STOCK MARKET WATCH, Thursday May 21

[ozymandius]

Source: du

STOCK MARKET WATCH, Thursday May 21, 2009

Bush Administration Officials Under Indictment = 2
Financial Sector Officials Under Indictment = 0
Financial Sector Officials In Prison = 2

AT THE CLOSING BELL ON May 20, 2009

Dow... 8,422.04 -52.81 (-0.63%)
Nasdaq... 1,727.84 -6.70 (-0.39%)
S&P 500... 903.47 -4.66 (-0.51%)
Gold future... 937.40 +10.70 (+1.15%)
30-Year Bond 4.15 -0.06 (-1.35%)
10-Yr Bond... 3.19 -0.05 (-1.54%)

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

Market Conditions During Trading Hours

GOLD, EURO, YEN, Loonie and Silver

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Read more: du

[ozymandius]

1. Market Observation

Atlas is Shrugging
by JAIME E. CARRASCO

“I used to think if there was reincarnation, I wanted to come back as the President or the Pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.”

~ James Carville, Campaign Advisor to President Clinton
in the Wall Street Journal, February 25, 1993, p. A1

Having navigated his political career through the 70s and 80s, James Carville understood the power of the bond market as a measure of fiscal irresponsibility. As a former bond trader myself, having learned my trade from former bond vigilantes of this period, I can also attest to the power of the sleeping giant that is just awakening from a twenty year hiatus of declining interest rates. I can also tell you that this giant awakens at the smell of profit and opportunity from one of the best bearish bond market moves to be seen in many years. Furthermore, I can assure you that this move will last for many years.

It’s funny how the pundits of Wall Street and MSNBC have neglected to mention that, from their December 2008 lows of 2.56%, yields of 30-year US Treasury Bills have risen 43% in the last five months to a high of 4.38% at the end of April. This, to me, is very bullish as it signals that bond investors are starting to review the ability of the US Government to cover their current and growing future liabilities, and the conclusion can only lead to higher yields...

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

[burf]

78. Looks as though the FDIC is

getting an early start this holiday weekend.

On Thursday, May 21, 2009, BankUnited, FSB, Coral Gables, FL was closed by the Office of Thrift Supervision (OTS) and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. Subsequent to the closure, BankUnited, a newly chartered federal savings bank, acquired the assets and most of the liabilities of BankUnited, FSB from the FDIC as Receiver for BankUnited, FSB. No advance notice is given to the public when a financial institution is closed

http://www.fdic.gov/bank/individual/failed/bankunited.html

[Demeter]

79. Good Catch! How Did You Find Out?

They're making up for taking last weekend off, or trying to save themselves the Memorial Day Weekend.

[burf]

82. Hi Demeter!

I heard a rumor, checked the FDIC site and there she was.

Hope all have a good Memorial Day Weekend.

[ozymandius]

2. Today's Reports

08:30 Initial Claims 05/16
Briefing.com 620K
Consensus 625K
Prior 637K

10:00 Leading Indicators Apr
Briefing.com 0.5%
Consensus 0.8%
Prior -0.3%

10:00 Philadelphia Fed May
Briefing.com -18.0
Consensus -18.0
Prior -24.4

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

[UpInArms]

27. Initial Claims @ 631,000 - last wk rev'd up 6,000

U.S. insured unemployment rate rises to 5.0%
8:30am Today

U.S. 4-wk. avg. continuing claims rise 131,000
8:30am Today

U.S. continuing jobless claims rise 75,000
8:30am Today

U.S. 4-wk. avg. initial claims drop by 3,500
8:30am Today

U.S. initial jobless claims fall to 631,000
8:30am Today

U.S. weekly initial jobless claims fall by 12,000
8:30am Today

[Pale Blue Dot]

46. Once again, this is being reported in the media as a "drop" in jobless claims.

The fact that continuing claims have risen to a new record for the 9th straight week is barely being mentioned.

[Hugin]

51. Yeah, I noticed that too.

Is this a concerted effort to defeat charting the unemployment rate?

This is like the eighth or ninth 'revision' in a row.

*sigh* They must think the game is working or they'd have changed it by now.

