STOCK MARKET WATCH, Friday February 20

[ozymandius]

Source: du

STOCK MARKET WATCH, Friday February 20, 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 19, 2009

Dow... 7,465.95 -89.68 (-1.20%)
Nasdaq... 1,442.82 -25.15 (-1.71%)
S&P 500... 778.94 -9.48 (-1.20%)
Gold future... 976.50 -1.70 (-0.17%)
30-Year Bond 3.69% +0.16 (+4.62%)
10-Yr Bond... 2.86% +0.13 (+4.73%)

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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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Read more: du

[ozymandius]

1. Market WrapUp

Market Teetering on the Brink
BY MARTIN GOLDBERG, CMT

Since late November the stock market appears to have been consolidating its losses. The important question (to be answered soon) is whether the action since late November is merely a consolidation before the long term downtrend continues, or if long term support at S&P 800 will hold. Transports are relatively weak, and technology is relatively strong. One technical pattern that looks compelling in today's market is the cup-with-handle which is forming in most of the major US indexes. This is normally a bullish pattern, but in this case the pattern is bearish because it appears on the transposed chart (where up is down). Transposing the chart makes the visualization of the pattern simpler since most analysts typically look for bullish patterns. As shown in the 2 year chart below, the cup-with-handle consists of a long term consolidation (cup) followed by a move in the direction of the trend ("up" on the chart) followed by a short term consolidation of the "gains" followed finally by a break into new ground (breakout). There has likely been pattern completion in the Dow Transports index as shown in the chart below. If not, what is labeled as a breakout would have to be refuted as a false move within a matter of days.


-see chart-

....

If the market is going to be led out of this mess and maintain 800 as support, it will probably be on the shoulders of the Nasdaq 100. Among the strongest and most liquid stocks in this group is Amazon.com. Here is the 2 year chart appropriately oriented (up is up). Amazon has a relative strength of 95 and now sits between converging 50 and 200 day moving averages.

....

How important is 800 as support? Very important. When the market was slammed down to about 800 on Monday, following the close, CNBC trotted out none other than Alan Greenspan, the Maestro, to declare among other things that stocks are "cheap." No surprise here in that the Maestro has been the number one go-to guy for manipulating public opinion on financial markets. But what is most disconcerting about the market action following his comments is the oversold market seems to have not been able to rally. In fact today, just the 2nd day after his comments, the market is selling off into new low ground. This would seem to be significant. When the Maestro cannot support a long term support level, then who can?

....

The Dow broke into multi-year lows today. How can this be just two days after the Maestro declared stocks "cheap"? The problem is one of credibility. Mr. Greenspan, once the most respected individual on Wall Street has lost his. In addition, Wall Street, the nebulous reason for the US' prosperity since the Reagan years, has gone from perceived hero to actual demon.

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

[ozymandius]

Today's Reports

08:30 Core CPI Jan
Briefing.com 0.0%
Consensus 0.1%
Prior 0.0%

08:30 CPI Jan
Briefing.com 0.2%
Consensus 0.3%
Prior -0.8%

http://www.briefing.com/Investor/Public/Calendars/EconomicCalendar.htm

[ozymandius]

8. U.S. consumer prices seen up in January

NEW YORK (Reuters) – U.S. consumer prices are estimated to have risen in January as a recent rise in energy prices defied the economic downturn and disinflationary trends, according to economists polled by Reuters.

As energy prices rose, a median forecast culled from a poll of more than 70 economists estimated that consumer prices overall rose 0.3 percent in January from December, while prices excluding food and energy items rose 0.1 percent.

A poll of more than 40 economists offered a median forecast for a year-over-year 0.2 percent drop in consumer prices in January. Core consumer prices were estimated up 1.5 percent from a year ago.

http://news.yahoo.com/s/nm/20090220/bs_nm/us_usa_economy_prices

[UpInArms]

56. U.S. CPI unchanged over past year, 53-year low (hahahahaha! There is NO inflation!)

01. U.S. Jan. consumer price index up 0.3% as expected
8:30 AM ET, Feb 20, 2009

02. U.S. Jan. core CPI up 0.2% vs. 0.1% expected
8:30 AM ET, Feb 20, 2009

03. U.S. CPI unchanged over past year, 53-year low
8:30 AM ET, Feb 20, 2009

04. U.S. core CPI up 1.7% in past year, 4-year low
8:30 AM ET, Feb 20, 2009

05. U.S. Jan. energy prices up 1.7%
8:30 AM ET, Feb 20, 2009

06. U.S. Jan. food prices up 0.1%
8:30 AM ET, Feb 20, 2009

[UpInArms]

60. Consumer prices flat over past year

http://www.marketwatch.com/news/story/Consumer-prices-flat-over-past/story.aspx?guid=%7BCC54C0B2%2DF522%2D48DA%2D8564%2D14F15AC69A10%7D

WASHINGTON (MarketWatch) - With energy prices tumbling 20%, U.S. consumer prices were unchanged over the past 12 months, the lowest 12-month inflation rate since 1955, the Labor Department reported Friday. In January, the consumer price index rose 0.3% seasonally adjusted as expected, the government said, as energy prices rose 1.7%, the first increase since July. The core CPI - which strips out food and energy prices to get a better handle on underlying inflation trends - rose 0.2% seasonally adjusted in January compared with the 0.1% gain expected by economists surveyed by MarketWatch.Over the past 12 months, the core CPI is up 1.7%, the lowest inflation since mid-2004.

[Demeter]

104. Of Course Not. It's All Your Imagination!

Gas prices halved, dairy and beef lower. Temporary lulls...

[snowbear]

2. All those charts and numbers...

.
.

(( ))

Do you think we'll end the week on an even lower note than today (Thursday)?

I sure hope we see at least a small gain in the stock market on Friday (today)..


- -

[ozymandius]

3. I've scoured the futures reports.

They all have negatives in front of the numbers. Stocks around the world are taking a hard hit, mostly due to banks. I am sorry this is troubling for you.

[Dr.Phool]

17. How the mighty have fallen.

Citi is below $2.00 a share. Isn't below $1 considered a penny stock?

Why would anyone buy a share in Citi, BoA, Wells Fargo, or Chase with all the talk about nationalization, and wiping out shareholders?

[ozymandius]

26. The 1929 crash started like this.

Shares' prices kept falling because no one was buying. On page 102 of J.K. Galbraith's The Great Crash 1929, Richard Whitney, then vice-president of the NYSE, walked the trading floor from station to station buying huge loads of stocks at the last asking price for each share (10,000 shares of U.S. Steel at $225, for example) to bolster confidence. This worked for about a day.

I cannot point out anyone today, who has the gravitas of Whitney in 1929, to pull such a stunt. Though I highly suspect that in a much more sophisticated trading environment, we could see the weight of some institution being thrown behind a similar kind of theater.

[UpInArms]

33. Buffett buys big stake in Kraft

http://money.cnn.com/2008/02/14/news/companies/berkshire_hathaway/index.htm?postversion=2008021422

February 14 2008: 10:42 PM EST

NEW YORK (CNNMoney.com) -- Warren Buffett's investment group, Berkshire Hathaway, bought more than 132 million shares of food company Kraft, according to a document filed with the Securities and Exchange Commission Thursday.

Billionaire Buffett, whose nickname is the "Oracle of Omaha," is one of the world's most well-known investors.

Thursday's required fourth-quarter report of Berkshire's holdings also lists the addition of 1.5 million shares of European drugmaker GlaxoSmithKline.

Speculation circulated in the middle of last year that Berkshire Hathaway (BRK.A) would buy a stake in Kraft.

Shares of Kraft Foods (KFT) grew 0.77 cents, or 2.63%, to $30.08 in after-hours trading. U.S.-traded shares of GlaxoSmithKline (GSK) rose 0.85 cents, or 1.96% to $44.17.

Earlier this week, Buffett shocked the markets by offering to reinsure about $800 billion of tax-exempt or municipal bond obligations of bond insurers MBIA (MBI), Ambac (ABK) and FGIC.

[Demeter]

36. Buffet and Bill Gates Might Be the Exceptions

The Saudis, because of their massive overhead of royalty, are not buying. The other Arab states are bailing out Dubai.

The Russian bear is consolidating its power.

The Chinese are sweating bullets.

May you live in interesting times.....

[DemReadingDU]

37. Kraft -> Cheese-> Yum!

Cheese lovers in this house. Can't buy it too often, spouse thinks the package is the serving.

:silly:

[tclambert]

39. Is he betting that everyone's going to be eating a predominantly mac & cheese diet from now on?

It might be smart to invest in Ramen noodles.

[dixiegrrrrl]

127. Ramen and macaroni bad investment, in money and health.

until they get the melamine out of the flour and GMO out of both grains.
oh, and the HFC syrup and etc, addiitives.

[Ghost Dog]

49. Kraft Foods, Inc. (NYSE: KFT) is the second-largest US-based food and beverage company...

Kraft Foods, Inc. (NYSE: KFT) is the second-largest food and beverage company headquartered in the United States (after PepsiCo) and the third largest in the world (after Nestlé SA and PepsiCo).

The Philip Morris Company (now known as Altria Group), acquired Kraft for $12.9 billion in 1988, eventually merging it with another food subsidiary, General Foods, which it had acquired in 1985. In 2000, Philip Morris acquired Nabisco and merged it with Kraft. Altria sold 280 million Kraft shares via an initial public offering in 2001, retaining an 88.1% stake. On January 31, 2007, after months of speculation, the company announced that its 88.1% stake would be spun off to Altria shareholders at the end of March 2007. Kraft is now an independent publicly held company.

Kraft is headquartered in Northfield, Illinois, USA, a Chicago suburb. Kraft Foods markets many popular brands in more than 155 countries.

Kraft Foods became a component of the Dow Jones Industrial Average on September 22, 2008, replacing AIG.

/More at wikipedia, including the long list of all their various brands... http://en.wikipedia.org/wiki/Kraft_Foods#Brands

I'd reckoned that these large food companies ought to be quite strong defensive stocks... in inflationary circumstances, but less so in deflationary times... although they are all vulnerable to potential errors and scandals... Any thoughts?

There was this on Nestlé S.A. yesterday, for example:

Nestle's Not Melting

Swiss food-and-nutrition titan Nestle, the icon of the food-and-beverage industry, had some refreshing news for investors on Thursday. The company beat fourth-quarter sales expectations, ramped up annual profits by a whopping 69.4% on asset disposal gains and only slightly reduced its outlook for 2009. With commodity costs set to weaken this year, and core profitability set to improve, Nestle is likely to avoid the worst the global economic downturn has to offer.

"We believe that will once again be one of the industry's fastest-growing companies in 2009," said Chief Executive Paul Bulcke, adding that the company was committed to achieving recurring sales growth of "at least" 5.0% in 2009, as well as pre-interest, tax and amortization profit-margin growth of 0.5%. This was actually below the 5.0% to 6.0% recurring-growth guidance usually associated with Nestle, but it was enough to keep investor confidence flowing.

/... http://www.forbes.com/2009/02/19/nestle-danone-unilever-markets-equity-0219_food_08.html

[DemWynner]

66. Buffett is getting a good deal

A company like Kraft will not go out of business and food is something that everyone needs. Especially easy and quick to fix as people will have to get many part time jobs just to survive. Sig. other works for General Mills and he says business is pretty good compared to other companies.

[Demeter]

34. They're All Broke

Nobody has the cash or the credit to go on a buying spree.

GE took its vulture capital to shore up its own ponzi scheme.

Cerberus is begging for federal handouts and getting the cold shoulder.

The leveraged buyout is extinct, thank god.

The gold bugs have illiquid assets, and they wouldn't buy anyway.

A lot of potential looting has been thwarted by previous looting.

The bargain hunting has yet to start.

[AnneD]

79. Morning Marketeers......

:donut: and lurkers. I love to read novels but don't seem to have as much time as I did in my youth. One of my favorites (like -if you were shipwrecked on a desert island favorites) is Once and Future King by White. It is a book of King Arthur's life and times. I find so many truths in it. On that speaks to me now as relevant was the story of Lancelot. One thing that was a source of power and strength for Lancelot was is honour. He realized that honour was all important as it fosters trust.

You might ask yourself...why is she yammering on about this, on a stock thread. Well, some of these Titans of WS have failed-as usual-to think some of these things through. For the average Joe-we trust that our dollar is worth something, we trust that we buy a stock, that it is worth what we pay for it, we trust that our broker has our interests at heart or at least tries to make money.

Our trust has been shattered because, as we have discovered, many of these people we cannot trust because they have no honour. For Wall Street as a whole that means small investor may find other avenues of investment-even making less gain for security (bet that 3% passbook savings rate looks real good to a lot of people right about now). And if WS thinks the small investor can be dogged into putting his retirement into WS, they have another thing coming. Every time a Ken Lay, Bernie Madoff, Frank Manzilo, and Stanford-it further erodes the honour of Wall Street. And the fact that they have resisted the slightest attempt at honest and transparent regulations and book keeping show that they do not deserve our trust OR OUR INVESTMENT MONEY.

IF, WHEN, AND UNTIL these WS companies correct these problems, investors have every right to refuse investment and flee-as they have appeared to have done. And that is the real problem WS will have to deal with for years to come.

Happy hunting and watch out for the bears.

[Demeter]

105. I'm Beginning to think that wealth is a measure of psychopathy

Especially in excess.

[DemReadingDU]

44. 1929 crash occurred over 3 days

The initial crash occurred on Black Thursday (October 24, 1929), but it was the catastrophic downturn of Black Monday and Tuesday (October 28 and October 29, 1929) that precipitated widespread panic and the onset of unprecedented and long-lasting consequences for the United States. The collapse continued for a month.

lots more...
http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929



For many, many years, I always thought it was a one-day crash.

[PassingFair]

111. I'm reading that part of the book right now!

I never expected it to be so WELL WRITTEN.

It has been an ACTUAL pleasure reading
about the catastrophe.

Especially when compared to "The Shock Doctrine".
Fascinating, but HARD TO READ.

[DemReadingDU]

38. Fifth Third Bank @ $1.21

Citibank @ $2.51

"Why would anyone buy a share in Citi, BoA, Wells Fargo, or Chase with all the talk about nationalization, and wiping out shareholders?"

They like to gamble.


:crazy:

[Dr.Phool]

48. So do I.

But you stay away from sucker bets, such as anything in the middle of the craps table.

[DUlover2909]

41. Who's in power now? I think Obama should just make the case.

It would be so easy for the current administration to just make the case and blame Bushco for this whole disaster. They really are responsible. Make the case and lay it squarely at their feet. He mentions that he "inherited this situation" etc., but go an ahead and prove it. Blame the Pukes and make the case. Convince people that this mess belongs to Bushco and repukelicans. Hell, make shit up if you have to. It's not like lying to the American people matters. Bushco did it for 8 years with no consequences. Play hard ball and lay this mess directly at their feet.

[DemReadingDU]

45. me too

Otherwise, when the economy crashes, the clueless will blame Obama because he is the current president.

