHT To Be Fund-Raising for the Treasury and the Fed

Directing that money to pay the national debt.

[radfringe]

6. Hoover Revisited

Herbert Hoover - Hoover and the economy
http://www.experiencefestival.com/a/Herbert_Hoover_-_Presidency/id/1462887

Hoover's stance on the economy was based on volunteerism. From before his entry to the presidency, he was among the greatest proponents of the concept that public-private cooperation was the way to achieve high long-term growth. Hoover feared that too much intervention or coercion on behalf of the government would destroy individuality and self-reliance, which he considered to be important American values. Though he was not averse to taking action which he considered was in the public good - such as regulating radio broadcasting and aviation, he preferred a voluntary, non-government approach.

In June 1931, to deal with a very serious banking collapse in Central Europe that threatened to cause a world-wide financial melt-down, Hoover issued the so-called Hoover Moratorium that called for a one-year halt in reparations payments by Germany to France and in the payment of Allied war debts to the United States. The Hoover Moratorium had the effect of temporarily stopping the banking collapse in Europe. In June 1932, a conference was held in Switzerland that cancelled all reparations payments by Germany.

Hoover's economy was put to the test with the onset of the Great Depression in 1929. It was his vocal stance on non-intervention that led to public perception that he was a laissez-faire, 'do nothing' president, which his supporters deny.**

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

**The markets will take care of it - sound familar?

==================================

few quotes from Herbert Hoover:

http://thinkexist.com/quotes/herbert_hoover/

“It is just as important that business keep out of government as that government keep out of business”

-----

http://www.brainyquote.com/quotes/authors/h/herbert_hoover.html

Economic depression cannot be cured by legislative action or executive pronouncement. Economic wounds must be healed by the action of the cells of the economic body - the producers and consumers themselves.

-----

I'm the only person of distinction who has ever had a depression named for him.

-----

It is a paradox that every dictator has climbed to power on the ladder of free speech. Immediately on attaining power each dictator has suppressed all free speech except his own.

-----

Let me remind you that credit is the lifeblood of business, the lifeblood of prices and jobs.

-----

Prosperity cannot be restored by raids upon the public Treasury.

-----

When there is a lack of honor in government, the morals of the whole people are poisoned.

-----

When we are sick, we want an uncommon doctor; when we have a construction job to do, we want an uncommon engineer, and when we are at war, we want an uncommon general. It is only when we get into politics that we are satisfied with the common man.

[ozymandius]

8. Wow! Hoover was Milton Friedman's inspiration.

Conversely, he inspired Keynesian economics. That list of quotes may sound like a list of sage quotes. They do, however, underline the faults of his economic policies. Sometimes government must provide an economic stimulus when it puts money into the hands of people who will use it. Bernanke still needs to learn that lesson.

[radfringe]

34. some may think money grows on trees

maybe it does, however for the tree to grow it starts as a seed/nut in the ground. With proper care and nurturing, it will grow and produce fruit for all of us.

the basic element of any economy is labor, without labor you have no economy. the repub view is more of a creationist one, where some "higher being" proclaims "let there be money" and money appears.

[ozymandius]

7. Morgan Stanley Said to Mull Deal; Wachovia Calls Mack (Update3)

Sept. 17 (Bloomberg) -- Morgan Stanley is weighing a merger with Wachovia Corp. and several other banks as the securities firm seeks to regain investor confidence after its shares sank 42 percent this week, people familiar with the matter said.

John Mack, Morgan Stanley's chief executive officer, received a call from Wachovia today indicating interest, said one person, who declined to be identified because the talks aren't public and may end without an agreement. Such a deal is one option being considered and the New York-based firm also is seeking ways to limit short sales of its stock, said the person. CNBC reported that Morgan Stanley is in talks to possibly be acquired by China's Citic Group, citing an unidentified person.

.....

Morgan Stanley and Goldman, the biggest U.S. securities firms, tumbled the most ever after a government rescue of American International Group Inc. failed to ease the credit crisis. The cost to protect against a default by the Wall Street firms rose to a record. Wachovia, the fourth-largest U.S. bank, plunged 21 percent after saying it would support $494 million of Lehman Brothers Holdings Inc. credits held by its Evergreen Investments money market funds.

.....

Analysts including David Trone at Fox-Pitt Kelton Cochran Caronia Waller have said the demise of Lehman and Merrill may force Goldman and Morgan Stanley to pursue a sale or some sort of transaction with a bank, to gain a stable funding base of deposits and the confidence of the markets. The firms hold more than $20 of assets for every $1 in capital, making them dependent on lenders.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aq7MVYNcRHKY&refer=news

[ozymandius]

10. Money Market Funds Enter a World of Risk

...

On Tuesday, the Reserve Primary Fund, a giant money market fund whose parent helped invent that investment, said its customers would lose money. Instead of each share being worth a dollar for every dollar invested, it said its customers’ shares were worth only 97 cents. In Wall Street parlance, it “broke the buck,” a rare occurrence.

So far, it appears that no other money market funds have fallen below a dollar a share. And other money market managers have hastened to reassure investors that their money is safe. But the Primary Fund’s announcement did raise this question: What, in today’s world, is truly safe?

After all, the Primary Fund’s troubles did not occur in isolation. They followed the disappearance of both Lehman Brothers and Merrill Lynch, not to mention the government bailouts of the mortgage finance giants Fannie Mae and Freddie Mac and the insurance company American International Group. And if you haven’t already forgotten, there was the failure of the California thrift IndyMac in July.

...

Before you pull your cash out of your money market fund, you need to understand what you own. There is a big difference between money market mutual funds and the money market deposit accounts at a bank (and banks sometimes sell both).

http://www.nytimes.com/2008/09/18/business/yourmoney/18money.html?ref=yourmoney

[Buttercup McToots]

12. The Great Unwind Has Begun

http://www.nakedcapitalism.com/2008/09/great-unwind-has-begun.html

Thursday, September 18, 2008
The Great Unwind Has Begun


The credit markets had a seizure on Wednesday. To recap the mind-numbing events:

Three month T-bills finished at a two basis point yield, and may even have traded at negative yields. Signs of ZIRP.

Gold rose $68 and is still going up in Asia. The dollar fell against the yen, a sign of continued carry trade unwinds.

Credit default swaps on financials blew out, with Morgan Stanley hard hit: Spreads on protection for its bonds rose 220 basis points to over 900.

The TED spread, an indicator of stress in the interbank lending markets, shot upwards to 238 basis points.

CDS spreads on Treasuries rose to 30 basis points. Nine months ago, CDS on Treasuries were an oddity rather than an actively written contract, and the spread was 2 basis points.

Swap spreads widened considerably.

Today's TSLf auction was, as Alea put it, a "disaster" with prices and bid to cover up big time.

And the commentary was far from cheery. Kenneth Rogoff, in a Financial Times commentary, said that the US needed a trillon to two trillion dollar bailout. That may seem like a made-up number, and any estimate of the outcomes of an eruption this large is bound to be plenty approximate. However, Rogoff has made an extensive study of financial crises, so it would be a mistake to assume that he made this estimate casually. From the Financial Times:

Were the financial crisis to end today, the costs would be painful but manageable.... Unfortunately, however, the financial crisis is far from over, and it is hard to imagine how the US government is going to succeed in creating a firewall against further contagion without spending five to 10 times more than it has already, that is, an amount closer to $1,000bn to $2,000bn.....

It is hard to predict exactly how and when the mega-bail-out will evolve. At some point, we are likely to see a broadening and deepening of deposit insurance, much as the UK did in the case of Northern Rock. Probably, at some point, the government will aim to have a better established algorithm for making bridge loans and for triggering the effective liquidation of troubled firms and assets, although the task is far more difficult than was the case in the 1980s, when the Resolution Trust Corporation was formed to help clean up the saving and loan mess.

Of course, there also needs to be better regulation. It is incredible that the transparency-challenged credit default swap market was allowed to swell to a notional value of $6,200bn during 2008 even as it became obvious that any collapse of this market could lead to an even bigger mess than the fallout from subprime mortgage debt.

It may prove to be possible to fix the system for far less than $1,000bn- $2,000bn. The tough stance taken by regulators this past weekend with the investment banks Lehman and Merrill Lynch certainly helps.

Yet I fear that the American political system will ultimately drive the cost of saving the financial system well up into that higher territory.

An interesting observation in comments at Nouriel Roubini (hat tip Megan):

....the situation in the markets right now reminds me a lot of the time back in 1987 before the big October crash. At that time, during Sep and Oct there were some big swings in volatility in the Dow. The swings came about because investors were very nervous about a possible collapse, then every so often the market would decide that "everything is alright" and bounce up again. We're seeing that phenomenon again now. Back in 1987 one of the big drivers of the crash was "portfolio insurance". Brokers had implemented a scheme whereby stock portfolio's were supposedly insured in value through hedging transactions in the futures markets. Of course, the whole scheme only works if losses can be kept modest and predictable in nature. The market tore apart initially in the Chicago futures markets when the scheme began to break down. This time in 2008 the issue is not stock insurance ... it's bond insurance. The market is now very nervous about a possible collapse in the CDS market. Different asset - but the same underlying issue. The insurance on bond values just can't be paid up when losses become large and unpredictable in the system. (Pete)CA)

From Ambrose Evans-Pritchard at the Telegraph:

Bernard Connolly, global strategist at Banque AIG, said the Fed and the Treasury were doing too little, too late, to stave off disaster. Interest rates need to be cut immediately and dramatically, while Washington must prepare for a wholesale takeover of large parts of the lending system along the lines of the Scandinavian bank rescues in the early 1990s.

"Unless there is a very rapid change of mind, depression - with all its horrors and consequences - will be inevitable. The judgment that letting Lehmans go would not create systemic risk depended, if it was ever going to be anything other than ludicrous, on very rapid action to shore up the financial system. Instead, Hank Paulson seems to be adding to the risk in the system," he said.

"We fear that a virtual nationalisation of the financial system will now be necessary," he said....

Albert Edwards, global strategist at Société Générale, said Washington's serial bail-outs are the inevitable result of the credit bubble of preceding years. "This was all baked in the cake long ago. What we have seen so far is just a dress rehearsal for the deep recession that is coming. America is going to be losing 500,000 jobs a months. That is when we will see interest rates go to zero. The deficit will be covered with printed money as it was in Japan. The endgame will be helicopters full of cash dropped by Ben Bernanke," he said.

And from the Financial Times:

Andrew Brenner, co-head of structured products and emerging markets at MF Global, said: “It feels like no one wants to take anyone’s credit...it feels like we are on a precipice.”

[Antionehoboutsis]

16. whish the article was correct

but I wouldnt count on it

[Demeter]

22. I Doubt Anything Could Stop the Oncoming Depression

It has 30 years of preparation and 8 years of active pushing behind it. That rock is ready to roll downhill, unimpeded by any safety nets or impediments or firewalls.