[UpInArms]

49. Philly Fed @ -22.6 - April leading econ indicators @ +1%

U.S. May Phill Fed index -22.6 vs. -24.4 April
10:01am Today

U.S. April leading economic indicators rise 1%
10:00am Today

[UpInArms]

50. April leading indicators rise; recession to ease - March rev'd to -0.2%

http://www.marketwatch.com/story/april-leading-indicators-rise-recession-to-ease

WASHINGTON (MarketWatch) -- The recession will be less intense in the near term, and there could even be small growth in the second half of the year, the Conference Board said Thursday. The index of leading economic indicators rose 1% in April - the first increase in seven months -- following a revised dip of 0.2% in March. "The question is how long before declines in activity give way to small increases. If the indicators continue on the current track, that point might be reached in the second half of the year," said Ken Goldstein, economist at the Conference Board. Of the 10 indicators that comprise the index, seven rose in April, with the largest positive contribution from stock prices. The largest negative contribution came from the real money supply.

[Hugin]

52. "the largest positive contribution from stock prices"

and as you point out...

"The largest negative contribution came from the real money supply."

So, they're gaming the system by jacking up the Financial Sector's stock prices. They don't even try to hide it anymore...
Do they?

;(

[Dr.Phool]

53. It doesn't look like stock prices are contributing much today.

[Demeter]

58. Market Hit an Air Pocket in the Bubble Economy

Don't tell me it's all air pickets. I'm well aware of that.

Michigan at 12.9% unemployment (because if they called it 13% that would be unlucky).

[ozymandius]

3. Oil drops below $62 in Asia as big rally pauses

SINGAPORE – Oil prices eased off six-month highs Thursday in Asia after rallying the day before to above $62 a barrel on a bigger-than-expected fall in U.S. crude inventories.

Benchmark crude for July delivery was down 50 cents to $61.54 a barrel by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange.

....

Crude stockpiles dropped by 2.1 million barrels for the week ended May 15, according to Energy Department's Energy Information Administration. Gasoline inventories dropped by 4.3 million barrels.

....

In other Nymex trading, gasoline for June delivery fell 0.60 cent to $1.80 a gallon and heating oil dropped 0.86 cents to $1.53 a gallon. Natural gas for June delivery slid 1.1 cents to $3.96 per 1,000 cubic feet.

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

[ozymandius]

5. Are Wall Street speculators driving up gasoline prices?

WASHINGTON — Oil and gasoline prices are rising fast as Memorial Day weekend approaches, but not because supplies are tight or demand is high.

U.S. crude-oil inventories are at their highest levels in almost two decades, and demand has fallen to a 10-year low, but crude oil prices have climbed more than 70 percent since mid-January to a six-month high of $62.04 on Wednesday.

....

This time, Wall Street speculators — some of them recipients of billions of dollars in taxpayers' bailout money — may be to blame.

-charts-

Big Wall Street banks such as Goldman Sachs & Co., Morgan Stanley and others are able to sidestep the regulations that limit investments in commodities such as oil, and they're investing on behalf of pension funds, endowments, hedge funds and other big institutional investors, in part as a hedge against rising inflation.

....

Oil contracts are traded mostly in U.S. dollars, and inflation would erode the value of oil earnings, stocks or any other asset denominated in U.S. currency. Many investors are pouring money into oil futures — contracts for future deliveries of oil at specified prices — in the belief that oil prices will rise as inflation erodes the dollar's value.

This turns oil futures contracts into a way for investors to hedge against inflation at the expense of American consumers, who have to pay more to fill their gas tanks as oil and gasoline prices rise.

http://www.mcclatchydc.com/227/story/68552.html

[Norrin Radd]

10. Good morning. I hope this story stays in the news.

[nc4bo]

11. Change? What change?

Srry. Figured while I was ranting (sorta) in another thread I'd just carry it here too.

Sick of this crap.

[Tansy_Gold]

14. And you can say it safely here

Other parts of DU, not so much.

The whole thing has made me sick.




TG

[DemReadingDU]

38. I read a few people who post elsewhere on DU

'Time for Change' writes essays every few days, in GD. Here's his latest

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x5692371

[Dr.Phool]

20. The change you can make believe in!

Careful out there. It gets pretty nasty in some of those forums.

[AnneD]

47. Morning Marketeers.......

:donut: and lurkers. I might believe in change if I could see it. But on all the major issues, I see no change at all. So to compliment Jon Stewart.......Change we can believe in (void where prohibited). x(

On the Geitner pool I am going with the trend here and voting for September. He will want to leave on a high note (que the fat lady) and I think October will follow WS history and it will be a triple witching time.

