STOCK MARKET WATCH, Monday 27 March

[ozymandius]

Monday March 27, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 1029 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 1922 DAYS
WHERE'S OSAMA BIN-LADEN? 1622 DAYS
DAYS SINCE ENRON COLLAPSE = 1583
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 3
Other Arrests of Execs = 54


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




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

AT THE CLOSING BELL ON March 24, 2006

Dow... 11,279.97 +9.68 (+0.09%)
Nasdaq... 2,312.82 +12.67 (+0.55%)
S&P 500... 1,302.95 +1.28 (+0.10%)
30-Year Bond 4.70% -0.06 (-1.26%)
10-Yr Bond... 4.68% -0.06 (-1.35%)
Gold future... 560.50 +9.70 (+1.73%)






GOLD, EURO, YEN, Dollars and Loonie


PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Tim W. Wood

THE DOW REPORT
Overview and a Look at the Transports

The good news for the market is that as a result of the January 6, 2006 bullish reconfirmation of the Secondary Trend, the market has held firm. This fits with our “First the Gain, Then the Pain” outlook for 2006, which was discussed earlier this year, and specific details of this outlook have been covered and continue to be monitored in my newsletter.

The bad news for the market continues to be the poor internals. These deteriorating conditions are a sign of things to come, a change that is somewhere over the horizon. In other words, price is what matters at the end of the day, and for now all is well on that front and these poor internals are viewed as not really mattering. In the shorter-term, that may be true. But, when these internals are setting the stage for the next act and when they begin to matter, it is likely they are going to matter a lot. In the meantime, all appears well, at least thus far. The Secondary Trend remains bullish, and my position of “First the Gain, Then the Pain," remains on track. But, as our old buddy Kennedy Gammage used to say, I would “Dance Close to the Door.”

Last week we looked at the Industrials verses the Transports and the more recent reconfirmation of the Secondary Trend. We also looked at other important non-confirmations and the poor internals on the Nasdaq. This week, I want to look at the Transports.

-cut past charts-

Bull market breakout? No, just as the reconfirmation of the Secondary Trend suggests, this is a continuation of the rally separating Phase I form Phase II of the Dow theory secular bear market that began in 2000. This advance has been unprecedented given the technical backdrop in which it has occurred. No doubt about that! But, one thing that hasn’t changed is the meaning and end result of this data. It takes buying for an advance to continue and the buying is shrinking as can be seen by this breadth indicator. Furthermore, no amount of liquidity can fix the shrinking breadth data, and this should be obvious as we all know that the liquidity pump has been in high gear, yet breadth has been contracting for over 2 years. Yes, this entire 2004 to present act of levitation is a direct result of liquidity. At some point, the lack of breadth will override the liquidity factor and that’s when the greased pig will once again be out of his cage. Until such time, this levitation act continues with another level now being added to this mammoth house of cards.

more...

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

[paul_fromatlanta]

2. What an incredibly useful post -thank you n/t

[ozymandius]

4. You're welcome Paul.

And thanks so much for saying so - from one Atlantan to another.

Ozy :hi:

[AnneD]

25. Morning Marketeers,

:donut: Loved the photo Ozy. :spray:
So is it safe to assume that what happens in Vegas stays in Vegas. I always liked the expression 'loose slots'. I am not quiet sure what qualifies as a loose slot but I always get a chuckle. The funniest thing about Vegas are the slots in the bathrooms. I'm such a stickler about germs in the bathroom and besides, why are you in the bathroom anyway. Oh, and just try to find out the time in the casinos. It is certainly another world.

Have any of you seen the massive protests reguarding the immigration policies. Damn, why couldn't we muster half of that for our anti war, anti Bush rallies. We get all excited if we have 50-100 at our ralies.

And what about all these Conservatives back pedaling at the 3 yr annivesary of the war now. Sorry but I am not buying it. I was able to figure out WITHOUT any info other than what I read in the papers and from a tad of historical research at the time that Al Quida alone (in Afghanistan) was responsible and SH was not and that the UN inspectors were doing their job. All these Senators, that had far more info at their fingertips, should have come to the same conclusion. These Senators (few DEM AND GOP)have not stood up when it counted against this Imperial Dictatorship. Saying OOPS this was a bad idea now doesn't cut it. They are still calling those of us that disagree with their decisions unpatriotic and spying on us. Frankly all these articles make me boil over. And all the conservatives columns are trashing Bush for overspending, thus he is not really a conservative:wtf:. I mean these putzes have approved every tax cut and spending measure, and now it is Bush's fault. I am not a moran, like their average reader.
OK, no more caffine for me today:rant:

Happy hunting and watch out for the bears.

[ozymandius]

3. Oil below $64 on Nigerian hostage release

LONDON (Reuters) - Oil prices fell below $64 on Monday after flirting with seven-week highs earlier in the session as Nigerian militants freed three foreign oil workers held hostage for five weeks.

U.S. light crude for May delivery slipped 65 cents at $63.61 a barrel in by 4:22 a.m. The session's high was $64.75, matching Friday's peak, the highest since February 7.

London Brent crude fell 64 cents at $62.87 a barrel.

The release of two Americans and a Briton, employees of U.S. oil service company Willbros, raised hopes for an end to three months of sabotage and kidnapping in the world's eighth largest oil exporting country that has cut shipments by a quarter.

more...

[UpInArms]

21. Vague Law and Hard Lobbying Add Up to Billions for Big Oil

http://www.nytimes.com/2006/03/27/business/27royalties.html?ei=5099&en=53f41409d18e38b4&ex=1144126800&partner=TOPIXNEWS&pagewanted=all

WASHINGTON, March 26 — It was after midnight and every lawmaker in the committee room wanted to go home, but there was still time to sweeten a deal encouraging oil and gas companies to drill in the Gulf of Mexico.

<snip>

Mr. Barton's claim had a long history. For more than a decade, lawmakers and administration officials, both Republicans and Democrats, have promised there would be no cost to taxpayers for a program allowing companies to avoid paying the government royalties on oil and gas produced in publicly owned waters in the Gulf.

But last month, the Bush administration confirmed that it expected the government to waive about $7 billion in royalties over the next five years, even though the industry incentive was expressly conceived of for times when energy prices were low. And that number could quadruple to more than $28 billion if a lawsuit filed last week challenging one of the program's remaining restrictions proves successful.

<snip>

Working closely with industry executives, he wrote legislation that would allow a company drilling in deep water to escape the standard 12 percent royalty on up to 87.5 million barrels of oil or its equivalent in natural gas. The coastal waters are mostly owned by the federal government, which leases tens of millions of acres in exchange for upfront fees and a share of sales, or royalties.

<snip>

"The provision will result in a minimum net benefit to the Treasury of $200 million by the year 2000," Mr. Johnston declared in November 1995, denouncing what he called "outrageous allegations" that the plan was a giveaway.

<snip>

Representative Robert Livingston of Louisiana, then a rising Republican leader, declared that the inducements would "create thousands of jobs" and "reduce the deficit."

...very long article...

[54anickel]

37. So some are having an "I f'd-up moment"? No, they shouldn't get off

that easily for being played a fool and tool by Big Oil. Gotta love the blame Clinton tone of the article. Was he at fault? Maybe, maybe not - sort of water under the bridge at this point. The bigger question is "what's being done to remedy the situation now?" The answer - NOTHING, instead they appear to be cashing in as quickly as possible.

What might have been a $2 billion mistake in the Clinton administration suddenly ballooned into a $5 billion headache under Mr. Bush.

But even as the Bush administration was losing in court, it was offering new incentives for the energy industry.

Mr. Bush placed a top priority on expanding oil and gas production as soon as he took office in 2001. Vice President Dick Cheney's task force on energy, warning of a deepening shortfall in domestic energy production, urged the government to "explore opportunities for royalty reduction" and to open areas like the Arctic National Wildlife Refuge to drilling.

snip>

Last April, President Bush himself expressed skepticism about giving new incentives to oil and gas drillers. "With oil at $50 a barrel," Mr. Bush remarked, "I don't think energy companies need taxpayer-funded incentives to explore."

But on Aug. 8, Mr. Bush signed a sweeping energy bill that contained $2.6 billion in new tax breaks for oil and gas drillers and a modest expansion of the 10-year-old "royalty relief" program. For the most part, the law locked in incentives that the Interior Department was already offering for another five years. But it included some embellishments, like an extra break on royalties for companies drilling in the deepest waters.

Obviously, Bush is still in the habit of counting American tax payers as fodder units. :argh:

[54anickel]

38. GACK!!! WTF - I just read the last paragraph!!! What about the contracts

with the citizens of this nation? SS, medicare, pensions, etc. etc. etc. What about laws and up-holding the Constitution for that matter? Isn't THAT a contract?

Have I mentioned lately how much I despise these cretins?

[ozymandius]

5. Gas Prices Jump Nearly 15 Cents Per Gallon

CAMARILLO, Calif. - Retail gas prices across the country climbed an average of nearly 15 cents in the past two weeks, according to a survey released Sunday.

The weighted average price for all three grades increased to $2.52 a gallon by Friday, according to Trilby Lundberg, who publishes the semimonthly Lundberg Survey of 7,000 gas stations in the country.

Gas prices are 40 cents higher than they were a year ago.

short story

[Dogmudgeon]

10. Smells Like Peak Oil

The oil price graph has looked like a jagged saw-edge since ... well, since December 13, 2000.

--p!

[54anickel]

43. "Worse than a Fool"

http://jameswolcott.com/archives/2006/03/worse_than_a_fo.php

Among the many peculiarities of this president is his utter refusal to listen to those within his own orbit in the oil realm. It's understandable, if unacceptable, that Bush would ignore the warnings of environmentalists regarding Peak Oil and global warming, but why would he tune out the words of his gummy ally Tony Blair, Matthew Simmons, the expert oil analyst and author of Twilight in the Desert who has briefed Bush personally, and Richard Rainwater?

snip>

"'This is a nonrecurring event," he says. 'The 100-year flood in Houston real estate was one, the ability to buy oil and gas really cheap was another, and now there's the opportunity to do something based on a shortage of natural resources. Can you make money? Well, yeah. One way is to just stay long domestic oil. But there may be something more important than making money. This is the first scenario I've seen where I question the survivability of mankind. I don't want the world to wake up one day and say, 'How come some doofus billionaire in Texas made all this money by being aware of this, and why didn't someone tell us?'"

The only explanation, apart from Bush's cognitive disability in facing reality, is that he sociopathically doesn't care about the coming calamity endangering the planet because he and his cronies will be financially prepared even as most Americans lose their standard of living.

