STOCK MARKET WATCH, Monday June 21

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday June 21, 2010

AT THE CLOSING BELL ON June 18, 2010

Dow... 10,450.64 +16.47 (+0.16%)
Nasdaq... 2,309.80 UNCH (UNCH)
S&P 500... 1,117.51 +1.47 (+0.13%)
Gold future... 1,261 +2.30 (+0.18%)
10-Yr Bond... 3.30 +0.07 (+2.23%)
30-Year Bond 4.22 +0.07 (+1.78%)

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Market Conditions During Trading Hours

Euro, Yen, Loonie, Silver and Gold

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Handy Links - Market Data and News:Economic Calendar    Marketwatch Data    Bloomberg Economic News    Yahoo! Finance    Google Finance    Bank Tracker    
Credit Union Tracker    Daily Job Cuts

Handy Links - Economic Blogs:
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Brad DeLong      Bonddad    Atrios    goldmansachs666    The Stand-Up Economist

Handy Links - Government Issues:
LegitGov    Open Government    Earmark Database    USA spending.gov

Handy Links - Videos:
The Coming Collapse of the Middle Class    Charlie Rose talks with Roubini    Charlie Rose talks with Krugman
    William Black: This Economic Disaster    Bill Moyers with Kevin Drum and David Corn

Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren

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

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

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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. no goobermental reports today n/t

[Demeter]

2. First Rec!

I've got a busy day and a busy week, don't know how much I'll be around.

At least the weather is bearable.

[ozymandius]

5. Good morning, Demeter.

:donut: :donut: :donut:
That's good news about the weather. Down here, we expect highs to be in the mid 90s with lousy air quality.

[Roland99]

45. y'all see this one?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x8603151


:)

[ozymandius]

3. Oil jumps above $78 as China lifts currency peg

MOSCOW – Oil prices surged high above $78 a barrel Monday as China's move to end its two-year peg to the dollar boosted investor confidence in the global recovery and oil demand.

China's exchange rate strengthened Monday while the central bank warned the value of the yuan would not dramatically rise due to the greater flexibility on its exchange rate.

Traders anticipate a stronger yuan will make dollar-based commodities such as oil cheaper in China and bolster demand. The policy shift also suggests China's officials believe its economy is growing enough to absorb any slowdown in exports a stronger currency may cause.

Other observers noted that Monday's surge in oil prices does not have solid fundamentals behind it.

In other Nymex trading, heating oil rose 3.42 cents to $2.1631 a gallon, gasoline gained 3.25 cents to $2.1801 a gallon and natural gas jumped 10.2 cents to $5.099 per 1,000 cubic feet.

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

[Demeter]

4. Rumors Swirl About Rahm's Imminent Exit

Got my fingers, toes, arms, legs and eyes crossed...

[ozymandius]

6. Great!

I'm very hopeful that blue dog recruiter/enabler may be out.

[DemReadingDU]

7. Imminent? I thought I read he would leave after the Nov elections

:shrug:

[Demeter]

9. Now It Sounds Like Before.

Only 2 years too late, IMO. He should have been thrown out of Congress...

Daily Beast:

Report: Rahm Emanuel to Quit

Thought it must be taken with a grain of salt, Washington insiders have reportedly told the Daily Telegraph that President Obama's Chief of Staff Rahm Emanuel will very likely quit, and soon. An anonymous leading Democratic consultant bets Rahm will leave "after the midterms" telling the British paper, "Nobody thinks it's working but they can't get rid of him—that would look awful. He needs the right sort of job to go to but the consensus is he'll go." Reasons for Rahm's departure include his often discordant relationship with Obama and his concern over burning out and missing out on time with his family because of the job's demands. "Democrats have not stood behind the president in the way Republicans did for George W. Bush," said the source, "and that was meant to be Rahm's job."

http://www.telegraph.co.uk/news/worldnews/northamerica/7837686/Rahm-Emanuel-expected-to-quit-White-House.html

THE NEXT PARAGRAPH IS CLASSIC--HE WANTS TO SPEND MORE TIME WITH HIS FAMILY!!!
:rofl:

Rahm Emanuel expected to quit White House
Rahm Emanuel, the White House chief of staff, is expected to leave his job later this year after growing tired of the "idealism" of Barack Obama's inner circle...

Washington insiders say he will quit within six to eight months in frustration at their unwillingness to "bang heads together" to get policy pushed through.

Mr Emanuel, 50, enjoys a good working relationship with Mr Obama but they are understood to have reached an understanding that differences over style mean he will serve only half the full four-year term...

I AM SAYING BEFORE, BECAUSE THE KNIVES ARE OUT FOR RAHM, AND NOT JUST AT THE GRASSROOTS. WHAT WORRIES ME, IS: WHO IS STRONG ENOUGH TO BE PUSHING RAHM OUT, AND WHY DID THEY WAIT SO LONG?

RAHM'S "LEADERSHIP" IN THE SPECIAL ELECTIONS AND PRIMARIES HAS BEEN A COMPLETE FAILURE. AND SOMEBODY IN POWER NOTICED. THE POLLING MUST BE REALLY BAD ON THE HEALTH CARE DEFORM AND THE WAR EFFORTS AND THE BAILOUTS, AND THE LACK OF ANYTHING ELSE.

frequently edited because I can neither type fast nor think fast at this hour of the day....

[Hawkowl]

37. Way before

Once you get a leak like that, it is ALWAYS sooner rather than later. No reason to float the idea 5 months before and completely undercut Rahm's political clout, unless you want him out pronto.

[Demeter]

8. A Call for New Taxes By Bill Baker

http://dailyreckoning.com/a-call-for-new-taxes/

In Roman times, the elite aristocracy paid no taxes but was expected to build walls, aqueducts, or other public works periodically, while the populace was mercilessly taxed.

What is the difference between the modern structure wherein foundations are a tax dodge, and the taxes of small businessmen are higher than they otherwise would be to subsidize the deification of the über-rich through monuments to their generosity, or worse, their political ideals, especially when these are anti-American? Why should not the upper – middle class be livid?

TAKE THAT, BILL GATES AND THE 50%-ERS!

Certainly the richest of society should be praised for philanthropy. But to accomplish this through shifting economic resources away from the middle class is demoralizing and destructive to our economic fabric.

To push the concept to the max by calling for higher marginal tax rates, whose full effect is felt by small businessmen, and insisting they are advocates of social justice is a shameless deception. F. Scott Fitzgerald was right that the rich are different from you and me, but he could have added that the difference is not softness but arrogance, for they can manipulate the strings of government to their benefit just as their Roman counterparts did nearly two millennia ago.

A call for new taxes on the top layers has been workable historically when small amounts of new spending are required, but if a crisis such as a war or the default of government-backed banks or mortgages triggers a massive need for funding, someone astute might notice that the socialist scheme to confine the new burden upon just the rich might fail.

It would not fail because a sleepwalking Congress did or did not act; rather it would fail simply because the numbers don’t add up, regardless of which bipartisan solution might be contrived to achieve an incremental fix.

We have been living in a fantasy in which our country is so rich that it may raise spending indefinitely, that the bottommost 50 percent of taxpayers may be nearly excluded from the burden of paying for this, that the upper echelons can afford to underwrite it, and that the capital markets accept the deferral of any payment through granting the nation an unlimited credit line. The truth is that we are flat broke.

