STOCK MARKET WATCH, Monday December 1

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday December 1, 2008

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 50
WHERE'S OSAMA BIN-LADEN? 2588 DAYS
DAYS SINCE ENRON COLLAPSE = 2885
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

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

---

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

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

AT THE CLOSING BELL ON November 28, 2008

Dow... 8,829.04 +102.43 (+1.16%)
Nasdaq... 1,535.57 +3.47 (+0.23%)
S&P 500... 896.24 +8.56 (+0.96%)
Gold future... 819.00 +7.70 (+0.94%)
30-Year Bond 3.49% -0.08 (-2.13%)
10-Yr Bond... 2.96% -0.04 (-1.47%)






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

Dow Theory
Why Opinions Differ and Brief Update
BY TIM W. WOOD

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

Tim Wood, still wondering how the world has changed in 100 years, offers reasons why a four-year cycle is not really four years long.

[ozymandius]

2. Today's Reports

10:00 Construction Spending Oct
Briefing.com -1.1%
Consensus -0.9%
Prior -0.3%

10:00 ISM Index Nov
Briefing.com 38.0
Consensus 38.0
Prior 38.9

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

[UpInArms]

42. U.S. Nov. ISM 36.2% lowest since 1982

09. CORRECT: U.S. Nov. ISM 36.2% lowest since 1982
10:10 AM ET, Dec 01, 2008

16. U.S. Nov. ISM 36.2% vs. 37% expected
10:01 AM ET, Dec 01, 2008

[UpInArms]

43. Oct Construction Spending @ -1.2%

Construction Spending Oct/10:00 AM -1.2% 0.0%

[ozymandius]

3. Oil falls to near $53 as OPEC doesn't cut output

SINGAPORE – Oil prices fell to near $53 a barrel Monday in Asia after OPEC declined to cut production at an informal meeting in Cairo on Saturday.

Light, sweet crude for January delivery was down $1.07 to $53.36 a barrel, after falling to as low as $52.96, in electronic trading on the New York Mercantile Exchange at mid-afternoon in Singapore. The contract settled down a penny at $54.43 on Friday.

Saudi Oil Minister Ali Naimi said Saturday that the Organization of Petroleum Exporting Countries will "do what needs to be done" to shore up falling oil prices when the group meets Dec. 17 in Algeria, but for now it was "too early."

....

In other Nymex trading, gasoline futures fell 1.70 cents to $1.19 a gallon. Heating oil dropped 2.39 cents to $1.70 a gallon while natural gas for January delivery rose 5.0 cents to $6.56 per 1,000 cubic feet.

In London, December Brent crude fell $1.20 to $52.29 on the ICE Futures exchange.

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

[Festivito]

4. Debt: 11/26/2008 10,647,917,555,364.30 (DOWN 10,438,722,489.50) (-194% of report-avg)

(Public debt up a little. FICA fluctuating. I did not post on Friday's thread until late. Government did post debt. Uninteresting though. Links at bottom. Enjoy life all.)

= Held by the Public + Intragovernmental(FICA)
= 6,395,807,621,162.60 + 4,252,109,934,201.79
UP 650,427,812.76 + DOWN 11,089,150,302.26
(NOTE: Excel 2007 cannot handle ten-trillion plus to the penny. It zeroes the penny.)

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

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

ANALYSIS:
There were 23 reports in the last 30 to 33 days.
The average for the last 23 reports is 5,389,660,848.16.
The average for the last 30 days would be 4,132,073,316.92.
The average for the last 33 days would be 3,756,430,288.11.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 39 reports in 57 days of FY2009 averaging 15.98B$ per report, 10.93B$/day.

PROJECTION:
GWB** must relinquish the presidency in 55 days.
By that time the debt could be between 10.7 and 11.2T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
11/26/2008 10,647,917,555,364.30 GWB (UP 4,919,721,759,182.73 so far since Bush took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 623,192,658,451.90 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
11/05/2008 -000,077,530,396.02 ----
11/06/2008 +056,540,493,221.63 ------------**********
11/07/2008 -000,129,624,570.02 ---
11/10/2008 -000,178,876,517.33 --- Mon
11/12/2008 +000,116,562,137.90 ------------********
11/13/2008 -037,830,308,231.82 -
11/14/2008 +039,714,906,312.49 ------------**********
11/17/2008 -001,168,758,314.18 -- Mon
11/18/2008 +035,027,406,490.17 ------------**********
11/19/2008 -000,433,628,717.22 ---
11/20/2008 -000,189,695,810.14 ---
11/21/2008 -000,151,096,322.01 ---
11/24/2008 -000,086,920,504.20 ---- Mon
11/25/2008 +001,468,316,558.23 ------------*********
11/26/2008 +000,650,427,812.76 ------------********

93,271,673,150.24 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $983,285,752,105.23 in last 69 days.
That's 983B$ in 69 days.
More than any year ever, except last year, and it's 97% of that highest year ever only in 69 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 69 DAYS NOT 365.

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

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) TUESDAY'S POST LINK:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3617309&mesg_id=3617453
Wednesday's:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3618843&mesg_id=3618947
Friday's:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3621208&mesg_id=3622712

[ozymandius]

5. AP IMPACT: US diluted loan rules before crash

WASHINGTON – The Bush administration backed off proposed crackdowns on no-money-down, interest-only mortgages years before the economy collapsed, buckling to pressure from some of the same banks that have now failed. It ignored remarkably prescient warnings that foretold the financial meltdown, according to an Associated Press review of regulatory documents.

"Expect fallout, expect foreclosures, expect horror stories," California mortgage lender Paris Welch wrote to U.S. regulators in January 2006, about one year before the housing implosion cost her a job.

Bowing to aggressive lobbying — along with assurances from banks that the troubled mortgages were OK — regulators delayed action for nearly one year. By the time new rules were released late in 2006, the toughest of the proposed provisions were gone and the meltdown was under way.

....

Many of the banks that fought to undermine the proposals by some regulators are now either out of business or accepting billions in federal aid to recover from a mortgage crisis they insisted would never come. Many executives remain in high-paying jobs, even after their assurances were proved false.

http://news.yahoo.com/s/ap/20081201/ap_on_bi_ge/meltdown_ignored_warnings

---

Thanks Republicans!

[SpiralHawk]

25. Thanks a pantload, republicon 'conservatives'

Ptoooey on degenerate republiconomics and the way they have trashed America.

[Roland99]

35. But...but...but... It was all Clinton's fault!

:sarcasm:

[ozymandius]

6. European, Asia Stocks Fall on Economy; U.S. Index Futures Drop

Dec. 1 (Bloomberg) -- Stocks in Europe and Asia fell, paring the MSCI World Index’s biggest weekly gain, as the lowest U.K. home prices in three years and a record contraction in Chinese manufacturing signaled the global economic slump is worsening. U.S. index futures also declined.

....

“Investors still think the earnings outlook is going to get worse before it gets better,” said Mark Bon, a London-based fund manager who helps oversee about $750 million at Canada Life Ltd. “There is little short-term prospect for a turnaround” in the economy, he said.

....

Standard & Poor’s 500 Index futures slipped 2 percent before a report that may show U.S. manufacturing contracted at the fastest pace in 26 years.

The National Retail Federation said 172 million U.S. shoppers went to stores and Web sites over the weekend, a 17 percent increase from a year ago and more than a forecast of 128 million. They spent an average of $372.57, up 7.2 percent from last year, according to an e-mailed survey conducted for the NRF by BIGresearch, a Worthington, Ohio-based polling firm.

http://www.bloomberg.com/apps/news?pid=20601087&sid=a7sXZ7Snm8yw&refer=home

[Hugin]

7. "according to an e-mailed survey"

Likely, a biased survey...

[ozymandius]

9. Alas, yes. I know.

E-mailed surveys are as reliable as reading tea mush in a cup.

[ozymandius]

8. Tanta of Calculated Risk is gone.

Doris Dungey, Prescient Finance Blogger, Dies at 47

The blogger Tanta, an influential voice on the mortgage collapse, died Sunday morning in Columbus, Ohio.

Tanta, who wrote for Calculated Risk, a finance and economics blog, was a pseudonym for Doris Dungey, 47, who until recently had lived in Upper Marlboro, Md. The cause of death was ovarian cancer, her sister, Cathy Stickelmaier, said.

....

Tanta used her extensive knowledge of the loan industry to comment, castigate and above all instruct. Her fans ranged from the Nobel laureate Paul Krugman, an Op-Ed columnist for The New York Times who cited her in his blog, to analysts at the Federal Reserve, who cited her in a paper on “Understanding the Securitization of Subprime Mortgage Credit.”

....

She loved the intricacies of mortgage financing and would joke about being not just a nerd on the subject but a nerd’s nerd. She eventually wrote, for the Calculated Risk site, “The Compleat ÜberNerd,” 13 lengthy articles on mortgage origination channels, mortgage-backed securities and foreclosures that constituted a definitive word on the subject.

---

She was a brilliant luminary and one of the reasons why Calculated Risk achieved a lofty perch in economics blogging.

[Hugin]

13. Very sad.

A loss to us all. :(

[UpInArms]

34. a huge loss to us all - so very young

:(

RIP Tanta

[ozymandius]

10. JPMorgan Plans To Ax The WaMu Suits (no quarter given)

Up to 19,000 employees of Washington Mutual face being laid off this weekend as JPMorgan Chase turns up the synergy on its recent acquisition.

On Friday, JPMorgan Chase said it expects to retain the 22,000 employees who work at Washington Mutual branches and 2,000 workers in the mortgage and wealth management divisions in California, spokesman Tom Kelly told Forbes.com. The company has not yet determined the total numbers to be cut in other states, but it planning to inform all former WaMu employees of their job status by Monday.

http://www.forbes.com/markets/2008/11/28/wamu-jpmorgan-jobs-markets-equity-cx_lal_1128markets19.html

[ozymandius]

11. Car sales slide shows auto crisis worsening

PARIS (Reuters) – The global automotive industry faced a fresh wave of bad news Monday, as data showed drops in Swedish, Japanese and South Korean November car sales, with figures for France, Spain and Italy due out later in the day. Automakers are cutting production as well as seeking help from governments to survive as they battle against the effects of the financial crisis and worsening economic climate on consumer confidence.

Registrations of new cars in Sweden, home to carmakers Volvo and Saab, fell 36 percent to 17,616 units in November, according to data from auto industry body Bil Sweden, the largest monthly fall since 1993.

....

France, Italy and Spain are due to release November data later in the day. European car sales are already down 5.4 percent in the first 10 months of the year, the latest data available from industry association ACEA.

....

Earlier, data showed Japan's overall car sales in November fell 18.2 percent from a year ago.

http://news.yahoo.com/s/nm/20081201/bs_nm/us_autos

[ozymandius]

12. Deep Discounts Draw Shoppers, but Not Profits

Sales in the nation’s stores were strong over the weekend, to the relief of retailers that had been expecting a holiday shopping period as slow as the overall economy.

But while spending was up, there were troubling signs in the early numbers. The bargains that drove shoppers to stores were so stunning, analysts said that retailers — already suffering from double-digit sales declines the last two months — would probably see their profits erode even further.

Also, after shoppers flooded stores on Friday, foot traffic trailed off significantly on Saturday and Sunday.

....

The National Retail Federation, adding up sales Thursday through Saturday and projected sales for Sunday, said that each shopper spent about 7 percent more this year than last year. Shoppers spent an average of $372.57 Friday though Sunday, according to the federation, a trade group.

....

“You’re looking at discounts of 50 to 70 percent off,” said Matthew Katz, managing director in the retail practice of Alix Partners, an advisory and restructuring firm. “You have to sell two to three times as much to break even.”

http://www.nytimes.com/2008/12/01/business/01shop.html?ref=us

---

We didn't do the Black Friday thingy at chez ozymandius. However we did venture into a locally owned bookstore on Sunday, walking through a heavily foot-trafficked downtown area. Foot and car traffic were light. The bookstore had a steady stream of customers but few sales.

