STOCK MARKET WATCH, Monday February 8

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday February 8, 2010

Bush Administration Officials Convicted = 2
Name(s): David Safavian, James Fondren

Bush Administration Officials Charged = 1
Name(s): Richard Lopez Razo

Financial Sector Officials Convicted since 1/20/09 = 11

AT THE CLOSING BELL ON February 5, 2010

Dow... 10,012.23 +10.05 (+0.10%)
Nasdaq... 2,141.12 +15.69 (+0.74%)
S&P 500... 1,066.19 +3.08 (+0.29%)
Gold future... 1,054 -9.50 (-0.89%)
10-Yr Bond... 3.57 -0.04 (-0.97%)
30-Year Bond 4.52 -0.03 (-0.57%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie, Silver and US$

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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

Cycle Logical Issues?
BY BRIAN PRETTI

One of the themes I’ve been discussing on our subscriber site has been our expectation for an increase in market volatility. Probably about three weeks back I wrote, “Unlike the consensus and big Street houses which have been predicting/expecting falling volatility in 2010 after an already accomplished death defying drop in volatility during 2009, we’re not so sure shorting volatility is such a wonderful investment idea right here. Although we could be dead wrong, we believe 2010 will present us with a great opportunity to buy volatility. We could be very close right now.” I’m not reprinting this to proverbially pat myself on the back as the year is still very young. Secondly, anyone spending time patting themselves on the back in this business is usually about 15 seconds away from having the proverbial rug pulled out from under them. Anything can happen, so judgment is reserved for now as we’ll just have to see what happens on the financial market front as we move forward. I believe an increase in volatility is in store not only for the financial markets, but also in a much broader context I’d like to discuss in this missive. I want to quickly talk about another type of volatility – economic volatility. And want to take a look at the long term in the hope that perhaps we can “see” the future more clearly. Here’s the question that may indeed morph into an investment theme for 2010 and beyond. Looking ahead, will the US economy be more or less volatile than we have experienced over what is close to the last thirty years? Yes or no? If indeed this questioning is anywhere even close to the mark regarding the thought that economic volatility will increase, then that has direct and meaningful implications for equity and broader business valuations. Let’s start digging through some facts.

....

So the important thematic question becomes, in the assumed absence of significant acceleration in the US credit cycle ahead as both households and corporations continue to delever, will the forward rhythm of US GDP become more volatile, perhaps as was the case from 1950 through the early 1980’s? Will we experience higher rate of change highs and lower lows than has been seen since the early 1980’s? Although this is a question no one can answer with any type of certainty at this point, it’s very worthy of consideration and benchmarking as we move forward for if this is anywhere even near being on the right track with this thinking, then increased economic volatility ahead will absolutely influence future investment outcomes, primarily valuations. Referring back to the bottom clip of the first chart, the depth of the real GDP rate of change low in the current cycle looks much more like experience of the US economy from 1950-82. An early marker of character change? We'll see.

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

[ozymandius]

2. no goobermental reports today n/t

[ozymandius]

3. Oil above $72 amid US cold snap, Iran tensions

SINGAPORE – Oil prices jumped above $72 a barrel Monday in Asia after hitting a two-month low last week, boosted by tensions over Iran's nuclear program and a cold snap in the U.S. northeast.

Benchmark crude for March delivery was up 87 cents at $72.06 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract plunged $1.95 to settle at $71.19 on Friday. ...

In other Nymex trading in March contracts, heating oil rose 2.32 cents to $1.898 a gallon, and gasoline was up 1.51 cent at $1.9015 a gallon. Natural gas rose 9.7 cents to $5.61 per 1,000 cubic feet.

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

[ozymandius]

4. Average gas prices down 5.76 cents nationwide

CAMARILLO, Calif. – The average price of regular gasoline in the United States fell 5.76 cents over a two-week period to $2.67.

That's according to the national Lundberg Survey of fuel prices released Sunday.

Analyst Trilby Lundberg says the average price for a gallon of mid-grade was $2.80. Premium was at $2.91.

http://news.yahoo.com/s/ap/20100207/ap_on_bi_ge/us_gas_prices_1

[ozymandius]

5. Japan bank lending slides as funding demand weak

TOKYO (Reuters) – Japanese bank lending logged its biggest annual fall in more than four years in January as companies faced with overcapacity and a murky economic outlook steered clear of borrowing for capital investment purposes.

The softness in domestic demand could also be seen in Japan's current account surplus, which surged more than fivefold in the year to December thanks to a recovery in exports.

While that bodes well for the outlook for an export-led recovery, Bank of Japan Deputy Governor Hirohide Yamaguchi said the economy could linger in the doldrums until around the summer before getting back on a more sustainable course to recovery. ....

The Bank of Japan in December decided to offer banks more short-term funds, caving in to pressure from the government for more action to fight deflation and support the economy ahead of elections in the summer.

But Monday's data showed that the cash is not spreading through the economy as funding demand remains anemic.

http://news.yahoo.com/s/nm/20100208/bs_nm/us_japan_economy

---

Another lost decade looks to be in the making for Japan.

[ozymandius]

6. Governor plans emergency address on Nevada budget

CARSON CITY, Nev. – Nevada's budget is so far out of balance that by one account the state could lay off every worker paid from the general fund and still be $300 million in the red. The economic downturn has hit so hard that prisons may be closed, entire colleges shuttered and thousands left without jobs.
Against the backdrop of an imploding economy and an $881 million shortage, Gov. Jim Gibbons will try in an emergency "State of the State" address Monday to explain the depth of the state's financial crisis and how fixing the gaping hole in the budget.

It won't be pretty.

Nevada, with a heavy reliance on discretionary spending through gambling and sales taxes, has been especially hard hit by the recession as tourists and gamblers hold on to their money. The state's unemployment rate has hit 13 percent, and a once booming housing market that created thousands of high-paying construction jobs has gone bust, with Nevada topping the nation in foreclosures.

In his address, Gibbons plans to call the Legislature into a special session in late February and instruct lawmakers on areas they can focus on. It will be left to the state Assembly and Senate to tackle painful education and social services cuts. ....

Assembly Speaker Barbara Buckley, D-Las Vegas, said balancing the budget would require 22 percent cuts across the board. She said the state could lay off every worker paid from the state general fund — and still be $300 million short.

Gibbons, a staunch no-tax proponent, has said new taxes are not an option, and legislative leaders seem to agree raising taxes is unpalatable in the sour economy.

http://news.yahoo.com/s/ap/20100207/ap_on_re_us/us_nevada_state_of_state

---

Idiots. Tax increases are anathema to these no-taxers even when times are good. Now that times are bad there is no impulse to raise tax revenues among those segments of the local economy that could sustain an increase. Really - it seems as though these governments desire to fail.

[Dr.Phool]

17. They only know the word "cut".

I guess after 30 years of training, they all act like Pavlov's Dog.

Nobody seems to consider ways to increase revenue.

[Tansy_Gold]

26. Most of the services that will be cut

mainly benefit the non-elites non-aristos. The aristos don't care, because they can pay for their own police, their own schools, their own roads. The rest of us can go scratch.

I'm probably going to lose about 90% of my "free-lance" income today, not because the work isn't there or I haven't done mine well enough, but because in fact I did my job too well. The "nightmare" software conversion went poorly last week, and I made the mistake of daring to complain about it, and doing so with the kind of honesty ("A two-page hand-out is NOT an instruction manual!") that was not welcome. The quality of the work and even the productivity of the workers is FAR FAR FAR less important than the complacency of the workers. Those who are not complacent are being removed. Those who pointed out errors in judgment by management are being removed.