[NewEnglandKnowledge]

151. They are doing it for him

The Republicans are falling on their sword in front of us. 
They will not abandon the fiscal conservative mantra and they
will pay for it.  Obama just has to ride this out and make
sure it turns around, or more importantly, seems to be turning
around.  Then he takes the credit without giving the blame. 
The fact is all of government is responsible for this. If
Democrats don't own that, don't admit that they were a part of
the run up to the crisis, then they may lose this opportunity
to really bury the GOP for decades.  They have to be the
champions of the solution, not the judge and jury of
perpetrators.  That is for the Judiciary.    

[snot]

157. I agree.

[Earth_First]

29. Hold onto your butts today...

Asian and European markets are down 2.5% and futures down 1.9%

CPI and 4Q earnings on Lowe's and others due today...

With the market crossing the 'psychological barrier' at yesterday's close, today could breech 7000.

[DemReadingDU]

43. I would expect Bernanke to perform his magic

Geithner too.

They'll try to do whatever to prevent a crash. Seems harder all the time to keep control, when other countries' markets are losing confidence.

[Demeter]

107. Man the Pumps!

You're right, they certainly appear to be sloshing the water levels about...

[ozymandius]

4. Oil falls below $39, reversing big gain overnight

SINGAPORE – Oil prices fell below $39 a barrel Friday in Asia as investor concerns about weak crude demand continued to linger even after lower-than-expected inventory numbers sparked a big gain overnight.

Light, sweet crude for March delivery fell 88 cents to $38.60 a barrel by afternoon in Singapore on the New York Mercantile Exchange. The contract on Thursday surged $4.86, or 14 percent, to settle at $39.48.

Most trading volume was with the April contract, which fell 89 cents to $39.29 after jumping $2.77 to settle at $40.18.

The jump in prices on Thursday was fueled by an Energy Information Administration report that showed crude stocks decreased 200,000 barrels for the week ended Friday.

....

In other Nymex trading, gasoline futures fell 2.86 cents to $1.07 a gallon. Heating oil dropped 1.83 cents to $1.19 a gallon, while natural gas for March delivery slid 5.2 cents to $4.03 per 1,000 cubic feet.

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

[ozymandius]

7. Gas Demand Edges Higher, Lifting Crude

Months after soaring fuel prices spurred U.S. drivers to cut back on their driving, demand for gasoline is slowly coming back, helping to push up depressed oil prices.

Demand for gasoline has nudged up above last year's levels for the past couple of weeks, government data released Thursday show. Gas prices have been hovering under $2 a gallon since November, but now that they have been low for a while, consumers might be getting bolder about their gasoline use, analysts say.

In response, refiners who had dramatically curtailed production have begun ramping up gasoline output, drawing an additional 16,000 barrels of oil a day from storage last week, compared with the previous week. The nation's oil stocks, which had been swelling to record levels, dropped last week for the first time in almost two months, driving crude-oil futures up $4.86, or 14%, to settle at $39.48 a barrel Thursday after two days of declines.

....

The feeble U.S. economy is expected to remain a drag on gas demand and prices. While consumption is firming up, the increase from last year is tiny -- a four-week average of 0.8% last week, despite gasoline prices that are more than $1 lower than during the same period last year. Some energy experts, including the Department of Energy's Energy Information Administration, predict that this year's gasoline demand will be lower than in 2008 overall.

http://online.wsj.com/article/SB123508837588127981.html

[Robbien]

110. Oil spikes above $40 due to short-covering; bearish case remains intact

Oil surged more than 7% Thursday and briefly traded above $40, after U.S. weekly oil inventories unexpectedly declined. But traders don't view it as a market reversal.

The oil bulls are certainly trying to make the case that oil has bottomed at $35. Officially, oil for March delivery closed Thursday at $39.48 per barrel up $4.86 on NYMEX.

You, too, must be an oil bull if you believe the recession is over. And if you believe layoffs will start trending lower. And if you believe household formation will increase. And if you believe business investment will increase at healthy rates. And if you believe the worst of the financial crisis that's constricted credit is behind us.

As the oil bears would quickly point out, however, there's a lot of 'ifs' in that previous paragraph.

That is why bears like energy trader Paul Schmidt have kept their short trades running. "Today's action is largely an overreaction to the inventory number, which fell by 138,000 barrels in a surprise, and due to short-covering." Schmidt adds that he is currently short oil and natural gas.

In other words, it pays to pull the lens back, for context and perspective. There are financial institutions and traders who opened oil-short and comparable positions when oil was at $70, $90, even at $110, Schmidt says. "Any sudden anomaly or a large daily move will cause some of these guys to close positions, and you get a quasi-short squeeze."

Quasi, Schmidt adds, because, technically, it's not a loss-induced short-squeeze, but profit-taking after a long, long walk down for oil.

Which is why, despite the U.S. Energy Information Agency's report of a 138,000-barrel draw in weekly oil inventories (Bloomberg News consensus was for an increase of 3.2 million barrels), Schmidt expects oil to resume its downward path in a day or so.

http://www.dailyfinance.com/2009/02/19/oil-spikes-above-40-due-to-short-covering-bearish-case-remains/

[ozymandius]

5. World stocks fall sharply after Wall Street tumble

HONG KONG – World stock markets dropped sharply Friday, with benchmarks in Japan and Hong Kong sliding about 2 percent or more, after gnawing economic fears sent Wall Street tumbling to its lowest close in more than six years.

Investors in Asia and Europe found few reasons to wade into the market after the Dow Jones breached the levels it touched in November when global equities went into a tailspin at the height of last year's financial crisis.

The Dow's miserable finish — its worst since Oct. 9, 2002, when the last bear market hit bottom — deepened concerns that the markets' downturn is far from over. It also provided a clear sign that investors don't see a quick end to the worst global slowdown in decades despite the unprecedented intervention in economies and markets by governments around the world.

....

In Asia, Japan's Nikkei 225 stock average lost 141.27 points, or 1.9 percent, to 7,416.38, and the broader Topix index hurtled to its worst finish in 25 years.

Hong Kong's Hang Seng dropped 324.59, or 2.5 percent, to 12,699.17. In South Korea, the Kospi shed 3.7 percent to 1,065.80 as the country's currency, the won, lost more ground against the dollar. A weaker won can lead to higher costs for domestic firms.

http://news.yahoo.com/s/ap/20090220/ap_on_bi_ge/world_markets

[Ghost Dog]

32. Europe shares at six-year low on balance sheet fears

Fri Feb 20, 2009 5:41am ESTvPARIS, Feb 20 (Reuters) - European stocks extended their hefty losses on Friday, tumbling to a six-year low as investors fretted about the prospect of more capital increases and bank nationalisations on the back of a deepening economic downturn.

At 1013 GMT, the FTSEurofirst 300 .FTEU3 index of top European shares was down 2.9 percent at 741.78 points, having hit a low of 739.12, the index's lowest level since March 2003.

"We're near the cliff's edge, very close to capitulation, the mood is very gloomy," said Jean-Claude Petit, head of equities at Barclays Wealth Managers France.

"I'm not sure that governments and central banks are realising what's really going on. The gaffes made by West-European banks in East Europe revealed recently are having a devastating effect on the market," he said.

Saint-Gobain (SGOB.PA) tumbled 15 percent after the French building material group launched a surprise 1.5 billion euro ($1.89 billion) rights issue.

Lafarge (LAFP.PA), the world's biggest cement maker, also launched a 1.5 billion euro rights issue and slashed its dividend in a bid to shore up its balance sheet. Lafarge shares were down 1 percent, as the widely expected rights issue was already priced in, traders say.

"A lot of companies will have to ease the pressure on the balance sheets, so there are many candidates for capital increases," Petit said.

"Companies have to choose between the plague and cholera: either they have a shaky balance sheet, and the market doesn't like it, or they raise capital, which the market doesn't like either."

UBS (UBSN.VX) plunged 17 percent after U.S. tax authorities said they were widening a probe into the Swiss bank and wanted 52,000 client names, a day after UBS agreed to a hefty fine to settle criminal charges.

...

Across Europe, the FTSE 100 .FTSE index was down 2.6 percent, Germany's DAX .GDAXI was down 3.3 percent and France's CAC 40 .FCHI was 3.1 percent lower.

/... http://www.reuters.com/article/marketsNews/idCALK28101720090220?rpc=44&sp=true

[Ghost Dog]

82. European stocks hit six-year lows as banks tumble

LONDON, Feb 20 (Reuters) - European shares hit a six-year closing low on Friday, with investors dumping equities to grab assets such as bonds and gold as deepening economic downturn hit market sentiment and raised fears of bank nationalisations.

Safe-haven buying lifted U.S. gold futures to a seven-month high above a key psychological level of $1,000 an ounce, while Euro zone government bonds rose after record low readings of euro zone purchasing managers' indexes.

Banking stocks suffered the most, with Credit Agricole (CAGR.PA) slipping 9 percent, Royal Bank of Scotland (RBS.L) down 11.5 percent, UBS (UBSN.VX) dropping 14 percent, Dexia (DEXI.BR) down 8.4 percent and Commerzbank (CBKG.DE) declining 8.6 percent.

The FTSEurofirst 300 .FTEU3 index of top European shares provisionally closed 3.3 percent down at 738.57 points after hitting a low of 736.27 points -- its lowest since March 2003.

The benchmark index declined 7.3 percent this week to fall for the second week in a row. It is down more than 11 percent so far this year after tumbling 45 percent in 2008 on a credit crisis -- the worst since the Great Depression of the 1930s.

/.. http://www.reuters.com/article/marketsNews/idLTALK9917320090220?rpc=44

[ozymandius]

6. Questioning Stanford's returns could get you fired

WASHINGTON – While R. Allen Stanford's investors were swallowing claims of vast returns on safe investments, some of his employees weren't so sure.

And though one of them tried as early as 2003 to pass on to regulators his concerns about the bank, nothing came of it until Stanford's operations were raided and shut down Tuesday.

The Texas billionaire with a reputation for jet-setting and lavish spending faces civil charges for allegedly lying about his investment strategy. But in 2003, when his offshore banking empire was exploding in size, even asking managers one question too many could get you fired, Miami broker Charles Hazlett said.

....

Eventually, Hazlett said, he called a meeting with a top officer of the bank to ask how the investments worked. Instead of answers, he got an ultimatum: Resign or be fired.

http://news.yahoo.com/s/ap/20090220/ap_on_bi_ge/stanford_employees_knew

[UpInArms]

23. Billionaire in fraud case always saw bright future

http://news.yahoo.com/s/ap/20090220/ap_on_bi_ge/stanford_deceit

<snipping to the interesting part>

The company also made it hard to tell exactly what the portfolio's investments were. Any accountant who looked at those reports would have told investors to be cautious, Wells said.

Yet the numbers were alluring: Double-digit returns, and in tax-free Antigua to boot.

The exotic locale only added to the attraction.

"A visit to Antigua is part of the overall experience of the Stanford service and quality," a company memo reads.

Bank employees were instructed to arrange visits only for clients with $5 million or more to invest. Employees were encouraged to tell their bosses about client interests, such as "amateur sailor," so visits could be personalized.

In the company's mid-2008 newsletter, Stanford said his company was not disheartened by "doom and gloom" economists predicting a long recession.

"Even the most severe down cycles can bring opportunities that yield significant benefits in the long run," Stanford wrote. "This proven, well-grounded approach when making investment decisions and giving investment advice will benefit you, our clients, in these tumultuous times as never before."

Early this year, cracks began to show in Stanford's once unbridled optimism. Regulators noticed an alarming increase in wire transfers as Stanford International Bank tried to move money out of its investment accounts. Clients were prohibited from cashing out, regulators said.

As for the billions of dollars invested in the bank's seemingly safe, lucrative portfolio, the SEC has hired a receiver to scour the world looking for it.

...more at link...

[Demeter]

25. With Any Luck, That Bright Future Is the Fires of Hell

[Robbien]

81. Stanford was supposed to appear in divorce court yesterday

It is not just the USA federal agents who would like to know the whereabouts of Allen Stanford right now. His estranged wife, Susan, is also wondering what has happened to him, after the date of their divorce hearing, scheduled for 9am local time today, had to be postponed,

An attorney for Mrs Stanford told ABC News that the rescheduling had nothing to do with the recent revelations, but nevertheless, the timing is sure to raise one or two eyebrows. And, in the light of her husband’s financial meltdown, she might wonder what will be left for her after the settlement is finally agreed.

Among the conditions of the divorce, according to the temporary orders filed on May 29, 2008, Robert (sic) Stanford must pay Susan Stanford $100,000 a month in spousal support. In addition, he will provide expenses and coverage for a 2004 model Mercedes G55, a 2008 Mercedes S63, and a 1998 Porsche Boxter.

The expenses for Susan’s residence in Holly Springs are also meant to be covered, plus the costs of her condo in Kirby, Huntington, which is currently in the temporary possession of their daughter, Randi. She is also to be given access and use of her husband’s corporate jets, yacht, the Friar Hills estate in Antigua, and all Stanford company tickets, including the Stanford suite at Toyota Center. Never mind the SEC investigation, with those sorts of demands, it’s little wonder that Stanford has gone into hiding.

http://www.divorcesaloon.com/to-sir-robert-allen-stanford-with-love-what-his-wife-susan-wants-to-go-away-and-his-fiancee-andrea-wants-to-stay

Also

Rumor:

IMG clients include Tiger Woods, David Toms, Sergio Garcia, and Arnold Palmer. The talent agency could have a direct connection to R. Allen Stanford Financial Group and these four clients could be involved. The New York Post cited three unknown sources that IMG and Stanford had a “quid pro quo” deal in which Stanford paid IMG a fee to steer their clients toward their investment firms.
http://www.churchofcowherd.com/img-connected-to-stanford-group/


Denial of Rumor:

Tiger Woods and other athletes represented by the sports management firm IMG never were steered to invest with Stanford Group Co., the agent for the world’s top- ranked golfer said. Mark Steinberg, who heads IMG’s golf division, called a report in today’s New York Post about a financial connection between the two companies “complete fiction” and “completely irresponsible.”
While IMG-represented golfers including Vijay Singh, Camilo Villegas and Morgan Pressel have endorsement agreements with Stanford, IMG doesn’t give investment advice to its clients, Steinberg said in an e-mailed statement.

The Post stands by its story, spokeswoman Suzanne Halpin said in an e-mail.

http://www.bloomberg.com/apps/news?pid=20601079&sid=aZz2WLR2aibk&refer=home

[ozymandius]

9. US wants Swiss bank UBS to identify tax dodgers

WASHINGTON – Uncle Sam wants UBS to stop hiding tax cheats.

U.S. tax collectors slapped the Swiss-based banking giant with a lawsuit Thursday seeking the identities of tens of thousands of clients who kept billions of dollars in assets at the bank to dodge the IRS. A defiant Swiss president pledged to maintain his country's bank secrecy laws.

In the suit filed in Miami, the Obama administration wants UBS to turn over information on as many as 52,000 U.S. customers who concealed their accounts from the U.S. government in violation of tax laws.