Each household or individual filing taxes would owe about $80,000 to extinguish the federal debt, and it is on the hook for a total of $520,000 including future entitlements.

The effect of shifting this burden to specific subgroups of tax payers quickly escalates the per household obligation to ludicrous heights. The picture does not look much better if we spread the pain to the bottom half as we used to decades ago. Concentrating the burden upon the very richest Americans is equally shaky.

STILL, IT WOULD BE WORTH A TRY--JUST BECAUSE IT WOULD BE NOVEL AND FDR-LIKE.

While flat or fair taxes may improve upon progressive taxes, a more fundamental question needs to be asked. Have the less than 100-year-old experiments with income taxation and centrally managed fiat currencies begun to produce a situation that might alter society by causing catastrophic economic depression?

At its last instance, the 1930s, socialism resulted as measured by income and estate taxes, which only temporarily abated under Reagan. And in fact on inflation-adjusted terms, the upper-middle class was not anywhere near as penalized in the Great Depression as it has grown to be over the decades that followed.

During the 1930s, the super rich were singled out for taxation. In contrast, in the downturn that begun in 2008 the unintended consequence might be punitive confiscation of wealth held by the upper-middle and middle classes, and the entrenchment of the super rich, who can operate partly outside the conventional income tax mechanism and wield heavy political influence through 527 groups, while the populace is restricted in the political process.

Flat income taxes cannot address the inequity of permitting a very select elite group to accumulate its wealth largely outside the grasp of ordinary income taxation, aided by inflation, leverage, and derivatives, while those who aspire to the same lifestyle are incessantly restrained in good times and held responsible for cleaning up the toxic mess that inflation, leverage, and derivatives inevitably produce.

Only a flat tax on wealth itself could fairly bridge this divide. Sadly, a century of centrally managed fiat currency and progressive taxation of income has incubated a pernicious sentiment of class warfare that has pitted the lowest half of society against the upper-middle class.

An objective stress test of the progressive tax code placed upon a population that has borrowed heavily in response to the inexorable inflation of investible assets stimulated by fiat currency shows that the casualty of this class warfare is the financial security of a generation and perhaps another to follow.

But it is faux class warfare, for its natural endpoint is the mutual impoverishment of nearly all citizens through the languishment of incentives and the ascendance of a ruling plutocracy.

BILL BONNER, DEVELOPING A SOCIAL CONSCIENCE? CALL THE PRESS! SOUND THE APOCALYPSE!

[Demeter]

10. US Economy in a Self-Made Vise By Bill Bonner

http://dailyreckoning.com/us-economy-in-a-self-made-vise/

...So many people are buying gold coins that the storage vaults are getting crowded, says a Bloomberg report.

But since we don’t trust the numbers anyway…let’s return to words.

Vise is a funny word. It looks like it should be pronounced like ‘vies’…but it is actually pronounced like ‘vice.’

Whatever. The New York Times says it has a grip on Congress.

On the one side, the pols are pressured to cut deficits. On the other, they are pushed to create jobs.

Of course, the TIMES misses the point. It makes it sound as though Congressmen were just innocent, well-meaning schmucks, trying to do their best to resolve conflicting pressures.

Not at all. They’re the ones who built the vise. On the one hand, they passed hugely expensive programs. They didn’t have the money to pay for all the boondoggles and bailouts, so they had to borrow. The deficits, in other words, are a problem they brought on themselves. The pressure to cut deficit spending is merely reality raising a boot with which to kick them in the derriere.

On the other side of the vise is the pressure to create jobs. The idea is preposterous flattery. Congress never actually created a single additional job in all its history. Jobs come from productive effort. From making things or providing services – at a profit. One person pays another to cut his lawn. Another pays a person to fix his teeth. Both the lawn mower and the dentist have jobs. The government, on the other hand, is a job destroyer. It takes away resources that might have been used to hire a dentist or buy a lawnmower. It can put people to work…but only by taking away resources, and real jobs, from the wealth-producing economy.

If it wanted to, government could force everyone to work digging holes or counting each other. It could increase salaries and report ‘full employment.’ But no one would have a real job. And we’d all go broke.

American politicians are facing up to the phony challenge in a phony way. That is, they are pretending to create jobs. The Europeans, on the other hand, say they are cutting deficits. They have to; lenders said they wouldn’t give them any more money. As Nouriel Roubini put it, in the Old World, “austerity is not optional.”

Here at The Daily Reckoning, we’re with the Germans. The euro feds are beginning to correct a mistake, albeit dishonestly. Americans are just adding on a new one.

Neither Americans nor Europeans are happy with each other’s response. US Treasury Secretary accused the Europeans of threatening the ‘recovery’ by withdrawing demand at a critical juncture. He insinuated that if there were another Great Depression, it would be the Europeans’ fault. Claude Trichet, meanwhile, head of the European Central Bank, says it’s the American who are to blame. It was they who came up with subprime mortgages and it was they who permitted Wall Street’s reckless and greedy speculations.

At this point, most responsible journalists and economists would say something such as: “both sides should put aside their differences, work together and put the economy back in order.” But you won’t get that kind of earnest drivel from us! It’s just mealy-mouthy nonsense. The Europeans should stop bailing out French and German banks (by guaranteeing the debts of Greece and the other PIGS). The Americans should stop trying to bail out everyone. Both should stop bailing and merely get out of the way so the economy can collapse if it wants to.

Dear readers may find our opinions too radical. Everyone else does. But the evidence shows that collapse is actually a good thing. Free market economies are remarkably robust. They don’t require the genius of politicians and bureaucrats in order to operate. And when they occasionally stumble and fall, it’s actually healthy for them. It’s how they shake off parasites. Bloomberg reports:

Currency collapses tend to spur a resumption of economic growth rather than fueling a decline in gross domestic product, according to the Bank for International Settlements.

Currency collapses are associated with permanent output losses of about 6 percent of GDP, on average, though the drop tends to appear beforehand, the Basel, Switzerland-based BIS said in its quarterly review yesterday.

“This suggests that it may not be the currency collapse that reduces output, but rather the factors that led to the depreciation,” Camilo E. Tovar wrote in the study. “To gain a full understanding of the implications of currency collapses on economic activity it is important to carefully examine the full circle of events surrounding the episode.”

The positive effects of a weaker currency on GDP, including making local products cheaper than imported goods, may outweigh the negative ones, such as rising inflation. Currency collapses occur when the annual exchange rate drops by about 22 percent, according to the BIS, which identified 79 such episodes, “more commonly in Africa than in Asia or Latin America,” since 1960, Tovar said.

[ozymandius]

11. Stocks, Commodities Climb as China Ends Yuan Dollar Peg

Stocks advanced for a 10th day, sending the MSCI World Index to its longest rally in 11 months, oil and copper soared and Treasuries plunged after China signaled it will relax the yuan’s fixed rate to the dollar.

Futures on the Standard & Poor’s 500 Index rose 1.6 percent and the Stoxx Europe 600 Index climbed to the highest point since May 4 at 11:07 a.m. in London. The MSCI Asia Pacific Index jumped 2.5 percent, the most in two weeks. Oil exceeded $78 a barrel, copper gained more than 3 percent and gold reached a record in New York. The Korean won strengthened as the yen and dollar fell against most major currencies, while the 10-year Treasury yield surged 8 basis points.