There are so many reasons that Bush's name should be dragged through the dust of his post-presidency for the harm and disgrace his administration has inflicted, and so impeachable offenses for which he would prosecuted today if we had a Congress worthy of the Founders. His malign indifference to Peak Oil and global warming may be the greatest of his crimes, because it will lead to the misery and deaths of untold millions of people, animals, and natural resources.

Richard Heinberg, author of The Party's Over and Powerdown, methodically lays out the prosecution argument for the impeachment of George W. Bush.

more...


George W. Bush and Peak Oil: Beyond Incompetence
by Richard Heinberg

http://energybulletin.net/14102.html

While it would be difficult to create an airtight legal case for impeaching George W. Bush based on his ignoring the very real threat posed by Peak Oil, nevertheless I believe that his actions—and inaction—in this regard constitute dereliction of duty on an unprecedented scale.

It is part of the job of leaders to foresee problems and either steer around them or prepare for them. A head of state is analogous to the captain of a ship, who is responsible not only for keeping his vessel on course but also for avoiding hazards such as storms and icebergs. Some problems are not foreseeable; others are. A ship’s captain who loses his vessel to a freak “perfect storm” may be blameless, but one who steers his passenger liner directly into a foggy ice field, having no sonar or radar, is worse than a fool: he is criminally negligent.

The argument I will make, in brief, is this:

Peak Oil is foreseeable.
The consequences are also foreseeable and are likely to be ruinous.
The Bush administration has been repeatedly warned.
Actions could be taken to reduce the impact, but the longer those actions are delayed, the worse the impact will be.
The administration, rather than taking steps to mitigate these looming catastrophic impacts, has instead done things that can only worsen them.

Let us go through these points one by one.

[Dogmudgeon]

49. Excellent finds! Thank you!

And to think, we coulda had a president who was 20 years ahead of the curve on both energy and climate issues.

Well ... if we'd gotten him, we'd probably be hating him for being a "pink tutu" or something; alas!

You do realize, though, that nothing substantial will be done until the Investing Class is hit with the energy crisis like a two-by-four across the face.

Gas was $2.499 this morning. I got ten bucks' worth. This no longer upsets me, though my mother is routinely moved to cussing out "that bastard in Washington". No, I worry what will happen in the winter of 2007-2008, when she won't be able to afford heating gas or more than basic electricity.

--p!

[54anickel]

52. Not all of the rich are dumb or greedy enough to cut off their nose

to spite their face, but exceptions like Raintree are few and far between and seem to be a disappearing breed. So yes, you're probably correct in that "nothing substantial will be done until the Investing Class is hit with the energy crisis like a two-by-four across the face".

Once it's finally bad enough to hurt "them", I shudder to think of how the "rest of us" will be fairing.

[Roland99]

31. Gas prices are showing signs of schizophrenia lately.

[ozymandius]

6. New home sales tumble

WASHINGTON (Reuters) - Sales of new U.S. homes plunged 10.5 percent in February, the biggest drop in nearly nine years, while prices fell and the number of homes on the market hit a record high, the government said on Friday in a report signaling significant slowing in the housing market.

The pace of new single-family home sales slowed to a 1.080 million unit annual rate in February from January's downwardly revised 1.207 million unit rate, the Commerce Department said.

Economists had expected new home sales to decline to a 1.200 million unit rate in February from January's originally reported 1.233 million unit pace.

more...

[ozymandius]

7. Home sales tumble, durables signal weakness (additional info)

-cut-

A separate report suggested weakness in business spending plans, with new orders for durable goods outside the volatile transportation sector falling short of forecasts.

The reports helped send the dollar down and pushed U.S. Treasury prices higher as Wall Street bet the Federal Reserve's campaign of interest-rate hikes could be near its end. Benchmark 10-year notes rose 16/32 to yield 4.67 percent from 4.74 percent on Thursday.

-cut-

"This is what the Fed wants, they want housing to slow -- that is the place where they can most effect wealth creation and spending," said Robert MacIntosh, chief economist at Eaton Vance Management in Boston. "The Fed is that much closer to being done. I think they are done after next week."

more...

[ozymandius]

8. Ex-Enron Treasurer to Resume Testimony

HOUSTON - Enron Corp. founder Kenneth Lay told employees the company was sound in October 2001, a day after the company's treasurer says he informed Lay the once-envied energy giant was so weak that bankruptcy was "inevitable."

The former treasurer, Ben Glisan Jr., is slated to resume cross-examination Monday by Lay's legal team about that assertion and others he made to jurors last week. He is the government's last major witness in the fraud and conspiracy trial of Lay and former Enron Chief Executive Jeffrey Skilling.

Glisan, who testified for two and a half days last week, corroborated much testimony presented earlier in the trial from ex-executives — many of whom, like himself, have pleaded guilty to crimes — that Lay and Skilling repeatedly lied about Enron's financial health when the former top two leaders knew the company faced serious problems.

Lay and Skilling counter that there was no fraud at Enron, they did nothing wrong, and the company crashed into bankruptcy protection in December 2001 because of negative publicity coupled with diminished market confidence.

more...

[lakeguy]

9. ah, they are using the "it was the media's fault" excuse as well.

looks like they're fast learners!

[ozymandius]

11. early pre-open blather

08:00 am : S&P futures vs fair value: +3.0. Nasdaq futures vs fair value: +6.5. Futures trade versus fair value suggests a modestly higher open, perhaps finding solace in the absence of notable economic data ahead of tomorrow's FOMC meeting since the Fed has made it clear that they will base monetary policy on the incoming data. Another 1/4% rate hike is widely anticipated and the statement may change from the prior meeting, but it is unlikely that the Fed will provide much indication of the likely course for policy.

[ozymandius]

12. Fed chairman expected to raise short-term rates

WHEN Alan Greenspan became chairman of the Federal Reserve more than 18 years ago, his first action upon taking the black leather seat at the head of the Fed's huge oak conference table was to raise interest rates. Now it is Ben Bernanke's turn.

On Monday, Dr Bernanke will convene his first meeting of the Fed's policymakers, joining the other governors and the presidents of the Fed's regional banks in a two-day session that is all but certain to end Tuesday afternoon, US time, with another quarter-point rise in short-term interest rates, the 15th consecutive increase.

That will bring the critical rate the Fed controls to 4.75 per cent, up from 1 per cent in June 2004, when Dr Greenspan started the process of steadily increasing borrowing costs. Many analysts expect Dr Bernanke and his colleagues to raise the rate yet again in May, by another quarter of a point.

"They all really want to project a sense of continuity with Greenspan," said Tom Schlesinger, executive director of the Financial Markets Center, "and they are going to err on the side of cautiousness if that is what it takes to do this."

more...

http://www.smh.com.au/news/business/fed-chairman-expected-to-raise-shortterm-rates/2006/03/27/1143441084749.html

[ozymandius]

13. Shares seen edging higher, all eyes on Fed

Mar 27, 2006 — FRANKFURT (Reuters) - Shares on Wall Street were expected to open firmer on Monday with all eyes on the U.S. Federal Reserve's interest rate decision after a two-day monetary policy meeting, which ends on Tuesday.

-cut-

By 04.40 a.m. EST the S&P 500 <.SPX> future <SPc1> was up 0.02 percent, the Dow Jones <.DJI> future <DJc1> was up 0.01 percent and the Nasdaq <.IXIC> future <NDc1> was 0.12 percent higher.

The three leading indexes are at near five-year highs.

"The focus is above all on the U.S. central bank," Dresdner Bank said in a note, adding that that anything but a 15th consecutive 25 basis point increase in the Fed funds rate — currently at 4.50 percent — would be a giant surprise.

more...

http://abcnews.go.com/Business/wireStory?id=1771491

[UpInArms]

14. daily dollar watch

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

Last trade 90.03 Change +0.21 (+0.23%)

FOMC Not the Only Thing on the Calendar Affecting Dollar

http://www.dailyfx.com/story/dailyfx-reports/daily-fundamentals/7566-fomc-not-the-only-thing-on-the-calendar.html

After four days of persistent strength, the dollar finally gave back some of its impressive gains. Durable goods orders were suppose to be the day’s most market moving piece of data, but instead it was new home sales that sent the dollar tumbling. Perhaps it was the fact that the durable goods report was a bit confusing with the headline number reporting that orders rose 2.6 percent last month but orders excluding transportation actually fell 1.3 percent. Overall, the number was mixed and didn’t give dollar traders clear enough information to cause a major move in the market. However, new home sales did. After yesterday’s strong resales figures, the market was banking on a stronger than forecasted new home sales report. It is only natural to assume that if resales hit a two year high last month that new homes would also benefit somewhat. However, according to the Commerce department, sales of new single family homes fell a whopping 10.5 percent to the lowest level since February 2003. This is extremely concerning since new developments have played a major role in fueling speculative activity in the housing market. Should new home sales continue to falter, not only would this mean that the housing market is finally suffering, but it also suggests that we will begin to see a ripple effect on businesses tied to housing. In particular these include construction companies, companies involved in home improvement, real estate agents and mortgage brokers. The list of industries that are directly or indirectly affected are endless. For months now, inventory has been rising in the “hot states” that have experienced some of the biggest increases in home values over the past few years. According to a report released yesterday by the Florida Association of Realtors, sales of existing family homes fell 20 percent. California, another hot market saw a 15 percent slide in sales. Despite the strong resales number released yesterday, we wondered how much longer the strength could continue given back to back rate hikes by the Federal Reserve, which increases the cost of borrowing higher. It now seems that we didn’t have to wait that long given today’s new home sales report. We have an extremely busy week ahead of us. Not only is the Federal Reserve expected to deliver another much anticipated rate hike, but consumer confidence, GDP, personal income, personal spending, factory orders and Chicago PMI are also due for release. Meanwhile the price action in the New Zealand dollar today is worth noting. The currency fell 2.4 percent against the dollar and has actually been selling off for 2.5 months now as Finance Minister Cullen gives his blessing for further weakness. The initial sell-off in the NZD a few months ago was also triggered by similar rhetoric from government officials.

...more...

