STOCK MARKET WATCH, Monday February 9

[ozymandius]

Source: du

STOCK MARKET WATCH, Monday February 9, 2009

Bush Administration Officials Under Indictment = 0
Financial Sector Officials Under Indictment = 0
Financial Sector Officials In Prison = 1

AT THE CLOSING BELL ON February 6, 2009

Dow... 8,280.59 +217.52 (+2.63%)
Nasdaq... 1,591.71 +45.47 (+2.94%)
S&P 500... 868.60 +22.75 (+2.69%)
Gold future... 914.30 +0.10 (+0.01%)
30-Year Bond 3.68% +0.05 (+1.35%)
10-Yr Bond... 2.98% +0.08 (+2.80%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie and Silver

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Handy Links

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Read more: du

[ozymandius]

1. Market WrapUp BY TIM W. WOOD

A Brief Update on Dow Theory
and the Current Non-Confirmation

yammer yammer yammer

[ozymandius]

2. no goobermental reports today

[UpInArms]

19. last report from Friday (that I couldn't find on Friday) Consumer Credit dropped $6.6 Billion

looked all over for this on Friday afternoon, but couldn't find a thing! :shrug: So here 'tis now:

Consumer credit falls more than expected in Dec.

http://news.yahoo.com/s/ap/20090207/ap_on_bi_go_ec_fi/consumer_credit

WASHINGTON – Consumer borrowing fell for a third straight month in December, the longest stretch in 17 years, as households cut spending amid a steep recession and rising job layoffs.

The Federal Reserve said Friday that consumer borrowing dropped at an annual rate of 3.1 percent in December. The $6.6 billion decline was nearly double what analysts expected. It followed an $11 billion drop in November that was the biggest monthly plunge on records going back to 1943.

The weakness in December reflected a big 7.8 percent decline in the category that includes credit card debt, and a 0.2 percent drop in the category that includes auto loans.

The cutback in consumer spending, which accounts for about 70 percent of economic activity, is the major reason the overall economy, as measured by the gross domestic product, contracted at an annual rate of 3.8 percent in the final three months of last year. That was the biggest drop in the GDP since 1982.

Consumers are retrenching in the face of soaring job layoffs. The Labor Department said Friday that employers slashed a net total of 598,000 jobs in January, the most since 1974, as the unemployment rate shot up to 7.6 percent. Both figures were worse than analysts expected.

Consumer spending fell in both the third and fourth quarters last year, the first back-to-back declines since the 1990-91 recession.

The three straight months of declines in consumer borrowing was the longest stretch of weakness since a seven-month plunge that ended in December 1991.

...more...

[Festivito]

3. Debt: 02/05/2009 10,717,998,123,287.70 (UP 48,805,814,725.25) (Big, 46B$.)

(This could be the start of something big -- AND GOOD FOR US.)

= Held by the Public + Intragovernmental(FICA)
= 6,410,020,405,165.47 + 4,307,977,718,122.23
UP 46,668,131,793.54 + UP 2,137,682,931.71

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.81, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 305,745,686 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $35,055.27.
A family of three owes $105,165.82. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 3,586,350,538.29.
The average for the last 30 days would be 2,749,535,412.69.
The average for the last 31 days would be 2,660,840,721.95.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 12 reports in 16 days of Obama's part of FY2009 averaging -0.06B$ per report, 0.04B$/day so far.
There were 87 reports in 128 days of FY2009 averaging 7.97B$ per report, 5.42B$/day.

PROJECTION:
There are 1,445 days remaining in this Obama 1st term.
By that time the debt could be between 12.7 and 18.5T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
02/05/2009 10,717,998,123,287.70 BHO (UP 91,121,074,374.62 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 693,273,226,375.30 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
01/15/2009 +020,470,437,698.93 ------------**********
01/16/2009 -000,579,761,204.80 ---
01/20/2009 -001,254,116,733.01 -- Tue
01/21/2009 -000,225,946,840.81 ---
01/22/2009 -010,383,446,466.83 -
01/23/2009 -000,119,553,441.75 ---
01/26/2009 -001,004,948,620.76 -- Mon
01/27/2009 +000,188,054,837.85 ------------********
01/28/2009 -000,240,130,414.24 ---
01/29/2009 +014,335,901,611.96 ------------**********
01/30/2009 +007,363,512,286.86 ------------*********
02/02/2009 +046,334,807,167.90 ------------********** Mon
02/03/2009 -000,138,225,404.41 ---
02/04/2009 -000,068,491,025.50 ----
02/05/2009 +046,668,131,793.54 ------------**********

121,346,225,244.93 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,053,366,320,028.63 in last 140 days.
That's 1,053B$ in 140 days.
More than any year ever, including last year, and it's 104% of that highest year ever only in 140 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 140 DAYS NOT 365.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3726176&mesg_id=3726195

[Festivito]

48. Debt: 02/06/2009 10,717,280,371,345.89 (DOWN 717,751,941.81) (Tiny.)

(Yesterday was big, today, not so much. In fact, downright tiny.)

= Held by the Public + Intragovernmental(FICA)
= 6,410,361,244,733.45 + 4,306,919,126,612.44
UP 340,839,567.98 + DOWN 1,058,591,509.79

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.27 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.81, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 305,751,858 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $35,052.22.
A family of three owes $105,156.65. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 31 days.
The average for the last 23 reports is 3,428,461,958.78.
The average for the last 30 days would be 2,628,487,501.73.
The average for the last 31 days would be 2,543,697,582.32.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 13 reports in 17 days of Obama's part of FY2009 averaging -0.16B$ per report, -0.01B$/day so far.
There were 88 reports in 129 days of FY2009 averaging 7.87B$ per report, 5.37B$/day.

PROJECTION:
There are 1,444 days remaining in this Obama 1st term.
By that time the debt could be between 12.7 and 18.5T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
02/06/2009 10,717,280,371,345.89 BHO (UP 90,403,322,432.81 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 692,555,474,433.40 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
01/16/2009 -000,579,761,204.80 ---
01/20/2009 -001,254,116,733.01 -- Tue
01/21/2009 -000,225,946,840.81 ---
01/22/2009 -010,383,446,466.83 -
01/23/2009 -000,119,553,441.75 ---
01/26/2009 -001,004,948,620.76 -- Mon
01/27/2009 +000,188,054,837.85 ------------********
01/28/2009 -000,240,130,414.24 ---
01/29/2009 +014,335,901,611.96 ------------**********
01/30/2009 +007,363,512,286.86 ------------*********
02/02/2009 +046,334,807,167.90 ------------********** Mon
02/03/2009 -000,138,225,404.41 ---
02/04/2009 -000,068,491,025.50 ----
02/05/2009 +046,668,131,793.54 ------------**********
02/06/2009 +000,340,839,567.98 ------------********

101,216,627,113.98 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,052,648,568,086.82 in last 141 days.
That's 1,053B$ in 141 days.
More than any year ever, including last year, and it's 103% of that highest year ever only in 141 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 141 DAYS NOT 365.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3729884&mesg_id=3729891

[ozymandius]

4. Oil near $40 as stimulus, bank plans loom

LONDON – Oil prices hovered near $40 a barrel Monday as investors weighed hopes for a massive stimulus package and a bank rescue plan in the U.S. this week against soaring unemployment and falling demand for crude.

Light, sweet crude for March delivery fell 13 cents to $40.04 a barrel by midmorning in Europe on the New York Mercantile Exchange.

The contract fell $1.00 on Friday to $40.17 a barrel after the Labor Department said the U.S. lost 598,000 jobs in January and the unemployment rate rose to 7.6 percent, the highest since 1992.

....

In other Nymex trading, gasoline futures were unchanged at $1.25 a gallon. Heating oil fell 0.30 cent to $1.36 a gallon, while natural gas for March delivery dropped 8.6 cents to $4.69 per 1,000 cubic feet.

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

[ozymandius]

5. Nissan to slash 20,000 jobs and sees annual loss

TOKYO – Nissan is slashing 20,000 jobs, or 8.5 percent of its global work force, to cope with what Japan's third-largest automaker expects will be its first annual loss in nine years.

"The global auto industry is in turmoil, and Nissan is no exception," Chief Executive Carlos Ghosn told reporters Monday in Tokyo.

Nissan Motor Co. now expects a 265 billion yen ($2.9 billion) net loss for the fiscal year through March — joining a raft of other Japanese corporate giants, including Toyota, Toshiba and Sony, in slashing jobs and projecting annual losses.

.....

