STOCK MARKET WATCH, Tuesday March 13

[ozymandius]

Tuesday March 13, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 678 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2269 DAYS
WHERE'S OSAMA BIN-LADEN? 1973 DAYS
DAYS SINCE ENRON COLLAPSE = 1933
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 9
Enron execs conveniently deceased = 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 12, 2007

Dow... 12,318.62 +42.30 (+0.34%)
Nasdaq... 2,402.29 +14.74 (+0.62%)
S&P 500... 1,406.60 +3.75 (+0.27%)
Gold future... 650.30 -1.70 (-0.26%)
30-Year Bond 4.69% -0.03 (-0.66%)
10-Yr Bond... 4.55% -0.04 (-0.78%)






GOLD, EURO, YEN, Loonie and Silver


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. Today's Market WrapUp

Lost In the Weeds
BY ROB KIRBY

Today, I would like to touch on a couple of seemingly innocuous developments which I learned of in the past week.

First, I would like to direct everyone’s attention to a piece penned by Jim Willie – titled, Gold Sniffs Rate Cut. I consider the piece a ‘must read’ for anyone trying to make sense of today’s conflicted news reporting being served up by mainstream financial news outlets.

“Why just last week the Board of Governors at the Federal Reserve System voted to reduce disclosure requirements in what are known as Call Reports for major shareholders and officers for member banks.”

-cut-

I cannot help but shake my head once again at the timing of the Fed’s move to “relax” reporting standards regarding these same derivatives. It would appear, with Iran set to “outlaw the use of the almighty U.S. dollar” as of March 21, 2007 – the Fed is proactively moving to ‘neutralize’ (or hide from public view, perhaps?) the reverberations that one might prudently expect to be felt in global currency markets as a result.

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

[nitpicker]

36. Accredited, New Century lead subprime meltdown

Wednesday March 14, 2:09 AM
Accredited, New Century lead subprime meltdown
By Jonathan Stempel and Dan Wilchins

NEW YORK, March 13 (Reuters) - The meltdown among U.S. subprime mortgage lenders broadened on Tuesday, as shares of Accredited Home Lenders Holding Co. lost two-thirds of their value and New Century Financial Corp. sank, with investors fearing both would run out of cash.

Accredited , based in San Diego, said it needed to raise money after paying $190 million demanded by its lenders, is cutting an unspecified number of jobs, and is exploring "strategic options," including raising new capital.

ADVERTISEMENT


Irvine, California-based New Century , meanwhile, had trading in its shares suspended by the New York Stock Exchange prior to delisting and received a grand jury subpoena in a federal criminal probe. On Monday, the real estate investment trust had said it did not have enough cash to repay its own lenders.

Tuesday's disclosures are the latest blows in the subprime area, where lenders make loans to people with poor credit histories. Data released on Tuesday show late payments on U.S. mortgages at a 3-1/2 year high. Investors are worried that more lenders might restructure or seek bankruptcy protection.

"There's not going to be many independent subprime lenders left," said Blake Howells, director of research at Becker Capital Management in Portland, Oregon, which invests $2.5 billion.

Lenders have been battered by rising defaults and demands from their own lenders to take back soured loans at a loss.

Lax underwriting standards fueled the problems. More than two dozen lenders have quit the industry in the last year. Many analysts say New Century is on the brink of bankruptcy.

Accredited spokesman Rick Howe did not immediately return a call seeking comment. New Century spokeswoman Laura Oberhelman declined to comment.

Accredited skidded to a record low, falling $7.60 to $3.80 on the Nasdaq before recovering a bit to $4.35 in afternoon trading. New Century, now listed on the Pink Sheets, fell 57 cents, or 34.3 percent, to $1.09.

DELINQUENCIES RISE

Shares of other mortgage lenders also fell, as new data suggested that rising delinquencies are weighing on lenders that make higher-quality loans.

On Tuesday, the Mortgage Bankers Association said mortgage delinquencies rose to 4.95 percent in the fourth quarter from 4.67 percent in the prior quarter. Foreclosures also rose.

Delinquencies rose in 49 U.S. states and among all loan types, with the steepest increase among subprime adjustable-rate loans, the group said.

"Subprime borrowers are more likely to be susceptible to the cumulative increases in interest rates that we have experienced and the resultant nationwide slowing of home price appreciation," Chief Economist Doug Duncan said.

The chairman of the House Financial Services Committee, Rep. Barney Frank, said he plans to introduce legislation to restrict overly risky mortgages.

Meanwhile, Assistant Treasury Secretary Anthony Ryan told Reuters that subprime problems appear to be "fairly well contained," and that the Treasury Department is monitoring them.

In afternoon trading, shares of Kansas City, Missouri-based subprime lender NovaStar Financial Inc. fell as much as 23 percent.

Irvine-based Impac Mortgage Holdings Inc. and Pasadena, California's IndyMac Bancorp Inc. , which make loans to people who lack enough documentation to get prime loans, fell as much as 13 percent and 9 percent, respectively.

Shares of Countrywide Financial Corp. , the largest mortgage lender, fell more than 5 percent.

Financial services firms more dependent than some rivals on the mortgage market also declined. Shares of Bear Stearns Cos. and Lehman Brothers Holdings Inc. were down about 5 percent, and Friedman Billings Ramsey Group Inc.. fell as much as 19 percent.

MARGIN CALLS

Accredited said it has paid $190 million in margin calls on loan facilities since Jan. 1 as lenders demand more collateral. It said it received two-thirds of those calls since Feb. 15.

The company has said it ended 2006 with $345 million of available liquidity. It didn't say how much it now has.

New Century, meanwhile, on Monday said its lenders plan to halt financing, and said it might be forced to repay more than $8 billion it doesn't have. On Tuesday, it said it owes $500 million more than it previously disclosed to Credit Suisse . (For more about the subprime mortgage crisis, see ) (Additional reporting by Lynn Adler in New York and Svea Herbst-Bayliss and John Poirier in Washington)

[ozymandius]

2. Today's Reports

8:30 AM Retail Sales Feb
Briefing Forecast 0.2%
Market Expects 0.3%
Prior 0.0%

8:30 AM Retail Sales ex-auto Feb
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.3%

10:00 AM Business Inventories Jan
Briefing Forecast 0.2%
Market Expects 0.2%
Prior 0.0%

http://biz.yahoo.com/c/e.html

[UpInArms]

16. 8:30 reports: (gasoline sales up - who would have guessed?)

01. U.S. Feb. clothing store sales fall 1.8%
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

02. U.S. Feb. gasoline sales up 1.2% on higher prices
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

03. U.S. Jan. retail sales unrevised at 0.0%
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

04. U.S. Feb. general merchandise store sales fall 0.6%
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

05. U.S. Feb. auto sales up 0.9%
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

06. U.S. Feb. retail sales ex-autos, ex-gas down 0.3%
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

07. U.S. Feb. retail sales ex-autos fall 0.1% vs. +0.2% expected
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

08. U.S. Feb. retail sales up 0.1% vs. 0.2% expected
8:30 AM ET, Mar 13, 2007 - 34 seconds ago

[Roland99]

17. Cheaper gas in Jan. got more people driving and probably an increase in SUV sales, too.

But, that will correct itself a little now that gas is up nearly $0.50 nationwide in the last 5-6 weeks.