The End of Cheap Money

http://www.dailyfx.com/story/strategy-pieces/trade-or-fade/7573-the-end-of-cheap.html

You could only love the price action in EUR/USD this week if you were a masochist. The week started by trapping all the euro longs who fell for the false breakout at the 1.2150 level as the pair quickly turned right back to the 1.2000 figure off the firm US PPI figures that had traders thinking Fed might move to 5.25% rates before pausing. The dollar bulls received yet another push higher when Thursday’s Existing Home Sales figures jumped an unexpected 5.2% higher leading everyone to conclude that the US consumer demand remained robust. But as we noted on Friday, “Existing Home Sales are a notorious lagging indicator with yesterday’s numbers really representing January’s transactions when unseasonably warm temperatures may have skewed the results. Today New Home Sales report, though far smaller in volume, may be a more accurate indicator of current housing demand. “ Sure enough New Home Sales plunged 10.5% and now it was the dollar longs turn to scramble as the pair bulldozed its way back to 1.2045 by end of Friday’s trade taking out all those freshly minted stops along the way. In short the data last week reflected the basic fact that housing prices cannot rise exponentially in an environment of higher real interest rates. The Calculated Risk blog posted a very interesting chart that showed a decline in Home Sales preceding every one of post WWII US recessions by approximately 6 months. For long term dollar bulls this is something to ponder.

...more...

[ozymandius]

16. the two economies (preach to the choir time)

There's the Wall Street economy: where speculation over the whole and partial cadavers of former industrial powerhouses leads to a runup in stock prices. Thene there's the main street economy: where low wage jobs are abundant because there is very little left.

Housing has been the band-aid for a gushing economic wound that has lasted for years. It really forces me to question if the recession (officially explained away by the Bush administration's number crunchers) has ever ended.

[AnneD]

42. Ozy....

was there ever ANY doubt. The 'Bush recovery' from has come via the middle class extracting equity from an overheated housing market. The media that covers the market consists of folks that are basically ignorant in economic fundamentals. They have been accepting data and not questioned the facts, situations, or effects of some of these companies practices. They are nothing more than advertisers reporting on what wares business wants to hawk.

Economies are basically people trading money, goods, and services for other countries money, goods, and services. So what does America offer? A few farm products, a few manufactured goods, a few financial services. Our biggest trade goods seems to be something akin to the family silver or oil interests (ports, commercial property, real estate, securities-the cash generating assest). Basically I think we are acting like a dowager that is hocking the family heirlooms to stay afloat while the kids are racking up the credit card debt.

[54anickel]

19. Ewww....

a decline in Home Sales preceding every one of post WWII US recessions by approximately 6 months.

So this invisible, denied, yet I can feel it in my pocket, non-existent recession we've been stuck in is probably going to get even WORSE by mid-year?

[54anickel]

33. Cripes, lookie at gold! A clean $6 break above $560. WTF is going on?

And, where the hell is my blue light special? B-)

[54anickel]

45. China's gold reserves double in value

http://business.timesonline.co.uk/article/0,,13132-2102426,00.html

CHINA has put Gordon Brown’s investment philosophy to shame by enjoying a near-doubling of the value of its gold reserves.

The People’s Republic has gold reserves worth $10.8 billion (£6.2 billion), based on yesterday’s $558.60 gold fix in London, compared with about $6.6 billion at the end of 2002, when China last increased its stake.

The Chinese central bank holds 600 tonnes of gold, according to new figures from the World Gold Council, the gold industry’s marketing arm.

China almost doubled its gold reserves to the 600 tonne level between 2000 and 2002, at a time when the Chancellor was a bullion seller.

snip>

America, the world’s biggest economy, also heads the list of nations placing their faith in the precious metal. America’s gold reserves are 8,135 tonnes, worth $146 billion and accounting for 73.2 per cent of America’s total foreign reserves. The central banks of Germany and Italy are similarly fond of gold as a prudent investment, and alongside France, which has reduced its gold holding, hold more than half their total foreign reserves in gold.

more...

[UpInArms]

59. Gold closes @ $567.40 oz - Silver @ $10.895 oz - Copper @ $2.475 lb

1:45 PM ET 3/27/06 COPPER CLOSES UP 6.35C AT $2.475 A POUND

1:46 PM ET 3/27/06 SILVER CLOSES UP 16C AT $10.895 AN OUNCE

1:41 PM ET 3/27/06 GOLD CLOSES UP $6.90 AT $567.40 AN OUNCE

[54anickel]

39. Today's Pfennig - Waiting for the Fed...

http://www.kitcocasey.com/displayArticle.php?id=624

snip>

"Durable goods orders rebounded by 2.6% in February after January's 8.9% plunge. The details of the report were weaker... When you take out transportation, orders fell 1.3% compared to estimates for a 1.1% gain. Orders for nondefense capital goods excluding aircraft, which correlate well with machinery and equipment investment, fell 2.3%, which falls right in line with my view that corporate / business spending will come to a snails' pace as we head to the second half of this year.

New Home Sales... Talk about an offset to the Existing Home Sales data! What? Is everyone buying nothing but old homes now? With the Median price of Existing Homes falling, I can see that! As Bill Bonner calls them... "The McMansions" could be too steep in price now... I wonder what this housing sector will bring us next?"

In addition to the FOMC rate decision, Tuesday will also bring us the Consumer Confidence numbers. On Thursday we get the 4th quarter GDP, which is expected to be slightly higher than the 3rd-quarter figure, and personal consumption along with the weekly employment figures. Friday will end the week with the release of personal income and spending, U of Mich Confidence, and the Chicago Purchasing number.

The focus today will continue to be on the FOMC meeting. While a .25% rate hike is 'in the bag', the markets will be looking to see what the new Fed Chairman Ben Bernanke has to say regarding future interest rate moves. An end to increases by the FOMC would stop a widening of the rate premium over both Europe and Japan, which helped push the dollar 10 percent higher vs. these currencies last year. As Chuck pointed out above, the cooling housing market will definitely make it more difficult for the Fed to continue to raise rates. Without this interest rate differential to fall back on, the currency markets will refocus on underlying fundamentals that are negative for the US$.

more...

[54anickel]

69. Market Insight: Overheating Iceland unnerves emerging market

http://news.ft.com/cms/s/85880a3e-bdab-11da-a998-0000779e2340.html

The attention of many traders around the world will focus this week on an island in the most northern part of the Atlantic with a population of just 300,000.


Iceland’s central bank is preparing to make what some analysts expect to be as much as 50 basis points rate increase in its benchmark interest rate on Thursday. The implications are likely to be felt beyond its remote shores.

Iceland once used to evoke mainly visions of the exotic Blue Lagoon geothermal spa or its famous volcanoes. Then it became it synonymous for its aggressive entreprenuers, particularly in the UK where they have made a series of high-profile acquisitions. But in recent weeks though, Iceland has evoked more worrying images of an overheated economy and high external debt. The concerns have spilled over into other countries as far afield as Hungary and New Zealand.

The latest alarming headline came late last week when US investors refused to roll over some loans to the country’s three biggest banks, sending the Icelandic krona to nearly a two-year low against the dollar.

more...

[UpInArms]

15. U.S. Treasury prices slip in FOMC countdown (curve still inverted)

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-27T064734Z_01_T186545_RTRIDST_0_MARKETS-TREASURIES-ASIA.XML

TOKYO, March 27 (Reuters) - U.S. Treasury prices slipped in Asia on Monday ahead of the start of a two-day Federal Reserve policy meeting at which the U.S. central bank's 15th straight rate rise was believed to be a done deal.

The market is braced for a 25 basis point rise in the federal funds rate to 4.75 percent, and investors were preparing to comb through the Fed's post-meeting statement on Tuesday for confirmation of another increase in May and possibly beyond.

"The market is getting a little nervous before the meeting, which is showing particularly in the shorter end of the yield curve," said a dealer at a Japanese trust bank.

The benchmark 10-year note <US10YT=RR> was at 4.68 percent, inching up from 4.67 percent in New York, after debt prices rose late last week on data showing a 10.5 percent plunge in new home sales in February, the biggest drop in nearly nine years.

<snip>

This kept the spread between two- and 10-year debt in negative territory, where it has hovered for a good part of the year as shorter maturities come under particular selling pressure on expectations that the Fed will keep tightening monetary policy.

...more...

[UpInArms]

26. Printing Press Report: Fed adds temporary reserves via overnight repos

Hmmmm.... they are still releasing these reports?

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-27T144116Z_01_N27344088_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, March 27 (Reuters) - The Federal Reserve said on Monday that it added temporary reserves to the banking system via overnight repurchase agreements.

The benchmark federal funds rate last traded at 4.75 percent, above the Fed's target of 4.50 percent for the overnight lending rate on loans between banks.

The Fed is widely expected to lift its fed funds target by a quarter percentage point to 4.75 percent after its two-day policy meeting concludes on Tuesday.

Further details of the operations are available at: http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[UpInArms]

48. US Treasury-can't say when currency report coming

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-27T172814Z_01_N27293229_RTRIDST_0_ECONOMY-TREASURY-CHINA-UPDATE-1.XML

WASHINGTON, March 27 (Reuters) - A U.S. Treasury spokesman declined to say on Monday whether an intently awaited report on currency practices of key trade partners will be issued before a scheduled April 20 visit by Chinese President Hu Jintao.

Interest in Hu's White House visit is high because Washington wants the Asian trade giant to take currency measures that might ease swelling U.S. trade deficits with China. Treasury is to release a report on practices by the United States' key partners, including China, and many analysts think Treasury is close to naming China a currency manipulator.

The legally required report to Congress normally is supposed to be issued by mid-April but is frequently delayed.

"I can't put a timetable on when exactly we'll get it done," Treasury spokesman Tony Fratto told reporters at a weekly briefing. "Certainly President Hu's visit will have some influence on the report but I'm not going to predict that it would come before or after, although we're certainly interested in his visit."

...more...

[UpInArms]

54. Treasurys remain lower after auction - weak demand

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B76EC40E1%2D3179%2D4A01%2D9C8D%2D66397A291C84%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) - Treasury prices remained lower Monday afternoon, sending yields higher, after an afternoon auction of 2-year notes got a rather tepid response due to investor wariness ahead of the Federal Reserve's Tuesday rate decision.

The 2-year note was down 2/32 at 99-25/32, yielding 4.748% after the notes sale.

<snip>

A Treasury auction of $22 billion in 2-year notes Monday afternoon produced a somewhat weak bid to cover - or bids accepted to bids received - ratio of 2.12.

However, the percentage of indirect bidders, a closely watched category that includes foreign central banks, was a fairly strong 35.8%. The auction produced a high yield of 4.730%

Participation levels were on the weak side because some investors want to see what, if any, clues the Fed sends Tuesday on future rate hikes.

...more...