As an independent subcontractor, I have no recourse. Even if I were "an employee," in Arizona the only benefit is the ability to collect unemployment unless the employer can show one has been terminated "for cause."

And this seems to be indicative of the labor market in general, that even those who have jobs are treated like shit because those at the top know there is a huge pool of the hungry and willing-to-be-abused-for-the-sake-of-a-paycheck just waiting. And some of those who have jobs are not willing to speak out for fear of losing them. This is a recipe for continued, and worsening, abuse.

If my contract is cancelled, I can live with it. I have sufficient other resources that I'm not going to be homeless or anything. But I use my may-not-even-happen experience to point out what the economy is doing not just to incomes but to attitudes.

However, if my contract is cancelled, I will have more time to devote to my presidential campaign.




Tansy Gold, waiting. . . .

[Dr.Phool]

27. Here's a letter to Ilargi at AE over the week-end.

Then I have a third bit as well. This is a comment sent as a private email by a highly appreciated frequent commenter at The Automatic Earth, a Mr. L. Gallinazo. I thought it'd be worth sharing, and so did he. Just something for you to chew on.

The last thing that a loan shark wants is that you pay off your loan. You just have to be able and willing to keep paying the interest on the loan. Baseball bats are often used as incentives. The sovereign debt crises are caused by the population at large expecting to get services for their taxes and the elites and their politicians expecting to be able to steal most of those taxes. Of course the elites are already stealing huge amounts in the "private sector", but as the Duchess of Windsor once said, "One can never be too rich or too thin." So they reach a compromise which is to go deeper into debt. The elites get to steal and the citizens get some services.

But now the debts, even at historically low rates of interest, are becoming unpayable because they have become too large and because tax receipts are crumbling as the economies crumble. Well, the elites have a solution - they call it austerity, meaning the populace gets nothing for their taxes and the elites get it all. Of course Usacos and Canadians are too dumbed down to understand this, but Europeans, with the probable exception of the UK, are more sophisticated and have not let the elites totally take over all mass modes of influence. So we are heading to a Mexican stand-off. (Which, for you Europeans and Africans, is when two gamblers are holding their revolvers, hammers cocked and finger on the trigger, into each others bellies under the card table.)

Of course there will be a bail out, the only question is whether it will be by the EU itself or the IMF. Anything to kick the can down the road for another couple of months. As Ilargi surmised some time ago, the only reason that this has not been announced is that the EU is using the tempest to lower the forex rate against the dollar and yen. And the yuan also as it is pegged to the dollar once again. If a country as significant as Greece (our cradle of western civilization) is allowed to default on its debt, it marks the end game of the international banking system. As a recent column by Mish (whose policies toward labor I despise) pointed out, when the 14 year olds of the world start asking their countries, "Why should I pay off your friggin' credit card," it's the end of the line. So the banksters' private debt has been transferred to sovereign, and unless Jesus returns, there is no one left to hand it off to.

http://theautomaticearth.blogspot.com/

[ozymandius]

29. I appreciate that analogy.

"So the banksters' private debt has been transferred to sovereign, and unless Jesus returns, there is no one left to hand it off to. "

I wonder what an end to the international banking system would look like. I also am curious to know how TBTF fails. One could assume that a modern economy like Greece and member of the EU would be TBTF. But if it does - what are the positives and the negatives (as in populist attributes) from such an occurrence?

[Tansy_Gold]

46. Curiosity intrudes

We've focused so much on the U.S. economy -- or at least I have -- and maybe to the detriment of understanding how other economies are linked to ours. So maybe some new questions need answers --

1. What are the $$$ values of the EU member economies?
2. What are their trade balances?
3. What are their primary intra-EU imports/exports?
4. Extra-EU imports/exports?

Anybody got a good website link for basic info like this?




Tansy Gold, who is still running for POTUS but also looking at the possibility of emigrating. . . . contradictions inside of contradictions. . . . :evilgrin:

[Demeter]

49. I Think There Is a Problem of Definition

There is the real economy, where real people make, buy and sell real things.

Then there is an ephemeral economy that exists only on paper: paper money, paper assets, casino or bookie bets known as CDS of various flavors.

Since I don't know when, probably when Greenspan destroyed the interest rate for ordinary savers, the ephemeral economy has dominated the conversation and sucked all the oxygen, and all of the real jobs, out of the room.

The Great Experiment known as the Post-Industrial Economy has been shown to be just as bogus as Cold Fusion.

(Cold Fusion, by the way, was discovered by a sloppy scientist who was working in a room with unshielded radioactive materials within range of his instrumentation. This is why no one else could duplicate his results.)

The only reason anybody could claim they were "working" and "making money" in the Post Industrial Economy was because they had found new, sneaky ways of stealing anything that wasn't nailed down--and breaking the contracts for things that were. And the export of all the manufacturing made sure that the US economy would be hollowed out like an orange after squeezing.

What little interaction there is between the Real Economy and the Ephemeral one is all one way--as is the case with all piracy.

We have been had, and will continue to be had, until somebody puts a stop to it. Moving out of the ephemeral economy's clutches can be done on an individual basis, but we must do it on a community basis, and to do that, we must manufacture our own domestic goods, get paid reasonable interest on our savings, and take back the nation's wealth from the pirates.

It is a revolution, but it is what we need. We could have gotten it from a real leader, if we had one to elect....but that's a whole other rant!

[Ghost Dog]

63. Greek PM: 'concerted attack' against the euro

Greek Prime Minister George Papandreou has warned that a "concerted attack" was underway against the euro, with Spain and Portugal now being targeted, after Greece.

...

Evidence of income criteria for everyone and cash registers everywhere were just two of the upcoming tax measures unveiled by Finance Minister George Papaconstantinou on Sunday, in an interview regarding the government's planned tax reforms that was published by the Sunday edition of the newspaper "Ethnos".

The minister repeated earlier announcements regarding the abolition of separate tax rates for certain sources of income and said the government intended to abolish early pension privileges and unfair salaries in the public-sector. At the same time, he stressed the need for everyone to contribute according to their means and to provide protection for those that were weakest.

He confirmed the abolition of a uniform property tax, to be replaced by a scaled property tax that would require those with major real estate holdings to pay the largest amounts, and emphasised the government's determination to use every electronic means available to monitor and cross-check the tax statements submitted by tax payers.

...

During the interview, the finance minister also referred to Greece's massive debt and deficit, pointing out that the country will have to borrow 54 billion euros from markets during the current year. He underlined that Greece had not submitted to the 'dictates of the EU' but was taking steps to comply with a set of rules that it had signed for when it joined the eurozone and was currently violating.

At the same time, the government had to act in order to protect the country's economy at a time when borrowing conditions were extremely difficult, he added. Referring to the current model for growth in Greece, Papaconstantinou said that this was based chiefly on consumption fuelled by borrowing. He noted that the 2010 budget had allocated funds that boosted the income of groups with a high tendency for consumption but also allocated 10.3 billion euros for actions promoting development, noting that the funds freed from wasteful spending could be used to boost growth.

/... http://www.ana-mpa.gr/anaweb/user/showplain?maindoc=8391481&maindocimg=8375997&service=6

[Demeter]

67. Could Be

Although why is the question. There can't be that much nostalgia for multiple currencies.