[UpInArms]

18. Retail sales flounder in February

http://money.cnn.com/2007/03/13/news/economy/retail_sales/index.htm

NEW YORK (CNNMoney.com) -- U.S. retailers suffered lackluster sales last month with total sales coming in weaker-than-expected, according to a government report Tuesday.

The Commerce Department said retail sales rose an anemic 0.1 percent last month. Economists surveyed by Briefing.com on average had forecast an increase of 0.3 percent for February.

Sales excluding autos and auto parts dipped 0.1 percent last month in February. Economists had forecast a 0.3 percent ex-auto increase last month, according to Briefing.com.

Last week, the nation's chain stores including Wal-Mart (Charts), J.C. Penney (Charts), Gap (Charts) and others reported disappointing sales at their stores open at least a year, which is a key measure of retail performance known as same-store sales.

...bit more...

gotta run!

:hi:

[Roland99]

20. Let's see...how will they spin this?

Sign of decreasing pressures on inflation due to a calming of the "on fire" economy, perhaps?

[radfringe]

24. blame it on VALENTINE SNOW STORM ?

[ozymandius]

25. Either you guessed right - or you read the article.

Retailers blamed colder weather for crimping shoppers' enthusiasm last month.

This means something if you're shopping for a house. Houses tend to move faster during the warm weather months. For everything else I will idly speculate that people were probably preoccupied with more important things. Like paying the mortgage. Or perhaps buying food.

[radfringe]

26. Good guess on my part -- but I had other possible explainations

1. Snow and cold weather
2. A CEO's cat hacked up a hair ball
3. School children's macaroni collages fall apart

I was leaning heavily towards possiblity #2, but Possibility #1 seemed the lamest excuse

[UpInArms]

22. 10:00 report and other stuff

06. U.S. Jan. retail inventories up 0.2%
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

07. U.S. Jan. business sales fall 0.7%
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

08. U.S. Jan. inventory-sales ratio rises to 1.30 vs. 1.28
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

09. U.S. Jan. inventories rise 0.2% as expected
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

10. Housing market recovery 'likely' in 2007: NAR
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

11. Existing-home sales projected at 6.42M for 2007: NAR
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

12. New-home sales forecast at 950K in 2007: NAR
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

13. Nat'l median existing-home price seen up 1.2 percent: NAR
10:00 AM ET, Mar 13, 2007 - 16 minutes ago

[ozymandius]

3. Oil prices climb back above $59 a barrel

SINGAPORE - Oil prices rose Tuesday as traders perceived that an overnight drop of nearly 2 percent was overdone given the outlook for continued strong energy demand and declining U.S. gasoline inventories.

Light, sweet crude for April delivery gained 33 cents to $59.24 a barrel in Asian electronic trading on the New York Mercantile Exchange, mid-afternoon in Singapore. The contract dropped $1.14 to settle at $58.91 a barrel Monday.

"The last couple of days have been feeling a bit like a recoil as the weather's got warmer in the U.S. and temperatures have also gone down in the
Iran issue," said Tobin Gorey, commodity strategist at Commonwealth Bank of Australia in Sydney. "Today it looks like the market is recovering some lost ground."

-cut-

The U.S. National Weather Service is predicting above-normal temperatures in most parts of the U.S. Northeast and Midwest for the next two weeks, leading traders to bet that the heating oil season is ending. On Monday, temperatures hit about 60 degrees Fahrenheit in New York, Chicago, and Washington, according to AccuWeather.com.

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

[ozymandius]

10. Crude Oil Rises on Speculation U.S. Gasoline Supplies Dropped

March 13 (Bloomberg) -- Crude oil rose in New York on speculation a government report will show a decline in U.S. gasoline supplies, prompting refiners to increase processing to meet summer demand.

U.S. gasoline stockpiles probably fell 2.45 million barrels in the week ended March 9, according to a Bloomberg survey of analysts. Refiners may increase output to meet peak annual demand at the time of the Memorial Day holiday in late May. Fires and power cuts trimmed output at plants in Texas, California, Pennsylvania, Colorado, Delaware and Ontario over the past month.

-cut-

Crude oil for April delivery rose as much as 44 cents, or 0.8 percent, to $59.35 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $59.33 at 12:08 p.m. in Singapore.

The contract fell $1.14, or 1.9 percent, to $58.91 yesterday, the lowest settlement price since Feb. 20. Prices fell almost $3 a barrel the past three sessions as mild weather in the U.S. Northeast contributed to a 5 percent decline in heating oil prices.

http://www.bloomberg.com/apps/news?pid=20601085&sid=az7PKSTtbpHY&refer=europe

[nitpicker]

15. Look for maybe a decline in the US markets this morning.

Between that and the rise of the yen, that may be why the major Euro stock markets suddenly swooped down a half-percent.

[Ghost Dog]

28. Europe stocks dip as banks hit by U.S. housing woes

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2007-03-13T163942Z_01_L13105341_RTRIDST_0_MARKETS-EUROPE-STOCKS-URGENT.XML

LONDON, March 13 (Reuters) - European shares dropped on Tuesday and ended at the day's low as banks were rattled by concerns about their exposure to a troubled U.S. housing market and worries that growth in the U.S. economy will be derailed.

The pan-European FTSEurofirst 300 index <.FTEU3> closed unofficially down 1 percent at 1,466.97, marking the day's low after a retreat by U.S. shares gathered pace.

The DJ Stoxx European banking sector index <.SX7P> fell 1.5 percent, with Barclays (BARC.L: Quote, Profile , Research), Santander (SAN.MC: Quote, Profile , Research) and Royal Bank of Scotland (RBS.L: Quote, Profile , Research) among the main losers as banks on both sides of the Atlantic have been unsettled by deepening troubles among U.S. subprime mortgage lenders.

Takeover speculation and other corporate activity continued to support selected stocks, however, and shares in confectionery firm Cadbury Schweppes (CBRY.L: Quote, Profile , Research) leapt 10.5 percent after it said U.S. activist investor Nelson Peltz had built a 3 percent stake.

[ozymandius]

4. Flight to safety sparks global bond rally

Bad news from the US subprime mortgage market sparked a global search for safe havens and a rally in government bond prices on Monday as fears grew that subprime woes could spread to the wider US economy.

The US bond market rebounded from a sharp sell-off in bond prices on Friday, as shares in New Century, the second largest subprime lender in the US, were halted from trading.

-cut-

The bond market faces retail sales figures on Tuesday and inflation data later this week. In spite of expectations that retail sales will have grown in February, the bond market is paying closer attention to the US housing market, say traders.

Fears about US subprime lending drove European government bonds upward around midday after a morning in negative territory.

http://news.yahoo.com/s/ft/20070312/bs_ft/fto031220071655347929

[Ghost Dog]

42. Why investors were not as diversified as they had thought

http://www.economist.com/finance/displaystory.cfm?story_id=8829603
Buttonwood
We all fall down

Mar 8th 2007
From The Economist print edition
Why investors were not as diversified as they had thought

DON'T put all your eggs in one basket. Investors are taught at stockmarket elementary school that the secret to avoiding financial disaster is to make sure they diversify their portfolios.