[UpInArms]

17. Retraining Laid-Off Workers, but for What?

http://www.nytimes.com/2006/03/26/business/yourmoney/26lou.html?_r=3&oref=slogin&pagewanted=print&oref=slogin

Layoffs have disrupted the lives of millions of Americans over the last 25 years. The cure that these displaced workers are offered — retraining and more education — is heralded as a sure path to new and better-paying careers. But often that policy prescription does not work, as this book excerpt explains. It is adapted from "The Disposable American: Layoffs and Their Consequences" by Louis Uchitelle, an economics writer for The New York Times. Knopf will publish the book on Tuesday.

<snip>

The presumption — promoted by economists, educators, business executives and nearly all of the nation's political leaders, Democrats and Republicans alike — holds that in America's vibrant and flexible economy there is work, at good pay, for the educated and skilled. The unemployed need only to get themselves educated and skilled and the work will materialize. Education and training create the jobs, according to this way of thinking. Or, put another way, an appropriate job at decent pay materializes for every trained or educated worker.

<snip>

You cannot be an engineer or an accountant without a degree; in that sense, education and training certainly do count. Furthermore, in the competition for the jobs that exist, the educated and trained have an edge. That advantage shows up regularly in wage comparisons. But you cannot earn an engineer's or an accountant's typical pay if companies are not hiring engineers and accountants, or are hiring relatively few and can control the wage, chipping away at it.

<snip>

Saying that the country should solve the skills shortage through education and training became part of nearly every politician's stump speech, an innocuous way to address the politics of unemployment without strengthening either the bargaining leverage of workers or the federal government's role in bolstering labor markets.

<snip>

The Labor Department's Bureau of Labor Statistics offers a rough estimate of the imbalance in the demand for jobs as opposed to the supply. Each month since December 2000, it has surveyed the number of job vacancies across the country and compared it with the number of unemployed job seekers. On average, there were 2.6 job seekers for every job opening over the first 41 months of the survey. That ratio would have been even higher, according to the bureau, if the calculation had included the millions of people who stopped looking for work because they did not believe that they could get decent jobs.

So the demand for jobs is considerably greater than the supply, and the supply is not what the reigning theory says it is. Most of the unfilled jobs pay low wages and require relatively little skill, often less than the jobholder has. From the spring of 2003 to the spring of 2004, for example, more than 55 percent of the hiring was at wages of $13.25 an hour or less: hotel and restaurant workers, health care employees, temporary replacements and the like.

<snip>

The $13.25 threshold is important. More than 45 percent of the nation's workers, whatever their skills, earned less than $13.25 an hour in 2004, or $27,600 a year for a full-time worker. That is roughly the income that a family of four must have in many parts of the country to maintain a standard of living minimally above the poverty level. Surely lack of skill and education does not hold down the wages of nearly half the work force.

...more...

[54anickel]

23. Excellent article UIA. I saw your post of it this weekend in LBN before

it got bumped to the Editorial section. Glad to see you reposted it here. It is quite a pickle labor has found itself in - the race to the bottom. It's not just union vs non-union anymore. It's turned into a form of American workers competitively bidding for jobs. Who's working to work for the least amount of pay, benefits, and worker safety. Will the pride of workmanship, efficiency, detail and quality be the same? Probably not. Will anyone care? Not until these suckers start falling out of the sky. And who will get the blame should that happen? The workers once again.

Life is just one big shit sandwich and every day's another bite.

Sorry to be so glum today, I need to work on being one of those happy-happy optimistic people....Guess that means I should stop reading the news and start relying on Faux et al for my daily information requirements.

[UpInArms]

24. the lack of optimism is definitely hitting home here

my hubby has sunk into the doldrums - said he hated being only informed of "bad news" - I suggested we begin watching FAUX and turning of the computer, but he nixed that, too.

Not being informed is worse than anything - but the future just doesn't look too bright and that six month forecast had me shaking in my pjs last night when I read it.

Hated to post it this a.m., but once again, forewarned is forearmed.

:hi:

[54anickel]

35. Well, they do say ignorance is bliss. Not sure that's the price I want

to pay for happiness though.

[KoKo]

36. Confirmed, finally what some of us here have known...

All that happy talk of "retraining" when we who had been through all of this for the last decades could see it for what it was.

I can't understand how Bush is still there...or Congress hasn't been thrown out. But, then I think they are good at making folks feel it's only "they" who were unfortunate enough to layed off and that the rest of America is happily building their McMansions driving their happy kids in SUV's to soccer practice and dancing lessons.

What's wrong with you if you were layed off, downsized or outsourced. You just were in the "wrong place at the wrong time." So sad... Just go to "happy camp" get retrained and you too can live in those McMansions and park your Hummer next to your Mercedes. Buy the kid a Lexus and send them off to Harvard where they can join a Think Tank or become a lobbyist and make bag full. Or, maybe they will make it to CEO or become a Hedge Fund Operator or Day Trader. Lottsa quick money to be made there. :-(

I'm so angry that I made oodles of typo's had to correct. I guess I need to go for "re-training." :eyes:

[54anickel]

41. Good morning KoKo. I posted something last week that talked about

the future auto-industry workers. They are expected to be more educated, while paid less. The move to break the labor movement in this country started by Reagan is certainly paying off for the Corporatists. Now, if they can just find new buyers for their stuff - since few Americans will be able to afford to sustain this consumer driven economy we've created.

Gotta wonder what the future America is going to look like...

[AnneD]

44. I was very lucky when I was laid off

(and I am the first to admit it was luck). I went back to school and became a Nurse. But even there my timing was lucky. Many of the Nurses that graduated after me (for 3-4 yrs) could not find job due to hospital consolidations and restructuring of the health care models, and went into other fields-never again to return.

Get trained and incure debt so that you can compete against Rajiv in India who will work for 1/4 th of the salary you need to survive here. I would love to get good stats on those workers who want to work but have given up. That would be a meaty study.

[UpInArms]

18. Warner Bros. aims to open 200 stores in China

http://news.yahoo.com/s/nm/20060326/bs_nm/retail_china_warner_dc

SHANGHAI (Reuters) - Time Warner Inc.'s (NYSE:TWX - news) studio division Warner Bros. plans to open some 200 stores in China over the coming years as demand for branded merchandise increases in China, the Chinese partner of the firm's consumer products unit said on Sunday.

Warner Bros. opened its first China store in Shanghai on Sunday, which is operated by a subsidiary of ports-to-telecoms conglomerate Hutchison Whampoa Ltd.'s (0013.HK) toy production unit Hutchison Harbour Ring.

"In the long run, we would like to open no less than 200 stores. During the next few years, we would like to make 200 as a target," Michelle Chan, Hutchison Harbour Ring's managing director, told a press briefing.

The companies plan to open the stores in mainland China, Hong Kong and Macau, starting off in Shanghai's commercial centers and moving on to other cities such as Beijing, and southern China's Guangzhou and Shenzhen, Chan said.

China's growing population of consumers with excess cash to spend has attracted the likes of Warner Bros. and Walt Disney Co. (NYSE: DIS - news) to China, as they look to cash in on the growing popularity of their trademark characters like Mickey Mouse and Bugs Bunny.

...more...

[UpInArms]

20. "China and India really represent the future of Wal-Mart"

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=businessNews&storyID=uri:2006-03-27T092703Z_01_SP5974_RTRUKOC_0_US-RETAIL-INDIA-WALMART.xml

SHENZHEN, China (Reuters) - When Wal-Mart Stores Inc. opened its first store in Shenzhen a decade ago, the local newspaper headline proclaimed, "The Wolf is Coming."

The world's biggest retailer has not exactly devoured China's retail sector since then, opening just 56 stores, but it has learned a few lessons that may prove useful for its next major project -- India.

"China and India really represent the future of Wal-Mart," Joe Hatfield, chief executive officer for Wal-Mart Asia, told Reuters in Shenzhen, the retailer's China headquarters. Foreign retailers are not permitted to directly invest in India's retail sector, but they have been lobbying hard for a change to those rules.

Analysts say that will likely happen within a year or two.

<snip>

His best advice? "Steal shamelessly," Hatfield said, quoting from Wal-Mart founder Sam Walton, who routinely visited competitors' stores to get new ideas.

...more...

[54anickel]

57. The Wal-Martization of China Is Bullish For Commodities

http://www.321gold.com/editorials/balarie/balarie032706.html

Wal-Mart was the "big" story this week. A good number of media outlets reported that Wal-Mart was looking at adding a luxury component to there US stores. Pretty soon, shoppers will now be able to eat sushi and buy $500 dollar wine as they shop for their typical household goods.

It is ironic, however, that a much bigger Wal-Mart story did not garner as much media attention. In a sense, it shows the US centric focus on the economy. Nonetheless, the recent news that Wal-Mart is looking at adding 150,000 employees in China over the next 5 years does hold some significance. First, it reaffirms the fact that the Chinese consumer economy is both growing and still in its early stages. Twenty years ago, your average Chinese citizen made just enough money to cover their basic household expenses. Today, they are looking at purchasing cell phones, computers, and televisions. Tomorrow, they will trade in their bicycles for cars.

Second, this expected demand for consumer goods will lead to a continued demand for commodities. Although most people have focused on the industrialization aspect of this commodity bull market, the demand for commodities due to increased demand in consumer products will also contribute to higher commodity prices. There are 1.3 billion consumers in China and another 1.1 billion consumers in India. Most of these consumers do not have the basic household goods that are associated with western economies. The main reason for this is that they cannot afford it. However, as China and India continue to industrialize, a wealthier and educated working class will be created. In turn, this working class will now have the disposable income to purchase goods that you can find at your local Wal-Mart

Unemployment numbers also came out this week. The department of Labor reported that 302,000 workers applied for jobless claims last week. This was a decline of 11,000 from the previous week. According to the labor department, jobs were created in construction, retail, financial services, and healthcare sectors. As a result, most pundits point out to the strengthening job market as signs of a strong economy. What some fail to point out, however, is the manufacturing sector continued to lose jobs.

more...

[UpInArms]

22. pre-opening blather

09:15 am : S&P futures vs fair value: +2.0. Nasdaq futures vs fair value: +3.5.

09:00 am : S&P futures vs fair value: +1.8. Nasdaq futures vs fair value: +3.5. Futures indications still reflect continued optimism that the Fed will alter their policy view tomorrow despite the evidence (i.e. Fed's focus on "resource utilization" implying a continued need to raise rates) suggesting otherwise. While such a change could validate the wishful thinking that has helped the S&P 500 stay on pace for its biggest first-quarter gain in seven years, it is also true that the market may be set up for a disappointment.

