STOCK MARKET WATCH, Thursday April 30

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday April 30, 2009

Bush Administration Officials Under Indictment = 2
Financial Sector Officials Under Indictment = 0
Financial Sector Officials In Prison = 2

AT THE CLOSING BELL ON April 29, 2009

Dow... 8,185.73 +168.78 (+2.06%)
Nasdaq... 1,711.94 +38.13 (+2.28%)
S&P 500... 873.64 +18.48 (+2.16%)
Gold future... 900.50 +6.90 (+0.77%)
30-Year Bond 4.03% +0.07 (+1.80%)
10-Yr Bond... 3.10% +0.09 (+3.13%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie and Silver

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Read more: du

[ozymandius]

1. Market Observation

Another Look at the Inflation/Deflation Debate
by Chris Puplava

Inflation/Deflation

Over the next decade, the critical element in any investment portfolio will be the correct call regarding inflation or its antipode, deflation. Despite near term deflation risks, the overwhelming consensus view is that “sooner or later” inflation will inevitably return, probably with great momentum. This inflationist view of the world seems to rely on two general propositions. First, the unprecedented increases in the Fed’s balance sheet are, by definition, inflationary. The Fed has to print money to restore health to the economy, but ultimately this process will result in a substantially higher general price level. Second, an unparalleled surge in federal government spending and massive deficits will stimulate economic activity. This will serve to reinforce the reflationary efforts of the Fed and lead to inflation.

These propositions are intuitively attractive. However, they are beguiling and do not stand the test of history or economic theory. As a consequence, betting on inflation as a portfolio strategy will be as bad a bet in the next decade as it has been over the disinflationary period of the past twenty years when Treasury bonds produced a higher total return than common stocks.

Van R. Hoisington, Lacy H. Hunt, Ph.D.
Hoisington Investment Management Company
Quarterly Review and Outlook: First Quarter 2009

As stated above, the two most prominent causes for future inflation held by inflationists are an expanding Fed balance sheet and swooning fiscal deficits. Two of the most prominently held deflation arguments are spare capacity in terms of manufacturing and in labor. Today’s article does not rehash the two inflationary arguments but instead presents two new inflationary concerns indirectly by addressing the two deflationary arguments. For the context of this article, inflation and deflation are defined by price levels and not money supply levels.

....

How could capacity utilization increase while at the same time the economy was shedding manufacturing jobs? One word, globalization. We exported our manufacturing capacity overseas as companies reduced costs and increased profit margins. If company XYZ had ten factories going into the 2000 recession and was using eight of them at full capacity and two were idle, its utilization rate would be 80%. However, if company XYZ decides to permanently close five factories and then buy the lost input capacity from five overseas factories that can produce at a cheaper cost and has one of its five remaining factories idle, its manufacturing utilization rate is still 80%, though it is now receiving 60% of its inputs from overseas when before it made 100% of its inputs domestically. This is what happened in the last recession and is likely to happen in this downturn as U.S. companies shift from making their inputs domestically to buying their inputs from foreign factories that can produce at cheaper costs due to their abundance of cheap labor.

his last decade truly saw a major exportation of U.S. manufacturing jobs overseas not only in durable goods manufacturing employment but also in non-durable goods manufacturing, which had been stable in the prior three decades. You can see this in the figure below which shows a dramatic decline in both durable and non-durable goods manufacturing employment after the 2001 recession (red line below). When looking at the various non-durable goods industries, two industries that showed dramatic declines were textile mills and apparel. Both industries were shedding employment at more than a 15% YOY decline rate, with neither industry’s employment growth rate rising above -5% in the prior expansion. All one has to do is look at their shirts, shoes, pants, socks, underwear, hat, etcetera, and you will find the product was manufactured in China, Taiwan, Thailand, Mexico, or some other foreign country.

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

[Demeter]

18. And That Is Why There Will Be No Recovery Of Any Kind

Anywhere. Unless and until globalization (beggar thy neighbor) ends, and building one's own national economy begins (jobs, infrasructure, tax base), nobody is going to be buying or selling anything.

The only reason we aren't starving to death right now is this is a fertile land and agribusiness doesn't own it all.

[Hugin]

21. Resource disparity has been what always feeds the sharks...

Oil... Food... Water...

and right now it's the resource of Cheap Labor that's being played.

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

Making a few very very rich at the expense of the majority.

It won't stop until it evens out... Either when the whole world is living at the highest standard of living (Muwhahaha! I make myself laugh.) or at the lowest common denominator... Which is currently slave labor.

[DemReadingDU]

26. It won't stop until it evens out

and that is going to take a very long time. The elites are going to want to keep their status quo for as long as they can, to whatever extent they can.

[Demeter]

31. The "Elites" (I prefer Pirates) Are Standing on a Pyramid that Is Melting

Instead of building up that pyramid, they are destroying it. Hence, they have no right to stand there in the place of honor and power.

[Hugin]

34. Exactly...

The plan is always to boil the frog slowly.

However, due to circumstances beyond TPTB's control their scheme has hit a glitch... Did the masses wake up? Exposure due to too many damned sloppy players jumping in the game? Were transportation costs crimping their system? and they had to accelerate their attempts at owning everything.

I suspect their ill-informed expectations of 20% returns (no natural system with 20% growth is sustainable) is what will lead to the end of this particular effort. They should read a book sometime.

[burf]

42. I fear corporate agriculture

will use the flu pandemic as a tool to strengthen their position. Their willing accomplices in the government and media then make "food safety" programs such as National Animal Identification System mandatory and further reduce the number of small farms. All done under the guise of food safety and protecting public health.

[Demeter]

49. Corporate Agriculture Is the Petri Dish for Pandemic

Hog factory farm outside Mexico City blamed for this new swine flu.
Chicken and turkey factory farms breeding grounds for all bird flu outbreaks.

Just need to get the word circulating, and agribusiness will be trying desperately to clean up its act or cover its ass.

[Dr.Phool]

64. Start by calling it by it's real name. The Smithfield Flu.

[ozymandius]

2. Today's Reports

08:30 Initial Claims 04/25
Briefing.com 640K
Consensus 645K
Prior 640K

08:30 Personal Income Mar
Briefing.com -0.2%
Consensus -0.2%
Prior -0.2%

08:30 Personal Spending Mar
Briefing.com -0.2%
Consensus -0.1%
Prior 0.2%

08:30 Employment Cost Index Q1
Briefing.com 0.5%
Consensus 0.5%
Prior 0.5%

09:45 Chicago PMI Apr
Briefing.com 34.0
Consensus 34.0
Prior 31.4

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

[UpInArms]

44. Initial Claims @ 631,000 - last wk rev'd up 5,000

01. U.S. weekly jobless claims down 14,000 to 631,000
8:30 AM ET, Apr 30, 2009

02. U.S. jobless claims at lowest level since April 11
8:30 AM ET, Apr 30, 2009

03. U.S. Q1 employment cost index up record low 0.3%
8:30 AM ET, Apr 30, 2009

04. U.S. continuing claims up 133,000 to 6.27 mln
8:30 AM ET, Apr 30, 2009

05. U.S. March real consumer spending down 0.2%
8:30 AM ET, Apr 30, 2009

06. U.S. March real disposable incomes flat
8:30 AM ET, Apr 30, 2009

07. U.S. March nominal spending down 0.2%
8:30 AM ET, Apr 30, 2009

08. U.S. March nominal incomes down 0.3%
8:30 AM ET, Apr 30, 2009

09. U.S. March core inflation up 0.2%
8:30 AM ET, Apr 30, 2009

10. U.S. March savings rate 4.2% vs. 4% in Feb.
8:30 AM ET, Apr 30, 2009

[Dr.Phool]

63. WOW!!! New claims down to the lowest level since April 11th.

That's what? Three whole weeks? WE'RE SAVED!!!!!!

Wait until the shit really hits the fan in the next couple of weeks with automakers ans suppliers. I know that next week, a steel mill in Cleveland will be completely shut down.

Wait until they see the numbers by the end of May.

[Pale Blue Dot]

105. I saw that too.

They're so transparent now it's almost comical.

[UpInArms]

107. U.S. April Chicago PMI rises to 40.1% from 31.4%

46. U.S. April Chicago PMI rises to 40.1% from 31.4%
9:46 AM ET, Apr 30, 2009

[ozymandius]

3. Oil jumps above $51 on optimism recession slowing

SINGAPORE – Oil rose above $51 a barrel Thursday in Asia as investors took heart from optimistic comments from the U.S. Federal Reserve that the worst recession in decades is likely easing.

Benchmark crude for June delivery was up 52 cents to $51.49 a barrel by midday in Singapore, in electronic trading on the New York Mercantile Exchange. The contract Wednesday gained $1.05 to settle at $50.97.

Investors have brushed off recent dismal news — such as an annualized 6.1 percent contraction of U.S. gross domestic product in the first quarter — and pointed to so-called "green shoots," positive signs that the economy may be turning around.

....

The Energy Information Administration reported Wednesday that oil inventories jumped by 4.1 million barrels for the week ended April 24, more than twice what was expected by analysts, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

....

In other Nymex trading, gasoline for May delivery was steady at $1.44 a gallon and heating oil was steady at $1.33 a gallon. Natural gas for June delivery fell 5.5 cents to $3.35 per 1,000 cubic feet.

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

[radfringe]

45. yeah, that'll help slow down the recession

hike the oil/gas/fuel prices, choke household/business budgets even more...

yeah...that's the ticket...

...idiots

[ozymandius]

4. BofA's Lewis ousted as board chairman, stays as CEO

CHARLOTTE, North Carolina (Reuters) – Bank of America Corp (BAC.N) shareholders voted to oust embattled Chief Executive Kenneth Lewis as chairman of the board on Wednesday in what could be a precursor to his eventual replacement as CEO as well.

The bank's board "unanimously" expressed support for Lewis to stay in the CEO post despite the fact that shareholders "narrowly" approved a proposal to require an independent chairman.

Lewis, who will remain chief executive, will be replaced in the chairman post by Walter Massey, 71, a director of the bank's board since 1998 and also a director of McDonald's (MCD.N).

http://news.yahoo.com/s/nm/20090430/bs_nm/us_bankofamerica

[ozymandius]

5. Chrysler talks seen on the rocks as deadline looms

DETROIT/WASHINGTON (Reuters) – Chrysler rushed to clinch deals with Fiat SpA and a fractious group of lenders on Wednesday in a last-ditch effort to avoid bankruptcy ahead of a government-imposed April 30 restructuring deadline.

....

That leaves the focus on ongoing debt restructuring talks spearheaded by the Obama administration's autos task force and former investment banker Steve Rattner.

In a bid to win over three fund management firms that had spurned an offer to accept $2 billion in cash in exchange for writing off all of Chrysler's $6.9 billion in secured debt, U.S. officials sweetened the terms by throwing in another $250 million, people involved in those discussions said.

....

About 45 financial institutions hold Chrysler's secured debt. Failure to win their support on debt forgiveness would send the automaker into bankruptcy, officials have said.

http://news.yahoo.com/s/nm/20090430/bs_nm/us_autos

[Demeter]

38. Chrysler’s lenders agree (to) concessions

http://www.ft.com/cms/s/0/8f8b2730-3406-11de-9eea-00144feabdc0.html

The Obama administration on Tuesday extracted deep concessions from holders of Chrysler’s $6.9bn debt, buying time for the troubled US carmarker to agree a survival plan.

The four principal lenders, which hold about 70 per cent of the debt, agreed in principle that it should be swapped for $2bn in cash, paving the way for a heavily restructured Chrysler, part-owned by Fiat, the Italian carmaker.

Two Fiat executives told the Financial Times on Tuesday that they expected the Italian carmaker to sign a partnership with Chrysler on April 30, the deadline from the administration’s auto task force to strike a restructuring deal with the United Auto Workers union and creditors and agree an alliance with Fiat. A separate person familiar with the talks said he was “cautiously optimistic” that a deal would be concluded with Fiat.

But a “surgical” bankruptcy remains an option for the company, with the aim of forcing agreement from any smaller banks and hedge funds resistant to the debt alleviation, which was agreed with JPMorgan Chase, Goldman Sachs, Morgan Stanley and Citigroup. Bankruptcy could also be used to shed other liabilities, such as cutting dealer networks.