[DemReadingDU]

47. Ted Spread now 3.13, FEAR is getting stronger

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


See explanation about Ted Spread
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3491922&mesg_id=3492004

[Buttercup McToots]

13. "People are scared to death,"

Stocks tumble after government bailout of AIG

By TIM PARADIS, AP Business Writer 52 minutes ago

"People are scared to death," said Bill Stone, chief investment strategist for PNC Wealth Management. "Who would have imagined that AIG would have gotten into this position?"

He said the fear gripping the markets reflects investors' concerns that AIG wasn't able to find a lifeline in the private sector and that Wall Street is now fretting about what other institutions could falter. Over the past year, companies including Lehman and AIG have sought to reassure investors that they weren't in trouble, and now the market isn't sure who can and can't be trusted.

"No one's going to be believing anybody now because AIG said they were OK along with everybody else," Stone said.

The Fed's moves left the market worried about problems that might worsen at other financial companies.

http://news.yahoo.com/s/ap/20080917/...re/wall_street

[ozymandius]

15. Oh, by the way, tomorrow is a Quadruple Witching day.

So many futures contracts are set to expire. Volatility is assured.

[54anickel]

71. Oh shit!!! Our meager retirement portfolios can't take much more. Poor BIL has

decided to put off his retirement. He's just thankful this has been happening BEFORE he gave notice. He lost a bundle considering the mix he was holding.

[Hugin]

91. Just yesterday I was told what a great deal 401(kleptos) were...

Right here on DU!

[54anickel]

105. No way and WTF? Someone working for a provider? Gonna be REAL interesting

to see what transpires with those deferred tax accounts in the future when the rules begin to sunset.

[Antionehoboutsis]

19. scared-yes

o death-I dunno

[ozymandius]

14. Insurers See Garage Sale of AIG Lines

The insurance industry is gearing up for a gargantuan garage sale.

The government on Tuesday took over giant insurer American International Group Inc., and the industry expects the company to sell off assets. Exactly how remains unclear.

....

The company's units are major players in many different types of insurance, so a key question is whether Mr. Liddy will try to sell some or all of the units, or try to repay the government's loan to AIG while keeping the company largely intact.

....

Some industry players may be eager to buy AIG's insurance operations to jump-start their own businesses. But the field of potential buyers may be thinned by some would-be buyers' own financial woes as they seek to weather the tough markets.

Industry executives anticipate a number of third-quarter write-downs, as declining stock markets hit annuity businesses in particular. Many companies are expected to write down the value of securities in their investment portfolios tied to troubled financial-service firms. Wednesday, Prudential Financial Group Inc. became one of the first insurers to flag expected charges tied to Lehman Brothers Holdings Inc., an investment bank in bankruptcy court since early this week, and said it is evaluating a possible charge tied to AIG holdings.

http://online.wsj.com/article/SB122170033024650631.html?mod=googlenews_wsj

[Tansy_Gold]

83. Can you expain this in terms a doofus like me can understand?

When the government "takes over" AIG, what happens to the stock and the stockholders? Do they continue to hold the stock, if they wish, but it's worthless? If AIG gets somehow turned around to be profitable again and actually does pay back the $85B, does the stock then become whatever it was before the bailout?

If AIG's insurance arm is viable, why can't they unwind operations in the non-profitable sectors and just conduct business in insurance?

All this talk of insuring against defaults: Does mean that --

Company A buys bonds from Company B, in anticipation of getting repaid.
Company A buys insurance from Company C, just in case Company B doesn't pay off the bonds (or other securities????)
As Company C sees Company B engaging in risky business, they up the cost of insurance.
Company A is now paying out more in insurance than the Company B bonds are worth, but they have to protect their investment?

Is this sort of what's going on or do I have it completely wrong?




Tansy Gold

[Robbien]

157. Just heard this wild idea about swap derivatives

If all these broker dealers go away through bankruptcies or govt take-overs and the only one left standing is Goldman, then the swap derivatives go away. They said that these swap deals are swaps between two parties but if only one party is left standing, there are no more deals.

Huh?

[Tansy_Gold]

180. Makes sense to me!

:wtf:


Tansy Gold???????

[Demeter]

182. The Morons Just Make It Up As They Go Along

They are all sitting on folders of shiny, colorful, worthless pieces of paper, looking for a greater fool to buy them. Well, Uncle Sap just did.

[ozymandius]

20. Russia exchanges restart some trading, not stocks

MOSCOW, Sept 18 (Reuters) - Russia's exchanges restarted some trading on Thursday, but stocks trading remained suspended until further notice following the sharp sell-off earlier this week.

The MICEX exchange said it had re-started repo trading from 0700 GMT, with all the normal instruments accepted as collateral, including bonds and shares.

The RTS exchange was trading futures contracts for goods, currency and interest rates.

However, Russia's markets watchdog kept the country's two stock exchanges closed and said it had indefinitely suspended margin trading, when investors effectively borrow money from the broker to do their trades, and short selling, which bets on a fall in an asset's price.

http://www.forbes.com/afxnewslimited/feeds/afx/2008/09/18/afx5440304.html

[UpInArms]

92. Russia to spend $20bln to support mkt, to reopen Friday

http://www.reuters.com/article/bondsNews/idUSLI41696320080918

MOSCOW, Sept 18 (Reuters) - Russia will assign 500 billion roubles ($19.59 billion) to support and stabilise the stock markets, where trade will resume on Friday, the country's leaders said on Thursday. President Dmitry Medvedev said that half of the 500 billion roubles will come from the budget, and that further measures could be taken if necessary.

In addition, Finance Minister Alexei Kudrin said Russia's mortgage agency will get a cash injection of 60 billion roubles, while major banks Sberbank (SBER03.MM: Quote, Profile, Research, Stock Buzz), VTB (VTBR.MM: Quote, Profile, Research, Stock Buzz) and Gazprombank will lend 60 billion roubles to stock market players.

Kudrin also said that the first auction of the three-month budget funds to be put on deposits at the three banks will be held on Monday.

[Demeter]

24. Another Timely Toon

I think Merrill Lynch is getting off easy, myself.

[Loge23]

25. Classic toon - it says it all (eom)

[Demeter]

28. And Today's Musical Theme: A Parody! "You've Got the Fed" (You've got a friend)

http://www.nakedcapitalism.com/2008/09/comic-relief-youve-got-fed.html

Excellent quality!

[Demeter]

32. And Then, There's The Unintentional Humor of the NYTimes Business Column

http://www.nytimes.com/2008/09/17/business/17leonhardt.html?_r=1&adxnnl=1&oref=slogin&ref=business&adxnnlx=1221735996-RskEDqhn3vmFejYCJbrB8Q







Perhaps, It’s Time to Play Offense By DAVID LEONHARDT



WASHINGTON — Late last week, as Lehman Brothers was collapsing, an all-star group of economists was meeting here to ponder the lessons of the financial crisis. The group included Donald Kohn, the vice chairman of the Fed, and Edward Lazear, the top White House economist, as well as Lawrence Summers, the former Treasury secretary, and a few dozen others.

The discussion revolved around a handful of academic research papers, but it really boiled down to this: How do we get out of this mess?

At one point, Benjamin Friedman of Harvard raised his placard to inject a little sunshine into the room. If somebody had told the economists a year and a half ago what was about to befall Wall Street and then asked them to predict the economic impact, Mr. Friedman said, they almost certainly would have forecast a steeper downturn, with many more layoffs, than has occurred.

The fact that it hasn’t, so far, should be considered a victory for Ben Bernanke and Henry Paulson, the point men on the crisis. After some early missteps, they have acted aggressively to keep the financial system functioning — including Tuesday’s stunning takeover of A.I.G. — while still forcing Wall Street to suffer for its sins. The problem, unfortunately, is that neither man has done much to deal with the problems that caused the crisis in the first place....


GIVE IT A WEEK, DAVE. YOU'LL SEE ALL THE LAYOFFS YOU WANT.

[Dr.Phool]

39. There really are crazy people out there.

And, isn't it there job to see a train wreck coming, and try to prevent it in the first place?

[Dr.Phool]

33. I think they sold the bull in their commercials to Burger King.

[Ghost Dog]

26. European markets steady after concerted central bank liquidity action

Overnight story here: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3496630#3496690
________

European shares rises further, led by banks
Thu Sep 18, 2008 5:54am EDT

LONDON, Sept 18 (Reuters) - European shares extended gains in mid-morning trade on Thursday, led by banks after major central banks poured billion of dollars into the money markets to ease liquidity strain.

The FTSEurofirst 300 index of top European companies was up 1.1 percent at 1,081.92 by 0949 GMT.

/.. http://www.reuters.com/article/marketsNews/idCALI46438920080918?rpc=44

[Ghost Dog]

27. WRAPUP 3-Cenbanks turn on funding taps to tackle mkt squeeze

FRANKFURT/TOKYO, Sept 18 (Reuters) - The world's top central banks said on Thursday they will pump more than $180 billion in extra dollar funds into global money markets in a coordinated effort to ease a funding squeeze triggered by the upheaval on Wall Street.

The European Central Bank joined forces with the U.S. Federal Reserve and the central banks of Canada, Switzerland, Japan and Britain to boost supplies of dollar funds in global financial markets.

The ECB and the Bank of England offered $40 billion in one-day dollar funds, and Swiss National Bank will add up to $10 billion in the central banks' first-ever loans of overnight dollar liquidity.

The Fed said it was extending currency swap arrangements with other central banks by $180 billion to fund the extra liquidity operations, which come on top of central bank actions to pump in extra cash in their local currencies.

In a sign of the huge demand for sterling funds, banks bid 202.03 billion pounds for the 66.21 billion pound on offer in a Bank of England open market operation.

Well-oiled money markets, where banks lend short term funds to each other to smooth out daily swings in their balances, are crucial for the proper functioning of the financial system and the economy at large.

/... http://www.reuters.com/article/marketsNews/idINSP12952120080918?rpc=44&sp=true

[Ghost Dog]

29. HIGHLIGHTS-Policy maker comments on c.bank action, crisis

SINGAPORE, Sept 18 (Reuters) - Policy makers and central banks globally have mobilised to try to calm investors and prevent the upheaval on Wall Street from sending financial markets into a dizzying sell off.

The following are highlights of comments from policy makers on Thursday.

FEDERAL RESERVE, BANK OF CANADA, BANK OF ENGLAND, EUROPEAN CENTRAL BANK, SWISS NATIONAL BANK, BANK OF JAPAN, COMMON LINE IN ALL STATEMENTS ANNOUNCING CO-ORDINATED ACTION:

"These measures, together with other actions taken in the last few days by individual central banks, are designed to improve the liquidity conditions in global financial markets. These central banks continue to work together closely and will take appropriate steps to address the ongoing pressures."