:rant: OK, Barack, I am not impressed with your A game and I hope your B game is better. I don't know if a little more time in the minors (Congress) would have helped but your looking like a lightweight with each passing day. The only reason you are looking more impressive is that you are following the village idiot-so folks have learned to lower their expectations.

I however, hold you to higher standards. You set them forth on the campaign trail. I expect you to work for me, not the corporations, and make my life and those of the rest of the middle class a little better. So far, I am sitting with the polar bears on an ice floe and we are all SOL. I am not surprised that most of Congress has sold us down the river-but I thought better of you. To change metaphors, you are the sheriff in town and yet the crooks are still robbing the bank and you are refusing to put the criminals in jail and on trial. The citizens are begging for relief and yet you continue to turn a deaf ear and blind eye.

It will soon come down to a fight or flight response from the beleaguered middle class. Those with means will take their remaining wealth and leave. Who knows what will happen after that? I don't have a crystal ball. But I know enough to say we are in deep trouble and you need to get it together. The clock is winding down and you have no more time outs.

Happy hunting and look out for the bears.

[Demeter]

59. Could You Narrow It Down to a 24 hour period? And Which September?

2009? 20010, 2012?

[Hawkowl]

62. June 2009

The technical market indicators are looking negative. I'm going with a significant market downturn in June, another rebound in late July and the mother of all collapses in September 2009.

http://www.minyanville.com/articles/ndx-spx-trend-bear-RUT/index/a/22766/from/yahoo

[AnneD]

65. Reminds me of my bobsleding days...

when we hit the rocky patch at the end of the run. It required a quilted snow suit AND a stolen down pillow tied to our butts to make it through that rocky patch with any degree of comfort.

[Tansy_Gold]

83. the ol' toboggan run. . . . . . .

A bit rocky indeed

[AnneD]

64. Howz this...

Sept 2009 at the earliest 2010 at the latest.

[Demeter]

80. If THIS Is the Change, You Can Keep It!

[tclambert]

12. "Goldman Sachs & Co., Morgan Stanley and others are able to sidestep the regulations"

That phrase sounds oddly familiar. Oh, well, I'm sure nothing terrible could happen because of it. After all, businessmen know what they're doing, and the market is self-correcting. And there's no such thing as an economic bubble.




:sarcasm: (Sadly, you have to identify the sarcasm or some people won't get the joke.)

[Hugin]

42. So, it's a private casino using public money?

Now, how come I can't get a gig like that...

Ha! Ha! You used the :sarcasm: tag! That makes it funny! :D

[tclambert]

67. Are you making fun of me? Shut up!

No, don't. I like your posts. You seem to get the circus aspect of the national economy.

As for us commoners not being able to "get a gig like that," maybe Fitzgerald was right and the rich ARE different. They certainly taste different. Most people taste like pork. The rich taste more like Iguana. ;-) (That might be hard to see. It's a wink.)

[Hugin]

57. My guess is this is where all of the 'Private Capital' in Timmeh's Bank Plan is going to come from..

Remember, all that talk over the last couple of weeks about 'Stress Tests' and such.

And... Since their efforts to raise the Gas Taxes failed... Well, they turned the dirty work over to Goldman and Co.

Only a guess, tho. One of many.

[ozymandius]

4. World markets fall after Fed sees deeper slowdown

HONG KONG – Global stock markets fell Thursday after the U.S. central bank predicted an even deeper recession in the world's largest economy.

Major Asian markets like Tokyo and Hong Kong lost about 1 percent or more, oil prices retreated from six-month highs and a weaker dollar weighed on the region's exporters. Technology shares, meanwhile, were bruised by Hewlett-Packard's dispiriting outlook for the year.

Investors in Asia to Europe were scaling back risky bets on stocks after the Federal Reserve cut its forecast for 2009, saying America's economy could shrink between 1.3 and 2 percent compared to the prior estimate of 0.5 and 1.3 percent. In an ominous sign for Asian companies that rely on U.S. consumer spending, the Fed's policymakers also said the unemployment rate could approach 10 percent.

....

As trading opened in Europe, benchmarks in Britain, Germany and Francy dropped between 1.5 percent and 2 percent. U.S. futures pointed to more gloom on Wall Street Thursday. Dow futures fell 42, or 0.5 percent, to 8,353 and S&P futures dropped 4.8, or 0.5 percent, to 895.10.