But when markets plunged on February 27th shelter was pretty hard to find. First China fell, then European markets, then Wall Street. Emerging markets suffered. Corporate-bond spreads widened (in other words, their prices dropped). Oil declined. Even gold, a supposed “store of value”, took a hit. Only the yen and government bonds gained ground.

This marching-in-step has been described by Henry McVey, a Morgan Stanley strategist, as a “market of one”. Diversification did not bring the benefits that investors might have expected.

Perhaps it should not be too surprising that, according to Merrill Lynch, over the past five years the Russell 2000 index of small American companies has a 94% correlation with the S&P 500, the main Wall Street index. More alarmingly, international stockmarkets have not offered any diversification either: they have shown a 95% correlation. Yet more startling are the figures showing that hedge funds have recorded a 94% link with shares. Even property has been following Wall Street 81% of the time.

Why should this be? The obvious explanation is the much-touted “excess liquidity” that has been driving up one asset price after another. There is a healthy debate about how to measure this liquidity, or indeed whether the term has any real meaning. But most people agree that the savings surpluses in Asia and the oil exporters have played an important part in fuelling financial markets. JPMorgan estimates that global liquidity increased by $3.9 trillion between 2002 and 2006, of which around 50% came from Asia and 40% from the oil producers.

The bulk of this money went at first into risk-free assets such as Treasury bills and bonds. That drove down the yield on such assets. So other investors were then naturally tempted to look elsewhere for higher returns.

Meanwhile, pension funds have been trying to reduce the bets they have made on shares. This combination has unleashed a “chase for yield” as any asset with an above-average income (or which offered the prospect of above-average returns), has been driven up in price. More speculative investors have been tempted to borrow at the risk-free rate and invest in risky securities, one version of the talked-about “carry trade”.

/...

[ozymandius]

5. Ford to sell Aston Martin

GAYDON (Reuters) - Ford Motor is selling luxury car maker Aston Martin to a group fronted by former Benetton and BAR motor racing boss David Richards in a deal worth 479 million pounds.

The second-biggest U.S. carmaker said on Monday it would retain a 40 million pound investment in Aston Martin, the carmaker James Bond spy films made famous, and that it expected the deal to close in the second quarter of this year.

-cut-

Ford said in August it was considering the sale of Aston Martin to free funds to invest in its other brands amid a sharp downturn in sales.

The U.S. group posted the biggest loss in its 103-year history in 2006, falling $12.7 billion (6.5 billion pounds) into the red, as high fuel prices and interest rates drove consumers away from the trucks and sport utility vehicles that had accounted for most of its sales and profits.

http://uk.reuters.com/article/businessNews/idUKL1230374620070313

[ozymandius]

6. New Century tells investors it's about to lose financing

LOS ANGELES -- The prospect of bankruptcy loomed over New Century Financial Corp., as the subprime mortgage lender scrambled Monday to stay afloat after all of its bank lenders either cut off funding or informed the company of their intent to halt financing.

In a filing with the Securities and Exchange Commission, the Irvine, Calif.-based company said Monday that it received letters from Wall Street lenders, including Bank of America, Goldman Sachs, Morgan Stanley and Citigroup, alleging events of default.

The company said there is no guarantee it will receive additional financing.

http://seattlepi.nwsource.com/business/307174_newcentury13.html

[ozymandius]

8. Big Banks May Be Chum

As the sharks circled beleaguered subprime lender New Century Financial Monday, speculation also swirled about which investment banks held the most exposure to the sector.

Wall Street has enthusiastically financed mortgage lenders over the latest real estate boom cycle, providing loans for companies such as New Century (nyse: NEW - news - people ) to fund new mortgages that the investment firms could buy up, package into bundles of securities and sell to yield-hungry investors. More than $1 trillion of these mortgage-backed securities were sold in the U.S. alone last year.

But in the process of buying the loans and packaging them up, investment banks retain some risk of loss, including accounting items like loans held for sale, loans held for investment, retained interests in the securitizations themselves, and so-called warehouse loans that keep the origination engines at the small mortgage lenders humming.

http://www.forbes.com/business/2007/03/12/new-century-banks-biz-cx_lm_0313banks.html

[nitpicker]

13. SEC getting involved re New Century

http://www.reuters.com/article/ousiv...42127420070313

New Century says SEC conducting investigation
Tue Mar 13, 2007 7:22AM EDT

NEW YORK (Reuters) - New Century Financial Corp. (NEW.N: Quote, Profile, Research) on Tuesday said the U.S. Securities and Exchange Commission is investigating the subprime mortgage lender, after the agency recently asked to meet with management to discuss its accounting.

New Century also said it has received a grand jury subpoena requesting documents. The request is part of the U.S. Attorney in Los Angeles' criminal probe into the company.

The legal woes follow the subprime lender's announcement on Monday that its lenders plan to halt financing, pushing the company closer to bankruptcy.

New Century's struggles are part of a wider meltdown among lenders to less credit-worthy home buyers who are defaulting on mortgages in increasingly large numbers.

[ozymandius]

39. This is what Bonddad says is happening.

from his Kos diary

This is a standard part of the securitization industry. Here's how it generally works.

1.) Subprime company makes loan.

2.) Subprime company sells loan to larger bank.

3.) Larger bank pools loan with other, similar loans (same interest rate, same maturity etc....) and then sell pools to various investment groups (insurance companies, mutual funds etc...). Basically, the larger banks make one giant bond of all the loans they buy.

As part of step 2, the subprime originator agrees it will repurchase a loan under certain conditions, one of which is usually a specific delinquency rate.

Although the specifics vary from deal to deal, repurchase agreements obligate the mortgage originator, under some circumstances, to buy back a troubled loan sold to a bank or investor. That obligation sometimes kicks in if the borrower fails to make payments on the loan within the first few months or if there was fraud involved in obtaining the original mortgage. The total volume of mortgages nationwide that might meet those criteria isn't known, but such agreements cover billions of dollars in mortgages.

-Wall Street Journal

When a large number of loans go into delinquency early, the larger banks can flood the subprime originator with repurchase requests. This can bankrupt the subprime originator which is exactly what is happening right now.

[Ghost Dog]

41. Will turbulence in America's subprime mortgage market spread?

http://www.economist.com/finance/displaystory.cfm?story_id=8829612
Subprime lending
Rising damp

Mar 8th 2007
From The Economist print edition
Will turbulence in America's subprime mortgage market spread?

LAST November the American publisher of those bright-yellow books that claim to help “dummies” master everything from trigonometry to anger management released “Flipping Houses for Dummies”. It promised to teach would-be property moguls how to “lay the foundation for successful flipping and bring home the bucks”. Four months later, it is the seemingly indomitable housing market that has flipped. One of its main engines of growth, the subprime-mortgage industry, is in free-fall. Where it lands is anyone's guess.

...

This could lead to credit losses and foreclosures. Credit Suisse thinks “marginal” borrowers make up a third of subprime loans. But banks and holders of securities backed by these mortgages could get hit too. Spreads on subprime-mortgage-backed securities have widened sharply. Demand has dropped. New issues rated by S&P fell 29% in the fourth quarter of last year over the same period in 2005.

Others are scrutinising “Alt A” mortgages, underwritten with little or no documentation of, say, a borrower's income. Arrears have risen sharply, too, although they are nowhere near as high as in subprime. Around $400 billion of such loans were written last year, which is 13% of the total market and the fastest-growing chunk of it. Fitch, a ratings agency, reckons that mortgage loans underwritten with less-than-complete documentation standards made up over half the subprime loans.