[Robbien]

70. There's money to be made in shorting a country and hedges have their eyes on it

A good discussion of the issue is going on at Zero Hedge:
Two Hedge Funds One Bank? Is There A Concerted Effort To "Destroy" Greece?
http://www.zerohedge.com/article/two-hedge-funds-one-bank-there-concerted-effort-destroy-greece


Don't know what to think about that discussion and been letting it percolate for a while. And just recently the Financial Times has an article out saying:

Traders make $8bn bet against euro

By Peter Garnham, Victor Mallet and David Oakley in London

Published: February 8 2010 11:48 | Last updated: February 8 2010 19:03

Traders and hedge funds have bet nearly $8bn (€5.9bn) against the euro, amassing the biggest ever short position in the single currency on fears of a eurozone debt crisis.

Figures from the Chicago Mercantile Exchange, which are often used as a proxy of hedge fund activity, showed investors had increased their positions against the euro to record levels in the week to February 2.

The build-up in net short positions represents more than 40,000 contracts traded against the euro, equivalent to $7.6bn. It suggests investors are losing confidence in the single currency’s ability to withstand any contagion from Greece’s budget problems to other European countries.

Amid growing nervousness in financial markets over whether countries including Spain and Portugal can repair their public finances, Madrid on Monday launched a PR offensive to try to assuage investors’ fears.

more . . .
http://www.ft.com/cms/s/0/0330ba78-149f-11df-9ea1-00144feab49a.html

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

So how much of the Greek and Euro problem is real and how much is being manipulated by banksters is up for grabs in my estimation.

[Roland99]

56. No state income tax there. Casinos/hotels have driven tax revenue along w/property taxes

Casinos have been hit hard by the Great Recession and property values have sunk by at least half.

My gf was telling me of someone she knows that bought in 2006 or so for ~$425,000 and can't sell now unless they drop below $200,000 on the price.

[Dr.Phool]

64. My sister lives in Vegas.

Her and her husband were getting ready to buy a place, at the market peak, and the deal fell through. It seems he works for Countrywide, and he lost a lot of clients suddenly, when they tightened lending standards.

I guess they're lucky his job went to hell all of a sudden.

[Roland99]

65. It's probably not a bad time to buy there actually

I was checking homes in the Summerlin area (a nice part of town...NW of downtown...heading toward Red Rock) and 2,500 sq. ft. homes with 4BR/2.5BA and 2-car garages were listing for $175-180k.

Now if only prices of houses in my part of Orlando would hit that low, I'd definitely buy instead of looking to rent for another year!

[ozymandius]

7. Former Merrill chief (Thain) tapped to head CIT

LONDON (CNNMoney.com) -- Former Merrill Lynch CEO John Thain has been tapped to lead struggling lender CIT Group.

CIT (CIT, Fortune 500), the small business lender that emerged from bankruptcy in December, announced Sunday that it had chosen Thain to be its chairman and CEO.

Thain held the top post at Merrill before it was sold to Bank of America (BAC, Fortune 500) in September 2008 during the height of the financial crisis, a deal that Thain helped broker.

He left Bank of America in January of last year amid outrage over the deal and bonus controversy as well as reports of lavish spending, including reports that he had spent $1.22 million in early 2008 to redecorate his office at Merrill.

http://money.cnn.com/2010/02/08/news/companies/thain_cit/

---

Time to start a CIT death watch?

[Dr.Phool]

18. Start an office pool.

Date and next person to knock his lights out.

[ozymandius]

20. Did someone clobber him like they did Dick Fuld?

In either case - Hope springs eternal!

[Dr.Phool]

22. I had the two confused.

But, Thain looks like he could use a right cross or two.

[Demeter]

23. I Think Thain Sucker-Punched Himself

I'll wager he does it again within 6 months.


http://www.total-banker.com/#John_Thains_Wastebasket_

[AnneD]

24. I'm game for a phool....

And if memory serves me Thain was deck by an employee while he was on a tread mill at a gym in NYC. If that could happen every time I went to the gym....I might be more willing to sign up.:spray:

[MilesColtrane]

75. Dick Fuld?

Sounds like a bad medical condition.

[Po_d Mainiac]

35. Taking long positions in luxury bathroom fixtures..

and office furniture. By the time the suite is refurbished, CIT will be a penny stock, OTC listed.

[DemReadingDU]

40. CIT death watch?

It's been on life support for about a year now already

[Festivito]

8. Debt: 02/04/2010 12,346,427,470,024.01 (DOWN 7,613,584,822.89) (Thu)

(Down a little more. Debt seems to jump up big then drop slowly maybe up a little and down a little for days--repeat. Be well and have a good day.)

= Held by the Public + Intragovernmental(FICA)
= 7,840,400,752,727.59 + 4,506,026,717,296.42
DOWN 9,677,289,403.68 + UP 2,063,704,580.79

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 309-Million person America.
If every American, man, woman and child puts in $3.24 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.72, ABOUT TEN BUCKS for a 1B$ 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 10 seconds we net gain another American, so at the end of the workday of the report, there should be 308,651,358 people in America.
http://www.census.gov/population/www/popclockus.html ON 11/07/2009 08:19 -> 307,879,272
Currently, each of these Americans owe $40,001.21.
A family of three owes $120,003.63. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 2,443,013,555.08.
The average for the last 30 days would be 1,872,977,058.90.
The average for the last 31 days would be 1,812,558,444.09.
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$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 86 reports in 127 days of FY2010 averaging 5.08B$ per report, 3.44B$/day.
Above line should be okay

PROJECTION:
There are 1,081 days remaining in this Obama 1st term.
By that time the debt could be between 13.8 and 17.9T$.
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)
02/04/2010 12,346,427,470,024.01 BHO (UP 1,719,550,421,110.93 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +0,436,598,466,512.30 ------------* * * * * * * * * * BHO
Endof10 +1,254,790,868,322.75 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
01/14/2010 -025,105,278,682.17 -
01/15/2010 +057,080,501,160.91 ------------**********
01/19/2010 -000,292,818,574.91 --- Tue
01/20/2010 +001,498,198,188.82 ------------*********
01/21/2010 -031,161,420,148.11 -
01/22/2010 -000,070,049,877.74 ----
01/25/2010 -000,041,466,126.01 ---- Mon
01/26/2010 +000,973,181,275.87 ------------********
01/27/2010 +000,063,416,019.94 ------------*******
01/28/2010 -024,245,578,618.07 -
01/29/2010 -000,416,981,206.21 ---
02/01/2010 +090,319,223,365.33 ------------********** Mon
02/02/2010 -000,066,012,400.47 ----
02/03/2010 +000,334,538,130.44 ------------********
02/04/2010 -009,677,289,403.68 --

59,192,163,103.94 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(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=4257090&mesg_id=4257140

[Festivito]

57. Debt: 02/05/2010 12,345,510,656,150.03 (DOWN 916,813,873.98) (Fri)

(Down a tiny little bit. Debt seems to jump up big then drop slowly maybe up a little and down a little for days--repeat. Thanks for the heart whomever! I bet it's someone around here. Thanks. Good day all.)

