STOCK MARKET WATCH, Wednesday March 3

[ozymandius]

Source: du

STOCK MARKET WATCH, Wednesday March 3, 2010

Bush Administration Officials Convicted = 2
Name(s): David Safavian, James Fondren

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

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

AT THE CLOSING BELL ON March 2, 2010

Dow... 10,405.98 +2.19 (+0.02%)
Nasdaq... 2,280.79 +7.22 (+0.32%)
S&P 500... 1,118.31 +2.60 (+0.23%)
Gold future... 1,137 +19.00 (+1.70%)
10-Yr Bond... 3.61 +0.00 (+0.06%)
30-Year Bond 4.56 +0.01 (+0.18%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie, Silver and US$

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Handy Links - Market Data and News:
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    Brad DeLong    Bonddad    Atrios    goldmansachs666    The Stand-Up Economist

Handy Links - Government Issues:
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This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.

Read more: du

[ozymandius]

1. Today's Reports

07:30 Challenger Job Cuts YoY Feb
Briefing.com NA
Consensus NA
Prior -70.4%

08:15 ADP Employment Change Feb
Briefing.com -35K
Consensus -20K
Prior -22K

10:00 ISM Services Feb
Briefing.com 51.3
Consensus 51.0
Prior 50.5

10:30 Crude Inventories 2/26
Briefing.com NA
Consensus NA
Prior 3.03M

14:00 Fed's Beige Book Mar

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

[Roland99]

54. Private sector sheds 20,000 jobs, ADP says

http://www.marketwatch.com/story/private-sector-sheds-20000-jobs-adp-says-2010-03-03?dist=beforebell

[mrdmk]

65. With ADP's track record you can multiply that number by 3 or 4

and come up with the real job loss!

Why the media uses ink and takes up space for the ADP report is beyond me, they always low-ball actual numbers...

[Po_d Mainiac]

68. spot on!

The last number was -60K REVISED from -22K

They just toss out numbers to bump the bubble a bit larger, and the markets play lemming. No cliff ahead, nope, right on coarse. :grr:

[ozymandius]

2. Oil hovers below $80 on mixed US supplies report

SINGAPORE – Oil prices hovered below $80 a barrel Wednesday in Asia after a crude inventory report gave mixed signs about U.S. demand. ...

U.S. crude inventories grew more than expected last week, the American Petroleum Institute said late Tuesday. Crude stocks jumped 2.7 million barrels while analysts had expected a rise of 1.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

However, distillate supplies, which include heating oil and diesel, dropped 4.1 million barrels while gasoline inventories rose by 900,000 barrels. ...

In other Nymex trading in April contracts, heating oil rose 0.23 cent to $2.058 a gallon while gasoline gained 0.11 cent to $2.1977 a gallon. Natural gas jumped 2.6 cents to $4.734 per 1,000 cubic feet.

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

[ozymandius]

3. Senate returns to business tax break measure

....
Tuesday night's vote to approve stopgap legislation extending a host of programs, including highway funding, generous health insurance subsidies for the unemployed and benefits for the long-term jobless, gives Congress time to consider the far larger measure covering most of the same programs. ....

Kentucky Republican Jim Bunning held up action for days. He wanted to force Democrats to find ways to finance the bill so it wouldn't add to the deficit, but his move sparked a political tempest that subjected Republicans to withering media coverage and cost the party politically. Bunning's support among Republicans was dwindling, while Democrats used to being on the defensive over health care and the deficit seemed to relish the battle. ....


Rather than winning the fight over funding the bill, Bunning eventually settled for a vote to close a tax loophole enjoyed by paper companies that get a credit from burning "black liquor," a pulp-making byproduct, as if it were an alternative fuel. The amendment failed.

Dick Durbin of Illinois, the Senate's No. 2 Democrat, said Bunning was accepting an offer he had rejected for days.

http://news.yahoo.com/s/ap/20100303/ap_on_bi_ge/us_budget_impasse

[ozymandius]

4. Senators seek to block stimulus money for overseas

WASHINGTON – A group of Democratic senators is urging the Obama administration to suspend an economic stimulus program aimed at financing renewable energy, complaining that money is going to projects that are creating jobs in foreign countries.

The four senators, led by Chuck Schumer of New York, wrote to Treasury Secretary Timothy Geithner on Tuesday to request a moratorium on the Recovery Act program. They asked that the moratorium remain in place until they can pass legislation mandating stimulus aid flow only to projects which preserve and create U.S. jobs. ...

While some of the grants go to foreign-owned companies, the administration argues that more than half the components, measured by their value, are built in this country and all the energy projects are installed in this country.

Last fall, a joint venture was announced involving China's Shenyang Power Group, Cielo Wind Power LP of Austin, Texas, and a private equity firm, U.S. Renewable Energy Group, to build a $1.5 billion Texas wind energy project. Because the wind turbines are to be manufactured in China, Schumer wrote to Energy Secretary Steven Chu last November urging him to reject federal funding for the project.

http://news.yahoo.com/s/ap/20100303/ap_on_bi_ge/us_stimulus_foreign_jobs

[wordpix]

72. not that witholding stim $ from the likes of China is a bad idea, but looky here:

http://www.washingtonpost.com/wp-dyn/content/article/2010/03/01/AR2010030103975.html

Nuclear projects face financial obstacles

By Steven Mufson
Washington Post Staff Writer
Tuesday, March 2, 2010

Hopes for a nuclear revival, fanned by fears of global warming and a changing political climate in Washington, are running into new obstacles over a key element -- money.

A new approach for easing the cost of new multibillion-dollar reactors, which can take years to complete, has provoked a backlash from big-business customers unwilling to go along.

Financing has always been one of the biggest obstacles to a renaissance of nuclear power. The plants are expensive, and construction tends to run late and over budget. The projected cost for a pair of proposed Georgia plants would be $14 billion; the Obama administration last month pledged to provide them with $8.3 billion in federal loan guarantees.

So utilities have turned to state legislators and regulators to help contain capital costs. In states such as Georgia, Florida and South Carolina, utilities have won permission to charge customers for some of the cost of new reactors while construction is still in progress -- a financing technique that would save utilities a couple of billion dollars for each reactor. Previously, utilities had to wait until power plants were in operation before raising rates, as they still do in most states.

more...

The point being, the O admin is pledging billion$ in loan guarantees for just one state, and what's to ensure these corps. won't default and leave us holding the bag---and needing to finish the project, to boot?

[ozymandius]

5. Asian stocks rise amid Greece hopes; Europe down

...Worries about Greece's ability to stabilize its finances have eased in recent days amid speculation European leaders will orchestrate a bailout and the government will take needed steps to reduce its mountain of debt. ...

European markets were lower ahead of Greece's announcement, with Britain's FTSE 100 and Germany's DAX off 0.2 percent. Wall Street futures pointed to a slightly stronger open in the U.S. Wednesday.

In Japan, the Nikkei 225 stock average edged up 31.30 points, or 0.3 percent, to 10,253.14.

South Korea's Kospi was up 0.5 percent at 1,622.44 and Hong Kong's Hang Seng lost 0.1 percent to 20,876.79.

Elsewhere, Australia's market rose 0.7 percent, lifted by news the local economy grew at its fastest pace in nearly two years, signaling that the country has emerged from the worst of the global crisis.

http://news.yahoo.com/s/ap/20100303/ap_on_bi_ge/world_markets

[ozymandius]

16. Greece Announces $6.6 Billion in Budget Cuts to Seek EU Support

March 3 (Bloomberg) -- Greek Prime Minister George Papandreou announced an additional 4.8 billion euros ($6.6 billion) of deficit cuts as he tries to convince European allies and investors that he can tame the region’s biggest budget gap.

The measures include higher tobacco, alcohol and sales taxes that seek to raise 2.4 billion euros in revenue, said Deputy Citizen Protection Minister Spyros Vougias after a Cabinet meeting in Athens to pass the plan. The government will also cut by 30 percent three additional salary payments civil servants receive at holiday times, a move union leaders have already warned will spark new protests.

Greece is signing up to even greater austerity measures after EU leaders called for Papandreou to adopt additional cuts before allies would come to its aid. The announcement comes as Papandreou prepares to meet Germany’s Angela Merkel on March 5 and French President Nicolas Sarkozy on March 7 to discuss its financing woes. Greek bonds advanced for a fourth day today on the prospect that the deficit measures might lead to EU help. ...

Today’s measures are the equivalent of 2 percentage points of GDP, about half Greece’s pledged deficit reduction for this year. The package includes raising the main value added tax to 21 percent from 19 percent and increasing alcohol and tobacco taxes for a second time this year. Civil servants will also see the reduction in benefit payments increased to 12 percent from the 10 percent in the original plan.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aJ0Rx2GgolNk&pos=1

---

This may be a silly question: Does this mean that Goldman Sachs still wins?

[Demeter]

24. It Doesn't Mean that GS Loses

and that's what the world really needs...

[Demeter]

6. Japanese fret over quality of manufacturing

http://www.ft.com/cms/s/0/5a94bb78-261c-11df-aff3-00144feabdc0.html

Toyota’s recall of 8.5m cars, trucks and sports utility vehicles in recent months has shocked Japan, home of manufacturing innovations such as the kaizen philosophy of continuous improvement and “total quality management”.

But while there is little evidence that Japan has got worse at making things – in spite of fretting triggered by Toyota’s recalls – quality has become a big problem for Japanese companies.

Japan’s challenge is that, while its factories still work well, the nature of products, the scale on which they are sold and where they are made have all changed.

Cars and gadgets have become more complicated, with engineers forced to specialise. Yoshinori Iizuka, a Tokyo University professor, said: “There are fewer and fewer people who understand how all the parts work together”.

Cars now use more electronics and digital electronics uses more software. Yoshiki Matsui, a professor at Yokohama National University, said: “For electronics, quality is largely determined at the design stage. If there’s a flaw, it doesn’t matter how good quality control is at the assembly plant”.

On Monday, Sony told millions of PlayStation 3 users not to use their games consoles as it rushed to fix a bug. The warning appeared to be another blow to one of the biggest names in the electronics industry.

Sony, which on Tuesday said it had resolved the glitch, believes its PS3 problem was because of a bug in the clock system that led consoles to act as if 2010 was a leap year.

Toyota answered complaints about the brakes in its Prius hybrid with a patch to the software that controls them.

The problems highlight how Japanese companies have had to accept imperfections as products become more complex and their lifespan shorter, and mass-market consumers have demanded lower prices. “It’s extremely costly to make products 100 per cent defect-free,” said Mr Matsui.

Japanese companies also have less control over manufacturing after setting up plants around the world. Mr Matsui says it can take five years to bring a new overseas plant up to domestic standards.

Overseas manufacturing can also mean relying on local parts suppliers – many of the recalled Toyotas had accelerator pedals made by CTS Corp of the US – without the deep ties that mark Japanese supply chains.

In electronics, production of consoles such as the PS3 and Nintendo’s Wii is outsourced to Taiwan or China.

Analysts say that what this means is that when there is a problem, modern manufacturing ensures it will be big.

A drive to share components across vehicles means that faults can affect millions of cars. PS3s are almost identical around the world, and so if a defect hits one it is likely to hit them all.

News of faults also spreads quickly on the internet: 20 years ago Sony’s leap-year problem would probably have been fixed before it was widely reported.

None of these issues is unique to Japan, but it matters more when something goes wrong with a Japanese product because so much of the brand value of Toyota or Sony lies in the promise of reliability.

Even as it becomes more difficult, preserving Japan’s reputation for quality is becoming increasingly important, said Mr Iizuka, as China and other low-cost countries draw away production of cheap, mass-market goods.

Toyota’s problems are fuelling a wider existential crisis in Japanese manufacturing. The recession forced many factories to close, and young people, who want less laborious careers, show little interest in the manufacturing jobs that remain.

Mr Matsui says: “Japan has built its brand on having the best quality…If companies are careless, they could lose that quickly”.

SORRY FOR DWELLING ON THIS--IN MY FORMER LIFE AS AN ENGINEER, I USED TO RAIL AGAINST STUPID US MANUFACTURERS WHO IGNORED DEMING AND SO HE LEFT FOR JAPAN AND THE REST IS HISTORY

http://www.hci.com.au/hcisite2/articles/deming.htm

NOW WE SEE THAT GLOBALISM ISN'T WHAT IT'S CRACKED UP TO BE--UNIVERSAL, INTERCHANGEABLE WIDGETS AND MASS-PRODUCED WORKERS AND CONSUMERS ARE FIGMENTS OF AN OVER-ACTIVE IMAGINATION.