[ozymandius]

26. Spinning Black Friday Retail Sales

A few things you can count on every year around this time:

1. Sales data for Black Friday will be touted by biased interest groups. They are invariably have an upside bias;
2. Headline writers will get it wrong
3. Survey data will be taken as the equivalent of actual sales;
4. Strong forecasts will be subsequently proven wrong;

Such is the current situation with the Black Friday sales data, with reports still trickling in from around the country.

...elaborations follow...

http://www.ritholtz.com/blog/2008/12/spinning-black-friday-retail-sales/

[Dr.Phool]

31. I never do a Black Friday. But I went out this year.

I flew my dad down for the week, and he said that he wasn't packing very much because he likes the Beall's store here, and would like to buy a few pairs of pants and shirts to take back with him.

We went to one close to the house on Friday, at noon. An hour before the big Black Friday pricing ended.

No crowd. Everything in the ad was still available. And nobody. Not one single person was in front of us in the checkout line.

[ozymandius]

14. Worldwide manufacturing data pouring in. In a word: dismal.

Russian Manufacturing Contracts for Fourth Month to Lowest Level on Record
Russian manufacturing shrank more in November than during the 1998 financial collapse as the global economic crisis drove output and new orders to record lows and companies cut jobs, VTB Bank Europe said.

Europe November Manufacturing Shrinks More Than Estimated to All-Time Low
European manufacturing contracted by the most on record and more than initially estimated, increasing pressure on the European Central Bank to step up the pace of interest-rate cuts.

Chinese Manufacturing Contracts by Record, Adds to Risk of Economic Slump
China’s manufacturing shrank by the most on record and export orders plunged, adding to evidence that recessions in the U.S., Europe and Japan are dragging down the world’s fastest-growing major economy.

U.K. Manufacturing Shrinks at Fastest Pace Since 1992; House Prices Drop
U.K. manufacturing shrank at the fastest pace in at least 16 years in November and house prices fell to the lowest since 2006, putting the Bank of England under renewed pressure to slash interest rates this week.

Manufacturing in U.S. Probably Sank Deeper Into a Recession as Sales Fell
Manufacturing in the U.S. probably contracted in November at the fastest pace in 26 years as consumers and companies worldwide cut spending, economists said before reports today.

[Ghost Dog]

19. Global recession rocks Asian, European industry

Mon Dec 1, 2008 5:11am EST LONDON/BEIJING, Dec 1 (Reuters) - European and Chinese industry activity slumped in November, Japanese officials said their economy was slowing rapidly and U.S. retailers slashed prices to lure shoppers as recession took a grip.

Bank of Japan Governor Masaaki Shirakawa warned on Monday economic conditions were deteriorating fast, and Japanese firms were finding it increasingly hard to secure credit.

...

Euro zone manufacturing activity sank to a record low in November and the outlook was equally grim.

The Markit Eurozone Purchasing Managers Index (PMI) for the manufacturing sector slumped to 35.6 in November, a low not seen in the survey's 11-year history and way below the 50 mark that separates expansions from contraction.

"The extremely weak November manufacturing purchasing managers survey intensifies fears that the euro zone's recession will be deep and prolonged," said Howard Archer, economist at IHS Global Insight.

...

Similar surveys from China showed its manufacturing industry slumped in November as new orders, especially from abroad, tumbled.

...

Stocks slid, with investors caught between ongoing aggressive steps by central banks to alleviate the sharp global downturn and increasingly grim economic data. Japan's Nikkei average dropped 1.4 percent and European stocks tumbled by 2.2 percent with banks again hard hit.

...

Expectations for more rate cuts in Britain were underlined by the UK's PMI index showing manufacturing shrank at a record pace in November after a collapse in new orders. The headline manufacturing PMI figure plunged to 34.4 from October's downwardly revised 40.7 -- both the lowest level and the biggest one-month fall in the series, which started in 1992.

/... http://www.reuters.com/article/marketsNews/idINL127181120081201?rpc=44&sp=true

[Ghost Dog]

23. Europe factories in slump, hope for big rate cuts

Mon Dec 1, 2008 6:43am EST LONDON, Dec 1 (Reuters) - Factories across Europe put in their worst performance during November since private survey records began more than a decade ago, intensifying pressure for aggressive interest rate cuts this week.

The gloomy news on euro zone and British output was accompanied by data showing inflationary pressures tumbling, removing any doubt that both the European Central Bank and the Bank of England will cut rates on Thursday. The only debate now is over the size of the cuts, with economists generally agreed there is a greater risk the central banks will deliver larger cuts than the 50 basis point consensus.

...

"The picture is very grim," said Rainer Guntermann, economist at Dresdner Kleinwort in Frankfurt, describing the euro zone data. "And it's a consistent picture - demand is falling, we're seeing output cuts, a lengthening of delivery times, employment and prices under pressure." ... "We stick to the base case for the ECB to cut rates by 50 basis points, but the data would not stand in the way of a bigger rate cut from the ECB," said Guntermann. A poll of 81 economists last week showed a majority expecting a 50 basis point cut to 2.75 percent. Just over a quarter are looking for an even bigger cut. See:

...

Companies are now cutting payrolls aggressively given this is the sixth straight month the PMI has shown contracting activity. The employment index dropped to a new record low of 41.0. On Friday, Eurostat said unemployment in the euro zone had climbed to a near two-year high of 7.7 percent in October.

...

Data released on Friday showed inflation across the 15- nation bloc plunged to 2.1 percent in November, only just above the central bank's two percent target ceiling, following a sharp decline in oil prices.

Industrial activity declined across the region, with Germany, the bloc's largest economy, posting a drop to a record-low 35.7 while France's fell to a record low of 37.3. Italian and Spanish manufacturing activity also sank to record lows at 34.9 and 29.4 respectively.

/... http://www.reuters.com/article/marketsNews/idINL131807520081201?rpc=44&sp=true

[Ghost Dog]

24. Yen extends broad gains as PMIs drag world stocks lower

Mon Dec 1, 2008 5:56am EST LONDON, Dec 1 (Reuters) - The yen extended gains against major currencies on Monday, supported by increasing investor caution as a raft of weak manufacturing surveys from around the world sent global stock markets deep into the red. The manufacturing sectors in China, UK and the euro zone contracted at the fastest pace on record in November, data on Monday showed.

At 1055 GMT the euro was down 2.3 percent against the yen at 118.45 yen <EURJPY=>, the dollar was down 1.9 percent on the day at 93.69 yen <JPY=> and sterling was down 4 percent at 140.85 yen <GBPJPY=R>, according to Reuters data.

European stocks were down more than 3 percent .FTEU3 and the three major U.S. indices were called to open down more than 2 percent.

/. http://www.reuters.com/article/marketsNews/idINL139340220081201?rpc=44

______
also:

[ozymandius]

15. Harvard-Led Push to Sell Private Equity Stakes Hits LBO Values

Dec. 1 (Bloomberg) -- A push by the richest U.S. universities to unload their stakes in private-equity funds is flooding the market, driving down prices for the world's best- known buyout firms.

Investors led by Harvard University, which manages the largest U.S. endowment at $36.9 billion, may increase so-called secondary sales of private-equity funds to more than $100 billion during the next year, overwhelming available pools of capital. Interests in funds managed by KKR & Co., Madison Dearborn LLC and Terra Firma Capital Partners Ltd. all are being offered at discounts of at least 50 percent, according to people familiar with the sales.

Crippled financial firms such as American International Group Inc. and bankrupt Lehman Brothers Holdings Inc. are joining strapped endowments such as the ones at Columbia University in New York and Duke University in Durham, North Carolina, in trying to sell private-equity stakes. A deepening global recession that is crimping the value of buyout firms' holdings is forcing further price cuts in a market where buyers already are scarce.

http://www.bloomberg.com/apps/news?pid=20601109&sid=a0zdopFBGnbY&refer=exclusive

---

We have been told for months by Krugman, Roubini, et. al. that an unwinding of private equity will be painful and lengthy. Now we see this playing out. I wonder how this is working out for children like Mankiw and Kudlow.

[ozymandius]

16. Prediction:

In the future, people will read Kudlow's books for the same reasons they read back issues of The Onion.

[ozymandius]

17. Stocks set for rough December start

LONDON (CNNMoney.com) -- U.S. stocks appeared set to kick off the final month of the year on a rough note as ongoing concerns about the global economic slowdown weighed on investors returning from the long weekend.

At 4:47 a.m. ET, Dow Jones industrial average, Standard & Poor's 500 and Nasdaq 100 futures were all lower.

....

Economy: At 10 a.m. ET, investors will take in a report on nationwide manufacturing activity in November. A reading on construction spending in October is also due out.

Big Three: Detroit's automakers will also be in focus this week amid growing bets that the industry will receive a government bailout after all.

http://money.cnn.com/2008/12/01/markets/stockswatch/?postversion=2008120105

[ozymandius]

18. latest numbers

S&P 500 -22.10 873.20 12/1 6:51am

NASDAQ -25.00 1161.00 12/1 6:16am

Dow Jones -151.00 8670.00 12/1 6:20am

[DemReadingDU]

20. Debt Rattle, November 26 2008: From the Top of the Great Pyramid

I am reposting 3 excellent items that I first posted to the Weekend Economist thread
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x405605


Ilargi usually writes the daily intro for The Automated Earth, http://theautomaticearth.blogspot.com/ but he is taking some time off, and while he is absent, there are some guest writers. If your read the DailyKos, you might be familiar with author Stranded Wind, aka Iowa Boy, who wrote intros for TAE dated 11/24/08 & 11/25/08.

The 11/26/08 intro is written by Stoneleigh, co-editor with Ilargi at The Automated Earth...

Stoneleigh: Everyone has heard of pyramid, or Ponzi, schemes. In their simplest form they are short-lived deliberate frauds where a small number of existing members are paid from the buy-in of a larger number of newer members until the supply of newer members is exhausted, whereupon they collapse. Typically, the founders, and perhaps a few others who got in early and out before it was too late, end up making a lot of money at the expense of later entrants, who end up holding the empty bag. There are always many more losers than winners. What most do not realize, however, is that Ponzi dynamics are far more pervasive than people think. There are many human systems that ultimately rest on the buy-in of new entrants, and every one of them will ultimately meet the same fate, although it can take far longer for complex constructions than for simple pyramid frauds.

What allows a more complex pyramid to last for longer than a simple one is a supplementary source of funds to pay members, besides merely the buy-in of newer members. The more such sources there are, legitimate and otherwise, the more complex the pyramid can become and the longer it will last, as the apparent on-going success of early entrants will attract many more new ones. There's nothing like seeing one's friends and neighbours seemingly making a lot of easy money for a long time to eventually overcome the mental defenses of even the most skeptical.

Following the collapse of communism in Eastern Europe, there was a spate of such schemes - notably MMM in Russia, Caritas in Romania, Jugoskandic and Dafiment Bank in Serbia, TAT in Macedonia, and VEFA Holdings, Xhafferi, Populli, Gjallica and several others in Albania. They were the topic of my academic research at the time. All of these lasted for quite a long time, and some paid out spectacular returns for much of that time. For instance, the Albanian funds , or quasi-banks, began by paying out 3-5% per month over a 6 month term and were eventually paying out 10% per month (and briefly much more as an interest rate war ensued very late in the game).

They were able to do this temporarily because the income from the buy-in of new entrants was supplemented by revenue from drug smuggling, oil sanctions busting, money laundering, gun running, human trafficking and a thriving trade in car theft from across Europe. There was some revenue from legitimate business interests, but not much in a country that survived mainly on a combination of remittances and politically supported criminal activity. Ironically, Albania was the darling of the IMF at the time.