Japan's Nikkei 225 stock average lost fell 80.49 points, or 0.9 percent, to 9,264.15, and Hong Kong's Hang Seng shed 276.35 points, or 1.6 percent, to 17,199.49.

http://news.yahoo.com/s/ap/20090521/ap_on_bi_ge/world_markets

[ozymandius]

6. Auto pension trouble on horizon?

Detroit got handed one more ugly number Wednesday to slap us into the reality that we must rethink our futures. Sheet metal no longer can craft a cushy retirement. Nor can rubber, tires or seat cushions, apparently.
Advertisement

The entire auto industry -- which would include the Detroit Three, as well as other auto manufacturers and auto suppliers that offer defined-benefit pension plans -- is looking at a combined $77 billion in underfunded pension liabilities, based on the estimates of the Pension Benefit Guaranty Corp.

We do not want to alarm anyone. So make no mistake, the rug is not being pulled out from under most auto retirees. Many older retirees at General Motors Corp. and Chrysler LLC face no change in their pension payout.

But it is essential for others to know that about 45% of those underfunded pension benefits -- or about $35 billion -- would not be guaranteed in the event that all those plans in the auto industry would have to be terminated.

http://www.freep.com/article/20090521/COL07/905210697/Auto+pension+trouble+on+horizon+for+younger+retirees

[ozymandius]

9. a bit more about PBGC

from the Wall Street Journal:

The federal agency that backstops corporate pension plans reported that its deficit tripled in the last six months, to $33.5 billion. Despite the shortfall, the agency said it has enough assets to pay benefits for many years, even if the holder of one of the largest retirement programs, General Motors Corp., were to file for bankruptcy.

The news came as the Pension Benefit Guaranty Corp.'s former director invoked the Fifth Amendment in response to lawmakers' questions about possible mismanagement under the Bush administration. The PBGC's inspector general last week issued a report saying that the former director had violated prohibitions on contacting bidders that were seeking investment contracts.

....

The PBGC deficit stood at $11 billion, compared with its long-term obligations, as of Sept. 30. The agency attributed the deterioration of its finances since then to the assumption of pension-plan obligations from insolvent companies, as well as investment losses and the current low interest-rate environment.

The PBGC also warned that distressed companies are likely to terminate more pension plans, leading the agency to take on more of those obligations.

[UpInArms]

15. gear dod! is there not one thing - one stinky tiny thing - that these

criminals did not destroy loot???

:faint:

[Dr.Phool]

19. This is no longer fixable by Congress.

The government has been sold to the highest bidder.

No. Wait, I'll take that back. They're crack whores. They'll go down for anything. No bidding required.

This motherfucker took the fifth? Well, he might as well. Nobody is getting prosecuted for anything, anymore, anyway.

And even if he did, he'd get a slap on the wrist, with a 2 year sentence or something. Then a nice job at Goldman, or the Bush Library. The looting will continue. An occasional token scapegoat will surface. But, it's business as usual for the Republicrat-Industrial Complex.

[Demeter]

22. Nope. And Don't Start Fainting On Us Now

This has a long way to go before it gets any better.

[End Of The Road]

29. "...the current low interest-rate environment." Let's review...

Who is responsible for the artificially low interest rates? The Fed, perhaps? Yet when it comes to derivatives, quoting from post #8 below, "Alan Greenspan, Arthur Levitt and Robert Rubin,... all argued the market could regulate itself." Ya can't have it both ways, gentlemen.

I worked with a very small company's defined benefit plan for six years and it was enormously complicated and always underfunded. We got slammed first by the so-called "dot com" crash and then never fully recovered because of low interest rates. Eventually the company threw everything it had into the plan and shut it down. (They were able to make promises to the few affected employees, promises which they kept, so no one got hurt. Very rare, that.)

I really feel for the managers of larger pension plans, at least the "good" managers. It's almost as if conditions were deliberately put in place to screw them and make others rich. And the retirees - sheesh. "Retiree" is a word that will go the way of "telephone booth."

[Demeter]

35. U.S. pension agency's ex-chief refuses to testify

http://news.yahoo.com/s/nm/20090520/ts_nm/us_financial_pbgc_6

WASHINGTON (Reuters) – The former head of the U.S. agency that insures corporate pensions refused to testify Wednesday at a Senate hearing examining allegations that he had improper contacts with Wall Street firms.