/continues... http://www.reuters.com/article/marketsNews/idINSP36328120080918?rpc=44

[Ghost Dog]

176. Ok. Was a flop. Europe stocks fall despite liquidity boost

Thu Sep 18, 2008 1:02pm EDT

PARIS, Sept 18 (Reuters) - European stocks ended lower on Thursday after a rollercoaster session, as a coordinated move by the world's leading central banks to ease the credit squeeze failed to halt the equities selloff that started on Monday.

The FTSEurofirst 300 index of top European shares closed 0.6 percent lower at 1,063.62 points, falling for the fourth straight session and ending at its lowest closing level since April 2005.

The index has lost around 9 percent so far this week, and is on track for its biggest weekly drop since the attacks of Sept 11, 2001. The declines follow Lehman Brothers' (LEH.P: Quote, Profile, Research, Stock Buzz) collapse, the takeover of Merrill Lynch (MER.N: Quote, Profile, Research, Stock Buzz) and the bailout of insurer AIG (AIG.N: Quote, Profile, Research, Stock Buzz).

"There are a lot of pending issues in the financial sector, and probably a lot of bad surprises in the pipeline," said Jean-Claude Petit, head of equities at Barclays Wealth Managers France. "This crisis constitutes a turning point in the business model of banks and the way Wall Street works. Consolidation among banks is inevitable. But these are "arranged marriages" under the pressure of the U.S. authorities."

The world's top central banks joined forces on Thursday to throw a multi-billion dollar lifeline to global markets in a dramatic effort to free up bank-to-bank lending, frozen by the turmoil on Wall Street. In an unprecedented move, the U.S. Federal Reserve made an extra $180 billion available to major central banks to lend on to their local commercial banks in a bid to get dollars circulating in overnight and term money markets.

European banking stocks, which had had a tentative recovery earlier in the session, ended the day mixed.

UK lender HBOS Plc (HBOS.L: Quote, Profile, Research, Stock Buzz) jumped 17 percent after Lloyds TSB (LLOY.L: Quote, Profile, Research, Stock Buzz) said it would take over the embattled UK lender in a $22 billion deal helped through by the government. Lloyds sank 15 percent. Barclays (BARC.L: Quote, Profile, Research, Stock Buzz) was down 5.3 percent, Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) down 4.5 percent, while BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz) rose 3 percent and Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz) gained 2.8 percent.

"Recent events should not come as a surprise to those who, like us, see the U.S. economy sliding into deep recession as a result of long years of grotesque debt excess," Albert Edwards, strategist at Societe Generale, wrote in a note. "Amid recent chaos, few realise that the next phase of de-leveraging has only just started."

/... http://www.reuters.com/article/marketsNews/idCALI1292920080918?rpc=44&sp=true

_______

So now the knives are really out. Hmmm. Well, since Prag has locked himself in the pool, I think I'll head for the Swiss Alps myself with Claudine and Claudette, on the excuse it's time to make sure the vaunted vaults are still safe.

[radfringe]

37. few oldies

dancing around the question

[DemReadingDU]

48. Love your toons!

Missed your creativity, do you still have a website?

[radfringe]

64. no, let it lapse

don't have the time with my job and hour commute (each way)

I do have a blog,
http://stone-waves.blogspot.com/

and when I do find some time, I've been playing with videos

http://www.youtube.com/watch?v=GvtKGNvJ5u4

http://www.youtube.com/watch?v=z_nN91GtiH8

http://www.youtube.com/watch?v=GvtKGNvJ5u4

[Hugin]

97. Yay! radfringe toons!

:bounce:

[UpInArms]

40. dollar watch

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

Last trade 77.575 Change -0.583 (-0.74%)

US Dollar Vulnerable To Weakness On Fed Cut Expectations, Financial Instability

http://www.dailyfx.com/story/bio1/US_Dollar_Vulnerable_To_Weakness_1221690225618.html

The US dollar fell sharply on Wednesday as the markets are now weighing the odds of a rate cut before the end of the year. This is exactly the sort of trigger I was talking about yesterday when I cited by my bearish fundamental bias for the US dollar, as the previous rally was fueled by expectations of future interest rate increases. However, with the FOMC now signaling no change in rates going forward and possibly considering cutting rates, that impetus has been removed. Indeed, much to the dismay of the Fed, their intervention in AIG failed to soothe investors’ fears about the health of the markets, as indicated by the 4% or more drops in the DJIA and S&P 500. These moves were led by declines in financials, as shares of the two remaining “big 5” investment banks fell by the most on record. This risk aversion also translated into massive flight-to-safety toward US Treasuries, as yields on 3-month Treasury bills fell to a 54-year low. (Check out our US Trading Summary). Putting the focus back on the Federal Reserve, fed fund futures are fully pricing in a 25bp cut on October 29 and a 34 percent chance of a 50bp cut. Meanwhile, Credit Suisse overnight index swaps are close to pricing in a 25bp cut within the next 12 months, compared to expectations for a 25bp hike just last Friday. Clearly, the markets have taken the Fed’s more neutral stance to heart following the FOMC rate decision and policy statement on Tuesday, and as a result, the US dollar will remain vulnerable to additional decline. Thus, my fundamentals bias for the US dollar remains bearish.

...more...

U.S. Treasury Bill Rates Drop to Lowest Since 1954

http://www.dailyfx.com/story/topheadline/Extraordinary_Market_Conditions_Dries_up_1221664762744.html

Today, the 3-month US Treasury Bill yield fell to the lowest since 1954. Dramatic declines in US T-Bill yields underline the level of risk aversion in global financial markets, as traders around the world move their funds into risk-free US government debt. Such dynamics should continue to support lower-yielding currencies such as the Japanese Yen, which likewise appreciates during times of financial market risk aversion.

The overall level of market risk aversion can clearly be seen in the difference between the T-Bill rate and the equivalent money market yield. Indeed, the chart below shows that the Treasury-LIBOR spread now stands at its highest levels since the US stock market crash of October, 1987. Intense global fears on the state of financial markets have likewise had a clear effect on liquidity available across global dealing desks, as major financial institutions become unwilling to lend money and significantly scale back position risk across various assets.



Financial market disruptions thus translate into nearly-unprecedented volatility across key asset classes, and forex markets have seen historic volatility as of late. Indeed, our DailyFX 1-week volatility index is now at its highest since the inception of the euro—underlining financial market duress and fears that extreme price moves may continue through the coming days.



...more...

Pound Rebounds On Strong Retails Sales, Central Banks Unite To Provide Liquidity.

http://www.dailyfx.com/story/topheadline/Pound_Rebounds_On_Strong_Retails_1221731513519.html

The major central banks announced a coordinated effort to provide liquidity to the markets with the BoE, ECB, BoJ, BoC, and SNB involved in a $180 billion infusion. The Fed authorized the auction in order to help unfreeze credit markets which have been crippled by the Lehman Brothers bankruptcy as fears have grown that more banks will fail before the crisis ends. The news would lead to initial bullish dollar price action across the majors, but those gains have since been erased.

The Pound saw whipsaw price action as rumors that the BoE would execute an emergency rate cut following the coordinated central bank effort led to the GBPUSD falling to support at 1.8100. An unexpected strong consumer consumption report would reverse momentum sending the Cable soaring over a 100 bps before finding resistance at 1.8250-helping the rally was denials from BoE officials that that a rate cut was imminent. Retail sales improved for a second month with a 1.2% gain in August following a 0.9% improvement the month prior. A 4.1% increase in clothing purchases led to the report printing better than the 0.5% decline that was expected by economists and gives the BoE room to leave rates unchanged for the near-term. Meanwhile, Lloyds announced the 12.2 billion pound purchase of HBOS, U.K.’s largest mortgage lender. The move was followed Hailifax Bank losing more than half its market value on the slumping U.K. housing market. The move will need special permission from regulators as it would give the bank 30% of the mortgage market. The move may bring stability to the housing market giving the central bank more reasons to leave their bias unchanged.

The Euro continued its gains from yesterday as the EURUSD broke above 1.4400 after a brief dip on the coordinated liquidity effort. The pair has found some resistance at the 20 day SMA which has served as a ceiling the past week. A clear break of this level could lead to the Euro looking to test the Fibo extensions of 1.4687 and 1.5082 as identified by Jaimie Saettele’s technical outlook.

A number of tier two indicators will cross the wires today with the Philadelphia Fed report with the most event risk potential. The manufacturing reading is expected to show a slight improvement which would be welcomed news as the New York and national reports last week showed weakness in the sector. The leading indicators report which measures the broader economic trends and their potential direction will also show that conditions are improving slightly but still skewed towards contraction going forward. However, the continued troubles of the investment banking sector and the concerns of more bank closures will continue to weigh on the dollar. The increasing expectations that the Fed will ease further has clearly reversed the greenback’s near term direction and weakness may remain until the central bank gives a clear sign that rate aren’t going lower.

...more...

[UpInArms]

42. ECB, Fed, others pump $180 Billion dollars into money markets

http://news.yahoo.com/s/ap/20080918/ap_on_bi_ge/eu_central_banks_dollars

FRANKFURT, Germany - The world's major central banks banded together on Thursday to inject as much as $180 billion into money markets in a bid to stave off the growing global financial crisis.

The European Central Bank said that it had joined with the Federal Reserve, the Bank of Canada, the Bank of England, the Bank of Japan and the Swiss National Bank to pump more short-term dollar liquidity into the financial system.

Credit markets have tightened since Monday after the weekend collapse of investment house Lehman Brothers Holdings Inc., and central banks already provided billions Monday and Tuesday in hopes of turning the tide and to keep fearful banks from hoarding cash.

In a statement, the Fed said it had authorized a $180 billion expansion of swap lines, or reciprocal currency arrangements, with the other central banks, including amounts up to $110 billion by the ECB and up to $27 million by the Swiss National Bank.

The Fed also said new swap facilities had been authorized with the Bank of Japan for as much as $60 billion; $40 billion for the Bank of England and $10 billion for the Bank of Canada.

"These measures, together with other actions taken in the last few days by individual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work together closely and will take appropriate steps to address the ongoing pressures," the Fed said in a statement on its Web site.

...more...

[UpInArms]

46. Fed provides additional $180 billion for short-term dollar auctions

http://www.marketwatch.com/news/story/central-banks-flood-credit-markets/story.aspx?guid=94F2A55B-5E97-4445-89EA-3E10D4B7D733&dist=SecMostRead

LONDON (MarketWatch) -- The world's biggest central banks moved Thursday to inject massive amounts of liquidity into the financial system in a bid to alleviate extreme distress in short-term, dollar-denominated money markets.

The Fed, in a statement, said it would use swap lines to provide other central banks with an additional $180 billion, which can be injected into money markets through overnight and term loans.