Over time, approximately 80% of the Albanian population was drawn into the pyramids, often selling their only real property in order to invest and then depending on the pyramids for all their income. When the inevitable happened, the vast majority of the population was completely dispossessed. Although many had realized that there was something too-good-to-be-true about their 'investments' they had succumbed to greed "in the belief that they were in the hands of properly structured criminality", as The Guardian newspaper put it in February 1997. The population believed, erroneously, that there was an implicit guarantee from the government, which was conspicuously and intimately entwined with the activities of the various funds.

In the developed world, there are many examples of pyramid dynamics where there is no intent to defraud at all - where even the founders really don't understand the underlying logic of their business model taken to its logical conclusion. Direct marketing, for instance, is essentially pyramid-based - depending on an ever-increasing network of sales people, each of whom receives a percentage of their income from those they can attract into the business. If these businesses can no longer grow by attracting new salespeople, then they are ultimately finished, but as they cannot grow perpetually (or eventually everyone in the country would end up making a living selling these products to each other), they are inherently self-limiting. They can last for many years thanks to legitimate business revenues, but not forever. Early entrants will always do very well, at the expense of later ones, and the last tiers will certainly lose their stake.

Large economic bubbles, typically formed in dominant economies during periods of manic optimism (see McKay's Extraordinary Public Delusions and the Madness of Crowds), have the same underlying dynamic. Without continual buy-in from new money - new investors or more money from existing investors - they cannot grow, and when they can no longer grow, they will collapse. Although grounded initially in legitimate business activity, they morph into structures where one has to question the motives and understanding of key individuals. In some cases there may be intent to defraud, but what is far more common is a characteristic recklessness as to the risks those in control are prepared to take with other people's money.

In their latter stages, such structures hollow out, feeding on their own internal substance as they lose the ability to attract new investment. In the terminal phase, there is the appearance of great wealth, but it is virtual, and therefore extremely ephemeral. The next step is implosion, as the virtual wealth disappears - where the claims to wealth generated through leverage that exceed the amount of underlying real wealth are extinguished en masse. Enron was a prime example, and on a much larger scale, so is the derivatives market. Bubbles, like all Ponzi structures, are inherently self-limiting and will always collapse in the end.

At the largest scale, empires are also grounded in pyramid dynamics, which is why they too have a limited lifespan. They grow by assuming control, either politically or economically, of new territories, positioning themselves to cream off surpluses from an ever-expanding geographical area in a form of involuntary buy-in. In the past political control through invasion or physical colonization was more common, but latterly globalization has enabled the development of a sophisticated system of economic control based on international debt slavery, supplemented with economic colonization for the purpose of resource extraction. Both resources and financial surpluses, in the form of perpetual interest payments, could be efficiently extracted from the periphery and accumulated at the centre, where they led to the development of an unprecedented level of socioeconomic complexity.

Such wealth conveyors in favour of the economic centre, at the expense of the hinterland, are the very heart of empire, but without continual expansion to feed rapidly developing central complexity, they eventually fail, leaving the centre unable to sustain its existing complexity level. As with economic bubbles, empires hollow out in the latter stages, consuming their own substance in a catabolic manner in order to compensate for the inability to strengthen wealth conveyors sufficiently quickly to keep pace with the expanding requirements of the centre.

As the hinterland is increasingly stripped of wealth and resources, and burdened with the increasing environmental impact of its own exploitation, an increasing fraction of it is left too impoverished to sustain a minimum level of internal order. In modern times we speak of failed states without realizing why many of these states are failing, or the impact that an increasing number of failed states will ultimately have on our own standard of living.

Wealth conveyors are breaking down, and no amount of financially squeezing the population in the central economies can compensate for the loss of that ability to accumulate wealth from virtually the whole world. The vast majority of the central population will be brutally squeezed as the elites try to hang on to their own privileged position, but this can only sustain a very small, and rapidly shrinking, fraction of the population, and at great cost.

We are living through the collapse of the final - and all-consuming - economic bubble at the end of the American empire.

click for related articles followed by the comments section
http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-26-2008-from-top.html


edit
Stoneleigh also posted this as a diary at the Daily Kos
http://www.dailykos.com/story/2008/11/26/172953/05

[DemReadingDU]

21. Debt Rattle, November 29 2008: "Inflation" deflated

11/29/08 As mentioned above in the first posting, Ilargi is taking some time off from http://theautomaticearth.blogspot.com / .While he is absent, there are some guest writers. Stoneleigh writes another intro for TAE (The Automatic Earth).

Stoneleigh: There are many things we have discussed here frequently that come up as questions in the comments because we are attracting new readers all the time. I thought it would be a good time to answer those questions en masse, so that there would be a URL to point to if the same questions should come up again.

The basic point is that we here at TAE are expecting deflation. Although inflation and deflation are commonly thought of as descriptions of rising or falling prices, this is not the case. Inflation and deflation are monetary phenomena. The terms represent either an increase or a decrease, respectively, in the supply of money and credit relative to available goods and services. Rising prices are often a lagging indicator of an increase in the effective money supply, as falling prices are of a decrease. There is an important distinction to be made between nominal prices and real prices, however. Nominal prices can be misleading as they are not adjusted for changes in the money supply and so do not reflect affordability. Real prices, which are so adjusted, are a far more important measure.

Nominal prices typically rise during inflationary times as there is more money available to support higher prices, but prices need not rise evenly, and some prices may fall, depending on other factors. In real terms the picture would be quite different, as increases would be smaller and decreases would larger. When nominal prices fall despite inflation, it means that the price in real terms is plummeting. For instance, global wage arbitrage allowed the price of imported goods to fall drastically in real terms. In deflationary times, nominal prices typically fall across the board, but prices need not fall in real terms, and, in cases of scarcity, may well rise.

The easy availability of cheap credit has conveyed a considerable amount of price support - price support that will be progressively withdrawn as credit tightens. Prices will fall, but the collapse of credit will cause purchasing power to fall faster than price, leading to the apparent paradox of nominally cheaper goods being less affordable in the future than nominally more expensive goods are today. Moreover, there are likely to be substantial changes in relative prices between essentials and non-essentials. As a much larger percentage of a much smaller money supply will be chasing essentials such as food and energy, there will be relative price support for those items. In other words, while everything is becoming less affordable due to the collapse of purchasing power, essentials such a food and energy will be the least affordable of all, whatever the nominal price. People commonly speak of unaffordable prices as a result of inflation, but do not realize that deflation can have the same effect, only much more abruptly.

Thanks to a credit boom that dates back to at least the early 1980s, and which accelerated rapidly after the millennium, the vast majority of the effective money supply is credit. A credit boom can mimic currency inflation in important ways, as credit acts as a money equivalent during the expansion phase. There are, however, important differences. Whereas currency inflation divides the real wealth pie into smaller and smaller pieces, devaluing each one in a form of forced loss sharing, credit expansion creates multiple and mutually exclusive claims to the same pieces of pie. This generates the appearance of a substantial increase in real wealth through leverage, but is an illusion. The apparent wealth is virtual, and once expansion morphs into contraction, the excess claims are rapidly extinguished in a chaotic real wealth grab. It is this prospect that we are currently facing today, as credit destruction is already well underway, and the destruction of credit is hugely deflationary. As money is the lubricant in the economic engine, a shortage will cause that engine to seize up, as happened in the 1930s. An important point to remember is that demand is not what people want, it is what they are ready, willing and able to pay for. The fall in aggregate demand that characterizes a depression reflects a lack of purchasing power, not a lack of want. With very little money and no access to credit, people can starve amid plenty.

Attempts by governments and central bankers to reinflate the money supply are doomed to fail as debt monetization cannot keep pace with credit destruction, and liquidity injected into the system is being hoarded by nervous banks rather than being used to initiate new lending, as was the stated intent of the various bailout schemes. Bailouts only ever benefit a few insiders. Available credit is already being squeezed across the board, although we are still far closer to the beginning of the contraction than the end of it. Further attempts at reinflation may eventually cause a crisis of confidence among international lenders, which could lead to a serious dislocation in the treasury bond market at some point. If a debt-junkie economy can no longer easily raise funds, then interest rates would rise substantially and spending at home would be drastically cut. This would be the financial equivalent of hitting the 'emergency stop' button on the economy, as it would cause a far larger rash of defaults than anything we have seen so far. We are not there yet though. Currently the dollar is benefiting from an international flight to safety, and it will probably continue to do so for some time, despite temporary counter-trend pullbacks from time to time.

We have seen a pattern of ebb and flow of market liquidity since February 2007, when the credit crisis arguably began. A constellation of market trends has largely moved in synch with liquidity. As liquidity falls, equities fall, bond yields fall (and prices rise), commodities fall, precious metals fall, real estate falls and the dollar rises, as cash becomes king. When we see market rallies, in contrast, rallies in bond yields, commodities, and metals are also common, and the dollar experiences a pullback. We appear to be beginning a market rally at the moment, which should lead to precisely this set of trend reversals. Such a rally is only temporary relief however. It may last for a couple of months, but then the decline should resume with a vengeance.

We have a very long way to fall, and the deleveraging process is likely to play out over several years. During this time we can expect to be mired in a worse depression than the 1930s, as the excesses that led to our current situation are far worse by every measure than were those of the Roaring Twenties. Unfortunately, we are much less prepared to face such an occurrence than were our grandparents. Our expectations are far higher, our knowledge and skill base is much less appropriate, we are far less self-sufficient and we have a structural dependency on cheap energy. This will be a very painful time. Deflation and depression are mutually reinforcing, leading to a vicious circle of decline that is very difficult to escape. It will be over when the (small amount of) remaining debt is acceptably collateralized to the (few) remaining creditors. At that point trust will begin to rebuild.

For a longer and more detailed explanation of the credit bubble and deflation see The Resurgence of Risk - A Primer on the Develop(ed) Credit Crunch. This an article I wrote in August 2007 that was recently rerun on The Oil Drum, where I used to be an editor.

Click for related articles and comments
http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-29-2008-inflation.html


Here is the direct link to Stoneleigh's article: The Resurgence of Risk - A Primer on the Develop(ed) Credit Crunch
http://www.theoildrum.com/node/4629

[DemReadingDU]

22. Debt Rattle, November 30 2008: How to Build a Lifeboat

11/30/08
Stoneleigh: Yesterday we talked about why we are facing deflation and today I wanted to review and explain the suggestions we have made previously for dealing with a deflationary scenario. In short, this is the list we have run periodically since we started TAE (with one addition at the end):

1) Hold no debt (for most people this means renting)
2) Hold cash and cash equivalents (short term treasuries) under your own control
3) Don't trust the banking system, deposit insurance or no deposit insurance
4) Sell equities, real estate, most bonds, commodities, collectibles (or short if you can afford to gamble)
5) Gain some control over the necessities of your own existence if you can afford it
6) Be prepared to work with others as that will give you far greater scope for resilience and security
7) If you have done all that and still have spare resources, consider precious metals as an insurance policy
8) Be worth more to your employer than he is paying you
9) Look after your health!

1) The reason that getting rid of debt is priority #1 is that during deflation, real interest rates will be punishingly high even if nominal rates are low. That is because the real rate (adjusted for changes in the money supply) is the nominal rate minus inflation, which can be positive or negative. During inflationary times, this means that the real rate of interest is lower than the nominal rate, and can even be negative as it was during parts of then 1970s and again in the middle of our own decade. People have taken on huge amounts of debt because they were effectively being paid to borrow, but periods of negative real interest rates are a trap. They lure people into too much debt that they may not be able to service if real rates rise even a little. Most people are thoroughly enmeshed in that trap now as real rates are set to rise substantially.

When inflation is negative (i.e. deflation), the real rate of interest is the nominal rate minus negative inflation. In other words, the real rate is higher than the nominal rate, possibly significantly higher. Even if the nominal rate is zero, the real rate can be high enough to stifle economic activity, as Japan discover during their long sojourn in the liquidity trap. Standard money supply measures don't necessarily capture the scope of the problem as they don't adequately account for on-going credit destruction, when credit has come to represent such a large percentage of the effective money supply.