The People’s Bank of China said it will end a two-year currency peg adopted during the global financial crisis to protect exporters, a sign policy makers expect the world economy to strengthen. China, the world’s largest copper consumer and second-biggest user of oil after the U.S., signaled the change before the G-20 summit in Toronto on June 26 to 27.

Gains in Asia were led by the Shanghai Stock Exchange Composite Index, which surged 2.9 percent. Toyota Motor Co., the world’s biggest automaker, rose 1.7 in Tokyo while Mitsubishi Corp. jumped 6.6 percent. Posco, South Korea’s biggest steelmaker, rallied 5.9 percent in Seoul.

In Europe, all 19 industry groups in the Stoxx 600 advanced. Basic-resources shares led the rally, as BHP Billiton Ltd., the world’s biggest mining company, gained 4.1 percent and Rio Tinto Group surged 5.4 percent in London. Daimler AG led automakers higher, climbing 3.1 percent in Frankfurt. Akzo Nobel NV rallied 1.7 percent in Amsterdam after agreeing to sell its National Starch business to Corn Products International Inc.

http://www.bloomberg.com/news/2010-06-21/stocks-commodities-surge-after-china-signals-end-to-peg-dollar-weakens.html

[Demeter]

14. Are You As Surprised by This as I Was?

China has resisted this step for so long, I thought they might stay pegged forever. Something changed, and despite extensive research, I don't know what or who.

I didn't realize that the peg was only 2 years' ago. I thought it was much earlier. Maybe the last "adjustment" was two years ago?

It would be amazing if it was China's labor unrest that led to this. I'd wonder what labor unrest could accomplish here.

[ozymandius]

18. I am surprised.

But then, paradoxically, I am not. China has resisted loosening its peg to the dollar in order to keep the prices of its products low in America. These were artificially low prices. Labor unrest in China certainly has something to do with this. As labor becomes more expensive, then letting the yuan float against a basket of currencies will obscure the cost of labor. Some new price equilibrium will be established among the demand for China's products and the cost of production.

In short: it had to happen. There was no way that China could remain solely tied to the American dollar just as China cannot remain tethered to the moniker as America's manufacturer.

[ozymandius]

25. As China Aids Labor, Unrest Is Still Rising

BEIJING — On a hot morning in late May, while some 2,000 workers at a Honda parts factory were striking in China’s south, 100 irate employees at a hotel in the heart of the capital staged their own protest.
Related

The Honda workers got lots of publicity. The hotel employees were mostly ignored. But the undercurrent was the same: labor disputes are becoming a common feature of the Chinese economic landscape.

Chinese workers are much more willing these days to defend their rights and demand higher wages, encouraged by recent policies from the central government aimed at protecting laborers and closing the income gap. Chinese leaders dread even the hint of Solidarity-style labor activism. But they have moved to empower workers by pushing through labor laws that signaled that central authorities would no longer tolerate poor workplace conditions, legal scholars and Chinese labor experts say.

The laws, enacted in 2008, were intended to channel worker frustrations through a system of arbitration and courts so no broader protest movements would threaten political stability.

But if recent strikes and a surge in arbitration and court cases reflect a rising worker consciousness partly rooted in awareness of greater legal rights, they also underscore new challenges in China. The labor laws have raised expectations, but still leave workers relatively powerless by Western standards. The Communist Party-run legal system cannot cope with the exploding volume of labor disputes. And legal enforcement by local officials loosened when the global economic crisis hit China and resulted in factory shutdowns.

http://www.nytimes.com/2010/06/21/world/asia/21chinalabor.html?hp=&adxnnl=1&adxnnlx=1277121644-sBtEam5QhKXxnUYL6GeV/A

[amandabeech]

47. They've been holding steady on the peg for two years.

Of course, during that time, the U.S. economy has gone into the toilet and the Chinese economy has doing very well, at least from what info has come out.

As I write, the yuan has strengthened by about 0.5%. I'll get excited when the the yuan appreciates agains the dollar by at least 10% over the next six months. They really need to revalue by at least 20% and let the yuan float. IIRC, they agreed to let the yuan float at some point, and that was in the MFN/WTO/GATT agreements back in '99 or so. My guess is that the Chinese are not living up to their agreements and have no intention of doing so.

I'm not holding my breath. They are, after all, the Middle Kingdom and we're just a bunch of barbarians.

[ozymandius]

24. China Yuan Depeg: Much Ado About Nothing

From Ritholtz:

Global equity futures are up strongly on the weekend announcement by the People’s Bank of China regarding the depeg of the Yuan to the dollar (US Futures below).

To be blunt, the Chinese announcement is only that — an announcement which may or may not be followed through. As such, we should treat it as a precursor, and not the significant shift the market seems to be making of the announcement.

I am neither a currency nor a China expert; however, a few items have emerged:

• Protectionist legislation is being discussed in the US due to the über cheap Chinese exports; this announcement may preempt Congress from passing it.

• In theory, a rising Yuan can help reduce Sino-inflation, which has been running way above global trend;

• China might be concerned that global economies, especially in Europe and America, remain soft, and this could be of aid to the exporters in those countries.

http://www.ritholtz.com/blog/2010/06/china-yuan-depeg-much-ado-about-nothing/

[Po_d Mainiac]

28. Funny thing about de-pegging

Who's to say it's the intent of the PRC to allow the CNY to float?

The Yuan will go where they want it to. With around $1 trillion U$D to play with, they have a lot of options.

When the majority of "economist's" point in one direction, the smart money will probably be on the opposite side of that trade...If recent track records are any indication YMMV
:popcorn:

[Demeter]

12. Insured Lives Sometimes Commit Suicide By Bill Baker

http://dailyreckoning.com/insured-lives-sometimes-commit-suicide/

Moral hazard is a term with specific meaning in the financial community.

Originally the phrase was mainly used to describe a phenomenon within the insurance industry related to the uncertainty about the honesty of those insured.

Premium writers have at times noticed that a few who buy insurance lose any incentive to minimize risk, correctly thinking this has been laid off on the company writing their policy.

Insured lives sometimes commit suicide but leave no notes. Warehouses burn down more often when filled with hard-to-sell inventory. Auto owners sometimes fail to lock their cars if they are behind on their lease payments. Expensive jewelry gets misplaced when its holders come under financial pressure.

This phrase now is more often used to describe components of systemic financial system risk that have sprung up in the financial crisis that began in 2008.

The odd marriage of Wall Street and government has produced two enormous moral hazards: the securitized mortgage, as well as its cousin, the credit default swap, which together brought down the financial system in 2008.

It has begotten conflicted market structures, such as the government mortgage agencies that promote home ownership through weakening standards, but at the same time implicitly guarantee these loans.

Large brokerage firms and banks fearlessly extended credit knowing they had the Federal Reserve standing by to slash the cost of funds and repair their balance sheets.

Depositors readily handed over their savings to them, because the FDIC guaranteed against loss. Other strange beasts have evolved over time: Ratings agencies are paid handsomely by issuers, particularly for high margin, complex derivative securities.