"I think this is recognition that the time for subtlety is past," said Russell Jones, head of fixed income and currency strategy research at RBC Capital Markets.
The move will allow the European Central Bank to auction as much as $110 billion in one-day and other short-term dollar loans to commercial banks in the 15-nation euro zone, up from its current level of $50 billion. The amount available through the Swiss National Bank was increased to $27 billion, a rise of $15 billion.

The Fed also authorized new swap facilities that will enable the Bank of Japan to provide $60 billion in dollar liquidity, $40 billion by the Bank of England and $10 billion by the Bank of Canada.

Credit crunched

Short-term borrowing costs had leaped this week.

Interbank lending ground to a virtual halt as banks grew increasingly wary of lending to each other after investment bank Lehman Brothers failed. The reluctance to lend came as institutions grew increasingly worried about their own capital levels as well as the soundness of other banks.

...more...

[Demeter]

49. $180 BILLION!

of what? Monopoly money?

[UpInArms]

52. prolly EFTs (electronic fund transfers) right into the CEOs' accts

:grr:

[Ghost Dog]

58. Please see #26 and follow link to earlier DU thread. The intention is to calm markets,

which are irrationally panicking thanks mainly to US media, at least for the moment.

[Roland99]

82. In order to trigger *another* sucker rally. NOTHING can stop the fall now

[UpInArms]

84. Fed adds $55 billion in repos to money markets

http://www.marketwatch.com/news/story/fed-adds-55-billion-repos/story.aspx?guid=%7B08C80470%2DFCF2%2D416B%2DA951%2DB5014A6E142C%7D

NEW YORK (MarketWatch) -- The Federal Reserve added another $50 billion in overnight loans on Thursday to help liquefy money markets, matching the amount offered twice already this week. The New York branch of the central bank uses repurchase agreements, or repos, almost every business day to meet demand from banks and primary dealers. The $50 billion is among the largest injections since the aftermath of the Sept. 11, 2001, terrorist attacks. The Fed also did its traditional 14-day repo for $5 billion and put out a release saying it "stands ready to arrange further operations later in the day, as needed." The U.S. central bank joined with its global counterparts again today to inject extra cash into the banking system.

[Roland99]

87. And this money comes from where? European Treasuries? ECB CEO's mattresses?

[UpInArms]

109. Central Banks Offer Extra Funds to Calm Money Markets (Update6) (now up to $247 Billion)

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

Sept. 18 (Bloomberg) -- The Federal Reserve almost quadrupled the amount of dollars central banks can auction around the world to $247 billion in a coordinated bid to ease the worst crisis facing financial markets since the 1920s.

The Fed increased the amount of dollars that the European Central Bank, the Bank of Japan and other counterparts can offer from $67 billion ``to address the continued elevated pressures in U.S. dollar short-term funding markets.'' The Bank of England, the Bank of Canada and the Swiss National Bank also participated.

Policy makers have struggled to revive confidence in markets this week as investors stockpiled money on concern more financial institutions would fail after the bankruptcy of Lehman Brothers Holdings Inc. and the U.S. government bailout of American International Group Inc. The cost to hedge against losses on U.S. government debt climbed to a record yesterday.

``There's a complete lack of faith in the markets,'' said Jim O'Neill, chief economist at Goldman Sachs Group Inc. in London. ``There's a lot of cash hoarding and people losing trust in banks, so the central banks are acting to relieve that. This might not be the last time they have to act.''

Markets welcomed the announcement, which was made in statements from each central bank at 9 a.m. Frankfurt time at the start of European trading. The cost of borrowing dollars overnight slid to 3.84 percent from 5.03 percent yesterday. It was 2.15 percent last week and reached the highest since 2001 on Sept. 15.

Limit Doubled

The Fed, which is adding $50 billion into its own banking system today, will spray dollars around the world via swap lines with other central banks. They can then auction them in their own markets. The ECB, Bank of England and Swiss National Bank allotted a total of $64 billion for one day today.

``The timing, so early in the trading day, shows both the severity of the strains in the interbank market and as well the authorities' determination to resuscitate orderly functioning of the money markets,'' said Julian Callow, head of European economics at Barclays Capital in London.

Under the new arrangements, the ECB doubled the limit of dollars it can get from the Fed to $110 billion and Switzerland's central bank can offer $27 billion, an extra $15 billion. New swap facilities with the Bank of Japan, the Bank of England and the Bank of Canada amount to $60 billion, $40 billion and $10 billion, respectively. The arrangements are authorized until Jan. 30.

...more...

[UpInArms]

43. How the Masters of the Universe ran amok and cost us the earth

http://thescotsman.scotsman.com/economicindicators/-How-the-Masters-of.4494032.jp

SLAM. Slam. Slam. Slam. Like a scene from a gathering of Mafia dons, the doors of 30 black Lincolns slammed shut as their besuited occupants stepped out into a Manhattan downpour – and into a global financial storm.
That storm broke yesterday, with stock markets tumbling around the world. In London, the FTSE 100 plunged almost 4 per cent to 5204.2. Scotland's banking giants were among the biggest victims. HBOS slumped 17.5 per cent; Royal Bank of Scotland lost 12.2 per cent. In the US, the Dow Jones industrial average suffered its biggest fall since 9/11.

The collapse effectively began at 6pm last Friday. The place: the offices of the New York Federal Reserve. The occasion: an emergency meeting of the most powerful figures in American banking and finance aimed at staving off a massive bank collapse.

Those who stepped from their limousines to be present included Richard Fuld, the chairman and chief executive of Lehman Brothers; John Mack, the head of Morgan Stanley; Jamie Dimon, of JP Morgan Chase; Vikram Pandit, of Citigroup; Lloyd Blankfein, of Goldman Sachs; Bob Diamond, the head of Barclays Capital; and senior representatives from Mellon Bank and Royal Bank of Scotland.

"We are the biggest overseas bank in America", explained an RBS spokeswoman. "There was an 'all points bulletin' from the Fed and they called us in".

Awaiting them along one side of the boardroom table was the United States Federal Reserve chairman, Ben Bernanke – nicknamed Helicopter Ben for having slashed interest rates and showered Wall Street with money earlier this year to avoid the very disaster that was about to unfold.

Flanking him was Hank Paulson, the US treasury secretary, and Tom Geithner, chairman of the New York Fed. It was Geithner who opened the meeting – and presented Wall Street's finest with the fright of their lives.

...more...

[Karenina]

59. Thanx for this!

[UpInArms]

44. Bubbleonomics & Greenspan's 'magic piggy banks'

http://www.marketwatch.com/News/Story/Story.aspx?column=Paul+B.+Farrell

excerpt:

Imagine Henry Paulson, former boss of Goldman Sachs, who a year ago appeared with Fed boss Ben Bernanke and made their now-famous joint denial dismissing the subprime-credit crisis: "Contained," they said. Total propaganda, totally false! After five years of regular warnings, only a truly tragic actor would have made such obvious lies a year ago.

So now we have two tragic actors, Ben and Hank, running America's two "Magic Piggy Banks."

"Black Swan" author Nassim Nicholas Taleb says: "Anyone who knows anything about the history of banking ... will tell you that the subprime crisis was so bound to happen banks have a tendency to sit on 'time bombs' while convincing themselves that they are conservative."

Paulson's excuse that he "was lied to" by congressional Democrats is at best a disingenuous cover-up. He's the former head of America's most successful investment bank; I can't imagine any Republican, let alone Bush's Treasury head, trusting the word of a Democrat -- it's not in their genes. His ideology obviously trumped his banker's natural instinct for due diligence.

Free market falsehoods, Reaganomics rolled over

What did the takeover of Fred-n-Fan teach us? The free-market system is dead, an outdated myth that for a long time conservatives only honored in the breach, while liberals still haven't caught on to this con-game. Paulson was repeating what Bernanke did just a few months earlier when he not only killed off Bear Sterns, he killed off free-market delusions with his historic bailout of Wall Street's incompetent bankers by opening of the discount window.

Yet, magically, conservatives won again, by losing again! As James Galbraith tells us in "The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too," conservatives gave up on free markets long ago. So they don't even pretend that the delusional free-market magic of Reaganomics will work to solve our economic problems; instead, conservatives milked the bull market till last summer, then went direct to the "Magic Piggy Banks."

And, predictably, the wimpy liberals caved in to this con-game. Now we have a classic "moral hazard," setting up a bigger meltdown soon.

No wonder America's financial credibility and leadership role are rapidly deteriorating worldwide as well domestically. Shiller captured the essence of all tragic drama: "Irrational exuberance is wishful thinking on the part of investors that blinds us to the truth of our situation." The truth is, all Reaganomics disciples, Paulson, Bernanke, Greenspan and everyone before them clearly saw the credit crisis coming years ago. So, it not "blind?" Then what? Two alternatives:

<snip>

"Intentional" Reaganomics Bubble-Blowers? In fact, they were never really "blinded." They were fully awake. Since 2000 they knew exactly what they were doing: Intentionally blowing a bubble during the bull phase, fully aware that America's "Magic Piggy Banks" would be forced to step in during the bear-recession phase to bail them out no matter how costly or stupid their catastrophes. In short: Reaganomics loves bubbles and bailouts, consistent with Friedman's classic edict that "only a crisis ... produces real change." And as Thomas Frank says in "The Wrecking Crew: How Conservatives Rule," that makes the elite richer.

...more...

[fed_up_mother]

53. Excellent article. Thanks for posting.

[UpInArms]

55. Uncle Sam taps piggy bank, borrows to aid market

http://news.yahoo.com/s/ap/20080917/ap_on_bi_ge/uncle_sam_s_piggy_bank?_ylt=Atcn1raAYvPQHiH_tCxoKeJv24cA

WASHINGTON - Where does Uncle Sam come up with huge sums of money during a financial emergency? Like the rest of us, the government taps its reserves and borrows if it needs more.

The federal government has pledged eye-popping amounts — more than $600 billion in the past year — to bail out, or help bail out, some of the biggest names in American finance. The latest was American International Group Inc.

Now the credit crisis is starting to tax even the Federal Reserve's deep resources.

On Wednesday, the central bank took the unprecedented step of asking the Treasury Department to sell debt on behalf of the Fed. The first of those auctions raised $40 billion, and two more to raise an additional $60 billion are scheduled for Thursday.

Analysts said these auctions don't mean that the Fed, the bank that backs up the U.S. banking system, is strapped for money. Instead, they said it represented an effort to better manage its own holdings of Treasury securities.

It uses those securities to control interest rates by buying or selling the securities to banks, thus raising and lowering the amount of money banks have to loan out and influencing the price of that money.

While the Fed has access to its fat piggy bank to support its effort to prop up financial companies, the Treasury Department will have to whip out the credit card for the support it is pledging to mortgage finance companies Fannie Mae and Freddie Mac.

Treasury will have to borrow the money because it doesn't have the deep reserves that the Fed does. The country is running a huge budget deficit this year and is projected to run an even bigger one next year.