The difficulty from the point of view of debtors can be compounded by the risk that nominal interest rates will not stay low for years, as they did in Japan, but may shoot up as the international debt financing model comes under stress. For instance, on-going bailouts may cause international lenders to balk at purchasing long term treasuries for fear of their effect on the value of the dollar, even though those bailouts are not increasing liquidity thanks to hoarding behaviour by banks. We are not there yet, but the probability of this scenario rises as we move forward with current policies. The effect would be to send nominal interest rates into the double digits, and real interest rates would be even higher. The chances of being able to service existing debts under those circumstances are not good, especially as unemployment will be rising very quickly.

There is no safe level of debt to hold, including mortgages. For those who are not able to own a home outright, most would be much better off selling and renting, as real estate becomes illiquid faster than almost anything else in a depression. By the time you realize that you need to sell because you can no longer pay the mortgage, it may be too late. Renting is essentially paying someone else a fee to take the property price risk for you, which is a very good bet during a real estate crash. It would also allow you address point #2 - having access to liquidity.

2) Holding cash and cash equivalents (i.e. short term treasuries) is vital as purchasing power will be in short supply. Cash is king in a deflation. Access to credit is already decreasing and will eventually disappear for ordinary people. Mass access to credit has been a product of an historic credit expansion that expanded the supply of pockets to pick to an unprecedented extent, feeding off widespread debt slavery in the process. As you can't count on the availability of credit for much longer, you will need savings in liquid form that you can always access.

When interest rates spike, not only will debt become a millstone round your neck, but a debt-junkie government forced to pay very high rates will be in the same position. As a result government spending will have to be cut drastically, withdrawing the social safety net just as it is most needed. In practical terms, this means being on your own in a pay-as-you-go world. You do NOT want to face this eventuality with no money.

3) Keeping the savings you need in the banking system is problematic. The banking system is deeply mired in the crisis in the derivatives market. Huge percentages of their assets are not marked-to-market, but marked-to-make-believe using their own unverifiable models. The market price would be pennies on the dollar for many of these 'assets' at this point, and poised to get worse rapidly as the forced assets sales that are coming will lower prices further. The losses will eventually dwarf anything we have seen so far, pushing more institutions into mergers or bankruptcy, and mergers are becoming more difficult as the pool of potential partners shrinks.

If we do see a rash of bank failures, each of which weakens the position of others as the sale of their assets and unwinding of their derivative positions can re-price similar 'assets' held by other parties, then deposit insurance will not be worth the paper it's written on. When everything is guaranteed, nothing is, as the government cannot guarantee value. Savings held in these institutions are at much higher risk than commonly thought due to the systemic threats posed by a derivatives meltdown and spreading crisis of confidence. Fractional reserve banking depends on depositors not wanting their money back all at once, in fact with reserve requirements so whittled away in recent years, it depends on no more than a fraction of 1% of depositors wanting their money back at once. This is a huge vulnerability and the government deposit guarantee is a bluff waiting to be called.

4) The general rule of thumb in a deflation is to sell everything that isn't nailed down and then sell whatever everything else is nailed to, for the reasons that assets prices will fall further than most people imagine to be possible, and the liquidity gained by selling (hopefully) solves the debt and accessible savings problems (provided you don't lose the proceeds in a bank run). Assets prices will fall because everywhere people will be trying to cash out, by selling not what they'd like to, but what they can. This means that all manner of assets will be offered for sale at once, and at a time when there are few buyers, this will push prices down to pennies on the dollar for many assets.

For those few who still have liquidity, it will be a time when there are many choices available very cheaply. In other words, if you manage to look after the proceeds from the sale of your former assets, you should be able to buy them back later from much less money. Of course flashing your wealth around at that point could be highly inadvisable from a personal safety perspective, and you may find that you'd rather hang on to your money anyway, since it will be getting harder and harder to earn any more of it. During the Great Depression, some of the best farms in the country were foreclosed up on and received no bids at auction, not because they had no value, but because those few with money were hanging on to it for dear life.

Being entirely liquid has its own risks, which is why I wouldn't sell assets that insulate you from economic disruption if you didn't buy them on margin (ie with borrowed money that you may not be able to pay back) and if you have enough liquidity already that you can afford to keep them. For instance, a well equipped homestead owned free and clear is a valuable thing indeed, whatever its nominal price. It is totally different from investment real estate owned on margin, where the point of the exercise is property price speculation at a time when doing so is disastrous.

One important point to note with regard to commodities is that commodities have already fallen along way since I first published the above list of suggestions. At that time, selling commodities was a very good idea, but now, since commodities are already down a very long way, it may depend on the commodity in question. If you only own commodities in paper form then selling is still a good idea in my opinion, as there are generally more paper claims than there are commodities, and excess claims will be extinguished. At some point soon I will write an intro on my view of energy specifically, since energy is the master resource. In short, we are seeing a demand collapse now, but eventually we will see a supply collapse, and it is difficult to predict which will be falling fastest at which times.

5) If you already have no debt and have liquidity on hand, I would strongly suggest that you try to gain some control over the essentials of your own existence. We live in a just-in-time economy with little inventory on hand. Economic disruption, as we are already seeing thanks to the problems with letters of credit for shipments, could therefore result in empty shelves more quickly than you might imagine. Unfortunately, rumours of shortages can cause shortages whether or not the rumour is entirely true, as people tend to panic buy all at once. If you want to stock up, then I suggest you beat the rush and do it while it's still relatively easy. You need to try to ensure supplies of food and water and the means to keep yourselves warm (or cool as the case may be). Storage of all kinds of basic supplies is a good idea if you can manage it - medicines, first aid supplies, batteries, hand tools, wind-up radios, solar cookers, a Coleman stove and liquid fuel for it, soap etc.

At the moment, there are many things you can obtain with the internet and a credit card, but that will not be the case in the future. Water filters are a good example, as the quality of water available to you is likely to deteriorate. You can buy the kind of filters that aid agencies use oversees for all of about $250, with extra filter elements for a few tens of dollars at sites such as Lehmans Non-Electric Catalogue or the Country Living Grain Mill site.

6) Most people will not be able to get very far down this list on their own, which is why we suggest working with others as much as possible and pooling resources if you can bring yourself to do so. Together you can achieve far greater preparedness than you could hope to do alone, plus you will be building social capital that will stand you in good stead later on.

7) If you have already taken care of the basics, then you may want to put at least some of whatever excess you still have into precious metals (in physical form). Although the price of metals should still have further to fall, since distressed sales have not yet had an effect on price, obtaining them could get more difficult. Buying them now would amount to paying a premium price for an insurance policy, which may make sense for some and not for others. Metals will hold their value over the long term as they have for thousands of years, but you may have to sit on them for a very long time, so don't by them with money you might need access to over the next few years.

Metal ownership may well be made illegal, as it was during the Great Depression, when gold was confiscated from safety deposit boxes without compensation. That doesn't stop you owning it, but it does make ownership far more complicated, and makes trading it for anything you might need even more so. You could easily attract the wrong kind of attention and that could have unpleasant consequences. In short, gold is no panacea. Other options may be far more practical and useful, although there is an argument for having a certain amount of portable wealth in concentrated form if you should have to move suddenly.

8) Being worth more to your employer than he is paying you is a good idea at a time when unemployment is set to rise dramatically. This is not the time to push for a raise that would make you an expensive option for a cash-strapped boss, and in fact you may have to accept pay cuts in order to keep your job. During inflationary times, people can suffer cuts to their purchasing power year after year, but they don't complain because they don't notice that their wage increases are not keeping up with inflation. However, deflation brings the whole issue into the harsh light of day.

People would have to take pay and benefit cuts for their purchasing power to stay the same, thanks to the increasing value of cash, but keeping people's purchasing power the same will not be an option for most employers, who will be struggling themselves. In other words, expect large cuts to pay and benefits. As unions will never accept this, for obvious reasons, since their membership has its own fixed costs, there will be war in the labour markets, at great cost to all. You need to reduce your structural dependence on earning anything like the amount of money you earn now, and don't expect benefits such as pensions to be paid as promised.

9) Your health is the most important thing you can have, and most citizens of developed societies are nowhere near fit and healthy enough. Already medical bills are the most common reason for bankruptcy in the US, and while you can't protect yourself against every form of medical eventuality, you can at least improve your fitness. You will be be living in a world where hard physical work will be much more prevalent than it is now, and most people are ill-equipped to cope. The solution Ilargi and I have chosen, as we have mentioned before, is the P90X home fitness programme. While it wouldn't be the right choice for everyone, if I can do it, as I have for 11 months already, then most people can. For others, there are gentler options available, but everyone should consider doing something to make themselves as healthy and robust as possible.

We here at TAE wish you the best of luck at this difficult time. We will all need it.

click for related articles and comments
http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-30-2008-how-to.html


p.s. Ilargi and Stoneleigh are co-editors of http://theautomaticearth.blogspot.com /


edit
Stoneleigh combined these last 2 and posted them as a diary at the Daily Kos
http://www.dailykos.com/story/2008/11/30/15423/763


This was also posted over at Karl Denninger's tickerforum
http://www.tickerforum.org/cgi-ticker/akcs-www?post=73368

[tclambert]

27. Re: #3: How do you feel about credit unions vs. banks?

Thanks for the list. I've been looking for advice that made sense during times like these, when normal investment principles don't apply. Of course, it's hard to implement many of these pointers in a timely fashion. Still, I feel reassured I'm headed in the right direction.

And might I add, I like the format you used--bullet items in concise form, followed by longer explanations. Neatly done.

[DemReadingDU]

30. Thanks, but I'm not Stoneleigh

:)

but myself, I have both bank and credit union, no stocks nor bonds, and 4-week Treasury Bills purchased via http://treasurydirect.gov/


If you have questions for Stoneleigh, you could ask them at
http://theautomaticearth.blogspot.com/

There is no need to register, but it is advisable to pick a pseudonym other than anonymous, so she knows who to respond to. Since she also has a full-time job, she sometimes saves up the questions and responds to them on weekends when she has more time.

Also, there is some great info by reading the archives, located on the right side of the page. There is an interesting picture at the top of each daily posting too.

[snot]

40. HUH?!?

OK; i was about to retire, what am i supposed to do with this??? etc.: "You could easily attract the wrong kind of attention and that could have unpleasant consequences. In short, gold is no panacea. Other options may be far more practical and useful, although there is an argument for having a certain amount of portable wealth in concentrated form if you should have to move suddenly."

i've worked hard for decades, invested conservatively, etc., & seen my retirement melt in 2 mos., etc. i don't have 10 yrs. (optimisticially) to wait for recovery.

[DemReadingDU]

48. If you are interested in gold, you could search

search The Automatic Earth to see what Stoneleigh has said about gold,

http://www.google.com/custom?domains=theautomaticearth.blogspot.com&q=%22Stoneleigh+said%22+gold&sitesearch=theautomaticearth.blogspot.com&sa=Google+it&client=pub-2932170066448720&forid=1&ie=ISO-8859-1&oe=ISO-8859-1&cof=GALT%3A%23008000%3BGL%3A1%3BDIV%3A%23336699%3BVLC%3A663399%3BAH%3Acenter%3BBGC%3AFFFFFF%3BLBGC%3A336699%3BALC%3A0000FF%3BLC%3A0000FF%3BT%3A000000%3BGFNT%3A0000FF%3BGIMP%3A0000FF%3BFORID%3A1&hl=en

or
http://tinyurl.com/5c5nwq

You could also leave questions at http://theautomaticearth.blogspot.com/

[TrogL]

56. STOP LISTENING TO GOLD BUGS

Their only purpose in life is to drive up the price of their gold shares, or to have some sucker to dump their horde just before the next drop.

Hence they will tell you the exact opposite of what you need to know almost all of the time.

[AnneD]

62. Gold....

I have a sentimental weakness. I don't try to time it anymore or recommend it one way or the other. I just like having some around (the old yellow dog theory). I sleep better at night knowing that it always retains value and is portable wealth. I never feel poor when I have a little bit on me.