[ozymandius]

10. Years ago when I managed databases -

if there were an error in a piece of information that was replicated throughout the system (think 'copy' and 'paste' repeated hundreds or thousands of times) then it was absolute craziness to correct the error after the thing had 'gone viral'.

Similarly - I expect Toyota is furiously pouring through all the designs and part manifests that have combined to bruise their image. If you get it right the first time then there's no problem. But if one thing is malformed and distributed throughout millions of vehicles with each vehicle composed of thousands of complex parts then I expect some Toyota engineers are losing quite a lot of sleep these days.

[Demeter]

12. I'm Reminded of a Montgomery Scott quote:

"The more they overthink the plumbing, the easier it is to stop up the drain." (Star Trek III: The Search for Spock)

This is an extrapolation of Murphy's law:
http://en.wikipedia.org/wiki/Murphy%27s_law

...American Dialect Society member Stephen Goranson has found a version of the law, not yet generalized or bearing that name, in a report by Alfred Holt at an 1877 meeting of an engineering society:

It is found that anything that can go wrong at sea generally does go wrong sooner or later, so it is not to be wondered that owners prefer the safe to the scientific.... Sufficient stress can hardly be laid on the advantages of simplicity. The human factor cannot be safely neglected in planning machinery. If attention is to be obtained, the engine must be such that the engineer will be disposed to attend to it.

American Dialect Society member Bill Mullins has found a slightly broader version of the aphorism in reference to stage magic. The British stage magician Nevil Maskelyne wrote in 1908:

It is an experience common to all men to find that, on any special occasion, such as the production of a magical effect for the first time in public, everything that can go wrong will go wrong. Whether we must attribute this to the malignity of matter or to the total depravity of inanimate things, whether the exciting cause is hurry, worry, or what not, the fact remains.

Murphy's law emerged in its modern form no later than 1952, as an epigraph to a mountaineering book by Jack Sack, who described it as an "ancient mountaineering adage":

Anything that can possibly go wrong, does.

Fred R. Shapiro, the editor of the Yale Book of Quotations, has shown that in 1952 the adage was called "Murphy's law" in a book by Anne Roe, quoting an unnamed physicist:

There were a number of particularly delightful incidents. There is, for example, the physicist who introduced me to one of my favorite "laws," which he described as "Murphy's law or the fourth law of thermodynamics" (actually there were only three last I heard) which states: "If anything can go wrong, it will."

THE FOLLOWING CLAUSE IS SOMETIMES ADDED: "AND IN THE WORST POSSIBLE WAY"

[FarCenter]

69. A corollary -- the butter side down law

Regardless of how it is dropped, a piece of toast will land on the floor with the butter side down.

[TalkingDog]

74. Energy Crisis Solved

Since a cat always lands on it's feet and a piece of toast always lands butter side down; you can strap a piece of buttered toast to a cats back and drop it from a small height. As the cat/toast nears the floor it will hover a few inches from the floor and begin to slowly rotate.

After that, it is merely a matter of harnessing the angular momentum of the cat/toast rotation.

[Dr.Phool]

75. Patent that! You'll make brazillions!

[Demeter]

78. Do you know what a squirrel cage rotor is?

http://en.wikipedia.org/wiki/Squirrel-cage_rotor

It's been done.

[FarCenter]

81. It's the Buttered Cat Paradox

See http://en.wikipedia.org/wiki/Buttered_cat_paradox

[ozymandius]

7. Synovus Financial facing informal SEC inquiry: filing

(Reuters) – U.S. southeast regional bank Synovus Financial Corp (SNV.N) said it is facing an informal inquiry from the U.S. securities regulator, filings show.

On December 15, Synovus received a letter from the Securities and Exchange Commission (SEC), Atlanta regional office, informing the company that it is conducting an informal inquiry "to determine whether any person or entity has violated the federal securities laws."

The company said the SEC has not asserted that Synovus or any person, or entity has committed any securities violations, according to company's filing submitted with SEC on March 1.

http://news.yahoo.com/s/nm/20100303/bs_nm/us_synovusfinancialcorp

---

Lawsuits over bank conduct tend to trigger these inquiries.

[Demeter]

8. Citi to sell stake in Primerica

http://www.ft.com/cms/s/0/ea806bd4-2657-11df-aff3-00144feabdc0.html

Citigroup is to sell up to $330m worth of shares in Primerica, its door-to-door insurance unit, to Warburg Pincus, in a move that will give the private equity group a significant stake in the insurer and could help pave the way for its listing.

The move, revealed on Tuesday in a regulatory filing, is part of Citi’s efforts to sell billions of dollars in non-core assets and rebuild its battered fortunes after suffering huge losses during the financial crisis.

Under the terms of the deal, Warburg Pincus will buy up to $230m worth of shares in Primerica at a 5 per cent discount to the company’s book value.

The private equity firm has the option to buy another $100m worth of stock at the listing price and will also receive a warrant giving it the right to purchase more shares in the seven years after the initial public offering.

The regulatory filing did not specify the stake Warburg and Citi would hold in Primerica after the IPO, which is expected later this year. However, it said the private equity group had agreed not to control more than 35 per cent of the voting power in Primerica.

Following the deal, Warburg Pincus will be able to nominate two directors to Primerica’s nine-member board, whom Citi will support, while Citi itself will only nominate one. Once Warburg Pincus’ stake in Primerica falls below 15 per cent, however, it will only be able to name one director to the board. Executives at Primerica, whose main asset is an army of 100,000 insurance salespeople, will take up two board seats.

Warburg Pincus is a long-standing investor in financial services and recently recruited Alain Belda, the outgoing chairman of Alcoa and a former lead director at Citi.

Under the original IPO plan, announced in November last year, people close to Citi, whose largest shareholder is the US government, said the company wanted to list around 20 per cent of Primerica.

People close to the situation said the Warburg Pincus deal would reduce Citi’s stake in Primerica from the original 80 per cent and make it easier for the bank to sell the rest - either through a secondary offering or a trade sale. Having Warburg as an anchor investor could also make it easier for Citi to persuade other investors to buy into an IPO that had been met with some scepticism by market participants.

Before announcing the IPO, Citi had tried to sell Primerica to private equity groups but was not able to clinch a deal. Citi and Warburg Pincus declined to comment.

NOW WHY CAN'T THE US GOVT. GET SUCH TERMS FROM ITS BAILOUT BUDDIES?

[Demeter]

9. BP to cut costs and raise production

http://www.ft.com/cms/s/0/bf864ada-25fc-11df-b2fc-00144feabdc0.html

BP still has scope to raise efficiency and cut costs, the company said on Tuesday as it set out plans to boost its underlying annual profits by $3bn (£2bn) over the next two to three years.

In its annual strategy presentation, the oil and gas group also said it expected to raise production by an average of 1-2 per cent a year between 2008 and 2015, and was increasingly confident that it could continue to grow at that rate until the end of the decade.

Tony Hayward, chief executive, also suggested that BP was not likely to acquire any other companies, saying it would continue buying assets but he would be “surprised if we saw opportunities at the corporate level”....

Under Mr Hayward, who took over in May 2007, BP’s financial and operational performance has recovered relative to its peers, but still falls short of the best.

BP is the world’s largest private sector oil company by production volume, but only about 55 per cent of the size of ExxonMobil by market capitalisation.

Mr Hayward said BP was now entering “a new phase to realise the potential of the portfolio built over the past decade”.

Savings from efficiency gains were $2.4bn last year, taking cash costs to about $26bn. That rate of improvement is set to slow, but Mr Hayward said there were still plenty of opportunities to improve performance.

The majority of the expected savings will come in refining and marketing, which has been the most troubled of BP’s divisions in the past five years.

After accidents and hurricane damage at its US refineries, their operational availability slumped. That has been restored, and they are close to full operation, but the recovery has been delivered with little improvement in cost efficiency. BP says there is an opportunity to raise profitability by bringing the US and other refineries up to the standard of the best, which are all in Europe.

Having sold 10 refineries in the past seven years, BP does not plan any further large disposals, although it is selling marketing assets, such as its petrol stations in several African countries.

The other main objective for savings is in development of large projects, where BP has a patchy record.

On average during 2004-08, BP’s projects came in 20 per cent more expensive than their sanctioned maximum cost, with only 5 percentage points of that because of unavoidable cost inflation for materials such as steel.

The company has created a new centralised development unit, based at the headquarters of the exploration and production business in Houston, to run large projects worldwide, with the aim of sharing and managing the experience and skills of BP’s engineers more effectively.

ANOTHER OIL COMPANY BROUGHT BACK DOWN TO EARTH

[Demeter]

11. Morning Ozy!

It's gotten a bit colder yesterday and even moreso today. The snowdrops reappeared, and they look totally battered by spending a month under snow. Maybe next year they won't be so precipitate.

Have you placed a bet as to which political party will disintegrate first?

The GOP had a commanding lead, but since the election, the Democrats have been working together to pull even and maybe even surpass them. It's quite exciting!

[ozymandius]

13. Good morning, Demeter.

:donut: :donut: :donut:
We had snow showers here yesterday. These were big, sloppy snowflakes. The ground was too warm for anything to stick. Even now, before sunrise, the temperature is above freezing. The next few days will be warmer than usual. Rumor has it that we could see temps into the 60s by this weekend.

As for political party disintegration: My bet is on the Republicans. The Democratic party has a strong element of corporate servants - particularly in the Senate - which will throw their constituencies under the bus if push comes to shove. That element can be primaried away. As Atrios says, "We need more and better Democrats."

Republicans have an element that cannot be primaried away: the crazies. The corporate shills we have come to know are now becoming infected with the crazy types that have worked their way from the grass roots into the party hierarchy. Think: Palin and secessionist panderer Governor Perry. Corporatists like McConnell may regret so many years of luring the religiously insane into their base.

[Demeter]

15. Trying to Give Me "Hope", Ozy?

Well, since nobody asks us, we will just have to wait and see.

I'm more inclined to put the effort into a third party, although it would be efficient and empowering to take over the Democratic Party from the Rahmbo class.

PS: I LOVE that cartoon!

[Tansy_Gold]

22. G'morning, Ozy, Demeter, and all who follow

Just a quick drive-by post before I head to Lowe's -- they open at 5:00 a.m.

I'll put in for a third option -- a "charismatic" leads a third party to victory and both parties simultaneously self-destruct.

Have a great day, folks. It's gonna be sunny and nice here, after all the rain.




Tansy Gold, home improver

[Demeter]

23. And Presidential Candidate of these United States

"We can have a wealthy nation, or an obscenely wealthy elite over-class, but not both."

[ozymandius]

27. A student was wearing a Bull Moose party t-shirt yesterday.

I asked him why he chose that shirt. He thinks that we need another Teddy Roosevelt. It's really inspiring when a 14 year-old gets it.

[Demeter]

31. Will We Ever Get a Pair Like Franklin and Teddy?

No other family, including the Kennedys, ever did as much for this nation. And I include the Adams family in that...John was great, but Quincy?

[tclambert]

43. The Addams family?

Gomez and Morticia?

Wasn't John Quincy the one who argued the Amistad case before the Supreme Court? Or was it Hannibal Lecter? Sometimes I get my history confused.

[Demeter]

44. You are correct--I take it back

Amistad was never part of my formal history education--and I haven't been paying too much attention to it now that it's being uncovered.

and what an amazing tale it is:

http://en.wikipedia.org/wiki/Amistad_%281841%29

[KoKo]

47. hmmm....wonder if there's a way Progressive Dems could do "Bull Moose II?"

Attract some Repugs who are sick of the Palin/Tea Party haters...and some Progressives who are getting sick of their own parties fecklessness.

Bull Moose II.

Sounds like something Demeter might be able to work up for the weekend. Whatever, I think I'll go refresh my mind on Teddy Roosevelt's efforts at breaking up monopolies.

[Demeter]

51. It Would Be Better To Take Over the Party

with Dr. Dean installed as leader and candidate...and invite all the sane people regardless of previous affiliation...

a girl can dream, dammit!

[Dr.Phool]

77. Sane leaves me out.

[Roland99]

52. Dean was an ideal candidate that got railroaded by the MSM

Kucinich doesn't have the "looks" to persuade the millions of vapid American voters out there.

Franken has the right ideas but, in all seriousness, don't see him in the White House.

Grayson is a firebrand...too boisterous for the Executive branch. We need people like him in Congress.


No, I feel our ideal candidate is still out there, waiting to be noticed on the national scene. It might take a few decades but it will happen. Need to focus on local/state positions and rise up through the ranks. Perot was a fluke and, imho, if he'd not bowed out and re-entered and had picked a...welllll...sentient V.P. candidate, we might have seen a sea change 20 years ago.