....

Merz said Swiss authorities handed over the files on the 250 to 300 American clients of who are suspected of tax fraud. The transfer took place in the middle of the night in the Swiss capital, Bern, just ahead of a U.S. deadline for Swiss cooperation, he said.

But U.S. officials want much more. According to Thursday's filing, the thousands of accounts in question held about $14.8 billion in assets in the past decade.

http://news.yahoo.com/s/ap/20090220/ap_on_go_ot/ubs_secrets

[ozymandius]

10. UBS move shakes foundations of Swiss bank secrecy

BERN, Switzerland – Switzerland's president declared Thursday that his country will hold onto its treasured tradition of confidential bank accounts, even as it took the unprecedented step of revealing over 250 tax cheats to U.S. authorities.

....

Switzerland's largest bank and U.S. officials have been negotiating intensely since allegations surfaced last year that UBS helped as many as 17,000 Americans conceal up to $20 billion.

Merz, UBS and Switzerland's financial regulator all insist that Thursday's handover is not a retreat from the principle of banking secrecy because it concerns only a small number of files that are linked to tax fraud — and not tax evasion.

Under a 75-year-old law, Swiss banking secrecy can only be lifted when individuals are deemed to have deliberately defrauded tax authorities as opposed to failing to declare all assets, a distinction only Switzerland and other tax havens make.

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

[Demeter]

20. I Don't Understand Why Bush Administration Took After UBS

Politically, it doesn't connect.

There wasn't a crime known to the law that Bush didn't ignore, commit, or support. Why taxes? Why UBS?

How did they manage to get on the revenge side of Bush?

This has been going on too long before the election to be petty--someone was out for blood. And with any luck, they will get it.

Since Shrub hasn't left the country, I assume he keeps his stash in some other tax haven.

I can't accept the possibility that the IRS is doing this all on its own, but I suppose it's possible.

It's just not bloody likely.

[PassingFair]

109. We will probably find bi-partisan crooks.

Things were looking pretty one-sided.

[Ghost Dog]

40. Concerns about privacy rules hit Swiss banks

Fri Feb 20, 2009 5:40am EST ZURICH (Reuters) - Shares in Swiss banks dived on Friday amid concern the country's once strict privacy rules are being weakened by a U.S. tax probe into UBS, potentially damaging the country's wealth management industry.

Swiss wealth management giant UBS was leading the fall in Swiss bank shares. It was down 17 percent at 5:07 a.m. EST after hitting a fresh all-time low at 10.60 Swiss francs.

Shares in bank rivals Credit Suisse and Julius Baer, both large players in the private banking industry that has thrived thanks to Swiss bank secrecy, were both down around 10 percent.

Swiss banks were underperforming a fall in the DJ Stoxx index of European banks, which was down 5.6 percent.

...

UBS agreed on Wednesday to pay a fine of $780 million and to disclose about 250 names of U.S. clients it said had committed tax fraud.

But U.S. tax authorities now wants thousands more names of citizens it says are hiding about $14.8 billion in assets in secret bank accounts.

PRESSURE MOUNTS

Swiss media described the UBS settlement as a capitulation for Switzerland, and experts said they expected it to weaken the country's bank secrecy rules.

A cartoon in Swiss newspaper Tages Anzeiger showed a safe symbolizing bank secrecy being pierced by a bullet carrying the name of the U.S. Department of Justice.

A second cartoon showed a huge rocket, labeled the U.S. tax authorities, coming at full speed while UBS Chairman Peter Kurer was quoted as saying that the bank was no longer a target.

"All of the Swiss banks are off. This is has to do with concerns about Swiss banking secrecy and whether other jurisdictions may follow the United States' example," said a London-based bank analyst.

Lawyers say the U.S. investigation will have implications for other offshore centers, which are also coming under pressure from cash-strapped western governments as the economic crisis deepens.

/... http://www.reuters.com/article/topNews/idUSTRE51J18920090220?sp=true

[MattSh]

52. UBS and Tax Havens...

A couple of comments here about UBS and tax havens.

1. I can't understand why anyone would still have the expectation that UBS would be a tax haven. They have operations in the US. So, why the expectation of privacy or a tax haven?

According to court documents, in 2000, after it purchased the brokerage firm Paine Webber , UBS voluntarily entered into an agreement with the IRS that required the bank to report income and other identifying information for its U.S. clients.

http://www.bizjournals.com/jacksonville/stories/2009/02/16/daily32.html

2. The world's biggest tax haven is the USA. That's as long as you're not a citizen or resident alien.

The world's biggest tax haven is the United States. We have very competitive tax and privacy laws for overseas investors, and this has helped attract more than $5 trillion of foreign capital to our economy. Other havens, such as Switzerland with $2 trillion and the Cayman Islands with less than $1 trillion, are minor league compared to America.

I don''t like quoting the Heritage Foundation, but this is something the mainstream media doesn't report, among many others. We help citizens of other countries evade their taxes.

http://www.heritage.org/press/commentary/ed100501.cfm

[Ghost Dog]

53. Re. your comment #2: Mainland UK is the world's second largest tax haven after the USA

The UK is the worlds second largest tax haven after the USA. Even during the worst years of old left wing socialist Labor government, the City's nominee to head the Bank of England got the job. Foreign nationals who held external accounts with UK financial institutions could trade tax free from London. Until the mid l990s the UK even had legislation permitting the registration of exempt international companies on the model of Cayman and the Isle of Man. The people in charge understood that to try to tax the international businessman would only result in the money flows going elsewhere. Those who could not vote with their feet would vote with their money.

Centuries of running an empire taught the British business and accounting practices which, while diplomatically giving lip service to taxing everyone, in fact gives rank its privilege. The US learned this lesson much later and only from the early 1980s exempted foreign nationals not resident in the US from tax liability on earnings from capital invested in the USA. Being a much larger economy, the US was able within the eight years of the Reagan administration to overtake the UK for the number one spot of the worlds tax haven. Nevertheless the UK is clearly number one in Europe and has the advantage of a more civilized approach then the USA. You can expect the police in London to give you a fair warning. The US authorities like to make test cases.

Substantial tax benefits accrue to UK residents who are not UK domiciled. It is possible for a non-UK national who has no UK capital or income to live indefinitely within the UK and legally avoiding paying any UK tax. This has resulted in London having a larger number of expatriate millionaires then the rest of Europe's capitals combined. This also explains London real estate prices and the UK's popularity as a corporate headquarters for firms investing into the EU. To this one must add the civility of the administrators and the advantage of speaking English.

/more info... http://www.lectlaw.com/filesh/bbg30.htm

(edited to correct grammar in the title).

[Demeter]

57. Jeez, Ask a Simple Question

and the whole world gets explained! I love this site. I love you all!

And Reagan is at the base, yet again. Perhaps BushCo thought to put the Swiss out of their primary business?

I'm having a paradigm shift here...

[Demeter]

55. Very Interesting! Thank You, MattSh!

Glad to see your post, too. Welcome to the club!

We ought to have initiation proceedings, or something.

[MattSh]

83. initiation?

It's not going to hurt worse than this economy, I hope. :)

[AnneD]

88. No.....

We try to save your wallet from serious injury.
Loved and miss your sector snaps. I just love a guy with snap.:evilgrin:

[radfringe]

11. Jobless hit with bank fees on benefits

Jobless hit with bank fees on benefits
Unemployed workers outraged over charges to inquire on benefits
updated 6:23 p.m. ET, Thurs., Feb. 19, 2009
AP/MSNBC
http://www.msnbc.msn.com/id/29286993/

First, Arthur Santa-Maria called Bank of America to ask how to check the balance of his new unemployment benefits debit card. The bank charged him 50 cents.

He chose not to complain. That would have cost another 50 cents.

So he took out some of the money and then decided to pull out the rest. But that made two withdrawals on the same day, and that was $1.50.

For hundreds of thousands of workers losing their jobs during the recession, there's a new twist to their financial pain: Even when they're collecting unemployment benefits, they're paying the bank just to get the money — or even to call customer service to complain about it.

---snip---

Neither banks nor credit card companies will say how much money they are making off the programs, or what proportion of the revenue comes from user versus merchant fees or interest. It's difficult to estimate the profits because they depend on how often recipients use their cards and where they use them.

But the potential is clear.

In Missouri, for instance, 94,883 people claimed unemployment benefits through debit cards from Central Bank. Analysts say a recipient uses a card an average of six to 10 times a month. If each cardholder makes three withdrawals at an out-of-network ATM, at a fee of $1.75, the bank would collect nearly $500,000. If half of the cardholders also call customer service three times in any given week, the bank's revenue would jump to more than $521,000. That would yield $6.3 million a year.

=============

is BoA now Bilking Of America?

[ozymandius]

13. Skank of America will try to nickle and dime its way to a meager profit.

So will the other banks, I'll wager. See my post #12.

[54anickel]

73. My sister e-mailed that article to me yesterday. Amazing how the states have taken a pass on their

"social responsibilities" to the individual to save a few pennies on the "budget". It always looks good on paper, on the ground, in the trenches of the real world - not so much. Recipients become faceless, worthless freeloaders to society as the no longer contribute to the dominate economic system but rather draw on it. You are part of society when you contribute, but once you begin to draw aid from any of the social programs - including social security - you're a free loader that needs to "pitch in" and do your part ($$$, taxes, fees, etc).

We are all here to serve the domination system instead of each other...so sad. Shouldn't it be the other way around - that the institutions serve us? Sadder yet to think we want to continue the system by propping up those very institutions that have enslaved us. Sure it will be painful to let them fail, but how much more painful to allow them to continue for generations to come.

[Hugin]

78. Those customer service reps better at least be in the US.

:grr:

[ozymandius]

12. U.S. Stock-Index Futures Drop; Citigroup, GM, WellCare Retreat

Feb. 20 (Bloomberg) -- U.S. stock futures fell, indicating the Standard & Poor’s 500 Index will extend its second straight weekly decline, as concern deepened government efforts won’t prevent the recession from worsening.

Citigroup Inc., the bank that got a $52 billion government bailout, and JPMorgan Chase & Co. fell at least 1.8 percent in Germany as Meredith Whitney forecast banks won’t continue to pay their existing dividends. General Motors Corp. slipped 1.5 percent. WellCare Health Plans Inc. dropped 4.1 percent after the care provider was ordered to stop enrolling new customers.

Futures on the S&P 500 expiring in March decreased 1.6 percent to 766.9 as of 9:39 a.m. in London. The index has tumbled 5.8 percent this week. Dow Jones Industrial Average futures fell 1.6 percent to 7,346 and Nasdaq-100 Index futures retreated 1.5 percent to 1,153.25.

....

Whitney, the financial industry analyst who left Oppenheimer & Co. yesterday to start her own firm, said she doesn’t expect the banks she covers to continue paying dividends at their current levels.

“Most of the big banks would be lucky to break even or earn a little bit of money this year,” Whitney said in an interview on CNBC Television.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aEkAMRFzTIWU&refer=us

[Roland99]

16. Looks scary out there this morning

[Demeter]

21. It's Also Bitter Cold, Again. And It Snowed

It's the February Funk.

[Roland99]

76. Good enough name for this bad cold i've had for 2 weeks now.

Although, today is the best I've felt all week.

[Demeter]

115. You May Have Had Influenza

Two weeks of near-death, 6 weeks of wanting to die while coughing lungs out. then it's over.

[AnneD]

136. I have started sending kids home with it.....

also have had a bad stomach virus floating around too.

[radfringe]

14. Sign of the Times? ABC cuts Oscar ad rates

ABC cuts Oscar ad rates
Los Angeles Times - 4 hours ago
http://www.latimes.com/entertainment/news/la-fi-oscarads20-2009feb20,0,3419456.story

This year, Oscar is a little less golden.

The ABC network, in a move that reverses years of escalating prices and underscores the worsening economy, has shaved the cost of a commercial for Sunday's annual Academy Awards show, one of TV's most-watched programs.

Once considered invincible to downturns, big events such as the Academy Awards and the Super Bowl, which attract tens of millions of viewers, can no longer command automatic rate hikes. NBC in January found itself peddling unsold commercial inventory in the Super Bowl just days before the big game. It even had to slash rates to attract last-minute sponsors.

Last year ABC sold commercial time in the Academy Awards show for as much as $1.8 million for a 30-second ad. Now, with the recession in full swing on top of five consecutive years of declining Oscar ratings, ABC has had to lower its rates. Individual spots have been selling for $1.4 million to $1.7 million.

[UpInArms]

15. dollar watch

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

Last trade 87.771 Change +0.367 (+0.47%)

US Dollar Extends Rebound as Stocks Sink Across Asian Exchanges (Euro Open)

http://www.dailyfx.com/story/special_report/special_reports/US_Dollar_Extends_Rebound_as_1235108543785.html

Japan’s All Industry Activity Index fell -2.7% as expected, bringing the annual rate of decline to -6.1% in the year to December. Predictably, the manufacturing component of the metric saw the largest decline, shrinking -20.7% from a year before on lackluster export demand. The services component, which accounts for over 60% of the index, shrank -2.9% as rising unemployment weighed on spending. Japan’s economy was confirmed to be experiencing the worst recession since the 1974 oil crisis after GDP shrank -12.7% in the year to the fourth quarter. The Bank of Japan Monthly Report echoed the language of yesterday’s interest rate announcement, saying “economic conditions have deteriorated significantly”. Although policymakers did not revise down their previously released growth and inflation forecasts, Governor Maasaki Shirakawa said that the outlook is “extremely uncertain”.

The US Dollar advanced as Asian stock markets resumed downward momentum, sending investors back into safe-haven assets. The MSCI Asia Pacific index slipped as much as -1.8%, weighed down by disappointing 2008 earnings reports from Bridgestone Corp (-71%) and Caltex Australia Ltd (-95%) as well as sharpened fears that the global recession will compound losses from unpaid loans. ANZ Banking Group said bad debts are spreading from “high-risk” to “mainstream” clients.

...more...

Markets Will Find Direction Soon As Traders Weigh Bailout Efforts Against Recession Forecasts

http://www.dailyfx.com/story/topheadline/Markets_Will_Find_Direction_Soon_1235095152351.html

Over the past weeks, policy officials have dramatically increased their efforts to stabilize growth and the financial markets. However, skepticism has so far prevented a recovery in sentiment and depressed asset values. Nonetheless, with so much pent up fundamental energy, the indecision on market direction will soon be resolved – for better or worse. Looking across the various asset classes, the picture is the same: price action positioned just off of major lows or highs and ready for trend revival or a permanent reversal. For the FX market, the DailyFX Carry Index continues to develop its wedge with a clear bias pointing towards fresh six year lows. This is a good gauge of general risk appetite in the world’s most liquid market; but the same conditions are certainly echoed through key currencies and pairs. For example, the dollar index is holding just below a three-year level of resistance; EURUSD has set the pace to overrun its October lows; and the yen crosses are stubbornly tethered to their recent record lows. What makes this a true turning point though is the fact that this sense of an imminent decision is seen in all corners of finance. Among the most notable are the Dow’s test of a six-year low, junk bond spreads showing signs of topping, and crude prices stabilizing around $35 per barrel.