The effects of a dramatic slowdown, or credit crunch, in the subprime and the Alt A market could spread. The stock of unsold homes would remain unsold longer, crimping house prices. Consumer spending might slow. Investors might shy away from securities backed by prime mortgages and other assets, not just subprime ones, pulling liquidity out of the market.

Not everyone is so pessimistic. Bargain investors are on the prowl. Last week Citigroup agreed to put money into ACC Capital, the parent of Ameriquest Mortgage, a struggling lender. Citadel, a huge hedge fund, beat Credit Suisse when it snapped up ResMAE, a newly bankrupt subprime-mortgage lender, for $22m. The bet is that when the subprime mortgage market turns around, Citadel and others will be ready.

[Ghost Dog]

46. Senate Weighs Aid to 2.2 Million Subprime Borrowers

http://www.bloomberg.com/apps/news?pid=20601087&sid=a1x64z58hsB4&refer=home

March 13 (Bloomberg) -- U.S. lawmakers will have to consider providing aid to about 2.2 million subprime mortgage borrowers who are at risk of defaulting and losing their homes, Senate Banking Committee Chairman Christopher Dodd said today.

``The impact of losing 2.2 million homes I suspect will be in a lot of areas of our cities and towns that are already pretty hard hit, so we clearly want to look at that and legislate,'' Dodd, a Democrat from Connecticut, told reporters in Washington after a speech to the National League of Cities.

Foreclosures involving homeowners who took out subprime loans from 1998 until 2006 could cost $164 billion, Dodd said, quoting a December study by the Center for Responsible Lending in Durham, North Carolina. The government needs to provide at- risk homeowners ``forbearance or something like that to give them a chance to work through and get a new financial instrument here that they can manage financially better,'' Dodd said.

/...

& DU: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x402732

[DemReadingDU]

49. Updates on Bonddad's blog

http://bonddad.blogspot.com/

[ozymandius]

7. Halliburton Chief's Move to Dubai Evokes Warnings on Hill

Ever since Erle P. Halliburton established the New Method Oil Well Cementing Co. in Oklahoma in 1919, his name has been associated with American corporate know-how in the oilfield services business.

But over the weekend, the company now known as Halliburton announced that its chief executive, Dave Lesar, would move to a new corporate headquarters in Dubai to focus on business in the Middle East, Africa, Europe and Asia.

The announcement sparked warnings from members of Congress, who suspected that the company once run by Vice President Cheney was trying to trim its tax bill and remove itself from the limelight here, where it has come under fire about the way it obtained and executed government contracts, especially those connected to troubled reconstruction projects in Iraq.

-cut-

Lawyers who specialize in corporate litigation said that Halliburton, as a company run by U.S. citizens and traded on U.S. stock exchanges, would still be subject to such laws as the Foreign Corrupt Practices Act and Sarbanes-Oxley.

http://www.washingtonpost.com/wp-dyn/content/article/2007/03/12/AR2007031201299.html

[ozymandius]

9. SEC charges ex-Nortel executives with fraud

March 13, 2007 (IDG News Service) -- U.S. and Canadian stock regulators filed fraud charges yesterday against several former executives of Nortel Networks Corp., accusing them of twisting accounting practices to make it seem that the company was meeting Wall Street expectations.

The U.S. Securities and Exchange Commission charged Frank Dunn, Nortel's former CEO and CFO, Douglas Beatty, the former CFO and controller, Michael Gollogly, the former controller and MaryAnne Pahapill, the former assistant controller.

-cut-

Nortel had no reaction to the new charges. "We have no comment on any proceedings against former officers or employees of the company. The company continues to cooperate fully with the regulatory authorities," spokeswoman Jamie Moody said in an e-mail.

-cut-

According to the SEC, between late 2000 and January 2001, Dunn, Beatty and Pahapill changed Nortel's revenue-recognition policies so they could appear to meet financial forecasts. And from July 2002 through June 2003, Dunn, Beatty and Gollogly created an illegal pool of reserve funds they used to fabricate profits, meet earnings targets and award bonuses.

http://computerworld.com/action/article.do?command=viewArticleBasic&taxonomyName=standards_and_legal_issues&articleId=9012979&taxonomyId=146

[ozymandius]

11. Indian hackers charged in computer, stock fraud

Washington - Three Indian computer hacker suspects have been charged by the United States in connection with a stock scam that artificially boosted equity prices using hacked websites.

The three men - two from Chennai and one who currently lives in Malaysia - face nearly two dozen charges of conspiracy, computer fraud, wire fraud, securities fraud and aggravated identity theft, the US Department of Justice said Monday. They said it was the first time individuals were arrested overseas for online brokerage scams in the United States.

The men allegedly scammed at least 60 customers in nine brokerage firms in the US and elsewhere. One firm alone reported more than 2 million dollars in losses, officials said.

-cut-

The men used their personal online brokerage accounts, hacked their way into other accounts or created false accounts with stolen identities to buy large quantities of low-priced company shares and jack up the price, according to the charges. They then sold the stocks for values that were inflated - in one case to nine times its 15-day average - officials said.

http://news.monstersandcritics.com/asiapacific/news/article_1276400.php/Indian_hackers_charged_in_computer_stock_fraud

[ozymandius]

12. Futures Point to Moderately Lower Open

NEW YORK (AP) -- U.S. stocks appeared headed for a moderately lower opening Tuesday as investors waited to see if economic and earnings figures would justify a further rebound from last month's selloff.

Tuesday's data arrive as investors try to determine the fallout from the subprime mortgage industry. Shares of New Century Financial, after further describing a raft of financial troubles Monday, remained halted Monday as the New York Stock Exchange began a review of the stock's listing status.

U.S. markets, which have taken some cues from overseas markets of late, could look to only a mixed performance abroad. Wall Street itself posted a moderate advance on Monday.

-cut-

Dow Jones industrials futures fell 7 points, or 0.06 percent, to 12,404.00. Standard & Poor's 500 index futures slipped 1.50, or 0.11 percent, to 1,418.00, while Nasdaq 100 index futures fell 3.25, or 0.18 percent, to 1,775.00.

http://biz.yahoo.com/ap/070313/wall_street.html?.v=2

[UpInArms]

14. dollar watch

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

Last trade 83.75 Change -0.13 (-0.15%)

Halliburton Move is Not Good for the Dollar

http://www.dailyfx.com/story/special_report/special_reports/Halliburton_Move_is_Not_Good_1173725526976.html

On Sunday, Halliburton Company, the largest military contractor in Iraq announced that it will be moving its headquarters along with the head of its company, Dave Lesar from Houston to Dubai, in the United Arab Emirates. For Halliburton shareholders, the benefits may be substantial, but for the US economy and the US dollar, Halliburton’s exit may particularly hurtful.

Even though CEO Lasar has indicated that the decision to move was to focus on the opportunities in Dubai, two more immediate benefits probably played a larger role in the company’s decision since more than 50 percent of the company’s business is still coming from North America. The first is the opportunity for substantial tax savings and the second is to avoid the consequences of recent legal inquiries. The evaporation of what is estimated to be hundreds of millions of dollars in taxes could widen the US budget deficit, raise concerns about protectionism, and encourage more US corporations to consider a similar move, which would be detrimental not only to the US economy and the US labor market, but also to the US dollar.