The four main banks, which have accepted government money under the troubled assets relief programme, had been coming under political pressure to cut significantly the carmaker’s debt pile. They agreed to accept 29 cents on the dollar – more than their debt was trading for in the market, but less than some had been demanding. They would also receive cash rather than securities, which added to the deal’s appeal.

”The agreement from Chrysler’s principal banks is an exceptional accomplishment in line with the president’s firm commitment that all stakeholders sacrifice to make this deal succeed,” said an administration official.

A majority equity stake in Chrysler would be held by the UAW and a separate employee healthcare trust. Fiat would own up to 35 per cent of the company, with the US government potentially owning a minority stake, according to a union document sent to workers.

Chrysler Financial, which provides loans to car dealers and buyers, is now the “biggest remaining hurdle” to a final settlement, according to one person familiar with the talks. The financing arm, which is separate from Chrysler but like the carmaker counts Cerberus Capital Management as a shareholder, has suffered from the liquidity crisis affecting all banks.

Talks between Cerberus, Chrysler and the government about how to structure a viable Chrysler Financial have been occurring separately but simultaneously.

While the task force’s first order of concern has been establishing that Chrysler will remain in existence, all of the parties have understood that the next immediate issue will be bringing the financing arm back to health or finding alternative credit for Chrysler’s dealers and car buyers.

Cerberus’ involvement as an owner of both Chrysler and Chrysler Financial has been a cause for concern to some people involved in the talks, who feel Cerberus has been acting in the interests of Chrysler Financial and, at times, to the detriment of Chrysler.

One person said that the Treasury and the Federal Reserve have been ”engaged at the highest levels” in talks about Chrysler Financial. ”The government has the ability to fix Chrysler Financial itself in many respects, it’s just a matter of cost and practicality,” the person said...MORE

[Ghost Dog]

41. Sergio Marchione is no fool,

as far as I can see. I've been watching him (SGS, for example) for a good few years now.

Just my humble grain of salt.

[tclambert]

54. Bankruptcy looms for Chrysler after talks fail - Detroit Free Press

By Justin Hyde • Free Press Washington Staff • April 30, 2009

http://www.freep.com/article/20090430/BUSINESS01/90430008/Chrysler+heads+to+bankruptcy+after+debt+talks+fail

WASHINGTON – The Obama administration will will announce at noon today that it will take Chrysler LLC into a historic bankruptcy to force a cut in debt key to a partnership with Fiat S.p.A. after three firms refused a sweetened offer.
With the UAW late Wednesday ratifying cost cuts in its contract and cuts in the money due its retiree health-care trust fund, President Barack Obama will announce a Chrysler-Fiat deal and the government’s “surgical” bankruptcy plan later today. The administration "was willing to give the holdout creditors a final opportunity to do the right thing," an administration official said. But "the agreement of all other key stakeholders ensured that no hedge fund could have a veto over Chrysler's future success."

The lack of an agreement will not "impede the new opportunity Chrysler now has to restructure and emerge stronger going forward," the official said. The administration has gone to great lengths to portray the first bankruptcy of one of Detroit’s major automakers as just a legal chore, rather than the threat to Chrysler’s existence and the entire U.S. auto industry that Chrysler itself had described less than three months ago. . . .

President Obama said Wednesday that “even if they (Chrysler) ended up having to go through some sort of bankruptcy, it would be a very quick type of bankruptcy and they could continue operating and emerge on the other side in a much stronger position.”

In the 30 to 45 day-stay in court, the government and most of Chrysler’s secured lenders will force a deal giving the lenders about $2 billion in cash in return for canceling $6.9 billion in debt. Of 46 firms, the three holdouts – Oppenheimer Funds, Perella Weinberg Partners, and Stairway Capital – had balked at the original $2 billion offer, as well as an increase of $250 million from Treasury on Wednesday evening.

---------

TC's summary:

Three hedge funds (actually named in this article) refused to make a deal with Chrysler, which means they prefer to take their chances with a bankruptcy judge to get a better deal. (Risky.) The government intends to make it a speedy bankruptcy and keep Chrysler operating. No liquidation. Chrysler will survive. (Yay!) It also looks like the deal with Fiat will still happen during the bankruptcy. The second page of the article said the retiree pension trust fund may end up 55% owner of Chrysler. Fiat will likely get 20% ownership.

[tclambert]

62. When it comes to auto company news, I trust the local Detroit papers

over the big national media. The locals have close personal ties to the people in the room. Reports have been somewhat inconsistent. One Italian paper reported a Fiat/Chrysler deal had been made. Then Fiat denied it.

We'll find out more later today.

This one is important. This is an inflection point in auto company history. Not even a knife edge, but a point. Chrysler's fate could go one of several different directions. A sudden 11th hour deal could save them from bankruptcy. The Fiat deal might go through, or might fall apart. The bankruptcy could degenerate into total liquidation. The implications extend far beyond Chysler to GM, Ford, parts suppliers, American manufacturing in general, unemployment throughout America and Canada, and on to the whole global economy.

It looks like the most likely outcome is a speedy, Obama administration supervised bankruptcy and a partnership deal with Fiat.

The Fiat/Chrysler synergies are too good for them to pass up. Chrysler wants Fiat's small engine and small car technology. Fiat wants access to Chrysler's North American network of car dealers. Those things are worth billions to both sides.

Settling the issue, ending the suspense, will relieve a lot of people's minds in Michigan. I cannot tell you how devastating it would have been to this state if Chrysler had been forced into liquidation.

[Dr.Phool]

65. How many credit default swaps do those hedge funds have on Chrysler?

That's incentive enough to force them into bankruptcy, and collect big time. Probably from AIG, aka, the US Taxpayer.

[Tansy_Gold]

75. I was thinkin' the same thing.

These assholes could hold out, not negotiate, because they KNEW they were covered elsewhere.

Wankers.



TG

[DemReadingDU]

108. Tansy! This reminds me of your stamp!

found on Karl Denninger's website
http://market-ticker.org/archives/1002-Oh-Beeeeen-10y-Ts.html

[Tansy_Gold]

109. DU needs to add this!!!!!!!!! ASAP!

Now, how do I copy that and use it the way you did? Just like any other image paste?

[DemReadingDU]

110. Isn't that the best!

All I did was right-click on the image, then copy the link for the properties. Paste that link of the properties in a message. Preview first to see it animated!

[Tansy_Gold]

112. Like this???

TERRIFIC!!!



:yourock: BIG TIME!!!

[Hugin]

113. I think Karl has figured out there's a few groupies here. n/t

[Ghost Dog]

74. So, a workers' cooperative, almost?

[tclambert]

92. Yeah, almost. If retirees own 55%.

If those retirees could actually run the company, that might be something. Retired automakers know a hell of a lot about cars and car companies.

[ozymandius]

6. Jobless rates rise in all U.S. metro areas

WASHINGTON - Unemployment rates rose in all of the nation’s largest metropolitan areas for the third straight month in March, with Indiana’s Elkhart-Goshen once again logging the biggest gain.

The Labor Department reported Wednesday all 372 metropolitan areas tracked saw jobless rates move higher last month from a year earlier. Elkhart-Goshen’s rate soared to 18.8 percent, a 13 percentage-point increase. That was the fourth-highest jobless rate in the country.

....

Many economists believe employers will stay in cost-cutting mode even if the recession ends this year, as some hope. The nationwide unemployment rate could top 10 percent early next year before it starts to slowly drift downward. Companies won’t feel inclined to boost hiring until they are confident any economic recovery has staying power.

http://www.msnbc.msn.com/id/30476615/

[ozymandius]

7. BOJ Cuts GDP View To Record Low, Remains Guarded

TOKYO (Dow Jones)--The Bank of Japan on Thursday downgraded its outlook for economic growth to a record low level, predicting a 3.1% contraction in gross domestic product this fiscal year, as languishing external demand decimates the export-driven economy.

BOJ Gov. Masaaki Shirakawa later told reporters that he remains on guard against downside economic risks, and that he expects the economy to pick up at a moderate pace in the latter half of fiscal 2009.

....

The projection for a 3.1% GDP contraction this year was a sharp downgrade from the 2.0% fall the BOJ envisioned in its January interim report on economic conditions.

....

The BOJ's downward revision suggests it could take additional steps to prop up the economy in tandem with the government, which on Monday finalized a Y13.9 trillion supplementary budget bill to fund its latest stimulus package.

http://online.wsj.com/article/BT-CO-20090430-705364.html

[ozymandius]

8. Obama Outlines Credit Card Reforms

The Obama administration yesterday called for an end to unfair credit card industry practices such as retroactive interest rate increases for any reason, late-fee traps that penalize borrowers with weekend or middle-of-the-day deadlines and teaser rates that last less than six months.

In a written statement released by the Treasury Department, the administration outlined practices it would like Congress to reform as it considers two bills that would crack down on the industry. One proposal would force card companies to apply payments above the minimum amount to the highest interest rate debt. To crack down on over-limit fees, the administration would also like Congress to require card companies to get customers' permission to set up accounts so transactions over the limit can still be processed.

To increase transparency, card issuers would periodically have to post information online about rates, fees and other terms. Regulators would also be required to formally request public input on market trends and consumer protection on a biannual basis.

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/29/AR2009042904909.html

[Hugin]

15. Well, there's swipe #1 at the tip of the iceberg.

Maybe they'll soon be working on more substantial problems...

Like capping interest rates that would make Al Capone Blush.

and

Like eliminating all of the games the 'in house' credit cards play...

For example, advertising 90-days-same-as-cash and then the instant the 90 days are up, charging all of the back interest to the account for those 90 days at the full interest rate. Working the timing such that unless the customer mark has paid off the balance 30 days before the deadline there's no way they can pay in time. Oh, and if the customer mark has figured this one out, adding usurious penalty fees to early payment of the balance. (There must be thousands of variations of this one (1) con-game and if you think it's only the back-room CC companies doing these shenanigans... Think again.)

[tclambert]

67. The thing that always bothered me was the credit card companies changing the terms

of the contract on the fly, basically whenever they felt like it. What kind of contract is that? Why can't I arbitrarily change the terms of the contract? Next time I get a credit card offer, I'm going to edit their legalese and send it back as a counter-offer. If they process it without reading it, as they well might, I'm gonna own them in court.

[Hugin]

82. Haha! Good luck to you!

Ahh, the things I'd do if I were infinitely wealthy. (or was related to a darn good lawyer.) :D

[Dr.Phool]

25. Durbin On Congress: The Banks "Own The Place"

http://theautomaticearth.blogspot.com/

So far this session, Sen. Dick Durbin has stood behind consumers like no other public official in Washington. He has served as the Senate Democrats' de facto point man on student aid reform, mortgage bankruptcy reform, usury reform, financial product safety, and consumer credit abuse. And around every corner, he's been met with resistance by banking industry lobbyists. In an interview with WJJG's Ray Hanania on Monday, the senior senator from Illinois stated outright that the banks "own" Capitol Hill.

DURBIN: And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place.


The ongoing negotiations about credit card reform legislation nicely illustrate Durbin's point. According to Hill sources, the U.S. House of Representatives is likely to vote on H.R. 627, otherwise known as the Credit Card Holders’ Bill of Rights Act, as early as Thursday. But it doesn't seem likely that the federal bill will be implemented quickly enough to help strapped consumers this year. For that, we can thank the banks. Last year, Rep. Carolyn Maloney (D-NY) proposed the bill of rights as a way to clean up this unregulated industry. The bill would stop credit card companies from raising interest rates on balances incurred under an old rate, would let consumers pay off loans with higher interest rates first, and would stop unfair late fees and “universal default” (the odious practice of raising interest rates on accounts in good standing when a borrower falls behind on other bills). While the bill eventually died in the Senate, Maloney reintroduced a similar version again this year and it has since passed the House Financial Services Committee.