[KoKo]

57. Bull Moose Campaign Button....

[TalkingDog]

71. That is awesome. Where can I get one?

Yesterday if possible.

[KoKo]

82. Here's the website with many Bullmoose symbols...

http://images.google.com/images?q=Bullmoose+Party&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&um=1&ie=UTF-8&ei=18SOS9GtDMLV8Aasxbz9DA&sa=X&oi=image_result_group&ct=title&resnum=4&ved=0CBsQsAQwAw

[Demeter]

59. If Reagan Could Be President, Franken Could Be President

[Roland99]

62. If the M$M didn't exist I'd agree with you.

The media would roast him.

Or, better put, would allow the Repukes to frame the discussion.

[Demeter]

63. By 2011, there may not be any MSM either

The Internet is killing it--a mercy killing, IMO. Things are going to accelerate in change and it's all downhill, with the exception perhaps of Detroit...

[Roland99]

64. Yeah, newspapers/magazines are going away but the Fauxs and CNNs aren't going anywhere

and that seems to be where dialog gets framed more often than any other place.

[Demeter]

70. Cable is not Healthy

they are pricing themselves out of reach as well as adulterating their programming with crap and comercials. and the broadcast switchover to Digital did nothing to improve the quality of the material...

[ozymandius]

25. I always offer hope. Weirder things have happened.

The Rahmbo classes are discredited. Just look at how much suffering they have caused. Educated during the Reagan years and cutting their policy teeth during the Clinton years - their policies and actions have realized none of the broader benefits rhetoric claimed to bestow. Look at the unemployment and healthcare scenarios, for a net sum result of Reagan policy mutations. Millions of people are probably asking questions like: 'why can't I find a job?', and 'why does my new job only pay

Thanks for the cartoon compliment. Indeed - Bunning has enlisted with the Crazy Militia.

[Demeter]

14. Doubts over Prudential's AIA move

http://www.ft.com/cms/s/0/2379e970-262f-11df-aff3-00144feabdc0.html

Prudential’s shares have fallen almost 20 per cent since it agreed a $35.5bn takeover of the AIG’s Asian life business, raising concerns about the UK insurer’s ability to close the deal

Hedge funds betting against the stock were blamed by some in the market for the drop in the shares, while others said investors were growing increasingly nervous about the stock and currency market risks over the next two months.

The deal to buy AIA, which was hammered out last week and announced on Monday, would more than double the size of the Pru and transform it into a company dominated by its Asian businesses.

One banker familiar with the situation and a senior Pru executive, said the company had fully hedged the currency risk attached to the deal by the time it announced the agreement, but the amount of stock the group would have to issue was hostage to its share price.

Pru shares finished down 8 per cent at 487.5p on Tuesday – having been below 480p earlier – meaning they have lost almost one-fifth of their value since the start of the week.

Some in the market said the Pru could have left itself vulnerable to a takeover approach if its shares continued to fall and a rival took the opportunity to bid before the AIA deal made it an unassailable target.

Such a move would make little sense for either Pru shareholders or a bidder, said one person involved with the company, because the bid would have to be for more than the £6 that Pru stock traded at before the AIA deal was announced.

The person said: “Shareholders can take an offer, they can vote for the deal, or they can vote against a deal.

“But why would they take an offer from say Axa at £5 or less? If the AIA deal is not done, the stock goes back to £6.”

However, hedge funds will be focusing most on the $20bn-equivalent rights issue, according to analysts, because it is already likely to dilute investors’ holdings, making their stock worth less. But the more the price falls, the more the dilution will increase.

One banker familiar with the company said: “The crucial mistake they have made is not to fix the number of shares they are going to issue.

“They are trapped in a vicious circle.”

One of the insurer’s biggest investors said: “The deal is incredibly dilutive and the financing unbelievable. It may be bold and audacious in the very long term but in the short term there is $35.5bn of execution risk.”

Bankers involved in the deal said there were weeks of work involved in preparing AIA’s financial data under Pru accounting standards.

[Demeter]

17. Hedge funds raise bets against euro

http://www.ft.com/cms/s/0/ebec7004-262e-11df-aff3-00144feabdc0.html

Hedge funds are raising their bets against the euro amid growing fears of a regulatory backlash against their trading positions on the specific sovereign debt of Greece and other weak eurozone economies.

Many of the world’s biggest hedge funds have become increasingly concerned about fierce criticism by European politicians that their country bets have heightened the crisis of confidence in some markets.

Services Authority, the UK market regulator, on Tuesday became the latest heavyweight figure to add his support to an investigation into speculative positions in financial instruments that gain from a fall in prices of sovereign and corporate debt.

Hedge funds such as Brevan Howard and Moore Capital, have concluded that the political and regulatory risks associated with positions against individual countries in the currency bloc were now too unpalatable.

In its most recent letter to investors, Brevan Howard – Europe’s largest hedge fund with around $27bn of assets under management – said that the short trade in eurozone government bonds was “extended, crowded, fully prices the fundamentals”.

The letter added that the trade was “exposed to a regulatory squeeze as occurred on short positions on financial stocks in 2008”. It said the fund has closed out all of its positions on European sovereign debt.

In a recent letter to investors, Moore Capital, which manages just under $15bn of assets, accused EU authorities of “uninformed blamecasting” and said that it currently had no net short position against Greek debt.

Paulson & Co, the $32bn US fund that shot to prominence shorting the US mortgage market last year, has also closed out its positions against Greece, according to people familiar with the situation.

However, market positions against the euro, which on Tuesday hit a fresh nine-month low against the dollar, as a whole are up sharply.

The manager of one multi-billion London-based fund said: “Hedge funds are now expressing the same view on the weaknesses of individual eurozone countries via the euro”.

An estimated $12.1bn of short positions are outstanding against the currency, according to the Commodity Futures Trading Commission. At the beginning of February, there was just over $7bn of short positions it.

Speaking to a parliamentary select committee on Tuesday, Lord Turner said that regulators should seriously consider preventing investors from buying so-called credit default swaps on both corporate and sovereign debt unless they are using it to hedge an existing investment. CDS provide insurance against default of a debt instrument.

While playing down the effect of so-called “naked” purchases of CDS – buying credit default protection without ownership of the underlying bond - Lord Turner said that a ban on speculative purchases “is something that should be discussed”.

He said: “It may be that even if you banned it, it wouldn’t make a big difference there are questions as to whether you should be allowed to take out an insurance contract where you don’t have an insurable interest”.

[Demeter]

18. Plans for Fed link to CFPA draw fire

http://www.ft.com/cms/s/0/76cac696-2646-11df-aff3-00144feabdc0.html

Democrats led by Barney Frank on Tuesday slammed a proposal to grant additional consumer protection powers to the Federal Reserve, as the latest idea designed to unlock talks in the Senate appeared destined for the scrap heap.

Mr Frank, chairman of the House financial services committee, described the plan as a “joke” in language that pits him against Chris Dodd, his Democratic counterpart in the Senate.

Other Democrats in the Senate and the House expressed scepticism about the plan, although the White House and the Democratic leadership in the House stopped short of declaring the proposal dead.

The Fed had appeared to be enjoying a surprising political renaissance when the proposal, which emerged after talks between Mr Dodd, chairman of the Senate banking committee, and Bob Corker, his Republican negotiating partner, came to light on Monday.

Mr Dodd has been struggling to find a compromise acceptable to Republicans amid hostility to a strong stand-alone Consumer Financial Protection Agency (CFPA), which was proposed by the Obama administration as a way to prevent the mis-selling of products such as credit cards and mortgages.

After other Democrats on the banking committee and beyond got wind of the plan to house the authority in the Fed, there was an immediate backlash that further clouds the prospects for financial regulatory reform.

The Fed has been under attack from Congress for months, with its bank supervision role, immunity from complete congressional audits and the election of members of regional boards all threatened by legislative proposals.

While the Fed has managed to fend off much of the criticism, with the strong support of Tim Geithner, Treasury secretary, the central bank was expected to have to give up its consumer protection remit.

Parts of the financial industry have welcomed the proposals, which go a long way to meeting the objection that a regulator charged with ensuring safety and soundness should not have to battle a separate regulator pushing a pro-consumer agenda.

“We still need to see the final details, but have long supported housing consumer protections with prudential regulation for safety and soundness in the same regulator,” said Scott Talbott, vice-president for government relations at the Financial Services Roundtable, a forum for the sector’s leaders.

But the US Chamber of Commerce – which has spent millions of dollars opposing the creation of the CFPA and claims it would increase the cost of doing business, with knock-on effects for the cost of credit to individuals and businesses – said it remained dissatisfied.

Senate aides continued to work on different areas of financial regulatory reform legislation last night but the CFPA stands in the way of publishing a bill that had been expected as soon as Thursday.

Aside from the home of the enhanced consumer authority, the scope of its powers are also under debate inside and outside Congress.

“A lot of the debate and focus on the CFPA is misdirected,” said Richard Neiman, superintendent of banks for the state of New York. “A lot of the focus is on where the agency is going to be located and a focus on product terms. Both of those don’t get to the real issue.”

He said institutions should be required to consider whether a customer had the ability to repay a loan and it was crucial that any new federal agency did not have wide-ranging “pre-emption” powers to prevent states taking tougher action.

THANK YOU BARNEY FRANK! YOU MAY BE CO-OPTED AT TIMES, BUT WHEN YOU COME THROUGH, IT IS APPRECIATED.

[Demeter]

19. Genetically modified potato wins EU approval

http://www.ft.com/cms/s/0/e00b505a-2630-11df-aff3-00144feabdc0.html

A German-engineered potato on Tuesday became the first genetically modified organism in 12 years to win approval for cultivation in the European Union, sparking celebration among GMO manufacturers and outrage among opponents.

The Amflora potato was developed by BASF, the German chemicals group, to provide high-quality starch for industrial customers, such as paper and textile manufacturers, and is unlikely to end up on consumers’ plates.

Supporters and opponents said the decision by the European Commission – after 13 years of bureaucratic, scientific and legal wrangling – marked the beginning of a more welcoming posture in Brussels towards the products.

“We hope that this decision is a milestone for further innovative products that will promote a competitive and sustainable agriculture in Europe,” said Stefan Marcinowski, member of the board of executive directors of BASF. “After waiting for more than 13 years, we are delighted that the European Commission has approved Amflora.”

BASF plans to begin growing Amflora this year on 250 hectares in the Czech Republic, Sweden and Germany.

Marco Contiero, a Greenpeace policy analyst, said: “The EU has opened the door to GMOs.”

Even as GMOs have been embraced by the US, Canada, Brazil and other agricultural powers, Europeans have remained wary amid fears they could pose unforeseen health and environmental dangers.

Before Amflora, only one other GMO had been approved for cultivation in the EU – Monsanto’s MON810 maize, in 1998 – in spite of repeated findings from the European Food Safety Authority that such products did not pose health risks.

GMO products are available in Europe through imported food and animal feed. The commission on Tuesday approved a further three Monsanto GM maize types for import and processing.

Manufacturers said resistance to GMOs threatens the competitiveness of European farmers and the long-term food security of the EU.

José Manuel Barroso, the commission president, has pledged to take a more science-based approach, transferring the portfolio from the environment directorate, a GMO opponent, to the department overseeing health and consumer affairs.

In announcing the potato approval, John Dalli, the new health commissioner, said “all scientific issues” had been “fully addressed” and “any delay in taking a decision now would have simply been unjustified”. But the move drew an angry response from Italy where Luca Zaia, the agriculture minister, threatened to rally member states against it.

Mr Dalli also noted the Commission’s support for a policy that would allow member states to opt out of GMO cultivation – although such a move could run foul of World Trade Organisation rules and those governing the EU’s single market.

Mr Contiero restated concerns that Amflora contains a gene that confers resistance to certain antibiotics and accused Mr Barroso of “steamrollering” opponents by approving the potato through a procedure that does not require debate by the full Commission.

“We will not allow a similar measure, decided only by the top floors, to affect our agriculture,” he said. “For this reason we are evaluating the possibility of promoting a common front of all the countries wishing to join us in protecting the citizen’s health and the European farming identities.”

Mike Hall, a spokesman for DuPont’s Pioneer Bio division, said the decision could speed the way for approval of its 1507 maize product, which has been under review since 2001. “They’re fed up with the ping-pong political match of this and they’re going back to science,” he said of the Commission.