08:31 am : S&P futures vs fair value: +2.7. Nasdaq futures vs fair value: +5.0. Still shaping up for stocks to open on an upbeat note despite any meaningful catalysts to account for the underlying positive bias. While Mondays are typically known for M&A activity, there are none to speak of today and the only notable earnings report has come from Walgreen (WAG), not a market mover, as investors continue to hang their hopes on the Fed showing signs that the tightening is almost over.

08:00 am : S&P futures vs fair value: +3.0. Nasdaq futures vs fair value: +6.5. Futures trade versus fair value suggests a modestly higher open, perhaps finding solace in the absence of notable economic data ahead of today's two-day FOMC meeting since the Fed has made it clear that they will base monetary policy on incoming data. Another 1/4% rate hike is widely anticipated tomorrow and the statement may change from the prior meeting, but it is unlikely that the Fed will provide much indication of the likely course for policy.

[54anickel]

27. The Flow of Finance (the last entry in Credit Bubble Bulletin)

As usual, an interesting read all the way down to this article, such as this chart at the beginning:




And now, back to the subject line article...

http://www.prudentbear.com/creditbubblebulletin.asp

The Flow of Finance:

Question from Representative Mark Kennedy: “As you know, our nation’s trade deficit continues to be an issue that is a focal point of many in Congress. While various views have been put forth about how to interpret the numbers by the Commerce Department in recent years, last year you proposed an alternative view as to the likely cause of the U.S. trade deficit. Specifically, you have indicated that the trade deficit is largely dependent on the saving surplus in developing countries. In essence, a big part of the trade deficit and account deficit is because the rest of the world wants to invest in the U.S., because of our dynamic and rapidly growing economy and the returns on investment our economy is capable of generating. With our trade deficit for 2005 having just been reported, do you still see your analysis as an accurate portrayal of our country’s trade imbalance?”

Written response from Fed chairman Bernanke: “As indicated by the question, in my March 2005 speech, “The Global Savings Glut and the U.S. Current Account Deficit,” I identified the excess of notional saving over investment rates in the developing countries as a major factor underlying the large U.S. current account deficit. The speech proposed several reasons for why the current account balance of developing countries had swung into surplus, including the reaction of developing Asian economies to the financial crisis of 1997-98 and the effect of rising oil prices on the revenues and trade balances of the oil-exporting countries. Nothing has occurred since March 2005 to diminish support for the “global saving glut” hypothesis, and the factors contributing to this ‘glut’ generally remain in place. The U.S. trade deficit has widened $106 billion between 2004 and 2005, but the surplus of the developing economies is generally estimated to have widened as well. Much of the widening of the U.S. deficit and of the developing country surplus is attributable to higher oil prices – a factor identified in my March speech. Additionally, U.S. economic growth again exceeded that of a trade-weighted average of industrial economies in 2005, thus continuing to support the relative attractiveness of investments in the United States.”

I suppose it was wishful thinking on my part that Dr. Bernanke’s “global saving glut hypothesis” (propaganda) had been quietly left behind at the office of the President’s Council of Economic Advisors. Such analysis is certainly not befitting of the Chairman of the Federal Reserve.

ECB Chief Economist Otmar Issing, quoted earlier in the week in a Bloomberg interview: “A large liquidity buildup has developed and we can’t ignore it. In the last quarter, growth has moderated, but we can’t forget what’s already happened.’”

March 24 – Bloomberg (Matthew Brockett): “European Central Bank Chief Economist Otmar Issing comments…on money supply growth and asset prices: ‘You can’t ignore developments in money and credit.’ The issue of asset price increases ‘for me is one of the biggest challenges of central banks of our time: how to deal with that. We are far from final answers… One of the advantages of our strategy, which is now more and more recognized, is that there’s hardly any development in asset prices which can’t be’ connected ‘to developments in money and credit. So giving money and credit a strong role in your analysis is forcing you to take account of that…’ The ECB says it bases interest rate decisions on the two ‘pillars’ of analyzing the economy and money supply, and Issing has advocated a policy of ‘leaning against the wind’ to avoid asset price bubbles.”

Mr. Bernanke refers sanguinely to a “global savings glut,” while the astute Mr. Issing frets over a “large liquidity buildup.” ...

more...

[54anickel]

28. Economic View: Deficits that are here to stay

http://www.iht.com/articles/2006/03/24/business/wbmarket25.php#

It has happened again. Last year was the eighth in a row with a record- setting deficit in the U.S. current account, which includes the trade balance and other income from abroad.

Yet once upon a time, those big deficits turned around in a mere five years. Could that, too, happen again?

The main reason to worry about the deficits is that they represent America's growing debt to the rest of the world. If the United States is not paying for imported goods and services with products of its own, then it is passing out IOUs in the form of stocks, bonds and other securities. America can keep rolling over and issuing more of these IOUs as long as foreigners are willing to take them. But if that were to change, the United States would be in big trouble.

America has already dodged the bullet once. From 1987 to 1991, the annual current account deficit fell from a peak of almost $161 billion - equivalent to about 3 percent of the domestic economy - to less than $3 billion. This time, however, the challenge is bigger; the deficit of $805 billion for 2005 was about 6 percent of the domestic economy. And there are other factors that could make any turnaround much more difficult.

First, consider what took place in the late 1980s and early 1990s. The dollar was falling rapidly against other currencies, partly as a result of coordination by the governments of the world's five biggest economies. As the dollar fell, American investments became less attractive to foreign investors; the same returns would be worth less when converted into their home currencies.

more...

[54anickel]

29. Personal Bankruptcy Filings Up 30 Percent Last Year, Hitting a High

http://biz.yahoo.com/ap/060326/bankruptcy_surge_yourmoney.html?.v=2

WASHINGTON (AP) -- Personal bankruptcies soared 30 percent to a record high last year, surpassing 2 million for the first time, as financially strained people rushed to file before new restrictions took effect Oct. 17.

snip>

A new law, which brought the most comprehensive revision of the U.S. Bankruptcy Code in a quarter-century, made it more difficult to erase credit card and other debts in bankruptcy. Prior to its enactment, the number of bankruptcy filings had been fairly stable.

"It is ironic that, at least in the short term, a law Congress hoped would reduce bankruptcies instead caused the largest upward spike in history," said Samuel Gerdano, executive director of the American Bankruptcy Institute, an organization of bankruptcy judges, lawyers and other experts.

snip>

The report by the National Association of Consumer Bankruptcy Attorneys was based on an analysis of 61,335 people who had gone to credit counseling agencies, the required first step under the new law before filing bankruptcy. Of the 61,335, 97 percent were unable to repay any debts and 79 percent had gotten into financial trouble because of job loss, huge medical expenses or the death of a spouse, the report said.

Passage of the new bankruptcy law came after eight years of strenuous efforts by congressional backers, banks and credit card companies. Supporters said the new provisions were needed to curb abuses of the bankruptcy system. Opponents said the changes would be especially hard on low-income working people, single mothers, minorities and the elderly and would remove a safety net for those who have lost their jobs or face mounting medical bills.

more...

There's no satisfaction in saying "I told ya so"...it's sh*t like this that gets me so dang ticked off! There's no room for intelligent debate or discussion, the banks and corporate interests with their lobbyists completely drowned out the voice of reason from reaching the majority our representatives who are sooooo freaking out of touch with the "real world". Then again - that's "by design", isn't it? :grr:

[AnneD]

47. This was the crux of my morning rant.

When you try to talk to your rep, you are immediately written off if you are a member of the 'other' party. You are totally shut out from government, no matter how valid your ideas or concerns. They are there to represent ME not the PARTY:rant:
Dang, I went off again. I swear, I haven't had any chocolate or sodas. I guess I need to drink chamomile.

[54anickel]

50. There is no debate allowed, period, end of discussion. The Republican

party is no longer recognizable. It's been taken over by, dare I say it---neo-cons. There are a few "good" conservative Republicans, such as your own Ron Paul, that attempt to fight them off. Then there are the idiots such as WI Paul Ryan that act exactly as you describe. I can't stand to contact him anymore. His replies are always the canned, shame on you for even questioning the President, regurgitated neo-con talking points. Paul Craig Roberts and Charlie Reese are a couple more examples of the old "Conservative Republicans" that are trying to take back their party. They both recently put out some great articles against the neo-con take over of their party, but I'm not gonna bother posting the links - they don't seem to go over too well here. Seems Americans have a common "enemy" in the neo-cons. Too bad there such difficulty in Dems and "old Reps" joining forces to combat the lunacy for the good of the country. It would be nice to return to the old, honest ideological debates between Dems and Repubs.

[54anickel]

51. Speaking of "no debate"....

http://www.campus-watch.org/article/id/1105

Neocons Enlist Congress in Crusade Against Middle East Studies Centers
by Shirl McArthur
Washington Report on Middle East Affairs (WRMEA)
April 2004

http://www.wrmea.com/archives/April_2004/0404030.html

An important development that went unnoticed in this column was the House's Oct. 21 passage of H.R. 3077, the "International Studies in Higher Education Act of 2003," which could cause academic international studies programs to lose their federal financing unless they show more support for U.S. foreign policy (see "Education," p. 66 of this issue). The bill, which was introduced by Rep. Peter Hoekstra on Sept. 11, was passed by the House by voice vote, with no debate, under a procedure normally used for routine, non-controversial measures, such as renaming a courthouse.

snip>

Three members of the seven-member board would be appointed by the secretary of education, at least two of whom would come from national security agencies, with the other four appointed by Congress.

In other words, the advisory board would be empowered to tell the secretary of education which studies programs meet the vague and ambiguous requirements and are therefore entitled to continue receiving federal grants. Or, put another way, federal money would dry up if the international studies program didn't show enough support for U.S. foreign policy, contribute to homeland security, or show enough "diversity" of political opinions.

Although the measure applies to all of the academic international studies centers, it apparently is aimed at Middle East Studies centers. It was introduced after the House Education subcommittee held a hearing in June on "International Programs of Higher Education and Questions of Bias." At that hearing Stanley Kurtz, a fellow at the Hoover Institution and contributing editor to National Review, charged that "Title VI-funded programs in Middle Eastern studies (and other area studies) tend to purvey extreme and one-sided criticisms of American foreign policy."

Kurtz is one of the three most prominent advocates of gaining neoconservative control over Middle East Studies programs. The other two are Martin Kramer, editor of the right-wing Middle East Quarterly and also a senior associate in the Moshe Dayan Center at Tel Aviv University, and Daniel Pipes, director of the Middle East Forum and recently appointed by Bush, over senatorial and Arab-American objections, to the board of directors of the United States Institute of Peace.

more...