As a key step in weathering the downturn, Ghosn said Nissan's global work force will be reduced by 20,000 through March 2010, to 215,000. Of the job cuts, 12,000 will be in Japan, including group companies, and the rest will be overseas, it said. The company did not give a further regional breakdown.

http://news.yahoo.com/s/ap/20090209/ap_on_bi_ge/as_japan_earns_nissan

[Dr.Phool]

6. Fifth Third and Huntington banks face uncertain future

Fifth Third and Huntington banks face uncertain future
Posted by Teresa Dixon Murray/Plain Dealer Reporter February 09, 2009 00:00AM

Six weeks after Ohio's largest bank was sold, the state's third- and fourth-largest banks could be heading for trouble, too.

"Ohio had four major corporate headquarters banks last year," said banking analyst Gerard Cassidy of RBC Capital Markets in Portland, Maine. "When the dust finally settles, there's a good chance there could be one or none."

Until this year Ohio was home to four of the nation's 25 largest banks: National City, KeyCorp, Fifth Third Bank and Huntington National Bank.

National City is gone, its risky lending resulting in a bargain-basement sale to PNC Financial Services Group. Though Key has had some problems, it appears stable for now.

(snip)

These days are particularly nervous for Huntington and Fifth Third, which saw their stock prices free-fall in the past month after so many investors lost confidence about whether the banks can recover.

Fifth Third has lost money three straight quarters and until last year was one of the 15 largest originators of Alt-A loans. Alt-A generally refers to loans made to people who didn't document their income.

Huntington, meanwhile, lost nearly a half-billion dollars last quarter, replaced its top executive, virtually eliminated its dividend and still has the subprime mess it inherited when it bought SkyBank in 2007.

(more)

http://blog.cleveland.com/business/2009/02/fifth_third_and_huntington_ban.html

[DemReadingDU]

27. I'm worried about 5th3rd

The stock has been in free-fall. It's scary. I have not heard any rumors of them being merged into another bank. Last year when National City was having problems, it was rumored that either 5th3rd or Key would purchase NCC. Eventually, PNC bought NCC. Could PNC buy 5th3rd, or Key, or Huntington? Maybe the FDIC will take them over? I wish they would hurry and decide sooner rather than later.

[Dr.Phool]

32. I doubt PNC will be buying anyone else.

I've read that their balance sheet is in pretty bad shape after the NCC buyout.

[FarCenter]

33. Huntington would be a logical fit for Chase

Chase has a huge operation in Columbus, and they could achieve a lot of savings by eliminating overlap.

If Chase's balance sheet could sustain this.

[Dr.Phool]

34. And Chase took over Huntingtons credit cards a few years ago.

[ozymandius]

7. World markets mixed as US stimulus rally fades

HONG KONG – World stock markets were mixed Monday, with Tokyo's index down more than 1 percent, as a recent rally over the $827 billion plan to resuscitate the U.S. economy began to fade.

Stocks have advanced strongly lately on expectations the U.S. measures, expected to pass the Senate Tuesday, will reverse the country's deepest recession in decades by stemming massive job losses and increasing spending.

....

Japan's Nikkei 225 stock average fell 107.59, or 1.3 percent, to 7969.03, while South Korea's Kospi was off 0.6 percent at 1,202.69. Singapore and New Zealand stock markets also lost ground.

In Hong Kong, the Hang Seng rose 0.8 percent to 13,769.06 in a volatile session that saw the benchmark turn negative. Boosting Hong Kong was trade in China, where the Shanghai index extended its recent gains by 2 percent.

Stock measures in Australia, Taiwan and India were higher as well.

As trading started in Europe, France's CAC 40 was off 0.5 percent, Germany's DAX slipped 0.3 percent and Britain's FTSE 100 was down 0.6 percent.

http://news.yahoo.com/s/ap/20090209/ap_on_bi_ge/world_markets

[ozymandius]

10. Wall Street anxious for passage of stimulus

NEW YORK – The coming week on Wall Street will be largely shaped by events in Washington, with investors anticipating the passage of an economic stimulus bill while awaiting more details on how the Obama administration plans to save the nation's ailing financial system.

Many analysts are expecting the government's moves to give the market a boost but warn that the euphoria could be short-lived, in keeping with a recent pattern where the reality of the economy's woes overshadows early optimism over government initiatives.

....

The Senate is expected to pass an $827 billion stimulus bill on Tuesday. The administration, however, still faces difficulties reconciling the Senate bill with the House's $819 billion version that passed earlier. President Barack Obama is pressing to have the stimulus measure — designed to pull the economy out of the longest recession in decades — on his desk for signing by mid-month.

....

Many investors are hoping the government will relax accounting rules requiring businesses to assign a value to all of their assets each quarter. Critics have argued that so-called "mark-to-market" rules have hampered banks amid the deepening financial crisis, mandating that they take unnecessary writedowns that don't reflect the true value of soured mortgage-related assets and the prices they may garner in the future.

According to a report in The Wall Street Journal on Sunday, Geithner is also considering partnering with the private sector to help banks rid themselves of their toxic assets. The idea is to have private firms buy mortgage-backed securities and other assets, allowing prices to be set by the market instead of the government, the report said, citing unnamed sources familiar with the matter.

http://news.yahoo.com/s/ap/20090208/ap_on_bi_st_ma_re/wall_street_week_ahead_1

---

Bad! Bad! Bad! I thought these people had reviewed their basic Economics textbooks about mark-to-market accounting: how suspending it is a one-way trip to La-La Land's accounting standards.

Edit: I also hate how this article was written. The report stating that "many investors are hoping" for suspension of mark-to-market rules implies there is a majority clamoring for this nonsense.

[Ghost Dog]

18. I see it. Accounting Rules.

For example, this old clapped-out VW Beetle from the early '60's that's rusting away here, hasn't moved in many years. Why, all it needs is a new motor, some work on the floor-pan and chassis, wheels, brakes, etc. Maybe some new electrics and a new paint-job (although you can still faintly see the cutting-edge flower-power design). Come, say, 2020 this vehicle will be an irresistible collector's item, that at auction could easily be worth a million dollars by then (especially due to my inside-track contacts at the Smithsonian). Who cares whether there'll be any affordable fuel for it by then... So, I think I'll just mark it up on my books to that value right now. And use it as collateral for a loan.

Now, as for that ca. 1980 Sirius 1 desktop computer with the variable-speed 5.5" floppy drive, so musical while compiling UCSD P-system programs - another fortune there, easy. Let's get the creative accountant on the job. Humm, hang on, when do I, do I, have to pay tax on my new-found wealth? Easy, transfer title to the offshore shell, and talk to my pet lobbyist on K Street.

[Tansy_Gold]

20. What really is "the true value" of these mortgage "related" assets?

The "the market" says it's zero, what else can they do? Are they asking "the government" to set a price on them, a price that looks "profitable" even though no one wants to buy them? Is that kinda like saying to a total stranger -- a taxpayer -- buy me something? I want it but I don't want to pay anything for it so YOU buy it for me?

I'm confused.


Or maybe I'm




Tansy Gold

[ozymandius]

28. I'm sure the banks lament Paulson's passing.

The Treasury overpaid for banks' junk assets. Now that time has revealed this "oversight" - I'll wager that our fair banks will miss Paulson and his wrecking crew for their use of "dumb public money" to float their excesses.

Tansy, in the world of logic, this scheme, to me, is a "trick bag" perpetrated by the big banks, through their surrogates in government. There is no favorable outcome for the one who puts money under these non-performing assets. These assets do not perform for a simple reason: they're worthless junk.

[spotbird]

29. Someone needs to tell Geithner,

and quick, that the economic collapse isn't about subprime mortgages. I know he is new on the job, but he needs to get in the loop fairly soon.

[ozymandius]

8. Half of Chinese toy makers wiped out in crisis: report

BEIJING (AFP) – Nearly half of China's toy makers closed last year due to shrinking exports brought about by the global financial crisis, Chinese media reported Monday.

At the start of 2008, China had 8,610 companies that produced and exported toys, but by the end of the year, that number had declined by 49 percent to 4,388, the Beijing Times said, citing customs data.

....

China's southern province of Guangdong, which produces roughly half of the world's toys, has seen some large-scale factory closures.

Smart Union, a Hong Kong-listed maker of products for US giants Mattel and Disney, shut down in October last year, causing 7,000 people to lose their jobs.

http://news.yahoo.com/s/afp/20090209/bs_afp/financeeconomychinatradetoys_20090209082023

[ozymandius]

9. NYSE Euronext Q4 profit down 20 percent, shares drop

LONDON (Reuters) – Fourth-quarter net profit at NYSE Euronext (NYX.PA)(NYX.N) dropped 20 percent as rivals forced the transatlantic exchange operator to cut prices and the strengthening euro further dented its business.