= Held by the Public + Intragovernmental(FICA)
= 7,840,318,936,380.99 + 4,505,191,719,769.04
DOWN 81,816,346.60 + DOWN 834,997,527.38

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 309-Million person America.
If every American, man, woman and child puts in $3.24 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.72, ABOUT TEN BUCKS for a 1B$ 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 10 seconds we net gain another American, so at the end of the workday of the report, there should be 308,659,998 people in America.
http://www.census.gov/population/www/popclockus.html ON 11/07/2009 08:19 -> 307,879,272
Currently, each of these Americans owe $39,997.12.
A family of three owes $119,991.36. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 1,835,205,671.65.
The average for the last 30 days would be 1,406,991,014.93.
The average for the last 31 days would be 1,361,604,208.00.
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$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 87 reports in 128 days of FY2010 averaging 5.01B$ per report, 3.40B$/day.
Above line should be okay

PROJECTION:
There are 1,080 days remaining in this Obama 1st term.
By that time the debt could be between 13.8 and 17.9T$.
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)
02/05/2010 12,345,510,656,150.03 BHO (UP 1,718,633,607,236.95 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +0,435,681,652,638.30 ------------* * * * * * * * * * BHO
Endof10 +1,242,373,462,601.40 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
01/15/2010 +057,080,501,160.91 ------------**********
01/19/2010 -000,292,818,574.91 --- Tue
01/20/2010 +001,498,198,188.82 ------------*********
01/21/2010 -031,161,420,148.11 -
01/22/2010 -000,070,049,877.74 ----
01/25/2010 -000,041,466,126.01 ---- Mon
01/26/2010 +000,973,181,275.87 ------------********
01/27/2010 +000,063,416,019.94 ------------*******
01/28/2010 -024,245,578,618.07 -
01/29/2010 -000,416,981,206.21 ---
02/01/2010 +090,319,223,365.33 ------------********** Mon
02/02/2010 -000,066,012,400.47 ----
02/03/2010 +000,334,538,130.44 ------------********
02/04/2010 -009,677,289,403.68 --
02/05/2010 -000,081,816,346.60 ----

84,215,625,439.51 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(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=4260335&mesg_id=4260348

[ozymandius]

9. No Job Growth for Small Business Spurs Recovery Doubt (Update1)

Feb. 8 (Bloomberg) -- Small businesses are becoming the Achilles heel of the U.S. recovery by limiting growth and job creation.

Companies with fewer than 500 employees, such as Phoenix Technologies Ltd. and Sonic Corp., helped lead the economy out of the four recessions since 1980. This time, they continue to cut capital spending and dismiss workers, eliminating 3,000 jobs in January, according to Roseland, New Jersey-based Automatic Data Processing Inc., the world’s largest payroll processor. ....

The National Federation of Independent Business’s index of small-business optimism has been near historic lows for 15 consecutive months, declining to 88 in December from 88.3 in November, the federation reported Jan. 12. During the four prior recessions, it dipped below 90 only once. ....

The nation’s monthly payroll figures are inflated because the Labor Department model that estimates small-business hiring has overstated the number of jobs added during the recession, Shepherdson says.

According to the model, small companies created an average of 113,000 jobs a month from February through December -- a period when total employment fell by a nonseasonally adjusted 3.7 million, Labor Department statistics show.

The model “is creating jobs out of thin air that are not actually being generated,” Joshua Shapiro, chief U.S. economist at MFR Inc., an economic-consulting firm in New York, said in a Feb. 4 note to clients.

http://www.bloomberg.com/apps/news?pid=20601109&sid=apZULWyXpqhE&pos=10

[ozymandius]

10. Overhaul’s Failure Will Ignite U.S. Health Industry Mergers

....
With Congress’ sweeping overhaul of the health system stalled, industry will seek its own answers to a push by government and the private sector to rein in costs, said Curtis Lane, senior managing director at MTS Health Partners, a New York-based equity fund. An aging U.S. population will spur demand for services and, at the same time, boost pressure to control spending, he said.

One solution will be increased consolidation, with companies led by WellPoint Inc., the biggest U.S. insurer by enrollment, and Community Health Systems Inc., the largest publicly traded hospital chain, scooping up rivals unable to “spread rising costs across fewer customers,” said Paul Keckley, of the Deloitte Center for Health Solutions.

The health-care market “certainly seems to favor bigger, innovative, scalable companies,” said Keckley, executive director of the Washington-based center, in a phone interview. Drugmakers facing the loss of patent protection on top-selling medicines “were looking at decelerating revenues, with or without reform,” he said. ...

One in five working-age Americans lacked health coverage during the first half of 2009, the highest in six years, the U.S. Centers for Disease Control and Prevention said in a Dec. 16 report. Health-care spending last year reached an estimated $2.5 trillion, rising 6 percent from 2008, analysts with the U.S. Centers for Medicare and Medicaid Services said in another paper, released Feb. 4 in the journal “Health Affairs.”

The U.S. government faces pressure to slow the rise in health spending as it tries to plug a budget deficit projected to reach $1.6 trillion this year, said Deloitte’s Keckley. The overhaul bills included cuts of more than $120 billion over a decade to Medicare Advantage, a program that pays private insurers to provide benefits to the elderly. Obama also proposed a $20 billion increase in discounts drugmakers must give Medicaid, the joint U.S.-state health program for the poor.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aBiyYBTjExBI&pos=11

[ozymandius]

11. Goldman Sachs vs AIG

There is a huge front page article in the NYT discussing what we already know — that AIG extracted billions from AIG before ($5.9B) and after ($12.9B)their collapse.

We know that Goldie got paid 100 cents on the dollar post-bailout.But what insured party gets to set their own valuation of losses? According to the article, GS nabbed closer to 300 cents on the dollar pre-collapse of losses.

AIG balked, but the matter never seemed to be settled.

Lucky for Goldman we didn’t do an official reorg for this. Consider what the judge would have rightfully done in what should have been a very complex bankruptcy instead of a smash and grab.

Here’s the TImes:

“By July 2007, when Goldman demanded its first payment from A.I.G. — $1.8 billion — the investment bank had already taken trading positions that would pay out if the mortgage market weakened, according to seven former Goldman employees.

Still, Goldman’s initial call surprised A.I.G. officials, according to three A.I.G. employees with direct knowledge of the situation. The insurer put up $450 million on Aug. 10, 2007, to appease Goldman, but A.I.G. remained resistant in the following months and, according to internal messages, was convinced that Goldman was also pushing other trading partners to ask A.I.G. for payments . . ."

Now, AIG’s claims that it was Goldman that forced them into collapse, that “the payment demands were a major contributor to A.I.G.’s downfall,” are sheer nonsense. AIG wrote 3 trillion dollars worth of derivatives with precisely ZERO held in reserve. ....

---

Ritholtz's analysis
NY Times story

[Demeter]

15. So, Will GS or AIG Win in the Battle for the Meme?

If GS has finished hollowing itself out with ridiculous bonus and salary packages, maybe we will be rid of BOTH of them!

[truedelphi]

62. It is just business as usual.

The _uckwads doing this through legal maneuvers are considered valuable players by the financial firms.

[ozymandius]

12. Mortgage Bankers Association Sells Headquarters at Big Loss

....
On Friday, CoStar Group Inc., a provider of commercial real estate data, announced that it had agreed to buy the MBA's 10-story headquarters building in Washington, D.C., for $41.3 million. The price is far below the $79 million the trade group says it paid for the glass-walled building in 2007, while it was still under construction. The price also is far below the $75 million financing that the MBA received from a group of banks led by PNC Financial Services Group Inc. to finance the purchase.