For years many feared a conflict between commercial banking and brokerage, but this separation was irrelevant in the current crisis, as proven by the better performance of institutions in Canada and other countries.

No one objects that investment banks give away purportedly objective research that happens to compliment high-margin corporate finance activity and proprietary trading operations, a structural flaw that damages the competitiveness of those who would author reports on investments with an independent perspective.

While these financial hazards have gained attention, the largest by far gets no recognition at all.

The operation of a fiat currency encourages the accumulation of debt, which in turn pumps up the value of assets including stocks.

After generations so much can be amassed that a mega – collapse can ensue, one far greater than if gold backed the currency and also bank reserves. Gold acts as a brake on reckless expansion because the threat of conversion of paper back to gold is always a possibility.

In fact it is likely whenever pyramiding of national currencies or bank loans is uncomfortably high.

The danger of fiat currency is invisible to the public, professional investors, and political commentators, who are oblivious of its mechanism.

Thought to be a “normal” element of finance ever since we moved off direct specie systems shortly after the Constitution was ratified, its inherent flaw has remained concealed despite the meltdown of the financial system in 2008.

Since it is likely to remain unknown, it provides the ideal vector for transmitting the disease of socialism throughout the economic corpus.

The collapse of the economy permitted the majority – controlled Congress in conjunction with the new administration to authorize an unprecedented quantity of government spending, which will be funded in part by some $1 trillion of freshly minted fiat currency.

There can be no question that this is a seizure of wealth roughly equivalent to one year’s collection of income tax, yet there is more outcry over making a trivial increase in the topmost bracket from 35 percent to 39.6 percent.

The conditions for vulnerability to this virus are ideal, for the window for fiat money growth through bank loan expansion, which would normally accrue to the private sector, was closed once the public discovered it could no longer tolerate debt levels at over three times national income.

As the adage goes, when one door closes another opens; money creation can only be done now through flat-out printing, and this solely flows through a pipeline directly into the U.S. Treasury.

The historical record is such that helicopter dumps of cash through the monetization of debt enliven an economy temporarily, like the flash of burning magnesium.

So it is likely that another down-leg could follow, which would require repeated doses of the same inefficacious medicine.

The effect is to exhaust the wealth from savers and investors and dispense it to the lowest income brackets of society through entitlements such as expanded health care.

SORRY BILL, THAT ISN'T HAPPENING--AND IT IS GOING TO THE INSURANCE COMPANIES, NOT THE SICK.

Thus, in addition to spreading socialism through changing the tax code, the new administration will be able to utilize the interlocking system of fiat currency and fiscal spending to redistribute far more wealth quickly than ever was collected and redirected by the IRS.

YES, BUT IT'S GOING TO THE CORPORATIONS, THE BANKSTERS, THE "ECONOMIC ELITE".

Commentators on Wall Street greeted the first salvo of the economic recovery strategy by cheering on a massive stock market rally that began in March 2009, while talk radio focused only on the spending and taxation angle of the stimulus, completely missing the point that none of this could have been accomplished without facilitation from the Fed.

[amandabeech]

49. In olden days, this used to be called "buying the farm."

Farmers had to carry life insurance to cover the mortgage on their land.

When the farmer died, people would say, "He bought the farm."

For the benefit of the widow and the son who would inherit.

[ozymandius]

13. (meanwhile in Britain) Osborne to Tax Banks, Cut `Out of Control' U.K. Spending

U.K. Chancellor of the Exchequer George Osborne said he’ll raise taxes on banks and savers, while cutting welfare spending in a budget tomorrow that aims to close a record deficit without strangling an economic rebound.

Osborne said yesterday the “pain” of the biggest spending squeeze in 30 years will be spread over the Parliament’s five- year term and that his plans “will put beyond doubt” his resolve to fill the budget hole. Fitch Ratings said June 8 the U.K. needs to speed deficit cuts to guard its top credit rating.

His austerity plan, coming six weeks after the Conservative-led government took office, will set the size of the budget while leaving details of cuts until he maps out departmental plans in the autumn. Osborne said it remains a “good rule of thumb” that spending cuts account for 80 percent of the consolidation and that tax increases make up 20 percent.

Some economists and opposition parties say current government forecasts of 2.6 percent growth in 2011 and 2.8 percent in 2012 may be scaled back as Osborne’s measures suck resources out of the economy. During this year’s election campaign ex-Prime Minister Gordon Brown said immediate spending cuts sought by Conservatives risked a double-dip recession.

Former Bank of England policy maker David Blanchflower said the spending “look certain” to push the U.K. back into a recession.

http://www.bloomberg.com/news/2010-06-21/osborne-to-tax-banks-cut-out-of-control-u-k-spending.html

---

I wonder how the Liberal Dems plan to own this.

[ozymandius]

15. London's City Buys BP While Wall Street Flees Risk in U.S.

BP Plc, the worst oil investment this year on Wall Street, is finding its backers in the City of London.

Investors piled more money behind “buy” trades than “sell” ones in London since the April 20 rig explosion, according to so-called money flow data compiled by Bloomberg, even as the stock slumped to a 13-year low. By contrast, BP’s American depositary receipts have recorded a net $185 million outflow in New York, the data show.

As the worst oil spill in U.S. history spurs attacks from President Barack Obama and soils Florida’s beaches and the Louisiana marshlands, London investors are backing BP’s embattled chief executive officer, Tony Hayward. After a five- year string of accidents and deadly disasters at BP facilities, U.S. Representative Bart Stupak suggested last week its safety record could justify pulling the company’s operating permits in the U.S.

BP agreed last week to cancel nine months of dividend payments, saving about $7.5 billion, sell $10 billion of assets and reduce investment to raise cash to meet Obama’s demand for a $20 billion fund for victims of the spill.

The London-listed stock is down 44 percent since the explosion on the Deepwater Horizon rig that killed 11 workers and started the leak on the seabed. The shares fell to a 13-year low of 342 pence on June 15, wiping about 60 billion pounds ($89 billion) off the company’s value. BP closed at 357.45 pence on June 18. The ADR is down 45 percent this year, more than any other company in the 11-member CBOE Oil Index.

BP fell as much as 4.22 percent in London today and traded at 346.85 pence as of 9:25 a.m.

http://www.bloomberg.com/news/2010-06-20/london-s-city-buys-bp-while-wall-street-holders-flee-increasing-u-s-risk.html

[Demeter]

17. Setting Up a Dead Cat Bounce?

BP is going to be gutted, the way things are going.

[Demeter]

16. 26 of 27 Nations “Pose a Threat” to Wider EU Economy By Rocky Vega

http://dailyreckoning.com/26-of-27-nations-pose-a-threat-to-wider-eu-economy/

The latest news out of the European Commission is that Cyprus, Denmark, and Finland have been added to a watch list of nations with “government deficits deemed high enough to pose a threat to the wider European economy.” It actually brings the tally up to 26 out of 27 EU countries that pose that threat. That’s right, almost every single one.

According to Bloomberg:

“The watch list now includes 26 of the 27 member countries, leaving only Luxembourg as being within the EU limit of a 3 percent budget deficit. Luxembourg finished 2009 at 2 percent. Cyprus recorded a deficit of 6.1 percent of GDP last year. Deficits are expected to reach 5.4 percent this year in Denmark and 4.1 percent in Finland. All three countries have been given deadlines to correct the situation.