Why is Halliburton Relocating?

According to MarketWatch, in 2006, over one third or 38 percent of Halliburton’s $13 billion oil revenue was generated in the eastern hemisphere, which indicates that the company already does a lot of business in the Middle East. Dubai is the gateway to Middle East oil and many countries have already poured money into there. The Chinese government and corporations have been investing and developing in Dubai and clearly Halliburton wants a bigger piece of that pie. Furthermore, with many of the company’s subsidiaries located outside of the US, Halliburton is notorious for using tax havens and in Dubai, they will be paying next to zero in corporate taxes for the most part. Many employees In Dubai, who also live and work in one of their investment zones could be exempt from taxes as well. A city that can be described as Las Vegas on steroids the Western lifestyle is not only available, but taken to the next level with luxuries such as an indoor ski complex.

Moving to Dubai will also allow Halliburton to escape some recent scandals. Last week, Harper’s Magazine called Halliburton a Company of Thieves. The author, Ken Silverstein talked about an inquisition into bribing activities between the company and Nigerian officials back in 1995. According to ABC News, Halliburton is already being investigated by different government agencies for various allegations of improper business dealings, and it is in the cross hairs of Democrats in Congress for alleged over billing by $2.7 billion. Annual meetings have also drawn violent protests for their activities in Iraq – no company wants this type of publicity whether its warranted or not. Therefore from both an economic and political standpoint, Halliburton’s move to Dubai will be particularly advantageous to shareholders.

Will the US Block the Deal?

Yet, what is good for shareholders, may not be good for the economy. Congress is already upset about Halliburton’s move. NY Senator Chuck Schumer said “"For one of the largest contractors with the United States government to move its headquarters overseas? just doesn't look good, doesn't sound good, doesn't smell good." Concern for National Security could resurface, which brings back memory of the blocked Dubai Ports Deal and China’s bid for Unocal Corp. We are not sure how much Congress can actually do since this does not involve a cross border acquisition and Halliburton is a private company that will maintain some operations in the US. In order to keep the interests of their defense contracts in Iraq separate from their oil interests in Dubai, they will also be spinning off their KBR defense subsidiary into a completely separate company that will remain in the US. If Congress attempts to stop the move or screams louder about it, talk of protectionism will resurface.

...more...

Reasons to be Dollar Bearish: Sub-Prime, Halliburton, Retail Sales

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Reasons_to_be_Dollar_Bearish__1173732602340.html

US Dollar – Even though there was noUS data released today, the market had plenty of reasons to be bearish the US dollar. First, shares of New Century Financial were suspended for trading this morning, raising concerns that the company may have no choice but to file for bankruptcy. The problem in the sub-prime lending sector is worsening and run the risk of impacting the housing market as a whole. Mortgage lenders are expected to tighten their lending rules, regardless of whether they lend to the sub-prime market or not. With housing inventory at a 3 month high, prices could soon be affected as well. In addition to New Century Financial, Halliburton also announced that it will be moving its corporate headquarters from Houston to Dubai. Their move is a no-win situation for the US economy and US dollar. Not only will it shave hundreds of millions of dollars from tax revenue, but the economic and political consequences of their move could bring out old concerns that many traders and investors may have already forgotten about – which include the twin deficits and protectionism. If Halliburton gets away with this and Congress fails to block them, more US companies may follow suit – which could hurt the labor market and take away even more tax revenue. Adding to the dollar bearish sentiment in the market are expectations for weaker US retail sales tomorrow. February was one of the coldest months on record and Wal-Mart has already missed its sales forecasts as a result. Retail sales should set the tone for the first part of the week until Thursday when we have producer prices, net foreign purchases of US Securities and the Philadelphia Fed index on the docket.

...more...

[Ghost Dog]

31. Dollar Takes Another Tumble On Disappointing Sales Numbers

http://www.dailyfx.com/story/currency/eur_news/Dollar_Takes_Another_Tumble_On_1173806184471.html?engine=rss&keyword=article

Retail sales proved to be a disappointing trigger for the fundamental activity scheduled for the week. Dealing with higher fuel costs and bad weather, discretionary consumer spending failed to meet the market’s benchmark consensus. From price action in the majors, it was easy to see the market was in a trance before the US data hit the wires; and subsequently let down when the numbers flashed lower than traders had anticipated.

Leading the move, the deeply liquid EURUSD corrected off of a 1.3155 low prior to the New York session before charging 25 points above 1.32. In a more controlled fashion, USDCHF a 25-point range dominated for much of the overnight session before swinging 90 points lower to 1.2170. Though GBPUSD was on the move, it was still seemingly sapped for volatility. The pair rallied 80 points from intra-day lows to 1.9350 before finding resistance. Finally, the Japanese yen added to its advance after USDJPY slipped below 117.25 on its way to 116.50.

Traders across the globe are increasingly becoming aware of a general shift in the behavior of the currency market. Since the raucous a few week’s ago that upset the untouchable carry trade, the peak hours of volatility have shifted from the US to the Asian session. No doubt, this development helped to drain momentum from the dollar Tuesday morning even after the Commerce Department reported weaker than expected sales activity. According to the data, spending on retail goods rose 0.1 percent in February, falling short of the 0.3 percent pace predicted. However, the real disappointment didn’t come from the headline number. The devil so to speak was in the details. Many of the key components in monthly report made unexpected contractions. Activity related to the housing sector was particularly hard hit with building materials sales dropping the most since September, while those of furniture and electronics dropped 1.7 percent and 0.3 percent respectively. Another surprise came from the clothing group, which printed its biggest drop in sales activity since September 2005 in a 1.8 percent decline. While this may be attributable to frigid weather through most of February, it speaks more broadly for growth expectations. With the housing and manufacturing sectors already ailing, and business investment expected to be curbed by the uncertainty in equity markets, the consumer is the last pillar of strength for world’s largest economy.

When the sting of the retail report wore off, market participants looked for any other news to guide them to profits. From the economic indicators docket, there were few other reads to generate enough fundamental interest to push the dollar. The lagging business inventories number for January was largely overlooked, especially after coming in line with expectations for a modest 0.2 percent pick up. One interest aspect of the report was its correlation to today’s retail report. After today’s modest sales report, expectations for decreased factory activity has grown. Outside of the calendar, the currency market was also tuned into a conference on the competitiveness of US capital markets hosted by Treasury Secretary Henry Paulson and attended by some of the biggest names in the world of finance. A few of the key topics to be raised were the detriments and benefits of Sarbanes-Oxley and trade imbalances with China.

/...

[Ghost Dog]

32. European govt bonds higher as investors seek safety from US market jitters

http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=ac8e975a-b9e6-41d6-9d02-f70c550fcbc6

LONDON (AFX) - European government bonds remained higher as investors continued to seek the safety of bonds on worries that weakness in the US sub-prime mortgage market may spread to the rest of the economy.

After news that sub-prime mortgage lenders in the US were nearing bankruptcy or under stress from bad debts, equities have fallen and risk assumptions in the global markets have risen.