So, which direction will the markets take? While technicals may have set the scene, fundamentals will ultimately decide the next phase, though the outcome is far from clear cut. In the end, it will all boil down to investor sentiment. Congestion that has developed in price action since October reflects a bearish market that has found some level of support from the world’s governments doing everything they can to turn growth around and thaw lending. The actions of world leaders this past week have shown the greatest sense of coordination since the financial and economic crisis began. In the US, a $787 billion stimulus package was passed, Treasury Secretary Geithner broadened the scope of the Financial Relief Program and President Obama promised $275 billion to stabilize the housing market. Beyond the boarders of the world’s largest economy, Australia passed its own government spending program, the Bank of Japan said it would mop up $11 billion in corporate debt, capital has been redistributed to fortify banks in Eastern Europe from downgrades and the largest European economies have made it known that they were prepared to bail out any fellow Union members should it be necessary. This combined push no doubt helps the global economy; but it doesn’t necessarily prevent the advance of painful recession. Indeed, even conservative forecasts suggest a bottom cannot be entertained until at least the third or fourth quarter of this year. Until then, bankruptcies, defaults, sovereign downgrades and tumbling yields will be constant threats. As such, investors will have to decide whether they will weather drawdowns for the long-term recovery in growth or stay on the sidelines until conditions improve.

...more...

[ozymandius]

19. "Until then, bankruptcies, defaults, sovereign downgrades ...."

"Until then, bankruptcies, defaults, sovereign downgrades and tumbling yields will be constant threats."

One aspect of this global bailout project that's still very puzzling to me: where is the money to buy the bonds to raise the cash coming from? Even private equity does not have that amount of cash-on-hand. Sovereign wealth funds around the globe are showing weakness through unintentional stress-testing.

It looks like the whole world is going broke.

[UpInArms]

22. we know that all of it was one giant ponzi scheme spinning

on a roulette wheel in some dark back room and it probably ended up in somebody's nose

the poppies are still growing in Afghanistan and the druglords are still running Columbia

the shuffle of money from wallets into the pockets of the few - the Madoffs and their buddies - "Sir" Allen and his goldplated heli

well, it seems to all have been spent on whores and popsicles and it's just "melted" away

'twas only an illusion anyway :sigh:

(edited because there's no "d" in Afghanistan)

[Demeter]

28. Nixon Killed the Gold Standard in 1971?

And it's been inflation ever since. So this year and the next we watch 38 years of paper wealth evaporate back into the ether from which it came.

If there's any justice, the bankers will all evaporate as well, as the US leads the way to stability not with gold, but with the colonial scrip that worked so well that George III was moved to outlaw it.

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

Imagine the entire wealth class knocked on its ass.

[Ghost Dog]

59. I suppose we ought to acknowledge the gold bugs' position:

<snip>

The seriousness of the situation is magnified by the rapidly increasing scale of the problem. Just today, the release of the latest minutes of the Federal Reserve confirmed that even that bastion of eternal optimism is sobering. The American economy, which shrank by 3.8 percent in the last quarter of 2008, is forecast to decline by some 5.5 percent in the first quarter of this year. In some pockets, the unemployment rate is already in double figures. Despite massive Government spending on rescue and stimulus, the American consumer clearly is becoming increasingly nervous, and the credit markets show few signs of recovery.

With bad news only getting worse, investment markets are turning into quagmires. The Dow Jones Average is testing new lows, and the commodities markets show few signs of life. In such times, the price of gold should fall along with the prices of other assets and commodities. But, the reverse has occurred. In the past two months, gold has staged a remarkable rally. This is despite the activity of price-depressants such as official gold sales by the IMF and official 'approval' for massive naked short positions to be opened by new 'bullion' banks.

Not only have gold spot prices risen in the face of such selling pressure, but the price of physical gold is now some $20 to $40 per ounce above spot. This would indicate that investors are now so nervous that they are insisting on taking physical delivery.

Make no mistake, the economy will not turn around soon. When the recovery fails to materialize, look for governments around the world, and especially in the U.S., to send another massive wave of liquidity downriver. When it does, the value of nearly everything, except for gold , will diminish.

/... http://www.financialsense.com/fsu/editorials/schiff/2009/0219.html

[54anickel]

92. Economic bubble, toil and trouble

http://www.sbsun.com/pointofview/ci_11734558

snip>

OK, the housing bubble had most of the required elements - cheap and abundant credit, lax lending standards, government policies that aggressively pushed homeownership, and overbuilding. The brew was mixed liberally with delusion, greed, criminality, and just plain stupidity. It needed just one more ingredient, a place to park all that risky debt.

The repeal of the Glass-Steagall Act allowed the shadow banking system - the virtually unregulated banking system comprised of investment banks and hedge funds - to reach stratospheric heights. It could meet the need. Mortgage-backed securities could be used to underwrite the home loans, even the junk. Securitization of mortgages was nothing new. What was new was the securitization of subprime loans made possible by a contraption called the collateralized debt obligation (CDO) "invented' in the mid-'90s and unleashed sometime around 2003.

But even these devices didn't go far enough for Wall Street. The investment houses found ever more clever and exotic ways to leverage money to increase their returns. The use of credit derivatives including credit default swaps exploded, dwarfing the underlying debt upon which they were based. The International Swaps and Derivatives Association (yes, there really is such a group) estimated the value of these devices at $62 trillion.

Credit default swaps and collateralized debt obligations were supposed to insure against risk. Instead, they became "weapons of mass destruction," in the words of Warren Buffett. Speculation went through the roof. The Bank of International Settlements estimated the notional value - that is the value of the underlying debt - of credit default swaps alone was $45 trillion.

But the fun didn't stop there. Because the issuance of derivatives is virtually unregulated (no pesky reserve requirements) extreme leveraging took notional values to several hundred times their capital. Indeed, the notional value of all derivatives reached almost $600 trillion, exponentially higher than the value of all economic activity on the planet.

To put this in perspective, the world's traditional banking system holds nearly $40 trillion (again, according to The Bank of International Settlements). The market capitalization of all the world's stock markets is roughly $51 trillion. All the bonds in the world are valued at $68 trillion. If this $600 trillion gorilla didn't faze the world's leading economists and policymakers, what would?

snip>

When our financial system is viewed from the bottom up it bears an uncanny similarity to a tried and true Ponzi scheme. Inexorable growth in the housing market simply had to come to an end and when it did the elaborately constructed edifice wobbled over. The housing bubble created the illusion of prosperity. Unfortunately, all too many had a vested interest in perpetuating the lie.

more...

[UpInArms]

94. Clinton ushered out the Glass-Steagall Act,

Clinton ushered out the Glass-Steagall Act, which for decades had separated commercial banking from investment banking, and signed the Commodity Futures Modernization Act — which exempted all derivatives, including the now notorious credit-default swaps, from federal regulation. His Administration also loosened housing rules, which put pressure on banks to lend in low-income neighborhoods.

"None of it was an endorsement of permissive lending and risk-taking," the magazine concluded. "But if you believe deregulation is to blame for our troubles, then Clinton earned a share too."

In a separate interview last weekend with CNN, Clinton allowed that his Administration could have done more to "set in motion some more formal regulation of the derivatives market," but he vehemently denied that the repeal of Glass-Steagall or his Administration's housing policies helped spur the financial crisis. Both interviews took place just hours after the Senate passed the $787 billion economic stimulus bill, which President Barack Obama is expected to sign into law on Tuesday.

Earlier in the NBC interview, Clinton told Curry that he agreed with the assessment of Dennis Blair, Obama's Director of National Intelligence, that the financial crisis has surpassed terrorism as the country's most significant near-term security concern. Clinton also gave the new President high marks for the way he has used his first month on the job. "I think off to a good start ... Given the fact that they had to do it in a hurry, and he had to deal with Congress and the inevitable compromises, I think he got quite a good bill out of this," Clinton said. "This package that he's going to sign is our bridge over troubled waters."

...more...

:hi: 54anickel! I sure miss you! :pals:

[54anickel]

100. The banking industry was pushing for that repeal since the 80's. The senate and house both

had more than enough votes to override a veto anyway - not that Clinton would have vetoed anyway. He was basically a Republican dressed as a centrist and run as a Democrat - but we've had that discussion hear several times over the years. Keeping Greenspin, touting NAFTA, moving the center so damned far to the right that old Democratic values and virtues are now considered far-left, commie-pinko, field. :eyes:

Miss you too! I'll leave you with a Lyle Lovett earworm.....
:loveya: :hippie: :hug:


Which way does that old pony run
Which way does that old pony run
And how much is that saddle
And a straight shooting gun
Which way does that old pony run

So this good life you know I must leave
Your new car
And your color TV
But what's riches to you
Just ain't riches to me
And if you're staying out here
Then I'm headed back east

Which way does that old pony run
Which way does that old pony run
And how much is that saddle
And a straight shooting gun
Which way does that old pony run

[clixtox]

27. Where is the cash coming from?

Same as ever!

Created out of somewhat thinner air than usual, currently!

[DemReadingDU]

47. that is what spouse says

He says the government will print whatever it needs. Except it needs about a quadrillion, an no printing press can print that fast.

[tclambert]

153. It's all about the Grovers, baby.

Grover Cleveland is on the $1,000 bill. Or maybe it's about the Woodrows. Wilson in on the $100,000 bill.

[DemReadingDU]

46. Ozy, the next sentence...

"Until then, bankruptcies, defaults, sovereign downgrades and tumbling yields will be constant threats. As such, investors will have to decide whether they will weather drawdowns for the long-term recovery in growth or stay on the sidelines until conditions improve. "

----
Personally, I don't ever see a recovery like what we had been used to, and I don't see conditions improving any time soon either. I am glad I no longer gamble in the stock market.

[natrat]

51. yea but a bounce from dow 5,ooo has to be good for a bunch

oh lord keep me away from the stock market

[Ghost Dog]

42. Process to consider euro zone help begun-Steinmeier

Fri Feb 20, 2009 5:50am EST BERLIN, Feb 20 (Reuters) - German Foreign Minister Frank-Walter Steinmeier said on Friday a process had begun to consider how economically strong euro zone countries could help other states, but it was too early to name specific measures.

"Especially an economy like the German one obviously relies on the economy of its neighbouring states and neighbouring markets not suffering too much," Steinmeier said after a meeting with Slovenian Foreign Minister Samuel Zbogar in Berlin.

/.. http://www.reuters.com/article/marketsNews/idINLK42261720090220?rpc=44

[Festivito]

18. Debt: 02/18/2009 10,789,925,775,196.76 (UP 142,014,855.35) (Teensy tiny.)

(If movement started yesterday, it certainly stopped today.)

= Held by the Public + Intragovernmental(FICA)
= 6,482,101,482,601.99 + 4,307,824,292,594.77
UP 178,127,394.43 + DOWN 36,112,539.08

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 305,825,915 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $35,281.27.
A family of three owes $105,843.8. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 33 days.
The average for the last 22 reports is 7,320,194,985.75.
The average for the last 30 days would be 5,368,142,989.55.
The average for the last 33 days would be 4,880,129,990.50.
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$/day.
There were 20 reports in 29 days of Obama's part of FY2009 averaging 0.02B$ per report, 0.05B$/day so far.
There were 95 reports in 141 days of FY2009 averaging 8.05B$ per report, 5.43B$/day.

PROJECTION:
There are 1,432 days remaining in this Obama 1st term.
By that time the debt could be between 12.8 and 18.6T$.
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)
02/18/2009 10,789,925,775,196.76 BHO (UP 163,048,726,283.68 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: 765,200,878,284.30 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
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 ------------********
02/09/2009 -000,572,980,736.98 --- Mon
02/10/2009 +000,388,825,726.33 ------------********
02/11/2009 -000,221,760,520.78 ---
02/12/2009 +043,810,585,841.25 ------------**********
02/13/2009 -000,268,428,512.00 ---
02/17/2009 +028,425,868,676.29 ------------********** Tue
02/18/2009 +000,178,127,394.43 ------------********

186,336,583,452.63 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,125,293,971,937.69 in last 153 days.
That's 1,125B$ in 153 days.
More than any year ever, including last year, and it's 111% of that highest year ever only in 153 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 153 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=3746341&mesg_id=3746468

[Festivito]

156. Debt: 02/19/2009 10,802,021,982,124.74 (UP 12,096,206,927.98) (12B$.)

(Like a Friday dump, but not an extravagant amount.)

= Held by the Public + Intragovernmental(FICA)
= 6,495,008,105,385.21 + 4,307,013,876,739.53
UP 12,906,622,783.22 + DOWN 810,415,855.24

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 305,832,086 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $35,320.11.
A family of three owes $105,960.32. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 23 reports in the last 30 to 34 days.
The average for the last 23 reports is 7,527,847,678.89.
The average for the last 30 days would be 5,771,349,887.15.
The average for the last 34 days would be 5,092,367,547.49.
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$/day.
There were 21 reports in 30 days of Obama's part of FY2009 averaging 0.07B$ per report, 0.09B$/day so far.
There were 96 reports in 142 days of FY2009 averaging 8.10B$ per report, 5.47B$/day.

PROJECTION:
There are 1,431 days remaining in this Obama 1st term.
By that time the debt could be between 12.8 and 18.6T$.
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)
02/19/2009 10,802,021,982,124.74 BHO (UP 175,144,933,211.66 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: 777,297,085,212.30 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
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 ------------********
02/09/2009 -000,572,980,736.98 --- Mon
02/10/2009 +000,388,825,726.33 ------------********
02/11/2009 -000,221,760,520.78 ---
02/12/2009 +043,810,585,841.25 ------------**********
02/13/2009 -000,268,428,512.00 ---
02/17/2009 +028,425,868,676.29 ------------********** Tue
02/18/2009 +000,178,127,394.43 ------------********
02/19/2009 +012,906,622,783.22 ------------**********

199,483,336,650.09 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,137,390,178,865.67 in last 154 days.
That's 1,137B$ in 154 days.
More than any year ever, including last year, and it's 112% of that highest year ever only in 154 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 154 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=3747988&mesg_id=3748026

[UpInArms]

24. SEC names Robert Khuzami new enforcement chief

http://news.yahoo.com/s/ap/20090220/ap_on_bi_ge/sec_enforcement_chief

WASHINGTON – The Securities and Exchange Commission on Thursday named a former federal prosecutor as its new enforcement chief to lead the embattled agency's drive to strengthen its pursuit of financial fraud.

Robert Khuzami has been a top legal official on Wall Street at investment firm Deutsche Bank since 2004. Before that he worked for 11 years in the U.S. attorney's office in Manhattan and prosecuted insider trading cases, Ponzi schemes and other financial crimes.

Khuzami, 52, replaces Linda Thomsen, the SEC enforcement director since May 2005. Her departure was announced last week.