John Courson, chief executive officer of the trade group, declined in an interview Saturday to say whether the MBA would pay off the full loan amount. "We're not going to discuss the financing," he said. A spokeswoman for the MBA added that the MBA has reached "an agreement with all relevant parties" regarding the outstanding amount on that loan but declined to provide any details. ....

When the MBA announced the purchase of the building in early 2007, the trade group's president at the time, Jonathan Kempner, said: "We have come to the inescapable conclusion that owning our own building was the smartest long-term investment for the association." In October 2009, however, the MBA informed its members that it had put the building up for sale. At that time, the MBA said that continued ownership of the building, which was financed with $75 million of variable-rate debt, would be "economically imprudent."

http://online.wsj.com/article/SB10001424052748704829704575049111428912890.html

---

Jeebus! And this was a mortgage banking leadership group? THE mortgage banking leadership group?!? They bought at the top of the market. They financed with a variable rate mortgage. Leadership considered the purchase a long term investment. The stupidity hurts.

[Demeter]

14. I've Never Seen It Fail, Though

The way to spot the next hi-tech company going out of business was to read up on groundbreaking ceremonies, back in the 80's, when we still had high tech in this country.


It's Called the Edifice Complex

[Demeter]

13. I'm Getting Really Tired of Winter, Ozy.

It's 10F. I should be grateful that it's + and not -10, but honestly, if I wanted this kind of winter, I'd live further north...


Getting really tired of the Democrats, especially the leadership, too. If I wanted Bush III, I would have voted for McCain.


I guess I'm just tired. If this is old age, I've had enough of that, too.

[ozymandius]

19. Tired, too.

I have a list of expenses - both current and pending - next to my keyboard. I have a payday schedule too. Maybe I will get to touch the money for awhile before it is whisked away. Winter has stolen more than its fair share due to utility bills.

I remember the last big El Niño event in 1995. My heating bills average around $30 during that brutal Winter. This was before the natural gas industry was deregulated in Georgia. The average bill before deregulation was $20. One month after deregulation - the bill climbed to $40. Fast forward: The bill for one month in 2009 is $160.

It seems of late that any ambition to put a little away for emergencies and fun is all for naught. We have shed debt. i have found a satisfying career that places the ozymandius household firmly in the middle class bracket. Yet we find that the world has ways to increase financial stress. So I am ready for Winter to be done. At least, come Spring, I can start working in the garden again.

I am sorry, Demeter, that circumstances are so harsh for you and yours. Cold of that intensity and duration can really sap one's spirit.

[Dr.Phool]

21. Here's a little inside article on the "Leadership".

http://tpmcafe.talkingpointsmemo.com/2010/02/07/core_chicago_team_sinking_obama_presidency/?ref=fpblg

[Roland99]

42. I was complaining this morning of the chilly 43F. Not sure we're hitting 70s this week

boo hiss!!

Yeah, this is my first winter away from the cold and snow and still too cold here. Too bad Orlando isn't about as far south as Ft Myers. :)

[amandabeech]

48. You speak for many of us, Demeter.

I'm just sick of everything--it all just seems like a giant rerun of the last 25 years.

If I wanted all this snow here in DC, I would've stayed in Michigan. Or I'd move to Minneapolis.

[Demeter]

68. there Is NO Snow Here in Michigan

although that may have changed by tomorrow.

[amandabeech]

71. Your time will come. It always does! n/t

[Wizard777]

16. I feel this would be better titled as The Shock Market Watch

:shrug: Sounds about right to me.

[ozymandius]

25. Krugman: America Is Not Yet Lost

...
What we’re getting instead is less a tragedy than a deadly farce. Instead of fraying under the strain of imperial overstretch, we’re paralyzed by procedure. Instead of re-enacting the decline and fall of Rome, we’re re-enacting the dissolution of 18th-century Poland.

A brief history lesson: In the 17th and 18th centuries, the Polish legislature, the Sejm, operated on the unanimity principle: any member could nullify legislation by shouting “I do not allow!” This made the nation largely ungovernable, and neighboring regimes began hacking off pieces of its territory. By 1795 Poland had disappeared, not to re-emerge for more than a century. ...

What gives individual senators this kind of power? Much of the Senate’s business relies on unanimous consent: it’s difficult to get anything done unless everyone agrees on procedure. And a tradition has grown up under which senators, in return for not gumming up everything, get the right to block nominees they don’t like.

In the past, holds were used sparingly. That’s because, as a Congressional Research Service report on the practice says, the Senate used to be ruled by “traditions of comity, courtesy, reciprocity, and accommodation.” But that was then. Rules that used to be workable have become crippling now that one of the nation’s major political parties has descended into nihilism, seeing no harm — in fact, political dividends — in making the nation ungovernable. ...

The truth is that given the state of American politics, the way the Senate works is no longer consistent with a functioning government. Senators themselves should recognize this fact and push through changes in those rules, including eliminating or at least limiting the filibuster. This is something they could and should do, by majority vote, on the first day of the next Senate session.

http://www.nytimes.com/2010/02/08/opinion/08krugman.html?ref=opinion

---

Becoming his intellect: Krugman cautions "Don’t hold your breath."

[Demeter]

32. Krugman: Comedian or Optimist?

you decide.

[FarCenter]

44. There are parallels with the Austro-Hungarian Empire during the late 19th Century

In particular, the aged Emperor Franz Joseph presided over two parliaments -- Austrian and Hungarian -- with the result that nothing much got done.

Their stifling bureacracies, military that spent a lot on traditional arms, ethnic divisions, divisions by class and wealth, adherence to traditional religion, and the romantic and impractical outlook of those in power are all parallels in the political and social fields.

On the other hand, our technological and economic stagnation are more akin to that of the Britsh Empire during the Long Depression 1873-1896.

[Hawkowl]

55. The solution is dissolution

Historically speaking, when an empire like the USA reaches this level of stagnation, it fractures into smaller more manageable, functional political entities. Rome split into west and Byzantine; the British split into the Commonwealth, the Soviet Union into the CIS. Of course an outlier would be China, but China is a very, very, old culture and it maintained its stagnant integrity for a long time only to fall way behind technologically and then to be divided into spheres of influence by the Western powers.

In any case, unless Obama morphs into Marcus Aurelius, this country is FINISHED. Personally I think it's time to start thinking about emigrating. If the worst happens, do you want to be living in a reprise of the 1930's Third Reich?

[Demeter]

28. Chinese province raises wages 13%

http://www.ft.com/cms/s/0/fa86afe4-1418-11df-8847-00144feab49a.html

A decision by the province that is China’s second-biggest exporter to raise minimum wage rates has heightened expectations that other provinces and cities will soon follow, just as the central government’s attention is shifting from economic stimulus to rising inflation.

Eastern Jiangsu province, which exports more than Brazil and South Africa combined, raised its monthly minimum wage rate 13 per cent to Rmb960 ($140) last week. It was the first time the rate had been adjusted in two years.

The potential round of minimum wage increases comes amid signs that inflationary pressures are picking up in the Chinese economy after a rapid recovery in the second half of 2009, fuelled by a huge government stimulus programme. Government officials are debating whether to slow the pace of new loans and begin appreciating the currency to dampen inflationary expectations.

“This could be a red flag about wage inflation,” says Arthur Kroeber, editor of China Economic Quarterly. “Inflation in China is becoming systemic because of rising wages caused by a tighter labour market.”

