STOCK MARKET WATCH, Friday June 12

[ozymandius]

Source: du

STOCK MARKET WATCH, Friday June 12, 2009

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

AT THE CLOSING BELL ON June 11, 2009

Dow... 8,770.92 +31.90 (+0.37%)
Nasdaq... 1,862.37 +9.29 (+0.50%)
S&P 500... 944.89 +5.74 (+0.61%)
Gold future... 961.50 +6.80 (+0.71%)
10-Yr Bond... 3.86 -0.09 (-2.18%)
30-Year Bond 4.69 -0.07 (-1.47%)

---

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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---

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

Read more: du

[ozymandius]

1. Market Observation

Lack of Transparency in Fed Balance Sheet and Liquidity Programs
BY MIKE SHEDLOCK

Inquiring minds are investigating statements made by Ben Bernanke regarding Federal Reserve Credit and Liquidity Programs.

"The Federal Reserve strongly believes in transparency as a fundamental principle of central banking in a democracy. This new report, together with other steps taken as a result of a comprehensive review of our disclosure practices led by Vice Chairman Kohn, significantly enhances the information Federal Reserve is releasing and should help the public and the Congress better judge how we are carrying out our responsibilities for stabilizing the financial system and the economy," said Board Chairman Ben S. Bernanke. "We will continue to look for opportunities to broaden the scope of information and analysis we provide."

If the Federal Reserve believed in transparency, then why did Bloomberg have to file various freedom of information lawsuits against the Fed?

....

The evidence against Paulson and Lewis is massive. Please see Let the Criminal Indictments Begin: Paulson, Bernanke, Lewis for details.

....

Questions, Questions, Questions

* What is the current market value of the Fed's holdings?
* Who did the Fed swap with?
* In what amounts?
* Don't taxpayers have a right to know?
* When is the Fed going to be audited?
* Since the parameters of the Stress Test were horribly wrong, are we going to see another stress test? With better disclosure this time?
* What is the exit strategy?

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

[ozymandius]

14. From Shedlock's indictment argument:

New York State Attorney General Andrew Cuomo's letter to the SEC and Senate Banking Committee on the Bank of America, Merrill Lynch Merger provides strong evidence of coercion to commit securities fraud by former Treasury Secretary Paulson and Fed Chairman Ben Bernanke, and actual securities fraud by Bank of America CEO Kenneth D. Lewis.

At issue is Lewis's decision to back away from the merger deal with Merrill Lynch on a MAC (material adverse change) clause because of rapidly deteriorating conditions at Merrill Lynch.

-see large excerpt from article-

Coercion To Commit Securities Fraud

It's crystal clear from the letter that a strong case can be made that Paulson and Bernanke coerced Lewis to carry out a merger agreement that was not in Bank of America's shareholders best interest. Lewis arguably did so only to save his own job and the board.

---

This smells like seven different kinds of funky. We regulars here know that most decisions weighing in capital markets are done so to maintain appearances of functionality and for the ulterior agenda of political leverage. The participants here (Bernanke, Lewis, Paulson (and maybe Geithner)) appear, at face value, to operate comfortably in a realm in which they consider themselves above the law.

[Demeter]

43. OOOH! This Is Gonna Be Some Weekend!

You think these mugs are playing to us? 3 stooges indeed!

[Roland99]

19. Morning, ozy (and howdy SMWers!)

That first line nearly had me on the floor!

Guess it depends on how one defines transparent. I suppose heavily tinted glass is technicaly transparent.

Hope everyone's doing well. Orlando is treating me rather well so far (save an attempted break-in of my car - nothing taken...just a broken window that was replaced for free. whew!) My daughter is here for a few weeks now (YAY) and returns in early August to stay permanently (showed her her high school last night)

Still hearing that the job market back in Louisville is all but dead, at least for IT. Glad I made the jump out-of-state.

Hopefully I can pipe in a bit more in the mornings soon (or on lunch breaks...I'm only 6-7min from home. nice!)

:hi:

[UpInArms]

22. Hiya Roland!

So glad to hear your good news and to "see" you here this fine day!

Will look for you to be chiming more frequently :)

:grouphug:

[ozymandius]

23. Good morning Roland.

:donut: :donut: :donut:

Isn't that first line just so rich? The hypocrisy is so thick - one could sell it by the slice.

Thank you for checking in here. It's always a pleasure to hear such good news, especially after so much tumult.

:hi:

[Hugin]

35. Heyas Roland.

:hi:

[Demeter]

44. Congrats on Landing Sunny Side Up!

You inspire us!

[Roland99]

50. Aww, shucks

t'weren't nuthin'

Just 3 months of gnashing of teeth and fret and worry. That's all. But...I recommend everyone else try and avoid it.

For now, I'm taking my daughter to Disney this weekend! :-)

[tclambert]

62. Glad to hear things have improved for you.

With the job market the way it is, I was afraid you might have to move to Bangalore.

[ozymandius]

2. Today's Reports

08:30 Export Prices ex-ag. May
Briefing.com NA
Consensus NA
Prior -0.3%

08:30 Import Prices ex-oil May
Briefing.com NA
Consensus NA
Prior -0.7%

09:55 Mich Sentiment-Prel Jun
Briefing.com 70.5
Consensus 69.5
Prior 68.7

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

[rfranklin]

4. U.S. Consumer Confidence Likely Rose for a Fourth Month in June

U.S. Consumer Confidence Likely Rose for a Fourth Month in June
By Courtney Schlisserman

June 12 (Bloomberg) -- Confidence among U.S. consumers probably rose for a fourth straight month in June, reflecting signs that the worst recession in at least five decades may end this year, economists said before a private report.

The Reuters/University of Michigan preliminary index of consumer sentiment increased to 69.5, the highest level in nine months, according to the median estimate of 62 economists in a Bloomberg News survey. The final reading for May was 68.7.

Job losses are slowing, recent reports show housing and manufacturing -- the two worst parts of the economy -- are stabilizing, and the Obama administration’s fiscal stimulus may help shore up consumer demand. Still, a record loss of wealth is causing Americans to boost savings, and unemployment is forecast to keep rising, so a recovery will be slow to take hold.

“I don’t think consumers are prepared as yet to bet the farm,” said Michael Gregory, a senior economist at BMO Capital Markets in Toronto. While recent data have been encouraging, he said, the economy is in a pattern of “cautious gains.”


http://www.bloomberg.com/apps/news?pid=20601087&sid=a9_IvbYbdq7o

[UpInArms]

20. May export prices rise 0.6% - U.S. import prices rise 1.3%, most since July

U.S. May import prices rise 1.3% on petroleum
8:30am Today

U.S. May nonfuel import prices rise 0.2%
8:30am Today

U.S. import prices down record 17.6% in past year
8:30am Today

U.S. May imported oil prices up 8.3%
8:30am Today

U.S. May export prices rise 0.6%
8:30am Today

U.S. import prices rise 1.3%, most since July
8:30am Today

[UpInArms]

53. UMichigan consumer sentiment rises to 69 in June (from 68.7 in May)

UMichigan consumer sentiment rises to 69 in June
9:56am Today

be still my heart! look at that jump!

:sarcasm:

http://www.marketwatch.com/story/consumer-sentiment-rises-slightly-in-june

WASHINGTON (MarketWatch) -- U.S. consumer sentiment rose slightly in June from the prior month though it remained at relatively low levels, according to a survey released Friday by the University of Michigan and Reuters.

The report diverges from prior readings that showed consumers are perking up due to future expectations rather than their current state. Friday's report indicates that higher prices for gas and continued job losses are dampening optimism about consumers' present circumstances, analysts said.

"The flip in these readings which showed some pullback in expectations is partly related to the ongoing weakness in the labor market which continues to be incredibly difficult for those individuals that have lost a job in the past year, depressing expectations about the future," wrote Dan Greenhaus of the equity strategy group at Miller Tabak.