Thomsen became a lightning rod for criticism over the SEC's failure to detect the $50 billion Ponzi scheme allegedly run by money manager Bernard Madoff, despite red flags raised to the agency staff by outsiders over the course of a decade.

"As head of the SEC's division of enforcement, the staff and I will relentlessly pursue and bring to justice those whose misconduct infects our markets, corrodes investor confidence and has caused so much financial suffering," Khuzami said in a statement.

His appointment by new SEC Chairman Mary Schapiro came two days after the agency accused Texas billionaire R. Allen Stanford in a civil lawsuit of a "massive" $8 billion fraud that lured investors with sham promises of double-digit returns on certificates of deposit. Stanford was found Thursday in Virginia, where FBI agents acting at the SEC's behest served him with legal documents. He was not arrested. Stanford has not been charged with any crime, though federal agents continue to investigate the case.

...more housecleaning at link...

[Demeter]

30. Yes, But Is He a Bushbot? A Bankbot?

Where do his loyalties lie?

[ozymandius]

35. New York Subpoenas Bank of America CEO on Merrill Bonuses (and Where is the SEC?)

From the fine folks at Naked Capitalism

The digging by the New York attorney general, Andrew Cuomo, into the bonuses paid by Merrill Lynch immediately prior to the closing of its acquisition by Bank of America, are starting to take an interesting turn.

The proximate cause is that the bonuses were unseemly and unwarranted, which doesn't form the basis for legal action., but was enough for New York and North Carolina to launch investigations. But New York is now starting to hit some pay dirt. From the Wall Street Journal:

Bank of America Chairman and Chief Executive Kenneth Lewis was issued a subpoena by New York State Attorney General Andrew Cuomo, who is investigating whether the bank withheld information from investors in violation of state law, according to people familiar with the matter.

Mr. Lewis, who received the subpoena late last week, is the highest-profile subject of Mr. Cuomo's investigation into the Charlotte, N.C., bank's purchase of Merrill Lynch & Co. on Jan. 1. Mr. Cuomo's office is trying to determine if investors were misled about the depth of Merrill's losses in late 2008 and whether details of the bonuses to Merrill employees, contained in a nonpublic document, should have been disclosed to investors....

In particular, they wanted to know why the September merger agreement contained a nonpublic attachment that outlined the maximum Merrill could pay.

....

So while we are glad to see someone going after securities fraud, this is hardly the most important instance. What about our favorite hobby horse, the obviously misleading financials published by Lehman before its collapse? And while Lehman is (hopefully) an extreme case, we have no doubt it has plenty of company. Cleaning up banks includes cleaning up their financial disclosure, and there seems to be perilous little progress on that front.

[Demeter]

31. I Cannot Tell a Lie--It's Friday!

And that means that the Weekend Economists will be convening sometime tonight after the market closes. Find us in the Editorial Forum!


Thank you, all those secret admirers who pledged to DU and sent me the hearts. I will take good care of them, and see that none are broken by my hand. I know it's silliness, but I am deeply touched by the thought.

Demeter

[Dr.Phool]

50. We appreciate all of your and Ozy's hard work.

WE and SMW make us all a lot smarter. I don't know another place to find all of this information.

And it's more accurate than you'll find anywhere else.

I love everybody here.

[antigop]

67. Kudos! Thanks to everyone, especially Ozy and Demeter, for your contributions every day. n/t

[JNelson6563]

54. Bravo!

Glad to see so many hearts here in the Stock Thread. I think you all are just great and I appreciate this convenient one-stop-shopping thread for econ news--I beleive many others do too.

Will check out the Editorial Forum as time permits.

Cheers,
Julie

[RUMMYisFROSTED]

69. Indeed!

[JNelson6563]

70. I heart RIF

Longtime fan here! :hi: :loveya:

[ozymandius]

137. Thank you. Thank you all.

I greatly appreciate all the love that has populated the area under my sig line. It is all very touching and humbling.

[UpInArms]

58. April gold at $998.50 an ounce on Globex

07. April gold at $998.50 an ounce on Globex
8:15 AM ET, Feb 20, 2009

[UpInArms]

61. Gold hits 11-mth high, eyes $1,000 on haven demand

http://www.reuters.com/article/goldMktRpt/idUSLK12882920090220?sp=true

LONDON, Feb 20 (Reuters) - Gold jumped to an 11-month high on Friday as risk averse investors bought the precious metal as a safe store of value, and analysts see it breaching $1,000 an ounce.

Spot gold <XAU=> struck a high of $992.30, its strongest level since March 19. At 1223 GMT it was at $992.00/994.00 an ounce against $973.75 in New York late on Thursday.

The metal is poised to rise further, possibly targeting last March's all-time high of $1,030.80 an ounce, analysts said.

"The rally we've seen in the last few days has been very much led by investment demand," Barclays Capital analyst Suki Cooper said.

"Investors aren't looking at the normal drivers -- they are sidelining the dollar strength, sidelining deflationary concerns and lower oil prices. They are very much buying gold as a safe-haven asset," Cooper said. "There is potential for us to breach the $1,000 level."

Meanwhile, U.S. gold futures for April delivery GCJ9 on the COMEX division of the New York Mercantile Exchange rose $17.30 to $993.80 an ounce. Earlier they hit $994.20 an ounce, their strongest since July 22.

Saxo Bank senior manager Ole Hansen said the deteriorating macroeconomic picture and inflows into exchange-traded funds were currently the main influences on the gold price, now that the metal's usual relationship with the dollar had broken down.

...more...

[UpInArms]

62. Gold futures for April delivery top $1,000 an ounce

01. Gold futures for April delivery top $1,000 an ounce
9:08 AM ET, Feb 20, 2009

[54anickel]

74. Watch for the smack-down....n/t

[UpInArms]

98. Gold ends above $1,000/oz for first time in nearly a year

http://www.marketwatch.com/news/story/Gold-ends-above-1000oz-first/story.aspx?guid=%7B22FC513A%2D7A59%2D4CE8%2DB665%2D907BB942182F%7D&dist=hplatest

NEW YORK (MarketWatch) -- Gold futures closed above the key $1,000 mark for the first time in nearly a year on Friday, as global financial and economic worries boosted the safe-haven appeal of the precious metal. Gold for April delivery finished at $1,002.20 an ounce, up $25.70, or 2.6%, on the day. It earlier touched a high of $1,007.70. With rising fear that the U.S. government may nationalize some banks, blue-chip stocks hit fresh bear-market lows Friday, with the Dow Jones Industrial Average ($INDU: 7,317.25, -148.70, -2.0%) down recently 155 points, or 2%, at 7,306. Among other metals, March copper futures fell 5 cents, or 3.4%, to end at $1.42 a pound.

thank everybody for all these great hearts - I love you all right back!

:grouphug:

[UpInArms]

63. Boeing issues 1,100 layoff notices

http://blog.seattlepi.nwsource.com/aerospace/archives/162417.asp

About 700 Boeing workers in the Puget Sound area are set to receive 60-day layoff notices Friday morning as part of Boeing's plan to reduce its commercial work force in the region by about 4,500 jobs this year.

They are among 1,100 employees that will get the notices Friday, the company said.

Boeing has said it expects to reduce employment companywide by about 10,000 positions this year through layoffs, attrition and by not filling open positions. It will also cut back on contract labor.

The cuts are the result of an industry downtown that has become even worse than after the Sept. 11, 2001, terrorist attacks.

A Boeing spokesman said more 60-day notices will follow each month as employment drops to the previously announced levels.

Those receiving notices Friday will be laid off April 24. About 750 of them work in Boeing's commercial airplanes business, which has business units in several states other than Washington..

The unions representing Boeing engineers and Machinists will be notified Friday what jobs are being cut. SPEEA, the union that represents Boeing engineers, has previously said that it belves about half the layoffs will be in the Shared Services Group, based in Renton, with about a third from Boeing's military division in the region.

...more...

[UpInArms]

64. 9:33 EST very red opening

Dow 7,338.27 127.68 (1.71%)
Nasdaq 1,424.87 17.95 (1.24%)
S&P 500 766.89 12.05 (1.55%)
10-Yr Bond 2.745% 0.112

NYSE Volume 332,504,687.5
Nasdaq Volume 118,123,539.062

09:21 am : S&P futures vs fair value: -15.60. Nasdaq futures vs fair value: -17.30. Market participants prepare to begin the trading session with broad-based weakness. The downward bias comes after the Dow closed the prior session at its lowest level since 2002. The rather portentous close, combined with existing concerns and negative headlines, is exacerbating weakness in overseas markets, which is now being fed upon by U.S. traders. However, since the prior session’s close didn’t come with much conviction, investors will monitor the intensity of early pressure and whether stocks can shake off the weakness. There hasn’t been much data to convince investors they should come of the sidelines and bid stocks higher, though. Financials remain a primary area of concern, positioning Bank of America (BAC) and Citigroup (C) to open at fresh multiyear lows. Shares of BAC were quoted at $3.59 per share in premarket trading, while C was quoted at 2.26 per share in premarket trading. In earnings news, Lowe's (LOW) reported earnings that missed expectations, and issued downside guidance. LOW is trading 4% lower at $16.30 per share in premarket trading. JC Penney (JCP) beat earnings estimates, but forecast a deeper loss than analysts are projecting. Shares of JCP were quoted 1.8% lower at $14.65 per share in premarket trading. Barrick Gold (ABX) has garnered interest ahead of the opening bell by topping earnings estimates; its shares were recently trading 3.2% higher at $37.60 per share in premarket action. Its shares Last evening, Intuit (INTU) announced better-than-expected earnings, and issued in-line guidance. INTU is expected to open the session roughly 4.4% higher near $22.20 per share, based on premarket trading prices. Economic data was light this morning. January consumer prices were largely in step with expectations.

09:00 am : S&P futures vs fair value: -13.20. Nasdaq futures vs fair value: -13.80. Foreign markets are trading lower, feeding upon weakness exhibited by U.S. stocks in the prior session. In Europe, Germany's DAX is down 3.5% amid broad-based weakness. Of the 30 companies listed in the DAX, only one, Fresenius Medical, is trading with a gain. The company recently reported an increase in net profits. Meanwhile, France's CAC is off by 2.9%; it is also trading with broad-based weakness. Axa is a primary laggard this session. Axa is down as downbeat broker notes weigh on its shares. The company's latest results have also failed to alleviate fears of a capital raise by the company. Britain's FTSE is down 2.3%. Anglo American (AAUK) is under pressure after reporting a lower profit, along with plans to cut its dividend and workforce. Energy stocks like BP PLC (BP) and Royal Dutch Shell (RDS.A) are also under pressure. In Asia, the MSCI Asia-Pacific Index closed 2.1% lower. Japan's Nikkei closed 1.9% lower as bank shares stumbled and a weaker yen failed to lift exporters. Mitsubishi UFJ Financial (MTU) was a key laggard. Hong Kong's Hang Seng closed 2.5% lower as heavyweight HSBC (HBC) fell to its lowest level in 10 years. HSBC fell as concerns about worse-than-expected earnings and recapitalization grew.

[KoKo]

65. Annette Nazareth is the leading candidate to become deputy U.S. Treasury secretary

(Not quite sure what to think about her....on first read she seems to have been part of the problem) :eyes:

http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aUHcpBQ4ocXk

By Rebecca Christie and Robert Schmidt


Feb. 20 (Bloomberg) -- Former Securities and Exchange Commission member Annette Nazareth is the leading candidate to become deputy U.S. Treasury secretary, according to people familiar with the matter.

If nominated and approved by the Senate, Nazareth would be second-in-command to Treasury Secretary Timothy Geithner, the only Treasury official confirmed in the Obama administration’s first month. Now a partner in the Washington office of law firm Davis Polk & Wardwell, Nazareth would likely work on Treasury’s campaign to toughen financial-market supervision.

Nazareth has “a wealth of knowledge both in the private sector and government, so she’s certainly well qualified for the position,” said John Olson, a partner at the Gibson, Dunn & Crutcher law firm in Washington.

Nazareth, a Democrat, left the SEC in January 2008. As a commissioner, she focused on systemic risks that securities firms and traders such as hedge funds pose to financial markets. Nazareth, 53, participated in 2007 in an SEC review of whether Wall Street investment banks set strict enough limits on the loans they make to hedge funds.

Senator Charles Schumer, a New York Democrat and member of the Banking and Finance committees, helped secure Nazareth’s SEC seat and has been pressing the Obama administration to give her a role at Treasury, said one of the people.

-snip-

Regulatory Role

She was also a driving force in urging a merger of the NASD, an industry-funded regulator of U.S. brokerages, with most of the New York Stock Exchange’s regulatory arm. The SEC approved consolidation, which formed the Financial Industry Regulatory Authority, in July 2007.

Before becoming a commissioner in 2005, Nazareth ran the SEC division of market regulation, which oversees brokerage firms, market surveillance and stock exchanges. She led the unit in 2004 when it designed a program to monitor whether Wall Street’s five biggest securities firms had adequate capital and liquidity.

SEC Inspector General David Kotz faulted the program in a September report, saying the SEC failed to respond to “numerous, potential red flags” at Bear Stearns Cos., such as the firm’s excessive borrowing and over-concentration in mortgage securities.

Legal Work

Nazareth has done legal work for the Securities Industry and Financial Markets Association, Wall Street’s biggest lobbying group. She is married to Roger Ferguson, former Federal Reserve vice chairman and now president and chief executive of retirement-plan manager TIAA-CREF.

[antigop]

68. Citi paid out more in dividends, buybacks from 2003 to 2007 than it got from TARP

http://www.bloomberg.com/apps/news?pid=20601039&sid=aoDAkaaW0y9c

If we want banks to store nuts for winter, let’s prevent them from paying out too much in dividends and share buybacks during good times. Those outlays wouldn’t lead to games with earnings that can give investors a false sense of comfort.

Consider that between 2003 and 2007 Citigroup Inc. paid out about $44 billion in dividends and about $22 billion buying back stock. The combined outlay is about four times more than its current market value, and much more than what the government has shelled out to keep the bank afloat.

Little Faith

A little restraint back then might have left Citi in better shape today. Instead, investors wind up with little faith in banks’ books. Their numbers are so dubious that Treasury Secretary Timothy Geithner now wants special stress tests to figure out which banks can survive without more government handouts.

What’s amazing is that after all this, bankers want even more leeway over reserves for potential soured loans, one of the most subjective areas of the balance sheet. That’s because these estimates involve guesswork about borrowers and economic conditions, now and in the future.

Some bankers believe onerous rules regarding the way these reserves are calculated prevented them from building up enough of a buffer before the current crisis exploded.

The problem is these reserves can easily be used by banks to manage their numbers, or manipulate earnings.

[antigop]

71. Phil Gramm says loose money and politicized morgages caused the financial crisis (not deregulation)

Op-ed in the WSJ--adapted from a recent paper he delivered at the American Enterprise Institute
http://online.wsj.com/article/SB123509667125829243.html

The principal alternative to the politicization of mortgage lending and bad monetary policy as causes of the financial crisis is deregulation. How deregulation caused the crisis has never been specifically explained. Nevertheless, two laws are most often blamed: the Gramm-Leach-Bliley (GLB) Act of 1999 and the Commodity Futures Modernization Act of 2000.