In the immediate aftermath of the global financial crisis last year, local governments were reluctant to raise wage rates and put extra strain on already struggling factories. But now that officials are confident the worst is over for China’s export sector, they are more willing to address workers’ concerns.

“The economy is picking up again,” said Geoffrey Crothall, of the Hong Kong-based China Labour Bulletin. “Inflation and basic cost of living are increasing. It’s clearly in local governments’ interests to make some accommodation.”

Jiangsu’s adjustment of the highly symbolic minimum wage also reflects growing competition among different regions to attract migrant workers after the Chinese new year holiday, next week. Neighbouring Shanghai is expected to raise its rate by double-digits on April 1.

Beijing and cities in southern Guangdong province, the country’s biggest exporter, are considering adjustments. Deputies to Guangdong’s people’s congress have even suggested linking minimum wage levels to the consumer price index.

The consumer price index rose from 0.7 per cent in November to 1.9 per cent in December, which some economists believe is the start of a concerted rise in inflation. However, some analysts said the sharp jump in inflation could have been the temporary result of severe winter weather on vegetable prices and that inflation for January, which will be announced this week, will have moderated.

An estimated 20m migrants did not have jobs to return to after the country’s biggest holiday last year, as overseas retailers ran down their stockpiles and factories closed. But after orders began to recover during the summer, most migrants seeking work in coastal manufacturing zones were able to find jobs and local officials began to fret about incipient labour “shortages”.

“We have trouble getting staff because other factories keep popping up and offering workers as many hours as they want,” said one manager, whose Guangdong factories supply Walmart and other brand-name retailers. “Workers don’t want to waste time sitting on their butts when they could be making more money at another factory.”

[ozymandius]

30. "You Rock"

Thank you, whoever you are, for the heart. :yourock:

Time for me to leave. Have a nice day, everyone! :hi:

:donut: :donut: :donut:

[Hugin]

38. Have a great day, Ozy. nt

[Robbien]

31. The OTHER Reason that the U.S. is Not Regulating Wall Street

Sure, American politicians have been bought and paid for by the Wall Street giants. See this, this and this.

And everyone knows that the White House and Congress – while talking about cracking down on Wall Street with strict regulation – have actually watered down some of the most important protections that were in place.

For example, Senator Cantwell says that the new derivatives legislation is weaker than the old regulation. And leading credit default swap expert Satyajit Das says that the new credit default swap regulations not only won’t help stabilize the economy, they might actually help to destabilize it.

But the U.S. is not being sold out in a vacuum.

On March 1, 1999, countries accounting for more than 90 per cent of the global financial services market signed onto the World Trade Organization’s Financial Services Agreement (FSA). By signing the FSA, they committed to deregulate their financial markets.

For example, by signing the FSA, the U.S. agreed not to break up too big to fails. The U.S. also promised to repeal Glass-Steagall, and did so 8 months after signing the FSA.

Indeed, in signing the FSA and other WTO agreements, the U.S. has legally bound itself as follows:

• No new regulation: The United States agreed to a “standstill provision” that requires that we not create new regulations (or reverse liberalization) for the list of financial services bound to comply with WTO rules. Given that the United States has made broad WTO financial services commitments – and thus is forbidden by this provision from imposing new regulations in these many areas – this provision seriously limits the policy available to address the current crisis.

• Removal of regulation: The United States even agreed to try to even eliminate domestic financial service regulatory policies that meet GATS rules, but that may still “adversely affect the ability of financial service suppliers of any other (WTO) Member to operate, compete, or enter” the market.

• No bans on new financial service “products”: The United States is also bound to ensure that foreign financial service suppliers are permitted “to offer in its territory any new financial service,” a direct conflict with the various proposals to limit various risky investment instruments, such as certain types of derivatives.

• Certain forms of regulation banned outright: The United States agreed that it would not set limits on the size, corporate form or other characteristics of foreign firms in the broad array of financial services it signed up to WTO strictures …

• Treating foreign and domestic firms alike is not sufficient: The GATS market-access limits on U.S. domestic regulation apply in absolute terms; that is to say, even if a policy applies to domestic and foreign firms alike, if it goes beyond what WTO rules permit, it is forbidden. And, forms of regulation not outright banned by the market-access requirements must not inadvertently “modify the conditions of competition in favor of services or service suppliers” of the United States, even if they apply identically to foreign and domestic firms.

In other words, the problem isn’t just that Congress and the White House have sold out to the Wall Street giants.

The problem is also that the U.S. has signed WTO agreements that have given the keys to the too big to fails, and have neutered their regulators. Even if some politicians tried to stand up to Wall Street – or even if we “throw out all of the bums” currently in political roles – the U.S. would still be locked into the WTO’s scheme for helping the financial giants to grow ever bigger and to take ever-bigger and ever-riskier gambles.

Indeed, the financial giants are pushing hard for further deregulation, demanding that the WTO’s “Doha round” of agreements be signed.

http://www.nakedcapitalism.com/2010/02/guest-post-the-other-reason-that-the-u-s-is-not-regulating-wall-street.html


Every proposed bill which even pretends to regulate banksters is all for show. All this reform they keep talking about is just politicians posturing for the cameras.

[Demeter]

33. This Is Monstrous!

It's a conspiracy on a global level, and our "leaders" are either too corrupt or too ignorant to choose to refuse.

[Robbien]

36. Sure nuff

Pretty discouraging ain't it?

And it answers my question on an article I read this weekend about "FTC Pushes For Tighter Rules On Faux Mod Providers"

http://www.mortgageorb.com/e107_plugins/content/content.php?content.5221



Basically the new rule says people who provide foreclosure consulting services cannot lie cheat or steal from their customers. Now why would we need a rule to make illegal something that is already illegal I wondered.

In the small print were the words "The proposed rules generally exempt entities that own or service mortgage loans. "

So the rule doesn't make illegal acts illegal as the hype says. It is not trying to protect the customer. With that exemption, the rule's sole purpose is to make illegal acts legal for banksters.

Just more deregulation going on.

[Dr.Phool]

39. Jesus Fucking Christ.

That should be posted in Editorials for some wider exposure.

First order of business must be withdraw from the WTO and NAFTA.

[Robbien]

45. Done

Funny, the WTO is making Japan deregulate and the news is in all their papers. Here we've been under this rule since 1999 and no one knows.

[Dr.Phool]

51. Denninger says FSA amendment never ratified.

http://market-ticker.denninger.net/archives/1946-Hmmm...-Do-We-Need-To-Guillotine-The-WTO.html


(snip)

Yes, we could simply tell the WTO to get stuffed, and I can make a cogent argument that we should - for a number of reasons, not the least of which is that "free trade" doesn't make allowance for those working under literal (or near-literal) slave conditions, such as Chinese and Vietnamese workers who are working under effective conditions of indentured servitude and lack the human and labor rights protections we enjoy in civilized nations. "Competing" with a labor source that effectively has a gun in its mouth is not only impossible, the concept is idiotic on its face.

But that's irrelevant to the argument that "we were forced by treaty to deregulate." Among other things deregulation does not mean legalizing fraud and never has.

Second, the WTO's "FSA" appears to have never been sent to Congress and thus has no force of law as a treaty. It is a mere "suggestion" - and one that Congress has every right to ignore, as do our regulators, as under The Constitution all Treaties must be ratified by The Senate - without that consent any purported "international agreement" is of no legal force whatsoever. Treaties cannot be amended once voted upon without being subjected to a second vote (and possible refusal); the FSA was an amendment to an existing treaty, and thus without being considered by The Senate is a nullity in terms of actual United States obligations.