“The EC, however, also announced that 12 countries have taken effective action to fight their excessive budget deficits, by cutting government spending and introducing revenue-boosting measures as promised. Among them are Ireland, Italy, Portugal, and Spain.

“With the EC trying to keep its financial house from crumbling, Moody’s announcement on Monday that it had downgraded Greece’s credit rating to junk status was criticized as “surprising” and “unfortunate” by EU Commissioner Olli Rehn.”

The article even goes on to note that Greece is the first nation to lost its investment rating in the history of the eurozone. It’s a rough time to be a member of the European economy.

You can read more details at The Epoch Times coverage of how almost all of the EU nations are on the debt crisis ‘watch list':

http://www.theepochtimes.com/n2/content/view/37542/

[ozymandius]

26. Eurobank “Stress Test” Disclosure Likely to Increase Jitters

As we noted last week, Spain has forced the hand of other Eurozone bank regulators by declaring it will release the results of recent ECB stress tests, which earlier were to be published only on an aggregated basis, not bank by bank.

There is still a good bit of confusion as to what happens next. The flurry of announcements by other eurozone leaders is that they will also release the results of stress tests, but it is clear that these will be new stress tests, not the ones already completed (note this story by Reuters, for instance, which refers to past as well as prospective stress test results).

We said we did not expect this movie to end well, even though the euro rallied impressively on the news. First, the data was to be released only on an aggregated basis before precisely because French and German authorities had not liked the idea of showing bank by bank results. Not only are French and German banks rather heavily exposed to Club Med sovereign debt, but they are likely to have dodgy exposures from the 2007-2008 crisis that are still marked very generously (even though the US is the land of “extend and pretend”, the eurozone banks have marked down less of their dodgy debt than their US peers).

Those concerns are already being reflected in the marketplace.

So let us consider the obstacles to the Europeans conducting “successful” (meaning convincing to the market) stress tests:

1. Lack of a mechanism to credibly inject serious amounts of capital should that be shown to be needed. Revealingly, Merkel assured the press that the banks could rely on the eurozone rescue facilities, the same ones that are already seen as inadequate to deal with looming sovereign debt problems.

2. The various banking regulators will need to agree on the scenarios. One of the reasons that the US tests charade worked was because Treasury and the Fed had worked closely together during the crisis (remember, Geithner had just come over from the New York Fed). So with the exception of possible complications coming from Shiela Bair at the FDIC, they key players were working together and even if they had private differences, always presented a unified front in public. By contrast, every step of the eurozone crisis has shown friction and conflict, with agreement being reached painfully, at the 11th hours.

http://www.nakedcapitalism.com/2010/06/eurobank-stress-test-disclosure-likely-to-increase-jitters.html

[Demeter]

19. Surrounded by Bursting Bubbles in the Land of Opportunity By Eric Fry

http://dailyreckoning.com/surrounded-by-bursting-bubbles-in-the-land-of-opportunity/

06/17/10 Laguna Beach, California – The Dow Jones Industrial Average added five points yesterday to close at 10,409 – almost exactly where it closed eleven years ago. Amidst giddy fanfare and high fives, the Dow closed above 10,000 for the very first time on March 29, 1999. One month later, amidst even giddier fanfare and high fives, the Dow closed above 11,000 for the very first time.

The economy was booming, the federal government was running a budget surplus, and Alan Greenspan was becoming an economic demigod. Whenever he wasn’t walking on water – or congratulating himself before Congress – he was pulling just the right monetary levers at just the right time to ensure the nation’s prosperity.

Over in the stock market, therefore, the sky was the limit.

Unfortunately, as the new millennium advanced, the tech stock bubble burst, the housing bubble burst, federal finances deteriorated from hundred-billion dollar surpluses to $1 trillion deficits, and Alan Greenspan’s omnipotence dissolved like the low-budget hologram it had always been.

With the benefit of hindsight, it became obvious that Greenspan’s “benevolent control” over the US economy was a myth. A lie. He was the Munchausen-by-proxy Federal Reserve Chairman – continuously poisoning the economy with recklessly low interest rates, then rushing to its aid with a cocktail of rate hikes and econo-babble, hoping to counteract the ill effects of financial bubbles that he, himself, had nurtured.

Greenspan’s legacy is not the only American myth that is suffering a harsh de-mythologization. Many long-standing perceptions of America’s legendary economic prowess are – How should we say? – “Under review for possible downgrade.”

Many of the most enduring and iconic components of the “American dream” are succumbing to nightmarish realities. The “Land of Opportunity,” for example, has not produced a single net new job in more than a decade. At the end of 1999, 131,402,000 Americans were drawing paychecks. Today, 131,198,000 Americans are drawing paychecks.

Meanwhile, the pride of home ownership has become the shame of mortgage default. As home prices nationwide languish at seven-year lows, an astonishing 14% of mortgage-holders are delinquent or in foreclosure.

Mortgage Delinquencies and Foreclosures

What about the value of a college education? Surely, a four-year degree retains the caché and power to elevate aspiring capitalists from the limitations of blue collar labor to the rarefied air of white collar opportunity! Think again.

As we noted in yesterday’s edition of The Daily Reckoning, a college education is “one small part of a vast American myth.” As the US economy continues its non-recovery from the credit debacle of 2008, the dubious utility of a four-year degree is becoming painfully obvious to the nation’s recent college graduates. Unemployment rates for all college graduates – both recent and ancient – have doubled from 2% to 4% during the last year. But this statistic greatly understates the problem because it fails to include the legions of graduates who return to their parent’s houses, apply for the Peace Corps, work at Starbucks or “take a year traveling.”

According to the National Association of Colleges and Employers, more than half of all 2007 college graduates who had applied for a job had received an offer by Graduation Day. In 2008, that percentage tumbled to 26%, and to less than 20% last year. Statistics like these do not inspire confidence in a college degree, but they may have inspired a recent posting at Nakedlaw.avvo.com entitled, “8 Reasons College Tuition is the Next Bubble to Burst.”

http://nakedlaw.avvo.com/2010/06/8-reasons-college-tuition-is-the-next-bubble-to-burst/

Reason #1 is that “tuition is, and has been, increasing at triple the rate of inflation.” Accordingly, therefore, “the number of college students graduating with over $25,000 in student loan debt has tripled in the past decade alone. Today, 66% of students borrow to pay for college, taking on an average of $23,165 in debt. Twelve years ago, 58% borrowed to pay for college, taking on only $13,172 in debt.”

But this “new math” isn’t working as well as the old math. For one thing, as of 2005, a student loan is no longer dischargeable in bankruptcy. (So gone are the days of borrow, default and forget). For another thing, as of 2010, a college degree is no longer an automatic entrée into attractive employment opportunities. As a result of these challenging realities, many young Americans are disdaining the mythological virtues of a college education in favor of tangible paychecks.

“Fed Up With the Economy And White-collar Drudgery,” a recent Washington Post headline declared, “College Grads Turn to Trades.” The story that followed cited several fascinating examples of college graduates who shunned traditional post-collegiate career paths to become electricians or plumbers or whatever else puts dirt under the fingernails.