GLB repealed part of the Great Depression era Glass-Steagall Act, and allowed banks, securities companies and insurance companies to affiliate under a Financial Services Holding Company. It seems clear that if GLB was the problem, the crisis would have been expected to have originated in Europe where they never had Glass-Steagall requirements to begin with. Also, the financial firms that failed in this crisis, like Lehman, were the least diversified and the ones that survived, like J.P. Morgan, were the most diversified.

Moreover, GLB didn't deregulate anything. It established the Federal Reserve as a superregulator, overseeing all Financial Services Holding Companies. All activities of financial institutions continued to be regulated on a functional basis by the regulators that had regulated those activities prior to GLB.
...

Since politicization of the mortgage market was a primary cause of this crisis, we should be especially careful to prevent the politicization of the banks that have been given taxpayer assistance. Did Citi really change its view on mortgage cram-downs or was it pressured? How much pressure was really applied to force Bank of America to go through with the Merrill acquisition?

Restrictions on executive compensation are good fun for politicians, but they are just one step removed from politicians telling banks who to lend to and for what. We have been down that road before, and we know where it leads.

Finally, it should give us pause in responding to the financial crisis of today to realize that this crisis itself was in part an unintended consequence of the monetary policy we employed to deal with the previous recession. Surely, unintended consequences are a real danger when the monetary base has been bloated by a doubling of the Federal Reserve's balance sheet, and the federal deficit seems destined to exceed $1.7 trillion

See--it's not my fault. I'm not to blame. REALLY. It's those other guys.

[54anickel]

102. Didn't deregulate anything? I don't think that's what Phil was saying back then....

http://banking.senate.gov/prel99/1112gbl.htm

snip>

"In the 1930s, at the trough of the Depression, when Glass-Steagall became law, it was believed that government was the answer. It was believed that stability and growth came from government overriding the functioning of free markets.

"We are here today to repeal Glass-Steagall because we have learned that government is not the answer. We have learned that freedom and competition are the answers. We have learned that we promote economic growth and we promote stability by having competition and freedom.

"I am proud to be here because this is an important bill; it is a deregulatory bill. I believe that that is the wave of the future, and I am awfully proud to have been a part of making it a reality."

[antigop]

72. Krugman: Against Stupidity (John Boehner smackdown--HA!)

http://krugman.blogs.nytimes.com/2009/02/20/against-stupidity-2/

The most valuable lesson I learned from the year I spent in Washington (1982-1983, on the staff of the Council of Economic advisers — I was the senior intl economist, the senior domestic economist was a guy named Larry Summers. What ever happened to him?) was the extent to which senior government figures have absolutely no idea what they’re talking about.

So when I read something like this:

“Why should we reward Fannie Mae and Freddie Mac with $200 billion in taxpayer dollars without first reforming these housing entities that were at the heart of the economic meltdown?” House Minority Leader John A. Boehner (R-Ohio) said in a statement.

and people ask what on earth Boehner might mean when he talks about taxpayers “rewarding” institutions that are owned by taxpayers, I go for Occam’s Razor: Boehner doesn’t have some complicated notion in mind, he either doesn’t know that the government took over F&F months ago, or he just doesn’t get this “government-owned” concept.

[CatholicEdHead]

75. Best Buy to let go a net 40 more people at corporate headquarters

http://www.startribune.com/business/39854562.html

Best Buy Co. Inc. laid off 250 workers at its Richfield corporate headquarters Thursday but said it would create 210 new positions for which affected employees could apply.

Spokeswoman Susan Busch said the company would wait until its March earnings report to announce the cost savings for what amounts to a net loss of 40 jobs.

The company, which is the nation's largest consumer-electronics retailer, now has slashed 13.5 percent of its corporate workforce in recent months as sales at its more than 1,175 stores have plunged.

About 500 employees left the company on Feb. 12 after taking a voluntary buyout that was offered to all 4,000 workers at the corporate campus on Penn Avenue that overlooks Interstate 494. No store workers have been part of the layoffs.

[skoalyman]

77. I see all the banks are heading down the hill in a flaming basket

ta-ta key corp:evilgrin: http://chart.bigcharts.com/custom/wsjie/US/big.chart?sid=4506&time=1yr&freq=1dy&ma=1&maval=200&lf=1&country=US&wtype=64&ClientID=46140&mocktick=1&page=us&style=1252&size=1&type=64&symb=KEY&rand=3435

[DemWynner]

132. Wanna bet the new positions

Pay less! That may not be a bad thing. maybe now the CEO position can be filled by 2 people that make about half and do the same thing the CEO does.

[Ghost Dog]

80. Britain invites Africa, poorer Asia nations to G20

Fri Feb 20, 2009 12:32pm GMT LONDON (Reuters) - Representatives from Africa and poorer Asian nations have been asked to attend the G20 financial crisis summit in London on April 2, British Prime Minister Gordon Brown said on Friday.

Brown has asked the New Partnership for Africa's Development, the Association of South East Asian Nations and the African Union Commission to send delegates to the summit.

That will give a voice at the meeting of leading developed and emerging economies to less wealthy countries across Africa and Asia such as Nigeria, Cambodia and Vietnam.

One of Brown's key aims for the summit is to make international institutions such as the World Bank and International Monetary Fund more representative by giving more power to developing nations.

...

Brown's office said it had also issued formal invitations to leaders from Argentina, Australia, Brazil, Canada, China, current European Union presidency holders Czech Republic, France, Germany, India, Indonesia, Italy, Japan, Mexico, the Netherlands, South Korea, Russia, Saudi Arabia, South Africa, Spain, Turkey, the United States and the EU Commission.

The April 2 summit is likely to mark Barack Obama's first trip to Europe as U.S. President.

/... http://af.reuters.com/article/topNews/idAFJOE51J0G620090220

So that makes 25, unless I'm miscounting.

[54anickel]

89. Pardon my mistrust, but is this some sort of bribe? "...by giving more power to developing nations."

[54anickel]

93. Oh look, a new heart. Thank you to my secret admirer. I don't make it onto DU or the SMW much

anymore so I am so happy to be remembered. :grouphug:

[54anickel]

134. So what's this - Putin steals the show at Davos? This IS getting interesting.....

Bit if a goldbug rant....sorry. But it does lend another possible reason for the sudden attempt to widen the circle of friends of the World Bank and IMF.

http://www.kitco.com/ind/willie/feb202009.html

snip>

The World Economic Forum took place in Davos Switzerland last week. The global picture enabled a nice snapshot of sentiment, fault for the crisis, blame doled out, the vacuum of leadership, the perks for blunderers in a country club setting (instead of prison), and warnings on a potential situation that could spiral out of control. Amidst all the finger pointing, surprisingly little blame was given to themselves, the corporate chieftains in attendance. Let’s be clear! The Davos Forum was a funeral wake, and Putin rode in on a white horse to announce there is a new sheriff in town!! Davos afforded a unique opportunity for Russian self-styled leader Vladimir Putin to storm the forum stage and to steal the show. Putin presented a basic Blueprint for what should be called ‘The Post-US World’ as the United States and United Kingdom have lost the mantle of leadership and control. They lost it from failed economic policy, wrecked banking systems, fraud-ridden bond markets, corrupted debt ratings agencies, abuse of IMF & World Bank, and the severe backfire of economies that depended upon housing bubbles. Inflation turned on its haughty financial engineers! Nations with insolvent banks, insolvent households, corporations in liquidation, economies in near collapse, they tend not to be good owners and custodians of the global reserve currency!!!

Davos provided a flashpoint for a profound change in global leadership. The whimpering US-UK-EU bankers have been shamed. Then after the finger pointing, insults, hand wringing, and gut wrenching, Putin rode in on a white horse carrying a banner. Chinese Premier Wen Jiabao provided the confirmation to what Putin laid out, like a second of a formal motion. Wen Jiabao proceeded from the Davos stage to four European capitals to seal the new path and its legitimacy. The barter system has been launched in quiet, while the Western press continues not to comprehend a ruptured status quo limping along. It cannot; it will not; the transition is on. Not only will the USDollar not provide the global highway for all to travel, but new barter systems will be dominant soon in working around the commodity price systems dominated by the US-UK corrupt price discovery systems. The other painful consequence to the new system soon taking root is that the global commodity supply routes will bypass the US destinations, enough to create mammoth shortages. Such is the fate of a nation thrust to the Third World. Its people and its leaders still do not realize it, as denial is ensconced in hope. The US credit supply has already been severed and cut almost completely off. Reliance upon the printing press to finance its own debts is a primary trait of a Third World nation, a shocking fact soon to be recognized.

snip>

BRITISH LEAVE US MEMBERS TO TAKE THE HEAT

The message behind the actions was extremely loud. Chancellor of Exchequer Alistair Darling and Foreign Minister David Millibrand decided to cancel their trip to Davos. They stated publicly that certain people they wished to meet at Davos had canceled their trip and would not attend. They stated publicly about how affairs in the United Kingdom were pressing, the emergency too important to leave home. What a crock! The only guests who canceled their trips were the British. Perhaps the UK delegation planned to attend Davos and only meet among themselves. The nixed meetings planned with attendees might have been dominated by angry European Union finance ministers. Europeans are launching Currency War salvos at the British. Maybe the British did not want to be the subject of broad European criticism. The other important consequence of the British canceled plans was that the members of the Untied States contingency were left all alone, exposed to take the heat of criticism. The US & UK were united when they ruled the roost from corrupt platforms. They are divided as they fall.

PUTIN STOLE THE SHOW

The Russians realized the vacuum of banking and political leadership. Vladimir Putin took the high road actually. His criticism of the US failure and corruption was implied. He let the decimation of Wall Street firms, their colossal losses, and their calamitous fall from grace speak for themselves. He would not permit anyone in attendance to yack about how Putin droned on and on about US failure. Failure is painfully obvious for almost all to see. He skipped over much direct criticism to offer solutions, a sign of leadership. No, Putin was the only bright spot in Davos. Putin offered a Blueprint for the next decade, for the ‘Post-US World’ where the US-UK corrupt tag team does not control the helm or sit at the catbird seat. Vladimir Putin and Dmitry Medvedev served as dominant figures over a gloomy forum. A Putin spokesman actually told reporters “This is Davos under the Russian flag.” More accurately, the Davos Forum gave Russia, and to some extent China, a chance to exert leadership.

snip>

PUTIN CRITIQUE OF GLOBAL FAILURE

Putin openly questioned the reliability of the USDollar as a global reserve currency. He all but said it is dead in the water for that role. He called the one reserve currency a danger to the world economy, in fact! He acknowledged that globalization has multiplied the destructive force, so that the US-UK crises have touched all nations and everyone. To be sure, other nations are epicenters for crisis like Spain. Several nations are feeling the impact of the shocks from the crisis epicenters, like Germany, Russia, and China. Some specific criticism was given. Putin talked about the disproportion between the scale of financial operations and fundamental value of assets. That means huge US-UK financial flows in trading centers against a backdrop of miniscule current valuation of the bank centers. The US & UK bank sectors are insolvent. Putin talked about the differences between the increased burden of international loans and source collateral. That means the Western nations, led by the US & UK, but also Southern Europe, have outsized debt burdens against a backdrop of near nil collateral, a stark trait of insolvency, if not bankruptcy. Putin attacked indirectly the Untied States for printing money with abandon, consuming what Asian factories produce, while Asians respond by saving money in the form of government debt securities. Putin warned the global leaders not merely to treat the symptoms, which is precisely what they are doing, but to work toward serious reform.

Putin warned of blind faith in the omnipotent power of states, and the distorted concentration of assets in the hands of the states. That might be a slap at the central bankers, who are serving as quasi-bank systems unto themselves in a desperate action. Their biggest new ledger item is Dollar Currency Swap. Putin warned that unbridled growth of budget deficits and public debts is destructive. In essence, Putin urged a return to free enterprise principles. The Western leaders are moving toward socialism and fascism. What irony that former KGB leader from the Soviet Union was lecturing the West on the benefits of embrace for capitalism and free enterprise!!! :crazy:

[Ghost Dog]

158. To which one might add, now: Clinton says appreciates China confidence in US debt

Fri Feb 20, 2009 11:52pm EST BEIJING, Feb 21 (Reuters) - U.S. Secretary of State Hillary Clinton said on Saturday the United States greatly appreciated the Chinese government's confidence in U.S. treasuries.

Clinton, speaking at a news conference during a trip to China, also said she hoped a G20 summit in London in April would yield agreement on cross border capital flows.

/.. http://www.reuters.com/article/marketsNews/idINPEK32176320090221?rpc=44

There is a wealth of meaning behind these statements, I reckon...

[54anickel]

159. Sucking up trying to make up for Tim-may's yuan outburst?

I agree, a wealth of meaning behind these statements indeed.

[Blue_Tires]

84. lots of great info in this thread

i got to start reading the stock market thread more often!

[Renew Deal]

86. The Stock Market thread is always a must read on DU

It's guaranteed to have lots of interesting info!

[CatholicEdHead]

96. It is always a daily read for me

[Renew Deal]

85. Lookout below!

:hide:

[AnneD]

87. Fun with other DU'ers......

Just got an email from Katrina in Germany. Even thought he could not travel to her town in Germany-he did contact her and hopefully mailed her a package I had sent (ex pat care packages are always nice to get). They had a good chat via phone. I have had the pleasure of meeting a few DU'ers and have always had pleasant experiences. Hubby was a bit skeptical, but he is always game for a new adventure and he enjoyed it too. Just thought you'd like to know what a nice group of folks frequent this thread and site.:loveya:

[Roland99]

90. 1:24pm - OMG!

DJIA 7,270.01 -195.94 -2.62%
Nasdaq 1,419.61 -23.21 -1.61%
S&P 500 756.89 -22.05 -2.83%
Global Dow 1,270.34 -38.22 -2.92%
Dow Util 331.54 -12.77 -3.71%
NYSE 4,727.13 -154.03 -3.16%
AMEX 1,313.13 -38.40 -2.84%
Russell 2000 403.55 -13.16 -3.16%
Semcond 193.88 -1.55 -0.79%
Gold future 1,005.00 +28.50 +2.92%
30-Year Bond 3.50% -0.19 -5.02%
10-Year Bond 2.69% -0.17 -5.81%

Citi was at $1.68/share a min ago. Bank of America about $2.83/share. GE down to $9.09/share (Lowest level since summer 1995). Kraft at all-time low since going public in 2001.

[Renew Deal]

95. Are we going to have a Friday night shutdown of Citibank?

It seems like they are ready to go.

[Demeter]

114. That Would Be Something!

think of the bailout money we'd save! Enough for popcorn, surely! :popcorn:

[Renew Deal]

133. While bankrupting the FDIC!

I bet it would go to the bailout money. Pay everyone off and liquidate.