Charles Millard, the former director of the Pension Benefit Guaranty Corp, invoked his Constitutional right to avoid self-incrimination after being subpoenaed to testify at a Senate Aging Committee hearing.

"Against the advice of senior leadership, he participated directly in picking the winners" of contracts that eventually went to BlackRock, JPMorgan and Goldman, PBGC Inspector General Rebecca Anne Batts told the hearing.

The contracts were part of a plan PBGC agreed to in early 2008 to boost its returns by investing in a broader range of instruments, including private equity, real estate and international equities.

"He engaged in extensive calling and emailing with Wall Street firms. Mr. Millard said these contacts were OK because these were his friends," Batts said.

After the hearing, a bipartisan group of six senators asked the Justice Department to explore the links between the bidders and the ex-chairman.

The agency, which insures traditional corporate pensions, said Wednesday it had a $33.5 billion deficit for the first half of fiscal 2009, worsening from a $10.7 billion deficit at the end of fiscal 2008. It sees substantial underfunding in plans by automakers, auto parts and other industries.

The agency blamed the ballooning deficit on new pension plan terminations, expectations distressed companies would turnover their retirement accounts to the government and a decline in interest rates which are used to value liabilities....

[Dr.Phool]

40. This guy has a hell of a future on Obama's economic team.

He fits right in with Summers, Geithner, Rubin, et al.

These contacts are OK, because they're his friends. They just e-mail really funny jokes to each other.

"Hey, did you hear the one about the homeless pensioner who came up with a new recipe using Alpo?"

[tclambert]

13. Wasn't that part of the plan, to let the automakers escape their "legacy costs?"

Cast the retirees adrift. Let the taxpayers take up that burden, too. The cost is still there. It just won't be reflected in the price of cars any more.

Hey, why not shift the burden of employee salaries onto taxpayers, too? And the cost of sheet metal, rubber, and plastic? Cars could be a LOT cheaper.

[Demeter]

23. Instead of Free Ponies, Free Cars!

[ozymandius]

7. Sony to halve suppliers

TOKYO (Reuters) - Sony Corp will halve the number of its suppliers in the next two years and aims to slash procurement costs by 20 percent this year, it said on Thursday, stepping up restructuring efforts amid mounting losses.

Analysts saw the move as positive. It comes on top of a plan to cut fixed costs by more than 300 billion yen ($3.16 billion).

But Sony shares fell more than 1 percent along with those of other exporters, hurt by a firmer yen.

Sony, which competes with Samsung Electronics in flat TVs and Canon Inc in digital cameras, has been overhauling operations as it expects a second straight year of losses due to weak global demand for consumer electronics goods.

http://www.reuters.com/article/technologyNews/idUSTRE54K1VI20090521

[ozymandius]

8. Fighting Derivatives Regulation

from The Big Picture:

Astonishing:

“Brooksley Born, the former U.S. commodities regulator who lost the fight to police over-the- counter derivatives a decade ago, said the banks that caused the financial crisis are trying to stop the overhaul of the market.

“Special interests in the financial-services industry are beginning to advocate a return to business as usual and to argue against any need for serious reform,” Born said today as she accepted a Profile in Courage award from the John F. Kennedy Library. If changes aren’t made “we will be haunted by our failure for years to come,” she said.

As the chairwoman of the Commodity Futures Trading Commission in 1998, Born warned that the unregulated contracts posed a serious danger to the global financial system and moved to address changes in how swaps based on interest rates, commodities or currencies were traded. She was stopped by Alan Greenspan, Arthur Levitt and Robert Rubin, who all argued the market could regulate itself.

Lax oversight contributed to the failures last year of Lehman Brothers Holdings Inc. and American International Group Inc., leading to the seizure of credit markets and causing more than $1.4 trillion in writedowns amid the worst financial crisis since the Great Depression. Treasury Secretary Timothy Geithner has promised that the U.S. will for the first time regulate over-the-counter derivatives, which are a major source of bank profits.”

And the nation of sheeple, briefly disturbed from their somnolence, returned to watching American Idol . . .