The bourse operator's shares were down 5.7 percent after it reported a 13 cents decrease in earnings per share (EPS) for the three months ending December 2008.

The period was marked by "unprecedented market dislocation and uncertainty," Chief Executive Duncan Niederauer said in a statement and the group had decided to halt a share buy-back program, to preserve capital.

....

During the reporting quarter, net profit was $137 million, or 52 cents per share, down from $173 million, or 65 cents per share in the year-ago period. Revenue grew to $1.2 billion compared to $974 million in the fourth quarter last year.

....

In November, NYSE Euronext announced a new pricing model, the Designated Market Maker, aimed to attract liquidity, but it adjusted the model, effective March 1 2009, after the model led to negative spreads at the stock exchange operator.

http://news.yahoo.com/s/nm/20090209/bs_nm/us_nyseeuronext

[radfringe]

11. Unemployment benefits safety net is fraying

Unemployment benefits safety net is fraying
As payments dry up, almost half of 11.6 million jobless don’t receive help
http://www.msnbc.msn.com/id/29084715/
Sun., Feb. 8, 2009

The government safety net designed to protect laid-off workers from financial catastrophe is falling short, leaving nearly half the 11.6 million jobless Americans without unemployment benefits.

The shortcomings are fueling the recession as an increasing number of workers fall through the cracks and curtail spending. The trend highlights what economists say is a growing need for a 21st century makeover of a program started in the depths of the Great Depression.

Among the key problem areas:

-- There are many more part-time workers now than in 1935, but the program only covers those looking for full-time work.

-- Many eligible jobless Americans are shut out because states use an outdated system for calculating their income, making it more difficult to meet requirements.

-- Unemployment spells increasingly last longer than the usual 26-week jobless benefits program.

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

few thoughts regarding unemployment:

1. If the repubs are serious about "cutting taxes", how about eliminating Reagan's tax on unemployment?

2. Currently, unemployment is funded through employers only. People collecting unemployment typically receive approx 60% of their former pay. Looking to the future - what if employees also paid into the fund? 1% of gross? and that would translate to a higher unemployment check 75% of former gross pay (which would approximately be equal to net take-home pay)

3. the other problem with being unemployed is HEALTHCARE - yeah, there's "cobra" - however the cobra payments are usually unaffordable for people collecting unemployment. Let them sign up for medicaide until we get a universal healthcare program going...

[ozymandius]

16. All excellent suggestions.

We are way past due for a full reckoning surveying the damage the Reagan administration perpetrated against the working class. In subtle ways - that era in American politics did more damage to the nation's labor force in terms of organization, wage growth, real earnings and rights that under any other with the possible exception of the Bush administration. I feel it can be argued that the Bush administration simply exploited the weaknesses left from Reagan's rampage.

[ozymandius]

12. Treasury delays bank bailout announcement

WASHINGTON (Reuters) – The Obama administration pushed back the announcement of a keenly awaited bank rescue plan until Tuesday as it pressed lawmakers to settle their differences over a huge economic stimulus package.

Treasury Secretary Timothy Geithner will outline the bailout plan in a speech at 11 a.m. EST (1600 GMT) on Tuesday, the Treasury Department said.

The announcement of the bank rescue plan -- which will seek to shore up some of the biggest commercial banks in the United States -- had been due on Monday.

But the Senate is now expected to be focused on that day on the massive economic stimulus package ahead of a vote on Tuesday.

.....

Obama's team is now turning its efforts to cleaning up the toxic assets clogging the financial system and it is expected to propose a range of measures, including further state acquisitions of stakes in banks, buying up some toxic assets and guaranteeing banks for losses on others.

.....

He pointed to a similar approach already adopted by the Federal Reserve, which has announced plans to buy mortgage-backed securities, resulting in dropping mortgage rates.

http://news.yahoo.com/s/nm/20090209/bs_nm/us_financial_bailout

---

My head hurts over this news. Not one more penny needs to go to these banks without outright taxpayer ownership of them. When banks seek to profit off the taxpayer's money then the taxpayer deserves a prime cut from the carcass - not some toxic scrap with hope of La-La Land valuation.

[Demeter]

21. Cutbacks in the Fiscal Boost Program

http://delong.typepad.com/sdj/2009/02/cutbanks-in-the-fiscal-boost-program.html

The stimulus package is too small--and it looks like almost all of the cuts are from reasonable uses of government funds that are substantially labor intensive and thus are the right kind of thing to be in the stimulus package. It looks like the cuts are:

* $40 billion for state fiscal stabilization (includes $7.5 billion of state incentive grants)
* $16 billion for school construction
* $5.8 billion for Health Prevention Activity
* $4.5 billion for GSA
* $3.5 billion for higher education construction
* $3.5 billion for energy-efficient federal buildings (original bill $7 billion)
* $2.25 billion for Neighborhood Stabilization
* $2 billion for HIT Grants
* $2 billion for broadband
* $1.25 billion for project based rental
* $1.2 billion for retrofitting Project 8 housing
* $1 billion for Energy Loan Guarantees
* $1 billion for Head Start/Early Start
* $600 million for Title I (NCLB)
* $300 million from federal fleet of hybrid vehicles (original bill $600 million)
* $300 million for federal prisons
* $300 million for BYRNE Formula
* $200 million from Environmental Protection Agency Superfund (original bill $800 million)
* $200 million for National Science Foundation
* $200 million TSA
* $165 million for Forest Service capital improvement
* $140 million for BYRNE Competitive
* $122 million for new Coast Guard polar icebreaker/cutters
* $100 million for Farm Service Agency modernization
* $100 million from National Oceanic and Atmospheric Administration (original bill $427 million)
* $100 million from law enforcement wireless (original bill $200 million)
* $100 million from FBI construction (original bill $400 million)
* $100 million for distance learning
* $100 million for NIST
* $100 million for science
* $98 million for school nutrition
* $90 million for State and Private Wildlife Fire Management
* $89 million GSA operations
* $75 million from Smithsonian (original bill $150 million)
* $65 million for watershed rehabilitation
* $55 million for historic preservation
* $55 million for historic preservation
* $50 million for aquaculture
* $50 million for CSERES research
* $50 million for detention trustee
* $50 million for NASA
* $50 million for aeronautics
* $50 million for exploration
* $50 million for Cross Agency Support
* $50 million from DHS
* $30 million for SD salaries
* $25 million for Marshalls Construction
* $25 million for Fish and Wildlife
* $20 million for working capital fund
* $10 million state and local law enforcement

What were Ben Nelson and Susan Collins thinking? It is a mystery.

[tclambert]

62. I like the way you re-sorted the list,

with the mostest firstest.

[Demeter]

66. Not My Doing--It Came That Way!

I don't even have time to sort socks!

[ozymandius]

13. Central Banks Sacrifice Independence as Crisis Trumps Rate Cuts

Feb. 9 (Bloomberg) -- The global financial crisis is forcing the world’s central bankers to surrender some of their prized independence. Regaining it won’t be easy.

More than a principle is at stake. For longer than a quarter-century, independent central banks have been able to take painful and politically unpopular measures needed to restrain inflation. But the worst economic calamity since the 1930s has left Ben S. Bernanke, Mervyn King, Masaaki Shirakawa and their colleagues little choice but to align their institutions’ policies with those of their nations’ elected leaders.

As a result, policy makers may find it harder to act whenever the time finally comes to begin soaking up the money with which they’ve flooded the globe.

....

While that may be necessary now, it could turn into a problem later. Some Fed policy makers have already stressed the need to move quickly, once the crisis passes, to sop up all the money they have pumped into the financial system. Critics charge that the Fed and other central banks laid the groundwork for the current turmoil by not raising rates fast enough once the 2001 recession passed.

....

In the past, the Fed has withdrawn money from the market by selling Treasury debt it holds to private investors. Those holdings have now dwindled, even as the balance sheet has ballooned, because the central bank has been swapping its Treasuries for riskier, harder-to-sell assets in an effort to revive the credit markets.

http://www.bloomberg.com/apps/news?pid=20601109&sid=a1J9feRdRMU4&refer=home

[Ghost Dog]

14. China wants IMF to be tougher with rich states

Mon Feb 9, 2009 4:30am EST BEIJING, Feb 9 (Reuters) - China, setting out its stall for the next global financial summit, wants the International Monetary Fund to get tougher with developed countries that let their economies run off the rails.

In a position paper prepared for the April 2 meeting in London of the Group of 20, China calls for more power for developing countries in the IMF and World Bank and issues a warning against investment protection.