[tclambert]

64. For portability, $100 bills weigh less than gold.

I did the arithmetic one time when a stupid movie had a $10 million ransom in hundreds supposedly fitting in a slim attache case. Turns out that many hundreds would weigh about 200 pounds. But gold would weigh more (about 4 times more). For portability, you can't beat diamonds. But the big question is: What will hold its value in this economy? Myself, I've been wishing I had a way to store a few thousand gallons of gasoline. You know that's going back up as soon as Exxon Mobil and the Saudis can arrange it.

[AnneD]

79. A $100 bill may weigh less....

but it's value is based on trust. I haven't felt trusting of the government for a long time and basically have very little trust in any governmant in time of turmoil.

My advice-don't put your eggs in one basket. Gold and silver, stocks, bonds, cash, canned goods, guns and ammo. Be prepared

[ozymandius]

94. One ten-year-old student once asked me 'what gives money its value?'

I paused, with my jaw slackened somewhat, and said, "That is a lesson for when we have more time. But for now, let me say that its a huge amount of faith."

"Faith in what?" student asks.

"Faith," I said, "that it is worth something."

It's worth something because they say so. And that is horrifying when one considers what has been valued as currency over the ages because someone says it's valuable.

[AnneD]

100. That is the one shocking fact.....

that I always had trouble wrapping my mind around. Value based on trust. Puka beads, cocoa beans, sticks of wood, stones, and hides have all been money at some point.

[Demeter]

103. It's a Social Compact

A unit of money represents some work done or a hard asset, and is accepted in lieu of barter. So we don't have to drag sacks of wheat or pigs around with us.

[Ghost Dog]

28. Banks, commods lead Europe shares lower at midday

Mon Dec 1, 2008 12:02pm GMT LONDON, Dec 1 (Reuters) - European shares fell back at midday on Monday after recessionary concerns gripped investors with banks and commodities the biggest losers.

By 1132 GMT, the FTSEurofirst 300 index of top European shares was down 3 percent at 836.23 points.

...

BNP Paribas (BNPP.PA: Quote, Profile, Research), Societe Generale (SOGN.PA: Quote, Profile, Research) and Credit Agricole (CAGR.PA: Quote, Profile, Research) slipped 2.7-6.3 percent after traders cited mounting worries over Brussels' green light to the French government's package for the ailing sector. Royal Bank of Scotland (RBS.L: Quote, Profile, Research) gave up earlier gains and was down 2 percent as Italian yellow pages publisher Seat Pagine Gialle (PGIT.MI: Quote, Profile, Research) said it had started talks with the group on "enhancing its financial flexibility" under an existing senior loan agreement. Irish banks were higher after the Irish Examiner reported that they will move in the coming weeks to facilitate investments of up to 10 billion euros in fresh capital from government, private equity and other sources. Allied Irish Banks (ALBK.I: Quote, Profile, Research) and Bank of Ireland (BKIR.I: Quote, Profile, Research) were up 1.1 and 0.6 percent, respectively.

Across Europe, the FTSE 100 index was down 2.3 percent, Germany's DAX was 3.3 percent lower and France's CAC 40 was down 2.5 percent.

...

Miners were in the doldrums. Xstrata (XTA.L: Quote, Profile, Research, Stock Buzz) slipped 6.5 percent after the group said that it would temporarily suspend a further five ferrochrome furnaces at its joint venture with South Africa's Merafe Resources (MRFJ.J: Quote, Profile, Research, Stock Buzz), raising the cuts in annual production to 906,000 tonnes. Anglo American (AAL.L: Quote, Profile, Research, Stock Buzz), Antofagasta (ANTO.L: Quote, Profile, Research, Stock Buzz), BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) and Lonmin (LMI.L: Quote, Profile, Research, Stock Buzz) were down 3.6-11.4 percent.

Steelmakers, Arcelor Mittal (MTP.PA: Quote, Profile, Research, Stock Buzz), ThyssenKrupp (TKAG.DE: Quote, Profile, Research, Stock Buzz) and Salzgitter (SZGG.DE: Quote, Profile, Research, Stock Buzz) were 5.1-8.4 percent lower after a profit warning from Finnish sector peer Rautaruukki (RTRKS.HE: Quote, Profile, Research, Stock Buzz).

/... http://www.reuters.com/article/marketsNews/idCAL168953320081201?rpc=44

[Ghost Dog]

52. European shares tumble as commods, banks slide

Mon Dec 1, 2008 11:41am EST LONDON, Dec 1 (Reuters) - European shares slumped on Monday, pressured by banks and commodity stocks, as mounting concerns about a prolonged global slowdown and weaker demand for oils and metals hurt market sentiment.

The FTSEurofirst 300 index of top European shares provisionally closed 6.3 percent down at 808.13 points after rising 13 percent last week. The benchmark is down 46 percent so far this year after posting gains in the previous five years.

Banks were the worst hit, with Standard Chartered Bank (STAN.L: Quote, Profile, Research, Stock Buzz) falling 14.7 percent and UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) down 12 percent. Commodities slipped due to an 8 percent drop in crude and a 2.8 percent fall in aluminium prices on worries about global growth.

"The short-term outlook is going to be very difficult, given the weakening growth forecast, falling corporate profitability and the softening labour market," said Henk Potts, equity strategist at Barclays Stockbrokers. "What the market would need to see is the practical implication of the measures that have been announced starting to work through the system and having a positive result."

A United Nations report said that world economic growth would slow to 1 percent in 2009 from 2.5 percent this year as the financial crisis bit, and the global economy might even contract if stimulus packages proved too little too late.

/... http://www.reuters.com/article/marketsNews/idCAL162709020081201?rpc=44

[Ghost Dog]

53. FTSE slides 5.2 pct on commodities, gloomy UK data

LONDON, Dec 1 (Reuters) - Britain's leading share index slid 5.2 percent on Monday as concerns over demand for raw materials hit heavyweight commodity stocks, while weak data highlighted problems facing the UK economy.

The FTSE 100 .FTSE closed 222.52 points lower at 4,065.49, after gaining 13.4 percent last week, its best-ever weekly performance. More than 1.0 billion shares changed hands, compared with last week's daily average of 1.29 billion.

The UK benchmark had lost 2 percent last month and is down 37 percent for the year on fears of a severe global recession.

...

"Policymakers are now perhaps acknowledging the depth of this potential recession we are heading towards, if not in, and the historic level of challenges the economy are facing," said Tim Hughes, head of sales trading at IG Index. "Then clearly the logical consequence is that is half point rate cut enough?" ... "There is a lot of that kind of doom and gloom looking around and thinking what's there to be cheerful about. Retailers are ... adding to that housing woes and still tight credit situation."

Investors will eye interest rate decisions this week from both the Bank of England and the European Central Bank, with both expected to serve up further monetary policy easing on Thursday.

...

House prices in England and Wales fell by 1.1 percent in November to take them 8.1 percent lower on a year ago, property consultancy Hometrack said in its monthly survey.

...

Further, heavy discounting by Britain's retailers has failed to boost shopper numbers and the rate of business failures in the industry is accelerating, surveys by researchers Experian showed.

...

Morgan Stanley said in a note that 2009 was "likely to be another testing year" for UK equity investors.

"Traditional valuation metrics suggest equities are very cheap and are, arguably, pricing in as much as 50 percent drop in earnings," Morgan Stanley's Graham Secker and Charlotte Swing said. "However, the fragility of the financial and macro backdrop may continue to suppress risk appetite. If investors choose to apply a trough multiple on trough earnings, we think there could be 30-40 percent more downside to stocks," they said, adding that their 12-month FTSE 100 target was 4,300.

/... http://www.reuters.com/article/marketsNews/idCAL155405220081201?rpc=44&sp=true

[Ghost Dog]

54. Europe mulls spending hikes as world factories slow

WASHINGTON/LONDON (Reuters) - European leaders clashed on Monday over how much public money to spend on battling recession as data showed factories were slashing output in the United States, Europe and China.

The Bank of Japan called an emergency meeting for Tuesday to find ways to cut corporate borrowing costs. BOJ Governor Masaaki Shirakawa warned access to funding was becoming increasingly tough for Japanese firms, to an extent comparable with a debilitating credit crunch a decade ago.

In a sign of how drastically the deepening economic gloom was curbing demand, U.S. manufacturing activity in November fell to its weakest in 26 years. A similar reading on euro zone factories sank to a record low.

China's manufacturing sector also slumped in November as new orders tumbled, showing the world's fourth-largest economy was being sucked deeper into the global maelstrom.

The financial crisis that began with a U.S. housing market collapse last year has already knocked several big economies into recession, including the euro zone. Most economists believe the United States and Britain will soon follow.

Euro-zone finance ministers gathered in Brussels to flesh out the European Commission's 200 billion euro ($252 billion) plan to revive their economies, but Germany rejected calls to step up its stimulus spending.

The Commission proposed last week that European Union countries spend an extra 1.2 percent of GDP from their budgets, mainly in 2009, to boost investment and consumer demand.

"It's clear that we need to do something and it needs to be substantive," Dutch Finance Minister Wouter Bos said.

Agreement may prove elusive. German Chancellor Angela Merkel told her party on Monday the government, which has unveiled a 32 billion euro plan, would not go on a spending spree to please its neighbors.

"We will not take part in a competition to outdo one another with an endless list of new proposals, in a senseless contest over billions," Merkel said.

French President Nicolas Sarkozy criticized Merkel's lukewarm reaction last week, saying: "While France is working, Germany is thinking."

RATE CUTS COMING

Central banks in Britain, the euro zone, Australia and New Zealand are expected to cut borrowing costs sharply this week in response to the crisis.

/... http://biz.yahoo.com/rb/081201/business_us_financial.html?.v=8

[UpInArms]

29. dollar watch

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

Last trade 86.847 Change +0.230 (+0.30%)

Throwing Cash Like Monopoly Money

http://www.bktraderfx.com/site/fx-weekly-reports/fx-weekly-throwing-cash-like-monopoly-money-1128-120408#more-684

To paraphrase senator Dirksen a trillion here, a trillion there and pretty soon you are talking real money. This week’s expansion of the Fed’s balance sheet by another $800 Billion was good example of that well worn maxim. Certainly the currency markets did not look kindly on the news, as the EUR /USD soared more than 300 points post announcement.

As we noted that day,”The trade in the dollar therefore has shifted from seeing the greenback as the safe haven asset and the ultimate reserve currency in a credit crunch world, to one where concern over the inflationary implications of so much debt being backstopped by the Fed and the US Treasury could make the buck vulnerable as we approach the end of the calendar year.”

But the rally EUR/USD did not last. The pair ran into massive supply at the 1.30’s as month end fixes overwhelmed any immediate fears about dollar’s inflationary collapse. For the time being range continues to be the dominant theme as every breakout turns into a fake-out crushing the hopes of both bulls and bears.

Next week the focus will turn to the US Non-Farm payroll report as trader steel themselves for a possible -300K number. Given the 500K+ weekly jobless claims this month a large loss of jobs is almost assured but unless the print is woefully worse than the -285K expected it is unlikely to trigger much of a move in EUR/USD.

With Obama Administration still two months away from taking office, technical factors such as end of year fixes are more likely to dominate flows. As dollar repatriation picks up pace in December, the greenback may see one more round of buying, but on a longer term time frame the salad days of the dollar rally appear to be over and consolidation continues to be the dominant play in FX

...more...

US Dollar Gains, But Fails to Recoup Week's Losses - US ISM Reports, NFPs Bound to Shake Things Up

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/US_Dollar_Gains__But_Fails_1227913495955.html

The US dollar generally ended the week lower across the majors, but lacked the momentum to yield the breakouts expected amidst the low volume trading typical of US market holidays. On Friday during the European trading session, the greenback jumped but lackluster price action during the US session left the major currency pairs within well-defined ranges. In fact, EUR/USD has held firmly between 1.2425 and 1.3075 since late October, GBP/USD has not been able to break above 1.55 since falling below on November 11, and the USD/JPY remains below falling trendline resistance that has held since mid-October.