I think this got stalled in the Senate, but who knows. Might have gotten through in a different bill. :shrug:

http://www.govtrack.us/congress/bill.xpd?bill=h108-3077

[54anickel]

30. Police Finding It Hard to Fill Jobs

http://www.washingtonpost.com/wp-dyn/content/article/2006/03/26/AR2006032600995.html

LONG BEACH, Calif. -- Police departments around the country are contending with a shortage of officers and trying to lure new applicants with signing bonuses, eased standards, house down payments and extra vacation time.

From this seaside Southern California city to Washington's suburbs, more than 80 percent of the nation's 17,000 law enforcement agencies, big and small, have vacancies that many can't fill, police officials estimate.

snip>

Police officials and researchers say a confluence of demographic changes and social trends have precipitated the shortage. The wars in Iraq and Afghanistan have siphoned off public-service-minded people to the military. Hundreds of law enforcement officers have handed in their badges to take higher-paying positions in the booming homeland security industry.

And each year an increasingly large number of baby-boomer officers, hired in the 1970s, retires. The labor pool in the next generation is smaller, further cutting the number of prospective applicants.

The younger generation is better educated than its predecessor, so a career in policing, where the average starting salary is $32,000, is not as attractive as it was before.


snip>

"What you are really talking about is a major national shortage in a variety of sectors -- teachers, firefighters, nurses and police officers," said Williams, the Police Foundation president. "Corporate America can move across the world to find people to work in its factories...

more...

[54anickel]

32. Bickering delays Asian currency unit launch

http://news.ft.com/cms/s/fba697ae-bcfb-11da-bdf6-0000779e2340.html

Plans to launch an Asian Currency Unit (Acu) to help develop regional bond markets and promote monetary co-operation have been delayed by political and technical arguments over which currencies to include and how the weighting system would work, say people familiar with the project.

“There is agitation over which currencies are to be in the Acu,” said one official at the Asian Development Bank, citing disagreements among Asian governments over the incorporation of the currencies of Taiwan – the island claimed by China – and of Hong Kong, Australia and New Zealand.

Haruhiko Kuroda, the ADB’s Japanese president, strongly supports increased financial co-operation in Asia and an eventual monetary union. He had hoped to launch the Acu as early as this month but ADB officials now say the process is unlikely to be completed until after the bank’s annual meeting in May.

Giovanni Capannelli, senior economist in the ADB’s Office of Regional Economic Integration, said the name might even be changed to the softer “Asian Currency Index” to avoid giving the impression that the proposed unit was the equivalent of the European Currency Unit that foreshadowed the euro.

more...

[54anickel]

34. 10:38 NAS is in the lead?

Dow 11,257.16 -22.81 (-0.20%)
Nasdaq 2,316.57 +3.75 (+0.16%)
S&P 500 1,301.43 -1.52 (-0.12%)
10-yr Bond 4.693% +0.02
30-yr Bond 4.716% +0.02
NYSE Volume 505,588,000
Nasdaq Volume 527,650,000

10:30 am : Market still trades in subdued tone as participants stay close to the sidelines ahead of the FOMC decision tomorrow and find few catalysts to move the indices more aggressively in either direction. The lack of conviction is further evidenced by a lack of industry leadership and the fact that Materials, the least of influential of the economic sectors, now leads the list of only three sectors posting gains. DJ30 -17.24 NASDAQ +2.52 SP500 -1.44 NASDAQ Dec/Adv/Vol 1530/1186/478 mln NYSE Dec/Adv/Vol 1753/1145/306 mln

10:00 am : Major averages still trade in split fashion as industry leadership remains mixed. Health Care, amid analyst downgrades on some medical equipment stocks (e.g. ZMH, SYK) and weakness in the drug group, is turning in the morning's worst performance. Energy is also consolidating on the heels of a pullback in crude futures while Financial has taken a bearish cue from a rise in borrowing costs, as the cautious tone in Treasuries has inched the yield on the 10-yr note back toward 4.70%. Technology, though, has shown decent follow-through buying led by an analyst upgrade on Intel (INTC 19.89 +0.29), a suggested holding in our Active Portfolio. DJ30 -9.04 NASDAQ +5.19 SOX +0.4% SP500 -0.49 XOI -0.1% NASDAQ Dec/Adv/Vol 1234/1275/286 mln NYSE Dec/Adv/Vol 1591/1120/180 mln

[TrogL]

40. Loonie Watch

Highlights

Current:



30-day and 90-day:



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

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

Up-to-the-minute graph: http://quotes.ino.com/chart/?s=CME_CD.H06&v=s

Current TSE



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

2006-02-27 Monday, February 27 0.87581 USD
2006-02-28 Tuesday, February 28 0.878812 USD
2006-03-01 Wednesday, March 1 0.879894 USD
2006-03-02 Thursday, March 2 0.883392 USD
2006-03-03 Friday, March 3 0.880902 USD
2006-03-06 Monday, March 6 0.877116 USD
2006-03-07 Tuesday, March 7 0.871992 USD
2006-03-08 Wednesday, March 8 0.863931 USD
2006-03-09 Thursday, March 9 0.862589 USD
2006-03-10 Friday, March 10 0.861698 USD
2006-03-13 Monday, March 13 0.860882 USD
2006-03-14 Tuesday, March 14 0.865951 USD
2006-03-15 Wednesday, March 15 0.865576 USD
2006-03-16 Thursday, March 16 0.866551 USD
2006-03-17 Friday, March 17 0.863036 USD
2006-03-20 Monday, March 20 0.860067 USD
2006-03-21 Tuesday, March 21 0.85859 USD
2006-03-22 Wednesday, March 22 0.858295 USD
2006-03-23 Thursday, March 23 0.857854 USD
2006-03-24 Friday, March 24 0.856531 USD


Current values

Last trade 0.8580 Change
Settle Time 15:04 Open 0.8552
Previous Close 0.8577 High 0.8581
Low 0.8550 Open Int. 80111


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

The June Canadian Dollar was lower overnight as it extends last week’s breakout below the November-January uptrend line and is trading below the 62% retracement level of the November-March rally crossing at .8591. Stochastics and the RSI remain bearish signaling that additional short-term weakness is possible. If June extends this month’s decline, the 75% retracement level of the November-March rally crossing near .8529 is the next downside target. Closes above the reaction high crossing at .8710 would confirm that a short-term low has been posted. Overnight action sets the stage for a lower opening in early-day session trading.



Analysis

I dunno what's going on. Alberta's budget contains provisions for a 4 billion dollar surplus. Business is booming all over. The price of oil is idiotically high and Canada is an oil-producing country.

Well, there is a Conservative government in place run by Harper, who probably couldn't find his ass with both hands.

[UpInArms]

46. 12:24 EST numbers and blather

Dow 11,234.11 -45.86 (-0.41%)
Nasdaq 2,312.38 -0.44 (-0.02%)
S&P 500 1,299.56 -3.39 (-0.26%)
10-Yr Bond 4.703 +0.28 (+0.60%)

NYSE Volume 944,935,000
Nasdaq Volume 954,165,000

12:00 pm : The market still trades with a sense of caution midday as a lack of market-moving news prompts investors to take a bearish cue from Treasuries and weigh whether or not the Fed will alter their view on monetary policy. Fed funds futures have fully priced in the odds of another 1/4% interest rate hike to 4.75% tomorrow (2:15 ET) after the FOMC concludes its first meeting not chaired by Alan Greenspan in 19 years and priced in a 76% chance of a hike at the May 10 meeting. Briefing.com chief economist Tim Rogers -- the only prognosticator to rank in the USA Today's top 10 all three years -- does not see a lot of inflation pressures and believes the Fed will raise rates just once more this year after Tuesday.

Since Fed Chairman Bernanke has given no indications of his policy leanings and economic conditions have not changed, there is more of a risk that Tuesday's policy statement will be a disappointment, concern which has removed some of the optimism that has underpinned recent market strength. After closing at the highest since May 2001 on March 17th, the S&P 500 struggles to stay on pace to capture its biggest first-quarter gain in seven years.

With regard to sector strength and weakness, seven of ten economic sectors are trading lower. Health Care remains the most influential leader to the downside following analyst downgrades on medical equipment stocks (e.g. ZMH, SYK) and consolidation in the drug group. Consumer Staples is also under pressure following an earnings miss from Walgreen (WAG 44.26 -0.11) while Financial has lost ground after Lehman downgraded bank stocks worldwide on valuation concerns and amid weakness in Treasuries. The absence of market moving economic reports -- data which the Fed has made clear will influence monetary policy -- has left bond traders focused on technical indicators and kept volume lighter than usual ahead of tomorrow's Fed decision. The yield on the 10-yr note (-08/32) currently stands at 4.70%.

The lack of conviction on the part of buyers is further evidenced by the fact that Materials -- the least influential of the economic sectors -- leads the list of only three sectors posting gains. The sector has gotten a lift following analyst upgrades on Phelps Dodge (PD 76.89 +1.75), a suggested holding in our Active Portfolio, and Alcan Aluminum (AL 45.80 +0.50), which has provided a boost to Alcoa (AA 30.53 +0.70), the Dow's best performing component. Technology has also shown relative strength led by an analyst upgrade on Intel (INTC 19.85 +0.25), another suggested holding. DJ30 -30.34 NASDAQ +1.18 SP500 -2.86 NASDAQ Dec/Adv/Vol 1666/1234/847 mln NYSE Dec/Adv/Vol 1967/1120/573 mln

11:30 am : Little changed since the last update as the major averages vacillate in roughly the same ranges. Semiconductor has recently inched back into positive territory but still struggles to keep the Nasdaq above the flat line as weakness has also been realized in software (e.g. ADBE, ADSK, INTU), biotech (e.g. AMGN, GENZ, GILD, MEDI), retail (e.g. SPLS, COST, URBN, ROST) and human resources (e.g. MNST). DJ30 -33.22 NASDAQ +0.12 SP500 -2.60 NASDAQ Dec/Adv/Vol 1685/1179/750 mln NYSE Dec/Adv/Vol 1937/1142/508 mln

[54anickel]

53. S&P Set to Launch Metro Area Home Price Indices

http://sev.prnewswire.com/banking-financial-services/20060322/NYW06622032006-1.html

NEW YORK, March 22 /PRNewswire/ -- Standard & Poor's, the world's leading index provider, announced today that it is joining with MacroMarkets and Fiserv to publish the S&P/Case-Shiller Metro Area Home Price Indices. The indices, set to launch during second quarter of 2006, are designed to be reliable, authoritative and readily available measures of residential housing prices in the United States.