On financial regulation, the memo says accounting standards and credit ratings should be adjusted to contain the "pro-cyclical" bias of financial institutions to ramp up lending and investment when times are good, leading to excessive risks.

The paper, seen by Reuters, also calls for hedge funds to be regulated and for excessive leverage and pay to be curbed.

Although it is the world's third-largest economy, China has kept a relatively low profile in the debate on what reforms are needed to avert a repeat of the current credit crunch, which has plunged much of the world into recession.

The bulk of the paper, which the government circulated last month to diplomats, is uncontroversial, dwelling on the need for greater information sharing and policy coordination.

But the section on the IMF touches a raw nerve because of China's belief that the Fund spends too much time lecturing developing countries on how to run their economies.

According to this line of thought, the Washington-based fund could have tempered the present crisis by sounding the alarm earlier and louder about the economic imbalances building up in rich countries, notably the United States, whose voting share gives it the power to veto the most important IMF decisions.

"The IMF should strengthen oversight over macroeconomic policies of all parties, particularly the major reserve currency economies, and provide oversight information and improvement recommendations to its members on a regular basis..." the paper says.

/... http://www.reuters.com/article/marketsNews/idINPEK17709220090209?rpc=44&sp=true

[Ghost Dog]

15. UK's Brown-IMF, World Bank are not fit for purpose

Mon Feb 9, 2009 6:34am EST LONDON, Feb 9 (Reuters) - The International Monetary Fund and the World Bank are not fit for purpose and need to change dramatically in the wake of the worst financial crisis in living memory, British Prime Minister Gordon Brown said on Monday.

Speaking at a seminar to set out the agenda for April's G20 leaders' summit in London, Brown told the assembled academics that a "bold leap forward" was now needed if future crises were to be prevented.

"I believe the IMF and World Bank will have to change their role quite dramatically," he said. "These institutions were built for a world of local capital flows, not global capital flows. The institutions we have inherited are not equipped for the tasks we have to deal with in the future."

Leaders of the G20, which includes industrialised nations like the United States and Britain as well as emerging economies like India and China, will meet in London on Apr. 2 to discuss the financial crisis that is sapping the world economy.

Brown, who is hosting, has billed the London summit -- subtitled "Stability, Growth and Jobs" -- as a new Bretton Woods after the 1944 conference of 44 nations that created the modern financial system.

"I see a big argument about how the IMF and the World Bank are to be financed in the future, one that will require us to talk about the reserves in different countries, talk about what sort of loan or bond facility we can develop, perhaps with the Arab states, perhaps even with Sovereign Wealth Funds," he said.

/... http://www.reuters.com/article/marketsNews/idINL926925320090209?rpc=44&sp=true

[UpInArms]

17. dollar watch

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

Last trade 85.350 Change -0.295 (-0.34%)

Does Dollar Dominance Continue?

http://www.bktraderfx.com/site/fx-weekly-reports/fx-weekly-0206-1309-does-dollar-dominance-continue

Will the stimulus succeed? That will be the central question driving the currency market in the next few weeks. With Senate late Friday agreeing to the $800 Billion bill its all over but the shouting for the Republicans, but for the rest of the country the economic future remains cloudy as ever.

For the past month the FX market has given the greenback a huge benefit of the doubt bidding it higher despite deteriorating economic conditions. In a complete reversal of the typical dynamic of FX trade, speculators actually punished those currencies that maintained high interest rates and rewarded the ones whose governments were most aggressive in pursuing an expansive monetary and fiscal policy. Witness the trade in EUR/GBP this week. With BoE lowering rates by 50bp while ECB held rates steady, the natural inclination would have been to sell pounds, but in reality the cross was crushed as traders ran away from euros on fears that ECB was doing too little too late.

As we noted last week it’s a global ZIRP world baby, and in an environment where rates are minuscule all over, yield loses its value. Reflation becomes the dominant trade and to that end the market believes that US economy is far more flexible and aggressive in its policy response and therefore is much more likely to rebound first.

Are the dollar optimists right? We have huge doubts. So far the policy direction from the Obama administration has been flawed to say the least. In times that call for revolutionary change he has been a technocratic incrementalist. The banking sector which is the core our economic problems screams for bankruptcy and recapitalization, but the Obama policy prescription has been to keep a terminally ill patient on life support in hopes of a miraculous recovery. Miracles however, happen only in children’s fairy tales and these are decidedly serious adult times.

So in short, no we don’t think that the stimulus will stimulate anything and at best may simply keep things from getting worse. That however, may be enough for now. As we’ve been saying for a long time, the long dollar trade is not really being fueled by optimism over the US economy, but rather by a complete lack of confidence in the EZ region.

...more...

US Dollar Could Gain If Bernanke, US Retail Sales Ignite Risk Aversion

http://www.dailyfx.com/story/currency/eur_fundamentals/US_Dollar_Could_Gain_If_1233963058969.html

The US dollar ended the past week down versus most of the major currencies as a surge in risk appetite weighed on low-yielders, including the Swiss franc and Japanese yen. For what it’s worth though, the dollar index hasn’t done much but consolidate below its January highs, and it will take a large shift in risk trends to get the greenback to break higher or lower. With event risk due to be fairly high this week, such a break seems possible.

On Tuesday, Federal Reserve Chairman Ben Bernanke is scheduled to testify in front of the House Financial Services Committee on the central bank’s lending programs at 13:00 ET, and this could prove to be one of the biggest market-movers of the week due to its potential impact on risk sentiment. Part of this will probably include explanations as to why the Federal Reserve announced on Friday that they would delay plans to start lending under a $200 billion program called the Term Asset-Backed Securities Lending Facility (TALF). TALF will allow the central bank to lend to holders of AAA rated debt backed by newly and recently originated loans, including education, car, credit-card loans, and loans guaranteed by the Small Business Administration. Overall, though, if Chairman Bernanke is bearish on prospects for the financial markets and global economy, his comments could have very negative repercussions for the stock markets, and we could see flight-to-quality spark demand for Treasuries, the US dollar, and Japanese yen. On the other hand, if he manages to inspire confidence that conditions will not get significantly worse, risky assets could rally.

On Thursday, the Commerce Department is forecasted to report that US retail sales fell negative for the seventh straight month in January, as even the most aggressive discounting wasn’t able to offset the impact of a deteriorating labor market, tighter credit conditions, and a year-long recession. More specifically, advance retail sales are anticipated to have contracted 0.8 percent during the month, and excluding auto sales are expected to have slumped 0.4 percent, initiating what may end up being a consistent trend through the first half of 2009 as well. As we saw with US non-farm payrolls, the impact of a disappointing result may be limited, as the Federal Reserve has already cut the fed funds target to a record low range of 0.0 percent - 0.25 percent and has no room to cut further.



...more...

[Ghost Dog]

23. What the zero world offers

Mon Feb 9, 2009 1:00am EST LONDON, Feb 8 (Reuters) - Investors are testing the enthusiasm of central banks to cut interest rates, with laggards in the race to zero facing heavy pressure on currencies.

Zero interest rates work to encourage investors to get out of cash, other liquid assets and safe government bonds -- where they earn zero yields -- and move up on a risk curve to buy instruments that give higher returns, such as equities or higher-quality credit notes.

Moreover, as central banks reach zero policy rates and begin to ponder more quantitative easing policies of buying shares, credit or mortgage-backed securities, investors will also be encouraged to take part in such buying, which in turn help boost risk assets in the long term.

...

The top runner in the game of reaching zero so far is the U.S. Federal Reserve, which in December cut the cost of borrowing to near zero.

Japan comes in a close second as rates are at 0.1 percent. It also pledged last week to buy up to $11 billion in shares held by banks. Britain has just cut to 1.0 percent, the lowest in the more than 300-year history of the Bank of England.

The laggard is the European Central Bank, whose cost of borrowing at 2 percent is the highest in the Group of Seven major economies. The ECB said zero interest rates were not an option for now given the drawbacks, although it did signal the bank would probably cut rates again in March.

EURO MISERY

A lower interest rate in theory makes holding a currency less attractive.

However, investors are now punishing the euro, as they bet that economic conditions will deteriorate enough to prompt the ECB to cut interest rates aggressively.

Interest rate futures now show implied UK rates in March standing 10 basis points above that of the euro zone. This compares with expectations back in December that UK implied rates would be 75 bps below the euro zone.

Sterling shot up by almost 9 percent versus the euro in the past two weeks -- scoring one of the biggest fortnightly gains since mid 1995. It hit a record low near parity <EURGBP=> in December.