Looking ahead to the next week, event risk will pick up quite a bit for the greenback. On Monday, ISM Manufacturing is forecasted to slip to a fresh 16-year low of 37.5 from 38.9, and would also mark the fourth straight month that the index held below 50, signaling a contraction in business activity. Manufacturers are facing increasingly rocky times in light of slowdowns in the US and abroad, which is impacting both domestic and foreign demand. On Wednesday, ISM Non-Manufacturing is forecasted to drop to a new record low of 42.0 from 44.4, which will only add to speculation that Q4 GDP will be just as disappointing as the Q3 results, if not more. Last, but not least, US non-farm payrolls on Friday are sure to garner significant attention from the media and traders alike as they are forecasted to fall negative for the 11th straight month and by the most since September 2001. Furthermore, the unemployment rate is anticipated to rise to 6.8 percent - the highest since August 1993 - from already lofty levels of 6.5 percent.

It is rather obvious that the markets are expecting a round of pretty disappointing releases, but the big question is: how will the US dollar respond? Last week, the US dollar generally responded to fundamentals reports by falling when data suggested the Federal Reserve would cut rates further. This differs from previous weeks when the greenback responded solely to risk trends, as the currency would rise during times of risk aversion and stock market declines and vice versa. As a result, gauging the impact of risk sentiment on the forex markets will be important at the start of next week since it may determine whether the US dollar will break higher or fall for a deeper retracement.

...more...

[ozymandius]

32. I hope you all have an easy day.

It's time for me to get busy. I'll check back this afternoon.

:hi:

[DemReadingDU]

33. Visual chart: How Much Does the Bailout Really Cost?

11/30/08
Most people would agree that it is difficult to put the cost of bailing out our financial system into real terms. Including the recent Citi (C) rescue, some estimates are as high as $4.6 trillion dollars in total costs. So, we would be remiss in not sharing this shocking visual representation of the government bailout as it currently stands. The chart needs little explanation to get its point across. Jim Bianco of Bianco Research has crunched the numbers, compounding each of these historic government expenditures by the rate of inflation (using CPI) so we can compare apples to apples.

http://seekingalpha.com/article/108434-how-much-does-the-bailout-really-cost?source=article_lb_articles


edit
11/25/08 more charts showing breakdown of bailout programs for the FED, Treasury, FDIC, FHA
http://globaleconomicanalysis.blogspot.com/2008/11/bailout-pledges-hit-77-trillion.html

[BelgianMadCow]

45. Now there's a graphic worth a thousand words

especially if the words are mine.

Thanks, saving that.

[Roland99]

36. 300pt drop 12min in? Profit taking or bad news?

[Warpy]

37. My guess is more asset dumping to pay people cashing out

of everything from their 401K plans to fat hedge fund accounts.

As long as they can pay people cashing out, they can stay in business.

They're going to start to fail in huge numbers, though, and that's why I don't think we've seen the bottom yet.

[DemReadingDU]

38. Martin Weiss: America’s Second Great Depression

12/1/08 Starting Now: America’s Second Great Depression by Martin Weiss

On this first weekday after Thanksgiving, it’s time to take a moment, look at the changes swirling all around us and think about the tasks we must achieve together in the weeks ahead.

After more than six decades of growth, America is sinking into its Second Great Depression of modern times. The place is every home, business, and community. The time is now.

America’s Second Great Depression is not a typical 20th century recession that happens to strike a bit harder or linger somewhat longer. Nor is it merely a fictional scenario conjured up by economists with a murky crystal ball.

America’s Second Great Depression is the probable consequence of a great housing bust, a massive mortgage meltdown and the biggest financial crisis in history.

It promises to bring the worst wave of bankruptcies, job losses and wealth destruction any citizen under 90 has ever experienced.

It challenges the smartest minds in Washington, defies the deepest pockets on Wall Street and threatens to rip through our life with the force of a Cat-5 hurricane. And yet, among all those making the decisions that could forever change our future, no one has personal experience with a similar episode.

I don’t either. I was born in 1946, just as we were leaving the final vestiges of America’s First Great Depression behind. I’ve studied that historic period with books, charts and numbers, but that’s not the same thing. I’ve lived in Brazil and Japan during tough times, but that, too, was different.

What brings me closer to a visceral understanding of this crisis is the half century I shared with my father, J. Irving Weiss, one of the few economists who not only advised investors during the First Great Depression, but actually predicted it.
.
.
Most of all, he did not want to see America go through another depression ever again. His vision for accomplishing that goal, however, was different from that of most economists in the post-Depression era. Their strategy was to yank the economy out of nearly every slump and slumber, forever seeking to keep the economy growing, always bailing out major institutions that failed. His philosophy was moderation in both directions. “The only way to avoid the pain of a great bust,” he wrote, “is to refrain from the excesses of a great boom.”

I agree, and in the coming weeks, I’ll explain why. Plus, I’ll show you how you can use a similarly moderate approach to secure your own future.

lots more...
http://www.moneyandmarkets.com/starting-now-americas-second-great-depression-3-28428

[DemReadingDU]

39. Every Trick in the Book by Mike Whitney

12/1/08 Every Trick in the Book By Mike Whitney
This is the last half of the article...

REAGAN'S LEGACY

Our present dilemma can be traced back to the 1980s--the Reagan era--and the rise of an organized, industry-funded movement, which advanced their business-friendly, "trickle down" ideology which, when put into practice, has led to greater and greater income disparity, unprecedented expansion of credit and, ultimately, economic disaster.

The problem is the way that the system has been reworked to serve the interests of the investor class at the expense of working people. As Wall Street has tightened its grip on the political parties, more of the nation's wealth has gone to a smaller percentage of the population while the chasm between rich and poor has grown wider and wider. The United States now has the worst income and wealth disparity since 1929 and a whopping 75 percent of the labor force has seen a drop in their living standard since 1973. The average American has no savings and a pile of bills he is less and less able to pay. Apart from the ethical questions this raises, there is the purely practical matter of how a consumer-driven economy (GDP is 70% consumer spending in US) can maintain long-term growth when wages do not keep pace with productivity. It's simply impossible. The only way the economy can grow is if wages are augmented with personal debt; and that is exactly what has happened. The fake prosperity of the Bush and Clinton years can all be attributed to the unprecedented and destabilizing expansion of personal debt. Wages have been stagnate throughout.

It's clear that the architects of the present system knew what they were doing when they cooked up their supply side theory which postulates that everyone benefits when the rich get richer. Baloney. "All boats rise" is the familiar rallying cry. Of course, it was all nonsense as the current financial crisis proves. The creation of equity bubbles is just a clever means of social engineering, just like regressive taxation. It separates the wheat from the chaff, exacerbating dormant animosities between the classes. The Fed has skillfully aided its White House counterparts in creating the same divisions that existed during the Gilded Age, further fueling the animus towards workers. But now the massive debt bubble is crashing and threatens to bring down the whole system in heap. Bernanke and Paulson are frantically trying to plug the holes in the dam rather than rebuild on a solid foundation of fair pay for productivity.

It all gets down to wages, wages, wages. If wages don't grow, neither will the economy. Author Ravi Batra sums it up like this in his book "Greenspan's Fraud":

"A bubble economy is born when wages trail productivity for some time and result in ever-rising debt. Then profits grow faster than productivity gains, and share prices outpace GDP growth. However, a time comes when debt-growth slows down, and demand falls short of output, resulting in profit decline and a stock market crash. Thus, the very force that generates the stock market bubble seeds its crash." ("Greenspan's Fraud": Ravi Batra, Palgrave Macmillan, p 152)

Batra again: "The rising wage gap feeds profits on one side and debt on the other. A time comes when the debt binge slows. That is when the demand-supply imbalance, thus far masked by swelling debt and overinvestment, comes to the surface. That is when profit begins to fall, a the nation receives a sudden jolt. First, the stock market moves sideways. But as excess supply of goods continues, share prices begin to crash. (ibid: Ravi Batra, Palgrave Macmillan, p 153)

The "trickle down" Voodoo economic model was destined to fail because it was built on a fiction. Prosperity is not possible without the equitable distribution of wealth and fair worker compensation. As the financial crisis continues to ripple through the global economy through 2009 and 2010; the focus should be on creating a system that is sustainable, which means that the needs of workers should precede those of Wall Street.

http://www.informationclearinghouse.info/article21354.htm

[tclambert]

66. "A rising tide lifts all boats"

They used to say that a lot in the Reagan days, quoting something said during the Kennedy administration (when it worked). But the "trickle down" hypothesis is like lifting the boats with a crane and expecting that to make the tide come in. "I don't get it. We raised the boats. Especially the expensive ones. Why isn't the water rising?"

The "rising tide" is and always has been WAGES.

Workers are also customers. You want your customers to have more money, right? That means you have to pay workers more. No, no, you can't just cut the pay of your company's workers. If you do it, all the other businesses will, too. And that's your customer base, making less money, spending less, and not buying your widgets. Workers are customers.

[Roland99]

41. 11:01am - YOUCH!

DJIA 8,424.83 -404.21 -4.58%
Nasdaq 1,453.26 -82.31 -5.36%
S&P 500 847.89 -48.35 -5.39%
Global Dow 1,393.90 -72.44 -4.94%
Dow Util 367.05 -15.19 -3.97%
NYSE 5,273.62 -325.68 -5.82%
AMEX 1,275.97 -88.04 -6.45%
Russell 2000 447.06 -26.08 -5.51%
Semcond 188.58 -8.56 -4.32%
Gold future 777.50 -41.50 -5.07%
30-Year Bond 3.32% -0.16 -4.67%
10-Year Bond 2.82% -0.13 -4.50%

[Pale Blue Dot]

44. Does anyone have suggestions for good books about the Great Depression?

I think I may stop by the library tonight to pick up some light reading.

[DemReadingDU]

46. Some people on Denninger's recommended these

Check out these links...
http://www.tickerforum.org/cgi-ticker/akcs-www?post=59224

http://www.tickerforum.org/cgi-ticker/akcs-www?post=68716

http://www.tickerforum.org/cgi-ticker/akcs-www?post=70741

http://www.tickerforum.org/cgi-ticker/akcs-www?post=71011

[tclambert]

92. This year's Almanac?

[Cassius23]

47. Does anyone have any opinion on "Naked Economics"(or recommended econ 101 books)

by Charles Wheelan? I'm trying to get the basics of economics down and was wondering what people thought about it. I'm hoping to try to get some more baseline economic understanding and that seems like a good book.

Any other suggested titles?

[raccoon]

59. I just finished "Naked Economics." I recommend it; he did make some things clearer.

He is somewhat to the right, however.

[Zenlitened]

49. Confession is good for the soul: We are in a recession...

... and have been since December 2007.

Determination of the December 2007 Peak in Economic Activity

The Business Cycle Dating Committee of the National Bureau of Economic Research met by conference call on Friday, November 28. The committee maintains a chronology of the beginning and ending dates (months and quarters) of U.S. recessions. The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.

Full statement:
http://www.nber.org/dec2008.html

[Cassius23]

55. Is the site listed down for anyone else?

I'm showing that the page and the site are down.

[antigop]

50. antigop continues to question the practice of securities lending from pension funds

Background:

I previously posted information about this securities lending lawsuit:

http://www.chicagotribune.com/business/chi-sun-northernoct05,0,6946996.story

For 20 years, Chicago-based Northern Trust Corp. held the hand of the University of Washington, providing it the kind of steady, safe investment services that earned the bank its nickname "the Gray Lady of LaSalle Street."

But over the course of a few dramatic days in September, all that changed. The Wall Street financial disaster that took down such titans as Lehman Brothers Holdings Inc. and Washington Mutual Inc. also damaged Northern's relationship with the school, proving that even the most staid financial dealings have become vulnerable to the turmoil sweeping the country.