[MilesColtrane]

91. Citigroup down 29.88%

Bank of America down 28.24%

[MilesColtrane]

103. "Nevermind"

Bank of America: -16.54%
Citi: -20.75%

[UpInArms]

97. Madoff trustee: No securities bought for customers in 13 years

http://www.marketwatch.com/news/story/Madoff-trustee-No-securities-bought/story.aspx?guid=%7BE3029229%2D16E5%2D4CB7%2D8ED2%2DE9584C10B391%7D

NEW YORK (MarketWatch) -- The trustee liquidating Bernard Madoff's investment firm says his investigation has found no evidence that any securities were purchased on behalf of customers in at least 13 years.

Speaking at a meeting Friday morning of Madoff's customers, the trustee, Irving Picard, said the firm's customers can recover up to the $500,000 they're entitled to under the Securities Investor Protection Act. Customers who've lost more than that amount can also share in assets recovered by the trustee.

Picard was appointed under the Securities Investor Protection Act, which governs failed brokerages. He is liquidating Madoff's firm, Bernard L. Madoff Investment Securities LLC. Picard said he's received claims from 2,350 customers so far.

Madoff was arrested in December. He has allegedly admitted to running a massive Ponzi scheme that cost his investors as much as $50 billion.

...more...

[TheWatcher]

99. Yes, Another Magical Stick Save is now in Progress.

For those wondering what could possibly be fueling this, I think I may have found a clue.

Source: dowjones

13:58 DJ White House says privately-held bank system "the correct way to go"; "strongly believe" in private banking system

13:54 DJ White House says markets not reacting only to admin's actions; markets are pricing in a variety of information

Curiously the Market began it's Meteoric Rise right after that story came out. I suppose the Marching Orders to The Black Boxes with the Sticky F12 Keys were given at that moment.

Yes, The White House Believes in the Banking System, so the Bottom Is In.

Get the story out there, calm the herd, Goose the market, get the Goebbels Cheerleaders to Wave the Pom Poms about how "Resilient The Market is being in the face of all this Bad News"....

Nationalize after The Close, over the weekend.

Economic Fascism 101.

Perception Is Everything. Reality means nothing.

Can they pull of Another Green Day?

Who cares? The Reality for me and you will stay the same.

[UpInArms]

101. 2:36 EST - looks like a fight to keep it at 7400

Dow 7,387.97 77.98 (1.04%)
Nasdaq 1,440.46 2.36 (0.16%)
S&P 500 770.00 8.94 (1.15%)
10-Yr Bond 2.737% 0.12

NYSE Volume 6,755,287,000
Nasdaq Volume 1,752,650,250

2:35 pm : The major indices rally, with the Nasdaq now posting a slight gain, as two headlines lift give a large boost to financials. Dow Jones reported that the White House saidprivately-held bank system "the correct way to go" and that it "strongly believes" in private banking system.

Meanwhile, Bank of America (BAC 3.49, -0.44) gets an added boost as Rochdale Financial Analyst Richard Bove , on CNBC, says "Bank of America is one of best buys he's ever seen on the NYSE."

Financials were down as much as 9.0% compared to their current loss of 2.5%.DJ30 -68.54 NASDAQ +0.23 SP500 -8.07 NASDAQ Dec/Adv/Vol 1893/775/1.73 bln NYSE Dec/Adv/Vol 2490/625/1.36 bln

2:00 pm : Stocks are pulling off their session lows, but losses remain deep and widespread. Seven of the 10 sectors in the S&P 500 are trading with losses in excess of 1%.

Education stocks have been standing out amid the broad declines. Career Education (CECO 23.01, +3.35) is leading the way after reporting better-than-expected earnings results. It did disclose that its preliminary cohort default rate was up modestly in 2007 from 2006. Concerns regarding substantially higher cohort default rates sent shares of for-profit education companies lower in the prior session. Education services stocks are currently up 3.6% as a group.DJ30 -155.16 NASDAQ -18.96 SP500 -17.99 NASDAQ Dec/Adv/Vol 2072/586/1.51 bln NYSE Dec/Adv/Vol 2774/337/1.19 bln

[TheWatcher]

112. BINGO! I knew it. Another Magical Jawboning Saves The World Price Adjustment

That does indeed look like what's going on.

They are trying to set the Price at 7400. Mustn't Boil The Frog too quickly now!

You know, I guess we shouldn't really worry about the economy or the effects it's deterioration could have on us anymore.

All we have to do is wait for someone to spew Happy Talk and everything will be Magically Fixed!

C'mon Black Boxes, Hedge Funds, Trading Desks, Big Money Center Banks, Hot Money Scumbags, GO ALL IN!

The Perception Pumps are going FULL BLAST!

:rofl:

Meanwhile, Millions continue to be unemployed, Nothing has changed, And our leaders babble Fantasy Talk to goose the Markets and pad Wall Street Pockets.

Change We Can Believe In?

It's beginning to look like the only Change that really took place was the Bird Cage Liner.

By the way, another indication we may have a short term floor here,

About the same time "The White House Believes" Story came out, Cramer was gurgling and weeping about how terrible everything was and that people should get their money out and not buy for Five Years!

The Cramer Fade-O-Matic works yet again!

[Hugin]

113. "for-profit education companies"

Soooo... The Student-Loan-Shark Diploma Mills for-profit education companies are in the gravy. (for the time being)

Neil Bush will be pleased. :eyes:

[AnneD]

106. From our Kick'em when they're down department.....

States issuing jobless benefits debit cards

For hundreds of thousands of workers losing their jobs during the recession, there's a new twist to their financial pain: Even as they're collecting unemployment benefits, they're paying bank fees just to get access to their money.

Thirty states have struck such deals with banks that include Citigroup Inc., Bank of America Corp., JPMorgan Chase and US Bancorp, an Associated Press review of the agreements found. All the programs carry fees, and in several states the unemployed have no choice but to use the debit cards. Some banks even charge overdraft fees of up to $20 — even though they could decline charges for more than what's on the card.

"It's a racket. It's a scam," said Rachel Davis, a 38-year-old dental technician from St. Louis who was laid off in October. Davis was given a MasterCard issued through Central Bank of Jefferson City and recently paid $6 to make two $40 withdrawals.

The banks say their programs offer convenience. They also provide at least one way to tap the money at no charge, such as using a single free withdrawal to get all the cash at once from a bank teller. But the banks benefit from human nature, as people end up treating the cards like all the other plastic in their wallets.

more.....

http://www.chron.com/disp/story.mpl/ap/business/6272886.html

I couldn't see this happening during the depression because, frankly my Great grandpa and Grandpa would not have put up with it and neither should we-esp since we are bailing these ass wipes out :grr:

[AnneD]

117. As joblessness rises, so does banks' fee mongering

As joblessness rises, so does banks' fee mongering


Last week, I mentioned that state Rep. Scott Hochberg had introduced a bill to impose new restrictions on pay cards, which many employers now use instead of paychecks. One of Hochberg's concerns was that Texas uses such cards to pay unemployment benefits.

So do 29 other states. As the number of Americans collecting unemployment rises to record levels, this presents a big money-making opportunity for banks that administer the card programs. Coincidentally, some of those banks are also the biggest recipients of federal bailout money, and also engaged in a litany of leverage -- from debt securities to special investment vehicles -- that fed our current economic crisis.

As the Associated Press notes:

Thirty states have struck such deals with banks that include Citigroup Inc., Bank of America Corp., JP Morgan Chase and US Bancorp, an Associated Press review of the agreements found. All the programs carry fees, and in several states the unemployed have no choice but to use the debit cards. Some banks even charge overdraft fees of up to $20 — even though they could decline charges for more than what's on the card.

"It's a racket. It's a scam," said Rachel Davis, a 38-year-old dental technician from St. Louis who was laid off in October. Davis was given a MasterCard issued through Central Bank of Jefferson City and recently paid $6 to make two $40 withdrawals.

more....

http://blogs.chron.com/lorensteffy/

[AnneD]

122. I've been reading this for a while and decided to share........

Five Dumbest Things on Wall Street: Feb. 20

Try to duck it, Donald. You got fired.
Trump Entertainment Resorts(TRMP Quote - Cramer on TRMP - Stock Picks) filed for Chapter 11 bankruptcy protection Tuesday. The casino operator had assets of about $2.1 billion and total debts of about $1.74 billion on Dec. 31, 2008, it said in its filing with the U.S. Bankruptcy Court in New Jersey. Nine affiliates of the casino operator, including Trump Plaza Associates, Trump Marina Associates and Trump Taj Mahal Associates also sought protection, according to the filing.

skip......

Japan's Finance Minister Shoichi Nakagawa caroused himself right out of a job this week.
Nakagawa announced he was stepping down Tuesday because of health problems after facing allegations he was publicly drunk at last weekend's Group of Seven finance ministers meeting in Rome.

skip....

It turns out Wall Street has its own version of The Dark Knight.
Securities and Exchange Commission agents raided the Houston office of Sir Robert Allen Stanford on Tuesday, charging that the Knighted Texas billionaire fooled clients into pouring money into three of his companies with bogus promises of outsized returns. The SEC alleges that Stanford orchestrated a "massive" scheme revolving around $8 billion worth of certificates of deposit that promised "improbably and unsubstantiated high interest rates."

skip...

Apple's Big Brother Act

not only wants to control your tunes, but now your taste as well.
Apple rejected an iPhone application from the animated comedy series South Park this week, calling its content "potentially offensive," according to the show's Web site. The Emmy-award winning series, well known for its off-color humor, first submitted the App back in October, but at this point the idea is "dead in the water."

skip....

GM's Saab Story

GM DOWNSweden's government is not buying General Motors'(GM Quote - Cramer on GM - Stock Picks) Saab story and neither are we.
Sweden's industry minister on Wednesday blasted GM for saying that its Saab unit could face bankruptcy unless it receives government funding from its homeland. Maud Olofsson said she was "incredibly disappointed" in America's largest automaker and was adamant that GM, not the Swedish government, was responsible for Saab's future.

More....

http://www.thestreet.com/story/10465016/5/five-dumbest-things-on-wall-street-feb-20.html

Hope you enjoy some good humour in the afternoon. As I said-tis is a fav weekly wrap up .

[54anickel]

118. ...

See my post #73 in reponse to Rad's #11 above
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3747988&mesg_id=3748369

[AnneD]

125. I watched Cinderella Man yesterday......

and two things stuck in my mind......

1) the Hooverville in Central Park

2) the broker friend that tried to organize them to fight back.

[specimenfred1984]

108. Dear Propagandabots: Please use the term "Nationalization" instead of "Socialism"

It's so much easier for the dumbed-down population to comprehend as they yap on their cell phones in their SUVs while smoking a cigarette and flipping the bird at another motorist for not running a red light.

[Demeter]

116. Stolen From katty: Gone in 60 Days: Citi and Bank of America Won’t Live to See May

http://www.chartingstocks.net/2009/02/gone-in-60-days-c... /

Gone in 60 Days: Citi and Bank of America Won’t Live to See May
Thursday, February 19, 2009 16:21

Posted in category BAC, Bailout, C, Media, Special Reports, Stock MarketCitigroup (C) and Bank of America (BAC) won’t live to see May. The government will take them over within the next 60 days. The announcement may come as soon as tomorrow evening.

If there’s one thing our readers know, it’s that ChartingStocks.net has made some bold calls in the past which seemed controversial and highly unlikely at the time. Our January 2007 post warned of the coming stock market crash at a time when the market was making new all time highs. In February 2007 we warned about the breakdown of the brokerage stocks and singled out Bear Stearns (Trading at $160), Merrill Lynch (Trading at $87), and Morgan Stanley (Trading at 78). In September 2007, we warned of a selloff in the coming weeks. The market peak and decline began 4 weeks later.

We’re going to make another bold prediction. Bank of America and Citigroup won’t live to see May. The two banks will be nationalized in the coming weeks, and we think that the announcement can come as soon as tomorrow evening (Friday evenings are when major bank announcements and failures occur).

[TheWatcher]

119. Now, Now Demeter Didn't you get the 2PM Memo? "THE WHITE HOUSE BELIEVES"

Source: dowjones

13:58 DJ White House says privately-held bank system "the correct way to go"; "strongly believe" in private banking system

13:54 DJ White House says markets not reacting only to admin's actions; markets are pricing in a variety of information

All Propaganda aside though, I think Nationalization will occur Within the time frame indicated here.

As for today, it's another Price Adjustment day. It appears TPTB and their Black boxes have decided the 7400 level is what The Market MUST be priced at, so no further adjustments will be allowed at this time.

:)

[Dr.Phool]

120. I was going to post this morning, I didn't think they'd make spring.

But, I'm just an optimist.:crazy: :silly: :crazy:

[ozymandius]

138. What do you make of this?: Citibank has cut all lending in Denmark

This comes from the Danish daily Berlingske Tidene. It suggests that Citibank is cutting back all international lending. Citigroup has sold its German operations to a French bank and I understand they are cutting credit lines in the UK as well. In seeing all these stories together, one gets a full view of the kind of cutbacks now ongoing at troubled banks like Citigroup.

Update: 20 Feb 2009 1552EST: I have yet to see confirmation as to whether ‘cutting’ credit lines means reducing or stopping new credit availability. It is also unclear whether this is credit under the ‘quick and easy loan’ programme or under all Citibank activities. I will update the post accordingly when that information is available.

http://www.creditwritedowns.com/2009/02/citibank-has-cut-all-lending-in-denmark.html

[ozymandius]

140. Bank Of Countrywide Lynch and Citi in Full Panic Denial Mode

Both out with rose-colored releases to CNBC: Citi claiming its capital base is strong and it continues to streamline business (coach class tickets likely to be verboten as well soon), while BAC claiming there is no reason to nationalize a bank that is profitable, well-capitalized and has the coolest office furniture this side of Sir Stanford's corner office cum cricket field.


Some other pessimism porn:

* Alcoa at lowest since 1988
* GE at lowest since 1995
* Kraft all time lows since 2001 IPO
* Boeing at lowest level since 2003
* GM lowest since the first great depression

http://zerohedge.blogspot.com/2009/02/bank-of-countrywide-lynch-and-citi-in.html

---

Grandiose claims often attempt to hide rot.

[ozymandius]

141. Citi Stock Being Heavily Sold by Employees in Asia

You can't blame all the pressure on Citi on evil short sellers and the credit default swaps market. From Dow Jones, via Clusterstock (hat tip reader Tim):

Many bankers in the US believe nationalization of banks in general and Citi in particular is not on the agenda, but staffers in Asia, far away from the twists and turns of the national debate over how to secure the US banking system, are selling in great numbers because they fear the value of the equity they received as part of their retention and compensation would evaporate if the government were to decide to take over Citi, sources inside the company say.

http://www.nakedcapitalism.com/2009/02/citi-stock-being-heavily-sold-by.html

[TheWatcher]

121. Meanwhile, Back In The REAL WORLD

You know, the one you and I live in, where there are no Black Boxes or Soothing Language to line our pockets with cash between 2-4 PM:

Volcker: Crisis may be even worse than Depression
Fri Feb 20, 2009 2:58pm EST

NEW YORK (Reuters) - The global economy may be deteriorating even faster than it did during the Great Depression, Paul Volcker, a top adviser to President Barack Obama, said on Friday.