...more...

freakin' jerks - the "piggy banks" were already broken into, remember?

:grr:


he estimated population of the United States is 304,749,929
so each citizen's share of this debt is $31,641.28.

[54anickel]

102. Bwahahaha!!! Gobble-gobble! n/t

[Pale Blue Dot]

54. When I woke up at 5:45, Dow futures were up nearly 100 pts.

They are now up 24.

I wonder what kind of a rally we'll see today.

[Loge23]

57. More wood for the bonfire?

The Central Banks are pouring $180B into the system in a "dramatic effort" to stimulate the credit markets.
We'll see.

http://news.yahoo.com/s/nm/20080918/bs_nm/financial_centralbanks_dc_4

[DemReadingDU]

60. Mike "Mish" Shedlock: It's not going to work

9/18/08 This effort will fail because the problem is a solvency issue not a liquidity issue.


"Today, the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank are announcing coordinated measures designed to address the continued elevated pressures in U.S. dollar short-term funding markets."
more...
http://globaleconomicanalysis.blogspot.com/2008/09/central-bank-global-coordinated.html

[Ghost Dog]

66. That's bullshit. There may be a solvency problem for some

mainly US-UK financial institutions, for sure. But there's a looming systemic credit/liquidity crisis for the rest of the financial universe, including ordinary businesses that provide ordinary jobs for ordinary people around the world.

The insolvent should indeed be eliminated, nationalized or whatever forthwith, and the contamination should not be permitted to spread to otherwise healthy sectors of the world's economies.

Otherwise, maybe US-UK really does need to be put into international economic quarantine...

[54anickel]

86. I don't think that economic quarantine is gonna fly - we'll take the world down with us

before we let THAT happen.
Other option I've seen batted around is a global depression, the world writes off debts and starts all over from scratch and we (with the current USA mentality) can't allow that because there's no f'ing way we'd be able to come out on top again without some sort of manufacturing base to make REAL goods and services.

We'd better start eating some of this before we end up with nothing to eat at all....

[Roland99]

99. Time to kick in the Bush Doctrine on some Third Worlders.

[Hugin]

88. As we sit through the eye of the perfect storm today... Here's some Market Maker Mood Music:

"Another One Bites The Dust" -- Queen

"Steve walks warily down the street,
With the brim pulled way down low
Aint no sound but the sound of his feet,
Machine guns ready to go
Are you ready, are you ready for this
Are you hanging on the edge of your seat
Out of the doorway the bullets rip
To the sound of the beat

Another one bites the dust
Another one bites the dust
And another one gone, and another one gone
Another one bites the dust
Hey, Im gonna get you too
Another one bites the dust

How do you think Im going to get along,
Without you, when youre gone
You took me for everything that I had,
And kicked me out on my own

Are you happy, are you satisfied
How long can you stand the heat
Out of the doorway the bullets rip
To the sound of the beat

Chorus

Another one bites the dust
Another one bites the dust
Another one bites the dust
Another one bites the dust
There are plenty of ways you can hurt a man
And bring him to the ground
You can beat him
You can cheat him
You can treat him bad and leave him
When hes down
But Im ready, yes Im ready for you
Im standing on my own two feet
Out of the doorway the bullets rip
Repeating the sound of the beat"

http://www.lyricsfreak.com/q/queen/another+one+bites+the+dust_20112678.html



For the children (and those who insist on acting like children)

"High Hopes" as performed by Frank Sinatra

"Have fun now, boys and girls. Relax."

One, two

NOTE: words inside (parentheses) are sung by children only.
Words in {brackets} are sung by Frank AND children

(Next time you're found with your chin on the ground)
(There's a lot to be learned so look around)

Just what makes that little ole ant
Think he'll move that rubber tree plant?
Anyone knows an ant can't
Move a rubber tree plant

{But he's got hi-i-igh hopes, he's got hi-i-igh hopes}
{He's got high apple pi-i-ie-in-the-sk-y-y hopes}
So, any time you're gettin' low, 'stead of lettin' go, just remember that ant
Oops, there goes another rubber tree plant
(Oops, there goes another rubber tree plant)
{Oops, there goes another rubber tree plant}

(When troubles call and your back's to the wall)
(There a lot to be learned that wall could fall)

Once there was a silly old ram
Thought he'd punch a hole in a dam
No one could make that ram scram
He kept buttin' that dam

{'cause he had hi-i-igh hopes, he had hi-i-igh hopes}
{He had high apple pi-i-ie-in-the-sk-y-y hopes}
So, any time your feelin' bad, 'stead of feelin' sad, just remember that ram
Oops, there goes a billion-kilowatt dam
(Oops, there goes a billion-kilowatt dam)
{Oops, there goes a billion-kilowatt dam }




(A problem's just a toy balloon, they'll be bursted soon)
(They're just bound to go pop)

Oops, there goes another problem ker-plop
(Oops, there goes another problem ker-plop)
{Oops, there goes another problem ker-plop}

(Ker-plop!)"


http://www.thepeaches.com/music/frank/HighHopes.htm

[Ghost Dog]

61. ‘US economy in desperate shape’ : Stiglitz

Joseph Stiglitz was awarded the Nobel Prize for Economics in 2001. He spoke from New York with Global Viewpoint editor Nathan Gardels on Tuesday, Sept. 16, about the Wall Street meltdown. — Editor

Nathan Gardels: Barack Obama has said the Wall Street meltdown is the greatest financial crisis since the Great Depression. John McCain says the economy is threatened, but fundamentally strong. Which is it?

Joseph Stiglitz: Obama is much closer to the mark. Yes, America has talented people, great universities and a good hi-tech sector. But the financial markets have played a very important role, accounting for 30 percent of corporate profits in the last few years.

Those who run the financial markets have garnered those profits on the argument they were helping manage risk and efficiently allocating capital, which is why, they said, they “deserved” those high returns.

That’s been shown to be not true. They’ve managed it all badly. Now it has come back to bite them and now the rest of the economy will pay as the wheels of commerce slow because of the credit crunch. No modern economy can function well without a vibrant financial sector.

So, Obama’s diagnosis that our financial sector is in desperate shape is correct. And if it is in desperate shape, that means our economy is in desperate shape.

Even if we weren’t looking at the financial turmoil, but at the level of household, national and federal debt there is a major problem. We are drowning. If we look at inequality, which is the greatest since the Great Depression, there is a major problem.
If we look at stagnating wages, there is a major problem.

Most of the economic growth we’ve had in the past five years was based on the housing bubble, which has now burst. And the fruits of that growth have not been shared widely.

In short, the fundamentals are not strong.

Gardels: What ought to be the policy response to the Wall Street meltdown?

Stiglitz: Clearly, we need not only re-regulation, but a redesign of the regulatory system. During his reign as head of the Federal Reserve in which this mortgage and financial bubble grew, Alan Greenspan had plenty of instruments to use to curb it, but failed. He was chosen by Ronald Reagan, after all, because of his anti-regulation attitudes.

Paul Volcker, the previous Fed Chairman known for keeping inflation under control, was fired because the Reagan administration didn’t believe he was an adequate de-regulator.

Our country has thus suffered from the consequences of choosing as regulator-in-chief of the economy someone who didn’t believe in regulation.

So, first, to correct the problem we need political leaders and policymakers who believe in regulation. Beyond that, we need to put in place a new system that can cope with the expansion of finance and financial instruments beyond traditional banks.

/continues... http://www.arabtimesonline.com/client/pagesdetails.asp?nid=22397&ccid=11

[DemReadingDU]

67. That is a great article!

I was just going to post it from The Huffington Post

http://www.huffingtonpost.com/nathan-gardels/stiglitz-the-fall-of-wall_b_126911.html

[Ghost Dog]

78. Please see Obama's Economy Platform at #36

(follow link: superb address: transcript, full-length video).

[Pale Blue Dot]

69. PIEHOLE ALERT 10:15

According to the front page of MSNBC, Bush will speak about the financial crisis at that time.

[Demeter]

72. What Fresh Hell Is This? Why Doesn't He STAY In His Spider Hole?

The handlers must be desperate.

[radfringe]

75. ummmm... the fundamentalists of our ENRONomy is strong

errrr... we're doin' fine, wall street got drunk agin... ahhhh...it's the democrats fault.... Ahm callin' on congress to send me a oil bill that I can sign... get 'er done.... :hic:

[Wednesdays]

76. Because his speech will be in the middle of the sucker rally

Gotta do everything they can to make the chimp look good. :eyes:

[Hugin]

89. Can you believe it?

There's still a few um... Trolls? around who think 401(k)s and dumping Social Security in the Stock Market
are a good idea. :eyes:

Some people just don't frigging GET IT! It's over!


I'll be back in a second.

[SpiralHawk]

74. "Nothing to worry about. I am The Decider. Smirk." - Commander AWOL

"You noisy American proles can count on us republicon homelanders to do a heckuva job. As ususal. Smirk."

- Commander AWOL

[Dr.Phool]

90. Get ready for a big drop!

His charm has a way with the markets.

[UpInArms]

103. PIEHOLE OPEN: Bush: Fed's actions 'necessary and important'

02. Bush: Fed's actions 'necessary and important'
10:17 AM ET, Sep 18, 2008

03. Bush: We will act to strengthen markets, improve confidence
10:17 AM ET, Sep 18, 2008

04. Bush cancels travel plans to consult with economic team
10:16 AM ET, Sep 18, 2008

[RUMMYisFROSTED]

77. Magic 8 Ball says:

[InkAddict]

81. Try again later. n/t

[RUMMYisFROSTED]

181. When I predict ponies, I mean ponies!

Do not underestimate the Magic 8 Ball.

[Demeter]

183. Oooh! Pretty! Shiny!! Pink!!!

I think I'm gonna barf. I hate pink.

[fascisthunter]

79. anyone predicting a bounce or will today be "flat"?

nevermind... I see it's up 173....

[spinbaby]

98. I'll think we'll have a bounce

A very bad day is almost always followed by a bit of an uptick.

[fascisthunter]

100. That's What I Have Seen in the past

and it appears to be somewhat consistent with today's reaction to yesterday.

[UpInArms]

80. Kraft Foods to replace AIG on Dow Jones Industrial Average

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BA43552BF%2DEC58%2D424E%2D895F%2D43583DF2105D%7D&siteid=mktw

NEW YORK (MarketWatch) -- Kraft Foods Inc. (KFT: 33.29, +0.64, +2.0%) will replace troubled insurance giant American International Group Inc. (AIG: 2.33, +0.28, +13.7%) on the Dow Jones Industrial Average ($INDU: 10,725.44, +115.78, +1.1%) , effective Monday, Dow Jones & Co. announced Thursday. Dow refrained from adding another stock in the financial sector because of "the extremely unsettled conditions," the company said in a release. The 112-year-old blue-chip stock index was previously changed on Feb. 19, 2008, when two of its 30 components were replaced.