[Demeter]

21. ONION OP-ED By House Minority Leader John Boehner (R-OH)

http://www.theonion.com/content/opinion/my_constituents_care_way_more?utm_source=onion_rss_daily

It is my responsibility as an elected official to look out for the people back home, the voters who sent me to Washington. So, after 20 years representing Ohio's 8th District, I know what the good citizens of Montgomery, Preble, and Butler counties really want: someone who engages in the kind of calculated political gamesmanship that increases his standing in the Republican party while simultaneously hindering our country's legislative process at every conceivable turn.

I assure you, the last thing my voters need is some well intended, do-all-I-possibly-can-to-help-the-little-guy congressman running around Washington, working across the aisle, and fighting tooth and nail for jobs, health care, and financial reform to ensure their tax dollars never end up in the hands of banks capable of holding our entire economy hostage.

No, sir. My constituents deserve better.

They deserve a leader willing to roll up his sleeves and play the types of twisted, greedy political games that, by their very nature, tear apart the fabric of our democracy for the sake of assuring reelection. They deserve someone on their side who will ask the tough questions, such as how will painting Democrats as radical ideologues play in, say, Arkansas? Can we vote "no" on the health care bill and still make it look like we give two craps about the welfare of ordinary Americans? How can we twist positive news about the GDP into a negative for the Obama administration?

Trust me: If you talk to an unemployed, uninsured mother of two in Greenville, she'll tell you that jobs and reliable medical coverage come a distant second to the crafting of meticulous talking points that deftly omit the facts and reduce what should be honest discourse about our country's future to a series of contrived, easy-to-digest sound bites designed to sway crucial independent voters.

Take the folks I represent in Dayton. They've seen unemployment skyrocket to 13.2 percent. Now, here is what I did for them: Even though the nonpartisan Congressional Budget Office predicts that the stimulus bill will ultimately save or create 2.5 million jobs, I came out and said that the dismal performance of the "stimulus" demonstrates the danger of letting Washington take more control of our economy.

My constituents had to be proud. They must have loved the way I blatantly ignored the truth and put quotation marks around "stimulus" so as to delegitimize the whole project. And I bet they noticed that, with just one sentence, I slyly preyed on America's inherent distrust of big government. Pretty good, huh? It's all bullshit of course, but it's a great political play: slimy, deceitful, and downright irresponsible—the kind of no-nonsense, no-actual-help-for-anyone-but-myself strategy that the struggling voters in Butler and Mercer counties rely on.

The fact is, if I ever worked across the aisle to help thousands of uninsured Ohioans receive health care, I wouldn't be able to look them in the eye. How could I explain to them that I abandoned the idiotic yet politically fruitful claim that Barack Obama is a socialist bent on destroying the American way of life? How could I admit to them that deficit spending is the only way to get us out of an economic crisis perpetuated by my party's disastrous fiscal ideology? How could I tell them I stopped obsessing over scoring petty political points right before the midterm election?

How could I stop being the greedy, myopic scumbag they elected me to be?

More than anything, average, workaday Ohioans want me to play politics at the shrewdest, most despicable level, not to waste their time making surgery affordable or offering tax breaks to small businesses. And my constituents are so thankful that I took a nation that was actually hopeful at the beginning of 2009 and turned it into a paranoid, demoralized country unsure of whether it made the right choice in 2008.

But in the end, of course, I can't take full credit for the Republican Party's utterly undeserved yet all-too-depressingly-real resurgence. That would be unfair to my Democratic colleagues, who, in their unwillingness to act like grown adults with any kind of backbone and exercise the largest majority any party has seen in decades, have let us get away with all of it.

Thank you, you cowardly pieces of shit.

[Demeter]

35. Bill Bonner Bashes the Gipper (and Palin)

(no link available)

A few years ago, we blamed Ronald Reagan for ruining conservativism in America. Here is Gideon Rachman, in The Financial Times, making our point:

"This might seem an odd conclusion, since President Reagan is a conservative hero who won two presidential elections. But the ideas that are now known as 'Reaganism' are, in fact, profoundly subversive of some of the most important conservative values. Traditional conservatives disdain populism and respect knowledge. They believe in balancing the government's books. And they are pragmatists who are suspicious of ideology. Reagan debased all these ideas - and modern American conservatism is still suffering the consequences.

"The most damaging idea propagated by the Reagan myth is the cult of the idiot-savant (the wise fool). You can see it in the very first line of Dinesh D'Souza's admiring biography of Reagan, which proclaims: 'Sometimes it really helps to be a dummy.' Mr D'Souza recounts numerous stories in which intellectuals - even conservative intellectuals - disdained Reagan. They scorned his tendency to spend cabinet meetings sorting jelly beans into different colours, and his taste for flaky anecdotes. But, Mr D'Souza concludes, the 'dummy' was right and the pointy-heads were wrong.

"A dangerous chain of reasoning flows from this popular version of history. Reagan was apparently stupid and often startlingly ignorant - but he was vindicated by history. Therefore, goes the theory, ignorance and stupidity are good signs. They show that a politician is in tune with the deeper wisdom of the people. Once you start thinking like that, it is but a short step to Sarah Palin.

"If it is ignorance you are after, then Ms. Palin is definitely your woman. Game Change, a recent book on the 2008 presidential election campaign, recounts how desperate advisers to the McCain-Palin campaign decided that they had to give her a crash-course in modern history, before the vice-presidential debate with Joe Biden.

"They sat Palin down at a table in the suite, spread out a map of the world, and proceeded to give her a potted history of foreign policy. They started with the Spanish civil war, then moved on to world war one, world war two, the cold war. When the teachers suggested breaking for lunch or dinner, the student resisted. 'No, no, no, let's keep going,' Ms. Palin said. 'This is awesome'."

"The history of the 20th century? I suppose it is pretty awesome.

"In fact, Ms. Palin is much, much less qualified to be president than Reagan ever was. She is Ronald Reagan lite - and Reagan was pretty lite to begin with. But he had, at least, been governor of California, not Alaska, and had read widely.

"The damage Reaganism did to conservatism extends well beyond the Palin effect. The late president also became associated with a couple of bad ideas that helped make the administration of George W. Bush such a disaster. The first was fiscal incontinence; the second is the view that the key to a successful foreign policy is a rigid distinction between good and evil, and a strong military.

"The Republican party - with Ms. Palin to the fore - is currently decrying the huge deficits being run by the Obama administration. But this is a recent conversion. Ever since the Reagan years, the Republicans have been the party of deficit spending.

"Conservatives once believed both in lower taxes and in balancing the budget. Under Reagan, they simply became the party of tax cuts, without any commitment to fiscal responsibility. Dick Cheney, George W. Bush's vice-president, admitted as much when he told a cabinet colleague: 'Reagan proved deficits don't matter.' A mystical belief took hold that if you just cut taxes, the economy would grow fast enough to cover the shortfall - or government would shrink, almost by magic. Somehow it would all come right. This drift in Republican thinking was actually profoundly anti-conservative - because it elevated ideology (cut taxes at any cost) over a pragmatic commitment to good governance.

"It is the same with foreign policy. Reagan's insistence that the Soviet Union was an 'evil empire' caused many liberals to wince - but was basically accurate. However, when George W. Bush attempted to emulate Reagan's 'moral clarity', he came up with the 'Axis of Evil' - a silly concept that led America into a costly and unnecessary war in Iraq. President Bush also missed the fact that while Reagan had built up the US military, he had avoided any big wars. Invading Grenada under Reagan was one thing; invading Iraq under Mr. Bush turned out to be quite another.

"The real Reagan was, in fact, rather more pragmatic than the 'Reagan myth' that sprang up after he left office. Real Reagan was willing to raise taxes in extremis, and became a firm believer in arms-reduction talks. Today's American conservatives, who claim the mantle of Reagan, would regard these ideas as treachery and weakness. Reagan was ultimately a successful president. But he left behind a poisonous legacy for the conservative movement."

SEE ALSO:How Reagan ruined conservatism By Gideon Rachman

http://www.ft.com/cms/s/0/d640855c-256a-11df-9cdb-00144feab49a.html

[Dr.Phool]

42. Palin 64.

Lite beer lite.

If brain cells were calories, she'd have less than water.

[Festivito]

20. Debt: 03/01/2010 12,507,536,462,861.04 (UP 67,468,442,146.57) (Mon)

(Up big. New higher limit in effect for a few days now. Debt seems to jump up big then drop slowly maybe up a little and down a little for days--repeat. Maybe that will change to bigger rises now that the limit has been raised. Have to wait and see. I get to be the fifth rec this morning. Good day all.)

= Held by the Public + Intragovernmental(FICA)
= 8,024,927,072,288.80 + 4,482,609,390,572.24
UP 88,256,071,194.67 + DOWN 20,787,629,048.10

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 309-Million person America.
If every American, man, woman and child puts in $3.24 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.71, ABOUT TEN BUCKS for a 1B$ 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 10 seconds we net gain another American, so at the end of the workday of the report, there should be 308,867,358 people in America.
http://www.census.gov/population/www/popclockus.html ON 11/07/2009 08:19 -> 307,879,272
Currently, each of these Americans owe $40,494.85.
A family of three owes $121,484.54. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 20 reports in the last 30 to 28 days.
The average for the last 20 reports is 7,903,643,889.68.
The average for the last 30 days would be 5,269,095,926.45.
The average for the last 28 days would be 5,645,459,921.20.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 102 reports in 152 days of FY2010 averaging 5.86B$ per report, 3.93B$/day.
Above line should be okay

PROJECTION:
There are 1,056 days remaining in this Obama 1st term.
By that time the debt could be between 14.0 and 18.5T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
03/01/2010 12,507,536,462,861.04 BHO (UP 1,880,659,413,947.96 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +0,597,707,459,349.30 ------------* * * * * * * * * * * * * * BHO
Endof10 +1,435,284,359,621.68 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
02/08/2010 +000,119,837,978.11 ------------******** Mon
02/09/2010 +000,368,016,270.35 ------------********
02/10/2010 -000,056,577,287.25 ----
02/11/2010 +007,265,093,186.33 ------------*********
02/12/2010 -000,104,736,856.82 ---
02/16/2010 +030,097,605,306.92 ------------********** Tue
02/17/2010 +000,408,694,886.67 ------------********
02/18/2010 +015,224,901,067.79 ------------**********
02/19/2010 +000,114,262,910.59 ------------********
02/22/2010 -000,206,249,204.22 --- Mon
02/23/2010 +000,404,218,476.39 ------------********
02/24/2010 -000,081,552,792.52 ----
02/25/2010 +034,823,775,896.06 ------------**********
02/26/2010 +007,974,774,874.74 ------------*********
03/01/2010 +088,256,071,194.67 ------------********** Mon

184,608,135,907.81 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4289801&mesg_id=4289806

[Festivito]

87. Debt: 03/02/2010 12,519,423,725,485.39 (UP 11,887,262,624.35) (Tue)

(Up some. Up a lot lately. Debt seems to jump up big then drop slowly maybe up a little and down a little for days--repeat. Good day all.)

= Held by the Public + Intragovernmental(FICA)
= 8,024,978,491,495.22 + 4,494,445,233,990.17
UP 51,419,206.42 + UP 11,835,843,417.93

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 309-Million person America.
If every American, man, woman and child puts in $3.24 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.71, ABOUT TEN BUCKS for a 1B$ 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 10 seconds we net gain another American, so at the end of the workday of the report, there should be 308,875,998 people in America.
http://www.census.gov/population/www/popclockus.html ON 11/07/2009 08:19 -> 307,879,272
Currently, each of these Americans owe $40,532.2.
A family of three owes $121,596.6. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 20 reports in the last 30 to 28 days.
The average for the last 20 reports is 7,923,986,807.00.
The average for the last 30 days would be 5,282,657,871.33.
The average for the last 28 days would be 5,659,990,576.43.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 103 reports in 153 days of FY2010 averaging 5.92B$ per report, 3.98B$/day.
Above line should be okay

PROJECTION:
There are 1,055 days remaining in this Obama 1st term.
By that time the debt could be between 14.0 and 18.5T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
03/02/2010 12,519,423,725,485.39 BHO (UP 1,892,546,676,572.31 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +0,609,594,721,973.60 ------------* * * * * * * * * * * * * * * BHO
Endof10 +1,454,261,918,433.76 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Linear Projection

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
02/09/2010 +000,368,016,270.35 ------------********
02/10/2010 -000,056,577,287.25 ----
02/11/2010 +007,265,093,186.33 ------------*********
02/12/2010 -000,104,736,856.82 ---
02/16/2010 +030,097,605,306.92 ------------********** Tue
02/17/2010 +000,408,694,886.67 ------------********
02/18/2010 +015,224,901,067.79 ------------**********
02/19/2010 +000,114,262,910.59 ------------********
02/22/2010 -000,206,249,204.22 --- Mon
02/23/2010 +000,404,218,476.39 ------------********
02/24/2010 -000,081,552,792.52 ----
02/25/2010 +034,823,775,896.06 ------------**********
02/26/2010 +007,974,774,874.74 ------------*********
03/01/2010 +088,256,071,194.67 ------------********** Mon
03/02/2010 +000,051,419,206.42 ------------*******

184,539,717,136.12 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4291499&mesg_id=4291543

[Demeter]

26. The Case against Greenspan and Bernanke By Mike Whitney

http://www.informationclearinghouse.info/article24887.htm

March 01, 2010 "Information Clearing House" - -Is there enough evidence to indict Ben Bernanke and Alan Greenspan on charges that they aided and abetted the banks and other financial institutions in the sale of fraudulent loans to investors?