But there's a catch. Originally, Maloney's bill required the banks to change their practices 90 days after passage. But a bipartisan group of lawmakers (including Rep. Luis Gutierrez, a recent thorn in the side of consumer groups) amended the bill earlier this month, pushing the effective date to either 12 months after passage or July 1, 2010. This had been a demand put forth by the financial services industry, which claimed that the changes would neccessitate countless hours to implement. Why is that important? The Federal Reserve passed new credit card rules in December that are scheduled to take hold in ... July 2010, rendering the Congressional legislation rather meaningless. When the Fed announced its changes, Democrats decried the extended timeline. But all it took was pressure from the banks to change their tune. And that will have a painful effect on consumers in the interim, as the Washington Independent's Mike Lillis writes:

That spells bad news for credit card users, as banks in recent weeks have installed a series of fee and rate hikes to churn profits in a struggling economy. In many cases the increases come without any warning to consumers, and they often apply to balances accrued even before the hikes arrive. “Unfortunately the way the market place is working, could use more protection, not less,” said Graham Steele, an attorney at Public Citizen’s Congress Watch. “Consumers need relief now, and yet these bills are being weakened.”


Meanwhile, Durbin's bankruptcy reform bill is on course to be gutted by the Senate today, according to the Huffington Post's Ryan Grim. Just another example of Wall Street's outsized influence.

[DemReadingDU]

30. direct link to the Durbin article

4/29/09 Durbin On Congress: The Banks "Own The Place"
http://progressillinois.com/2009/4/29/durbin-banks-own-the-place


I love TAE. Co-editor, Ilargi, finds the most interesting articles to post, and his intro every day really makes you think.

[tclambert]

68. Mr. Potter wins?

The Bailey Savings and Loan isn't too big to fail, so no bailout. The NCUA takes them over and ousts George Bailey. He gets a nice severance package and finally travels the world, but not with Mary! He travels with his mistress, Violet. They catch swine flu in Mexico and . . .

[DemReadingDU]

77. and

They return home, and Violet spreads swine flu to Mr. Potter. Mr Potter dies, as well as George and Violet. Mary wins.

[tclambert]

93. Yay, a happy ending after all!

[Demeter]

32. The Banks Aren't Going to Own Anything

if they bankrupt the country. The Congressional slaves had best break their chains and save their asses.

[ozymandius]

9. Economic Madlibbing

To be, or not to foreclose, -- that is the deficit;
Whether 'tis nobler in the fraud to suffer
The slings and kitties of bankrupt fortune,
Or to take rocks against a sea of fees,
And by scamming end them. To die, -- to smell, --
No more; and by a smell to say we end
The lie and the 666 natural shocks
That flesh is bankster to,-- 'tis a theft
willingly to be wish'd. To die, --- to smell,--
To smell! perchance to steal! ay, there's the hope;
For in that smell of death what taxpayers may come
When we have cooked off this fresh coil,
Must give us spreadsheet....

http://www.madlibs.org/

[Pale Blue Dot]

10. Timing of Goldman bond sale raises questions

Goldman Sachs, one of the 19 banks given preliminary results of the US government’s stress tests on Friday, on Wednesday sold $2bn of bonds without a federal guarantee to investors.

The securities offering, conducted in the week before the test results are made public, led to concerns that Goldman was pushing the boundaries of the bank’s agreements with regulators to keep the outcome of the tests confidential.

Corporate governance experts questioned Goldman’s timing.

“It is an odd day to raise debt. Out of an abundance of caution, Goldman should have waited until all material information was in the public domain,” said Charles Elson, director of the corporate governance centre at the University of Delaware.

The debt offering was a clear signal to investors that the preliminary test results were “not unexpected”, said a person close to Goldman, who said that the bank had determined this outcome did not constitute “material” information. Goldman declined to comment.

http://www.ft.com/cms/s/0/ac2ad492-3516-11de-940a-00144feabdc0.html

[Pale Blue Dot]

11. UK wages collapse at fastest rate in 60 years

The Office for National Statistics said average weekly earnings fell 5.8pc compared with the same month last year, to £459.10. The private sector took the full force of the fall in weekly earnings, down sharply by 7.7pc at £463.50, while average weekly earnings in the public sector actually rose by 3.2pc to £442.90. Bonuses in the financial services fell to £549.90 a week in February - which is part of the peak period for bonus payments - from £1,312.80.

"We certainly haven't seen anything like this in the last 60 years - and probably not in peacetime since the 1930s. In that sense it's much like everything else in the economy," said Michael Saunders, chief UK economist at Citigroup.

According to the ONS data, it is only the second month of falls during the current downturn, after weekly wages fell 1.9pc in January compared with a year earlier. The falls partly reflect moves by some private sector employees to freeze wages and even cut pay as they struggle to keep jobs and stay afloat during the recession.

However, Mr Saunders said that the figures did not look as negative when bonus payments were excluded. "Indeed, after bonus period you may see earnings go slightly into positive territory."

The Chartered Institute of Personnel and Development has on the other hand argued that with price deflation already a reality, the chances are that pay excluding bonuses will show "a further marked slump in the coming months".

http://www.telegraph.co.uk/finance/economics/5245729/UK-wages-collapse-at-fastest-rate-in-60-years.html

[Demeter]

19. Goldman Farts In Your General Direction

these are the cool guys, man. They're in, their hip, their CONNECTED. They can do whatever they want to, whenever they want to, wherever they want to.

You wanna make something of it? You want a piece of them? ENFORCE THE LAWS!

[ozymandius]

12. Ritholtz found this cool tool to sift through data.

Cool Tool: Google Public Data Search

I came across this very cool tool (hat tip: Flowing Data) that allows you to sift through public data easily.

-see cool chart-

As an example, see what you can do with Unemployment rate throughout the US, broken down into fine granularity by county. The specifics of this particular search matter less than the thought of an aggressive build out of public data into the Google universe.

more...

Here's a link to the Google blog that explains how it works.

[Hugin]

16. Sweet.

Thanks for pointing that out. :)

[tclambert]

72. Thank you. That is a fun tool.

Huh, Oakland County, Michigan has a larger population than all of Alaska.

[Demeter]

111. rhode Island Probably Has a Population Larger Than Alaska's.

Yup. + 1 million vs =627,000

[ozymandius]

13. Thomas Frank's Lament

From The Economic Populist:

It was surely a surprise when the WSJ hired Thomas Frank to write an opinion column. Anyone who has read either of his bestsellers, What's The Matter With Kansas? or The Wrecking Crew understands that his view of American politics just doesn't fit in with the other editorial page writers there. I, for one, am very happy he is writing there and his column today should be required reading for every citizen who cares about the future of this country.

Why Congress Won't Investigate Wall Street
Republicans and Democrats would find themselves in the hot seat.

The famous Pecora Commission of 1933 and 1934 was one of the most successful congressional investigations of all time, an instance when oversight worked exactly as it should. The subject was the massively corrupt investment practices of the 1920s. In the course of its investigation, the Senate Banking Committee, which brought on as its counsel a former New York assistant district attorney named Ferdinand Pecora, heard testimony from the lords of finance that cemented public suspicion of Wall Street. Along the way, the investigations formed the rationale for the Glass-Steagall Act, the Securities Exchange Act, and other financial regulations of the Roosevelt era.

A new round of regulation is clearly in order these days, and a Pecora-style investigation seems like a good way to jolt the Obama administration into action. After all, the financial revelations of today bear a striking resemblance to those of 1933. In his own account of his investigation, Pecora described bond issues that were almost certainly worthless, but which 1920s bankers sold to uncomprehending investors anyway. He told of the bonuses which the bankers thereby won for themselves. He also told of the lucrative gifts banks gave to lawmakers from both political parties. And then he told of the banking industry's indignation at being made to account for itself. It regarded the outraged public, in Pecora's shorthand, as a "howling mob."

The idea of a new Pecora investigation is catching on, particularly, but not exclusively, on the left.

It's probably not going to happen, though, in the comprehensive way that it should. The reason is that understanding our problems, this time around, would require our political leaders to examine themselves.

much more at link...

[Hugin]

17. Oh, that is good!

Great article... I'll probably be bookmarking this one.

[Demeter]

20. As Long As Neither Pelosi or Reid Have Anything To Do With It

The Dynamic Duo couldn't find their way out of a paper bag.

[saigon68]

24. Or Fight their way out of a Wet Paper Bag

[Dr.Phool]

28. Very good article.

It sounded very familiar. I read it late last night, but it didn't have any attribution at Automatic Earth.

[DemReadingDU]

48. very good, thanks for finding this!

[Festivito]

14. Debt: 04/28/2009 11,194,339,423,305.97 (UP 4,882,786,569.76) (TWO POSTS, both small.)

(Small moves. I had posted same report day on Tuesday's and Wednesday's Stock markets' postings. I've added a report to Wednesday's, here's the report meant for Thursday's. The link at the bottom should point to Wednesday's proper report. Not much exciting happened on the debt front on either day. I need to go to bed at decent hours. Had to EDIT, a paste problem occured.)

= Held by the Public + Intragovernmental(FICA)
= 6,886,205,201,144.77 + 4,308,134,222,161.20
UP 154,949,620.57 + UP 4,727,836,949.19

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.8, ABOUT TEN BUCKS for a 1B$ 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 the 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)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,251,743 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,552.74.
A family of three owes $109,658.21. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 32 days.
The average for the last 22 reports is 6,762,968,750.77.
The average for the last 30 days would be 4,959,510,417.23.
The average for the last 32 days would be 4,649,541,016.16.
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$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 68 reports in 98 days of Obama's part of FY2009 averaging 0.15B$ per report, 0.19B$/day so far.
There were 143 reports in 210 days of FY2009 averaging 8.18B$ per report, 5.57B$/day.

PROJECTION:
There are 1,363 days remaining in this Obama 1st term.
By that time the debt could be between 13.1 and 18.8T$.
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)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
04/28/2009 11,194,339,423,305.97 BHO (UP 567,462,374,392.89 so far since Obama 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: 1,169,614,526,393.50 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/07/2009 +000,123,552,400.07 ------------********
04/08/2009 +000,050,639,456.95 ------------*******
04/09/2009 +024,055,285,655.59 ------------**********
04/10/2009 +000,051,156,797.54 ------------*******
04/13/2009 +000,309,440,014.97 ------------******** Mon
04/14/2009 +000,167,862,523.71 ------------********
04/15/2009 +044,205,591,028.33 ------------**********
04/17/2009 -038,696,374,097.81 -
04/20/2009 +000,193,620,436.16 ------------******** Mon
04/21/2009 -000,363,758,089.93 ---
04/22/2009 +000,051,738,680.14 ------------*******
04/23/2009 -012,857,484,009.95 -
04/24/2009 -000,133,239,400.23 ---
04/27/2009 +000,285,896,492.06 ------------******** Mon
04/28/2009 +000,154,949,620.57 ------------********

17,598,877,508.17 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,529,707,620,046.90 in last 222 days.
That's 1,530B$ in 222 days.
More than any year ever, including last year, and it's 150% of that highest year ever only in 222 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 222 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.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3853631&mesg_id=3855329

[Festivito]

114. Debt: 04/29/2009 11,152,922,414,388.28 (DOWN 41,417,008,917.69) (Big DROP.)

(A big drop in the real part of the debt, the part we owe to others.)

= Held by the Public + Intragovernmental(FICA)
= 6,851,477,439,024.13 + 4,301,444,975,364.15
DOWN 34,727,762,120.64 + DOWN 6,689,246,797.05

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.8, ABOUT TEN BUCKS for a 1B$ 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 the 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)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,257,915 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,416.76.
A family of three owes $109,250.29. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 33 days.
The average for the last 23 reports is 4,668,187,113.01.
The average for the last 30 days would be 3,578,943,453.31.
The average for the last 33 days would be 3,253,584,957.55.
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$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 69 reports in 99 days of Obama's part of FY2009 averaging -0.20B$ per report, -0.03B$/day so far.
There were 144 reports in 211 days of FY2009 averaging 7.83B$ per report, 5.35B$/day.