"It will take a while before confidence regains a firmer footing and until that time the resulting demand for safe haven cover will continue to boost government debt," said David Brown at Bear Stearns.

Adding further support to bonds were weak US retail sales, which rose a monthly 0.1 pct in February, below expectations for a 0.3 pct rise.

"This is a slightly disappointing report, which is likely to feed fears of a further housing-induced softening in consumer spending over the next few months," said Keith Gyles at Capital Economics.

He notes that the support to US consumption afforded by a previous fall in oil prices is now over, and that consumer confidence will weaken further and the University of Michigan confidence indicator on Friday should edge lower.

Bond prices did not feel the weight of a stronger-than-expected German ZEW business sentiment indicator this morning. The number rose to 5.8 in March from 2.9 in February and above a consensus for a more modest improvement to 3.1.

Analysts said the survey reaffirms the good outlook for German growth in 2007 and supports the view that the European Central Bank will raise interest rates again.

/...

[Eugene]

19. US retail sales up 0.1 percent, weaker than expected

(Agence France-Presse)
US retail sales up 0.1 percent, weaker than expected

12 minutes ago

WASHINGTON (AFP) - US consumers were cautious in February, pushing up retail sales
a modest 0.1 percent, government data showed Tuesday.

The Commerce Department's report on retail sales, a key component of economic activity,
was weaker than the 0.3 percent rise expected by Wall Street analysts.

Excluding the often volatile auto sector, retail sales fell 0.1 percent for the month.

-snip-

http://news.yahoo.com/s/afp/20070313/ts_alt_afp/useconomyretailsales_070313130738

[UpInArms]

21. 9:53 EST numbers and blather

Dow 12,264.31 54.31 (0.44%)
Nasdaq 2,393.48 8.81 (0.37%)
S&P 500 1,400.81 5.79 (0.41%)
10-Yr Bond 4.504% 0.049

NYSE Volume 303,954,000
Nasdaq Volume 183,903,000

09:40 am : With the Dow and S&P 500 up for three straight days, it's not surprising to see stocks take a breather and the bears looking for reasons to lock in recent gains. A market still focused on everything negative is again exaggerating the implications of an unwinding in the yen carry trade that really doesn't alter the fundamental condition of U.S. companies at all. Goldman Sachs' (GS 203.87 +1.27) cited significant weakness in the subprime mortgage sector, but still had a blowout earnings report and noted the broader credit market remains strong, which helps to put such potentially overblown subprime concerns in perspective.

Another piece of modestly bad news being blown out of proportion is the modest 0.1% gain in February retail sales and an unexpected 0.1% decline in sales (ex autos). Both figures are pressuring a market already extremely sensitive to signs of potential economic weakness even though it is likely that sales were held down by unseasonably cold weather. It is also worth noting that the data won't alter expectations of about 2% real GDP growth in Q1. DJ30 -77.71 NASDAQ -16.07 SP500 -8.52 NASDAQ Vol 82 mln NYSE Vol 46 mln

09:15 am : S&P futures vs fair value: -8.9. Nasdaq futures vs fair value: -12.8.

(just a fly-by posting)

[OrangeCountyDemocrat]

27. Unseasonably Cold Weather???

MY EYES....MY EYES....THE SPIN!!!

Since when is February supposed to be a Warm month?

What is the excuse going to be in March?

[Demeter]

37. Feb Temps Were 10F Below Average

and 15F below for the first half of March.

[nitpicker]

23. Accredited- the next subprime domino

Tuesday March 13, 10:29 PM
Accredited Home sinks 54 pct as cash falls short
NEW YORK (Reuters) - Accredited Home Lenders Holding Co. , a U.S. subprime mortgage lender, said on Tuesday it needed to raise cash after paying $190 million demanded by its lenders, sending its shares down as much as 53.5 percent to a record low.

The San Diego-based company said it also will cut jobs and seek other ways to cut costs. It also said it is seeking waivers of some financial covenants from its lenders, and is "exploring various strategic options."

Accredited's announcement, issued shortly after midnight Eastern time, is the latest blow in the subprime lending sector, which makes loans to people with poor credit histories.

Lenders have been battered by rising defaults and increasing demands by their own lenders to take back soured loans at a loss. More than two dozen have quit the industry in the last year.

Larger rival New Century Financial Corp. is widely considered by analysts to be on the brink of bankruptcy, after receiving notices of default from several lenders.

Shares of Accredited fell $5.85, or 51.3 percent, to $5.55 in morning trading on the Nasdaq, after earlier falling to $5.30. They traded as high as $60.13 last May 11.

Accredited said it has paid $190 million in margin calls on loan facilities since January 1 as lenders demand more collateral. It said it received two-thirds of those margin calls since February 15.

The company ended 2006 with $345 million of available liquidity. It didn't say how much it now has. Accredited said it may try to raise additional capital.

In addition, the company said it is unlikely to meet the extended March 16 deadline to file its annual report with the U.S. Securities and Exchange Commission.

It is still determining whether to write down some of the value of Aames Investment Corp., a Los Angeles subprime lender it bought last October 1.

Accredited in the fourth quarter posted a net loss of $37.8 million, or $1.49 per share, as revenue declined 60 percent.

[Ghost Dog]

29. Public announcement GEAB N°12 (February 16, 2007)

I believe we haven't seen this one yet in SMW?
http://www.leap2020.eu/GEAB-N-12-is-avaible!-Global-systemic-crisis-April-2007-Inflexion-point-of-the-phase-of-impact-US-economy-enters_a448.html

As anticipated last January in GEAB N°11, the « fog of statistics » is now clearing and US economic trends appear clearly (retail sales at a standstill in January 2007, record high trade deficit in 2006, downward revision of US growth for 2006, Fed's confirmation of economic slowdown, serial defaults among mortgage lending organisations, continued collapse of US housing market,...). Therefore, according to LEAP/E2020, and contingent on the specific evolution of each component of the US economy, the month of April will account for the inflexion point of the impact phase of the global systemic crisis, that is to say the moment when all negative consequences of the crisis pile up exponentially. More precisely, April will be the time when negative trends will converge, transforming many « sectorial crises » into a generalised crisis, a « very great depression », involving all economic, financial, commercial and political players.

In April 2007, nine practical consequences of the unfolding crisis will converge:

1. Acceleration of the pace and size of bankruptcies among US financial organisations: from one per week today to one per day in April
2. Spectacular rise of US home foreclosures: 10 million Americans out on the street
3. Accelerating collapse of housing prices in the US: - 25%
4. Entry into recession of the US economy in April 2007
5. Precipitous rate cut by the US Federal Reserve
6. Growing importance of China-USA trade conflicts
7. China's shift out of US dollars / Yen carry trade reversal
8. Sudden drop of US dollar value against Euro, Yuan and Yen
9. Tumble of Sterling Pound

In this February issue of the GlobalEurope Anticipation Bulletin (on subscription), LEAP/E2020 details the nature and sequence of these developments meant for all concerned players (currency or financial market operators, investors, international traders, political and economic decisions-makers or analysts) to better anticipation events. Strategy is time mastery! In the present issue of GEAB, our teams endeavoured to build a device to overcome this quarter's accelerating developments.