Initially, ten individual metropolitan area indices and a weighted composite index of home prices will be published as part of this strategic partnership. CME, the world's largest and most diverse financial exchange, will list futures and options contracts on the indices. The ten cities include Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York Commuter Index, San Diego, San Francisco and Washington D.C. CME will also list a composite index of the ten cities for trading.

The foundation of these new, tradable indices are the Fiserv Case-Shiller(R) Indexes ("CSIs(TM)"), produced commercially by Case Shiller Weiss, Inc since 1991. Fiserv acquired Case Shiller Weiss in 2002 to form Fiserv CSW, a wholly owned subsidiary of Fiserv, Inc. The CSIs are widely recognized as the most authoritative home price indices for tracking home price trends, and are used by some of the country's largest financial institutions for mortgage analytics and real estate market surveillance.

"For the vast majority of Americans, their home is their largest and most valuable asset, and in a period of rising housing prices and increased concerns about a possible housing bubble, reliable information on their biggest asset is extremely important," says David Blitzer, Managing Director and Chairman of the Index Committee at Standard & Poor's. "Standard & Poor's is excited to be working with both MacroMarkets and Fiserv on this initiative."

This agreement will entail Standard & Poor's co-branding of tradable versions of selected real estate indices, and will facilitate rapid growth and development of the nascent investment and risk transfer opportunities in U.S. Housing. According to Federal Reserve data, the aggregate value of this asset class at the end of 2005 was $21.6 trillion - significantly larger than the total market capitalization of U.S. equities.

more...

[54anickel]

55. More Downgrades Coming

The number of companies at risk for downgrades is on the rise, says Standard & Poor's.

http://www.cfo.com/article.cfm/5674233/c_5674706?f=home_todayinfinance

Global corporate-credit quality is starting to show signs of cracking.

Standard & Poor's says in a new report that the number of companies at risk for potential credit-rating downgrades jumped to a high of 659 in mid-March, compared with 636 in mid-February.

The number represents the highest level since the rating agency began preparing the report last September. Nearly 86 percent of those at risk of downgrades are located in either the United States or Europe, with the telecommunications and automotive sectors facing the greatest likelihood of downgrades.

The rating agency reports that many of the companies vulnerable to a downgrade are in the consumer-discretionary domain — telecommunications, automotive, retail/restaurants, and health care — where pressures have been building from growing consumer debt, uncertainty about the housing market, and high energy prices.

more...


Bwahahaha, and the one good thing they can find is that debt costs are low!!! Looks like Ben's gonna have to let off the brake.

[54anickel]

56. The Coming Rebalancing of the Chinese Economy (Roach)

http://www.morganstanley.com/GEFdata/digests/20060327-mon.html#anchor0

China is sending the world an important message: A key mid-course correction in its development model is coming — a shift away from export- and investment-led growth to more of a consumer-driven dynamic. This change will not be abrupt but it will be an increasingly dominant characteristic of the Chinese growth outcome over the next five years. It is aimed, first and foremost, at providing greater stability to the Chinese economy. It will also have profound implications on the global economy and world financial markets.

I have reached this conclusion largely on the basis of very clear statements made by senior Chinese officials. It is also consistent with my own macro analysis of the Chinese economy. And it’s a conclusion that stood up well to a full-blown debate that I was part of during my recent visit to Beijing (see my 21 March dispatch, “Inside the China Debate”). The essence of the adjustment is actually very simple: A long-standing strategy of resource mobilization — powered by the recycling of a huge reservoir of domestic saving into an export- and investment-led growth dynamic — has now outlived its usefulness. Senior Chinese officials believe that the time is right to shift to more of a self-sustaining internal demand model, driven by private consumption. This rebalancing will not only enable China to deal more effectively with both internal and external imbalances, but it will also enable the reformers to turn their attention to the critically important quality dimensions of the growth experience that are now being actively debated inside of China (see Andy Xie’s 20 March 2006 dispatch, “China: Addressing Backlash Against Reform”).

China’s rebalancing imperatives are obvious. The economy has become far too reliant on two sectors — exports and fixed investment. Depending on the metric chosen — due to recent data revisions, a somewhat more ambiguous calculation than in the past — these two sectors now account for between 70% and 80% of overall Chinese GDP. And, as of this point in time, they are still expanding collectively at around a 25% annual rate. If those trends were to continue, the sustainability of the Chinese growth model would be at considerable risk. Years of rapid export growth have already led to serious trade frictions and heightened risks of protectionism. Moreover, a continuation of rapid investment growth could lead to excess capacity and deflation. Meanwhile, there is a clear and increasingly urgent need to boost private consumption, which fell to a record low of just 50.7% of Chinese GDP in 2005 — far below the 65% share that is considered the norm for a more developed economy. Similarly, the mix between capital-intensive manufacturing (47.3% of GDP in 2005) and labor-intensive services (40.3%) reflects yet another layer of distortions in China’s economy that biases its growth dynamic away from job creation — precisely the opposite of what a reform-oriented system requires. In order to rectify these imbalances and avoid their potentially destabilizing implications, a shift in the mix of the Chinese economy must now occur.

The Chinese leadership is going out of its way to inform its own citizens, as well as those in the broader global economy, that it will now push for just such a rebalancing. That was certainly the major thrust of the recently approved 11th Five-Year Plan, and it was also the main theme of the just-concluded China Development Forum (CDF) that I participated in last week in Beijing. Over the years, I have found the CDF to be invaluable in providing a window into the China debate. It is timed to take place within days of the completion of the National People’s Congress — the annual gathering of the Chinese legislature. The debate at the CDF is fresh and the message is relevant. It brings the Premier, together with several of the senior ministers and other leaders of the Chinese government, into open and active discussions with both the domestic and the international community. Since its inception in 2000, this relatively small conference has been used by official China to convey many important messages on the Chinese economy. That was the case of the pro-active fiscal stimulus unveiled during the global recession of 2000-01, the cooling down of an overheated Chinese economy in 2004, and the subsequent all-clear issued in 2005. In that context, and on the occasion of the passage of the latest five-year plan, I take the message of the 2006 China Development Forum as one that signals a very important milestone on the road to reform and transition.

more...

[KoKo]

62. Wasn't Roach in a tizzy about China Imbalances for the last year?

Seems that just last month he wrote a column very worried about Chinese pulling out of our treasuries. Yet, in this column he seems to be very comfortable, indeed happy about China changing course.

Did I miss something? Is he thinking that Bernanke will suddenly wake up and do something different from printing money and throwing it out of his helicopter if our trade imbalance slows because of China's new positioning.

Anyone have any views on this article and why do I find it so odd. :shrug: Wouldn't China's new plan mean they start to sell of our treasuries...meaning bad news? Or, is Roach thinking it will be so gradual we won't even notice it and he thinks that's a good thing.

[54anickel]

64. Well, my thought is that in this article Roach is looking at the macro

scenario. If you notice, he doesn't address the direct impact on the US in this article at all. He's basically saying that China is getting it's shit together pretty well, if they are able to continue it will be pretty good for the global economy as a whole. I believe he's hopeful that as the rest of the globe adjusts the US will somehow be dragged along to some degree. He still writes some very damning articles regarding the US. It's just he's leaning toward China's perspective on this one.

I think your question hits on what he's been hinting at. The global economy no longer revolves solely around the US, it's evolving. The world will make it with or without us one way or another. The US is quickly becoming an albatross around the global economy's neck anyway, they are moving forward on what they need to do in their own best interests. JMHO

[KoKo]

68. Good explanation....makes sense.

Now that I read what you say...I realize what I thought was odd was that he didn't address the effect of this on the US. The article seemed to be so upbeat it threw me.

In a way his optimism about China carrying through on their "re-balancing" could be a subtle dig at our policy by acknowledging just what you say: "The world will make it with or without us one way or another. The US is quickly becoming an albatross around the global economy's neck anyway, they are moving forward on what they need to do in their own best interests."

The hanging question though is:
What happens to our great GDP numbers if we have to stop buying all their imports as our real estate boom unwinds and the mortgage/banking and venture capitalists plus all the speculators and real estate agents servicing them find they need to get some "re-training" causing our unemployment numbers to rise. The homeowners will no longer be able to "re-fi" and will be forced to tap out of their equity or be foreclosed on due to the "inflation" the Bushies deny exists and the last bubble
the "powers that be" could finagle goes bust. Grim times. :-(

I'm guessing Roach is hoping this will cause some re-balancing here in the US and that's a good thing if it's done properly. With the Bushies in power I guess we can figure it won't be done properly. We have to hope some adults come in and save them from themselves, I guess.

[54anickel]

58. Double jeopardy revisited

http://www.321gold.com/editorials/chapman_d/chapman_d_032706.html

We continue to hold the view that the two biggest risks going forward for global markets are rising global interest rates and an ongoing deterioration in global geopolitics. There is also another issue that appears to be coming to the forefront as well. Protectionist sentiment, always an issue in the USA, is once again on the rise both in the US and as well in Europe. And in both instances the target is primarily China.

snip>

In the interim, however, all signs are pointing to a continued rise in interest rates possibly even beyond what the market is expecting. And interest rates are rising in Europe and Asia as well and therein lies the problem for the carry trades that have helped fuel stock and bond markets for the past few years. Falling interest rates are a boon to the carry trades but rising interest rates are a major problem. It raises the risks that the carry trade speculators will be forced to dump assets. With numerous markets in India, the Philippines, Indonesia, Thailand and Latin America at all time highs the risks are rising as interest rates creep higher.

While record current account surpluses and foreign exchange reserves will probably allow the Asian countries to avoid any meltdown as we saw in when the Thailand Bhatt collapsed in 1997 others may not be so lucky. There are two collapses that bear close watching going forward and their possible impacts on the rest of the world. The first is in the Mid East where high flying markets in Kuwait, UAE, Qatar and Saudi Arabia have suffered sharp corrections thus far this year on heavy volume. This has occurred despite the massive amounts of oil money and strong economies in these countries. The UAE recently lost the US ports deal and a strike has stopped construction on what is to be the world's tallest structure.