The consumer sentiment index rose to 69 in mid-June from 68.7 in May. Economists surveyed by MarketWatch were looking for a June result of 71. The index hit a 28-year low of 55.3 in November, and has averaged 88.2 over the last 10 years.

Consumers' views on current conditions rose in June to 74.5 from 67.7 in May. Meanwhile, their expectations fell to 65.4 from 69.4. Consumers' expectations for one-year inflation rose to 3.1% from 2.8%.

...more...

[ozymandius]

3. Oil holds above $72 as economic recovery eyed

SINGAPORE – Oil prices held above $72 a barrel Friday in Asia, just below an 8-month high, as investors eyed signs a global recession may be easing.

Benchmark crude for July delivery fell 62 cents to $72.06 a barrel by late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. On Thursday, it rose $1.35 to settle at $72.68, the highest since October.

An improving crude demand outlook helped bolster prices. On Thursday, the International Energy Agency in Paris said in its monthly survey that global oil demand would fall by 2.9 percent this year, better than its May forecast of a 3 percent annual fall.

....

The Labor Department on Thursday reported that the number of newly laid-off Americans filing for jobless benefits fell last week by 24,000 to 601,000 — better than economists had forecast.

....

In other Nymex trading, gasoline for July delivery fell 1.64 cents to $2.05 a gallon and heating oil dropped 1.05 cents to $1.84. Natural gas for July delivery slid 3.0 cents to $3.90 per 1,000 cubic feet.

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

[rfranklin]

6. Oil retreats after three-session climb...

Jun 12, 2009, 1:34 a.m. EST


Oil retreats after three-session climb
By Myra P. Saefong, MarketWatch
TOKYO (MarketWatch) -- Oil futures headed lower early Friday in electronic trading on Globex, poised to end a winning streak that spanned three sessions and lifted prices by nearly 7%.

Crude for July delivery fell to as low as $72.20 a barrel on Globex, though moved back slightly to trade at $72.46 in the Asian midday.

On Thursday, the contract briefly touched high a fresh seven-month high above $73 after the International Energy Agency raised its forecast for world oil demand and as upbeat economic data in the U.S. boosted economic hopes.

"This month's oil market reports suggest that the worst might be over, but we would still argue that current price levels are not fully justified by fundamentals," analysts at Credit Suisse wrote in a research note Friday.

http://www.marketwatch.com/story/story/print?guid=C058B4C4-75C3-4832-AB08-A1E872936C32

[ozymandius]

7. Oil Drops After Record Plunge in European Industrial Production

June 12 (Bloomberg) -- Oil fell for the first day in four as a record plunge in European industrial production prompted speculation that hopes for an economic recovery are premature.

Oil declined as the U.S. dollar strengthened, undermining investors’ need to use commodities as an inflation hedge. The relative strength index for New York oil futures, a measure of how rapidly prices have advanced or dropped during a specific period, indicates prices may fall. U.S. crude inventories remain 11 percent above their five-year average, according to the Energy Department.

“The market has excessively priced in the idea that a demand recovery is imminent,” said Eugen Weinberg, an analyst with Commerzbank AG in Frankfurt. “Upbeat sentiment might drive prices higher in the short term, but later in the summer fundamentals will play a larger role and a massive price correction is likely.”

.....

European industrial production dropped by the most on record in April as the worldwide recession ravaged demand for goods. Production in the euro region plunged 21.6 percent from a year earlier, the most since the data series started in 1986, the European Union’s statistics office said today. Economists expected a 19.8 percent decline, according to a Bloomberg News survey. From March, output declined 1.9 percent.

http://www.bloomberg.com/apps/news?pid=20601082&sid=aGFHVCK2eDJc

[burf]

37. After to the Corporate Media

this morning, I thought the strong dollar was the reason behind the oil price drop. There was no mention of the lousy produation numbers.

More of the same from the media. But, in their defense, why should they change now?

[ozymandius]

5. Lawmakers blast Fed, Treasury, BofA over Merrill

WASHINGTON (Reuters) – U.S. lawmakers accused the Treasury and Federal Reserve on Thursday of using threats to force Bank of America (BAC.N) to take over Merrill Lynch while criticizing Bank of America boss Ken Lewis for keeping shareholders in the dark about rising losses at Merrill.

At a hearing into the deal, brokered hastily during the worsening U.S. banking crisis in late 2008, lawmakers were torn over whether regulators exceeded their authority to enforce the marriage or had been browbeaten by Lewis into providing government aid to support the acquisition.

"The Treasury Department had provided a $20 billion dowry for a shotgun wedding," said House Oversight and Government Reform Committee Chairman Adolphus Towns, a Democrat. "But the question may be, 'Who was holding the shotgun?'"

.....

Lewis said he did not recall seeking a letter ordering Bank of America to go forward with the deal, despite Kucinich citing Fed emails appearing to discuss such a request. Lewis said he remembered a request for something in writing about government assistance to do the deal.

http://news.yahoo.com/s/nm/20090611/bs_nm/us_bankofamerica_congress

[ozymandius]

11. Fed Emails Bash BofA Chief

Excerpts:

“… Ken Lewis’ claim that they were surprised by the rapid growth of the losses seems somewhat suspect. At a minimum, it calls into question the adequacy of the due diligence process BAC has been doing in preparation for the takeover.”

–Dec. 19 email from Timothy Clark, senior advisor in the Fed’s division of banking supervision and regulation, to Warsh, Kohn and others.

* * *

“… the recent decline in BAC’s projected year end 2008 stand alone number appears to be driving as much of the decline in the combined pro forma ratios as the losses at ML, even as they are portraying the losses ML as being the key issue here.”

–Dec. 19 email from Timothy Clark.

* * *

“… BAC management told us they could not provide electronic versions of ML files, and one wonders how that is possible since they have been doing the due diligence for months and having e-files would have made that much simpler and more effective for them. May have helped limit their current surprise.”

–Dec. 19 email from Timothy Clark

* * *

“Merrill is really scary and ugly.”

–Dec. 21 email from Malcolm Alfriend, senior vice president of Fed Bank of Richmond, to various federal officials.

* * *

“I think the threat to use the MAC is a bargaining chip, and we do not see it as a very likely scenario at all. Nevertheless, we need some analyses of that scenario so that we can explain to BAC with some confidence why we think it would be a foolish move and why regulators would not condone it.”

–Dec. 21 email from Chairman Bernanke to some Fed officials

* * *

“Just had a long talk with Ben. Says they think the MAC threat is not credible. Also intends to make it even more clear that if they play that card and then need assistance, management is gone.”

–Dec. 21 email from Federal Reserve Bank of Richmond President Jeffery Lacker to other Fed employees regarding a conversation he had with Bernanke.

more at The Big Picture

[snot]

15. Just to say, great work here and everywhere; thank you so much.

[ozymandius]

17. You're welcome. And thank you for the high compliment.

:hi:

[ozymandius]

12. Ken Lewis points the finger at Bernanke and Paulson (by Edward Harrison)

....
Just yesterday, it was revealed that Fed officials called Lewis “reckless” in internal e-mails. The Republican party is running with this and looking to make trouble for Bernanke and the Fed. Given the fact that Bernanke is up for re-appointment, these events could have a material impact on the Obama Administration’s desire to keep him on. The last two Fed Chairmen, Greenspan and Volcker were appointed by a President of one party, but subsequently kept on by the next President of another party. If Bernanke goes, we could expect Larry Summers to be a top candidate for the Fed Chairman role.

As for Lewis, he argues that the Countrywide and Merrill acquisitions were in the country’s and in Bank of America’s best interest. Below is the video of Lewis on Capitol Hill making his opening statements before Congress.