The euro is the biggest loser this year, falling around 7-8 percent against the dollar <EUR=>, sterling and the yen <EURJPY=>.

...

"Our greatest focus is on opportunities in parts of the equity markets where policy support is the most direct," Goldman Sachs said in a note to clients.

Its housing basket trade -- which bets on a recovery in the housing market -- has risen 12 percent after a sell-off in January.

...

Goldman's model on an optimal real interest rate shows a Fed funds rate of minus six percent by the end of 2010. Since a negative funds rate is impossible, this means the Fed will need to make heavy use of quantitative easing over the next two years to return inflation and growth to their target levels.

A similar calculation in the euro zone suggests that the ECB will hit the zero bound by the middle of this year, while in the UK the policy rate will be negative by mid-2009, assuming no change in potential output growth.

According to corporate earnings estimates, the United States and Britain currently have largest expected falls in earnings of up to 11-12 percent, allowing investors to price that in the stock market. The forecast for euro zone earnings is still positive.

...

Seventy-nine percent of clients surveyed by Goldman Sachs expected the United States to recover before Europe, compared with 15 percent who expected a simultaneous recovery and six percent who reckoned Europe would recover before the United States.

"There is also consideration of first in, first out. The U.S. is the first to go into the recession and may be the first to go out. This is where the most overwhelming measures are taken," De Vijlder said.

/... http://www.reuters.com/article/marketsNews/idINL72629420090209?rpc=44&sp=true

Crazy. :silly:

[Demeter]

22. Al Lewis: Wake Up, Folks -- It's a New World of Pay Limits

http://www.foxbusiness.com/story/markets/industries/government/al-lewis-wake-ceos----new-world-pay-limits/

FOXBusiness

* Buzz up!
* Digg It
* StumbleUpon
* Reddit



President Obama is restricting your annual compensation to $500,000.

Here's a handy Q&A regarding this unprecedented action that you can post on one of your many Sub-Zero refrigerators. Refer to it often as you adjust to the global economic collapse that you helped cause.

Q: Where does Obama get off telling me what I can make?

A: So far, Obama's decree only applies to companies receiving "exceptional assistance" from U.S. taxpayers to keep them from melting down like those giant ice sculptures at your daughters' weddings.

Q: What constitutes "exceptional assistance?"

A: A billion here, a billion there. Unfortunately, it just doesn't take all that much.

Q: Are we a bunch of socialists, letting the president decide executive salaries?

A: Yes, thanks to you. You begged for a government bailout. You got it. This makes the government your shareholder. And you report to your shareholders in the same way your housekeepers report to you.

Q: Since when? Executive compensation goes up every year. Shareholder proposals to curb it are routinely shot down by my vast networks of powerful friends, no matter how poorly we perform.

A: It's one thing to loot the shareholders. It's another to rob the taxpayers.

Q: OK. So if we stop asking for bailouts, Obama will stop dictating pay cuts?

A: Nope. Obama says this is only the beginning: "We are going to examine the ways in which .. executive compensation contributed to a reckless culture and quarter-by-quarter mentality that .. helped to wreak havoc on our financial system."

Q: Isn't this just a populist, diversionary tactic on Obama's part so that he can spend $900 billion more on his porky projects?

A: Yes. And you of all people should envy his strategic gifts, which were finely honed right beside you at Harvard. Besides, if things get keep getting worse, you will beg Obama for another pay cut, just to hold the line on rising sales of guillotines.....


OOOH! SOMEBODY ELSE LIKES THE FRSP!

[Demeter]

25. J.P. Morgan's Abusive Excutives Bonuses

http://optionsforemployees.com/articles/article.php?id=146



As readers will recall, J.P. Morgan received the first large bail-out from the New York FED of $55 Billion, guaranteed by Bear Stearns' worthless assets, to prop up its own liquidity position and buy Bear Stearns stock.

J.P. Morgan also recently received another $25 Billion in TARP payments from the Treasury.

This article is about how J.P. Morgan's executives , instead of receiving easy to detect cash bonuses, received very large bonuses in the form of Stock Appreciation Rights (SARs) and Restricted Stock Units. These equity compensation securities are not easy to understand or value by other than experts in the field.

SARs are very similar to employee stock options and Restricted Stock Units are very similar to Restricted Stock.

These SARs were granted on January 20, 2009, the day that the J.P.Morgan stock reached its lowest in five years. The stock quickly rebounded as illustrated in the graph below. The arrow indicates the day and the price of the stock when the grant was made.

On January 22, 2008 we see a repetition of the grants of SARs with the stock hitting a low point followed by a substantial rebound in the next days.

SEEE GRAPHS AT LINK


Let's examine the size of the bonuses of the top 15 executives, at J.P. Morgan, that were granted on January, 20, 2009 and reported two days later.

See the link below:

http://www.secform4.com/insider-trading/19617.htm


Stock Appreciation Rights Granted

SARs Amounts Name of Exercise Value 2/4/09
Granted Grantee Price

700,000 Winters 19.49 $11,300,000
700,000 Black 19.49 $11,300,000
500,000 Staley 19.49 $8,100,000
300,000 Scharf 19.49 $4,890,000
250,000 Drew 19.49 $4,075,000
200,000 Miller 19.49 $3,260,000
200,000 Rauchenberger 19.49 $3,260,000
200,000 Smith 19.49 $3,260,000
200,000 Zubrow 19.49 $3,260,000
200,000 Bisignano 19.49 $3,260,000
200,000 Mandelbaum 19.49 $3,260,000
200,000 Cavanaugh 19.49 $3,260,000
200,000 Cutler 19.49 $3,260,000
200,000 Maclin 19.49 $3,260,000
100,000 Daley 19.49 $1,630,000
----------------------------------------------------------------------------------------
Total value (2/6/09) of SARs Granted = $81,405,000




Restricted Stock Units Granted

RSUs Amounts Name of Market Value RSUs Value
Granted Grantee of stock 2/4/09 2/4/09

115,474 Staley 24.10 $2,782,923
102,644 Miller 24.10 $2,473,720
102,644 Scharf 24.10 $2,473,720
102,644 Smith 24.10 $2,473,720
102,644 Bisignano 24.10 $2,473,720
102,644 Cavanaugh 24.10 $2,473,720
102,644 Drew 24.10 $2,473,720
102,644 Maclin 24.10 $2,473,720
89,813 Zubrow 24.10 $2,164,493
89,813 Cutler 24.10 $2,164,493
59,662 Daley 24.10 $1,364,542
35,926 Rauchenberger 24.10 $865,816
--------------------------------------------------------------------------------------------------
Total value (2/6/09) of RSUs Granted = $30,500,000

Total value (2/6/09)of Grants to top 15 executives= $111,905,000

These totals are far more than the top executives of Merrill Lynch were to receive as their year end bonuses in cash and equity. The New York Attorney General is supposedly investigating Merrill's executives for criminal wrong doing
Merrill CEO, Thain was granting himself just $10 million whereas at least three Morgan executives exceeded that in equity compensation alone.

An interesting question arises from an examination of the fact that for the past two years grants were made on or around January 20. It just happened that the stock dropped prior to the grant and moved upward immediately after the grants. Its hard to accept the idea that those executives just got very lucky for two years in a row. Yes, I am suggesting collusion in the manipulation of the stock to accommodate the grants of options etc.

Some refer to this as spring-loading the options grants.

Is J.P. Morgan immune from investigation?

Now what we find is that bankers' errand boy extraordinaire CEO, James Dimon, is popping off about the ridiculous idea that J.P. Morgan does not need further bail-out money after Morgan grabbed $55 Billion in the Bear Sterns deal and another $25 Billion of TARP money in banker welfare payments. See:

http://www.bloomberg.com/apps/news?pid=20601109&sid=azVLk.22AkLI


If they do not need the bail-outs, let Morgan and Goldman return the welfare payments.

Perhaps also an explanation is in order of why James Dimon is not prosecuted for violations of Title 18 Section 208 U.S.C. in his role as Director of the New York Federal Bank in approving the J.P. Morgan/Bear Stearns deal.


http://law.onecle.com/uscode/18/208.html


Neither J.P. Morgan, Goldman Sachs or any other bank will return the TARP monies because the actual values of the Preferred Stock and Warrant packages were 50% lower than what the taxpayers were forced to pay. And the actual values of those packages have dropped considerably in every case since the welfare payments to Goldman, Morgan , Bank of America etc. were made.

In the case of Bank of America and Merrill, the warrants purchased by the Treasury are down over 88% since the bail-out.