PROJECTION:
There are 1,362 days remaining in this Obama 1st term.
By that time the debt could be between 13.0 and 18.4T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
04/29/2009 11,152,922,414,388.28 BHO (UP 526,045,365,475.20 so far since Obama 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: 1,128,197,517,475.80 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/08/2009 +000,050,639,456.95 ------------*******
04/09/2009 +024,055,285,655.59 ------------**********
04/10/2009 +000,051,156,797.54 ------------*******
04/13/2009 +000,309,440,014.97 ------------******** Mon
04/14/2009 +000,167,862,523.71 ------------********
04/15/2009 +044,205,591,028.33 ------------**********
04/17/2009 -038,696,374,097.81 -
04/20/2009 +000,193,620,436.16 ------------******** Mon
04/21/2009 -000,363,758,089.93 ---
04/22/2009 +000,051,738,680.14 ------------*******
04/23/2009 -012,857,484,009.95 -
04/24/2009 -000,133,239,400.23 ---
04/27/2009 +000,285,896,492.06 ------------******** Mon
04/28/2009 +000,154,949,620.57 ------------********
04/29/2009 -034,727,762,120.64 -

-17,252,437,012.54 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,488,290,611,129.21 in last 223 days.
That's 1,488B$ in 223 days.
More than any year ever, including last year, and it's 146% of that highest year ever only in 223 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 223 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.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3855306&mesg_id=3855336

[Demeter]

22. Swine flu prompts Mexico to shut down economy

http://news.yahoo.com/s/nm/20090430/ts_nm/us_flu_143

By Catherine Bremer Catherine Bremer 40 mins ago

MEXICO CITY (Reuters) – Mexican President Felipe Calderon told his people to stay home from Friday for a five-day partial shutdown of the economy, after the World Health Organization said a swine flu pandemic was imminent.

Calderon ordered government offices and private businesses not crucial to the economy to stop work to avoid further infections from the new virus, which has killed up to 176 people in Mexico and is now spreading around the world.

"There is no safer place than your own home to avoid being infected with the flu virus," Calderon said in his first televised address since the crisis erupted last week.

Twelve countries have reported cases of the H1N1 strain...The WHO raised the official alert level to phase 5, the last step before a pandemic.

"Influenza pandemics must be taken seriously precisely because of their capacity to spread rapidly to every country in the world," WHO Director General Margaret Chan told a news conference in Geneva on Wednesday.

"The biggest question is this: how severe will the pandemic be, especially now at the start," Chan said.

The world "is better prepared for an influenza pandemic than at any time in history," she said. WHO has stopped short of recommending travel restrictions, border closures or any limitation on the movement of people, goods or services.
...........

Mexico's peso currency weakened sharply early on Thursday after the government called for chunks of the economy to close. The peso fell 1.6 percent to 13.83 per dollar....

In Mexico City, a metropolis of 20 million, all schools, restaurants, nightclubs and public events have been shut down to try to stop the disease from spreading, bringing normal life to a virtual standstill.

Spain reported the first case in Europe of swine flu in a person who had not been to Mexico, illustrating the danger of person-to-person transmission.

Several countries have banned pork imports though the World Health Organization says swine flu is not spread by eating pork.
.....................
President Barack Obama said told an evening news conference at the White House on Wednesday there was no need for panic and rejected the possibility of closing the border with Mexico.

"At this point, (health officials) have not recommended a border closing," he said. "From their perspective, it would be akin to closing the barn door after the horses are out, because we already have cases here in the United States."

Obama also praised his predecessor for stockpiling anti-viral medication in anticipation of such an outbreak.

"I think the Bush administration did a good job of creating the infrastructure so that we can respond," Obama said. "For example, we've got 50 million courses of anti-viral drugs in the event that they're needed."

EXPERT SAYS VIRUS RELATIVELY WEAK

Masato Tashiro, head of the influenza virus research center at Japan's National Institute of Infectious Disease and a member of the WHO emergency committee, told Japan's Nikkei newspaper it appeared the H1N1 strain was far less dangerous than avian flu.

"I am very worried that we will use up the stockpile of anti-flu medicine and be unarmed before we need to fight against the avian influenza. The greatest threat to mankind remains the H5N1 avian influenza."

Guan Yi, a microbiologist at the University of Hong Kong, said the swine flu virus could mix with avian flu, or H5N1.

"If it goes to Egypt, Indonesia, these H5N1 endemic regions, it could turn into a very powerful H5N1 that is very transmissible among people. Then we will be in trouble, it will be a tragedy."

The WHO's Chan urged companies who make the drugs to ramp up production. Two antiviral drugs -- Relenza, made by GlaxoSmithKline and Tamiflu, made by Roche AG and Gilead Sciences Inc -- have been shown to work against the H1N1 strain.

Mexico's central bank warned the outbreak could deepen the nation's recession, hurting an economy that has shrunk by as much as 8 percent from the previous year in the first quarter.

The United States and Canada have advised against non-essential travel to Mexico, and the European Union's health commissioner advised against non-essential travel to areas badly hit by swine flu. Many tourists were hurrying to leave Mexico, crowding airports....

(Reporting by Maggie Fox and Tabassum Zakaria in Washington;

Jason Lange, Catherine Bremer, Alistair Bell and Helen Popper in Mexico City; Laura MacInnis and Stephanie Nebehay in Geneva and Yoko Nishikawa in Tokyo; writing by Andrew Marshall and Dean Yates; editing by Philippa Fletcher)

[tclambert]

76. Is there any way to invest in Swine Flu? Seems like that stock is definitely on the rise.

I know Ozy doesn't like us to give investment recommendations. I broke that rule recently by recommending Forever Stamps. (They're going up two cents on May 11th, about 4.8%. That is a for sure Return On Investment.) Swine Flu seems sure to grow. If it's in the slums of Mexico City, where people are packed so tight it makes a sardine can look spacious, millions will catch it. It has been confirmed in several countries. There's really no stopping it now.

Maybe AIG could figure out a way to offer futures contracts or some sort of derivative based on the spread of the flu. I'll bet their quants could come up with something.

[Name removed]

90. Deleted message

Message removed by moderator. Click here to review the message board rules.

[DemReadingDU]

99. L.A. Times: Scientists see this flu strain as relatively mild

4/30/09 Scientists see this flu strain as relatively mild
By Karen Kaplan and Alan Zarembo

As the World Health Organization raised its infectious disease alert level Wednesday and health officials confirmed the first death linked to swine flu inside U.S. borders, scientists studying the virus are coming to the consensus that this hybrid strain of influenza -- at least in its current form -- isn't shaping up to be as fatal as the strains that caused some previous pandemics.

In fact, the current outbreak of the H1N1 virus, which emerged in San Diego and southern Mexico late last month, may not even do as much damage as the run-of-the-mill flu outbreaks that occur each winter without much fanfare.

"Let's not lose track of the fact that the normal seasonal influenza is a huge public health problem that kills tens of thousands of people in the U.S. alone and hundreds of thousands around the world," said Dr. Christopher Olsen, a molecular virologist who studies swine flu at the University of Wisconsin School of Veterinary Medicine in Madison.

Flu viruses are known to be notoriously unpredictable, and this strain could mutate at any point -- becoming either more benign or dangerously severe. But mounting preliminary evidence from genetics labs, epidemiology models and simple mathematics suggests that the worst-case scenarios are likely to be avoided in the current outbreak.

"This virus doesn't have anywhere near the capacity to kill like the 1918 virus," which claimed an estimated 50 million victims worldwide, said Richard Webby, a leading influenza virologist at St. Jude Children's Research Hospital in Memphis, Tenn.

"There are certain characteristics, molecular signatures, which this virus lacks," said Peter Palese, a microbiologist and influenza expert at Mt. Sinai Medical Center in New York. In particular, the swine flu lacks an amino acid that appears to increase the number of virus particles in the lungs and make the disease more deadly.

full article...
http://www.latimes.com/features/health/la-sci-swine-reality30-2009apr30,0,3606923.story

[tclambert]

94. Ooh, ooh! What about whoever makes the test for confirming cases of Smithfield Flu?

You know the testing is going to go up, up, up.

Ah, it's probably some tiny corner of a giant pharmaceutical company. Testing could increase by a factor of 1,000 and only add .01% to the revenues of the company.

[Demeter]

23. Is "AIG" Wall Street Talk for "TANF"?

http://www.prospect.org/csnc/blogs/beat_the_press_archive?month=04&year=2009&base_name=is_aig_wall_street_talk_for_ta

The NYT alluded to the AIG bailout in the context of the GM negotiations without giving readers the full context. Representative Thaddeus McCotter, a Republican from Michigan, complained that it would be outrageous if the government were to honor credit default swaps (CDS) issued against GM bonds for creditors who are refusing to accept a deal for a write-down on their GM debt.

The point is that the CDSs issued by AIG should be worthless at present. AIG is bankrupt and has no resources to pay any portion of these CDS without the government's backing. However, if the government steps in and honors CDSs issued against GM debt by AIG at market value, as it has done with other CDSs issued by AIG, then creditors have far more incentive to take a hard line in negotiations on debt write-downs. In effect, the government is paying these creditors not to reach a deal on write-downs.

The Treasury department has yet to give any explanation for the $160 billion (@ $1300 per household) in payouts that it made through AIG. This money has gone to several of the largest Wall Street banks, as well as several large foreign banks. There was no legal obligation whatsoever for the government to make these payments and in some cases there would not have even been a legal obligation for AIG to have made these payments, if it could have survived without government money.

--Dean Baker

[Demeter]

35. Cut-price bids made for AIG’s aircraft unit

http://www.ft.com/cms/s/0/77fb4d22-3297-11de-8116-00144feabdc0.html

International Lease Finance Corp has drawn a step closer towards separation from its troubled parent, insurer AIG, with three investment groups submitting bids to acquire the aircraft lessor for less than $5bn.

People close to the situation said one consortium was led by Thomas H. Lee Partners and Carlyle Group, while Onex and Greenbriar Equity Group headlined a second group. The third bidder’s identity could not be determined.

While the three bids may be considered to be low given ILFC’s book value of $7.6bn, they reflect the industry’s uncertain outlook, tough funding markets and AIG’s need to unload assets to repay $100bn in debt and equity to the US government. Nevertheless, the sale of ILFC, one of the most successful businesses in AIG’s sprawling portfolio, would represent the biggest disposal by the insurer since it was first bailed out by the US government last September.

AIG is likely to negotiate with the three groups for several weeks before presenting the winning bid to the New York Federal Reserve and US Treasury, which hold a stake of about 80 per cent in the insurer. AIG, the bidders and ILFC declined to comment.

The insurer’s near-collapse last September has limited ILFC’s access to cheap funding, which is considered critical for large lessors such as GE Capital, General Electric’s finance arm.

AIG has pledged to support ILFC until its sale. But the division’s efforts to raise several billion dollars through a new credit facility have met with tepid demand from European banks and other traditional sources of aviation finance, people familiar with the matter said.

Additional funding may come from the Fed, which has been in talks with ILFC to extend the company a $5bn loan, and from key aerospace manufacturers that have come to rely on ILFC.

The sources of capital have been viewed as vital to the sale process to assure would-be buyers that ILFC can endure the credit crisis and a brutal downturn in demand for air travel.

People familiar with the matter said that other banks might be willing to participate in the credit facility once a buyer emerges from the auction.

ILFC has ordered 168 aircraft worth $16.7bn from Boeing and Airbus.

The aircraft are scheduled to be bought during the next 10 years, with 49 of them – worth about $3bn – set to be delivered this year.

[Demeter]

27. Irish jobless rate surges to 11.4%

http://www.ft.com/cms/s/0/3786022c-34c8-11de-940a-00144feabdc0.html

Ireland’s unemployment rate climbed to 11.4 per cent in April, from 7.7 per cent at the end of 2008, putting further strain on the public finances.

The independent Economic and Social Research Institute think-tank predicted worse to come, forecasting that the jobless number will average 16.8 per cent of the workforce in 2010, the highest rate since the mid 1980s. It estimated unemployment will average 13.2 per cent this year....

[Demeter]

29. Gazprom waives Ukraine gas fines

http://www.ft.com/cms/s/0/344b98e2-34c8-11de-940a-00144feabdc0.html

Gazprom, Russia’s state-controlled energy giant, has agreed to waive hefty fines upon Ukraine, which purchased only a third of planned natural gas supplies so far this year after its recession-battered economy shrank sharply.