“Armed with a bachelor’s degree in theology from Notre Dame,” the Post story relates, “Adam Osielski was pondering a route well traveled: law school. He watched his friends work long hours as paralegals while studying law and weighed the all-encompassing commitment. That was five years ago. Today, Osielski, 29, is a journeyman electrician rather than a law firm associate… Osielski is among a small but apparently growing number of the college-educated who are taking up the trades… Ultimately, many earn as much or more as they would in jobs requiring a college degree. Licensed journeymen can expect to be paid $65,000 to $85,000 a year, depending on overtime.”

But even this blue-collar sliver of the American dream provides more nightmares than success stories. “Local apprentice programs, which typically last five years, are swamped with applicants nowadays,” the Post relates. “The electricians’ union program, for example, has 2,500 applications for 100 slots. And nearly 4,000 want to get one of the 300 slots at plumbers and pipe fitters school… Nationwide, 550,000 people are enrolled in registered apprenticeship programs, according to the Labor Department, and the number of students in unregistered programs might be almost as high.

“Brian Jones…studied physics on an academic scholarship to McDaniel College in Westminster, Md.,” the Post continues, “hoping to get a job as an engineer with NASA or an aviation company after he graduated in 2002. He watched friends with lower grades land jobs through family contacts, but he couldn’t find one. Then a friend suggested that he could make as much money as an electrician. He just finished his third year as an apprentice.

“Rateeluck Puvapiromquan, 30, the daughter of two schoolteachers who immigrated to Baltimore…become an electrician when the only jobs she found after graduating from St. Mary’s College in 2001 with a degree in the philosophy of religion were in coffee shops and hotels.”

These non-traditional success stories illustrate very poignantly that the Land of Opportunity is offering fewer opportunities these days. Maybe the legendary American economic engine can dust itself off and resume powering the kinds of entrepreneurial activities that generate significant employment growth and national wealth. But we aren’t holding our breath.

And neither are foreign nationals who obtain post-graduate degrees from American universities. In the recent past, Ninety-two percent of Chinese Ph.D.s in science and engineering would remain in the United States for at least five years after their studies…and 85 percent of Indians.

But according to a recent survey of more than 1,200 foreign-born Ph.D. students, the percentage of Chinese who plan to stay in the US after graduation has tumbled to just 54%, while the number of Indians who expect to remain is only 58%. What’s more, only 7% of Chinese students surveyed and 25% of Indian students believe that the American economy’s best days still lay ahead. But overwhelming majorities of both Indian and Chinese students believe their home countries’ best days still lay ahead.

These survey results do not guarantee that America’s best days are behind her, but neither do these statistics inspire much confidence that America’s best days lie ahead.

[Eric’s Note: When confronting these vignettes of modern American economic life – as we mentioned in yesterday’s edition of The Daily Reckoning – some folks merely shrug their shoulders and say themselves, “Hey, it ain’t so bad. Life is still pretty darn good here in the US of A.” Other folks, still a distinct minority, offer an opposite perspective. “It’s time to get out of Dodge,” they say.

[ozymandius]

20. CVS, Medco Fight U.S. Postal Cuts on Delayed Drug Deliveries, Higher Costs

CVS Caremark Corp. and Medco Health Solutions Inc. are opposing the U.S. Postal Service’s plan to end Saturday delivery, saying the move would delay needed medicines and may boost mail-order drug prices.

The pharmacy-benefits management companies, which shipped more than 150 million drug orders last year, have joined publishers of small newspapers to challenge the Postal Service and its plan to cut service to save about $3 billion a year.

Postmaster General John Potter, facing projected deficits of $7 billion this year and $250 billion by 2020, is seeking support from business for budget cuts including the first change in delivery schedules since six-day service began in 1863. The Postal Service lost $1.6 billion in its recent quarter as customers continued to use the Internet in place of letters, print publications and monthly bills that arrive by mail.

CVS, the largest U.S. provider of prescription drugs, shipped more than 50 million orders in 2009, most by mail. CVS, based in Woonsocket, Rhode Island, probably would turn to private-delivery companies to get drugs to customers on Saturday if mail delivery is ended, at an estimated annual cost of $50 million, according to Czarnecki.

http://www.bloomberg.com/news/2010-06-21/cvs-medco-fight-u-s-postal-cuts-on-delayed-drug-deliveries-higher-costs.html

[Demeter]

21. A Valid Concern

I always thought that mail-order pharmaceuticals was putting your life in the hands of unseen forces...but evidently small pharmacies are high overhead? Or somebody figured out a way to capture that "overhead" to add to the bottom line?

I personally drove without an odometer for 6 weeks because when it broke, the shop sent it away for repairs, and UPS went on strike for a month. No idea whether I was keeping the speed limit...how much mileage I was putting on the car, etc...

[ozymandius]

22. Wall Street reform comes down to the wire

WASHINGTON (CNNMoney.com) -- With one week down and one week to go on negotiations melding the two Wall Street reform bills, lawmakers have a lot of tough decisions ahead.

House and Senate negotiators had set a goal to finish work on reconciling the bills - aimed at preventing the next financial crisis - before President Obama heads to Canada on Friday for two major summits of world leaders.

So crunch time is on. Negotiators meet again Tuesday, which only leaves them a few days. And they have yet to consider some of the more complicated and controversial issues, such as protecting consumers who buy financial products and shining a light on complex financial contracts.

Additionally, they also have to continue working on issues they broached but didn't resolve over the past week of negotiations, such as differences in creating a panel of regulators tasked with keeping an eye on risk in the financial system.

In the week to come, lawmakers will tackle more pressing differences between the bills. These include:

Volcker Rule: Named for former Fed Chair Paul Volcker, the provision would direct regulators to create rules that would stop banks from owning hedge funds and trading for their own accounts. The House bill doesn't include the Volcker rule, but lawmakers have said they're open to the idea.

Derivatives: They'll also tackle derivatives, hammering out vast differences between the chambers on ways to ensure these complex financial contracts are more transparent. Both bills push many derivatives onto clearinghouses and exchanges that can better pinpoint the value of the securities and create firewalls between buyers and sellers.

http://money.cnn.com/2010/06/19/news/economy/Wall_Street_Reform/index.htm

[Demeter]

23. No Quick Recovery for the US Economy By Bill Bonner

http://dailyreckoning.com/no-quick-recovery-for-the-us-economy/

The big debate is between those who think the authorities are being too tight and those who think they are being too loose. Broadly, Europeans are on one side. Americans are on the other. The Europeans are tightening up. The Americans are letting rip. They’re both wrong, as far as we’re concerned.

It’s all nonsense. Just goes to prove our dictum that people come to think what they must think when they must think it. The Euro-feds can’t afford to think they can loosen up. Their lenders have already laid down the law: ‘Keep spending like the Greeks and we’ll hit you with Greek-style interest rates.’

Just a few weeks ago the Greeks were forced to pay 16% interest. At that rate, borrowing is out of the question. You’re effectively cut off. Because the more you borrow, the higher your interest rate. Soon, you run out of money.

As Nouriel Roubini put it, ‘austerity is not optional.’ Since it’s not an option, but a necessity, there’s no point in thinking anything else. You might like to spend more money, but you know you can’t get away with it.