/...

http://www.leap2020.eu/Over-a-million-and-a-half-houses-foreclosed-and-more-than-a-hundred-mortgage-companies-bankrupt-LEAP-E2020-s_a491.html
Over a million and a half houses foreclosed and more than a hundred mortgage companies bankrupt... LEAP/E2020's anticipations confirmed by Bloomberg!
- Decoded news (March 12, 2007) -

Over a million and a half houses foreclosed and more than a hundred mortgage companies bankrupt... LEAP/E2020's anticipations confirmed by Bloomberg!
One month after LEAP/E2020 anticipated in detail the amount of forthcoming house foreclosures and mortgage company bankruptcies (GEAB N°12), Bloomberg in an article dated March 12th entitled "Foreclosures May Hit 1.5 Million as U.S. Housing Bust Deepens;, confirms the trend thus anticipated, and writes that the Federal Reserve itself expects no less than 1.5 million houses foreclosed and 100 sub-prime morgage companies bankrupt in 2007. Knowing that this category of media and institution are usually prone to underestimate negative trends, LEAP/E2020 advises to expect even higher figures.

/...

(See also...)

[Ghost Dog]

30. Greenspan is wrong: recession risk rises to 50%

https://www.koreaherald.co.kr/SITE/data/html_dir/2007/03/13/200703130051.asp

Alan Greenspan, who jolted investors by predicting a one-in-three chance of a recession this year, is not as bearish as the bond market, where the risk of a downturn is even money.

The probability the U.S. economy will shrink for two quarters has risen to 50 percent, according to a model created when Greenspan ran the Board of Governors of the Federal Reserve System. The formula is based on differences in yields on Treasuries.

The economy has gone into recession six of the seven times since 1960 that short-term interest rates topped longer-term bond yields, as they do now. The difference between three-month bills and benchmark 10-year notes is close to the widest since 2001. Investors say the so-called inverted yield curve is a sign the Fed will cut borrowing costs because the economy is decelerating.

/...

[JNelson6563]

33. Does coming Gonzales presser play into markets?

I wasn't watching but I gotta wonder if the slide was hastened at all with the announcement Gonzales was going to talk to the press.

Julie

[ozymandius]

40. I dunno. I never considered the piehole effect could apply to anyone but Bush.

:shrug:

[JNelson6563]

47. I believe all Team Bush members are eligible

Part of the Power Package they sell their souls for. ;-)

Glad to see the Marketeers survived this bloody day. :hi:

See ya tomorrow!

Julie

[Ghost Dog]

34. Unwinding the Yen, Unravels Global Stock Markets

http://www.safehaven.com/article-7132.htm

<long snip...>

With MoF warlords putting a floor under the Nikkei-225 at 16,600, the US Plunge Protection Team (PPT) went into action on March 5 and 6th. Just 12-hours earlier, the share price of Goldman Sachs had plummeted by $5.75 to $190 per share, off 14.7% from its record highs set on Feb 22nd. Shares of New Century Financial NEW.N, the second-largest US home lender in the sub-prime market had plunged 70% the previous day, after some lenders refused to let it tap credit lines. Goldman Sachs is one of New Century's lenders, along with Morgan Stanley and Citigroup.

Suddenly, the masters of the universe, with their slick and sophisticated Ponzi schemes requiring ever-larger infusions of cheap money were caught off guard. Bear Stearns, Goldman Sachs, Lehman Bros, Merrill Lynch and Morgan Stanley, which earned a record $24.5 billion in 2006, are exposed to sub-prime junk bonds, equaling 10% to 15% of their firm's capital. Prices for credit-default swaps linked to their bonds traded at levels that equated to debt ratings of Baa2.



Speaking from Tokyo on March 5th, with the Dow Jones Industrials (DJI) teetering on the brink of the psychological 12,000 level and Goldman Sachs stock in need of some oxygen, PPT chief commander, Henry Paulson issued a buy signal, "Some of the credit issues are there, but they're largely contained. The global economy is more than sound. It's as strong in the last couple of years as I've seen in a lifetime. All the economies are growing, inflation is low, and liquidity is high," Paulson declared. His comments triggered a powerful 160-point DJI rally by day's end.

On Feb 27th, White House spokesman Tony Fratto said President Bush got a briefing over the phone from Paulson concerning the 416-point plunge in the DJI. "The president's economic advisers are keeping an eye on the markets. We believe that the economic fundamentals in the US economy are sound," said Fratto, borrowing the script from Tokyo's Ministry of Finance.

Treasury spokeswoman Brooklyn McLaughlin said the President's Working Group of Financial Markets (Plunge Protection Team) was monitoring the markets. "The president's working group regularly monitors markets and will continue to do so," McLaughlin said. The high-level group is made up of the Federal Reserve chairman, Treasury secretary, chairman of the Securities and Exchange Commission and chairman of the Commodity Futures Trading Commission.

It's very interesting to note that the Dow Jones Industrial futures market gapped 80-points higher after Paulson's "don't worry, be happy" comments in Tokyo, during the first 15-minutes of Asian trading on March 6th, putting a nasty squeeze on short sellers.



On the previous day, March 5th, a large buyer entered the market to catch a falling knife, and lifted the DJI futures 140-points off their intra-day low within the second hour of Asian trading, when market conditions are usually thin.

By week's end, Goldman Sachs shares had recovered to $201 /sh.



Is there Intervention in the Stock Index futures markets?

Did Japan's finance ministry and the US Treasury intervene in the stock index futures markets, to prevent panic free-falls, and engineer short squeeze rallies? Only their floor brokers know for sure. But intervention also includes jawboning, painting rosy scenarios, downplaying bad economic news and sub-prime mortgage defaults, and pushing money into the hands of securities dealers through coupon passes.

The US Plunge Protection Team (PPT) gave frazzled US investors a chance to catch their breath as the Dow Jones Industrials rebounded 226 points last week, after a 736-point plunge from its Feb 20th record high. But it has been almost four years since the Dow Industrials or the Standard & Poor's 500 fell 10% from a high, which is an exceptionally long period without such a pullback. Not even Tokyo's financial warlords have been able to put together such as winning streak!

/...

[Buttercup McToots]

35. Ouch!!

That smarts...
180 down...

[ozymandius]

38. The Witching Hour cometh (with a vengeance).

3:12
Dow 12,108.65 Down 209.97 (1.70%)
Nasdaq 2,358.85 Down 43.44 (1.81%)
S&P 500 1,381.79 Down 24.81 (1.76%)
10-Yr Bond 4.50% Down 0.053
NYSE Volume 2,824,815,000
Nasdaq Volume 1,718,339,000

[ozymandius]

43. last check before closing

3:37
Dow 12,113.94 Down 204.68 (1.66%)
Nasdaq 2,359.86 Down 42.43 (1.77%)
S&P 500 1,382.30 Down 24.30 (1.73%)
10-Yr Bond 4.4950% Down 0.0580
NYSE Volume 3,097,766,000
Nasdaq Volume 1,882,941,000

...money looking for safety...

3:30 pm : Recent recovery efforts were very short-lived as a renewed wave of selling interest going into the close push the major averages to fresh session lows and force the NYSE to institute downside trading curbs. Further deterioration in market breadth is echoing the sense of anxiety on the part of buyers as decliners now hold a more than 4-to-1 edge over advancers on both the NYSE and the NYSE.