The "globalists" (and scaremongers who believe we have sold out to them) would have you believe that we have somehow obligated ourselves. This is false. We have done no such thing, and whether our government has complied with these wishes (some would say demands) out of a desire to appease those who have bribed legislators with million in campaign contributions the fact remains that when it comes to legal force of law in this regard there is none.

This, by the way, includes the WTO, which has a nice list including the US on the web page referenced above. That too is, as far as I can determine, a lie as the FSA was never put to Senate Ratification, and without that having occurred it is legally void, whether the WTO likes it or not.

(PS: For those who wish to argue that the Republicans are to blame for all of the world's ills, you should look into who was President when the negotiations too place on the predicate parts of the treaty that was ratified prior to the FSA "add-on" that has no force of law. Hint: He tried to hide what he had spilled on a particular blue dress.)

[Robbien]

52. While Congress may not have signed on to the WTO's Doha FSA

Congress has signed on to the almost exact same deregulation language in all the many FTAs we have around the world (called GATS I believe which is to be enforced by the WTO).

This Doha WTO FSA would make the deregulation a global thing, all encompassing.


The only nit I have to pick with Denninger is that he keeps getting stuck on party affiliation, as if that makes any difference. Carter started the deregulation ball rolling in the 70's and each president since then has done his best to make the ball bigger and rolling faster.

[Dr.Phool]

58. Oh, I have lots of nits to pick with Denninger.

He's a libertarian tea-bagger, with s few brains and money. But, he's a good source for some inside news and perspective. Solutions, not so much.

Like most people, this is the first I'd heard of any of this. It needs to be spread far and wide. And until WTO and a host of other free trade agreements are repealed, we're at the mercy of these bloodsuckers. And I seriously doubt that most of Congress is aware of it either. Most legislation, seems to be written by lobbyists, and just handed to a congressional sponsor.

[Robbien]

34. Want a Weather Forecast? Ask Wall Street

Lefkof is a meteorologist, but you won't find the 41-year-old answering phones at the National Weather Service or flashing a toothy grin as the weatherman on your local TV news.

Lefkof runs with a different crowd, the sort that risks millions of dollars on the kinds of predictions Lefkof makes every day.

He works for a bank.

Lefkof is a Houston-based meteorologist at Deutsche Bank's commodity trading business.

. . .

Commodities aren't the only way to make weather plays. In 1999, the Chicago Mercantile Exchange established weather products -- investing instruments based entirely on weather predictions, including temperature, hurricanes, snowfall and frost.

Such instruments, often known as weather derivatives, are about more than just making a bet on the rise or fall of the mercury. Businesses ranging from utilities to snow mobile manufacturers can use weather investments to hedge against climate conditions that they know could cost them money, said Felix Carabello, director of Alternative Investment Products at the CME.

http://abcnews.go.com/Business/weather-forecast-wall-street/story?id=9757635

[UpInArms]

37. dollar watch

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

Last trade 80.282 Change -0.098 (-0.13%)

Bank Research Consensus Weekly 02.08.10

http://www.dailyfx.com/forex/fundamental/bank_research/2010-02-08-0539-Bank_Research_Consensus_Weekly_02_08_10.html

Reining in the Front-Riders

Manoj Pradhan, Global Economics Team, Morgan Stanley

Today, Norges Bank (NB), which along with the Bank of Israel (BoI) and the Reserve Bank of Australia (RBA) had started the global rate hike cycle late last year, kept its policy rate steady. Likewise, on Tuesday the RBA refrained from hiking its policy rate for a fourth time, which came as a surprise to markets. These are not isolated incidents, in our view. All the central banks who either had embarked on removing policy accommodation in 2009, such as the BoI, the RBA and NB, or were expected to begin raising rates early in 1Q10, such as the Reserve Bank of India (RBI) and the Bank of Korea (BoK), have refrained from hiking policy rates in their meetings so far this year. Korea's strong recovery and extremely low policy rates, and India's economic bounce and the risk of inflation made the central banks of these two economies front-runners for hiking policy rates in early 2010.

<snip>


FX: Greece Still Centre Stage

Arne Lohmann Rasmussen, Chief Analyst, Danske Bank

Greece is continuing to write the script in the FX market, and the EUR is continuing to struggle. Things did look up briefly midweek when the European Commission gave the green light to the Greek stability programme, but the market has its doubts about the plan and Greek government bonds are still under considerable pressure.

The pressure on the EUR has been unrelenting, and the EUR/USD has now fallen to its lowest level since May 2009 when the financial crisis was still raging. Looking at the chart on the right showing the Greek-German 10Y yield spread, one might almost thin that this is the only factor of any significance for the FX market at the moment.

<snip>


Expect the Unexpected in Australia

John E. Silvia, Ph.D. Chief Economist, Wachovia

The global financial crisis in late 2008 and early 2009 may have knocked just about every developed economy in the world off its feet, but it clearly missed a tackle with Australia. After a stutter step in the third quarter of 2008, Australian GDP has posted positive economic growth for three consecutive quarters. The recovery was so well on track that the Reserve Bank of Australia (RBA) was among the first central banks to begin raising rates. In fact, earlier this week analysts were taken by surprise when the RBA unexpectedly left rates untouched.

<snip>


United States - Jobs: Come Out, Come Out Wherever you are

James Marple, Senior Economist, TD Bank Financial Group

This week could be summed up in one word – jobs. Jobs and how to create them were a focus of President Obama’s budget released on Monday and stayed in the limelight through Friday with the release of the January jobs report. While there have been a number of hopeful signs that job growth is just around the corner (for more see our report, U.S. Won’t Have a Jobless Recovery), we didn’t quite make it there in January, and U.S. payrolls fell by 20,000 in the month. Nonetheless, despite the (marginally) negative number, the details of the jobs report were actually very positive. First, it is important to note that given the total size of the U.S. jobs market (127 million), a loss of 20,000 represents a change in percentage point terms of -0.015%. Moreover, this is well within the standard statistical error of the survey and could well be revised away in future estimates. Indeed, somewhat puzzlingly, while the payrolls report showed job losses, the unemployment rate still fell by 0.3 percentage points to 9.7%. While this can occur when employment is falling as long as the labor force is also shrinking, this was not the case in January. Instead, the difference was due to an unusually large discrepancy in employment reported in the household survey (used to calculate the unemployment rate) and the establishment survey. While we could spend the rest of this Bottom Line talking about differences in survey methodology, in an effort to keep my readership numbers up, let’s instead focus on some of the other more tantalizing details of the reports.

...more...

US Dollar Extends its Run but How Long will Risk Aversion Hold?

http://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2010-02-06-0237-US_Dollar_Extends_its_Run.html

Considering the extraordinary rally the dollar was able to muster this past week, and the momentum it has added to the currency’s impressive bull trend; it may seem inappropriate to start speculating on when this drive will stall. However, it is vital to always have a view on the life span of a trend. Otherwise, how would we know when to take profit or otherwise stick it out for the full breadth of a developing move? The primary fundamental drive behind the dollar’s current run is a deep source of momentum. The reversal of risk flows in the financial markets can last for some time and entail substantial shifts in underlying capital. Throughout 2009, investors were looking to reinvest their speculative capital that had been idled by the worst financial crisis in memory. From cash and other ‘risk-free’ assets, investors were looking to first put their money back to work and second to avoid excessively risky markets. This meant a large influx of capital into specific markets. Naturally, a bottleneck of liquidity would form; and asset prices would rise dramatically in response. And, though values were undoubtedly depressed when the market’s first reversed higher in the beginning of the year, they were equally overinflated by the end of the year. What we are experiencing now is a move to find an equilibrium that is supported by the potential for growth and expectations for returns. This brings us to the critical question: how much excessive premium is there left to work down?