John Olagues

P.S. A full reading of the SEC Form 4.com link above shows that there were sales of stock by most of the 15 executives at 23.2 in the days following the issues of the SARs and RSUs granted when the stock was 19.49. Mr. Jamie Dimon also sold 137,033 shares of stock at 23.2.

The sales and the grants are trades of equity securities within 6 months and are considered matching trades for Section 16 b of the Securities Act of 1934. Section 16 b requires those profits from the buys and sales to be "short swing" profits and are returnable to J.P. Morgan.

Now, securities attorneys will say that the grants of the SARs and RSUs are exempt under SEC Rule 16 b-3. However, the Rule effectively defeats the Statute and therefore is beyond the SEC's Rule making authority and is void. SEC Rule 16 b-3 is just another part of the SEC accommodating the executive compensation abuses including back-dating and spring loading.

If you are a holder of JP Morgan stock you can request that Jamie and his boys return their "short swing" profits. If they do not return the money, any share holder has a private right of action against Jamie and his boys to get the profits returned to the share holders.

[Tansy_Gold]

54. More on FRSP

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x5014859


See post #2



TG

[Pluvious]

65. fixed link

HERE

[Demeter]

24. Legal Protectionism: A New Mercantilism

http://angrybear.blogspot.com/2009/02/legal-protectionism-new-mercantilism.html


...I have talked many, many times about China's two-tiered tax system. It was the cleverest bit of mercantilism this decade. It violated no WTO rules. China used it as trigger for jump-starting rapid industrialization.

The plan was simple: Attract foreign corporations by taxing them at half the rate of indigenous firms. Firms from around the world fled to China, building an impressive export platform. WTO rules state that a country cannot place foreign firms at a disadvantage over indigenous firms. The WTO is quiet about indigenous firms being placed at a disadvantage. Only when the indigenous firms began to complain about this unfair advantage did China begin to modify its two-tiered taxation system.

Mercantilism is not dead; it has simply adapted to new rules, rules that are "porous," capable of evasion if one is clever enough. Mercantilism is often associated with high tariffs, resulting in perpetual war as each nation vies for trade supremacy. Well, protectionism comes in many forms, as does mercantilism....


JUST A SNIPPET--THE WHOLE THING IS WORTH THE READ

[Tansy_Gold]

30. "The WTO is quiet about indigenous firms being placed at a disadvantage"

TAKE THAT, RICHARD SHELBY, YOU FUCKING ASSHOLE.




TG

[Demeter]

26. YOU, the U.S. Taxpayer, Can't Handle the Truth

http://www.informationarbitrage.com/2009/02/you-the-us-taxpayer-cant-handle-the-truth-wrong.html

The Wall Street Journal just came out with a piece outlining a multiple-choice hairball of options which Treasury Secretary Geithner is considering. The sad truth is this: his plan will fail. Why? Excessive complexity. For a plan of this magnitude to work, it needs to be straight-forward, easy to understand, clearly communicated, brutally transparent, and ruthlessly executed. The chance of the Treasury and Congress arriving at a plan that meets these criterion appears to be approaching zero. Further, the plan is still missing a few key components, such as transparency of bank asset values and avoiding the forced requirement to lend money, flying in the face of rational decision-making and market forces.

But wait, it gets even better. Consider this comment from Rep. Brad Miller, a Democrat from North Carolina and a member of the House Financial Services Committee:
"If we had regulators go in an examine the books like we did at Fannie Mae and Freddie Mac a great number of our systemically important financial institutions could be insolvent."

And this is exactly what Mr. Miller and Treasury Secretary Geithner want to avoid; the transparency necessary to figure out exactly where the industry stands, in order that a proper prescriptive can be put in place to begin real healing, not some illusory band-aid that will only set us up for greater suffering down the road. For a member of the House Financial Services Committee to make a comment like this only highlights the disconnect between the politicians and the real problem: dealing with the systemic insolvency that threatens our country. Mr. Miller would have you believe that putting our collective heads in the sand is a better approach. He is just so wrong.

He knows the problem is there, but is unwilling to face into the truth. He thinks we can't handle it. Reality is, we can handle the truth: it's he and his scared-out-of-their-minds Congresspeople that can't handle the truth. We need some different people making the big decisions. They appear too big and too important for our small-minded Congresspeople to make.

[DemReadingDU]

31. Martin Weiss: Stocks to fall AT LEAST another 40%! Here’s why

2/9/09 Stocks to fall AT LEAST another 40%! Here’s why by Martin Weiss

With the U.S. economy now reeling from the fastest job collapse since the Great Depression …

With the Treasury Secretary ready to introduce yet another bank bailout plan this week …

And as we suffer through the uncontrollable bust of the largest-ever speculative bubble of all time …

You don’t need a Ph.D. in economics to recognize that there’s much more pain to come.

But how much pain? And precisely how FAR can the stock market decline? Not many people can provide that answer with precision.

But of all the analysts I know in the world today, one of those who provides the most reasoned — and most well-documented — answer is, not surprisingly, far away from Wall Street.

He is Claus Vogt, writing from Berlin.

Claus is the co-editor of Sicheres Geld, the German-language edition of our Safe Money Report.

He also edits the German edition of our International ETF Trader. And unlike nearly all his peers in Germany, Claus delivered overall gains in the high double digits last year, even as global markets tumbled.

Perhaps most impressive, thanks largely to Claus’ input, the bank he advises was one of the very few in Europe that actually made good money for their clients last year.

The key to his success: The ability to watch the U.S. economy from afar, track it closely, and forecast it accurately.

A case in point: Well before the U.S. housing bubble burst, Claus Vogt and co-author Roland Leuschel wrote the book, Das Greenspan Dossier, in which they predicted:

“When the U.S. real estate bubble bursts, it will not only trigger a recession and a stock market crash, but it will jeopardize the whole financial system, especially Fannie Mae and Freddie Mac, the two U.S. — mortgage giants taking center stage in this huge bubble.”

Amazingly, in that one short paragraph, they captured the full range of events unfolding today — a scenario that almost every Wall Street or Washington expert missed by a mile.

That’s why I have asked Claus to contribute more regularly to Money and Markets. That’s also why I have asked him to tell us how far the U.S. stock averages are likely to fall — and why.

Click to read Claus Vogt's report (6 pages)
http://www.moneyandmarkets.com/stocks-to-fall-at-least-another-40-here%e2%80%99s-why-29613

[Warpy]

35. That's about what I think, too

but that will be because the market will fall below its actual value after having been propped up in the stratosphere for so long by GOP tax cuts targeted toward the wealthy.

This depression will be worse than the last one because we'll need to rebuild our manufacturing infrastructure from the ground up.

We can't make it in this country just by selling off natural resources and food. We need to start manufacturing again. We can't keep going into debt buying things from offshore.

That's going to take protectionism and that means discarding the most cherished dogma of conservatives in both parties for nearly the last century.

Until and unless this starts to happen, forget about recovery. We won't see one.

[Tansy_Gold]

53. Absolutely. Ditto ditto.

But I think first we're going to see a contraction world-wide, as the U.S. adjusts to paying off its crippling debt. It's like you blow a whole lot on Christmas gifts and then you have to do without any more new stuff until the Christmas debts are paid off. Which is why we're seeing the Chinese toy factories shutting down.

People will be forced into learning to do more with less. whether they learn the lesson is another question.


TG

[DemReadingDU]

58. ditto ditto

Absolutely. Because we hardly manufacture any of the necessities in this country. Like underwear, shoes, towels, tools.

I'm still not convinced we will ever recover to what we are used to now. But our country will recover, it will just be different, not necessarily bad. but different. People are going to find they need to share more, rely more on others, help each other.

[Demeter]

36. 18 recommnedations! Must be a New High, Ozy!

And you deserve it.

[ozymandius]

38. My, my! This is a surprise!

Demeter, don't you mean we? You are so kind to grace me with such credit. :blush:

[Demeter]

39. To Be Truthful, the REAL Credit Goes to George and the Bushbots

for putting international attention on their destruction of the American Dream in all its details.

But You are the one who gets up in the dark 5 days a week....


Victor Borge used to close his program by thanking his sponsors, who made the program possible, and his children, who made it necessary...

[Theres-a]

40. 20!

:7

[DemReadingDU]

59. 24!

[ozymandius]

37. update of numbers and blather

1:17

Dow 8,302.41 Up 21.82 (0.26%)
Nasdaq 1,596.50 Up 4.79 (0.30%)
S&P 500 873.44 Up 4.84 (0.56%)
10-Yr Bond 3.051% Up 0.072
NYSE Volume 3,254,122,000
Nasdaq Volume 1,005,297,750

1:05 pm : Trading this session has been relatively subdued as market participants await Treasury's bank rescue plan and the Senate's vote on an economic recovery plan. Corporate headlines have done little to induce action.