All three indices plunging roughly in synch with each other and logging roughly the same percentage declines (-1.7%) suggests that program trading is behind today’s broad-based move to the downsideDJ30 -210.09 NASDAQ -41.57 SP500 -24.00 NASDAQ Dec/Adv/Vol 2488/559/1.76 bln NYSE Dec/Adv/Vol 2694/608/1.49 bln

[Ghost Dog]

44. Brazilian Stocks Fall on Growth Concerns: World's Biggest Mover

http://www.bloomberg.com/apps/news?pid=20601084&sid=aqrOOsCn8gN0&refer=stocks

March 13 (Bloomberg) -- Brazilian stocks fell, leading the slide as Latin stocks dropped for the first day in four, after a retail sales report reignited concern the U.S. economy may be slowing, curbing demand for the region's exports.

Brazil's Bovespa index fell 1366.26, or 3.1 percent, to 42,882/87 at 3:05 p.m. New York time, the biggest move among markets included in global benchmarks. The decline was led by Cia. Vale do Rio Doce, the world's largest iron ore producer. Argentina's Merval fell 2.7 percent, the second biggest move among global benchmarks, led by steelmaker Tenaris SA.

...

Mexican shares also fell on concern that growth in the U.S., which buys 80 percent of exports, is stalling.

...

In other Latin American markets, the main indexes in Peru and Venezuela rose while those in Chile and Colombia fell. as the Morgan Stanley Capital International index of Latin American shares fell 67.32 points, or 2.2 percent, to 2,947.39 as of 2:10 p.m. New York time.

/...

[Ghost Dog]

45. Toronto Stock markets turn sharply lower

http://money.canoe.ca/News/Economy/2006/07/11/2040460-cp.html
...

Toronto's S&P/TSX composite index tumbled 203.78 points to 12,861.37 as last week's rally ran out of steam.

All sectors were negative, with losses led by the financial, mining and industrial sectors.

The Canadian dollar declined 0.31 of a cent to 85.15 cents US while the TSX Venture Exchange was down 87.9 points to 3,047.18.

/...

[UpInArms]

48. nasty closing numbers and yada

Dow 12,075.96 242.66 (1.97%)
Nasdaq 2,350.57 51.72 (2.15%)
S&P 500 1,377.95 28.65 (2.04%)
10-Yr Bond 4.495% 0.058

NYSE Volume 3,485,548,000
Nasdaq Volume 2,268,766,000

4:20 pm : Stocks tumbled Tuesday as an overly pessimistic market exaggerated everything from the implications of an unwinding in the yen carry trade to potential defaults by subprime lenders spilling over into an economy that again showed signs of slowing.

Before the bell, February retail sales rose just 0.1% (consensus 0.3%) while the more closely-watched sales, ex-autos, unexpectedly fell 0.1% (consensus 0.3%). Both figures pressured a market already extremely sensitive to signs of potential economic weakness even though unseasonably cold weather was a likely cause for the soft report. It is also worth noting that the data won't alter expectations of about 2% real GDP growth in Q1.

However, with subprime mortgage worries acting as an overhang for weeks now, more negative developments in the space took a weak stock market and made it even weaker as sellers found another excuse to take some money off the table following three straight days of gains for the Dow and S&P 500.

Accredited Home Lenders (LEND 3.97 -7.43) was the latest company in the subprime lineup to warn of such difficulties, saying it needs to raise new funds to cover the risk of default. The stock lost nearly 70% of its value. Adding insult to injury was Countrywide Financial's (CFC 33.49 -1.65) CEO saying on CNBC that the subprime issue is becoming a "liquidity crisis."

But the straw that broke the backs of the bulls today was a report midday from the Mortgage Bankers Association which showed delinquencies among subprime borrowers hit 13.3% in the fourth quarter. That was the highest rate in more than four years and overshadowed a blowout Q1 earnings report from Goldman Sachs (GS 199.03 -3.57) that discounted the overall impact of something we believe isn't going to have a material impact on the economy.

Nonetheless, the damage was done as a 3.2% sell-off in the most influential of all S&P sectors -- Financials -- pulled the rug out from under a market and left buyers sidelined into the close. The Dow, S&P 500 and Nasdaq plunged 2.1% on average, forcing the NYSE to institute downside trading curbs. Of the 147 S&P industry groups, 146 posted losses.

Further underscoring the widespread bearish tone were huge gains of 30% and 19% on the VIX (CBOE Volatility Index) and the VXN (CBOE Nasdaq Volatility Index), respectively. Both "investor fear gauges" closing near session highs, suggesting investors were actively buying put protection, heightened the anxiety that has been priced into stocks ever since the "Shanghai Surprise" rattled global equity markets two weeks ago today. BTK -1.3% DJ30 -242.66 DJTA -2.7% DJUA -1.5% DOT -2.2% NASDAQ -51.72 NQ100 -1.9% R2K -2.5% SOX -1.7% SP400 -2.0% SP500 -28.65 XOI -1.3% NASDAQ Dec/Adv/Vol 2542/553/2.15 bln NYSE Dec/Adv/Vol 2753/587/1.93 bln

3:30 pm : Recent recovery efforts were very short-lived as a renewed wave of selling interest going into the close push the major averages to fresh session lows and force the NYSE to institute downside trading curbs. Further deterioration in market breadth is echoing the sense of anxiety on the part of buyers as decliners now hold a more than 4-to-1 edge over advancers on both the NYSE and the NYSE.

All three indices plunging roughly in synch with each other and logging roughly the same percentage declines (-1.7%) suggests that program trading is behind today’s broad-based move to the downsideDJ30 -210.09 NASDAQ -41.57 SP500 -24.00 NASDAQ Dec/Adv/Vol 2488/559/1.76 bln NYSE Dec/Adv/Vol 2694/608/1.49 bln

3:00 pm : The indices are bouncing off session lows but not nearly enough to make a significant change in the standings. Stocks are still noticeably weak across the board, led by a 2.6% drubbing in the Financials sector. With a more than 22% weighting on the S&P 500, the absence of its leadership is very noteworthy.

Problems in the subprime mortgage market continue to weigh heavily on overall sentiment. More than 90% of the S&P 500 trading lower suggest investors limping into the final hour of trading will be hard pressed to see much more in the way of a recovery. DJ30 -175.45 NASDAQ -38.77 SP500 -21.46 NASDAQ Dec/Adv/Vol 2448/563/1.59 bln NYSE Dec/Adv/Vol 2674/623/1.33 bln

2:30 pm : Selling remains the name of the game as all 10 sectors are now negative. While crude oil turning negative within the last 30 minutes and now at session lows (-1.6%) below $58/bbl is a net positive for consumers, oil's recent plunge is also removing what little support the market was getting from Energy earlier. The sector is now down nearly 1%.

As an aside, Dow component General Motors (GM 30.27 -1.05) is now down 3.4% after saying GMAC's severely depressed nonprime portfolio will constrain overall results exacerbates underlying concerns about subprime mortgage misfortunes spilling over into the broader economy. DJ30 -192.75 NASDAQ -44.04 SP500 -23.46 NASDAQ Dec/Adv/Vol 2434/555/1.44 bln NYSE Dec/Adv/Vol 2640/630/1.18 bln

[Roland99]

50. "an overly pessimistic market exaggerated everything "

Who the hell wrote that?? Rove?