The US doesn’t have to think about austerity. Not yet, at any rate. They’ve got the whole world ready to lend them money. ‘Here, take a drink of rice wine,’ say the Chinese. ‘Here is some champagne,’ say the Europeans. ‘And here’s a bottle of whiskey,’ say the jokers in the back of the room.

It is only a matter of time before Americans fall down.

Not so, say the Keynesians – led by Paul Krugman and Martin Wolf. They say it’s just a matter of managing the situation. Enjoy the party. You can pull yourself together later.

“The best policy is to put together measures that sustain strong growth in demand in the short run,” writes Wolf in yesterday’s Financial Times, “while constraining the huge deficits in the long run. It’s like walking and chewing gum at the same time. Why should that be so hard?”

Meanwhile, Richard Koo probably knows more about this sort of economy than anyone. He’s lived with it in Japan for the last 20 years. So, what does Koo think?

He says you can forget about a quick recovery. Japan has been hoping for a quick recovery for the last 20 years. It’s been following the Krugman-Wolf approach – stimulating demand with fiscal policy. That is, it spends more than it collects in taxes, counting on the extra government spending to light a fire under the private sector.

SUPPORTING ZOMBIE BANKS, WHICH BOTH JAPAN AND GEITHNER-PAULSON HAVE BEEN DOING, IS THE OPPOSITE OF KEYNESIAN!

But that won’t happen, says Koo. The private sector won’t start spending again until it has finished de-leveraging. Paying off debts takes a long time – especially when the government keeps bailing you out. So prepare for a long slump in the private sector economy.

So far, so good. But then Koo takes the classic Keynesian line. Like Krugman and Wolf, he believes the government should replace private spending with spending of its own.

It sounds logical enough. At least if you don’t think about it too much. An economy is the sum of spending and investing. If the private sector goes into a funk and stops spending and investing, the economy shrinks. So why shouldn’t the government step in and help out a bit?

Koo thinks so. Krugman, who won a Nobel Prize in economics, thinks so. Wolf, who heads up the worlds’ most influential financial journal, thinks so.

Well, count on us, dear reader. We don’t think so.

A real economy is much too complex for such simpleminded management. It is an organic system that delivers to people what they want (markets give them what they deserve). An economy doesn’t necessarily correspond to what academic economists think it should be…or necessarily do what they think it ought to do…or sit still long enough so they can tell what the hell it is doing.

A real economy has a mind of its own. It doesn’t care about their GDP growth rates. Whether people lose their jobs or not is not its problem. And it certainly doesn’t intend to help politicians get re-elected.

Sometimes people want to spend. Sometimes they want to save. Keynes identified this “propensity to save,” as though it were an unpardonable sin. If the people won’t spend, we’ll spend for them, he said…or words to that effect. But why shouldn’t people be allowed to save money rather than spend it?

‘Because the economy might collapse,’ says the Krugman-Wolf-Koo crowd.

‘So what?’ answers The Daily Reckoning.

[Tansy_Gold]

31. The last line -- "So what?" indeed!

We buy junk that we don't need and don't make.

We don't make the things we need.

Life really is simple, people. Greed makes it complicated.



Tansy Gold

[amandabeech]

50. Banks, particularly the Zombies, aren't trying to make money by lending.

The Zombies are loaded up with wildly over-valued assets on their books. Some of them can belly up to the Fed discount window, borrow at close to zero and then either buy Treasuries or play the derivatives casino.

Why lend to businesses that are actually in pretty good shape when there's fast easy money to be had?

Mark to fantasy cannot go on forever. Maybe we should take the Spanish medicine. Mark down real estate loans on the books by 20%. If the CDOs are losing money to defaults, mark down 30% unless and until the CDOs are sold for more or start paying back at a higher rate.

[ozymandius]

27. How are the experts doing? Time to check our local stock monitor.

ozymandius watches MSFT
mbperrin watches XOM
Po_d Mainiac watches PCL
InkAddict watches P&G

Link to quote engine:
http://finance.yahoo.com/q?s=msft

Link to original article:
http://money.cnn.com/galleries/2010/fortune/1005/gallery.retire_rich_picks.fortune/index.html

[ozymandius]

29. MSFT

6/1/10 MSFT price at $25.80

Last Trade: 26.44
Trade Time: Jun 18
Change: 0.00 (0.00%)
Prev Close: 26.44
Volume: 5,400
Avg Vol (3m): 69,575,400
Market Cap: 231.72B
P/E (ttm): 13.70
EPS (ttm): 1.93
Div & Yield: 0.52 (2.00%)

[Po_d Mainiac]

30. Scum Creek

Last Trade: 37.30
Trade Time: Jun 18
Change: 0.00 (0.00%)
Prev Close: 37.30
Open: N/A
Bid: 37.31 x 500
Ask: 38.96 x 200
1y Target Est: 42.20
Day's Range: N/A - N/A
52wk Range: 27.44 - 43.75
Volume: 500
Avg Vol (3m): 2,366,240
Market Cap: 6.08B
P/E (ttm): 36.60
EPS (ttm): 1.02
Div & Yield: 1.68 (4.50%)
Plum Creek Timber Co. Inc. (PCL)

[InkAddict]

32. Here's PG:- It began at 60.88 - Not much movement this early AM

now in real-time @ 61.49

Last Trade: 61.30
Trade Time: Jun 18
Change: 0.00 (0.00%)
Prev Close: 61.30
Open: N/A
Bid: 61.67 x 100
Ask: 61.90 x 1200
1y Target Est: 70.24
Day's Range: N/A - N/A
52wk Range: 39.37 - 64.58
Volume: 3,117
Avg Vol (3m): 13,270,200
Market Cap: 176.54B
P/E (ttm): 14.63
EPS (ttm): 4.19
Div & Yield: 1.93 (3.10%

[mbperrin]

38. XOM (slept in this morning - teacher privilege ;)

6/1/10 XOM price at $59.25

Last Trade: 63.83
Trade Time: 12:11 PM EDT
Change: 0.73 (1.16%)
Prev Close: 63.10
Volume: 10,716,000
Avg Vol (3m): 30,506,000
Market Cap: 299.88B
P/E (ttm): 14.55
EPS (ttm): 4.39
Div & Yield: 1.76 (2.80%)

[ozymandius]

33. The daily stock trading charts are broken.

This may be something relating to the new DU rules. Or it may be a change at the source sites. I am looking into it.

BTW - if you have not read the new rules then you might want to familiarize yourself with them with Skinner's thread. Pay attention to hotlinking and copyright issues. These rules will certainly change the way I do things even if the change is slight.

[TalkingDog]

35. Thanks I hadn't seen that.....ummmm I guess I'll be limiting my visits outside the SMW from now on.

I'm an iconoclast by nature. Because nothing is perfect, everything is open to question and comment. I am not prone to promoting something I think is flawed. And a mindset suggesting that I cannot advocate voting against someone because they are a certain party, is moving in a direction I am entirely uncomfortable with.


It's too bad.

[TalkingDog]

43. Exactly because of things like this:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=433x349710

[Demeter]

42. Negativity? Conflict?

How about reality vs. propaganda? What is this, a Soviet Communist branch of Pravda?

I am seriously thinking: why come to DU at all?

The only "Inappropriate" attacks upon Democrats, or anyone else for that matter, are those that are absolutely false.