It is a complicated task to determine when the markets are fundamentally overbought or oversold – especially in the time frame of just the forthcoming week. There has been a move to deflate risk in the capital markets for approximately three weeks now; and the progress that some benchmarks (like the Dow) have made is very modest compared to the initial buildup. For this reason alone, it is reasonable to assume that a natural retracement can develop for a considerable time. However, for the dollar, the currency has already retraced more than 50 percent of its losses against the euro since its early-December reversal. As long as the risk aversion trend maintains its momentum, the greenback will benefit; but the amplitude of the currency’s move can diminish. A market flow reason for this is that the market may be comfortable in reinvesting in safe havens other than the US dollar and Treasuries. Another factor in this move is that carry positions that were funded using the US dollar (which has the lowest three-month Libor rates among its major peers) are being unwound and capital is being repatriated to the US. In near-term, the bearing on sentiment will depend on the catalysts available and the ease in developing trends. The focus will remain on big-ticket concerns like sovereign debt risk, efforts to curb speculation and the focus on potential points of systemic risk. And, with a relatively light scheduled docket, there may be little standing of the way of such trends.

The dollar’s broader trend will be defined by the general quality and direction of risk appetite; but in the end, this will be developed through the unpredictable nature of group fear and greed rather than any definable economic indicators. Among the few definable drivers that can have a meaningful effect on the sense of risk appetite for the global markets are the first readings of 4Q GDP numbers for the European region and Fed testimony on systemic risks. Other scheduled indicators like the advanced retail sales report, University of Michigan consumer confidence survey and trade balance will likely play a reduced role with short-term volatility.



...more...

[mrdmk]

41. self-serving thread advertisment

Heck, everyone needs to promote themselves once in a while, even Goldman Sachs!

link: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x7661364

[Roland99]

43. 9:55am - Not a good start

Dow 9,946 -66 -0.66%
Nasdaq 2,135 -6 -0.28%
S&P 500 1,062 -4 -0.37%
GlobalDow 1,829 -7 -0.39%
Gold 1,065 +12 +1.11%
Oil 71.45 +0.26 +0.37%

[Roland99]

53. 1:59pm - About the same (and thanks for the heart!)

Dow 9,970 -43 -0.42%
Nasdaq 2,140 -1 -0.05%
S&P 500 1,064 -2 -0.21%
GlobalDow 1,834 -2 -0.13%
Gold 1,066 +13 +1.27%
Oil 71.38 +0.19 +0.27%

[Robbien]

47. Société Générale thinks it is slandering its fired hedge funder

Société Générale's TCW fired its distressed fund hedge funder and is suing him for poaching their customers. In addition:

TCW, for its part, has sought to sully its former star’s reputation. In its lawsuit, the firm alleges that it found marijuana, drug paraphernalia, 34 “hardcore” pornographic magazines, 36 pornographic DVDs and videos and “a collection of 12 sexual devices” in Gundlach’s former office following his ouster.

http://www.finalternatives.com/node/11317


IMO it be unusual if any desk in the hedge fund division wasn't loaded up with all that stuff. The only unusual thing is that the guy left the goodies behind when he left. Perhaps his new place has better stuff.

[Demeter]

50. My Goodness! Thank You All For The Hearts!

They are just multiplying!

[Tansy_Gold]

69. Y'all have left me utterly flabbergasted, too!

How weird it is that even though most of us have never met face to face, just our words and thoughts have prompted these outpourings of affection/respect/recognition.

To all of you here on SMW and WEE, whether you gave me a heart or not, whether I gave you one or not, this is a very special community to me. I love you all! (well, except for "ignored"......)


:grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock::grouphug: :yourock:

[Robbien]

54. Pay Borrowers to Pay Their Mortgage?

How do you get borrowers to avoid walking away from homes that are deeply underwater without encouraging more to follow by writing down principal balances? One idea: Pay them to keep paying their mortgage.

The novel approach is being touted by Loan Value Group LLC, a firm selling their idea—and ready-made application—to mortgage investors nervous about the risk of strategic default, where borrowers walk away from their homes even though they can afford to pay their mortgages. The firm says it’s signed up an undisclosed mortgage investor to test a pilot program with a few hundred borrowers.

Here’s how the program works: The mortgage investor (possibly joining with other risk holders, such as mortgage insurers or second-mortgage holders) offers a cash reward to borrowers if they agree to keep paying their mortgage. The incentive amount varies by borrower depending on income, negative equity, geography and other risk factors—those who are more likely to cause steep losses receive a bigger carrot. The “responsible homeowner reward” grows for up to five years as the borrower makes monthly mortgage payments.

The borrower can’t collect that cash payment until the mortgage is paid off (though investors could allow the reward to be used towards paying off the mortgage in a sale or refinancing if the reward amount is enough to close the transaction).

. . .

The size of the reward isn’t going to make up for the borrower’s entire negative equity whole, but Mr. Pallotta says the incentive payments are designed to present enough of a “shock-and-awe number upfront” to change the borrower’s psychology. Instead of thinking about how much debt they’re getting out of by walking away, maybe some borrowers will think about the cash bonus they’ll get if they stay current and are able to recover their equity if home prices stabilize and recover.

http://blogs.wsj.com/developments/2010/02/08/pay-borrowers-to-pay-their-mortgage/


If one is scared enough about housing prices to seriously think about walking away from their home, a small shock and awe payment sometime in the far away future isn't going to change their mind I don't think.

[Dr.Phool]

59. "The borrower can't collect until the mortgage is paid off".

Not much incentive.

[TalkingDog]

60. In for the finish....no bouncy joy today.....

Dow down almost 100 points....
Nasdaq down...
S&P down....

And the 2nd snowstorm hasn't even further paralyzed the NE.

[Dr.Phool]

61. Quick 50pt dive at the close.

[Robbien]

66. Tyler Durden over at Zero Hedge is saying the carry trade imploded

precipitating a robotic selling into the close. Over there the thought is the dead cat has stopped bouncing. All nine lives have been used up.

Kinda feels that way to me also. :shrug:

[fan of the arts]

72. Nothing is corrupt at all, I'm looking to buy Buy BUY!

I have full trust in lying sociopath CEO greed-pigs to look out for my investment in their preordained position as a superior capitalist education inbred whos eyes are so close together it's like looking at a cyclops.

Yes, I'm bought and sold in every way, I have no ability to see a damn thing other than dollar signs. No need to think, thinking is bad, greed is good. There is no need to ever listen to anyone or learn anything.

[Demeter]

73. A Big Bowl of Chocolate Ice Cream and a Lie Down Under an Electric Blanket

and a double dose of B vitamins, and you will feel like life is worth living another day...

[DemReadingDU]

74. Hot Chocolate works well too

and lots of Vit C shortens duration of colds for me

See ya tomorrow!