Treasury's highly anticipated bank bailout announcement has been delayed until 11:00 AM ET Tuesday. The plan was previously scheduled to be announced this today, officials are turning their focus toward the more comprehensive economic recovery plan. Many believe the broader recovery plan, which features $827 billion in spending plans and tax cuts, could come to a vote early this week.

Still, many investors have a stronger interest in the bank rescue plan since it is believed to provide a more immediate stimulus to the financial system. Investors are also aware that any sustainable and meaningful rally in stocks likely requires the participation of financial stocks. The key, then, is for market participants to be confident that losses plaguing financials have been stemmed.

Financial stocks, as a whole, are trading with a solid gain of 1.3%. Bank of America (BAC 6.81, +0.68) is a primary leader in the sector; its shares are up more than 40% since during the course of the last three sessions. Hartford Financial (HIG 15.34, +2.66) is also providing leadership; its gains follow word that Treasury will allow insurers access to TARP funds, and word that the company's state regulator may reduce reserve requirements for the company. Shares of General Electric (GE 12.79, +1.69) are also trading markedly higher and providing leadership to the S&P 500 and the Dow; GE's shares have traded in-line with the financial sector, given the company's capital business.

The energy sector is having a fairly solid session. The sector is up 0.5% after analysts upgraded stocks of select oil and gas equipment services companies (+2.5%). Higher crude oil prices have followed word from OPEC officials that supply coulds could take place. Oil was last quoted at $40.60 per barrel, up 1.0%. Crude oil futures prices had been up more than 5% earlier.

Earnings announcements have had relatively little impact on the session's mood. Whirlpool (WHR 36.96, +0.57) announced lower earnings that were partly weighed down by charges. The company also issued downside guidance. Rohm and Haas (ROH 55.65, -0.85) announced better-than-expected fourth quarter adjusted earnings, and issued a statement that Dow Chemical (DOW 10.88, +0.00) has not been focusing on the necessary steps to complete its acquisition of ROH.

Overall, this session's subdued tone should be viewed positively. The fact stocks haven't come under stiff selling pressure after climbing almost 5% during the past three session's shows there is some underlying support in the market. DJ30 +18.63 NASDAQ +3.61 SP500 +4.15 NASDAQ Dec/Adv/Vol 1305/1247/980 mln NYSE Dec/Adv/Vol 1234/1734/611 mln

[Robbien]

41. SEC top enforcer to leave agency (Linda Thomsen)

WASHINGTON (Reuters) - The Securities and Exchange Commission will announce on Monday that its top enforcement official, Linda Thomsen, plans to leave the agency and return to the private sector, a source familiar with the matter said.

Former Assistant U.S. Attorney Robert Khuzami is expected to replace her as the SEC's enforcement director, one source familiar with the matter told Reuters over the weekend.

Another source said Thomsen had scheduled to speak to her staff and the entire enforcement division Monday morning. It was not immediately known if she would stay until Khuzami starts at the agency, the source said on Monday.

The source said the SEC was due to make the announcement at 1:30 p.m. EST (1830 GMT) on Monday.

The SEC declined to comment.

http://www.reuters.com/article/governmentFilingsNews/idUSN0748901320090209

[Demeter]

42. Don't They Mean the Top Unenforcer?

[Robbien]

45. Well, he is a GOPer

and comes from Deutsche Bank
and use to an ex-federal prosecutor (from 1998 - 2002) in charge of Securities and Commodities Fraud Task Force


So yes you are right, the top unenforcer.

[specimenfred1984]

43. Here's the dumbest financial article I've ever read

--- Greed Is Good

Wall Street bonuses are getting a bad rap, but they're an important and useful part of the financial services industry. Taking them away could hamper the economic comeback. ---

http://finance.yahoo.com/career-work/article/106556/Greed-Is-Good

[Demeter]

46. Remember What the Fellow Who Wrote "Liar's Poker" Said?

http://en.wikipedia.org/wiki/Liar%27s_Poker

In conclusion, Lewis remarked that the 1980s marked a time where anyone could make millions, provided they were at the right place at the right time, as exemplified by Ranieri's success.

[Robbien]

49. And they know when to fold them. Billionnaire financial advisers are

recommending that their clients take their money and run. They are running articles on expatriation Expatriate Now While Asset Values are Depressed

First, expatriation is the only way a U.S. citizen or long-term resident can permanently sever the obligation to pay tax on worldwide income. That makes investing and doing business offshore far easier than if you remain a U.S. taxpayer. Second, once you've expatriated, you're no longer subject to the dictates of U.S. government should it declare an "economic emergency" to deal with the worst economic crisis in 80 years. That means you'll avoid possible foreign exchange controls, forced repatriation of offshore assets, etc.


And they are holding seminars on the best way to get out now.

[specimenfred1984]

50. That's exactly what the elites did in Argentina, fled with the money

right before the economic collapse. Dumb ass "murkins" think it can't happen here and like watching Idol, saying "eyerack" and pretend to be superior to others by being able to "forgive" war criminals and financial traitors. Forty-seven percent of "murkins" have got it coming for voting repuke.

[Karenina]

51. If one is involved in global markets

the WORST thing to do is to remain a U.S. citizen. Over the past year I've read MANY articles about WHY this is so. Even if you attempt to change citizenship because you live abroad and want to participate in the political process of your adopted land, the FIRST thing that happens is the IRS comes after you. It's SO HYPOCRITICAL. If one emigrates to the U.S. it's seen as only natural to apply for citizenship. If an American ex-pat does so, s/he is subjected to unending HARASSMENT.

[AnneD]

56. That is so true....

We were looking at heading to Canada only to find the IRS can go after our retirement assets-even though we don't live in the US.

[Demeter]

44. Roubini: Anglo-Saxon model has failed

http://www.ft.com/cms/s/0/7dce3c14-f6ba-11dd-8a1f-0000779fd2ac.html



The Anglo-Saxon model of supervision and regulation of the financial system has failed, Nouriel Roubini, chairman of RGE Monitor and professor of economics at New York University, told the Financial Times on Monday.

Answering questions from FT.com readers, Prof Roubini, who is widely credited with having predicted the current financial crisis, said the supervisory system “relied on self-regulation that, in effect, meant no regulation; on market discipline that does not exist when there is euphoria and irrational exuberance; on internal risk management models that fail because – as a former chief executive of Citi put it – when the music is playing you gotta stand up and dance.”

“All the pillars of Basel II have already failed even before being implemented,” he added, referring to the internationally agreed set of banking regulations that are forcing banks to set aside more capital to maintain their existing lending.

Prof Roubini also predicted that it was possible another large bank could fail, saying: “In many countries the banks may be too big to fail but also too big to save, as the fiscal/financial resources of the sovereign may not be large enough to rescue such large insolvencies in the financial system”.

He also criticised the US and UK approach to bank bail-outs, comparing it with attempts by Japan in the 1990s to solve its banking crisis. “The current US and UK approach may end up looking like the zombie banks of Japan that were never properly restructured and ended up perpetuating the credit crunch and credit freeze,” he said.


AND HERE I THOUGHT IT WAS THE BUSH-GREENSPAN MODEL! YOU CAN'T CALL GREENSPAN AN ANGLO-SAXON, NOW, CAN YOU?

[Ghost Dog]

55. It's just shorthand for Anglo-American economics,

you know (wildly inaccurate 'ethnically'-speaking, of course) - just as Wall St. / City of London is more shorthand.

Term often used to contrast with more 'Continental' (European) approaches.

Ah, history. (Until the lion has a historian of his own, the tale of the hunt will always glorify the hunter. (African Proverb) - http://educationforum.ipbhost.com/index.php?showtopic=12609)

[Dr.Phool]

47. What ever happened to the intelligence level of this board?

Not our thread, but DU in general. I've been here for years and have never seen anything like it.

Check this out.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x5009177


Some of our bestest and brightest are actually defending banks trying to collect credit card bills from a deceased relative, from the family. Even though there is no estate.

"Well mom would have wanted me to pay it". "They'll stop giving old people credit, to pay their medical bills".

This place has gotten dumber than a box of freepers over the last year or so. After reading this, I gotta go get a drink.

Next, the DLC and repukes, and Blue Dogs will be bringing back debtors prisons, for relatives. For 3 or 4 generations.



:mad: :puke: :mad:

[Tansy_Gold]

52. It's worse than you think, Doc

It's not just intelligence -- it's attitude.