My take here is that the Bank of America case has become very political – and that means the blame game is going to be played. Someone -- Bernanke, Lewis, Thain or Paulson -- is going to take the fall. The knives are out.

Read more here and see Ken Lewis's red face in the accompanying video.

[Demeter]

45. Oh, Let's Be Frivolous! Take Out All Four of Them

It will save time AND money.

[ozymandius]

8. GM Appears to Close In On a Deal to Sell Saab

DETROIT -- A deal to sell General Motors Corp.'s Saab Automobile AB could come as soon as Friday, people familiar with the situation said Thursday, signaling the company is close to resolving a critical loose end in its global restructuring.

GM is "very close" to cutting a preliminary deal to offload Sweden-based Saab, but it hasn't yet reached a final agreement, a person familiar with the deal said.

The comments came as Swedish TV station SVT reported that Saab had agreed to be sold to Swedish exclusive sports-car maker Koenigsegg Automobile AB.

....

In a clear sign the Saab is close to finding a new owner, the Swedish government said Thursday it will start negotiating a loan guarantee with the car maker. The government said it has decided to let its National Debt Office start formal discussions about the state guaranteeing a €500 million ($700 million) loan that Saab has supplied for with the European Investment Bank.

http://online.wsj.com/article/SB124477811150809185.html?mod=googlenews_wsj

[ozymandius]

9. World Bank Predicts Deeper Economic Contraction

The global economy is set to shrink this year more than previously expected, according to a forecast issued yesterday by the World Bank.

The bank predicted that the economy will contract at an annualized rate of 3 percent, far worse than the previous estimate of 1.7 percent issued in March. The forecast, which was prepared ahead of this weekend's meeting in Italy of the finance ministers from the eight leading industrialized countries, reflects a widespread view among economists that while the global recession is easing, it remains severe.

Worldwide economic conditions have changed somewhat since the G-8 finance ministers last met in February, with tentative signs of improvement in several member countries.

....

Developing nations have been hard-hit by a steep drop in demand for exports, the flight of foreign investment and a decline in remittances. They don't have as much financial wherewithal as developed nations, or the ability to borrow as much money to fund stimulus spending. Falling revenue has made it harder for them to service their debt.

http://www.washingtonpost.com/wp-dyn/content/article/2009/06/11/AR2009061104254.html

[ozymandius]

10. Sources: Banks will start repaying TARP next week

Banks will be able to start repaying federal bailout money on Wednesday, according to two people familiar with the talks between the banks and the government.

Morgan Stanley, and possibly JPMorgan Chase & Co., are among the institutions expected return their federal funding next week, these people said on Thursday, speaking on condition of anonymity because the talks are confidential.

....

Returning the TARP money will free the firms from limits on executive pay that the banks had protested, as well as the high dividends that the companies must pay for the federal financing.

http://www.businessweek.com/ap/financialnews/D98OOBQO0.htm

[tclambert]

13. Any explanations for this one?

2 Japanese carrying $134 bil worth of U.S. bonds detained in Italy

Thursday 11th June, 06:18 AM JST

ROME —

Two Japanese nationals were detained by Italian financial police last week after trying to enter Switzerland with $134 billion worth of undeclared U.S. bonds, mostly Treasury bonds, an Italian daily said Wednesday. The Japanese consulate general in Milan confirmed that the detention had taken place and said it was trying to confirm with Italian authorities whether the two were indeed Japanese nationals and their identities.

According to the report in il Giornale, two unidentified Japanese in their 50s concealed the bonds, including 249 U.S. Treasury bonds each worth $500 million, in a suitcase with a false bottom that was searched by the Italian authorities June 3 when they were in Chiasso, at the border with Switzerland, about 50 kilometers north of Milan. The daily did not say on what charges they have been detained, but the two may have been detained on suspicion of attempting to take a large amount of securities out of Italy without declaring it because the paper said they had not declared the bonds.

http://www.japantoday.com/category/crime/view/2-japanese-carrying-134-bil-worth-of-us-bonds-detained-in-italy
______________________________________________________________

Doesn't seem like the way to conduct a normal bank transfer. Of course, every time I travel with $134 billion in a false bottom suitcase, you know I'm up to no good. Sounds like somebody's in trouble for something. And they will not want to face the boss after screwing up their handling of $134 billion. He's gonna ask questions, like, "249? I gave you 250! Where's the other one? Did you lose $500 million? You lost the whole $134 billion? I'M DOCKING YOUR PAY!"

[ozymandius]

16. That was PM'd to me and I saw the link this morning to the same article.

Should this turn out to be a true case of smuggling Treasury bonds, among others, then I would not want to be in the same room with these guys when the boss "addresses" them. Sure, like you, when I travel with hundreds of billions of dollars of T-notes in the false bottom of my suitcase, I always have a little scratch in my pocket to divert the customs agent's attention away from my schemes.

I don't know what to make of this one. Looks like it could be another nothing or maybe it could be Woodward and Bernstein moment awaiting daylight.

[willing dwarf]

26. How might this tie to you theory Ozy?

I believe the other day you were speculating about the possibility of T Notes becoming the next bubble? Or am I way out in left field with this? Would this incident tie to that at all? Or could this be the sort of hype which begins the credibility of the whisper campaign that T Notes are going to be hot?

Makes me realize I like to watch the set up for a sting, so long as I don't get stung.

[ozymandius]

33. To be honest, I don't know how this incident would tie into my theory.

This incident, which I've yet to see reported on other sites, could be an outlier incident. I have questions about this: Are these notes legit? Or are they counterfeit? What was their point of origin? What was their destination? How does one transport Treasury notes from place to place when they are either bartered or sold? Could this transport of notes possibly be legit? That's for starters.

As for my theory: short term notes are the most frequently traded T-note. Investors have eschewed the 10-year and 30-year bonds. Even the Fed's attempt to buy T-notes has not had an affect on the yield (it's continued to rise - 'cept for yesterday's big drop) on the whole. The thing about bonds, with their inverse price/demand behavior relative to stocks, is that they should drop in yield with an increase in demand. That has not happened with any conviction during this period of Quantitative Easing orchestrated by the Fed and Treasury. The first inkling of this theory occurred when the Fed was caught out in the open, having just purchased massive amounts of T-notes, and yet the bond market revolted with a 180 degree reversal in its typical behavior.

I am still looking for evidence either to confirm or dispel my notions about this. But right now, the psychology of the bond market evidences behavior consistent with a lack of confidence in current policy and process.

[UpInArms]

34. I am certain this is completely unrelated, but it's a funny coincidence - G8 Meeting in Italy to

discuss US Bonds

Rising bond yields on radar as G8 ministers meet

http://www.marketwatch.com/story/rising-bond-yields-on-radar-as-g8-ministers-meet

LONDON (MarketWatch) - Rising interest rates threaten to undermine any potential economic recovery unless the world's most powerful finance ministers convince bond traders that they'll put the brakes on massive stimulus measures before inflation becomes a threat, economists said.

Finance ministers from the Group of Eight nations meet Friday and Saturday in the southern Italian city of Lecce as they attempt to lay groundwork for the meeting of G8 heads of state at their summit next month.

"We expect the G8 finance ministers ... to come out of their confab with some sobering language and proposals that will chill out overanxious fixed income markets," said Carl Weinberg, chief economist at Valhalla, N.Y.-based High Frequency Economics, in a research note.

"Most importantly, the G8 will have to discuss credible plans for reining in both fiscal and monetary stimulus when and if the economies start to grow again," he said.

The G8 includes the United States, Japan, Germany, France, Italy, Great Britain, Canada and Russia. The meeting won't include central bankers. Currency issues aren't expected to be on the agenda.

...more...