That depends on whether there is sufficient proof to show whether the two men KNEW that the nation's lenders were engaged in large-scale predatory lending and chose to do nothing. As we'll see, both Greenspan and Bernanke were warned repeatedly about the mortgage/derivatives scam by credible professionals and industry regulators, but failed to act.

Here's a definition of "aided and abetted" from the 'Lectric Law Library:

"The guilt of a person in a criminal case may be proved without evidence that he personally did every act involved in the commission of the crime charged. ...if the acts or conduct of an agent, employee or other associate of the person are willfully directed or authorized by the person, or if the person aids and abets another person by willfully joining together with that person in the commission of a crime, then the law holds the person responsible for the conduct of that other person just as though the person had engaged in such conduct himself." Excerpt from The 'Lectric Law Library
http://www.lectlaw.com/def/a033.htm

Bernanke denies culpability in the meltdown--but at the same time-- eagerly points out that the Federal Reserve is the chief regulator responsible for overseeing the "large complex financial firms that pose a threat to the stability of the financial system." So, which is it? Does he accept responsibility or not? Here is a statement Bernanke made earlier in the week during an appearance before the Senate Banking Committee which may help to clarify the point.

“I think that stripping the Federal Reserve of supervisory authorities in the light of the recent crisis would be a grave mistake... we’ve learned from the crisis large complex financial firms that pose a threat to the stability of the financial system need strong consolidated supervision.... You need an institution that has a breadth of skills. It’s hard for me to understand why in the face of a crisis that was so complex and covered so many markets and institutions, you would want to take out of the regulatory system the one institution that has the full breadth and range of those skills to address those issues.”

Bernanke admits that the Fed is the 'primary regulator' that is responsible for "strong consolidated supervision" over "large complex financial firms that pose a threat to the stability." If we accept his definition, than we must also accept that the Fed should be held accountable when it abuses its authority and puts the system at risk. The record will show that, at the very least, the Fed is guilty of criminal negligence in its role of facilitating the sale of fraudulent loans to homeowners and investors. The Fed consistently refused to use its authority to reign in the banks even when their activities pushed the system towards catastrophe.

I have put together a short list of the regulators and agencies that warned Bernanke and Greenspan prior to the Lehman meltdown. (There's bound to be many I have missed) But, first, here is a brief summary of what caused the crisis by economist and author James K. Galbraith in a recent interview on New deal 2.0:

"The principal cause of the crisis was the dismantling of the system of regulation and supervision in the financial sector which had for much of the post-war period kept the most dangerous elements of that sector in check. In the absence of an appropriate system of effective supervision and regulation, what happens is that the actors in the system, who are intent upon taking the greatest degree of risk — including actors who are intent upon using fraudulent methods to increase their returns — come to dominate parts of the system. As they do that, the general methods of assessing performance in the market, specifically stock-market valuations, become counter-productive. That is to say, they invariably reward the worst actors, while they force more traditional actors, who are still respecting the old norms of conduct, into a competitively disadvantaged position. Thus the bad actors, the fraudulent actors, and the speculative extremists quickly take over.

That is what happened specifically in the origination of mortgages in the United States in the middle part of the last decade. You had a transition from a traditional method of issuing mortgages to people who could be reasonably expected to service them, to a method of originating mortgages that were sold off immediately, that were rated in a way that permitted them to be bundled and sold to fiduciaries, and where the issuer had no interest in whether the borrowers could pay or not. In fact, in some ways the lenders actively preferred people who did not intend to pay, because they could then inflate the value of the loan and earn a larger fee upfront for doing it. And in this way, not only was there a large segment of the market that was explicitly corrupt, but the equity value of homes all across the country was compromised. When these practices collapsed, so too did the home values not only of people who had bad mortgages, but also those for many people who had good mortgages, good incomes and perfectly good credit.

The result of that was a general slump in activity. The wealth and financial security of much of the American middle class disappeared. So far about a quarter of the measured wealth of the American middle class has disappeared - about $15 trillion of $60 trillion. That’s bound to have a fantastically traumatic effect on people’s consumption behavior and on their ability to get new good credit. Even if they wish to continue to extend the past pattern of borrowing in order to finance activity, they can’t do it. So, this is a very big problem. It starts with a failure to supervise and regulate the financial system, and flows on to the reaction of the broader population, which is to protect their remaining assets, to become extremely adverse to taking ordinary business and consumer risks." http://www.newdeal20.org/?p=7981

So, Galbraith believes that the main problem was "the dismantling of the system of regulation and supervision" over the last quarter century. This view is now widely shared by industry experts and economists. (That means that deregulation was a more significant factor in the crisis than the Fed's low interest rates.) The problem with this theory is that it tends to obscure the fact that the Fed STILL had the authority to step in and prevent people from getting ripped-off. Thus, "deregulation" was not the problem as much as the "failure to regulate". (which Galbraith also notes) This is an important distinction. The financial crisis was not caused by a system malfunction; it was caused by men perpetrating a crime.

Bernanke and Greenspan had a birds-eye view of everything that was going on in the market, that is, mortgage origination, off-balance sheet operations and securitization. They knew that homes were being sold to applicants who had no way of servicing the debt. They knew that hybrid mortgages were developed with the clear intention of increasing the quantity of mortgages without regard for the creditworthiness of the borrower. They knew that the lenders didn't care whether the loans blew up or not since they made their profits on upfront fees. They knew everything, and refused to act.

As it happens, many other people knew what was going on, too, but either kept quiet or were ignored by the media. Even now, when we have a much better understanding of what really took place, the media still frames the crisis-narrative in terms of a natural disaster--like an earthquake--that no one could have anticipated or prevented. This is nonsense. The housing bubble was 100% man-made. The Fed could have taken action at any time to stop the bubble from getting bigger but, instead, became the biggest cheerleader for dodgy loans and garbage mortgage-backed securities.

The media has succeeded in concealing the facts and deflecting the blame from the real perpetrators. As former bank regulator Bill Black said in a recent interview with Paul Solman on PBS News Hour, what is most shocking about this particular crisis is the appalling lack of accountability.

ZERO INDICTMENTS, ZERO CONVICTIONS

William Black: "In the savings and loan crisis... we had over 1,000 convictions of senior insiders.... At this stage among the subprime lending specialists, we have zero convictions. We have zero indictments."..."In September 2004, the FBI began publicly warning that there was an "epidemic" of mortgage fraud, and it predicted that it would produce an economic crisis, if it were not dealt with. The FBI has also said that 80 percent of the mortgage fraud losses occur when lender personnel are involved. So, Fitch looks at a small sample of these loans, finally, in November 2007....And what did they find? They said...that there was the appearance of fraud in nearly every file we examined. And they said that normal underwriting would have detected all of those frauds.

So, this is coming from the lenders overwhelmingly. They created incentive systems for the loan brokers and the loan officers that were based overwhelmingly on volume, and nothing on quality. We know that they gutted their underwriting standards. We know that you got in trouble if you were moral and tried to be a good officer and protect the organization from loss." (PBS News Hour)

Repeat: The FBI KNEW there was an "epidemic" of mortgage fraud as early as 2004. Ergo: The Fed knew. Greenspan knew. Bernanke knew. And both chose not to perform their regulatory duties to stop the swindle from continuing.

And the FBI wasn't the only one who knew either. In testimony just last month before the Financial Crisis Inquiry Commission (Jan 14, 2010) FDIC chairman Sheila Bair confirmed that she not only warned the Fed of what was going on, but cited particular regulations under which the Fed could stop the "unfair, abusive and deceptive practices" by the banks. Here is a excerpt from her damning testimony:

"PROBLEMS IN THE SUBPRIME MORTGAGE MARKET WERE IDENTIFIED WELL BEFORE MANY OF THE ABUSIVE MORTGAGE LOANS WERE MADE. A joint report issued in 2000 by HUD and the Department of the Treasury entitled Curbing Predatory Home Mortgage Lending noted that a very limited number of borrowers benefit from HOEPA's protections because of the high thresholds that a loan must exceed in order for the protections to apply. THE REPORT ALSO FOUND THAT CERTAIN TYPES OF SUBPRIME LOANS APPEAR TO BE HARMFUL OR ABUSIVE IN PRACTICALLY ALL CASES. To address these issues, THE REPORT MADE A NUMBER OF RECOMMENDATIONS INCLUDING THAT THE FEDERAL RESERVE USE ITS HOEPA AUTHORITY TO PROHIBIT CERTAIN UNFAIR DECEPTIVE AND ABUSIVE PRACTICES BY LENDERS AND THIRD PARTIES. During hearings held in 2000, consumer groups urged the Federal Reserve to use its HOEPA rulemaking authority to address concerns about predatory lending. Both the House and Senate held hearings on predatory abuses in the subprime market in May 2000 and July 2001, respectively...."

Naturally, Bair's testimony was ignored by the media.

So, the FBI knew, the FDIC knew, Fitch ratings knew, the Fed and Treasury knew. Was their anyone else who warned Greenspan and Bernanke about what was going on?

Yes, ex-Fed chairman Alan Greenspan's good friend Ed Gramlich cautioned him on the surge in predatory lending that was apparent as early as 2000. Here's an excerpt from the Wall Street Journal:

“Edward Gramlich, who was Fed governor from 1997 to 2005, said he proposed to Mr. Greenspan in or around 2000, when predatory lending was a growing concern, that the Fed use its discretionary authority to send examiners into the offices of consumer-finance lenders that were units of Fed-regulated bank holding companies.

"I would have liked the Fed to be a leader" in cracking down on predatory lending, Mr. Gramlich, now a scholar at the Urban Institute, said in an interview this past week. Knowing it would be controversial with Mr. Greenspan, whose deregulatory philosophy is well known, Mr. Gramlich broached it to him personally rather than take it to the full board.

"He was opposed to it, so I didn't really pursue it," says Mr. Gramlich. (Wall Street Journal)

So, Greenspan was even warned by a close friend and fellow Fed governor and STILL refused to act? And Congress still hasn't launched an investigation?

And, then there is this from Elizabeth MacDonald at Fox News in an article titled "Housing Red flags Ignored":

"One of the nation’s biggest mortgage industry players repeatedly warned the Federal Reserve, the Federal Deposit Insurance Corp. and other bank regulators during the housing bubble that the U.S. faced an imminent housing crash....But bank regulators not only ignored the group's warnings, top Fed officials also went on the airwaves to say the economy was "building on a sturdy foundation" and a housing crash was "unlikely."

The letters, obtained by Fox Business, were sent in 2005 and 2006 before the housing bubble burst.

As it pleaded with bank regulators to stop subprime lending abuses, the Mortgage Insurance Companies of America pointed out the red flags in analysis from the bank regulators' own staffers as well as the likes of Bear Stearns and Lehman Brothers, three years before these two Wall Street giants collapsed under the weight of bad mortgage bets.

Mortgage insurers are “deeply concerned about increased mortgage market fragility, which, combined with growing bank portfolios in high-risk products, pose serious potential problems that could occur with dramatic suddenness,” warned Suzanne Hutchinson, top executive at the Mortgage Insurance Companies of America, in 2005. Failure to adjust bank underwriting, reserves and capital to account for this growing risk “means that downturns from credit and/or interest rate events–let alone shocks–will be far more severe than” if precautions are taken, Hutchinson noted, adding that what is “disturbing to us is the fact that recent trends could lead to sudden increases in foreclosures.” ( Elizabeth MacDonald, "Housing Red flags Ignored", FOX Business News)

Even the mortgage insurance companies knew what was going on. Everyone knew. The biggest mortgage-looting operation in history, and no one even bothered to cover their tracks. What incredible arrogance.

Finally, there's this tidbit from an op-ed published in the Washington Post in 2008 by former New York governor Eliot Spitzer who accused the Bush Administration of being a ‘partner in crime’ in the subprime mortgage fiasco. Spitzer avers that the OCC launched “an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers.” Here's a clip from Spitzer's article:

"In 2003, during the height of the predatory lending crisis, the Office of the Comptroller of the Currency (OCC) invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government’s actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.