The other problem is in Iceland. This is the carry trade nightmare. Icelandic banks borrowed heavily on European markets and invested in high yielding Iceland bonds that were over 10%. In February the Iceland Krone collapsed and interest rates are rising in Europe. The result the carry trades are blowing up. The Iceland banks have debt the equivalent of 150% of Iceland GDP maturing in the next two years. A banking crisis and collapse appears to looming sharply on the horizon. And with it could go the Iceland economy where a country debt default is highly probable given their debt is 300% of GDP. The Icelandic Krone is expected to lose even more in the coming months and in turn that could trigger a bigger global problem. At this stage Iceland is in deeper trouble than Thailand was at the same stage in 1997.

Nor is Iceland an isolated case. The British rating agency Fitch recently warned about a "general increase in bank systemic risk in the last six months". The problem as Fitch warned is the huge build up because of sustained low interest rates of equity and property bubbles. Fitch noted there is now "a high level of vulnerability to potential systemic distress in some countries" noting in particular Ireland, Norway, Russia, South Africa and the aforementioned Gulf states (Executive Intelligence Review March 21, 2006). The property bubble in particular is starting to show signs of stress with new mortgages down sharply from a year ago in the US and recent reports of housing sales are falling below expectations.

snip>

Bush's popularity continues to plummet along with Iraq and Vice President Dick Cheney's poll numbers are in the teens. And for the White House is going to get worse. Last week 8 US House of Representatives joined as co-sponsors of HR 635 calling for a select committee to investigate the grounds for the impeachment of George W. Bush over misleading the public on the need to go to war, supporting torture (Abu Ghraib, Guantanamo Bay) and illegal domestic spying. In the Senate Senator Russ Feingold who introduced a censure motion on March 13 emphasising the alleged lawbreaking over wiretapping is leading the charge. Senator Feingold added "I think we are required to do our job, to live up to our oath of office, and say, wait a minute, there has to be, at least as a first step, some accountability".

more...

[54anickel]

60. Are Republicans or Democrats Better for the Stock Market?

http://finance.yahoo.com/columnist/article/futureinvest/3022

As President's Bush's popularity plummets and the outlook for the Republicans controlling both houses of Congress and the presidency fades, it is important for investors to ask: "Should this matter to the stock market? Are prospects of a Democratic victory in November bad for stocks?

Certainly the recent behavior of the stock market says "No!" At the same time the woeful poll numbers were reported, stocks, measured by all the popular indices, hit 5-year highs.

For the stock market to ignore Bush's unpopularity seems strange. The vast majority of large stockholders and active traders are Republicans, and Republican rhetoric is generally very market-friendly. The market's movement in the last presidential election indicates it preferred a Republican victory.

The Bush-Kerry Election

On the afternoon of Election Day, November 2, 2004, exit poll numbers were released from both Florida and Ohio that suggested Kerry was doing much better than expected. If the Democrats took Ohio or Florida, electoral math made it very difficult for Bush to win.

Immediately upon the release of Kerry's supposed success, there was a sell-off in stocks. The Dow Industrials, which were up strongly early in the day, plunged about 100 points when the polls were released. But in the evening, the exit polls proved wrong, and Bush was the clear victor. The following day stocks made up all the lost ground and then some.

snip to the puker ending>

Nevertheless, tax policy is only one element that impacts the stock market. Economic growth, interest rates, and world trade and capital flows will ultimately be more important in determining the market's direction. Ultimately the party that does the right thing for America will be rewarded by good stock returns, whether this is under the Republicans or Democrats. And the Democrats must recognize that stocks are held by millions of Democrats as well as Republicans and keeping the market healthy is a high priority. Perhaps that is why stocks are ignoring the Bush polls.

[UpInArms]

61. 2:35 EST pixie dust appearing in the pits

Dow 11,260.36 -19.61 (-0.17%)
Nasdaq 2,317.76 +4.94 (+0.21%)
S&P 500 1,302.54 -0.41 (-0.03%)
10-Yr Bond 4.705 +0.30 (+0.64%)

NYSE Volume 1,402,869,000
Nasdaq Volume 1,367,048,000

2:30 pm : More of the same for stocks as the Nasdaq continues to outpace its blue chip counterparts. On the Dow, Honeywell (HON 41.86 -0.59) remains the biggest laggard while Johnson & Johnson (JNJ 59.84 -0.55), losing ground after regulators approved a competing dosing regimen, has also contributed to index weakness. Of the eight components posting gains, Alcoa (AA 30.54 +0.71) still paces the way after Citigroup raised its 2006 price forecasts for aluminum while General Motors (GM 23.08 +0.43) is at session highs after management said its U.S. retail selling rate has "stabilized" and is in line with new pricing strategy. DJ30 -29.73 NASDAQ +4.73 SP500 -1.04 NASDAQ Dec/Adv/Vol 1589/1410/1.34 bln NYSE Dec/Adv/Vol 1850/1363/952 mln

2:00 pm : Stocks still mired in relatively tight trading ranges, showing little reaction to further appreciation in Energy as oil futures continue to climb. Speaking of commodities, gold futures ($567.40/ounce +$6.90) recently closed near their highest level in three weeks amid some safe-haven buying ahead of the Fed and weakness in the greenback which has made dollar-denominated commodities more attractive. DJ30 -33.58 NASDAQ +4.89 SP500 -1.09 NASDAQ Dec/Adv/Vol 1592/1386/1.25 bln NYSE Dec/Adv/Vol 1854/1325/880 mln

[Roland99]

63. Wait a minute...aluminum is going to be more expensive?

Won't that affect PPI?

[54anickel]

65. Woo-hoo! I haven't cleaned out the garage yet of all those bags

of crushed cans. I'm gonna be RICH!!!

[Roland99]

67. My daughter's been saving the tabs from soda cans.

Have about 2lbs of them! She can go to Harvard now!!

[54anickel]

66. More bankruptcies expected among US auto suppliers: analysts

http://news.yahoo.com/s/afp/20060326/ts_afp/usautosuppliers_060326183942

DETROIT, United States (AFP) - More bankruptcies are expected among US auto suppliers which are being squeezed by demands for lower prices for fewer parts as General Motors Corp and Ford Motor Company implement massive restructuring plans, analysts said.

The shakeups among suppliers have placed manufacturers at an increased risk of costly production delays as unions respond to wage and benefit cuts.

A strike could hit GM's largest parts supplier in the coming weeks.

Delphi has warned it will ask a bankruptcy judge to void its contract with the United Auto Workers union if the two parties are unable to reach agreement on wage cuts by March 30. The UAW has responded by threatening to strike if the request is granted.

A coalition of unions have also warned Tower Automotive, which supplies body structures, lower vehicle structures, suspension components and modules for nearly every major automotive manufacturer, that it will strike if a bankruptcy court voids their contracts.

more...

[UpInArms]

70. GM get ready to axe engineering staff in Warren, Mich

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-27T213709Z_01_N27276942_RTRIDST_0_AUTOS-GM-JOBS.XML

DETROIT, March 27 (Reuters) - General Motors Corp. (GM.N: Quote, Profile, Research) is expected to start cutting thousands of U.S. salaried workers on Tuesday as part of a sweeping restructuring aimed at stemming losses and market share, a source close to the situation said on Monday.

Tuesday's cuts will be in the engineering division, the source said. He also said reductions in sales and marketing staff would be announced in April.

The job cuts will be the first of those announced last November, when the struggling automaker said it would let go of 7 percent of its 36,000 white-collar U.S. employees this year.

A GM spokesman declined comment, saying the company had "nothing to announce or confirm."

<snip>

The atmosphere at GM's Warren Technical Center in Michigan was tense on Monday, as engineers remained uncertain about their future, the source said. Employees have been told to cancel vacations scheduled on Tuesday, he added.

...more...

[UpInArms]

71. closing numbers and blather

Dow 11,250.11 -29.86 (-0.26%)
Nasdaq 2,315.58 +2.76 (+0.12%)
S&P 500 1,301.61 -1.34 (-0.10%)
10-Yr Bond 4.701 +0.26 (+0.56%)

NYSE Volume 1,976,771,000
Nasdaq Volume 1,851,410,000

4:20 pm : Per usual, the market traded with a sense of caution Monday as investors stayed close to the sidelines ahead of the first FOMC meeting in 19 years not chaired by Alan Greenspan. While a 15th consecutive 1/4% hike in the overnight lending rate has already been priced into the market, uncertainty as to the whether or not the wording of the policy statement will offer clues about the direction for interest rates underpinned a sense of nervousness and stalled some of the wishful thinking behind recent market strength. The S&P 500, which is up 4.5% in 2006, is positioned to record its biggest first-quarter gain in seven years.

Since Fed Chairman Bernanke has given no indications of his policy leanings and economic conditions have not changed, there is more of a risk that Tuesday's policy statement will be a disappointment. Briefing.com chief economist Tim Rogers -- the only prognosticator to rank in the USA Today's top 10 all three years -- does not see a lot of inflation pressures and believes the Fed will raise rates just once more this year after Tuesday.

With regard to sector strength and weakness, industry leadership was evenly split. Of the five economic sectors closing lower, Health Care was the day's biggest drag on stocks following analyst downgrades on medical equipment stocks (e.g. ZMH, SYK) and consolidation in the drug group. Consumer Staples was another influential leader to the downside as weakness in tobacco, beverages and food retail offset a mixed report from Walgreen (WAG 45.03 +0.66) which missed forecasts by a penny but grew profits and market share.

Among the five sectors trading higher, Materials paced the way to the upside after Citigroup raised its 2006 price forecasts for copper and aluminum and upgraded Phelps Dodge (PD 76.50 +1.36), a suggested holding in our Active Portfolio. Energy, which turned positive as trading entered the lunch hour in sympathy with a rebound in oil prices, held onto modest gains while Technology eked out a small advance as strength in hardware and networking offset consolidation in semiconductor and software. Despite a rise in borrowing costs and Lehman downgrading bank stocks worldwide on valuation concerns, Financial nearly found enough strength from brokerage and insurance names to offset weakness in rate-sensitive issues but the sector finished flat. The absence of market moving economic reports -- data which the Fed has made clear will influence monetary policy -- left bond traders focused on technical indicators and kept volume lighter than usual ahead of tomorrow's Fed decision. The yield on the 10-yr note (-07/32) closed at 4.69%. BTK -0.4% DJ30 -29.86 DJTA +0.7% DJUA -0.9% DOT +0.1% NASDAQ +2.76 SOX -0.2% SP500 -1.34 XOI +0.5% NASDAQ Dec/Adv/Vol 1567/1502/1.86 bln NYSE Dec/Adv/Vol 1876/1392/1.37 bln