[AnneD]

59. The smuggled TBonds....

were to go in the goodie bag (along with samples of the missing Canadian Bullion) that everyone gets to take home with them after the summit...get with the program man :snapsfingerstapsfoot:

[ozymandius]

60. Setser: Who bought all the recently issued Treasuries?

From Brad Setser at Follow the Money: Just who bought all the Treasuries the issued in late 2008 and early 2009?

... the Fed’s flow of funds data leaves little doubt that — at least during the first quarter — the rise in public borrowing was fully offset by a fall in private borrowing.

...

Who bought all the Treasuries the US government has issued in the last four quarters of data (q2 2008 to q1 2009)? Foreign demand for Treasuries — as we have discussed extensively — hasn’t disappeared, unlike foreign demand for other kinds of US debt. But foreign demand hasn’t increased at the same pace as the Treasury’s need to place debt. The gap was filled largely by a rise in demand for Treasuries from US households.

http://www.calculatedriskblog.com/2009/06/setser-who-bought-all-recently-issued.html

[DemReadingDU]

31. Denninger: Smuggling Or Counterfeit-Printing?

6/11/09


Ok, this was rumored several days ago, but now I can find actual news reports - at least, outside the US:

Milan (AsiaNews) – Italy’s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.

Those sound like Bearer Bonds - at least the Kennedy ones do.

We no longer issue those (nor does pretty much anyone else) for obvious reasons - they're essentially money and can be had in VERY large size, making them great vehicles for various illegal enterprises.

But folks: This is $134.5 billion dollars worth.

If they're real, what government (the only entity that would have such a cache) is trying to unload them?

If they're fake, this is arguably the biggest counterfeiting operation ever, by a factor of many times. I've seen news about various counterfeiting operations over the years that have made me chuckle, but this one, if that's what it is, is absolutely jaw-dropping.

The cute part of this is that if the certificates are real Italy just got a hell of a bonanza - their money laundering laws provide for a statutory 40% penalty for failure to declare instruments and cash in excess of $10,000 Euros, which means they'd garner a close-to-$40 billion dollar windfall.

That ought to help their budget problems!

Notice, by the way, that the US Media has totally ignored this story - even though the securities in question are allegedly US instruments.

Gee, I wonder why? Might the authorities know they're real and be just a wee bit nervous that disclosure of a sovereign attempting to covertly dump nearly $140 billion in debt could cause a wee bit of panic, given that we're running nearly $200 billion a month in deficits?

Inquiring minds want to know what's really going on here.
http://market-ticker.org/archives/1114-Smuggling-Or-Counterfeit-Printing.html


6/8/09 US government securities seized from Japanese nationals, not clear whether real or fake
http://www.asianews.it/index.php?l=en&art=15456&size=A

[DemReadingDU]

32. Bloomberg: Japan Probes Report Two Seized With Undeclared Bonds

Finally reported in U.S.


6/12/09 Japan Probes Report Two Seized With Undeclared Bonds

By Shunichi Ozasa and Makiko Kitamura

June 12 (Bloomberg) -- Japan is investigating reports two of its citizens were detained in Italy after allegedly attempting to take $134 billion worth of U.S. bonds over the border into Switzerland.

“Italian authorities are in the midst of the investigation, and haven’t yet confirmed the details, including whether they are Japanese citizens or not,” Takeshi Akamatsu, a spokesman for the Ministry of Foreign Affairs, said by telephone today in Tokyo. “Our consulate in Milan is continuing efforts to confirm the reports.”

An official at the Consulate General of Japan in Milan, who only gave his name as Ikeda, said it still hasn’t been confirmed that the individuals are Japanese. “We are in contact with the Italian Financial Police and the Italian Public Prosecutor’s Office,” Ikeda said by phone today.

The Asahi newspaper reported today Italian police found bond certificates concealed in the bottom of luggage the two individuals were carrying on a train that stopped in Chiasso, near the Swiss border, on June 3.

The undeclared bonds included 249 certificates worth $500 million each, the Asahi said, citing Italian authorities. The case was reported earlier in Italian newspapers Il Giornale and La Repubblica and by the Ansa news agency.

If the securities are found to be genuine, the individuals could be fined 40 percent of the total value for attempting to take them out of the country without declaring them, the Asahi said.

The Italian embassy in Tokyo was unable to confirm the Asahi report.

http://www.bloomberg.com/apps/news?pid=20601101&sid=ayy1QKcwcGN0

[Hugin]

36. Very odd, indeed.

The amount ($134.5 billion) kind of precludes it being any sort of drug deal. Must've been buying a car company or it had something to do with oil.

Boy, I'd like to know the details on this one... Who were these guys and who did they work for? Obviously, they had something to hide. Haha! Like 134.5 billion bucks.

Edit to add the 0.5 Billion I missed... That's $500 Million to regular folks like us. If those were years instead of Dollars, that's longer than there has been higher life forms on earth.

[UpInArms]

40. look at gold and silver dropping

maybe they were on their way to a "buy"

:shrug:

[Dr.Phool]

38. Berlusconi's divorce settlement?

[tclambert]

52. I don't buy counterfeiting.

You have to know any form of money in denominations that big demands painstaking verification. Counterfeiters hardly ever do 1000 dollar bills. Where would you pass them? And anybody who received one would ask, "Is this real?"

If you present a $500 million dollar certificate, no one would accept it without microscopic scrutiny from multiple experts.


It might be an interesting twist, though, if the receiving party said, "These are fake," when in fact they were legitimate. What interesting accusations and counter-accusations that could cause.

[Hugin]

39. My advice to them...

Don't try to negotiate with the boss while standing on plastic sheeting.

I picked up that bit of wisdom from a movie I saw once. Seems like good advice... But, as I've never been caught with $134.5 Billion in bonds in my suitcase, I'm really not sure what kind of advice would be useful to people in that situation.

I do so try to be helpful.

[tclambert]

51. "Lethal Weapon 2" which begins with the discovery of hidden Kruggerands.

Arjen Rudd: Mind the plastic. I'm having some painting done. Well now, the important thing is, are you all right? Any broken bones?
Hans: I'm fine, thank you, Mr. Rudd.
Arjen Rudd: Only a few bumps and bruises, eh?
Hans: Yes, that's all.
Arjen Rudd: Good, good.
(pause)
Arjen Rudd: However, we did lose over a million dollars in Krugerrand.
Hans: I know. I'm sorry, Mr. Rudd. It happens.
Arjen Rudd: Ah, it's not your fault. Sometimes these things do not go as planned. As you say, they just happen... eh, Pieter? (Pieter shoots Hans. He falls dead onto the plastic, and Pieter starts wrapping its edges around his body)
Pieter Vorstedt: You give a new meaning to the phrase "drop-cloth," Mr. Rudd.


And later . . .


Arjen "Aryan" Rudd: Mr. Getz got away. A missed opportunity and he gets away. He slips right through our fingers, and into the hands of the police.
(catches Pieter staring at the floor around him)
Arjen "Aryan" Rudd: What are you doing?
Pieter Vorstedt: I was just checking to see if I was standing on plastic.

[Hugin]

41. Hmm... and UBS has been awfully quiet lately.

Too quiet.

[Demeter]

46. MORE: Smuggling Or Counterfeit-Printing?

Smuggling Or Counterfeit-Printing? US government securities seized from Japanese nationals, not clear whether real or fake

http://blueskysunshine.org/blog/?p=1707

The Bonds were NOT declared and were hidden in a compartment in the suitcase. see below:

Ok, this was rumored several days ago, but now I can find actual news reports - at least, outside the US:

Milan (AsiaNews) – Italy’s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.

Those sound like Bearer Bonds - at least the Kennedy ones do.

We no longer issue those (nor does pretty much anyone else) for obvious reasons - they’re essentially money and can be had in VERY large size, making them great vehicles for various illegal enterprises.