A suit filed in Seattle by UW describes the harrowing days following Lehman's collapse, when mounting losses in Northern's once-steady securities-lending business stunned the university and allegedly pushed Northern to seek the help of the Federal Reserve and U.S. Treasury Department. Those requests were rejected, the suit said.

The dispute came to light when UW filed suit Sept. 24, following the university's demand on Sept. 17 that it be allowed to withdraw its assets from the securities-lending program. That demand came two days after the Lehman bankruptcy, when Northern sent the university word that its investment in a fund tied to a supposedly low-risk program was suddenly hemorrhaging red ink.

I posted the above merely for background info because I have questions about this whole practice of securities lending.

Now here is some interesting information about securities lending that I stumbled across:
http://findarticles.com/p/articles/mi_hb5266/is_/ai_n20450010
Regulation: Government boosts securities lending; Pension funds to profit by expanded list of banks and broker-dealers eligible to play.
(You need a free subscription to read the entire article, but here is a snippet)

Recent changes in federal regulations and law are making it easier for retirement plans to lend securities to overseas banks and broker-dealers - and the government's moves could benefit plan bottom lines, industry officials said. The regulatory relief came in the form of an Oct. 30 announcement from the Department of Labor's Employee Benefits Security Administration that it had agreed to expand an ERISA prohibited-transaction class exemption that had previously limited plans to lending securities to U.S.-based banks and broker-dealers.

The above article was from the November, 2006 issue of Pensions and Investments.

So....
1) ERISA had a provision that limited lending securities from pension funds to U.S.-based banks and broker-dealers.
2) In 2006, the Department of Labor removed this restriction.

So
1)Why did ERISA put in the original restriction?
2) Why did the Department of Labor take the restriction out in in 2006?

antigop continues to ask, "What are they REALLY doing with our pension funds -- including both defined benefit and 401(k)'s?"

[DemReadingDU]

109. thanks for this info, catching up from yesterday

Good questions, we will probably find the answers when our pensions/401Ks/IRAs have vanished

:(

[TrogL]

51. Loonie Watch

Highlights

Current:

Loonie: Toronto Stock Exchange:

30-day and 90-day vs.greenback:



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




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

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

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

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

2008-10-20 Monday, October 20 0.834934 USD
2008-10-21 Tuesday, October 21 0.819135 USD
2008-10-22 Wednesday, October 22 0.800256 USD
2008-10-23 Thursday, October 23 0.795355 USD
2008-10-24 Friday, October 24 0.785238 USD
2008-10-27 Monday, October 27 0.773096 USD
2008-10-28 Tuesday, October 28 0.772678 USD
2008-10-29 Wednesday, October 29 0.812876 USD
2008-10-30 Thursday, October 30 0.817728 USD
2008-10-31 Friday, October 31 0.817728 USD
2008-11-03 Monday, November 3 0.842744 USD
2008-11-04 Tuesday, November 4 0.869414 USD
2008-11-05 Wednesday, November 5 0.862813 USD
2008-11-06 Thursday, November 6 0.84631 USD
2008-11-07 Friday, November 7 0.845309 USD
2008-11-10 Monday, November 10 0.83696 USD
2008-11-11 Tuesday, November 11 0.83696 USD
2008-11-12 Wednesday, November 12 0.813273 USD
2008-11-13 Thursday, November 13 0.812282 USD
2008-11-14 Friday, November 14 0.816927 USD
2008-11-17 Monday, November 17 0.8188 USD
2008-11-18 Tuesday, November 18 0.817194 USD
2008-11-19 Wednesday, November 19 0.808407 USD
2008-11-20 Thursday, November 20 0.77821 USD
2008-11-21 Friday, November 21 0.778271 USD
2008-11-24 Monday, November 24 0.816593 USD
2008-11-25 Tuesday, November 25 0.818733 USD
2008-11-26 Wednesday, November 26 0.810504 USD
2008-11-27 Thursday, November 27 0.810504 USD
2008-11-28 Friday, November 28 0.809061 USD

Current values

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

Market            Open   High    Low   Last  Change    Pct Time
CD.Y$$ Cash     0.8024 0.8088 0.8024 0.8083 +0.0007 +0.09% 12:02 
CD.Z08 Dec 2008 0.8012 0.8080 0.8012 0.8080 +0.0019 +0.24% 11:09 
CD.H09 Mar 2009 0.8030 0.8090 0.8030 0.8090 +0.0011 +0.14% 11:59 
CD.M09 Jun 2009 0.7805 0.7806        0.8089 -0.0056 -0.69% set 13:11 
CD.U09 Sep 2009 0.9350        0.9340 0.8122 -0.0037 -0.46% set 13:11 
CD.Z09 Dec 2009 0.7000 0.7000 0.7000 0.8127 -0.0037 -0.46% set 13:11 
CD.H10 Mar 2010 0.8800 0.8800 0.8800 0.8132 -0.0037 -0.45% set 13:11 
 

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

Market          Open    High    Low     Last    Change   Pct 
AUSTRALIAN $/CANADIAN $ (CME:ACD)
ACD.Z08 Dec 2008 0.8132 0.8132 0.8132 0.8132 +0.0116 +1.43%   
BRITISH POUND/US$ (SMALL) (NYBOT:MP)
MP.Z08.E Dec 2008 (E) 1.4955 1.4976 1.4814 1.4814 -0.0580 -3.77%   
EURO/BRITISH POUND (NYBOT:GB)
GB.Z08.E Dec 2008 (E) 0.83950 0.83950 0.82400 0.82395 -0.01285 -1.56%    
EURO/JAPANESE YEN (NYBOT:EJ)
EJ.Z08.E Dec 2008 (E) 120.800 120.800 118.700 118.700 -2.495 -2.05%      
EURO/US$ (SMALL) (NYBOT:EO)
EO.Z08.E Dec 2008 (E) 1.25850 1.26400 1.25850 1.26360 -0.00475 -0.37%   

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

The March Canadian Dollar was lower overnight as it consolidates some of its recent short covering rally. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 81.82 are needed to confirm that a short-term low has been posted. Closes below November's low crossing at 77.00 would renew this fall's decline while opening the door for additional weakness into early- December. First resistance is the 20-day moving average crossing at 81.82. Second resistance is last Tuesday's high crossing at 82.54. First support is the 10-day moving average crossing at 80.28. Second support is November's low crossing at 77.00.

Analysis

The thing to watch today is actually the TSE. I listened to the morning drive-in and they said it had dropped 700 points after opening. Seems to be a day for car-wrecks. Saw two of them on the way in, one fairly bad.

The housing market is also taking a tumble. They were reporting on a guy in Toronto who owns three properties. Last month he had 4 showings a day on one of his condos. Now he's willing to dump it at a loss and he's got no takers.

[tclambert]

67. Secondary loony watch: Sarah Palin campaigning on behalf of Saxby Chambliss

Sorry. Couldn't resist.

[PassingFair]

80. We had guests from Fort McMurray here over the weekend...

throwing money around like it was nothin'...

I hadn't checked the exchange rate for you folks from the
"south" (I'm in Detroit...)in a couple of months....

Jeez...I hadn't realized that our dollar was such
worthless *hit.

:scared:

[TrogL]

86. If they're working in Ft. McMurray they're making a hell of a lot more than I am

Salaries are a fortune there and there's nothing to spend it on. There's a huge housing crisis with people sleeping in cars and stacked like cordwood in hotel rooms.

My daughter's boyfriend works there and bought two brand-new trucks last year.

[PassingFair]

87. Yep. These were young girls who live with their parents...

no rent, big paychecks!

They love to travel, and were planning upcoming
trips to Thailand and Brazil! They just got back
from Europe.

Jeez, I wish I was 19 again!

[Roland99]

57. 1:05pm - No lunchtime help. Over half of last weeks' gains are gone.

DJIA 8,383.17 -445.87 -5.05%
Nasdaq 1,441.22 -94.35 -6.14%
S&P 500 842.18 -54.06 -6.03%
Global Dow 1,391.85 -74.49 -5.08%
Dow Util 365.97 -16.27 -4.26%
NYSE 5,246.33 -352.97 -6.30%
AMEX 1,260.83 -103.18 -7.56%
Russell 2000 440.43 -32.71 -6.91%
Semcond 186.97 -11.27 -5.69%
Gold future 775.00 -44.00 -5.37%
30-Year Bond 3.34% -0.15 -4.22%
10-Year Bond 2.83% -0.13 -4.43%

[specimenfred1984]

58. A year later, "economists" say the evil propaganda word "recession", LOL

Our culture is so fucking stupid.

[Dr.Phool]

60. I never would have known it if they didn't tell me.

:sarcasm:

[tclambert]

68. It's a sign Bush is losing his power.

In his heyday, the decider would never have allowed the "R" word to be uttered. They'd have to come up with another term, like "economic re-adjustment." No wait. That has an "R" in it, too.

[specimenfred1984]

61. 2 reasons why I did not post anything about last weeks "rally" being a fraud

1: It was obvious to anyone who cares as volume was low and therefore easy to manipulate/prop the markets.
2: 99% of the U.S. population are dumbed-down to the point of no return, they aren't even capable of hearing the truth.

Did anyone, anywhere other than DU, mention that last week's "rally" was a fraudulent and manipulated piece of shit? I didn't read it or watch it anywhere.

[AnneD]

63. I think we have become so jaded as to the numbers....

I confess I was more interested in visiting my daughter in California than watching the market......like how you can have a game on the tv and everyone is chattering and you think no one is paying attention until a game changing play happens then everyone shuts up at once. I think folks were more interested in whom Obama picked for his economic team than market activity.

Say-are we having a Santa Rally this year?

[specimenfred1984]

65. I think a "rally" is likely as markets will thin out towards xmas

making it easier to manipulate. The markets may just dead drift/fascist float like they've been doing since 10:30 this morning for the entire month of Dec..

[tclambert]

69. Personally, I won't consider it a rally until the DJIA passes 10,578

[Tansy_Gold]

72. I'm not looking for that to happen anytime this century.

There's not enough peasants' loot left to, um, loot.


:-(



Tansy Gold, peasant and proud!

[Roland99]

71. There was one day with good volume but last week's gains are 2/3 gone now

And sliding down fast.

[BelgianMadCow]

83. people should read up on sucker rallies

I on the other side have to find out the roots of "Ponzi scheme".

[BelgianMadCow]

84. Tip for SMW readers: check the WE thread as well !

I did for the first time and there you go, a bookmark :-)

:thumbsup: to the contributors!

[FriendlyReminder]

70. OMG! Jan. 20th can't come soon enough

[CatholicEdHead]

73. Nice big drop again the last hour

After being around -450 all day it goes below -600 and is still there with 7min to go.

[Mojorabbit]

74. Down

8,219.58 -609.46 -6.90% @ 3:52\
Yikes

[JNelson6563]

75. My god! Run for your lives!

I can't even see any of you because of the blood spurting everywhere! This is really, really ugly shit.

Just popping in to let out a primal scream. Hope all you Marketeers are well positioned to weather the storm.

Julie

[PassingFair]

81. IS there a "good position" here?

[JNelson6563]

93. For that picture? I'd say Michigan is prolly safe. haha

But for the economic picture, I have long advocated for tangibles that have stood the test of time such as gold and precious/semi-precious gems. That way when our new Chinese overlords show up you can either flee the country with them sewn into your clothes or bribe the new overlords.

Cheers,
Julie--always thinking ahead :-)

[tclambert]

96. Is that Chicago? Holy crap, it is.

So is the wave coming from Lake Michigan? Or is it from the Atlantic and has overwashed everything to the east?

[PassingFair]

101. Economic Tsunami...

It's taking out everything!