But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation."(Washington Post)

Is there any doubt that the Fed knew exactly what the Bush administration was up to? Is there any doubt that the OCC's actions resulted in tens of thousands--if not millions--of homeowners losing their homes to foreclosure?

There's no doubt at all. People were getting fleeced in broad daylight. As the primary regulator responsible for overseeing the financial system an preventing "unfair, abusive and deceptive practices", the Fed could have intervened at any time and stopped the predatory lending and exploitation. Instead, they sat on their hands and let the larceny continue uninterrupted, which proves that Greenspan and Bernanke are either criminally negligent in failing to execute their regulatory duties or complicit in aiding and abetting the banks and other financial institutions in the sale of fraudulent loans to investors and homeowners. Which is it? There needs to be an investigation to find out.

[ozymandius]

28. Gotta go.

Have a fun day watching the numbers twitch.

:hi:

[Demeter]

32. Safe day and return home!

[Demeter]

29. The High-End Market Moves Down By Eric Fry

http://dailyreckoning.com/the-high-end-market-moves-down/

The non-recovery seems to be gathering momentum. Almost every day we receive fresh evidence of economic non-growth and non-vitality.

It's true; the economy does manage to get out of bed every morning. Some folks applaud this fact and declare, "Aha! A recovery!" Other folks, like your California editor, observe that the economy usually crawls right back into bed after brushing its teeth. Your editor sees no recovery. He sees a coach potato with a very bright smile. He sees an economy that still lacks essential qualities like jobs, corporate revenue growth and credit.

The visible effects of this widespread malaise are...well...widespread. Let's take a peek at the housing market, for example.

Home sales are improving somewhat at the low-end of the market, where government-subsidized financing remains available, and where the federal government has been offering tax incentives. But the high end of the market still sticks.

"The latest existing-home sales data show transactions under $400,000 are 3% below year ago," observes economist David Rosenberg. "However sales of homes priced at $750,000 or more have declined a whopping 47%. Outside of FHA, Fannie Mae and Freddie Mac, mortgages that do not have government backing are still experiencing a credit crunch. 'Liars' who need jumbo mortgages must pay interest rates that are nearly 2 percentage points higher than conventional financing; as a result, the high-end market is not moving."

Rosenberg's observation is not entirely correct. The high-end market is definitely moving; it is moving down. This distress is not only a consequence of obvious trauma like job losses. The distress is also a result of "truth discovery" in the nation's liar loan portfolios.

* Discovery #1: People who lie about their financial health don't always make their mortgage payments.
* Discovery #2: Liar loans are not the only loans based on a fatal deception. Even many of the most honest loans from the bubble era contained this implied deception: People who WERE good credits will remain good credits.



Prime vs. Subprime Foreclosures

As we mentioned last week, "FICO, the outfit that computes your vaunted 'credit score,' has just noticed that consumers with high scores are more likely to default on their mortgages than their credit cards. Last year, the firm says, folks with FICO scores of 760 or higher defaulted on real estate loans at three times the pace they defaulted on plastic.

"Earth to FICO," we continued, "If you're in an underwater home, why wouldn't you commit strategic default and use the difference between a mortgage payment and rent on a similar home to pay down those cards? You might not even have to move if your mortgage lender doesn't want to follow through on foreclosure and book the loss!

"Still, FICO's CEO told Bloomberg TV he's stunned the phenomenon isn't limited to subprime: 'Now we're starting to see at the high end of the marketplace people with good FICO scores having serious delinquency problems.'"

Shocking.

[Demeter]

30. Cut Government Salaries Now By Rocky Vega

http://dailyreckoning.com/cut-government-salaries-now/

With the 2011 federal budget the Obama administration is adding a two percent wage increase for civilian federal workers. It doesn’t sound like much but, at a time when the total compensation for the average federal worker is double the average of a private sector worker, any increase is too much.

Here’s how Forbes describes the madness of the US government payroll:

“Imagine a company that dominates its field. It’s been No. 1 in its industry as long as anyone can remember. But lately it’s fallen on hard times. Revenue has dropped dramatically. The only thing keeping it afloat is record borrowing based on its stellar credit rating, earned many years ago.

“Meanwhile, independent analysts have shown that workers at this company earn higher than average wages. Moreover, the workers have skills that are not easily transferable.

“If this were an airline or an automaker, the solution would be a no-brainer: It would be time for a big pay cut. If the company didn’t cut pay, or increased it, creditors and investors would question the seriousness of management.”

Yet, with the above perfectly sound logic what we see is another pay increase. Forbes doesn’t claim that a payroll cut would sharply increase government savings — a 10 percent decrease would only save about $15 billion — but it would at least send the right message… that the nation’s leadership isn’t asleep at the wheel.

The complete article is worth a look, and can be found in Forbes coverage of why we should cut pay for government workers.

SOME PAIN-SHARING WOULD BE APPROPRIATE...

[fasttense]

56. Just another race to the bottom.

American CEOs have outsourced tens of millions of middle class paying jobs to countries that provide almost slave like labor and wage conditions. The result is plummeting average wages throughout America.

Yet CEO pay has jumped by 100s of percentage points since the bushes were appointed. The economy is terrible yet CEO pay keeps rising. I think we should cut their wages. Why do CEOs and executives even need bonuses? Why do they deserve to live like sultans? First cut their wages in half and then consider the little people.

As George Baily told Mr. Potter (I think Forbes needs to be told this)

"Do you know how long it takes a working man to save five thousand dollars? Just remember this, Mr. Potter, that this rabble you're talking about... they do most of the working and paying and living and dying in this community. Well, is it too much to have them work and pay and live and die in a couple of decent rooms and a bath?"

I say double every federal worker's pay and minimum wage. Let's try trickle UP economics for a change.

[Demeter]

33. Don’t Bet on a Recovery By Peter Schiff

http://dailyreckoning.com/dont-bet-on-a-recovery/


03/02/10 Westport, Connecticut – It is astounding how many economists, government officials, and Wall Street strategists construe the current economic conditions as evidence of a bona fide recovery. It is a testament to the power of the rose-colored glasses handed out by our nation’s leading universities that such a feeling could be widely held despite the clear and present danger that compounds daily. The myopia leads us to enact policies that actually exacerbate our problems. The “remedies” are postponing, perhaps indefinitely, a true recovery.

The oracles who have described the nature of this imminent recovery do so based on their conviction that consumer spending is slowly returning to levels that existed prior to the recession. New data released today seems to support this view, with consumer spending up 0.5% in January.

However, missing from their analysis is any plausible explanation as to why consumers will be able to sustain such spending given the plunge in income and credit, and the lack of available savings. In fact, the same January spending report showed that personal income increased by only 0.1%, while the savings rate slowed to the smallest since 2008.

I would challenge those who fantasize about a consumer-led recovery to describe where the spending money will come from. Most consumers are tapped out, millions are unemployed, and home equity has been wiped out. The only reasonable thing for them to do is to pay down debt and sock away as much money as possible to rebuild their savings.

Beyond the question of “how” the spending could be achieved, is the deeper question of “why” such activity should be sought at all. Excessive spending, fueled by an insane housing bubble and catalyzed by reckless monetary and fiscal policy, was the reason that our current recession became unavoidable. Why would we want to go down that road again?

During the run up to the crash, excess spending had created economic distortions that have yet to be resolved. Too many resources, including land, labor, and capital, were devoted to servicing an unsustainable economic model in which Americans borrowed money to buy homes, products and services they really could not afford. In many cases consumer behavior was influenced by overly optimistic assumptions regarding real estate related riches.

However, now that the real estate bubble has burst, Americans are coming to terms with a more sober reality. Many have cut up their credit cards, dramatically reduced their spending, and have squirreled away as much money as they can. This change in behavior should necessitate a dramatic shift in the labor market as workers move away from jobs associated with consumer spending and toward jobs associated with real production, primarily for exportable goods.

The real problem is that monetary and fiscal policy designed to re-inflate the burst spending bubble is preventing this transition from taking place. As a result we are not creating the jobs we need to replace – the ones we have lost in mortgage servicing, home improvement, and real estate sales (which we never really needed to begin with). As these jobless remain unable to find alternative employment, our economy will continue to languish.

Some will argue that the new jobs created by government stimulus spending will provide the additional purchasing power necessary to revitalize consumer spending. There are two problems with this expectation. First, those jobs being “created” by the government are outnumbered by those being destroyed by government domination of resources. Second, even if it were possible for job growth to return, having hopefully learned from their mistakes, workers will be far more frugal with their paychecks than they were in the past.

Others hope that rising real estate prices will give consumers more confidence to spend. The reality is that housing prices are still too high and will likely fall further. But even if they did rise, consumers will still be reluctant to resume their shopping spree. Home equity extraction loans, which just a few years ago turned houses into ATMs, are now much harder to come by. When it comes to spending, it’s not just about confidence; it’s about cash.

The only possible way consumers can spend is if the government gives them the money. However, since the government cannot legitimately give money to one American without first taking it from another, the most likely means of doling out cash will be to run it off the printing presses.

That, in a nutshell, is our government’s plan for economic recovery. Print a bunch of money and give it to consumers to spend. This is not a plan for recovery but a recipe for disaster. Those betting that this program can succeed in putting together a healthy and sustainable economy simply do not understand the nature of their wager. The smart money is going the other way.

[TalkingDog]

76. ABC News. But only on the internet.... because who wants to hear this on the evening news?

http://abcnews.go.com/Business/economists-warn-financial-us-economy/story?id=9990828

In the report, the panel, that includes Rob Johnson of the United Nations Commission of Experts on Finance and bailout watchdog Elizabeth Warren, warns that financial regulatory reform measures proposed by the Obama administration and Congress must be beefed up to prevent banks from continuing to engage in high risk investing that precipitated the near collapse of the U.S. economy in 2008.

The report warns that the country is now immersed in a "doomsday cycle" wherein banks use borrowed money to take massive risks in an attempt to pay big dividends to shareholders and big bonuses to management – and when the risks go wrong, the banks receive taxpayer bailouts from the government.

snip

The report blasts some of Washington's key players. Johnson writes, "Our government leaders have shown little capacity to fix the flaws in our market system." Two other panelists, Simon Johnson, a professor at MIT, and Peter Boone of the Centre for Economic Performance, voiced similar criticisms.

Federal Reserve Chairman Ben Bernanke and Treasury Secretary Tim Geithner "oversaw policy as the bubble was inflating," write Johnson and Boone, and "these same men are now designing our 'rescue.'"

[Demeter]

34. Getting On With the Depression to Make Way for Growth By Bill Bonner

http://dailyreckoning.com/getting-on-with-the-depression-to-make-way-for-growth/

03/02/10 Baltimore, Maryland – “I can’t stand it anymore. I have to say something. You act like you actually want a depression. What’s wrong with you?”

The above letter came from a dear reader who has missed the point. We are as generous and warm…as caring and sharing…as anyone outside a mental institution. We only want the best for our fellow countrymen…really.

But what is best? What’s best for the fellow who bought a house he can’t afford? Isn’t it to get out the house as soon as possible? What’s best for the fellow who didn’t save enough for his retirement? Shouldn’t he start saving as much as possible as soon as possible? And how about the banker who lent money to people who couldn’t pay it back…or the investor who put his money into projects that weren’t really very good investments? Shouldn’t they take their losses as soon as possible…and more on?

The period of time in which mistakes are recognized and corrected is called a depression. Best to get it over with.

You see, dear reader, we do not believe in the perfectibility of man and his institutions. Instead, we see material progress. Man’s machines and inventions get better. But man himself? He is what he always has been…prey to sin and folly…prone to error…and ready for a good time.

If he makes mistakes, he must correct them. If he spends more than he earns in the present, he must spend less than he earns in the future.

The Dow rose 78 points yesterday, but is still more than 200 points below its high for this rally. The euro is at $1.35 – down substantially, from its high…but still 50% above where it started. Immediately after the euro was introduced, it fell. It dropped to 88 cents. People thought it was weak and irresolute. They called it the “Esperanto currency” – referring to the artificial language invented in the 19th century and designed to unite the world. Esperanto never really caught on. People feared that the euro would never really catch on either.

But it seems to work as well as any other paper currency…at least for now. So, you see, some innovations work. Some don’t. But behind them is the old rag and bone shop of the heart… As far as we can tell, either progress of the human race is glacially slow…or there is none at all.

Even real material progress is slow. Over the last two centuries, real increases in human wealth – in the west – average out to only about 2% per year. That doesn’t leave a lot of room for error. Make a few big mistakes…such as those caused by miscues from the central banks…and you’re actually going backwards.