”I would like to thank for its understanding. Today, we are taking as much as we can afford during the crisis,” Yulia Tymoshenko, the Ukrainian prime minister, said at the beginning of talks with Vladimir Putin, her Russian counterpart.

The agreement was brokered on Wednesday between the two increasingly-friendly leaders....

In return for Moscow’s leniency, Russian officials said Kiev also agreed to include Gazprom, along with the European Union, in plans to modernise and possibly manage Ukraine’s vast gas pipeline network. Moscow has sharply opposed a March agreement in which Kiev and Brussels unilaterally adopted a framework plan to modernise the pipeline.

Moscow and Kiev also pledged to renew co-operation in their Soviet-built and intertwined aviation and space technology sectors.

Сash-strapped Ukraine is also seeking Moscow’s support to purchase large volumes of gas during the summer period for underground stockpiles, which is needed to fill peak winter demand.

Ms Tymoshenko said Ukraine, which jointed the World Trade Organisation last year, would support Russia’s membership aspirations.


SOUNDS LIKE AN OFFER UKRAINE CAN'T REFUSE---GOOD THING THEY HAVE SOMETHING TO BARGAIN WITH.

HAVE THE FINANCIER IDIOTS EVER REASONED TO THIS POINT? WHAT WOULD THEY TAKE IN LIEU OF THEIR TON OF FLESH, WHEN PEOPLE SIMPLY CANNOT PAY? AND WHY THE HELL AREN'T THEY SIMPLY PUT OUT OF BUSINESS, WHICH IS THE ONLY LEGAL THING TO DO?

[Demeter]

33. Silicon Valley seeks alternative funding

http://www.ft.com/cms/s/0/1ce4badc-34e9-11de-940a-00144feabdc0.html

With Wall Street all but closed to initial public offerings, investors in Silicon Valley’s technology start-ups are turning in growing numbers to new, informal methods to sell some of their holdings.

The rise of this new secondary market has opened a back-door way to invest in private companies at knock-down prices, according to backers, since the sellers are often forced by their need for immediate liquidity to cut their holdings.

The informal secondary trading has emerged as an important outlet at a time when frozen public markets might otherwise damage the start-up financing system, said veteran venture capitalist Tim Draper, whose firm has backed one of the new intermediaries in the field. “Without liquidity, venture capital investors will stop investing in VC funds, who will no longer be able to support entrepreneurs,” he said. “The American Dream is at risk.”

Dixon Doll, a leading Silicon Valley venture capitalist, said: “The current system is broken.” As chairman of the National Venture Capital Association, he kicked off a campaign on Wednesday to fix what the start-up financiers say ails them. Yet even if they are right in the diagnosis, finding the cure is going to be hard.

The dearth of capital for flotations has fuelled the rise of the new class of investment funds, which specialise in snapping up stakes in venture capital funds, direct holdings in venture-backed companies, or both.

Investment vehicles created to invest in this booming area, such as San Francisco-based Industry Ventures and Saints Capital , report rapid inflows of funds. At the same time, specialist dealers and brokers have emerged to bring together buyers and sellers of stakes in individual start-ups, or even of entire portfolios of venture investments.

Traditionally, venture capital funds would take small companies through three or four rounds of financing and then reap the rewards with a market listing.

“There now exists an epic void in the ability of capital markets to bridge to an ,” said David Weild, a former vice-chairman of Nasdaq.

Mr Weild last month joined the board of Inside Venture, a match-maker for institutions and the late-stage venture-backed companies that in ordinary times would be going public. He said one such candidate was earning $80m on annual revenue of $1bn and still cannot get out of the gate.

The new vehicles are attracting funds. Industry Ventures’ investment pool has more than tripled in three years to $500m. Saints Capital said it had invested $360m since last May, compared with only $20m over the previous 18 months.

Many venture capitalists argue that the listings drought is not cyclical but a delayed structural reaction to issues such as tighter regulations and the disappearance of independent investment banks.

Predictably, a part of the venture capitalists’ proposed cure for this decline involves lighter regulation and a less onerous tax regime.

More fundamentally, they hope to precipitate deeper changes in US finance. The proposals amount to trying to turn back the clock to recreate conditions that existed in the capital markets of two decades ago.

At that time, according to the NVCA, a number of factors converged to create a conducive environment for small, high-growth public companies in the US. A group of small investment banks in Silicon Valley, known as the “Four Horsemen”, and a network of small legal and accounting firms grew up to service the IPO business. A generation of institutional investors, such as Fidelity, pioneered the idea of growth investing.

Much has changed. The dotcom boom prompted the acquisition of the Four Horsemen by big banks, which critics say have less interest in nurturing growth companies because fees are small. Most important, investors such as Fidelity have become large and are less interested in the small amounts of money that can be invested in IPOs.

AND THAT'S WHERE THE BANKS HAVE MADE THEIR BIGGEST MISTAKE--THEY HAVE SPOILED THEIR SEED MONEY, AND CANNOT BUY A SHARE IN THE FUTURE. OF COURSE, THE WAY THEY ARE RUNNING THINGS, THERE MAY NOT BE ANY FUTURE FOR THE BANKS OR ANYONE ELSE.

[Demeter]

36. Warning over UK derivatives backlash

http://www.ft.com/cms/s/0/d0609d34-32a9-11de-8116-00144feabdc0.html

London risks further damage as a financial centre if policymakers rush to regulate the over-the-counter derivatives markets without distinguishing between instruments that helped cause the financial crisis and those that did not, a report commissioned by the City of London Corporation said on Monday.

The report, prepared by consultancy Bourse Consult, will urge regulators not to “throw the baby out with the bathwater” amid recent calls for OTC – or privately-negotiated – derivatives markets to be subjected to greater clearing and regulatory scrutiny.

The warning is a sign that players in OTC derivatives, one of the largest parts of financial services, are starting to lobby against what they see as the potential for a regulatory backlash that could inflict serious collateral damage to the City, home to the bulk of OTC derivatives activity.

The recent G20 meeting pledged to “promote the standardisation and resilience of credit derivatives markets, in particular through the establishment of central clearing counterparties subject to effective regulation and supervision”.

London accounts for 43 per cent of the value of OTC derivatives traded, with the US on 24 per cent, Bourse Consult said.

It rejected the widely-held assumption that derivatives in general were to blame for the crisis, arguing that critics fail to distinguish between derivatives that functioned normally – such as foreign exchange and interest rate swaps - and collateralised debt obligations and other structured products.

“The credit derivatives which were traded most heavily on the OTC derivatives markets were CDS. There is very little evidence to suggest that these contributed in any significant way to the crisis,” the report said.

It said the push by regulators and legislators for such instruments to become more transparent had become “a highly politicised issue”.

“It seems inevitable that CDS and possibly even the whole OTC derivatives market are going to be much more heavily regulated as a result of political pressure that ‘something needs to be done’ about the OTC market.

“In accepting the inevitable additional regulation that will come, it is important that the very successful OTC derivatives market is not crushed in the process,” wrote the report’s author, Lynton Jones, a former chief executive of the London-based International Petroleum Exchange.

He said the derivative at the centre of the crisis were collateralised debt obligations, which were used as part of the mortgage securitisation process by banks. The problems in the CDO market “totally outweighed the perceived problems of CDS”.

“It is important not to throw the baby out with the bath water. A very large proportion of OTC derivatives had no involvement whatsoever in the financial crisis,” Bourse Consult said.

Last month the world’s 18 inter-dealer brokers, including the biggest five – Icap, Tullett-Prebon, GFI, BGC and Tradition - funded a push by the Wholesale Market Brokers Association to convince policymakers that the OTC derivatives markets in which they act as intermediaries still have value in the wake of the financial crisis.

Terry Smith, Tullett-Prebon chief executive, writing in today’s Financial Times, said London’s dominant share of the OTC markets made it “all the more worrying that the prescriptions put forward for the OTC markets show a blatant disregard for the facts, and the cultivation of self interest by politicians and some operators”.

The report also hit back at suggestions by some exchanges that problems in the OTC market could have been avoided if such products had been traded on fully-regulated exchanges.

Exchanges that already own clearing houses have seized on calls by senior policymakers that more OTC products be processed through a clearing house, to protect against the fallout from defaults by trading counterparties.

That has led to fears among the inter-dealer brokers that the exchanges might be using the regulatory environment to bring about a shift of the trading of OTC products onto exchanges, not merely the clearing of such products.

Mr Jones, also a former London Stock Exchange executive, wrote: “Those arguing that OTC products should be moved onto exchanges are mistaken. This would be an extremely foolish move which could even result in damage to exchanges.”

Commenting on the Bourse Consult report David Clark, WMBA chairman, said: “The WMBA strongly supports the paper’s conclusion that any attempt to move OTC products onto exchanges would result in a diminution of liquidity in both OTC and exchange-traded markets.

“This, in turn, would have potentially severe consequences in the real economy as end users of OTC markets such as governments, corporates and pension funds, that would experience difficulty in hedging their risks and obtaining the financial products necessary to achieve their investment and financial targets.”

[Demeter]

37. Allianz and Amex may cash in ICBC stakes

http://www.ft.com/cms/s/0/0faf582a-3298-11de-8116-00144feabdc0.html

Two more foreign investors in Chinese banks are expected to cash in lucrative stakes and raise a total of more than $2bn this week as a lock-in period ends for their holdings in Industrial and Commercial Bank of China.

Allianz, the German insurer, holds nearly 2 per cent of ICBC, while American Express, the US financial group, owns 0.4 per cent, and each is free to offload half of their holding as early as Tuesday.

Such a sale would raise a combined $2.1bn, based on the bank’s closing share price in Hong Kong on Friday.

The remaining shares can be sold in October.

People familiar with the situation expect Allianz and American Express to waste little time in selling the maximum number of shares permitted.

“The timing of any sale will of course depend on market conditions,” said one. “But don’t be surprised if it happens soon.”

The two shareholders invested in ICBC, which is now the world’s biggest bank by deposits and market capitalisation, alongside Goldman Sachs in 2006 as part of a wave of overseas investments in Chinese banks.

Goldman, which holds 4.9 per cent of the Chinese lender, some on behalf of investors, last month pledged to retain at least 80 per cent of that stake until April 2010. Its stake is worth more than $8bn at current prices.

Allianz and American Express are expected to hire investment bank Goldman Sachs to oversee any potential share sale....MORE

[Demeter]

39. Fed study puts ideal US interest rate at -5%

http://www.ft.com/cms/s/0/37877644-32c9-11de-8116-00144feabdc0.html

The ideal interest rate for the US economy in current conditions would be minus 5 per cent, according to internal analysis prepared for the Federal Reserve’s last policy meeting.

The analysis was based on a so-called Taylor-rule approach that estimates an appropriate interest rate based on unemployment and inflation.

A central bank cannot cut interest rates below zero. However, the staff research suggests the Fed should maintain unconventional policies that provide stimulus roughly equivalent to an interest rate of minus 5 per cent.

Fed staff separately estimated what size and type of unconventional operations, including asset purchases, might provide this level of stimulus. They suggested that the Fed should expand its asset purchases by even more than the $1,150bn (€885bn, £788bn) increase policymakers authorised at the last meeting, which included $300bn of Treasury purchases.

The assessment that the US central bank needs to provide stimulus equivalent to a substantially negative interest rate is unlikely to have changed ahead of this week’s policy meeting.

The Fed is not likely to embark on any substantial new programmes at this meeting, in large part because it will not have downgraded its economic forecasts since the last meeting. Indeed, Fed officials may see the risks to the economy as a little more balanced than they were in March, though policymakers probably still see these risks as overall weighted to the downside.

This could set the stage for a more detailed discussion of the framework that will ultimately govern the Fed’s exit strategy....
Still, many Fed officials expect they may well keep rates near zero for another 18 months to two years and some might see value in making this more explicit....

MORE

[tclambert]

78. So we borrow money from them, and THEY make monthly payments to US?

Sweeeet.