But folks: This is $134.5 billion dollars worth.

If they’re real, what government (the only entity that would have such a cache) is trying to unload them?

If they’re fake, this is arguably the biggest counterfeiting operation ever, by a factor of many times. I’ve seen news about various counterfeiting operations over the years that have made me chuckle, but this one, if that’s what it is, is absolutely jaw-dropping.

The cute part of this is that if the certificates are real Italy just got a hell of a bonanza - their money laundering laws provide for a statutory 40% penalty for failure to declare instruments and cash in excess of $10,000 Euros, which means they’d garner a close-to-$40 billion dollar windfall.

That ought to help their budget problems!

Notice, by the way, that the US Media has totally ignored this story - even though the securities in question are allegedly US instruments.

Gee, I wonder why? Might the authorities know they’re real and be just a wee bit nervous that disclosure of a sovereign attempting to covertly dump nearly $140 billion in debt could cause a wee bit of panic, given that we’re running nearly $200 billion a month in deficits?

Inquiring minds want to know what’s really going on here.

MUCH MORE AT LINK, INCLUDING PICTURE OF THE BONDS

[tclambert]

55. Counterfeit that much and think you won't get caught? Methinks not.

Counterfeiting lottery tickets would be easier.

[ozymandius]

18. Hamilton on CDS Trade: "A fool and his money ..."

Ozy here: I saw this posted yesterday morning but thought this bit of schadenfreude posted at Calculated Risk to be worth adding here.

Read Hamilton's take ...

Here are the details of the trade from the WSJ: A Daring Trade Has Wall Street Seething

The trade involved credit-default swaps and securities backed by subprime mortgages. The original securities ... were backed by $335 million of subprime mortgages mostly on homes in California made at the housing bubble's peak in 2005 ...

....

Believing the securities would become worthless, traders at J.P. Morgan bought credit-default swaps over the past year from Amherst ... Other banks including RBS Securities ... and BofA also bought swaps on the securities from different trading partners.

The banks ... paid as much as 80 to 90 cents for every dollar of insurance, the going rate last fall according to dealer quotes, expecting to receive a dollar back when the securities became worthless ...

In late April, traders at some banks were shocked to find out from monthly remittance reports that the bonds they had bet against had been paid off in full. Normally an investor can't pay off loans like that but if the amount of outstanding loans falls to less than 10% of the original pool, the servicer ... can buy them and make bondholders whole.

Ozy again: So the banks got nothing from the deal.

[Hugin]

48. With these CDSs in play... Is there still anyone who thinks the Banks don't want mortgages to fail?

Yes, they do. It makes them money. It's why they lobbied like Hell to get the Mortgage Relief Bill watered down to uselessness.

and

ITYS.

Of course, this makes me :grr: with the Bank's representatives in Congress. Really, it does.

[UpInArms]

21. dollar watch

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

Last trade 80.225 Change +0.661 (+0.85%)

Carry Diverges From Risk Appetite: What are the Risks to a Market Recovery?

http://www.dailyfx.com/story/bio1/Carry_Diverges_From_Risk_Appetite__1244758222556.html



Risk appetite in most regions of the financial market is still actively suppressed by skepticism over early growth warnings and concern surrounding the eventual unwinding of government support from a still fragile global economy. However, shirking the caution seen most prominently in the equities market, carry interest have surged this past week. Looking at the Carry Trade Index, a sharp 430 point rally this past week has pushed the gauge to retest the 10-month high set early last week. Why the divergence? The answer lies in the market conditions numbers. The DailyFX Volatility Index has shown a quick retreat from the aggressive rise in sentiment that transpired over the previous four weeks. This is in line with the deflated fear indicators for the other traditional asset classes (the VIX, junk bond spreads, credit default swaps, etc). More interesting, however, is the improvement in the other side of the traditional risk/reward balance in the market. While market sentiment is still the primary source of strength for most investments; there have been a few key changes to yields over this past week to support the traditional carry trade basket. Most notably, the RBNZ announced it would hold its benchmark unchanged at 2.50 percent and forecasts for RBA interest turned decidedly hawkish in the span of a few days. Is this shift in returns indicative of the larger currency market? No. However, when sentiment is balanced like it has been over the past few months, a factor like this can make all the difference in the world.

Sudden shifts in yield speculation or sentiment like we have seen this past week are critical for swing traders; but for carry interests, they can be a dangerous distraction. A stability in risk and return is essential for supporting the longer-term strategy. And, considering the evolution of fundamentals this past week, there is little reason to believe that optimism is on the verge of a sudden and complete return. To be sure, there were a few positive events to take account of. The two highest yielding, liquid currencies reported a positive shift in their respective rate forecasts. What’s more, the outlook for an economic recovery was furthered by a far smaller-than-expected drop in US payrolls. However, these are still dull readings in an overwhelming gloom. There is a consensus among policy officials and market participants that current recession will hold over for the rest of the year and that even the eventual recovery will be drawn out and slow. In fact, the World Bank today downgraded its forecasts for activity through 2009 from a 1.7 percent contraction in March to 3.0 percent slump. In the meantime, there are plenty of factors that could derail a recovery. Sovereign debt ratings, ballooning budget deficits, struggling financial institutions, diminishing confidence in safe-haven assets and the government’s eventual withdraw of its financial aid are all big ticket issues. The mention of any one of these at this weekend’s G8 meeting could substantially alter sentiment.

...more...

Dollar Gains As Japanese Officials Show Support , Will A Rise in Consumer Confidence Add To Bullish Sentiment?

http://www.dailyfx.com/story/topheadline/Dollar_Gains_As_Japanese_Officials_1244800678160.html

The Euro has traded heavy throughout overnight trading reaching as low as weak fundamental data add to a pull back in risk appetite. Indeed, industrial production for the Euro-zone fell by 1.9% in April which was far greater than the -0.4% which was expected. The monthly decline dragged the annualized rate to -21.6% which was the most on record. Meanwhile, prices continue to fall in the region as French CPI turned negative for the first time since record keeping began in 1996 with a -0.3% Y/Y reading. The German wholesale price index added to the story as it dropped by 8.9% which was the most in 22 years. The ECB has forecasted that inflation will turn negative for the region over the coming months but will start to move back toward its 2% target by the end of the year.

A look at the breakdown for the region’s output shows that a 4.0% reduction in energy led the decline followed by a 2.7% fall in capital goods. We could see the energy numbers reverse as rising oi prices will begin to inspire producers to take advantage of potential rising profits. However, the drop in capital goods will weigh on any hopes for a rapid recovery for the economic union. Also, a 26.7% reduction in durable consumer goods on a yearly basis underlines the depth of the retrenchment by consumers and we may not see prior levels of consumption return for sometime. The 20-Day SMA remains supportive for the pair at 1.3984 which has negated the possible head & shoulders pattern that we were looking to see develop. Therefore, the longer term bullish trend remains strong and until we see a break below the technical level we will look for more gains from the single currency.

After reaching as high as 1.6600, the sterling has started to see some profit taking as bulls recognizing the broader dollar strength gave up the fight for the time being. BoE committee member Paul Fisher acknowledged that the U.K. is seeing signs of recovery but policymakers shouldn’t become complacent as “there are likely to be bumps in the road ahead, with many twists and turns.” Nevertheless, the quantitative easing measures by the government have continues to help boost liquidity in the markets which is helping the housing sector recover and leading to a pick up ion output. The 6/10 low of 1.6241 is the most likely point for a reversal, but a break below there could see a test of the 20-day SMA at 1.6075 before a return of bullish sentiment.