[Demeter]

184. Can You Say "Cheese"?

Pretty soon, they're gonna run out of substitutes!

[UpInArms]

85. The worst is yet to come - Write-offs could top $1 trillion

http://www.marketwatch.com/news/story/worst-yet-come-investment-strategist/story.aspx?guid=%7B55B21789%2D3A26%2D495A%2DB0D3%2D5AF3F6ABDA18%7D&dist=TNMostRead

SAN FRANCISCO (MarketWatch) -- An influential investment strategist has a dire forecast for U.S. stocks, credit markets and the continued independence of some of the nation's top financial institutions.

Jeffrey Gundlach, chief investment officer at Los Angeles-based mutual-fund company TCW Group Inc., told clients on a conference call late Wednesday that the crisis in credit and housing may not abate for several years and is actually getting worse.

<snip>

"If it's like the Depression experience -- and it sure is shaping up that way -- it could take several years. Maybe we won't see a bottom in home prices until 2014," he said.

Write-offs could top $1 trillion

As a forecaster, Gundlach didn't just climb aboard the gloom-and-doom wagon. He was early to spot the cracks that subprime loans were making in the financial system, and among the first to warn that an era of easy money would come to a bad end.

"The subprime market is a total unmitigated disaster and it's going to get worse," Gundlach told money managers and financial advisers at an investment conference in June 2007.

...more...

[UpInArms]

93. 3-mo TED spread balloons to almost 500 basis points

http://www.reuters.com/article/bondsNews/idUSLI37362520080918

LONDON, Sept 18 (Reuters) - The difference between borrowing three-month dollars on the interbank market and the U.S. Treasury's three-month borrowing costs widened dramatically on Thursday to nearly five full percentage points. That was despite coordinated action from the world's major central banks to provide up to $180 billion of dollar liquidity to frozen international money markets. The action helped to briefly bring down overnight term interbank dollar lending rates toward the Federal Reserve's 2 percent target rate but the cost of borrwing three-month funds continued to rise to almost 5 percent <USD3MD=>.

With three-month T-bill yields collapsing to almost zero this week amid investors' flight to safety amid the deepening financial crisis, the closely-watched 'TED' spread widened to around 490 basis points on Thursday <USD3MD=> <US3MT=RR>, Reuters charts showed.

That's more than double the highest points at any time during the 13-month financial crisis and the highest in several years.

[Dr.Phool]

95. You kids have fun today.

I'm off to take care of some bidness, and then a 3 martooni lunch with a 3 martooni dessert, and followed by cocktail hour, and a martooni dinner.

And when my wife gets home, I'll get my ass kicked royally.

Bye.

[Hugin]

104. See ya Dr.Phool...

Since my plans to emulate J. P. Morgan's escape from an untimely end on the Titanic... (Being found holed-up in the Swiss Alps with a couple of 'Student Nurses'
after a brief crocodile tear filled memorial service was held in my honor by those who were eager for me to have gone down with the ship.) were thwarted by Demeter.

I'll be here.

:hi:

[Demeter]

185. HAHAHAHAHAAHAHAHAHA!

:rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl:

Who needs alcohol when Prag is around!

[antigop]

101. Former SEC chief Donaldson: Short-term earnings focus led to Wall Street woes

Short-term earnings focus led to Wall Street woes, former SEC chief Donaldson says
http://financialweek.com/apps/pbcs.dll/article?AID=/20080917/REG/809179981/1036

It’s a no-brainer that many of the current market troubles affecting Wall Street are due to excessive risk from securitized mortgages. But there’s another culprit afoot, according to former Securities and Exchange Commission chairman William Donaldson: the focus on short-term earnings.

Speaking today at Bloomberg News headquarters in New York City, Mr. Donaldson said “the excessive focus by too many corporations on achieving short-term results, fanned by the practice of ceding to demands for regular guidance and forecasting, such as quarterly results, certainly is one of the root causes for some of the problems we face today.”

He joined members of the CFA Institute, Business Roundtable, Aspen Institute and other groups calling for an end to quarterly earnings guidance, which he said is a “ridiculous game” that “threatens to undermine our economic future.” Aspen last summer put out a series of principles that called for an end to short-term guidance.

In particular, Mr. Donaldson said companies should focus on long-term risk and strategies in the management discussion and analysis section of SEC filings, and that a “significant portion” of executive compensation should be tied to those strategies.

[Roland99]

106. Today's "No DUH!" news item

[54anickel]

110. Had the same reaction! Talk about your Captain Obvious.

[antigop]

112. but he's admitting it! n/t

[Hugin]

113. To have it spoken is a good thing.

It shows the thought is circulating. :my2cents:

[antigop]

116. I agree, especially since he was SEC chief. n/t

[54anickel]

119. Day late, billions short.....

This is from Tuesday, so already short and out of date

http://www.reuters.com/article/bondsNews/idUSN16126320080917

FACTBOX: Government bailout tally tops $900 billion

(Reuters) - The U.S. Federal Reserve stepped in to rescue insurance giant American International Group from bankruptcy with an $85 billion loan on Tuesday, the latest in a series of bailouts and loans for the financial and housing sectors.

The action brings the total tab for government rescues and special loan facilities this year to more than $900 billion.

Following are details of actions and amounts.

more...

[Hugin]

120. This is true.

But, Donaldson is not currently at the switches. I'm taking his statement as an indication that our message is getting
through. This crisis is not going to resolve itself overnight. We won't wake up tomorrow with the streets paved in Gold.

It took the Shruggers years to tear down the Safety Net. Much de-programming, education and infrastructure restoration
will be required.

[antigop]

140. Donaldson, Oct, 2007: "Markets don't regulate themselves. Clearly."

http://www.pbs.org/moyers/journal/10122007/transcript1.html

I would hope that I would be called independent in thought, and not adopting a conservative or liberal — clearly what's needed is an independence of thought, if you will. And an approach to regulation. Markets don't regulate themselves. Clearly. Anymore than you can have an intersection and no stop signs and red lightS.

[Karenina]

115. And in other news... WATER IS WET!!!

:rofl:

[antigop]

117. For a former SEC chief to publicly make this statement is a good thing, imo. n/t

[Karenina]

177. I see your point.

But gosh, by golly, it's been SO IN-YER-FACE obvious for so-o-o-o-o lo-o-o-o-ong...

[antigop]

118. Donaldson's BIO

http://www.sec.gov/about/commissioner/donaldson.htm

Mr. Donaldson arrived at the Commission with more than 45 years of experience working at the highest levels of business, government and academia. He served as Chairman and CEO of the investment banking firm Donaldson, Lufkin & Jenrette, which he co-founded; Chairman and CEO of the New York Stock Exchange; Chairman, President and CEO of Aetna; and Chairman and CEO of Donaldson Enterprises, Inc.

[Demeter]

186. It's Called "CuttingCorners" and Cutting Standards" and You Don't Need a Quarterly Schedule to Do It

Just an elastic conscience and no oversight.

[antigop]

107. Today's word: GREED

America's Disease is Greed
by Andrew Greeley

http://www.commondreams.org/views04/0820-09.htm

The most serious spiritual problem in the country today is reckless and untrammeled greed. Greed caused the disgraceful corporate scandals that fill our newspapers. Greed is responsible for crooked cops and crooked politicians. Greed causes the constant efforts to destroy unions that protect basic worker rights.

Greed has produced rash tax cuts that have given money to the rich and in effect taken it away from the poor. Greed has led to the immigration policy in which hundreds of poor men and women die every year as they struggle across the desert for the jobs that el norte promises them. Greed accounts for the efforts to take profitability out of the pensions and health insurance of working men and women. Greed is responsible for the fact that so many Americans have no health insurance and the fact that the recent reform of Medicare was a fraud. Greed causes newspapers to overestimate their circulation.

Greed is responsible for the obscene salaries of CEOs. In the '90s the ratio of CEO compensation to average workers' compensation was 250 to 1, meaning that the boss earned on his first day of work during a year as much as the worker did in a whole year. In European countries the ratio is closer to 100 to 1. Recent estimates put the current ratio at 500 to 1 -- the boss makes as much before lunch as the worker does all year. Greed is the cause of the high wages paid to the bosses even if the company is failing.
...
No one said during the bizarre deification of President Reagan that he taught us that greed is good and that we should feel good about our greedy country.

[Hugin]

111. a********* Pool Standings *********** (Pool is currently locked)

_________________________________________________________________________________________________________________________
Guess the date the DJIA rolls back to the level it was when the chimp took office-10,578.24. You can revise your dates until the DJIA hits(IMPORTANT CHANGE) 10700 (got to have a cut off). Anyone can join, just give a date and your reasoning for that date. Note the change on the cut off. That should make for a good horse race. I will check the post date/time for last minute posters but those that guessed the date way in advance get extra points. The earlier posters are at the top in the cases of multiple guesses on the same day.

Ghost Dog ....9/18 (You may just get it GD!)
uppityperson... 9/18 (Note: Because it's a special day.)

Ozy.....9/19 (Note: Ozy picked this date a couple of months ago.)
AnneD..... 9/19 (Like the quadruple witching thang.)
readmoreoften... 9/19
Karenina.... 9/19

Demeter.....9/22
Buttercup McToots ... 9/22 (Note: Said Please.)
ozone_man.....9/23
dweller.... 9/25
JuneBourder.....9/29
radfringe.... 10/09/08 (Countdown!)
Birthmark....10/10
Mojorabbit.... 10/11
Tansy_Gold.....10/13
DemReadingDU.....10/16
Roland99.....10/17
AnneD....10/24
Neshanic.....10/24
dweller....10/25 (Note: Standby Date)
UpInArms.....10/30
MsLeopard.....10/31
Wordpix.....11/3
Passingfair.....11/4
Ship wrack.....11/5
Wednesdays.....1/16/2009

Remember-you can change the dates as we learn more. If your date isn't on the list, e-mail me and I'll add it the next time I post. I erased expired dates so you can guess again. I post about one a week-more often the closer we get to the number. The winner get the praise and admiration of those on the Stock Watch Thread. We have also kicked in for a years worth of bragging rights and Karl Rove as you own pool boy if we can find Speedos to fit. There is still time to place your bets.....And please-no Reggie bars in the pool.

IMPORTANT ADDENDUM: I believe, as an investor, one day does not a trend make. So as activity coordinator of the pool, additional guesses are allowed should it dip down but pop up above the cut off. Call it the Indian Summer Clause. I personally think that 11000 is their PIN, but the fact that it cannot be pumped up any further anymore points to weakness in the system-for my $0.02.
__________________________________________________________________________________________________________________________

[Hugin]

114. b*********** Pool Unlocked ********** (Based on news AIG replaced in Dow)

Naturally, that will raise the average, but, what are they going to do when they -all- tank again. One only has
to consider Kraft is a very consumption sensitive stock and consumption is down across the board.