[Roland99]

76. I think it's finished settling....

DJIA 8,149.09 -679.95 -7.70%
Nasdaq 1,398.07 -137.50 -8.95%
S&P 500 816.19 -80.05 -8.93%
Global Dow 1,374.80 -91.54 -6.24%
Dow Util 358.02 -24.22 -6.34%
NYSE 5,092.41 -506.89 -9.05%
AMEX 1,228.55 -135.46 -9.93%
Russell 2000 417.15 -55.99 -11.83%
Semcond 183.21 -12.14 -6.12%
Gold future 776.80 -42.20 -5.15%
Oil $49.22 -5.15
30-Year Bond 3.24% -0.25 -7.20%
10-Year Bond 2.72% -0.24 -8.05%


Russell 2000 really got taken to the woodshed.

[CatholicEdHead]

77. What a mess

Close below 8000 tomorrow?

[DemWynner]

85. I am surprised

That there were not more posts to this today. The day the DOW went down over 400, there was need for 2. I think people are resigned to what is happening. I lost a bunch today and am really afraid of what is coming in the future. I hope things pick up. I am thinking of getting a part time job just to have more spending money and save for retirement. I hope it does not go down much more, but with the dollar gaining strength, I think we will hit the 7500 mark again.

[DemReadingDU]

110. Welcome to our daily SMW threads

You will learn a lot here, stop back again!

[ozymandius]

90. Here's some blather with those fugly numbers.

Per the bold typed item: How does this work? Does Treasury print money to purchase T-notes? Is this inane notion anywhere near the mark?

4:30 pm: A sharp sell-off in the stock market Monday snapped a five-session winning streak as inventors digested a weak manufacturing survey, the possibility that the Federal Reserve may buy longer-term Treasuries, word that the U.S. economy officially entered recession in December 2007 and concerns regarding financials.

The S&P 500 dropped 8.9%, settling near its lows following a late session surge surge in selling interest. Volume was slightly above the year-to-date average. The decline was broad-based, with 498 of the components within the S&P 500 posting a decline.

The financial sector (-17.0%) got hit the hardest. Oppenheimer analyst Meredith Whitney said the U.S. credit card industry may cut credit lines by well over $2 trillion, or 45%, over the next 18 months, citing risk aversion, funding challenges and regulatory and accounting changes. Whitney's opinion is well respected after she correctly predicted much of the turmoil on Wall Street.

Weakness in commodities (-3.6%), with oil dropping 9.5%, weighed on the energy (-10.3%) and material sectors (-9.8%).

In economic news, Federal Reserve Chairman Ben Bernanke said the U.S. economy remains under stress despite the efforts of the Fed and other Policy makers. To help alleviate the stress, he laid out possible further policy actions, including lowering the fed funds rate, purchasing longer-term Treasuries or agency securities on the open market.

The latter comment, along with a flight-to-safety bid, sparked a rally in Treasuries, with yields of both the 10-year note and 30-year bond dropping too record lows. The 10-year note rose 48 ticks to yield only 2.75% and the 30-year bond rose more than four points to yield 3.23%.

The November ISM Index, a national manufacturing survey, declined to 36.2 from the October reading of 38.9. This was worse than the consensus estimate of 37.0 and, represents the most contraction in U.S. manufacturing since 1982. The survey shows continued signs of dropping prices, with the ISM Prices Paid Index declining to 25.5 from October's reading of 37.0. The industrials sector dropped 8.5%.

The National Bureau of Economic Research announced that December 2007 marks the end of a 73 month expansion in the U.S. economy and the beginning of a recession. Assuming the U.S. is still in a recession, the duration of decline the peak to trough decline will surpass the recessions of 2001 (8 months) and 1990/1991 (8 months), marking the longest recession since 1981/1982 (16 months).

Black Friday sales were better-than-feared. Depending on the research firm, sales were up between 2% and 7% year-over-year. However, there are concerns that the sales came at the expense of steep discounts and buying has since tapered off. Retailer stocks dropped 9.3%.

In the end, the S&P 500's decline of 80 points erased nearly all of last week's 96 point gain. The index is up 10.2% from its multi-year low reached on Nov. 21, and down 44.4% this year.DJ30 -679.95 NASDAQ -137.50 NQ100 -8.0% R2K -11.9% SP400 -10.9% SP500 -80.03 NASDAQ Dec/Adv/Vol 2353/416/1.95 bln NYSE Dec/Adv/Vol 2809/356/1.63 bln

[Roland99]

78. Schwarzenegger declares fiscal emergency in Calif.: report

Schwarzenegger declares fiscal emergency in Calif.: report
http://www.marketwatch.com/news/story/Schwarzenegger-declares-fiscal-emergency-Calif/story.aspx?guid=%7B8B33679E%2D762E%2D418A%2DB131%2D385F34F77FD7%7D&dist=hplatest

SAN FRANCISCO (MarketWatch) -- Gov. Arnold Schwarzenegger on Monday declared a fiscal emergency and called for a special session with lawmakers to address California's $11.2 billion deficit, the Associated Press reported. California's revenue gap is expected to reach $28 billion over the next 19 months and without immediate action, the state could run out of cash in February, the news agency said. The emergency declaration allows the governor and lawmakers to change the existing budget within the next 45 days, the AP said.

[BelgianMadCow]

82. oh COME ON 8 trillion so far, this 11 billion is a peanut no-brainer nt

[TheWatcher]

88. As expected, last week has been exposed for the synthetic, fabricated, manipulated Bullshit it was.

TPTB got their Happy Jam to get the Sheep lubed up for Holiday Shopping, and end of Fiscal year Propping for their funds that needed tending to. For those who didn't buy into last week's rally, of course it wasn't real. By now everyone should realize this is more of a Rigged Casino than a Market.

Now with the easy money having done it's job, it's kind of hard to say where it goes from here. There is no "Good News" coming out this week, and even the fake economic numbers the Government releases will not be good enough to cover another Meth party to make it believable (Not that the Sheep won't buy it anyway. Remember, it's more imprtant to feel good than to think.)

We either retest the lows from last week, or Da Boys will try to stuff our stockings with a fake Santa Claus Rally.

There really isn't much left about this Market that's even real, so one is kind of reduced to watching the fake news, fake rumor mill, and trading floor chatter to try and get a sense of what may be coming next. It's all psychology driven at this point.

The system is insolvent, bankrupt, and collapsed.

What matters now is keeping the illusion alive as long as possible.

And somehow managing the decline to 6400 as controlled as possible.

The Futures have already been jammed about 200 points from the close after dropping off a cliff initially, so it appears the Official Sector has the Reindeer revved up and ready to go.

The only question is will it be Coal or Candy Canes.

Stay Tuned for tomorrow's next exciting episode of Other People's Money Casino Royale.

On Edit: The latest Buzz today is that Helo Ben may be considering Zero Rates at this point. Surprised? Not. I kind of figured they were going to have to pull the Weimar/Zimbabwe lever pretty soon, and that action and the Fed directly buying treasuries would be a signal. Think they won't do it?

Just read Bernanke's Magnum Opus Deflation: Making Sure It Doesn't Happen Here. it will tell you all you need to know. And all you want to ignore.

[Tansy_Gold]

89. Gee, do I detect a note of bitterness in that post?

If not, you can have some of mine!

:hi:


Tansy Gold, notably bitter

[TheWatcher]

91. You Do, dear Tansy, you do.

I think our combined bitterness could make ear wax taste like Godiva Chocolate. :)

By the way, read what I wrote on Edit. Zero Rates. Think about that. This just keeps getting more, and more insane.

[tclambert]

95. He has a study team trying to figure out how to go to negative rates.

And another team genetically modifying geese to lay golden eggs.

And another team searching for magic beans.

And another team designing spinning wheels that will turn flax into gold.

And another team hunting leprechauns.

(This could go on a while.)

[Tansy_Gold]

97. Re It Can't Happen Here

I have a copy of the Sinclair Lewis novel on the headboard bookcase but haven't somehow found time to read it. BF did and said it's. . . . remarkable.

It can happen here. It can happen anywhere.

[UpInArms]

98. I do believe it's time to bone on on "zombie banks"

and I think someone needs to hold my hair

Japan's Zombie Economy - Not Buying But Browsing

The giant inflatable Santa hovering in the atrium of Daiei's main store in Shin Urayasu strikes a cheerful note on a gloomy Tokyo evening. For the struggling retailer, this year's Christmas sales are more than usually important; but tonight the few shoppers appear to be doing more browsing than buying.

Daiei is one of the "zombie" companies, the walking dead which stalk Japan's corporate landscape 10 years after the bubble economy burst. Kept alive by the banks who fear that if they allow the firms to fail the true extent of Japan's bad loans problem will be revealed, the zombies have come to symbolise the troubles of the world's second largest economy.

Last month the government threw Daiei a financial lifeline, backing a ¥60bn (£300m) bailout package from its three main lenders with a loan from the state-owned Development Bank of Japan. But by keeping the debt burdened retailer going, the government has handed more ammunition to its critics who argue that it does not have the stomach for the radical measures necessary to rescue the country from its decade-long slump.

The prime minister, Junichiro Koizumi, came to power 20 months ago promising to shake up Japan's cosy post-war consensus with the slogan "no pain, no gain". Observers are starting to wonder if Mr Koizumi, despite the Thatcherite rhetoric, is any more capable than his predecessors of tackling the interconnected problems of debt and deflation weighing down the economy.

Japan is in a strange topsy-turvy world where the normal rules of economics do not work. Prices started falling three years ago and, with interest rates now at zero, the Bank of Japan cannot cut borrowing costs to cheer up consumers and companies.

Deflation is adding to the woes of the zombie companies like Daiei. The equivalent of an economy-wide dose of negative equity, falling prices make it harder for firms to service their debts. Bad loans total ¥52 trillion, according to the government's latest estimate, around 10% of GDP. Many analysts believe this figure is too conservative and that the real figure could be two or three times greater.

[Tansy_Gold]

99. Shadow government, shadow banking system, why not zombie inc's?

Makes perfect sense to me. :sarcasm:

[specimenfred1984]

105. Even "Wonkette" is laughing its ass off over the lying financial asshats:

--- Your Dow Jones Falls Many Points After Investors Discover Some ‘Recession’ Thing

The Dow Jones fell 679 points today, since it’s been a full six days since Paulson last introduced a new multi-hundred billion dollar loan or loan guarantee program, and everyone on Wall Street is a child: “The day’s news reminded investors, who last week were buying on a burst of optimism, that the economy is still in serious trouble. And at midday, Wall Street had confirmation of what everyone has suspected for months, that the nation is indeed in a recession.” They just wanted to be sure, for the 80th time, that the economy was indeed contracting, and then it was SELL SELL SELL.

Also, Hank Paulson “says the administration is looking at other ways to utilize the rescue package, including alternatives for providing capital to financial institutions.” Jesus, this guy. JUST REFINANCE CRAPPY MORTGAGES ALREADY. Next week he will use his TARP authority to rethink capitalism in general, and the following week, the concept that humans should organize into societies. Finally. ---

http://wonkette.com/404662/your-dow-jones-falls-many-points-after-investors-discover-some-recession-thing

[Demeter]

102. Pretty Impressive, People

My computer goes on the fritz, it slushes all day, I go back to a full day of work and nearly die of coughing, and what do you guys do?

Crash the economy into a year-long running recession.

Can't turn my back on you for a second.

Let me get the mop out.

[Dr.Phool]

104. Hey! Don't blame me!

I've been out all day.

Somebody sure made a mess.

[Tansy_Gold]

106. Oh, hell, it's my fault. I get blamed for everything anyway,

might as well take the rap for this too.


:-(


Tansy Gold, who feels guilty even when she isn't (It's my up-bringing.....)

[dweller]

107. after reading this whole thread of the market woe

i'm thinking of investing in eggs... they've been mentioned several times above, golden eggs, counting eggs... may be as good if not better than $$.

get some laying hens and start raising up a crop of eggs. Sell some, give some away to the hungry, let a bunch incubate, get more chickens to lay more eggs. (mulch byproduct=fertilizer)

you can't eat money.
dp

[Wednesdays]

108. Asian stocks are in meltdown mode

So what else is new? Hang Seng and Nikkei down 5%.