"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," Volcker said.

(Reporting by Pedro da Costa and Kristina Cooke; Editing by Theodore d'Afflisio)

http://www.reuters.com/article/politicsNews/idUSTRE51J5JM20090220?feedType=RSS&feedName=politicsNews&rpc=22&sp=true

[Dr.Phool]

124. And Volcker is as old as dirt.

Even older than McCain!

[TheWatcher]

126. Yes He Is.

And hey, if there is anyone who can compare The Great Depression to now, it's him.

He grew up during it. :)

[Dr.Phool]

123. ArcelorMittal Cleveland could remain down for six months or longer, plant manager says

ArcelorMittal Cleveland could remain down for six months or longer, plant manager says
Posted by Frank Bentayou/Plain Dealer Reporter February 20, 2009 15:00PM
Categories: Manufacturing, Real Time News

Its blast furnaces cold since October, ArcelorMittal's Cleveland facility could remain virtually shut down for another six months or longer, the steel plant's general manager said Friday.

Two-thirds of the plant's salaried employees soon will receive temporary assignments at ArcelorMittal plants in other states, the company said Friday. And a union official said perhaps hundreds more hourly workers could be laid off within a month.

Global demand for finished steel dropped significantly in the fall. Since then, the company has idled about 450 hourly workers at the sprawling plant in the Flats.

Terry Fedor, ArcelorMittal's local general manager, said Friday that the world's largest steel company will be shifting about 200 of his plant's 300 salaried employees to other U.S. facilities by early March.

"We won't be laying any salaried employees off. They'll be on temporary assignment" at plants in West Virginia and Indiana, Fedor said. "But 'temporary assignment' can mean a long time. These will be six-months assignments," he said.

With the job cutbacks Fedor and union leaders described as imminent, there's little likelihood that the plant's blast furnaces could restart anytime soon.

(more)
http://blog.cleveland.com/business/2009/02/arcelormittal_cleveland_could.html

[TheWatcher]

128. My, My, THAT certainly didn't last long.

Hey, Black Boxes, Working Group, Where You Going!

Didn't you get the Memo?

"The White House BELIEVES!"

YOU HAVE YOUR ORDERS!

Sheesh, It's getting harder and harder to find good help these days.

Maybe The Market decided that Volcker made more sense.

Ah well, we still have 15 minutes to get back to 7400.

Not to worry, there must be SOME rumor out there ready to get things going again.

Bueller?

[Dr.Phool]

129. Faerie dust didn't work. Couldn't climb to 7400.

[TheWatcher]

131. Not only that, But Ended the Day Down A Psychologically Uncomfortable Triple Digits

It's getting harder and harder for them to Sell this BS and turn it into Rallies and Price Adjustments.

Things are getting bad, my friend, all jesting and ranting aside.

I'm with you.

Nationalization Soon.

God Help Us All. :(

[specimenfred1984]

154. I think the corrupt are doing a lot of their business in Globex now

The DOW was down 124 at 4am eastern U.S. time Friday morning so closing down 100 was actually up from where it was trading on Globex. Globex is a lot easier to manipulate and sends an early signal to the rest of the world what the corrupt are doing. In Germany they mentioned nationalizing their banks then, whadda cowinkydink, the U.S. is talking about it, denying it all the way.

Personally I'm glad the entire corrupt structure is collapsing, it served no one but the super elite.

[TheWatcher]

130. Aaaaand THAT'S A WRAP! Here's Today's "Yes, This Is How Stupid We Think You Are" Headline

Reuters
Bank unease drag on stocks, but White House Soothes
Friday February 20, 3:49 pm ET

By Ellis Mnyandu

NEW YORK (Reuters) - The Dow and the S&P 500 fell on Friday, pummeled by worries about the lack of details on the U.S. government's bank rescue plan, though the S&P pulled back from the brink of a 12-year low after the White House said it supported a privately held banking system.

ADVERTISEMENT
Fears that some major banks could be nationalized had earlier driven the Dow to more than six-year lows. The White House made its comments after the chairman of the Senate Banking Committee, Christopher Dodd, said it might be necessary to take control of some banks.

The White House comments helped pull the Nasdaq near break-even, and shares of Bank of America (NYSE:BAC - News) and Citigroup (NYSE:C - News) , the day's laggards, quickly pared losses. Bank of America briefly turned positive, after having been down more than 30 percent earlier.

"Earlier, we were selling off because you had Sen. Chris Dodd scaring people with talk about nationalization. Then, you had the White House press secretary say that a privately held system is the way to go," said Neil Massa, senior U.S. trader at MFC Global Investment

More Vomit Inducing, intelligence Insulting Pap at the link:

http://biz.yahoo.com/rb/090220/business_us_markets_stocks.html

Never Believe Anything until it's OFFICIALLY DENIED.

Nationalization Coming Soon To A Land Of They Thought They Were Free Near You.

"BANK" On It.

[UpInArms]

135. end of a bloody week - numbers and blather

Dow 7,365.67 100.28 (1.34%)
Nasdaq 1,441.23 1.59 (0.11%)
S&P 500 770.05 8.89 (1.14%)
10-Yr Bond 2.772% 0.085

NYSE Volume 9,483,252,000
Nasdaq Volume 2,566,463,000

4:30 pm : The stock market was down more than 3% before rallying late in the afternoon as fears for the banking system were calmed.

Stocks had been under heavy selling pressure since the start of the session. Weakness was underpinned by concern that two of the nation's largest financial services companies, Bank of America (BAC 3.79, -0.14) and Citigroup (C 1.95, -0.56), may have to be taken over by the government. Though a Bank of America spokesman defended the company's health, concerns remained as Senator Dodd suggested that nationalization of a bank may happen.

Shares of C and BAC fell to new multiyear lows, dragging the financial sector more than 9% lower.

Financials rallied all the way back into positive ground after word surfaced that the White House believes the correct way to run the bank system is through private ownership, which likely helped calm fears of bank nationalization.

There is also speculation Treasury will soon release further details of its financial stability plan, though a spokesperson wouldn't comment.

Financial stocks were further helped by rumor that bank investor JC Flowers is buying preferred shares in big banks, specifically BAC. BAC was also called one of the best buys ever seen in the NYSE by an analyst on CNBC.

The positive developments induced short-sellers to cover their positions, helping the financial sector turn higher. The broader market rallied in response.

The Dow and the S&P 500 both made their way to the session's unchanged mark, while the Nasdaq turned positive.

The move proved unsustainable, though. All three major indices finished with a loss. The Dow set a new multiyear closing low; the prior closing low was set Thursday.

The Nasdaq Composite incurred the least severe decline of the headline indices, thanks to support from large-cap tech names. The strength in large-cap tech helped the Nasdaq 100 finish the session 0.4% higher.

Still, financial stocks continue to represent the biggest concern for the broader market, and will continue to do so in the coming week.

Lowe's (LOW 15.86, -1.12) traded lower after reporting earnings that fell short of estimates, along with downside guidance. JC Penney (JCP 15.10, +0.08) beat earnings estimates, but forecast a deeper loss than analysts are projecting. Their reports received little attention by the broader market.

The January CPI data didn't contain too many surprises as total CPI was up 0.3%, in-line with expectations, while core CPI was up 0.2% versus the consensus estimate that called for a 0.1% increase. Share volume was high this session.

More than 2 billion shares traded hands on the NYSE this session, but that was largely due to this being an options expiration day. DJ30 -100.28 NASDAQ -1.59 NQ100 +0.4% R2K -1.4% SP400 -0.8% SP500 -8.89 NASDAQ Dec/Adv/Vol 1924/788/2.15 bln NYSE Dec/Adv/Vol 2341/766/2.12 bln

3:30 pm : Gold garnered some of the strongest attention from commodities traders this session. Contracts for April delivery settled the session with gold priced at $1002.20 per ounce. That reflects a jump of 2.6% from the prior session's close.

Silver also attracted investors seeking safety. Contracts for March delivery closed the session with silver priced at $14.49 per ounce. Silver gained nearly 4% from the prior session's closing price.

Crude oil prices succumbed to continued selling pressure. Crude futures contracts for March delivery closed pit trading at $39.30 per barrel, which reflects a fractional loss from the prior session. March crude futures contracts expired at the close of pit trading.

April crude futures ended the session at $39.90, which is actually a dime more than where the contracts closed the prior session.

Natural gas contracts closed the session at $3.99 each. Natural gas closed the prior session at $4.06 per contract. Before this session, 2002 was the last time natural gas contracts traded for less than $4 each. DJ30 -129.83 NASDAQ -8.57 SP500 -13.51 NASDAQ Dec/Adv/Vol 1924/770/2.15 bln NYSE Dec/Adv/Vol 2511/596/1.67 bln

and in case someone missed my "heart" felt gratitude for all the hearts

[TheWatcher]

139. Bank Of America a Screaming Buy After Hours.....Up 11%!!!!!11111

Bank of America’s Lewis Says Bank Doesn’t Need Aid

Feb. 20 (Bloomberg) -- Bank of America Corp. doesn’t need more government aid and has enough “capital, liquidity and earnings power to make it through this downturn on our own,” Chief Executive Officer Kenneth Lewis said in a memo today to employees.

“Bank of America does not need any further assistance today, and I am confident we will not need any further assistance in the future,” Lewis said in the memo. Spokesman Scott Silvestri confirmed the memo’s authenticity.

Bank of America and Citigroup Inc., which received a combined $90 billion in U.S. aid in the past four months, tumbled today in New York Stock Exchange trading on concern they may be nationalized. They pared losses after the Obama administration said today a “privately held” banking system is the “correct way to go.”

In his memo, Lewis said he told about 100 senior Bank of America executives yesterday, “We have a clear challenge in front of us: to prove the cynics and the critics wrong.”

:rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl::rofl:

More Side-Splitting Stand Up Comedy At the Link:

http://www.bloomberg.com/apps/news?pid=20601103&sid=aSpX4aPEOUIU&refer=us

Do they all just get Scripts e-mailed to them and read them at the pre-determined time?

This is just childish at this point.

Stocks can only be moved up by Psychology, it seems. Maybe if we all hold hands and only say positive Platitudes Over And Over, Dow 14,000 will return by April. :eyes:

What do we need a Stimulus Bill for? Just broadcast Happy Talk!

[ozymandius]

143. Any more of that bravado and someone will fit him with clown shoes.

As I said in a previous post: Grandiose claims often attempt to hide rot.

[TheWatcher]

144. I was just speechless when I read that.

It kind of looked something like this:

:wow:

BELIEVE me ozy, I have that Story Bookmarked and Copied And Pasted into Word, and I plan to Cross-Post it to the PLANET when Nationalization finally takes place.

I remember some time ago, I can't remember if it was here on DU or one of the Bear Chat Boards, but someone collected a great montage of jaw-dropping statements and Quotes from the Great Depression.

You can be sure when someone gathers quotes from this one decades from now, you will find the one from this article in the Top 5.

This is just astounding.

[ozymandius]

145. I just found this bit of speculative wisdom at DailyKos.

Citibank and BofA...to be closed soon?

I just had a very disturbing conference call. Or rather, had a very non-call

It reminds me of a meeting I didn't have in last fall, or more accurately a meeting I had with myself, as no one else was left standing.

And if I am correct about the meaning of the meeting I just had.

Citibank and Bank of America are insolvent, and are being "swedished" aka disolved and sold off, coming this weekend.

What happenned last fall?

Let's start by what the CEO of Fortis said on Friday Sept. 26th.

......

Which brings me to the call I just had. A long scheduled call. No one on the call from BofA. And only a junior level guy I have never heard before from Citibank who had no clue about the nature of the project and didn't even understand some the subjects on the agenda for the call. I asked what his background is.

He's a lawyer.

[TheWatcher]

149. Wow. I just read that whole thing.

And here is the Punch Line:

'No chance' of Fortis going bankrupt: CEO
Sep 26, 2008
THE HAGUE (AFP) — There is "not a single chance" that Belgian-Dutch banking and insurance group Fortis will go bankrupt, its chief executive officer Herman Verwilst said Friday.
"There is not one single chance that we will face issues in that respect," he said when asked of the possibility of bankruptcy during a telephone conference with media.

We know what happened after that. Overnight. With NO WARNING.

Contrast that with what Lewis said today.

BAC is FINSIHED.

It may or may not not happen this weekend, but it's coming.

If I'm wrong, I'm wrong.

I wish I was.

[ozymandius]

150. certainly does rhyme with past events

not a single chance...I am confident we will not need any further assistance in the future...

It's simple pantomime at this point.

[ozymandius]

147. This line stands out.

"the mortgage unit is processing record levels of loans"

Better than, say, 2006 levels?

I say that quote is a load of bullshit.

[TheWatcher]

148. It's COMPLETE Bullshit.

The game seems to be to say and do whatever it takes to Pacify the Public to keep them from Panicking as long as possible.

If the Public At Large knew how bad things really were, The White House wouldn't have any "Soothing Talk" to Gurgle Out on the Tele-Screens, because Nationalization would be the first thing you heard about on the News.....In December of LAST YEAR.

Judging from the sentiment I see on The Web and Off, I must unfortunately report they seem to be doing their job pretty well. :( The Public seems to be pacified.

For Now.

There ARE rumblings and whispers in The Meadow.

They aren't going to be able to hide the rot much longer.

April is coming.

And who knows, Nationalization could happen at any time at this point.

[DemReadingDU]

155. They know it's coming, the collapse

All they are doing is delaying the inevitable.
Why? I think they are trying to transfer more of our tax dollars into another bailout which ultimately ends up in their pockets.

[agincourt]

142. Is this an engineered depression?

The only thing that makes the market go up are higher unemployment figures.

[TheWatcher]

146. It only goes up on Psychology.

This afternoon they almost pushed it into the Green With the White Houses' "Soothing Talk" about Nationalization.

We can call it "The White House BELIEVES" Rally.

Then Volcker says That things are deteriorating at an alarming rate and this could turn out to be worse than the Great Depression, and all of a sudden things start plummeting again.

Now Bank Of America is flying upwards After Hours because The CEO said that they don't need any more help.

Meanwhile, in the real World, Nothing has changed.

But it would seem that Wall Street gets pretty aroused by layoffs as well.

Didn't we have a huge rally recently because of REALLY bad Employment Numbers?

I may need to do some digging to find the exact date, but I think there was some sort of 250+ Point Party over that.

One thing is for sure. This Market DOESN'T respond to Technicals, Fundamentals, or anything Real anymore.

You may as well get in the car and Drive to Tulalip Casino here in Washington or take a weekend Junket to Vegas. At least the House is more Honest about Fleecing you there. And you get Comps!

[Demeter]

152. Volcker Always Had that Effect on the Markets, IIRC

[lovuian]

160. yes they want totally control of the money markets

they want control of the Banks our bank acounts and then they are going to tell you what to do and when to do it