[UpInArms]

16. dollar watch

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

Last trade 81.239 Change +0.049 (+0.06%)

Risk Appetite and Dour FOMC Projections Weigh on Dollar's Future

http://www.dailyfx.com/story/topheadline/Risk_Appetite_and_Dour_FOMC_1242866481671.html



The Economy and The Credit Market



The dollar has benefited in the past through the fundamental beliefs that the world’s most liquid currency was a key safe haven and that the US would lead the global economic recovery. Neither theme has been working in the dollar’s favor this past week. While the market’s primary focus is still shifting from risk to return; it is more and more apparent that after nearly six months sans a global crisis, investors are diversifying their capital away from governmentally-stifled American assets to those countries that can rally more readily. Though, perhaps the more prominent driver for the greenback (and the currency market as a whole) comes from the market’s renewed appetite for yield. Speculators are trying to forecast which economy is recovering the quickest while sustaining the least amount of damage in the interim. At one point, traders were assigning that title to the US; but policy and growth forecasts have begun to undermine this conviction. Just today, the Fed minutes downgraded their forecasts for domestic output while Geithner warned that market conditions still required the government’s presence to maintain stability.

...more...

Currencies Starting to Pay Attention to Lower Equities

http://www.dailyfx.com/story/bio2/Currencies_Starting_to_Pay_Attention_1242904540980.html

The fallout from the downbeat Fed Minutes continues into Thursday with market sentiment shifting as global equities start to pull back. However, currencies remain relatively well bid against the Greenback, with the exception of Sterling and Aussie which are both notably lower on the day. Earlier this morning in a surprise announcement, S&P downgraded their outlook to negative from stable for the UK economy which caught many off guard and was used as a good opportunity for profit taking on long positions. This easily offset any positive reaction from the better than expected retail sales, with the higher PSNCR, disappointing business investments, and weaker BoE trends in lending report also helping to weigh. In response to the S&P downgrade, a spokesperson for the government said that it would look to halve the deficit in 5 years time. Aussie fell in sympathy to the GBP moves, with the recent news that Moody’s had downgraded its Queensland AAA rating to AA1 resonating with traders. In the Eurozone, PMI data was across the board better than expected with the manufacturing component standing out, crossing above 40 for the first time since October 2008. Price action in Usd/Jpy has been interesting with the market rallying ahead of the NY open back to daily opening levels by 95.00 after falling to 94.30 overnight. There was some talk of BoJ rate checks which could have been helping to bolster the pair. Looking ahead to the North American session, US initial jobless claims (625k expected) and continuing claims (6650k expected) are due at 12:30GMT, along with Canadian international securities transactions (4.0B expected) and wholesale sales (-0.8% expected). RPX housing data follows at 13:00GMT, while the Philly Fed (-18.0 expected) and leading indicators (0.8%) expected are due at 14:00GMT. On the official circuit, Treasury Secretary Geithner testifies in front of the House Financial Subcommittee at 14:00GMT. Fed Plosser speaks to investors in New York at 23:00GMT, while Fed Rosengren speaks in Massachusetts at 23:30GMT. Oil is trading lower today with some sourcing the retreat to rumors that OPEC will not cut production at next week’s summit. US equity futures point to a lower open.

...more...

[Ghost Dog]

72. Dollar falls to 2009 low as debt worries rise

NEW YORK, May 21 (Reuters) - The dollar on Thursday plunged to its lowest level this year against major currencies, and the euro approached a five-month high above $1.39 as worries about swelling U.S. deficits soured investors on U.S. assets.

Standard & Poor's announcement that it could downgrade Britain's triple-A credit rating initially weighed on sterling. But Pacific Investment Management Co's Bill Gross said fear the United States may face the same predicament slammed the dollar and drove the 10-year Treasury yield near a two-week high.

...

The euro was up 1 percent at $1.3899 <EUR=>. Earlier, it hit $1.3923, its highest level since early January. The dollar was down 0.6 percent at 94.25 yen, near a two-month low beneath 94 yen <JPY=>. An index gauging the dollar's strength against a basket of six major currencies hit its lowest level this year. .DXY S&P's warning on the UK initially lifted the dollar by some 3 cents against sterling, but the pound recovered and hit a 6-1/2-month high near $1.59 before easing back to $1.5861 <GBP=>, up 0.8 percent from late Wednesday.

...

U.S. Treasury Secretary Timothy Geithner said Thursday he considers maintaining a strong dollar and confidence in the economy his "basic obligation."