_________________________________________________________________________________________________________________________
Guess the date the DJIA rolls back to the level it was when the chimp took office-10,578.24. You can revise your dates until the DJIA hits(IMPORTANT CHANGE) 10700 (got to have a cut off). Anyone can join, just give a date and your reasoning for that date. Note the change on the cut off. That should make for a good horse race. I will check the post date/time for last minute posters but those that guessed the date way in advance get extra points. The earlier posters are at the top in the cases of multiple guesses on the same day.

Ghost Dog ....9/18 (You may just get it GD!)
uppityperson... 9/18 (Note: Because it's a special day.)

Ozy.....9/19 (Note: Ozy picked this date a couple of months ago.)
AnneD..... 9/19 (Like the quadruple witching thang.)
readmoreoften... 9/19
Karenina.... 9/19

Demeter.....9/22
Buttercup McToots ... 9/22 (Note: Said Please.)
ozone_man.....9/23
dweller.... 9/25
JuneBourder.....9/29
radfringe.... 10/09/08 (Countdown!)
Birthmark....10/10
Mojorabbit.... 10/11
Tansy_Gold.....10/13
DemReadingDU.....10/16
Roland99.....10/17
AnneD....10/24
Neshanic.....10/24
dweller....10/25 (Note: Standby Date)
UpInArms.....10/30
MsLeopard.....10/31
Wordpix.....11/3
Passingfair.....11/4
Ship wrack.....11/5
Wednesdays.....1/16/2009

Remember-you can change the dates as we learn more. If your date isn't on the list, e-mail me and I'll add it the next time I post. I erased expired dates so you can guess again. I post about one a week-more often the closer we get to the number. The winner get the praise and admiration of those on the Stock Watch Thread. We have also kicked in for a years worth of bragging rights and Karl Rove as you own pool boy if we can find Speedos to fit. There is still time to place your bets.....And please-no Reggie bars in the pool.

IMPORTANT ADDENDUM: I believe, as an investor, one day does not a trend make. So as activity coordinator of the pool, additional guesses are allowed should it dip down but pop up above the cut off. Call it the Indian Summer Clause. I personally think that 11000 is their PIN, but the fact that it cannot be pumped up any further anymore points to weakness in the system-for my $0.02.
__________________________________________________________________________________________________________________________

[Pale Blue Dot]

121. If you're going to open it up again, put me on for today.

It's not looking like this "rally" is going to hold.

[Hugin]

123. Okay, I was just about to lock it again... Dayum, $180 Billion doesn't go very far these days.

I can remember when it'd buy 3 months of WAR! :eyes:

[Hugin]

127. c************** Pool is Locked *************

Dow 10,648.99 +39.33 (0.37%)
Nasdaq 2,098.21 -0.64 (-0.03%)
S&P 500 1,159.19 +2.80 (0.24%)

10y bond 3.40% -0.06 (-1.73%)

In true Indiana Jones like fashion... Finnfan reached under a closing granite trap door to grab Today's date. :)

_________________________________________________________________________________________________________________________
Guess the date the DJIA rolls back to the level it was when the chimp took office-10,578.24. You can revise your dates until the DJIA hits(IMPORTANT CHANGE) 10700 (got to have a cut off). Anyone can join, just give a date and your reasoning for that date. Note the change on the cut off. That should make for a good horse race. I will check the post date/time for last minute posters but those that guessed the date way in advance get extra points. The earlier posters are at the top in the cases of multiple guesses on the same day.

Ghost Dog ....9/18 (You may just get it GD!)
uppityperson... 9/18 (Note: Because it's a special day.)
Finnfan.... 9/18 (Note: "What are you going to do to get us out of this mess, Indy?" "I'm workin' on it! I'm workin' on it!")


(Roland99 pointed out that 9/19 is also: Talk Like a Pirate Day! Avast!)
Ozy.....9/19 (Note: Ozy picked this date a couple of months ago.)
AnneD..... 9/19 (Like the quadruple witching thang.)
readmoreoften... 9/19
Karenina.... 9/19

Demeter.....9/22
Buttercup McToots ... 9/22 (Note: Said Please.)
ozone_man.....9/23
dweller.... 9/25
JuneBourder.....9/29
radfringe.... 10/09/08 (Countdown!)
Birthmark....10/10
Mojorabbit.... 10/11
Tansy_Gold.....10/13
DemReadingDU.....10/16
Roland99.....10/17
AnneD....10/24
Neshanic.....10/24
dweller....10/25 (Note: Standby Date)
UpInArms.....10/30
MsLeopard.....10/31
Wordpix.....11/3
Passingfair.....11/4
Ship wrack.....11/5
Wednesdays.....1/16/2009

Remember-you can change the dates as we learn more. If your date isn't on the list, e-mail me and I'll add it the next time I post. I erased expired dates so you can guess again. I post about one a week-more often the closer we get to the number. The winner get the praise and admiration of those on the Stock Watch Thread. We have also kicked in for a years worth of bragging rights and Karl Rove as you own pool boy if we can find Speedos to fit. There is still time to place your bets.....And please-no Reggie bars in the pool.

IMPORTANT ADDENDUM: I believe, as an investor, one day does not a trend make. So as activity coordinator of the pool, additional guesses are allowed should it dip down but pop up above the cut off. Call it the Indian Summer Clause. I personally think that 11000 is their PIN, but the fact that it cannot be pumped up any further anymore points to weakness in the system-for my $0.02.
__________________________________________________________________________________________________________________________

[radfringe]

130. question

does it have to HIT the bush number or market has to close at or below bush number?

[bain_sidhe]

132. GMTA! ...

but some type faster!

[Hugin]

137. At the Great Reset Rules Committee meeting back in.. uh, March (I think)

It was decided by the High Command that the Dow would have to close On or Below the value.

:patriot:

[AnneD]

190. At or below the Bush number

at the close of the bell. The pool is open for after hours skinny dipping. See post below.

[bain_sidhe]

131. It already hit it, according to NYT

Front page just a minute ago had DJIA as 10,575. But it's gone up a bit. Is the pool for when it just hits it, or when it closes at or below the 10,578 number?

Edited to add that NYT has 10,568.95 as the low of the day... so far...

[Hugin]

135. It must close below the Great Reset number...

That said, it's looking like it'll do it.

For some reason my numbers here are delayed somewhat from what I'm hearing elsewhere. Maybe it's the volumes?

Thanks for the tipoff bain_sidhe. :)

[bain_sidhe]

139. here's the NYT link

if you're registered there:

http://markets.on.nytimes.com/research/markets/usmarkets/snapshot.asp?symbol=US%26DJI

It appears to be an "evergreen" link (always current), so I'm bookmarking it.

[uppityperson]

145. Thanks, was wondering since it hit it today already.

And it is my special day and all.

[Hugin]

153. Hang around.

Looks to be likely!

[uppityperson]

158. Thanks, like the commentary on DU, watching #s elsewhere too 10,494.21

http://money.cnn.com/data/markets/dow/

[Roland99]

125. Tomorrow (9/19) is also National Talk Like a Pirate Day!!

ARrrrrrrrrrrrrrr

[Hugin]

126. What a coincidence, eh?

I bet real Pirates didn't sink their own ships!

Avast! Swab the poopdeck and pass the grog! :rum:

[Demeter]

188. Not Without a Very Good Reason, Anyway

Douglass Fairbanks, Errol Flynn, where are you?

[Demeter]

187. The Stupid Announcer on NPR Said It Was Talk Like a Parrot Day

what a bimbo.

[Lydia Leftcoast]

122. I'm watching the dollar fall against the yen

It's moving pretty fast. An hour ago it was fluctuating in the 105 range, but now it's fluctuating in the 104 range.

[4dsc]

136. dollar down means oil up??

We've watched oil drop recently and all the talking heads claimed it was do to the stronger dollar(not so much falling demand). So we have a free falling dollar again will that mean higher oil prices as demand continues to fall worldwide??

[Lydia Leftcoast]

178. It depends on how the dollar is in relation to other currencies--I think

I'm interested in the yen because about 3/4 of my customers are in Japan.

[thewiseguy]

124. Morgan Stanley is really falling right now

Down more than 20%

[Tandalayo_Scheisskopf]

128. The Kasino on a Pogo Stick.

More ups and downs than those hookers who worked the RNC.


PETROLEUM ($/bbl)
PRICE* CHANGE % CHANGE TIME
Nymex Crude Future 97.60 .44 .45 10:53
Dated Brent Spot 92.77 -.39 -.41 11:23
WTI Cushing Spot 100.10 2.94 3.03 09:07


PETROLEUM (¢/gal)
PRICE* CHANGE % CHANGE TIME
Nymex Heating Oil Future 279.17 -3.30 -1.17 10:53
Nymex RBOB Gasoline Future 240.26 -6.04 -2.45 10:53


NATURAL GAS ($/MMBtu)
PRICE* CHANGE % CHANGE TIME
Nymex Henry Hub Future 7.54 -.37 -4.64 10:53
Henry Hub Spot 7.82 .07 .90 09/17
New York City Gate Spot 8.09 .03 .37 09/17


ELECTRICITY ($/megawatt hour)
PRICE* CHANGE % CHANGE TIME
Mid-Columbia, firm on-peak, spot 55.88 -2.46 -4.22 09/17
Palo Verde, firm on-peak, spot 56.18 .27 .48 09/17
Bloomberg, firm on-peak, day ahead spot/West Coast 65.22 -1.39 -2.09 09/17
------------------------------
RBOB is headed down again. The gamblers are trying to find some solace in Crude, but that is headed back down as well.

Something tells me that slowly, ever slowly, reality is setting in and these maniacs are figuring out that there ain't no "safe havens".

[Tandalayo_Scheisskopf]

133. Hoy hoy!!!

PETROLEUM ($/bbl)
PRICE* CHANGE % CHANGE TIME
Nymex Crude Future 96.57 -.59 -.61 11:38
Dated Brent Spot 92.24 -.92 -.98 12:08
WTI Cushing Spot 96.18 -.98 -1.01 12:04


PETROLEUM (¢/gal)
PRICE* CHANGE % CHANGE TIME
Nymex Heating Oil Future 277.00 -5.47 -1.94 11:38
Nymex RBOB Gasoline Future 237.11 -9.19 -3.73 11:38


NATURAL GAS ($/MMBtu)
PRICE* CHANGE % CHANGE TIME
Nymex Henry Hub Future 7.56 -.36 -4.49 11:39
Henry Hub Spot 7.82 .07 .90 09/17
New York City Gate Spot 8.09 .03 .37 09/17


ELECTRICITY ($/megawatt hour)
PRICE* CHANGE % CHANGE TIME
Mid-Columbia, firm on-peak, spot 55.88 -2.46 -4.22 09/17
Palo Verde, firm on-peak, spot 56.18 .27 .48 09/17
Bloomberg, firm on-peak, day ahead spot/West Coast 65.22 -1.39 -2.09 09/17


Crude Oil Falls After Gas Supplies Rise More Than Expected

By Margot Habiby

Sept. 18 (Bloomberg) -- Crude oil fell more than $1 a barrel, erasing earlier gains, after the U.S. Energy Department reported that natural gas supplies rose more than expected last week.