The dollar has been well bid through overnight trading across the board as Japanese Finance Minister Kaoru Yosano said his nation’s confidence in U.S. debt is “unshakable” and that the currency’s global status is safe. Despite rhetoric from countries such as Russia calling for the end of the dollar as the world reserve, the safety and liquidity of U.S. Treasuries will make it difficult for them to find an adequate substitute at this time. It will take a conscious global effort to achieve this and given the rate that initiatives of that magnitude take, it could be sometime before we see a suitable alternative developed. Meanwhile, the University of Michigan consumer confidence survey will provide the only significant event risk for the day as it is forecasted to improve to 69.5 from 68.7 which would be the highest since last September. It has been rising optimism which has bolstered demand for risky assets and another uptick in consumer sentiment should add to the theme. Therefore, we could see greenback weakness on the pick up in risk appetite as traders look to buy assets that will benefit from an increase in domestic demand . However, we must continue to monitor that relationship as we go forward and be aware that positive fundamental data will begin to generate bullish dollar price action.

...more...

[ozymandius]

28. Dollar’s Reserve Status May Deteriorate, Roubini Says (Update1)

June 11 (Bloomberg) -- The dollar’s status as the world economy’s sole reserve currency may deteriorate, said Nouriel Roubini, the New York University economics professor who predicted the financial crisis.

“We may see complementary reserve currencies,” Roubini said at a conference today in Athens. While it’s “not going to happen overnight,” the development “will diminish the role of the dollar over time.”

The dollar’s status has come into question as leaders of Brazil, Russia, India and China discuss substituting other assets for their dollar holdings amid a ballooning budget deficit that keeps the U.S. dependent on foreign financing. China alone owns about $744 billion of U.S. Treasury bonds among its $2 trillion of foreign-exchange reserves.

Russian President Dmitry Medvedev last week renewed his call for consideration of a supranational currency to challenge the dollar. Chinese Central Bank Governor Zhou Xiaochuan said in March that the International Monetary Fund should create a “super-sovereign reserve currency.”

http://www.bloomberg.com/apps/news?pid=20601109&sid=aRMZbES7DNFc

[UpInArms]

30. Roubini's predictions are usually right on target

but we have all been watching this unfold for quite some time now.

[UpInArms]

24. (Hedge Fund) BlackRock to buy BGI, becomes top asset manager ($2.7 Trillion in assets!)

http://www.reuters.com/article/businessNews/idUSTRE55B06X20090612?feedType=RSS&feedName=businessNews&sp=true

BOSTON (Reuters) - BlackRock Inc. said on Thursday it will buy British bank Barclays Plc's investment arm BGI for $13.5 billion in a blockbuster deal that will create the world's biggest asset manager.

For BlackRock, a 21-year old company which relied heavily on acquisitions to grow from a one-room bond investment firm into the largest publicly traded U.S. money manager, the deal will more than double assets to roughly $2.7 trillion.

It will also give New York-based BlackRock, well-known for working with governments and institutional clients, access to retail investors and the hugely popular exchange traded funds San Francisco-based Barclays Global Investors offers.

BGI, which has operations in 15 countries and ranks as Europe's largest hedge fund manager, will help expand BlackRock's reach around the world and into new products spanning actively and passively managed portfolios.

<snip>

"This is a transformational transaction" for the investment management industry Laurence Fink, BlackRock's chief executive officer, said on a hastily arranged conference call late on Thursday.

Fink said BlackRock has received commitments from a global network of institutional investors and clients to purchase 19.9 million shares at the closing of the transaction for a total of $2.8 billion. He would not disclose the investors.

...more...

Do you want to do biz with a guy named "Fink"?

[Demeter]

64. Depends On Whether It's His First Name, Last Name, or Nickname.

[UpInArms]

25. AIG to use any winnings in trial (vs. Maurice "Hank" Greenberg) to repay taxpayers

http://www.reuters.com/article/businessNews/idUSTRE55B02O20090612?feedType=RSS&feedName=businessNews&sp=true

NEW YORK (Reuters) - AIG, days before a high-profile legal fight with a company controlled by former CEO Maurice Greenberg heads to court, promised to use any funds won at trial to repay U.S. taxpayers.

"While any relief granted for AIG's equitable and legal claims will be subject to the findings and judgment of the court, AIG intends to use any monetary damages, including $4.3 billion of illicit stock sales, to repay the company's debt to the U.S. government," said AIG spokesman Mark Herr.

The case, scheduled to begin on Monday in U.S. District Court in Manhattan, relates to a long-contested block of American International Group (AIG.N) stock held by Starr International Co, a company controlled by Greenberg.

A lawyer for Starr International was not immediately available for comment.

AIG, claiming breach of fiduciary duty, is seeking to wrest back shares held by Starr, and the proceeds of any sales, at the same time as it tries to repay about $85 billion in taxpayer loans.

The U.S. government stepped in to save AIG from collapse under bad mortgage bets last September, and has put up to $180 billion at the company's disposal since.

...more...

imho, the Greenberg fam resides very close to the bottom of the pond

[nc4bo]

49. $85b, that's all? Wasn't the war criminal sliding billions if not trillions into

AIG's black gaping hole even before it busted wide open?

"Too big to fail"

[tclambert]

57. Wait, wait, wait. I thought Greenberg was suing THEM?

He accused them of making false statements to stockholders, which cost him a fortune.

Yeah, here's that story:


Maurice Greenberg Sues AIG, Saying Its Shares Were ‘Inflated’

By David Glovin

March 2 (Bloomberg) -- American International Group Inc., which reported the biggest loss by a publicly traded U.S. firm, was sued for securities fraud by former Chief Executive Officer Maurice “Hank” Greenberg.

Greenberg filed his suit today in Manhattan federal court, saying the company’s “material misrepresentations and omissions” caused him to acquire AIG shares in his deferred compensation profit participation plan at an inflated valued.

The suit comes on the same day that AIG CEO Edward Liddy said that Greenberg was partially to blame for the firm’s woes. Greenberg, 83, led AIG for almost 40 years before being forced to retire in 2005.

The case is Greenberg v. AIG, 09-cv-1885, U.S. District Court, Southern District of New York (Manhattan).

http://www.bloomberg.com/apps/news?pid=20601087&sid=aThygNETEI7A&refer=home
_____________________________

I remember laughing about it on this thread because he was once CEO and maybe responsible for the very stuff he was suing them for. So it seemed kinda like he was suing himself. He claimed actions they took after he left cost him $2 billion.

It was on the March 4th Stock Market Watch http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3766323#3766468

[DemReadingDU]

27. Charles Hugh Smith: Food and Energy Are Still Too Cheap

Very interesting - How to tell when food gets expensive...


Food and Energy Are Still Too Cheap (June 12, 2009)
Charles Hugh Smith

The tremendous waste of food and energy in the U.S. reveals that these essentials are still too cheap to be conserved/valued.


I know you hate it when I come up with some outrageously contrarian view (come on, you know you love it!) and so let's consider the notion that food and energy are still absurdly cheap in the U.S.

Why is this contrarian? Joining "green shoots/ recession is ending" as a popular rote-repeated cliche is "food is so expensive 'poor people' can only afford McDonalds and macaroni and cheese."

If food is so horribly expensive, why do I find huge quantities of perfectly good untouched/unopened food in trash bins? Yes, I am a dumpster diver, mostly because I hate to see perfectly good food/stuff dumped in the landfill.

Recently I pulled out: steaks (the costly kind sealed in plastic), high quality ground beef, unopened spaghetti packages, half-used spices, an unopened bag of frozen mahi-mahi and numerous cans of soup, etc.

OK, so somebody's roommate moved out and they promptly threw away all the guy/gal's food, including unopened steaks, ground beef, pasta, canned goods, etc. Note that they couldn't be bothered to give the stuff to a food bank--they just dumped it. I find this all the time; it is not a rarity.