Are bankers really smarter, better, shrewder than they were 100 or 1,000 years ago? How about investors? Don’t they make exactly the same mistakes they always made…?

Not many humans have the luxury that we have. Here at The Daily Reckoning headquarters, we’re paid to keep our eyes open…and to try to figure out what is going on.

Of course, we’re not paid very well. Still, what a luxury it is to be able to watch… Economists on Wall Street have to answer to the big banks that employ them. Naturally, they want to show that the world is always getting better. They want their customers to buy more stocks and bonds…which will become more and more valuable, forever and ever.

And then, there are the economists working for the government. They want to prove that they can control the economy…and improve it! Otherwise, why bother to hire them?

There are other economists working for universities and colleges. What do they want to do? They want to show that they are part of the elite classes…capable of leading the country…capable of making decisions. Capable of running things. You don’t get important posts in academia by being “negative.” You don’t win the Nobel Prize in economics by saying “hey…this is all very entertaining…this economics…but there’s not really very much you can do about it.”

Here at The Daily Reckoning, on the other hand, we have no hope of getting tenure…a Nobel…or even a raise. We have no boss and no one to flatter or mislead. We answer to no one but our Dear Readers. And we don’t even pay any attention to them!

Do we want a depression? Well…yes…bring it on! But not because we enjoy seeing people lose their houses and stand in bread lines. It’s only because we know that a lot of mistakes were made during the bubble years – thanks largely to the government’s mishandling of the economy. While real, underlying wealth only grew at maybe 2% per year, people spent an extra 5% to 10%. This spending gap grew during the bubble years, effectively consuming wealth that had not been earned yet…and leading to so many capital investment mistakes that there is no way to avoid a bit of backtracking – which we recognize as a depression.

Here at The Daily Reckoning, we love depression like we love mid-winter. It clears the air…and prepares the earth for spring.
------------------------------------------------------


I'D AGREE, ONLY IF THE FOLLOWING CONDITIONS ARE MET:

UNIVERSAL SINGLE PAYER HEALTHCARE

STEEPLY PROGRESSIVE TAX ON ALL INCOME

ASSET STRIPPING OF WHITE COLLAR CRIMINALS-BANKSTERS, FRAUDS AND CONS OF ALL TYPES

FDR STYLE RELIEF AND JOB CREATION

TARIFFS AND TRADE BARRIERS TO RESTART AND SUPPORT AMERICAN MANUFACTURING

OTHERWISE, IT'S JUST A BLOODBATH. A NATION THAT WILL NOT FEED ITS PEOPLE LOSES THE RIGHT TO EXIST.

[Demeter]

36. Lloyd Blankfein is starting to worry about his legacy.

http://www.nypost.com/p/news/business/goldman_rehab_cranks_up_engine_to_rWUvoockwZr0TlUY4OQ17J#ixzz0gwOzYiOD

The 55-year-old chief executive of Goldman Sachs -- three-plus years into his tenure -- recently turned to a Texas corporate p.r. firm to buff the image of the tarnished Wall Street powerhouse.

Turning to outside consultants to gauge a firm's "perception in the marketplace" is unusual for the 140-year-old firm. But that's what you do, even if you are Masters of the Universe, when the national and international media accuse you of engineering and profiting from a back-door rescue of AIG, of using cash from a taxpayer bailout and cheap Federal Reserve financing to help finance lavish bonuses, and taking down the entire Greek economy.

Blankfein took the step of using the fancy p.r. firm, Public Strategies, sources say, because he feels Goldman has successfully weathered a storm of controversy -- by trimming the overall compensation pool to 36 percent of revenue -- and must now work to undo the damage.

Public Strategies, headed by Dan Bartlett, a confidant of George W. Bush and Karl Rove, is already on the case. Earlier this month, Goldman clients and Wall Street analysts starting filling out an exhaustive, online questionnaire seeking to pinpoint exactly what people thought of Blankfein's firm.

IS THIS A SMOKING GUN, OR WHAT?

One question wanted survey participants to compare Goldman to other Wall Street banks -- and names rivals JPMorgan Chase, UBS, Bank of America, Citigroup and Barclays. Respondents were asked to fill in blanks from least favorable to most favorable.

"For the first 139 years it wasn't that relevant to us to explain ourselves," Blankfein told Fortune recently. "And now it became very relevant and the press did an important thing for us, they pointed out to us that that was a deficiency in our strategy, not to reveal ourselves . . . I'm just trying to take pains, which we should have done all along, to make sure that people understand what we do in the world."

Sources point out that Goldman has used Public Strategies before, at least to consult on a specific, one-off deal basis.

The move to help re-burnish the image of Goldman may be tied to Blankfein's roots in workaday New York. Born in The Bronx and raised in a Brooklyn public housing project, Blankfein, the son of a US Postal Service clerk, became one of the most powerful -- and highly compensated -- people in finance.

For most of its history, Goldman had a sterling reputation for excellence -- a reputation that created a conduit to Washington and other places of power. Former Treasury Secretaries Robert Rubin and Henry Paulson, and New Jersey ex-Gov. Jon Corzine are just three in a string of Goldman employees that stretches back to the FDR administration.

Blankfein may be thinking he doesn't want to be the CEO who left Goldman's reputation in tatters.

But the storm may not be over. In recent weeks, Goldman has faced accusations that in 2001 it helped Greece engineer sophisticated securities deals -- akin to those that destroyed energy outfit Enron -- encouraging it to gorge on debt and inflate its budget deficit, and imperil the fragile Euro zone economy.

Meanwhile, for Blankfein, a former commodities trader who will celebrate 30 years at the firm next year, fixing Goldman's reputation is now a top priority. But it may be the biggest challenge of his tenure, especially since the firm has little experience answering to average folk.

By way of contrition, Blankfein conceded to taking a relatively modest bonus of $9 million this year, compared to the nearly $68 million he accepted in 2007, despite having guided the firm through its most profitable year ever.

This "restraint," as Goldman insiders referred to Blankfein's taking a pay cut, came after the firm already decided to dial back its bonus pool to around $16.2 billion from what could have been as much as $23 billion...

Read more: http://www.nypost.com/p/news/business/goldman_rehab_cranks_up_engine_to_rWUvoockwZr0TlUY4OQ17J#ixzz0h7ERvtO2

[Demeter]

37. Goldman board rejects shareholder demands on pay

http://www.reuters.com/article/idUSTRE62028M20100301

Goldman Sachs Group Inc's (GS.N) board has rejected demands from shareholders that the firm investigate recent compensation awards, recoup excessive compensation and reform pay practices...

[fasttense]

58. Which only goes to show how powerless shareholders really are. n/t

[Dr.Phool]

83. If Blackbeard only had a PR man.

[Demeter]

38. Secretary Geithner's Got Some Explaining to Do By David Yerushalmi

http://www.americanthinker.com/2010/03/secretary_geithners_got_some.html

THIS IS A REALLY BIZARRE, OUT OF NOWHERE, LAWSUIT--ANYBODY CARE TO COMMENT? I'M BAFFLED BY IT.

[Dr.Phool]

84. Strange.

[Demeter]

39. Greek Crisis: Ending (at last) the Trojan War

http://www.eurointelligence.com/article.581+M567c8704f1e.0.html

The solution to the Greek fiscal crisis will need a return to Homer’s Iliad (ending at last the Trojan War.) Despite markets’ fears, Greece will not default on its debt. Why? Because, with some diplomatic impetus, Greece could easily reduce its military spending by at least 3 points of GDP, if a multilateral peace initiative is launched between Greece, Turkey and Cyprus, with the help of the US and of the Europeans. Unlike Portugal or Ireland, Greece could benefit from significant peace dividends to reduce its titanic fiscal deficits...

MORE AT LINK

IT WOULD BE TOO MUCH TO EXPECT WARRIORS TO DECLARE PEACE AND GET OUT OF THE BUSINESS...

[tclambert]

48. Sing, O Muse, of the wrath of Achilles

Greece is still suffering for it? Wow, those gods can hold a grudge.

[Demeter]

50. Greek Memories are Better than Elephants, I Guess

and Turks will never give up a grudge.

[Demeter]

40. The Home Depot Misery Index by: Daniel Tilson

http://www.truthout.org/the-home-depot-misery-index57291


Extra, Extra. The economy still sucks. Didn't need to hear the "unexpectedly" bad news from the Labor Department about a new surge in unemployment filings to know just how many of us are hurting, and how badly.

No, all it took to "rub it in" was a trip to my local Home Depot here in Southeast Florida - a trip I made with some degree of trepidation.

As a middle-aged, self-employed family guy, I've suffered the slings and arrows of this economic meltdown, trying to keep my video production business going, trying to keep the old head above water - even as my crazy, inflated mortgage sank right under it, just like it has for so many others in Florida and nationwide.

So when my wife and I decided we couldn't put off replacing our broken, unusable garage door any longer, I headed off to Home Depot in search of a sale - and an increase in the credit line on my Home Depot credit card, which would let us pay this big ticket item off over a year, with no interest.

Long story short, I squeezed in on the last day of a 15% off sale - whoopee - but couldn't squeeze even an extra dollar of credit out of them. The wonderful gentleman working with me on the order - let's call him Robert - hung up the phone on the credit department and shook his head. "Been happening an awful lot" he said, looking into the distance through smudged glasses and scratching his balding head.

Unable (unwilling anyway) to wait any more to have proper access to our garage and its - ahem - "significant" amounts of stuff, my wife and I stitched together a Plan B on the phone, while Robert waited patiently. We were finally able to lock in the sale price of about sixteen hundred bucks - including installation - for our new gateway to…whatever the hell is in that damned garage.

It took quite a while to get the details of the order squared away, entered into the system, printed out, and when we were done I smiled and thanked Robert for his time, patience and effort, joking "That's why they pay you the big bucks, right?"

He chuckled and shook his head again, leafing through the ridiculous pile of paperwork this order had generated. "Yeah, right, twelve bucks an hour…" he muttered.

"Really? How long have you been here?" I asked.

"Almost two years."

I looked at this tall, athletic, tired-looking older man, probably pushing sixty years old, his lively, intelligent eyes peering up at me now through those foggy spectacles, a sad smile on his flushed face.

"Are you able to get by on the twelve bucks an hour?" I asked.

"No. But I'm lucky, I'm single now…and my brother helps me…" Long pause before he looks down, shuffles papers and says very quietly, "But I still just had to take most of the money out of my retirement accounts to pay all my bills" I didn't say anything. I wanted to say, "I'm sorry to hear that", but I couldn't quite get it out - and wasn't sure he wanted to hear it anyway.

After a few moments of silence, he looked up at me again and continued.

"I came out of school with a degree in Political Science - lot of good that did me - then I went back and got an MBA, a Masters in Business Administration. Finally got a good job at Northern Trust Bank. Five weeks before I would've been vested for my pension, they fired me. After that, forget about it...age discrimination, a guy in his fifties, forget about it…damned banks…"

I felt like I could jump in now. "I know, it's incredible the way the big banks and corporations just keep sticking it to us and getting away with it..."

He nodded, looking off at the mostly empty aisles of the giant store. "Yeah, they do what they want, they get what they want, and even though it's mostly Republicans that look out for them, you know what? Customers come in here so angry, working people, middle class people…and maybe they don't like the banks, but what they say are things about 'too many damned immigrants', and 'that damned Obama' ,and 'those Democrats and their socialist takeovers'…"

His voice trailed off, head shaking once again, very slowly, as he looked back up at me - a deep, piercing eye-to-eye look.

"When do people get it that they're being led by the nose now by the same ones that put 'em in the holes they're in? That's what they should be angry about..." And then another store employee came walking over, sat down, asked Robert a question...and "the moment" had passed, without my getting to respond to Robert's final, heartfelt words. He handed me a pile of paperwork regarding my order, smiled warmly and said it was great talking to me. I thanked him again, shook his hand, went and made my cobbled together payment arrangements for the new garage door.

But I've got to take this opportunity to say here what I've been thinking ever since walking away from Robert this morning. What I do know is that true public servants - Democrats, progressives, whatever the affiliation - must quickly take hold of the reins of clear, compelling mass communications, about how America got in the pickle it's in, and who's responsible. Cause it sure as hell isn't Obama, or illegal immigrants.

What I don't know, and I'm more than a little unsettled, no, unnerved to say so, is when all the angry working and middle class people Robert runs into at Home Depot are going to "get it". Soon, I hope, before our economy, our democracy, and our individual ways of life suffer any further or irreparable damage.