Oil for October delivery dropped $1.23, or 1.3 percent, to $95.93 a barrel at 11:32 a.m. on the New York Mercantile Exchange. Futures are little changed this year and have lost 35 percent of their value since reaching a record $147.27 a barrel on July 11.

Supplies of natural gas rose 67 billion cubic feet in the week ended Sept. 12, the department said. Analysts expected an increase of 63 billion, based on the median of 23 estimates in a Bloomberg survey.

Natural gas for October delivery dropped 28.9 cents, or 3.7 percent, to $7.621 per million British thermal units at 11:25 a.m. on the Nymex. The futures were trading at $7.938 per million Btu before the report was released at 10:35 a.m. in Washington.

Oil tumbled more than $10 to a seven-month low of $90.51 a barrel in the first two days of the week as Lehman Brothers Holdings Inc. filed for bankruptcy protection, and Merrill Lynch & Co. was bought by Bank of America.

[DemReadingDU]

134. NCUA Terminates Toledo Metro Federal Credit Union Letter of Understanding

9/18/08 NCUA Terminates Toledo Metro Federal Credit Union Letter of Understanding

September 18, 2008, Alexandria, Va. -- The National Credit Union Administration Board has terminated a published Letter of Understanding (LUA) signed February 16, 2006, by Toledo Metro Federal Credit Union, Toledo, Ohio, recognizing the credit union has resolved the issues discussed in the LUA and improved its underwriting and compliance with NCUA rules and regulations.

Toledo Metro Federal Credit Union is open, operating and serving its members. Member funds are federally insured up to at least $100,000 by the National Credit Union Share Insurance Fund, a federal fund managed by NCUA and backed by the full faith and credit of the U.S. government.

http://www.ncua.gov/news/press_releases/2006/NR06-0614.htm

The National Credit Union Administration is the independent federal agency that charters and supervises federal credit unions. NCUA, with the backing of the full faith and credit of the U.S. government, operates and manages the National Credit Union Share Insurance Fund, insuring the savings of over 88 million account holders in all federal credit unions and the majority of state-chartered credit unions.

http://www.ncua.gov/news/press_releases/2008/MR08-0918.htm

[UpInArms]

138. More Money Market Woes: Putnam closes Putnam Prime Money Market Fund

03. Putnam Prime Money Market Fund net asset value $1 a share
12:19 PM ET, Sep 18, 2008

04. Putnam's decision due to marketwide liquidity issues
12:18 PM ET, Sep 18, 2008

05. Putnam closes Putnam Prime Money Market Fund
12:17 PM ET, Sep 18, 2008

[Dr.Phool]

141. I just popped back in before the vodka kicks in. Dow 10,573.

Yer doin' a heck of a job Chimpie!:applause: :rofl: :rofl: :rofl: :rofl: :rofl: :applause: :rofl: :rofl: :rofl: :rofl: :rofl: :applause: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo:

[DemReadingDU]

151. I leave the computer for 30 minutes

and the market dives into the pool!

[Roland99]

142. 12:40pm - The bloom is off the rose

Dow 10,545.59 -64.07
Nasdaq 2,083.50 -15.35
S&P 500 1,144.17 -12.22
10-year 3.41% 0.00
Oil $96.40 -$0.76
Gold $880.00 $29.50

[nolabels]

150. Well big effing deal, the poor little stock marker lost 10% in a couple days

Many people who got in the ponzi scheme of home mortgage too late lost as much as 50% or more. Mostly i haven't heard of the feds bailing those people with buyouts :shrug:

[antigop]

143. Irony: Reserve Management's chief founded money-market fund concept

http://online.wsj.com/article/SB122169845959750475.html?mod=googlenews_wsj

The Lehman debt, whose face value was $785 million, had to be written down to zero for the flagship fund of New York's Reserve Management Corp. That pushed the fund's per-share price down to $0.97, a bracing signal to investors and a jolt to money-market investors world-wide.

The cruel irony is that the founder of the money-market fund concept more than three decades ago, Bruce Bent, is Reserve Management's chief -- and Mr. Bent, 71 years old, has long trumpeted the funds as avatars of sober-minded investing.

In a message on the firm's Web site that remains even now, he notes many have "lost sight of the purpose of a money fund" in their "foolhardy quest for a few extra basis points" while the Reserve believes cash funds are "definitely not money to take risks with." On Friday, Mr. Bent, appearing on CNBC discussing the financial crisis sweeping banks, said money funds do a "disservice to the investing public" when they fail to sufficiently research their holdings.

[Cassius23]

144. Market Watch- 12:44PM Look out below!

Dow -42.34 -0.40% 10,567.32
NASDAQ -16.79 -0.80% 2,082.06
S&P -10.72 -0.93% 1,145.67

Wow. Just..wow.

[radfringe]

146. heckava job, bushie....

way to make the pie higher...

[Cassius23]

152. Great job indeed.

Another two or three bad days and we'll be below 10,000. I'm pretty sure that would be not good at all.

[Roland99]

148. 12:50pm - Triple digit loss now!

Dow 10,506.34 -103.32
Nasdaq 2,071.26 -27.59
S&P 500 1,136.78 -19.61
10-year 3.37% -0.04
Oil $96.40 -$0.76
Gold $877.60 $27.10

[ozymandius]

154. Hey folks! I'm back.

I missed so much good stuff. I may lose my bet in the pool - but it's worth the trip to see FAILURE written over the last eight years of President Piehole's tenure.

Ive been wondering. Would it be impolite to refer to Gov. Palin as Bullwinkle?

[Hugin]

155. Only by a day, Ozy!

I guess I'm going to have to go back and do a timeline on the pool. But, I seem to remember we started it almost a year
ago and you entered your date last spring.

[Dr.Phool]

160. I thought Bullwinkle was male.

I could be wrong. Maybe Bulshitwinkle.

[Hugin]

163. Moowinkle?

:shrug:

[ozymandius]

167. Bullwinkle occasionally wore a dress.

But yes - Bullwinkle is male. It seemed to follow a logical extension from the moose reference+ignorant+always looking out-of-place.

Probably a bit of a stretch. Madame Bullwinkle.

[Dr.Phool]

175. I used to work with a guy who looked like Bullwinkle.

And he was just as big. 6'5", 280lb.

Now she's a very large woman who looks like Bullwinkle.

[ozymandius]

179. OMG!

How much did the antlers weigh?

[Robbien]

168. Watched the ticker for about ten minutes and it went from negative hundred and something

to positive around fifty. In ten minutes!

This is nuts.

[ozymandius]

169. Bernanke wants me to win my bet - I'll bet.

If they're really really good at the PPT, they'll make it land at 10,579.

[SmokingJacket]

171. I saw that too. WTF? nt

[bain_sidhe]

147. New pool?

What was the lowest close during Bush's presidency? Think we can hit that?

(I have no idea how to find out what it was, but I think it got into the 7000's at one point. Off to see if my google-fu is up to the task.)

[Roland99]

149. I'm guessing we'll hit the upper 8000s as a low....think we'll need a new thread soon, too!!

[DemReadingDU]

156. Wasn't the low in Oct 2002?

7300?
something like that

[Hugin]

159. October 4th, 2002. (7528.40)

Ah, I remember it like it was yesterday.

[DemReadingDU]

162. What's this? 10/9/02: 7286.27

October 9, 2002

7,286.27

historical prices
http://finance.yahoo.com/q/hp?s=%5EDJI&a=05&b=1&c=2002&d=11&e=1&f=2002&g=d

[Hugin]

170. Hey! The Googler skips from 10/4 - 10/11.

So, you're probably correct.

http://finance.google.com/finance?cid=983582

[bain_sidhe]

166. Yep, I just found that.

Although this page states that it was 7,286.27 instead of .40. Dunno why.

http://money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F9%2F2002&mode=add&symb=INDU

[Hugin]

174. I had to switch over to the historical listings at Google Finance.

9-Oct-02 7,499.96 7,500.03 7,215.39 7,286.27 18,850,300 <--- It's the 9th.

From:

http://finance.google.com/finance/historical?cid=983582&startdate=Oct+1%2C+2002&enddate=Oct+15%2C+2002

[spinbaby]

161. What just happened?

Up over 100 points in a matter of minutes.

[uppityperson]

164. boing!

10,624.64 +14.98

[Dr.Phool]

165. Gold at 905.00 now.

[ozymandius]

172. NEW THREAD

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3497479

[Robbien]

McCain calls for Bush to fire SEC's Chris Cox

Sen. John McCain on Thursday called for President Bush to fire the chairman of the Securities and Exchange Commission, while he and his campaign charged that Sen. Barack Obama is using the current economic crisis as a political opportunity.

McCain, distancing himself from the Bush administration, said heads should roll, starting with SEC Chairman Christopher Cox, appointed by the president in 2005.

"The primary regulator of Wall Street, the Securities and Exchange Commission (SEC) kept in place trading rules that let speculators and hedge funds turn our markets into a casino," he said. "The chairman of the SEC serves at the appointment of the president and has betrayed the public's trust. If I were president today, I would fire him."

McCain said the SEC allowed "naked short selling," which means that traders were selling stock without ever owning it. He also said federal regulators last year eliminated the "uptick rule" that regulates short selling and has protected investors for 70 years.

http://www.upi.com/Top_News/2008/09/18/McCain_says_hed_fire_SEC_chair/UPI-65811221757313/

Why fire him? Bush would just put someone else in there just as bad if not worse. Think Ashcroft>Gonzo>the current asswipe.

[Amonester]

173. Everything the war criminal touches turns to...

AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24

Now - 10,582.22

a difference of... (how many farts?)

[AnneD]

189. POOL UNLOCKED for after market skinny dipping.....

as Warren says, let's see who is swimming nekkid. I had so much fun today, I've taken up smoking. Now the Rules Reminder....It has to be at or under what it was when Bush took office at the closing bell. The DJIA jumped up just before the bell. Call it a death rattle, but the game is still afoot.

Prag was great to open the pool when we had a window. Since the market jumped up at the end, we have a window. Again, The Boys on WS are swimming with the sharks and blood is in the water. Will they be able to prop it up for another day or will they finally sleep with the fishes. TV cliff hangers aren't this exciting.

SO......add dates. I don't have errands tomorrow so I will post all changes bright and early. Those that guessed today will be honorary places in our Pantheon of Prognosticators