Yes, the cans were past the absurd "best by" date--but canned goods will last for years past the due dates. The food industry doesn't even test this stuff for actual longevity in the sense of "past this date, if you eat this, you die"--they just set the dates such that the consumer will be encouraged to toss it and buy new stuff.

I propose a new metric for the cost of food: the squeamish/cost ratio. If the squeamishness caused by the fact that someone else bought and/or touched this unopened food (horrors!) is outweighed by the value of the food such that it is consumed, then food is in fact expensive.

The corollary is the canned-good expiration date/cost ratio. If the chances of dying a horrible, lingering death due to food poisoning (note to consumers: your body has a mechanism for rejecting spoiled food called "vomiting") are finally outweighed by a rational calculation that the odds of said horrible, lingering death due to mysterious toxicity of canned food are actually remote, leading to consumption of "expired" sealed food, then food can be said to be expensive.

Other corollaries suggest themselves: if a head of lettuce is tossed because the outer leaves are wilted, if a pound of perfectly good veggies are tossed because one harmless bug was found on said veggie, etc., then food is still far too cheap.

Let me tell you what will happen when food is really expensive. People won't be going through trash bins looking for brand-new shoes and aluminum cans; they'll be pulling out whatever edible food has been tossed. Squeamishness will decline to near-zero.

If food were actually costly, somebody elese would have snagged all those goodies before I even got to the trash bin. Meanwhile, here in the U.S., even homeless people have the "right" to be squeamish: anything past its expiration date by even a day is tossed lest an organization be accused of treating their patrons as less worthy than any other squeamish American. Homeless people have been known (first-hand report from a volunteer) to reject sandwiches which don't meet their refined standards.

Let's face it: food is treated as expendable trash in the U.S.

Three of us were recently making a 400-mile drive after an exhausting week and so we stopped at Burger King for lunch (one of two annual visits to a fast-food emporium). It cost $11.30 for three sandwiches: no drinks, fries or other goodies. Seeing as how I can buy an entire bag of real food for $10-$15 in an ethnic market, that didn't strike me a "cheap." Fast-food is not "cheap" by any metric except perhaps toxic calories.

As for energy: when galoots in oversized pickups and SUVs are drag-racing off the line when the traffic light turns green, energy is still far too cheap. When gasoline hit $4.50/gallon, I observed the first faint glimmerings of conservation. When gasoline hits $10/gallon (and it will, sooner than most expect) then conservation might actually take hold.

I know the idea that food and energy are expensive is dearly beloved; we prefer self-pity to the conclusions drawn from observable behaviors. Take a look around; do some dumpster-diving and watch how people are driving. Those behaviors indicate food and energy are still incredibly cheap in the U.S. When food actually becomes expensive, people won't be throwing away pasta because the bag was opened by another mortal who actually cooked some of the contents; they will be snatching the half-full bag up as a found treasure.

http://www.oftwominds.com/blogjune09/food-cheap06-09.html

[Demeter]

47. There Are Ridiculous Health Laws That Force Markets and Restaurants to Dump Food

because of a few well-publicized food poisoning incidents.

Much of that dumping is wasteful, some of it is necessary. The health departments prefer to err on the side of wastefulness.

Funny, but most of our food poisoning nowadays comes from the imports, processors or the growers straight to your home or business.

[fasttense]

56. Almost all of the tainted produce like lettuce and spinach have come from Agribusinesses.

The poisoned produce came from giant corporations too busy trying to increase their output to be concerned about the manure infested water they are sprinkling on their lettuce and spinach. They are so busy looking for ways to cut their cost of labor that they can't be bothered with waiting a year for the chicken shit to compost. Instead they put the salmonella crap right on the crops they are shipping to your local high school.

Buy from a local farmer. You can go visit him/her and see what kind of water and compost they are using. Besides, if he/she were to sell poisoned produce, you can bet every government agency in the US would be all over him, shutting down his operation in a heartbeat.

Buy local and eat safely.

[tclambert]

58. Those laws SEEM ridiculous until you see what ridiculous behavior made them necessary.

Sometimes my wife watches Gordon Ramsey's "Kitchen Nightmares." It is astounding how filthy some of these failing restaurant kitchens can get. In one kitchen he found a rotten, molding tomato with a slice missing from it. And he says, "Where is the rest of this? Are you honestly telling me that some poor, unsuspecting customer is out there right now with a piece of this tomato in his salad?" And he has had to explain to more than one clueless restaurant owner that the green meat in their almost room temperature "refrigerator" could KILL people. It sounds like common sense. Yet almost every one of his restaurant makeovers starts with cleaning out the kitchens, freezers, and pantries.

With strict health codes on the books, things like that still happen because of lack of enforcement. Not enough inspectors, clever managers finding ways to cut corners and not get caught, and stupid idiots who won't go out of business for a few more months.

In one episode in Manhattan, Ramsey took the owner, manager, and cooks for a two block walk to one of his own restaurants to show them what a good kitchen looked like. It was spotless, brightly lit, highly organized. You could see the astonishment and envy on their faces, and a slowly dawning realization that maybe they needed to put some effort into cleaning up their little pigsty.

[Demeter]

63. Pigstys Have Nothing To Do With "Sell Dates"

I was in the business, I know the difference.

[UpInArms]

29. Riverstone pays $30 million in pension probe

http://www.reuters.com/article/businessNews/idUSTRE55A5D120090611?feedType=RSS&feedName=businessNews&sp=true

NEW YORK (Reuters) - Private equity firm Riverstone Holdings LLC agreed to pay $30 million to resolve its role in a corruption probe of New York state's pension fund, Attorney General Andrew Cuomo said on Thursday.

Like The Carlyle Group CYL.UL, which in May paid $20 million to settle its role, its partner Riverstone also agreed to stop using placement agents and undertake other reforms in Cuomo's new code of conduct.

For over two years, the Democratic attorney general has been probing millions of dollars of kickbacks paid by investment firms eager to invest the state's $110 billion retirement fund. The investment firms hired an array of middlemen -- lobbyists, lawyers, media consultants and placement agents -- who reaped the fees.

But by jacking up the "cost of doing business," these fees cost taxpayers dearly, Cuomo said in a conference call, noting the public now is being asked to contribute more to the fund to make up for its recent steep investment losses.

...more...

[Demeter]

42. A Picture Worth a Thousand Words--Great Cartoon, Ozy!

It says it all, doesn't it?

[UpInArms]

54. Summers says U.S. acts in markets when necessary (hand not so invisible)

http://www.marketwatch.com/story/summers-says-us-acts-in-markets-when-necessary-2009612111550

WASHINGTON (MarketWatch) -- The U.S. acts in markets only when necessary and is trying to save them from their own excesses and improve them, White House National Economic Council Director Larry Summers said Friday. "The actions we take are those of necessity, not of choice," Summers said in remarks prepared for delivery at the Council on Foreign Relations. He said President Barack Obama didn't run for office to manage banks, insurance companies or auto manufacturers.

[Demeter]

65. Nyuk! Nyuk!

(Just warming up, carry on)

[ozymandius]

61. closing... looking at the volume, it's elevated but not gangbusters

Dow 8,799.26 Up 28.34 (0.32%)
Nasdaq 1,858.80 Down 3.57 (0.19%)
S&P 500 946.21 Up 1.32 (0.14%)
10-Yr Bond 3.788% Down 0.074
NYSE Volume 5,138,631,000
Nasdaq Volume 2,052,790,62

4:30 pm : Stocks spent most of the session confined to a narrow trading range in negative territory, but managed to move higher heading into the final leg of trading. Pronounced, late-session moves have been the norm this week, but this one was a bit sloppy as stocks had to fight to hold the advance.

Trading volume was exceptionally light this session, suggesting a lack of conviction in the market's moves and, certainly, a lack of participation. Only around 860 million shares traded hands on the NYSE. That's nearly half the level typically seen in the last 50 sessions.