[UpInArms]

40. dollar watch

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

Last trade 84.524 Change -0.142 (-0.18%)

Dollar Finds Strength in Fed's Outlook, but is it Enough?

http://www.dailyfx.com/story/topheadline/Dollar_Finds_Strength_in_Fed_s_1241050134142.html



The Economy And The Credit Market

The US dollar is still in the running for the title of ‘market’s ultimate safe haven’ (for better or worse); but can the currency develop a strength of its own through fundamentals? Just over the past few days, the outlook for US monetary policy, growth and financial health was updated through a round of heavy fundamental event risk. And, though the headline readings are far from optimistic, the general sentiment behind the data offers tangible evidence that the world’s largest economy may be emerging from the worst global crisis since WWII - perhaps even before its major trade counterparts. The most impressive headlines would all cross the wires today. For growth (the Great Equalizer in the currency market at this point), 1Q GDP would show a far more modest improvement that economists had expected; but the consumer spending offered a silver lining. What’s more, after the Fed announced it was keeping rates unchanged and wouldn’t increasing its Treasury or MBS purchases, they noted that the pace of recession was slowing. Even early reports that at least six banks could fail the stress test are balanced by positive forecasts from the White House and thawing credit markets.



...more...

Currencies Not Bothered by Negative Developments

http://www.dailyfx.com/story/bio2/Currencies_Won_t_be_Bothered_by_1241088511552.html

Price action has been more than impressive overnight with the markets seemingly unbothered by a flurry of risk sensitive developments that up until recently would have triggered a fresh wave of flight to safety buying. The WHO has upgraded the flu swine virus to phase 5, a notch just under global pandemic, while the WSJ reports that Chrysler talks have collapsed and the company is on the verge of filing for Chapter 11. Meanwhile, ECB Stark has come out with some dovish talk, after saying that there is still modest room to move on rates. On the data front, Eurozone CPI was a shade softer than expected while the unemployment rate was much higher than expected. Price action in Kiwi has been somewhat suspicious today, with the currency failing to maintain yesterday’s outperforming status after the RBNZ slashed rates as expected by 50bps to 2.50%, and more importantly were very downbeat in their assessment on the outlook for the economy. Finally, in Japan, the BoJ has reiterated that the economy has worsened sharply and that financial conditions are severe, after leaving rates at 0.1%. Despite all of the above, market sentiment remains high with the USD and Yen remaining well bid and global equities surging once again. Market participants also continue to focus on a cautiously optimistic Fed and some encouraging components out of Thursday’s GDP data. Some bright spots overnight include better than expected unemployment numbers out from Germany and a not as bad Nationwide house price release out of the UK. Looking ahead to the North American session, Canada GDP (-0.1% expected), raw material (2.0% expected) and product prices (0.5% expected) are due at 12:30GMT, along with US personal consumption (0.2% expected), personal income (-0.2% expected), personal spending (-0.1% expected), initial jobless claims (640k expected) and continuing claims (6200k expected). Chicago PMI (35.0 expected) is due shortly thereafter at 13:45 GMT. US equity futures point to an open some 2% higher while on the commodity front, oil is higher by some 1.50% while gold has pulled back, down 0.75%.

...more...

[TheWatcher]

43. How Much Longer Can We Continue To Go On Like This?

US stock futures rise ahead of economic data

Wall Street set for another gain as investors await data on jobless claims, personal spending

* Madlen Read, AP Business Writer
* On Thursday April 30, 2009, 6:59 am EDT


NEW YORK (AP) -- Stocks are set to extend their rally as investors hoped for reassuring readings on jobless claims, personal spending and manufacturing.

In premarket trading Thursday, stock futures rose sharply ahead of the economic data. The reports are not supposed to show a strong turnaround. Economists predict that new claims rose modestly last week, while income and spending dipped slightly in March. And they forecast a slight rise in the Chicago purchasing managers' April index.

But investors know that the stock market usually rebounds before the economy does, and they do not want to miss out on a rally. Signs have been emerging that conditions in the United States, while not yet healthy, are becoming less dire. On Wednesday, the major stock indexes surged more than 2 percent after the government said the economy shrank sharply in the first quarter, but the Federal Reserve said the contraction appears to be slowing.

Investors appeared unfazed by news Thursday that Chrysler LLC might be on the brink of bankruptcy. Talks have disintegrated between the Chrysler's lenders and the government, a person familiar with the matter said, over the automaker's debt.

First of all, I don't know about the rest of you, but I am really getting sick of the Propagandists' use of the word "Investors." There are no "investors" involved in this nonsense. There is no "investing." There is only voracious speculation, gambling, and manipulation at the EXPENSE of any real "investors" that may still exist in this Market, and at the expense of the rest of us just trying to hold on for dear life.

We know the Market environment is not real. We know TPTB, Washington, The Government, The Fed, and The White House have no serious plans to do anything that would actually help the REAL Economy recover.

They continue to Propagandize the public on a level that only a willful fool or a person with the complete inability to use reason and logic on even a basic fundamental level could possibly believe.

The real economy continues to deteriorate unabated.

They get in your face and tell you a 6.3% deterioration in the GDP is signs of stabilization.

People, we are in BAD Shape. It is clear that the nation has been abandoned and left to reality's unforgiving mercies, and those in power are going to do less than nothing to solve any of the real issues that face us.

So to put it simply:

How long can they continue to manipulate and create a false, artificial environment in the Markets without the real economy improving at all?

How can there ever be a recovery with no jobs, no manufacturing, and no increase of real wages in the face of ever increasing costs of living, health care, etc?

How long can the country as a whole continue to function like this?

I said it in another post yesterday that I wasted in another thread that should have been posted here.

WE NEED JOBS. NOT PROPAGANDA

I mean, at long last, just READ the kind of nonsense we are being fed every day. it doesn't get more frightening or succinct of an example than what is posted above.

THAT is not the kind of reporting that is indicative of a country that has any interest in being free, prosperous, or what our forefathers fought and DIED for.

At long last, What Has Happened To Our Country?

And why can't We The People, save for precious few percent, be bothered to do anything about it?

[Tansy_Gold]

46. We been sayin' this for months, Watcher.

The Indian government can OFFICIALLY whine that the US has no right to deny H1-B visas to Indian nationals because it would hurt the Indian economy. We have Canadians who come here on DU and whine that the US cannot impose buy-American restrictions on infrastructure projects because Canadian steelmakers need jobs. American Axle just outsourced 500 jobs to Mexico. Obama's promise was never to keep good living-wage manufacturing jobs in the US; it was only that he would stop giving tax breaks to the companies that outsource. There was a headline here in LBN about 22,000 "green" jobs being outsourced to India.

Americans are addicted to cheap plastic crap from China far more than they are aware of their need for a viable domestic economy. A friend who was whining the other day about the potential loss of her GM-retiree husband's health care benefits and substantial pension just a few breaths later talked about having spent the week-end buying shoes. She doesn't know exactly what she's going to do with the eight new pair she bought "but they were on sale and I just couldn't pass them up." She already has so many shoes that she can no longer fit all the boxes under her bed. This is how virtually our entire consumer economy behaves.

There are people here on DU who will vociferously defend the "global economy" and lambaste anyone -- or at least any American -- who proposes economic protectionism. I don't think they've ever been taught critical thinking.



Tansy Gold, who has

[TheWatcher]

47. I know Tansy, and save for the precious gems who Post in this thread, and in the Economic Forum

It's mostly been falling on Deaf Ears.

People want to believe The Con so badly, and hold on to their false paradigms so tightly, they can't be bothered to think critically.

I had a friend who posted on another Board put it so simply, so succinctly the other day:

"It's not that America doesn't WANT to be Free, it's that their citizenry, for the most part, just can't be bothered to be Free."

Most people are lost in a haze of glazed over hypnosis that just can't be broken. And a big part of the problem is the mentality of people like you described in your post.

I swear Tansy, this is like Pompeii without the Volcano.

It's almost like people LOVE to be lied to. They LOVE to be scammed.

If I had to think of two words to describe our Nation right now, it would NOT be Superiorly Indifferent.

No, my dear Tansy, we have gone far beyond that.

Try Terminally Oblivious.

"The Comfort You Demanded Is Now Mandatory"

[Tansy_Gold]

53. "Terminally Oblivious" exactly

That phrase reminded me of a comment another acquaintance made shortly before the November election:

"No, I'm not going to vote. I don't care who wins or who loses. I pay no attention to it at all. It doesn't affect my life, and if I don't know about it, I won't worry about it. I just want to pretend it's all not there."


Not long after the election, this same acquaintance had to buy a new car, his having been totalled in an accident. He had always bought brand new cars, always paid cash with a good trade-in rarely more than two or three years old. He thought he would get an insurance settlement that would cover most of the cost of replacing his three-year-old vehicle. His shock came not from the paltry insurance settlement or even the sticker price of a new car. No, his shock came when he went to withdraw funds from an investment account to pay the cash balance and discovered how much his account had decreased in the past year. "I lost over 50% of my money!" he wailed.

Well, he wanted to not know so he wouldn't worry. . . . . . .

Reality, even when or maybe especially when ignored, has a habit of hitting you upside the head with a 2 x 4.



Tansy Gold

[DemReadingDU]

55. Terminally Oblivious

Yep, that's my family and friends exactly. They have other priorities and don't pay any attention to what is really going on. Besides they say, what can they do about it. Their elected Representatives and Senators are taking care of all that. And Obama has the best people figuring out how to get us thru this financial mess. Recovery is just around the corner, and the stock market always comes back. Nothing to worry about. But after the bubble bursts and people are jobless, homeless pennyless and hungry, who is going to feed all the hungry people? Oh, Obama has warehouses full of food and he'll order out the National Guard to quell potential riots. In every city and town?????


:crazy:

[Dr.Phool]

56. The best I can remember, Nobody campaigned specifically to kill the economy.

Or the American worker. There was a lot of "hope" and "change" on the one side, and the same old shit, on the other, with a few nut flakes thrown in.

You and the Watcher are right (good to hear from you again Watcher). There is a major deficit in critical thinking in this country. We're propagandized to the point of delirium.

I don't know what to do any more. Nobody wants to listen. We cannot survive as a country without good paying jobs. Bailouts to the auto industry should be contingent on ALL production being moved back stateside. For example, GM had the audacity to take their first round of bailouts to invest in a Brazilian plant. :wtf:

Eliminate outsourcing (Yeah, the banks have stepped it up too), H1B Visas, and put our people back to work. It's the only way we can survive.

[DemReadingDU]

66. major deficit in critical thinking

A lot of people did see what the past 8 years under Bush has done to this country, but they can't see the same spinning is going on in Obama's administration. They can't seem to think that the propaganda sounds too good to be true. All that Hope and Change.

[TheWatcher]

85. Speaking Of A Major Deficit in Critical Thinking

Check out this thread:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3854546

People are having a Happy Party Cheer-A-Thon because of A Report that "Bush is more unpopular now that he has left office."

Lots of glee and backslapping.

But notice that one little post toward the bottom pointing out that neither him nor anyone in his Cabinet have been held accountable for their crimes.

Crickets.

But Hey, At least He's Unpopular!!!!!!!!!!1111111111111

RAH! RAH! AMERICA!!!!!!!!!!!!! GO TEAM!!!!!!!!!!!!

:wtf:

As Depeche Mode would probably say: Some Great Fucking Reward

[Demeter]

51. It's the Run Up to Memorial Day

Then the PTB all retire to the Hamptons and reality intrudes. Summer vacations, ala Bush, doncha know?

[PassingFair]

52. Should be an OP in GD, Watcher.....

I'm in Michigan, and the even
HERE, people still have their
heads in the sand.

I'm in panic-mode myself.

"Reckless fools lost first because they deserved to lose, and careful, wise men lost later because a world-wide earthquake doesn't ask for personal references."

--Edwin LeFevre, 1932

[Dr.Phool]

61. That's living dangerously.

You need a shower, just wandering into GD anymore. Much less posting. I got involved in some pretty nasty ones last week with people who thought it was a good idea to replace unionized state workers with prison labor, just because the Dem Governor of Ohio came up with the idea.

One Party. The Fascist Money Party.