The dollar has fallen every day this week against the euro and sterling, and it marked its third straight decline against the yen on Thursday.

Earlier this week, analysts attributed the fall in the dollar, which has been treated as a lower risk, safe-haven investment, to growing optimism that the worst of the financial crisis has passed, causing investors to unwind positions in favor of the U.S. currency built up when fear was widespread, credit was frozen and stock markets were in free fall.

...

But with less need to buy dollars as a safe haven, analysts said investors were finding it harder to ignore the effect of the Federal Reserve's zero interest rate policy and its efforts to keep long-term rates low through direct purchases of U.S. government debt.

Barclays Capital strategist Steven Englander said that's particularly so when central banks in the euro zone, Canada and Australia have stuck with policies less likely to increase deficits or inflation, lending support to their currencies. "If growth is highly dependent on extremely low interest rates and an unprecedented set of monetary and fiscal policies that require issuing of a lot of Treasuries for a long time," that will not bode well for the dollar in the long run, Englander said.

/... http://www.reuters.com/article/marketsNews/idUSN2130709520090521?rpc=401&=undefined&sp=true

[Ghost Dog]

76. Dollar Decline Takes on ‘Life of Its Own,’

May 21 (Bloomberg) -- The dollar’s drop is broadening amid the thaw in credit markets and investor concern about the effects of the Federal Reserve’s asset-buying program, according to Royal Bank of Scotland Group Plc. “The decline in the dollar has developed more a life of its own this week, extending to major currencies even as U.S. equities have flattened out,” Greg Gibbs, a foreign-exchange strategist at RBS in Sydney, wrote in a research note today. “The broader thematic is that simply the U.S. was and is pursuing a relatively easy monetary policy that tends to create inflation pressure.”

The dollar lost 9.7 percent against the euro since reaching its highest level this year on March 3. It weakened 6 percent versus the yen since peaking on April 6.

...

Credit markets are showing signs of thawing after the Fed committed $12.8 trillion to drag the U.S. economy out of its longest recession since the 1930s. The London interbank offered rate, or Libor, for three-month dollar loans more than halved this year, falling today by the most since March 19. At the same time, the Fed is buying government bonds to further reduce borrowing costs after cutting interest rates to a record low.

/... http://www.bloomberg.com/apps/news?pid=20601083&sid=ala0U5in9.gs&refer=currency

[UpInArms]

17. From the just STFU dept: U.S. economy improved, banks need funds: Greenspan

http://www.reuters.com/article/businessNews/idUSTRE54K0XR20090521?feedType=RSS&feedName=businessNews

SINGAPORE (Reuters) - Former Federal Reserve Chairman Alan Greenspan said the U.S. economy and financial markets had improved but warned that banks faced a capital shortfall, which could stall lending and obstruct a recovery, Bloomberg reported on Thursday.

"Things have unquestionably improved," Greenspan was quoted as saying in an interview published on Bloomberg's website. "They've improved everywhere in the world. It's remarkable."

"There is still a very large unfunded capital requirement in the commercial banking system in the United States and that's got to be funded," he added.

The comments come after the Treasury Department and top banking regulators earlier this month released the result of regulatory "stress tests" of banks, using a hypothetical scenario that assumed a deepening recession.

The tests showed a combined capital shortfall of $74.6 billion for a group of 10 banks which was found to require extra funding. Each bank must submit a capital-raising plan by June 8, and then has until November 9 to implement it.

According to Bloomberg, Greenspan also said there was still potential for a mortgage crisis and that the financial crisis was not over: "Until the price of homes flattens out we still have a very serious potential mortgage crisis."

Greenspan, who headed the U.S. central bank until 2006, also warned of the risks arising from the ongoing slump in home prices, which was threatening millions of borrowers.

"We're on the edge and if this thing doesn't get resolved quickly I'm worried." He added that prices would only stabilize once the liquidation rate of single-family homes had peaked and that that had not happened yet.

...more...

Why doesn't this washed up has been partisan lying piece of shit just die?

[Demeter]

25. Greenspan Has to Be on Drugs, or Senile

or a crook. Or all three, would be my guess.