The latest round of range bound trading came largely as a result of a lack of leadership. Materials stocks (-1.3%), which have provided leadership in recent weeks, were knocked lower as commodities came under pressure amid a rally in the U.S. dollar.

With the Dollar Index advancing 0.9%, the CRB Commodity Index fell 1.5%. Gold prices dropped 2.2% to finish at $940.50 per ounce. Crude oil futures pulled back from 2009 highs to finish 0.8% lower at $72.05 per barrel. News from Reuters that OPEC believes that worst appears to be over for the oil market didn't seem to provide much support.

The downturn in oil prices helped send energy stocks to a 1.0% loss. Oil and gas equipment stocks (-2.5%) and drillers (-2.0%) were among the weakest plays in the sector.

Semiconductor stocks also fell under pressure this session, sending the Semiconductor Index to a 1.8% loss. The downturn came in the face of a less severe-than-expected quarterly loss and in-line revenue outlook from National Semiconductor (NSM 13.59, -0.88). Weakness among semiconductors dragged the tech sector to a 0.2% loss and weighed on the Nasdaq Composite, causing it to underperform the other headline indices.

The upward push into the close helped drive gains in the rest of the market, though. Financial stocks (+0.7%), which were instrumental in the stock market's move from its March lows, had a choppy session before spiking into the close and finishing at session highs. Diversified financial services companies (+2.6%) and diversified banks (+1.6%) underpinned the late advance. Many of them are expected to start repaying government bailout funds next week, according to reports.

Investment services firm BlackRock (BLK 176.56, -6.04) trailed after updating its outlook to reflect its agreement to pay $13.5 billion for the global investors business from Barclays (BCS 19.27, -0.63).

Treasuries found continued support, even as The Wall Street Journal reported that the Fed is unlikely to significantly boost purchases of Treasuries. However, supportive comments from a Japanese official likely provided an underlying bid. In turn, the 10-year Note advanced 18 ticks, which has pushed its yield down to 3.78% after being near 4.0% just a couple of days ago.DJ30 +28.34 NASDAQ -3.57 NQ100 -0.5% R2K +0.1% SP400 -0.3% SP500 +1.32 NASDAQ Adv/Vol/Dec 1236/2.05 bln/1442 NYSE Adv/Vol/Dec 1369/857 mln/1623

[Festivito]

66. Debt: 06/10/2009 11,383,987,605,139.01 (DOWN 7,471,650,289.94) (Small rise in debt, FICA down.)

(Debt moves up .124B$. That's small once again. Sixth attempt to post. Five failed.)

= Held by the Public + Intragovernmental(FICA)
= 7,110,096,282,278.54 + 4,273,891,322,860.47
UP 124,232,779.18 + DOWN 7,595,883,069.12

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 307-Million person America.
If every American, man, woman and child puts in $3.26 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.78, ABOUT TEN BUCKS for a 1B$ 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 12 seconds we net gain a another American, so at the end of the workday of the report, there should be 306,623,942 people in America.
http://www.census.gov/population/www/popclockus.html ON 05/25/2009 01:14 -> 306,504,012
Currently, each of these Americans owe $37,126.87.
A family of three owes $111,380.61. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 21 reports in the last 30 to 33 days.
The average for the last 21 reports is 5,966,371,889.61.
The average for the last 30 days would be 4,176,460,322.73.
The average for the last 33 days would be 3,796,782,111.57.
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$/day.
There were 96 reports in 141 days of Obama's part of FY2009 averaging -0.08B$ per report, -0.01B$/day so far.
There were 171 reports in 253 days of FY2009 averaging 7.95B$ per report, 5.37B$/day.

PROJECTION:
There are 1,320 days remaining in this Obama 1st term.
By that time the debt could be between 13.2 and 18.5T$.
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)
06/10/2009 11,383,987,605,139.01 BHO (UP 757,110,556,225.93 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: 1,359,262,708,226.60 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
05/19/2009 +000,244,659,127.63 ------------********
05/20/2009 +000,422,183,214.17 ------------********
05/21/2009 +016,742,591,292.36 ------------**********
05/22/2009 +000,007,301,981.46 ------------******
05/26/2009 +000,178,213,075.69 ------------******** Tue
05/27/2009 +000,332,821,919.42 ------------********
05/29/2009 +019,434,324,960.50 ------------**********
06/01/2009 +078,540,152,146.76 ------------********** Mon
06/02/2009 +000,543,288,286.72 ------------********
06/03/2009 -000,003,266,733.82 -----
06/04/2009 +011,755,789,483.75 ------------**********
06/05/2009 -000,226,149,345.97 ---
06/08/2009 +000,015,040,049.19 ------------******* Mon
06/09/2009 +000,025,670,087.48 ------------*******
06/10/2009 +000,124,232,779.18 ------------********

128,136,852,324.52 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,719,355,801,879.94 in last 265 days.
That's 1,719B$ in 265 days.
More than any year ever, including last year, and it's 169% of that highest year ever only in 265 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 265 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=3917341&mesg_id=3917361

[Festivito]

67. Debt: 06/11/2009 11,375,626,420,309.63 (DOWN 8,361,184,829.38) (Small rise in debt, FICA down.)

(Debt moves up about half a billion. That's not so much. Having trouble posting on DU. Tried to catch up. Perhaps can not post to a too-old thread.)

= Held by the Public + Intragovernmental(FICA)
= 7,110,580,992,583.70 + 4,265,045,427,725.93
UP 484,710,305.16 + DOWN 8,845,895,134.54

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 307-Million person America.
If every American, man, woman and child puts in $3.26 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.78, ABOUT TEN BUCKS for a 1B$ 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 12 seconds we net gain a another American, so at the end of the workday of the report, there should be 306,631,142 people in America.
http://www.census.gov/population/www/popclockus.html ON 05/25/2009 01:14 -> 306,504,012
Currently, each of these Americans owe $37,098.73.
A family of three owes $111,296.19. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 21 reports in the last 30 to 31 days.
The average for the last 21 reports is 5,484,369,913.26.
The average for the last 30 days would be 3,839,058,939.28.
The average for the last 31 days would be 3,715,218,328.34.
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$/day.
There were 97 reports in 142 days of Obama's part of FY2009 averaging -0.18B$ per report, -0.06B$/day so far.
There were 172 reports in 254 days of FY2009 averaging 7.85B$ per report, 5.32B$/day.

PROJECTION:
There are 1,319 days remaining in this Obama 1st term.
By that time the debt could be between 13.2 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)
06/11/2009 11,375,626,420,309.63 BHO (UP 748,749,371,396.55 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: 1,350,901,523,397.20 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
05/20/2009 +000,422,183,214.17 ------------********
05/21/2009 +016,742,591,292.36 ------------**********
05/22/2009 +000,007,301,981.46 ------------******
05/26/2009 +000,178,213,075.69 ------------******** Tue
05/27/2009 +000,332,821,919.42 ------------********
05/29/2009 +019,434,324,960.50 ------------**********
06/01/2009 +078,540,152,146.76 ------------********** Mon
06/02/2009 +000,543,288,286.72 ------------********
06/03/2009 -000,003,266,733.82 -----
06/04/2009 +011,755,789,483.75 ------------**********
06/05/2009 -000,226,149,345.97 ---
06/08/2009 +000,015,040,049.19 ------------******* Mon
06/09/2009 +000,025,670,087.48 ------------*******
06/10/2009 +000,124,232,779.18 ------------********
06/11/2009 +000,484,710,305.16 ------------********

128,376,903,502.05 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,710,994,617,050.56 in last 266 days.
That's 1,711B$ in 266 days.
More than any year ever, including last year, and it's 168% of that highest year ever only in 266 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 266 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=3918916&mesg_id=3923364