[TheWatcher]

73. Isn't it Ironic that some of the same people we stood hand in hand with during the last eight years

of Hell during the last dictatorship, are behaving curiously and with a similar mentality as the very Bushbots we all opposed so vehemently?

Unquestioning. Blindly Following. Completely and Willfully oblivious and ignorant to ANY signs that a Bill Of Goods has been sold not only to them, but the entire country. Voraciously intolerant of ANY kind of scrutiny or questioning of policy.

Some are becoming a lot like the very monsters they fought against.

Welcome To Bizarro World.

[tclambert]

79. But prison labor means you could always get a job.

Just go punch a cop. Whoosh, off to a prison job with you! Wipe out the unions, arrest everyone, and you've got the capitalist ideal--slave labor! And with the lowest labor costs possible, we can sell our cheap stuff at WalMart to . . . um, . . . uh-oh, where did all the customers go? What's that? Customers are the same as workers? Slaves can't afford to buy much? Well, that's inconvenient. Huh. They ought to teach that at B school.

[Dr.Phool]

84. Sometimes that doesn't work.

In my younger days, I got drunk, and wound up punching a cop.

They put me in a cell with a guy that they wanted to beat up, but couldn't. I just slept it off, and nothing happened.

[bread_and_roses]

115. OMGoddess. I am glad I missed that (n/t)

[TheWatcher]

69. I would say I'm surprised PassingFair, but I am not.

It seems unbelievable.

But like Tansy said, people have adopted an "Ignore it and it will not exist." mentality when it comes to dealing with EVERYTHING.

At the same time, those same people will virulently shout down ANYONE who DARES shed light on reality with extreme prejudice, via mocking, giggling, snickering, hostility, and even anger and threats.

As for the suggestion, at this point GD is a lost cause to voices like mine or anyone who posts in this thread on a daily basis.

They want to believe they are going to be saved and that none of this will affect them.

So many at DU are so invested and wedded to the idea that "Our Football Team won, so things have no choice but to get better by default and principle alone", that they cannot see that we have been sold a Bill Of Goods, and that the weapons of choice to be used against us this time are "Hope" and "Change", instead of "Fear", "Patriotism", and "Safety" which were the weapons of choice of the last dictatorship.

[Dr.Phool]

86. There's an appropriate saying for that.

"Dear God, protect me from your followers".

I had been willing to give Obama patience and the benefit of the doubt. I said before the election, that it would take a generation to straighten out the mess Bush created in 8 years. But right off the bat, I saw a lot of bad choices being made. Especially his cabinet and economic team. Actually, I was wary of economic policy before the election, when I found that Goolsby was his chief economic adviser. I didn't want anybody from the Chicago School anywhere near the administration. But, point that out, and it's blasphemy.

[TheMachineWins]

101. That's for sure

Some people even get banned for defending themselves against the onslaught. Several of my favorite posters are now gone.

[Pale Blue Dot]

57. It's going to get worse today: The MSNBC headline is "Jobless claims drop unexpectedly."

The important story is that continuing claims have risen to another new record, but MSNBC's headline instead touts the phoney-baloney "feel good" story that the horrible level of new claims was slightly less horrible than expected. It's disgusting and frustrating.

Here's another important tidbit: school districts across the country (including my own) have announced big layoffs. Those layoffs won't actually take place until school lets out for the summer. Expect a HUGE spike in jobless claims at the end of June/early July.

[DemReadingDU]

60. and hundreds of thousands layoffs when GM shuts down for the summer

At some point, the Terminally Oblivious will begin opening one eye, and that's when a panic will start.

[Demeter]

116. Anything That Cannot Continue, Will Not

Might doesn't make right. It doesn't even make might.

[TheWatcher]

50. Well, since our Entire Financial System is really one Big Casino, ths shouldn't surprise anyone

From one of the Posters at The WallStreetBear Forum

leverage finance, bankers rolling the dice on the strip, literally
riptied - Thu, Apr 30, 2009 - 03:02 AM

http://finance.yahoo.com/news/MGM-Mirage-Dubai-reach-pact-apf-15077506.html?.v=7

"MGM Mirage received what it called an irrevocable letter of credit for $224 million to secure its payments for CityCenter, which the casino company has touted as the most expensive private commercial development in U.S. history."
...
"MGM Mirage also newly agreed to pay any completion costs if the project goes over its current projected budget of $8.5 billion. That figure has been coming down from as high as $9.2 billion"
...
"the agreement puts the casino company in the best possible position as it works to restructure its balance sheet, which included more than $13 billion in debt as of the end of last year."
......
note: the book value of mgm is only 1.7B


So the big time finance world is still acting like Vegas, which is full of cratering RE, is just going to keep rolling along, there's no recession in sight it would seem, amazing! The Dubai money boyz', co-investors if you can call it that, just aren't losing enough building their own desert fascist disney fantasy world, they need to loose a bunch in our desert too!

*******************************************************************************************************

You know, one of these days you are going to go into a Book Store, browse the Map and Atlas Section, and come across a map of the United States that is curiously represented as a Roulette Wheel.

Well, it won't be much longer before that Roulette Wheel is Russian.

Drink Up!

:beer:

[DemReadingDU]

58. or Roulette Wheel is Chinese

Not only do the Chinese make those Roulette Wheels, they have a nation that is mostly males who can be ordered into the military for fighting in future wars.

And the finance bankers are still gambling, because they are not using their money.

[TheWatcher]

80. Delete. Wrong Place.

Oops. :blush:

[KoKo]

70. Sadly I think public backlash was starting to come together and

the media was forced to cover some of what was going on in the Casino for the first time.

Then..."Swine Flu" struck and the Empire has seemed to get a hold of the situation after the "teabaggers" went down pathetically and Cramer is still spewing his stuff along with the Fast Money crowd on CNBC. House & Senate strike down Maloney's bill on Credit Card companies usury practices by sending Durbin out to admit that the Banks/Wall St. own the Senate and they are just powerless to do anything.


Shock & Awe....Shock & Awe....and after awhile people do go into a stupor just to cope.

[antigop]

59. A CDO for your pension fund?

http://www.talkingpointsmemo.com/archives/2009/04/a_cdo_for_your_pension_fund.php

It doesn't have quite the punch of the market collapse and all the hullabaloo surrounding the big national banks. But largely under the radar there's a major unfolding scandal tied to corruption of state pension funds. Basically cases in which hedge funds and other investment firms have buttered up state bureaucrats or elected officials to get their hand on public pension fund money for highly speculative or downright fraudulent investments. It got some high-profile attention when one part of the story ended Gov. Bill Richardson's hopes of being Commerce Secretary. But there's a lot more to the story.

http://tpmmuckraker.talkingpointsmemo.com/2009/04/whos_who_of_paying_to_play.php

In June 1997 Tom Flanigan, the chief investment officer of the California State Teachers Retirement System, wrote a letter to his old mentor, then-SEC chief Arthur Levitt. He was under political pressure, he said, to gamble with teachers' savings. The state comptroller was demanding he allocate a bigger portion of the fund to venture capital firms and hedge funds in what he thought to be an overheated market.

Meanwhile, hedge funds and private equity firms were hiring politically connected "placement agents" to descend upon his board of directors, who had final approval over his investment decisions. He had just watched the Texas investment firm Hicks, Muse, Tate and Furst secure a $100 million investment from the state employees' general retirement fund CalPERS after paying a $750,000 "finders fee" to a former board member and longtime Los Angeles politico named Alfred Villalobos. Villalobos had a questionable history with Hicks -- as a board member he'd already approved another $100 million investment in the firm on the advice of the fund's paid adviser Chris Bower. Nine months later, Bower sold his two-year-old yacht to Hicks founder Tom Hicks for a $45,000 profit. And there was other smoke around the deal, if no clear fire: Villalobo, for one had just filed for personal bankruptcy over gambling debts. And the board had initially rejected the deal -- when another LA politico on the board, a labor leader named Jerry Cremins, changed their minds. There was something "unseemly if not unethical" going on, Flanigan wrote. The SEC proposed rules regulating the placement agencies.

A few months later, Flanigan was sacked.

Wanna bet Texas is part of this, too?

[DemReadingDU]

71. Yeh, those CDOs are everywhere

Municipalities, school districts, pensions. Probably life and health insurance, too. Everyone thought there would be guaranteed a certain percentage of growth, forever. It's really sad, they're all basically worthless now, which means everything is bankrupt. And so few people have woken up to the amount of theft and corruption that has been going on. I wonder in the coming months, what it will be that will cause people to stop believing in the propaganda that is being spinned everywhere today.


Edit: everyone should read your 2nd link
http://tpmmuckraker.talkingpointsmemo.com/2009/04/whos_who_of_paying_to_play.php

[tclambert]

83. Most retired horses get turned into dog food.

Really, shouldn't retiring people just march right into the Soylent Green conversion chambers? If they aren't going to do productive work, what does the Holy Scripture of free market economics say should happen to them?

Weird how Florida and Arizona compete to attract retirees. Apparently, they stimulate the economy without working. They do it just by being consumers. Consumption without production. Almost like Wall Street bankers.

[TheWatcher]

81. BREAKING: Chrysler Near Death, Awaits Last Rites.

AP sources: Chrysler to file for bankruptcy
AP sources: Chrysler to file for bankruptcy protection as credit talks crumble overnight

* Stephen Manning and Tom Krisher, Associated Press Writers
* On Thursday April 30, 2009, 10:40 am EDT

WASHINGTON (AP) -- Chrysler will file for bankruptcy after talks with a small group of creditors crumbled just a day before a government deadline for the automaker to come up with a restructuring plan, two administration officials said Thursday.

The Obama administration had long hoped to stave off bankruptcy for Chrysler LLC, but it became clear that a holdout group wouldn't budge on proposals to reduce Chrysler's $6.9 billion in secured debt, according to the officials, who spoke on condition of anonymity because the filing plans are not public. Clearing those debts was a needed step for Chrysler restructure by the Thursday night deadline.

Bankruptcy doesn't mean the nation's third largest automaker will shut down. And the privately-held Chrysler is expected to sign a partnership agreement with the Italian company Fiat as early as Thursday as part of its restructuring plan. A Chapter 11 bankruptcy filing would allow a judge to decide how much the company's creditors would get.

President Barack Obama is expected to discuss the nation's auto sector at noon Eastern.

http://finance.yahoo.com/news/AP-sources-Chrysler-to-file-apf-15084637.html?sec=topStories&pos=main&asset=&ccode=

Apparent Cause Of Death:

But the administration said about 40 hedge funds that hold roughly 30 percent of that debt also needed to sign on for the deal to go through. Those creditors said the proposal was unfair and were holding out for a better deal.

"While the administration was willing to give the holdout creditors a final opportunity to do the right thing, the agreement of all other key stakeholders ensured that no hedge fund could have a veto over Chrysler's future success," said one of the administration officials.

A third person briefed on Wednesday night's events said the Treasury Department and the four banks tried to persuade the hedge funds to take a sweetened deal of $2.25 billion in cash. But in the end, this person said most thought they could recover more if Chrysler went into bankruptcy and some of its assets were sold to satisfy creditors. This person asked not to be identified because details of the negotiations have not been made public.

And this:

When it files for bankruptcy, Chrysler would continue operating and Fiat would still sign on as a partner on Thursday, the people said. The government already has promised to back Chrysler's warranties in an effort to allay customers' fears that the automaker wouldn't be around to honor them.

Hey, we have Zombie Banks, why not Zombie Automakers! :beer:

But the new Jobless Claims UNEXPECTEDLY DROPPED to Apocalyptic Levels less than expected (We hit a smaller iceberg than we thought we would)!!!!!!!!!!!!!!!!111111111111111111111111

THE RECOVERY IS HERE!!!!!!!!!!!!!!!!!11111111111111

BE WELL CITIZENS!!!!!!!!!!!!!

COCTEAU BE PRAISED!!!!!!!!!!!!!!!!!

[Dr.Phool]

87. Thank Gawd it passed!!!!!

And we gave AIG enough money to pay off those Credit Default Swaps, at full face value, to the very hedge funds that are blocking the deal!

Hey, a shark would rather eat a whole fish than 40% of a fish.