"Rule enforcement"? Where would this country be if "Rule enforcement" was paramount? One of England's most troublesome client state/colonies, that's where.

It's not my ballgame, and it's not my ball. But I think that DU is trying to be much less than it can be, with those particular hangups.

[TalkingDog]

34. TD Ameritrade lowers margin requirements by 80%

On June 23rd it goes from 25K for uncovered index options and 10k for uncovered equity options to 5K.

Link goes to downloadable pdf

http://img.ipost.com/client/t/tdameritradeinst/Margin_Requirements_ChangeV8_(ca).pdf


I may be missing the nuances of this policy change, but the broad picture seems to be: The velocity of money is so slow that the trading houses are desperate for an influx of cash. In a phrase: Not Good.

If somebody wants to explain the finer points, I'm open to being educated.

[bread_and_roses]

39. No finer points here, but if today were a horse-race

I think the call about now would be, "after blazing early fractions the leaders are dropping back." I think the ones to watch, though, are those shadowy four horses running last in the field, but ever gaining.

[TalkingDog]

40. ever a fan of subtlety (as it is a weakness in my repertoire) I bow to your reference n/t

[AnneD]

41. I had a chuckle too....

good one!

And speaking of chuckles.....I saw the ad that ran (and is still running) for a hotel in Jackson Square stating that "We know how to handle a British Invasion".

I split my sides laughing and the PC folk that got their knickers in a wad over it should just.....GET OVER IT.

The British got their butts kick in NOLA and the people of NOLA need the same fighting spirit and grit to handle this mess.

I would like to recommend our theme....

The Battle of New Orleans by I believe Johnny Horton (no Youtube here) but I know the lyrics by heart.

[hamerfan]

52. Johnny Horton is exactly right!

Here:

http://www.youtube.com/watch?v=LsRK3DNoa_Q

and here:

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

[AnneD]

53. No wonder he was so familiar.......

we grew up in the same neck of the woods-probably passed each other on the highways and the dirt paths to the fishing holes.....

Thanks for posting that. I often heard folks talk about him around here but I never realized he was from these parts. I haven't thought about the Louisiana Hayride in years. We also had Panther Hall in Ft.Worth when I was really young.

[amandabeech]

51. Disgusting. n/t

[TalkingDog]

36. Noonish Numbers

10,529.24 Dow +78.60 / +0.75%

2,317.48 Nasdaq +7.68 / +0.33%

1,124.18 SP +6.67 / +0.60%

[Roland99]

44. into the red now.

[DemReadingDU]

46. MAAR

no more MAAG (Mondays are always Green)

It's MAAR (Mondays are always Red)

[Demeter]

48. They are lucky it didn't go to triple digits, IMO

but they sure keep pushing to 10,500.

[Festivito]

54. Debt: 06/17/2010 13,038,877,263,966.78 (DOWN 34,123,435,462.98) (Thu)

(Down a lot. Good day.)

(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 8,559,008,375,869.96 + 4,479,868,888,096.82
DOWN 40,132,025,764.65 + UP 6,008,590,301.67

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 $3.23 THAT'S 1B$, and $3,231.08 makes 1T$.
A family of three: Mom, Dad, Child: $9.69, ABOUT TEN BUCKS for a 1B$ 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 13 seconds we net gain another American, so at the end of the workday of the report, there should be 309,493,654 people in America.
http://www.census.gov/population/www/popclockus.html ON 04/09/2010 15:49 -> 309,034,742
Currently, each of these Americans owe $42,129.71.
A family of three owes $126,389.12. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 31 days.
The average for the last 22 reports is 2,908,242,443.19.
The average for the last 30 days would be 2,132,711,125.01.
The average for the last 31 days would be 2,063,913,991.94.
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$/day.
There were 178 reports in 260 days of FY2010 averaging 6.34B$ per report, 4.34B$/day.
Above line should be okay

PROJECTION:
There are 948 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 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)
06/17/2010 13,038,877,263,966.78 BHO (UP 2,412,000,215,053.70 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 +1,129,048,260,455.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof10 +1,585,010,057,946.44 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
05/27/2010 +015,241,764,354.27 ------------**********
05/28/2010 -000,294,414,430.12 ---
06/01/2010 +078,359,726,143.31 ------------********** Tue
06/02/2010 +000,523,171,733.61 ------------********
06/03/2010 +004,027,515,403.86 ------------*********
06/04/2010 +000,194,136,067.09 ------------********
06/07/2010 +000,055,958,918.33 ------------******* Mon
06/08/2010 -000,061,366,300.19 ----
06/09/2010 +000,374,218,915.72 ------------********
06/10/2010 -005,787,434,254.89 --
06/11/2010 -000,035,173,484.80 ----
06/14/2010 +000,237,116,126.71 ------------******** Mon
06/15/2010 +026,653,914,221.49 ------------**********
06/16/2010 +000,179,185,558.18 ------------********
06/17/2010 -040,132,025,764.65 -

79,536,293,207.92 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=4432243&mesg_id=4432306

[Festivito]

55. Debt: 06/18/2010 13,038,455,716,111.87 (DOWN 421,547,854.91) (Fri)

(Up a little. Good day.)

(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 8,559,226,843,333.86 + 4,479,228,872,778.01
UP 218,467,463.90 + DOWN 640,015,318.81

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 310-Million person America.
If every American, man, woman and child puts in $3.23 THAT'S 1B$, and $3,231.01 makes 1T$.
A family of three: Mom, Dad, Child: $9.69, ABOUT TEN BUCKS for a 1B$ 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 13 seconds we net gain another American, so at the end of the workday of the report, there should be 309,500,300 people in America.
http://www.census.gov/population/www/popclockus.html ON 04/09/2010 15:49 -> 309,034,742
Currently, each of these Americans owe $42,127.44.
A family of three owes $126,382.32. (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 2,338,654,391.36.
The average for the last 30 days would be 1,792,968,366.71.
The average for the last 31 days would be 1,735,130,677.46.
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$/day.
There were 179 reports in 261 days of FY2010 averaging 6.31B$ per report, 4.32B$/day.
Above line should be okay

PROJECTION:
There are 947 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 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)
06/18/2010 13,038,455,716,111.87 BHO (UP 2,411,578,667,198.79 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 +1,128,626,712,600.10 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
Endof10 +1,578,347,701,528.88 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
05/28/2010 -000,294,414,430.12 ---
06/01/2010 +078,359,726,143.31 ------------********** Tue
06/02/2010 +000,523,171,733.61 ------------********
06/03/2010 +004,027,515,403.86 ------------*********
06/04/2010 +000,194,136,067.09 ------------********
06/07/2010 +000,055,958,918.33 ------------******* Mon
06/08/2010 -000,061,366,300.19 ----
06/09/2010 +000,374,218,915.72 ------------********
06/10/2010 -005,787,434,254.89 --
06/11/2010 -000,035,173,484.80 ----
06/14/2010 +000,237,116,126.71 ------------******** Mon
06/15/2010 +026,653,914,221.49 ------------**********
06/16/2010 +000,179,185,558.18 ------------********
06/17/2010 -040,132,025,764.65 -
06/18/2010 +000,218,467,463.90 ------------********

64,512,996,317.55 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=4435432&mesg_id=4438491