I'd be willing to bet that a few years ago, most of us would have agreed that debts should be paid. Mortgage, car loan, whatever. Library fines. Parking tickets. And even that debts incurred by "an estate" should be paid by that estate before someone else inherits it, since they would presumably be inheriting whatever had been purchased with the debts.

But now the whole mind set has changed. We've watched as the real estate developers, the mortgage brokers, the investment bankers, etc., etc., etc., etc. (not to mention the booooosh government) have screwed us over left right and inside out. In another day and time, paying off this woman's small debt -- her card limit was $1000, so it can't be very much -- would have been done without questioning it. Now, we're out to get our own, too.

I'll give you an example from my own situation.

My late husband and I had a joint checking account with a debit card (Visa) and a credit card (MasterCard) at the same bank. The checking account had overdraft protection that automatically went on the credit card. His paycheck was automatically deposited into the checking account. Both of us were on the credit card account and both of us used the credit card. A few months before his death we had taken a 5,000 road trip and put the gas and other charges on it, and then a few of his smaller medical bills -- radiation treatment co-pays, etc. -- went on it, too. At the time of his death, the balance was approximately $2500. As insurance policies paid out, I proceeded to pay off that balance as well as a few other small debts. This was in late 2005.

Thanks to a screw up from Social Security, about a year ago I had a bunch of overdrafts, which were "protected" by that credit card. At about the same time, I made a trip to Chicago just before my dad died in early 2008, and the expenses of that trip went on the same card: air fare, hotel, etc. I quickly paid about half of it down, but couldn't afford to pay it all off at once. Since then I've been able to pay more than the minumum each month and expected to have it paid off by the end of 2008, roughly six months.

Since about 2004 I had been paying my credit card bills online, deducted from that joint checking account. After his death, I converted the account into my name only, but of course still had the debit card, the same checking account number, everything. ALL that changed was that his name was off the checking account. I continued to use the credit card and make payments on it. It has a credit limit of about $20,000 and has never had a balance (since the pay-off in 2005) of more than about $500.

In August of 2008, I bought a new computer, and when I tried to pay that MasterCard account online, it wouldn't recognize the new computer. I had to get a new security authorization and I could only get that by calling the bank, which I did. They would NOT speak to me. They would only speak to the primary account holder. When I told them he was dead, they simply said I couldn't have online access to the account TO MAKE PAYMENTS.

Understand: I have continued to use the card to make purchases. They have not questioned that. I have continued to make in-person payments; they gladly take my money. But they will not give me "authorized access" so I can pay the account online.

In just a couple of months, the account will be paid off (delayed by the emergency purchase of the new computer which had to go on the account!). I will not use the card again, except the occasional purchase (and quick pay-off) to keep the account active.

My children will be given instructions that this is the card to use if needed to provide care for me when/if I'm no longer able to. And they will be given instructions NOT to pay it off after I'm dead.

Stupidity has its rewards.


Tansy Gold, who ain't stupid

[DemReadingDU]

70. I do some online banking too. What worries me, if there is

a 'bank holiday' due to system collapse, would people be able to do automatic electronic banking? If all the banks shut down (temporarily), it might be that people would have to start paying bills in person again, or maybe with a money order purchased from the Post Office.

:shrug:

[AnneD]

63. Boy I did see some dillys.....

I see how some folks can get scammed into ARM's. When it comes to biz-if you don't knoe the law you better ask. Ignorance can be expensive.

[AnneD]

57. More Happy Talk.......Hey it's great to be jobless.......

Perks of unemployment great, but a paycheck would be better

FOND DU LAC, Wis. — Jay Capelle would give anything to get back his factory job of 32 years. At the same time, he’s grateful to have extra time on his hands these days to care for his ailing wife, stay in shape and work on a long-planned baseball documentary.

The unemployed are stressed out about unpaid bills, dashed retirement plans and the loss of workplace camaraderie. But many say life minus work also has its bittersweet upsides, including more time with family and friends, learning new skills, focusing on their health and pursuing hobbies.

There is a wide range of opinions, of course, about just how sweet, or bitter, the experience has been.

An idled auto worker in Wisconsin cherishes extra time with his kids and his guitar. A former communications worker in Virginia finds time for hiking as a distraction from the job search. But two jobless friends in North Carolina who have played plenty of golf together say enough is enough: They’re ready again for the joy of earning a paycheck.

More......

http://www.chron.com/disp/story.mpl/business/6253463.html

Good God, what next-the 2008 version of the Waltons.

[PassingFair]

61. Good night, John-Boy....n/t

[Tansy_Gold]

64. Unrealistic

My in-laws grew up on farms in Indiana during the Depression. They used to watch The Waltons and laugh at how absurd it was. The Waltons lived like millionaires compared to what many farm families went through.


G'night, AnneD

G'night, Ozy

G'night, Doc

G'night, Demeter


Oh, wait, I've got electric lights. I don't need to go to bed as soon as it gets dark. . . . ..



TG

[Demeter]

67. G'night Tansy Gold

Sweet dreams! No Madame La Guillotine, now.

[llmart]

68. These sorts of articles.......

are of the same genre of how baby boomers are just going to love working until they're 90 years old. I hate this kind of "pap" reporting. Do people really believe this crap? Next up - an article on how living in a homeless shelter reminds you so much of your college dormitory years and how young it makes you feel.

[Tansy_Gold]

69. LOL -- I ***despised*** every single one of my college roommates

Without exception. Loathed them.

The most miserable months of my life.

[ozymandius]

60. end of the day stuff

Dow 8,270.87 Down 9.72 (0.12%)
Nasdaq 1,591.56 Down 0.15 (0.01%)
S&P 500 869.89 Up 1.29 (0.15%)
10-Yr Bond 3.027% Up 0.048
NYSE Volume 5,675,245,000
Nasdaq Volume 1,909,820,875

4:25 pm : Stocks closed a relatively quiet session modestly higher as market participants continue awaiting Treasury's bank rescue plan. Though the advance was only modest, the takeaway from this session is largely positive.

Investors were made to wait one more day for Treasury's bank bailout plan. The plan will be announced at 11:00 AM ET Tuesday.

Though less likely to have an immediate impact on the financial sector or capital markets, market participants are also still waiting for the Senate to pass the more comprehensive economic recovery plan. Senators are expected to vote on an $827 billion spending and tax cut plan early this week. The plan still has to be reconciled with that which was already approved by the House of Representatives.

Financial stocks continue to benefit as investors move into the sector ahead of tomorrow's announcement from Treasury. The financial sector closed 1.3% higher with leadership from diversified financial services companies (+2.3%) and regional banks (+4.0%). Insurers (+5.1%) also showed strength after Treasury indicated insurers will have access to TARP funds.

Shares of General Electric (GE 12.64, +1.54) made their best-single session gain in years. There wasn't a particular news item underpinning the move, but many analysts point to the exposure of the firm's capital business to financial markets as a reason for the renewed interest. GE provided support to the Dow, S&P 500, and industrial stocks, which bested every other sector with a 2.6% gain.

Energy (+0.1%) and technology (+0.3%) were able to finish in the green.

Energy advanced even though crude oil futures prices closed 1.8% lower at $39.42 per barrel. Crude had been up as much as 5.6% after officials from OPEC indicated supply cuts could take place. Despite lower oil prices, select oil and gas equipment companies gained after Reuters reported analysts at Goldman Sachs issued upgrades on certain industry players. As a group, oil and gas equipment companies finished 0.8% higher.

Large-cap tech provided continued strength to the tech sector and the Nasdaq 100 (+0.3%). Their influence limited losses in the broader Nasdaq Composite (unch.), helping it preserve its year-to-date gain of 0.9%.

Earnings news was rather light and had little impact on the session's mood. Whirlpool (WHR 37.13, +0.74) announced lower earnings that were partly weighed down by charges. The company also issued downside guidance. Rohm and Haas (ROH 56.28, -0.22) announced better-than-expected fourth quarter adjusted earnings, and issued a statement that Dow Chemical (DOW 10.65, -0.23) has not been focusing on the necessary steps to complete its acquisition of ROH.

The major indices all finished the session near the neutral line. Though a quiet session, market participants should view it positively since stocks have thus far held on to gains registered in recent sessions. Stocks are still up 4.5% over the course of the last three sessions. DJ30 -9.72 NASDAQ -0.15 NQ100 +0.3% R2K -0.6% SP400 -0.2% SP500 +1.29 NASDAQ Adv/Vol/Dec 1197/1.90 bln/1458 NYSE Adv/Vol/Dec 1653/1.26 bln/1383