[tclambert]

88. Bankruptcy is not the same as death.

At least, not Chapter 11. Chapter 7 bankruptcy is death--liquidation. Chapter 11 reorganization hurts mostly because customer confidence in the company declines, and that costs market share. But most companies go through Chapter 11 in 3 years, emerging leaner and healthier and profitable. I invested in a bankrupt company once and made a nice return.

Chrysler is expected to go through a special Chapter 11-like bankruptcy, taking only 30 to 45 days. The government will decide how much those stubborn hedge funds get. I hope the hedge funds get burned. Fiat may come out the big winner.

An "expert" on the teevee just now said he expects Chrysler's market share to drop from 10% to 5%. Who gets the 5% they lose? GM might get some, and it may save them from bankruptcy. Or they may face the same process, and a similar loss of market share. Ford and Toyota win. So far today, GM is up about 4%, Ford is up almost 10%, Toyota is up 3%.

[TheWatcher]

89. Understood. :)

And well noted.

I highlighted the note about the Hedge Funds to illustrate who is running the show in this country.

Durbin was right. But it isn't just the Banks. It's ALL the financial Hit Men.

We are being run roughshod over by a bunch of Criminal Mafioso.

And no matter WHAT Offer they Make, We Cannot Refuse, Even If We Want To.

[DemReadingDU]

106. The Automatic Earth : Lukewarm Hot Air

4/30/09
Ilargi at The Automatic Earth discusses Chrysler


Ilargi: I waited to see Obama's Chrysler speech at noon, I figured he'd have something to say. But halle-bleeping-lujah, what a lot of lukewarm hot air nonsense one man can put into a few minutes. I’m sorry, I know he looks like a decent man, but I’m running out of patience. Whatever happened to the promise of transparency?

In case you missed the speech, Chrysler will go through a 3-60 day bankruptcy, or so they hope and say, and Fiat will take over after that, with GMAC providing loans for who wants to buy a Chrysler automobile. The president suggested Americans should buy American cars. How about non-protectionism? How about the fact that Chrysler is evidently NOT an American company anymore?

In this phase of the game, hollow words simply don't do it for me anymore, I understand that for this administration all is like a product to be sold, most of all the president himself. And yes, they're doing a swell job of it. But when it comes to a topic like Chrysler, I want to know a number of things first and foremost, and so should you. Mind you, I'm just shooting from the hip here, I'm sure there''s other issues the president chooses not to address:

1. First of all: Why does the US government meddle in privately held businesses to begin with? In whose interest is this?

2. How much taxpayer money is put at risk? Not partial, no rosy best cases, but the total, and over time. What were the stress tests -if any-, what were their parameters, and what did they say? If the company goes belly-up anyway 2 or 5 years from now, what'll be the people's tab?

3. What are the market projections used in the models the deal will be based on? Obama talks about reviving the US car industry, but that doesn't mean much. Specify: how many million sales per year does that revival predict? 2 million, 5 million, 15 million? This question is crucial for all policies developed today that are -make that should be- designed to keep taxpayers safe going forward. The most pessimistic scenario I’ve seen is 9.5 million sales, and that's not going to happen. That is to say, unless Obama chooses to bury his voters even deeper in debt through state-guaranteed loans (see under 4). And even then 9.5 million will be out of reach, you'd have to give them away like Oprah does. Have the "experts" run a model for 3-4 million annual sales over the next 5 years? Let's see the rundown. It's the people's money that's put at risk, and they have the right to know why, how, when, where and how much.

4. How much money and other assets have been promised to FIAT? And I mean the whole enchilada, all of it, including of course -future- risks committed to by Washington.

5. What has been discussed with the Italian government? What guarantees have come from Berlusconi? What was said about Fiat's recent record losses?

6. What will be the structure of the financing deals designed to enable people to buy Chrysler cars?


Obama mentioned doing the lending through GMAC, but he did not say how. And GMAC, as we know, to put it mildly, is not exactly a picture of financial health.

My fear, which by now borders on near certitude, is that the car industry will be kept on state life support systems in the same way housing and mortgages are. That is to say, just like hardly any homes would be sold or refinanced today without full federal intervention and guarantees, in the form of Fannie and Freddie buying up all loans, no-one would be able to get a car loan without similar state involvement.

So, next up, and very soon, is GM, which is many times bigger than Chrysler. Are we going to see the same lack of transparency, the same lack of accountability? It looks inevitable.

more...
http://theautomaticearth.blogspot.com/2009/04/april-30-2009-1-lukewarm-hot-air.html

[Hugin]

96. "a holdout group wouldn't budge"

Will there be an Investigation of WHY they wouldn't budge... Did they have a vested (conflict of) interest in seeing Chrysler fail? Were their mattresses stuffed with CDSs to that effect? Hmmm?


I only have a guess on the answer to one question...

Will we ever know?

No.

[tclambert]

91. GM bondholders launch counter-offer --Financial Times (London)

By John Reed in London Published: April 30 2009 14:24 | Last updated: April 30 2009 16:25

http://www.ft.com/cms/s/0/c0f4b0fc-3587-11de-a997-00144feabdc0.html?referrer_id=yahoofinance&ft_ref=yahoo1&segid=03058&nclick_check=1

General Motors’ bondholders on Thursday launched a counter-offer to the carmaker’s debt exchange proposal made earlier this week that would see them claim majority control of the company, but the US federal government hold no shares. GM’s ad hoc bondholders’ committee said they would be willing to swap their $27bn of notes for 58 per cent of the carmaker’s shares. The plan would see a healthcare fund managed by the United Auto Workers’ union own 41 per cent of “the new GM” and current shareholders retain 1 per cent of Detroit’s largest carmaker. . . .

GM’s exchange offer, made on Monday, proposed that bondholders swap their paper for 10 per cent of the company. The carmaker’s proposal would see the government take majority control in exchange for retiring $10bn of emergency loans made since December. GM’s remaining shares would mostly be owned by the UAW.

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

GM offers 10%, they ask for 58%. Pretty far apart. Chrysler's bankruptcy may change the numbers quite a bit. The bondholders' proposal would leave current shareholders with only 1%. And that's why my wife and I changed our minds about investing in GM. Going from $30/share to $2/share made them look tempting. If they survive, the share price could go back up to the equivalent of $15-$20/share in a few years time. Maybe a factor of 10 increase. But if you only get 1% of that, you'd lose by a factor of 10.

[tclambert]

95. Obama on Chrysler:

1) Fiat and Chrysler have agreed to a partnership.
2) Chrysler will file for Chapter 11 bankruptcy.
3) But it will be a very fast bankruptcy.
4) Agreements previously reached with the UAW, Fiat, Daimler, and several major banks will likely become the basis for the bankruptcy reorganization.
5) The hedge funds who held up the deal apparently sought twice the return of anyone else.
6) Obama called out the hedge funds, said he's on the side of everybody else.
7) Obama praised Nardelli (Chrysler CEO), Fiat, Daimler, the UAW, the CAW (Canadian Auto Workers), and JP Morgan Chase for their efforts.

He strongly implied, but didn't explicitly say, that the previously reached agreements with the banks, unions, and Fiat will be the basis for the bankruptcy. The purpose for the bankruptcy is solely to deal with the holdouts, the hedge funds who wanted a better deal at taxpayer expense. And it sounds like he wants to pound them. He tried to reassure potential customers that bankruptcy won't ruin Chrysler, and the government has guaranteed their warranties. Chrysler will survive.


I hope those hedge funds get screwed. They won't get any more than other creditors and forcing the Chapter 11 will hurt Chrysler's market share. Since they are the sole cause of that loss of business, they should get less than anyone else.

[Hugin]

97. "they should get less than anyone else."

Since the thumb-screws are presently out-of-favor.

Here's to them getting nothing... :toast:

[TheWatcher]

103. They should get LESS than nothing.

They have robbed, looted, and stolen enough.

[tclambert]

98. GM went up sharply just after Obama's statement on Chrysler.

But not Ford nor Toyota. They look steady. Looks like Fiat went down. Oh, and it looks like GM's movement might have been just a momentary spike.

[TheMachineWins]

100. Milan Police Seize UBS, JPMorgan, Deutsche Bank Funds

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

----- April 28 (Bloomberg) -- Milan’s financial police seized 476 million euros ($620 million) of assets belonging to UBS AG, Deutsche Bank AG, JPMorgan Chase & Co. and Depfa Bank Plc amid a probe into alleged fraud linked to the sale of derivatives.

The police froze the banks’ stakes in Italian companies, real estate assets and accounts, the financial police said in a statement today. The assets seized yesterday also include those of an ex-municipality official and a consultant, the police said.

The City of Milan is suing the four banks after it lost money on derivatives it bought from the lenders in 2005. The securities swapped a fixed rate of interest on 1.7 billion euros of bonds for a variable rate that was losing the city 298 million euros as of June. Milan is among about 600 Italian municipalities that took out 1,000 derivatives contracts worth 35.5 billion euros in all, the Treasury said. -----


My two cents: Why Italy? Because they know how to deal with organized crime.

[Dr.Phool]

104. The US media finally reported it huh?

I posted this from Denniger yesterday. He had it 2 days ago.


http://market-ticker.denninger.net/archives/2009/04/28.html

The Italians are getting into the act:

With municipal bond investigations spreading to Europe from the United States, Italian authorities have seized about $300 million in assets of four global banks — JPMorgan Chase, Deutsche Bank, UBS and Depfa — whose officials have been accused of fraud.

The Guardia di Finanza in Milan, the financial police of Italy, took over real estate properties, bank accounts and stock holdings on Monday to assure it could collect from the banks if their officials were found guilty and the banks were held responsible.

Dozens of state and local governments in the United States have been victimized by these "deals" in the United States as well, yet Italy is the first to bring an actual enforcement action and seize assets? Why?

Lawless behavior by both Wall Street executives and government officials appears to have been pervasive, it is outrageous, and hundreds of billions (if not trillions) of dollars has been stolen from the taxpayer as a direct result.

The people involved appear to have known full well they were doing something wrong at the time as they have made every attempt to hide their actions and refuse to ask the tough questions; if you're not slithering around with the intent of a viper there is no reason not to act in the light of day!

Those alleged to be involved must be investigated, indicted, tried, and if found guilty imprisoned with their assets subject to fine and forfeiture, no matter who they are.

[DemReadingDU]

102. Kiplinger: Probable tax hikes coming in 2011

4/24/09

1. Think Taxes Are Too High Now?
Just wait: Congress is all but certain to raise them a couple of years from now. Tax increases will hit both businesses and individuals -- and not just singles making more than $200,000 a year and married couples over $250,000 a year. They'll be the first to get pinched, but not the last. There's just not enough revenue that can be drawn from the wealthy without crippling the economy, so in time, middle incomers will feel a bigger bite, too.

2. Boosts in top marginal rates from 33% and 35% to 36% and 39.6%. No change in the other marginal rates seems likely.

3. A higher rate on capital gains and dividends, but only for those in the top brackets. They will probably be hit with a 20% rate, though it could go a little higher.

4. Caps on itemized deductions for top earners. Obama's push to limit the value of deductions at 28% ran into a wall of opposition from charitable groups, but he's not giving up. Some way of curtailing the tax break still seems likely by 2011.

5. No repeal of estate taxes, but count on an exemption of at least $3.5 million, and it could be set as high as $5 million if the Senate prevails. Estate tax legislation will include spousal transfers, making the exemption $7 million or more for couples. The estate tax rate will be capped at 45%, the same as it is now.

6. More easings for the alternative minimum tax, but no repeal.
What about businesses? Businesses can expect a mixed bag of hikes and cuts, but with a higher total tax bill. Click through to see some of the changes expected.

7. Higher SECA taxes for owners of S firms and partnerships by blocking them in the future from skirting payroll taxes by taking their compensation as dividends instead of salary.

8. New restrictions on worker classification to make it easier for the IRS to crack down on firms that treat workers as contractors who are really employees.

9. An elimination of some tax breaks for big corporations, including the deduction for domestic production, accelerated depreciation and incentives for foreign income and oil production.

full article...
http://content.kiplinger.com/businessresource/forecast/archive/tax_hikes_coming_in_2011_090424.html