[UpInArms]

41. dollar watch

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

Last trade 80.315 Change -0.206 (-0.26%)

Opening Comment 03.03

http://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/opening_comment/2010-03-03-0536-Opening_Comment_03_03.html

Not a lot to talk about thus far on the day, with currencies mostly consolidating from their Tuesday rebound against the buck.

The commodity currencies continue to stand out, although we are finally starting to see some desire for profit taking in Aussie and Cad given how overextended they are against the non-USD and Yen major currencies. Sterling has made the most impressive rally today, with the single currency playing some catch-up after relatively underperforming in recent sessions. A stronger than expected consumer confidence, which rose to its highest levels in 2 years, was seen as helping to provide an added boost for the UK currency. Meanwhile in Australia, Q4 GDP came in more or less as expected, while the Y/Y number was better.

Overall, the improved sentiment within the markets has also been aided by the latest news out of Greece, with the country expected to announce details of their deficit reduction plan. S&P has added to positive sentiment after saying that it is less pessimistic on Greece than it is on the financial markets. Finally, Fed Fisher has been on the wires saying that while liquidity measures are being removed, now is not the time to begin tightening monetary policy.

Looking ahead, German retail sales (-0.6% expected) are due at 7:00GMT, followed by German and Eurozone PMIs at 8:55 and 9:00GMT respectively. UK official reserves and PMI services (55 expected) are then out at 9:30GMT, with Eurozone retail sales (-0.3% expected) capping things off at 10:00GMT. US equity futures and commodities are relatively flat.

...more...

Dollar - Another Dramatic Rally Stalls without a Definitive Risk or Fundamental Trend

http://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2010-03-03-0334-Dollar_Another_Dramatic_Rally_Stalls.html

The US Dollar made a weak attempt at repeating the rally that opened the week; but the run once again fall short of reviving the bull trend that has been sidelined for the past three weeks now. In fact, the greenback’s eventual retracement from intraday highs would threaten a more meaningful bearish reversal. Amongst the majors, notable dollar support was under pressure for EURUSD, USDJPY and AUDUSD through the end of Tuesday’s active session. This is a dramatic reversal of fortunes for the world’s most liquid currency on an intraday basis; but put in context of price action over the past few weeks, this high volatility still falls within the bounds of a well-worn range that reflects the indecisive state of underlying risk appetite that has burdened the capital markets for nearly a month now. Offering a similar assessment of investors’ taste for risk appetite in a cautious world, the Dow Jones Industrial Average would retrace nearly all of its gains through the first half of the active trading session and subsequently failed to make progress on a push above 10,400; while crude failed to capitalize on a six-week high and returned to its tight, two-week horizontal range. Yet from all three major asset classes, there was a tentative but tangible effort to jumpstart a build in speculative positioning. This promise is borne from a slow build in confidence in the outlook for growth through economic data and credible progress on some of the largest threats to global financial security. Greece is likely still the most likely source of potential trend.

As for the concrete macroeconomic offerings from the US docket today; Tuesday proved the lull of the week. There were no major market-moving indicators scheduled for release; but there was notable Fed commentary to absorb. Kansas City Fed President Thomas Hoenig (notably a voting member of the Federal Open Market Committee this year) maintained his well-known hawkish bias in remarks delivered today. Once again the policy maker criticized the Board’s for pledging an “extended period” for keeping interest rates low. Hoenig went on to suggest that an essentially zero interest rate policy was “non-sustainable” and suggested the central bank should eventually hike even if unemployment is still high. Drawing a notable contrast to the Hoenig’s warnings, Dallas Fed’s Fisher said in an interview said he was “less worried” about short-term inflation and maintained concern over the health of the economy. On the topic of the ‘extended period’ phrase, the central banker said he “wasn’t in favor of that language from the beginning;” but Fisher nonetheless maintained that rates would need to be kept low for “some time” until the economy recovers. Timing surrounding the FOMC’s eventual turn to a hawkish is no doubt a critical factor in the currency’s strength – perhaps eventually rivaling risk appetite trends – but consistent language and moves to withdrawal stimulus before turning to monetary policy has tempered hike forecasts. Fed Fund futures show a 10 percent chance of a quarter-point hike by the June 23rd meeting. Looking out over the coming 12 months, the market is pricing in a meager 58 basis points of tightening – the most dovish outlook since December 2nd.

...more...

[tclambert]

45. February North American auto sales numbers

Ford: +43.14% 142,285 cars sold
Nissan: +29.38% 70,189
BMW: +13.70% 17,971
Am. Honda: +12.71% 80,671
GM: +11.51% 141,951
Chrysler: +0.47% 84,449
Toyota: -8.72% 100,027

These numbers are from: http://www.autoblog.com/2010/03/02/by-the-numbers-february-2010-easy-being-green-edition/

This is versus the same month last year, which was a terrible year.

However, Ford's numbers are almost back to 2008 numbers, and for the first time in 12 years, Ford outsold GM. GM's percentages are still weighed down by Saturn, Hummer, Saab, and Pontiac. Buick was up 47.21%, more than any other brand name; Chevy was up 32.35%; Cadillac up 31.76%; and GMC up 26.24%. Chrysler made it into positive territory for a change. Only Toyota, with its PR nightmare of recalls, dropped from last year.

Ford still looks like the big winner, both from the recession, and Toyota's problems. Ford closed at $12.22 per share yesterday. It was $1.81 a year ago. We could have increased our money by a factor of 6.75 if we'd invested in that one. Darn, darn, darn, darn, darn.

[Demeter]

46. 15 Years Ago, the Combined Assets of the 6 Biggest Banks Totaled 17% of GDP, By 2006, 55%, Now 63%

http://www.nakedcapitalism.com/2010/03/guest-post-15-years-ago-the-combined-assets-of-the-6-biggest-banks-totaled-17-of-gdp-by-2006-55-now-63.html

You know the big banks have gotten bigger.

As Rolfe Winkler noted last September:

For the big have gotten even bigger since the start of the financial crisis. At the end of 2007, the Big Four banks — Citigroup, JPMorgan Chase, Bank of America and Wells Fargo — held 32 percent of all deposits in FDIC-insured institutions. As of June 30th, it was 39 percent.



(If the image doesn’t load, GO TO LINK .)

But Simon Johnson gives an even broader perspective on how big the too big to fails have gotten:

Fifteen years ago, the combined assets of our six biggest banks totaled 17 percent of our GDP. By 2006, that number was 55 percent. Right now, it stands at 63 percent.

Johnson also points out that:

The big four have half of the market for mortgages and two-thirds of the market for credit cards. Five banks have over 95 percent of the market for over-the-counter derivatives. Three U.S. banks have over 40 percent of the global market for stock underwriting.

As I’ve previously noted, the government created the mega-giants (they are not the product of free market competition), and their very size destroys the real economy like a massive black hole destroys the matter around it.

And as Johnson and many others have pointed out, the very size of the giant banks enables them to easily capture politicians … about as easily as the Great Attractor captures galaxies.

[tclambert]

49. Cool animation.

[Roland99]

53. In a couple of months, I'm dumping Chase and going to a small, local bank

perhaps even a Credit Union or, who knows, might go bankless!

[Demeter]

60. Bankless Is Not a Good Idea

unless you have so much moola that you can build yourself a strongbox house and never need to deal with cashing checks from other people.

But there are alternatives to Chase, for sure.

[Roland99]

67. Only check I ever need to cash would be my paycheck

It's drawn on BofA which means I'd have to give those bastards like $6-8 twice a month for the "privilege" of cashing a check drawn on THEIR deposits.

That's about the only reason I'd keep a bank just for direct deposit.

[mbperrin]

91. We've been bankless since 1978. No accounts, no loans.

We like it. We just don't take checks from other people, except my teaching job, and I take that to their bank and cash it for a $2 fee once a month. Our tenants pay all cash, as do our remodeling customers and boutique habitues.

They all think we're a bit odd, but they like their places to live, the results they get, and the merchandise they buy, so they do it.

Not for everybody, but we like it.

[Roland99]

55. Index Futures: Uncertainty abounds after yesterday's flatliner

S&P 500 1,119 +1.20 +0.11%
DOW 10,404 5.00 0.05%
NASDAQ 1,852 -0.50 -0.03%

[Demeter]

61. That was something, wasn't it?

The little engine that couldn't...well, at least it didn't drop lower than the day before....for all the huffing and puffing.

[DemReadingDU]

66. Economists: Another Financial Crisis on the Way

3/2/10 Economists: Another Financial Crisis on the Way
Nonpartisan Group Led by Nobel Winner Calls for Stronger Financial Reforms

Even as many Americans still struggle to recover from the country's worst economic downturn since the Great Depression, another crisis – one that will be even worse than the current one – is looming, according to a new report from a group of leading economists, financiers, and former federal regulators.

In the report, the panel, that includes Rob Johnson of the United Nations Commission of Experts on Finance and bailout watchdog Elizabeth Warren, warns that financial regulatory reform measures proposed by the Obama administration and Congress must be beefed up to prevent banks from continuing to engage in high risk investing that precipitated the near collapse of the U.S. economy in 2008.

The report warns that the country is now immersed in a "doomsday cycle" wherein banks use borrowed money to take massive risks in an attempt to pay big dividends to shareholders and big bonuses to management – and when the risks go wrong, the banks receive taxpayer bailouts from the government.

"Risk-taking at banks," the report cautions, "will soon be larger than ever."

Without more stringent reforms, "another crisis – a bigger crisis that weakens both our financial sector and our larger economy – is more than predictable, it is inevitable," Johnson says in the report, commissioned by the nonpartisan Roosevelt Institute.

The institute's chief economist, Nobel Prize-winner Joseph Stiglitz, calls the report "an important point of departure for a debate on where we are on the road to regulatory reform."

The report blasts some of Washington's key players. Johnson writes, "Our government leaders have shown little capacity to fix the flaws in our market system." Two other panelists, Simon Johnson, a professor at MIT, and Peter Boone of the Centre for Economic Performance, voiced similar criticisms.

more...
http://abcnews.go.com/Business/economists-warn-financial-us-economy/story?id=9990828&page=1


The Report - 146 pages
http://makemarketsbemarkets.org/report/MakeMarketsBeMarkets.pdf


3/2/10 Karl Denninger's essay...
http://market-ticker.org/archives/2027-Whadda-Ya-Mean-Its-Not-Over.html

[wordpix]

73. Nuclear projects face financial obstacles---while O admin & states pledge bailout billions

Nuclear projects face financial obstacles
http://www.washingtonpost.com/wp-dyn/content/article/2010/03/01/AR2010030103975.html

By Steven Mufson
Washington Post Staff Writer
Tuesday, March 2, 2010

Hopes for a nuclear revival, fanned by fears of global warming and a changing political climate in Washington, are running into new obstacles over a key element -- money.

A new approach for easing the cost of new multibillion-dollar reactors, which can take years to complete, has provoked a backlash from big-business customers unwilling to go along.

Financing has always been one of the biggest obstacles to a renaissance of nuclear power. The plants are expensive, and construction tends to run late and over budget. The projected cost for a pair of proposed Georgia plants would be $14 billion; the Obama administration last month pledged to provide them with $8.3 billion in federal loan guarantees.

So utilities have turned to state legislators and regulators to help contain capital costs. In states such as Georgia, Florida and South Carolina, utilities have won permission to charge customers for some of the cost of new reactors while construction is still in progress -- a financing technique that would save utilities a couple of billion dollars for each reactor. Previously, utilities had to wait until power plants were in operation before raising rates, as they still do in most states. more.....

[Dr.Phool]

79. "Capitalism: A Love Story" Comes out on DVD next Tuesday.

Full page ad on the back cover of The Nation.

[Demeter]

80. Is that why the Markets are taking a dive? Aooga! Aoooga!

Somebody pulled a plug somewhere.

[Dr.Phool]

85. And a firestorm brewing in GD.

Michael Moore said this. Michael Moore said that.

Since his movie is getting released on DVD next week, it only makes sense that he would be out promoting it.

[bread_and_roses]

86. so the little engine ran out of steam again today?

what's going on? is this as odd as it looks to me after all these months of up 100/down 100 or sudden drops and then up up up again?

[Dr.Phool]

88. I talked to a friend of mine at the dog park this morning.

He's a day trader. He said yesterday, everyone was spooked about the upcoming employment numbers. And today? Since the official numbers weren't horrendous, nobody has a clue.

[CatholicEdHead]

89. Part of the decline is the US Census

That will be keeping many people off the official rolls with a part time decent paying job from now until July or so. After this one time work is done, watch out. :scared:

[bread_and_roses]

90. thanks, Dr.P

At least it seems I'm not the only one puzzled.