[UpInArms]

18. Lehman Brothers questioned over securities sales: report

http://www.reuters.com/article/businessNews/idUSTRE54K0D320090521?feedType=RSS&feedName=businessNews

NEW YORK (Reuters) - Regulators have questioned former Lehman Brothers Holdings (LEHMQ.PK) executives over their marketing of auction-rate securities, the Wall Street Journal reported, citing people with knowledge of the matter.

Prosecutors from the U.S. attorney's office in Brooklyn and Securities and Exchange Commission lawyers have interviewed several former Lehman employees about the securities, to try to determine whether these people defrauded customers, the newspaper said.

The securities were billed as safe, cash-like instruments bought and sold in weekly or monthly auctions. Big banks stopped supporting these auctions in early 2008 as investor demand for the debt dried up, part of a wider slump in financial markets.

...more...

so the regulators ... ummm.... where were those guys for the past 12 years????

[Robbien]

21. Fuld Resigns as Lehman’s Chairman

May 14,2009

Mr. Bryan Marsal
Alvarez & Marsal
Co-Chief Executive Officer
1271 Sixth Avenue
35th Floor
New York, NY 10020

Dear Bryan:

As you know, I agreed at your request to continue to serve as Chairman of the Board of Directors of Lehman Brothers Holdings, Inc. for a reasonable transition period to assist Alvarez & Marsal.

I believe that we have worked together effectively in achieving an appropriate transition. Accordingly, I believe it is now time for me to move on and to resign as Chairman of the Board.

Please consider this letter as my resignation as Chairman of the Board of Directors of Lehman Brothers Holdings, Inc. effective May 15, 2009. I will, of course, be available to assist you in any way I can.

Sincerely,
/s/ Richard S. Fuld, Jr.

http://dealbook.blogs.nytimes.com/2009/05/20/fuld-resigns-as-lehmans-chairman/


Well, that's that then.

[Demeter]

26. I Thought Lehman's Was Dead Already

[Robbien]

28. There apparently was some money tucked away in a few dark corners

which of course was used to pay Fuld his BoD salary. Appears the last dime is gone, and so is Fuld.

[Demeter]

32. Silly Me! Of Course!

[Hugin]

43. Well, actually it was hanging on the walls in the form of 'Art'... IIRC.

Hidden in plain sight.

[Hugin]

44. The 'Holding' company still exists.

That's the trouble with these 'too-large-to-fail' Onions.

They're designed to be immortal. They just spin off the losses in some unsuspecting fool's lap. It used to be via an IPO... But, lately they just give Timmeh a call.

[tclambert]

68. Article says Fuld got another job with "Matrix Advisors."

No doubt on Agent Smith's side, hunting Neo and Morpheus.

[willing dwarf]

24. Love that cartoon

Only it's not funny, just sickeningly true!

[tclambert]

74. Cheney was supposed to be the smart one. And yet has anyone gotten more wrong

on the most important matters, ever?

Some Cheney quotes from Wikiquote http://en.wikiquote.org/wiki/Dick_Cheney

- Reagan proved that deficits don't matter.
- The important thing here to understand is that the people that are at Guantanamo are bad people. I mean, these are terrorists for the most part.
- Principle is OK up to a certain point, but principle doesn't do any good if you lose.
- Let us rid ourselves of the fiction that low oil prices are somehow good for the United States.
- We believe he (Saddam Hussein) has, in fact, reconstituted nuclear weapons.
- My belief is, we will, in fact be greeted as liberators.
- If we’re successful in Iraq, if we can stand up a good representative government in Iraq, that secures the region so that it never again becomes a threat to its neighbors or to the United States, so it’s not pursuing weapons of mass destruction, so that it’s not a safe haven for terrorists, now we will have struck a major blow right at the heart of the base, if you will, the geographic base of the terrorists who have had us under assault now for many years, but most especially on 9/11.
- The senator has got his facts wrong. I have not suggested there's a connection between Iraq and 9/11.
- We'll find ample evidence confirming the link, that is the connection if you will between al Qaida and the Iraqi intelligence services. They have worked together on a number of occasions.
- We now know that Saddam Hussein had the capacity to produce weapons of mass destruction.... We know he had the necessary infrastructure because we found the labs and the dual-use facilities that could be used for these chemical and biological agents. We know that he was developing the delivery systems — ballistic missiles — that had been prohibited by the United Nations.
- What we did in Iraq was exactly the right thing to do. If I had it to recommend all over again, I would recommend exactly the same course of action.
- I think they're in the last throes, if you will, of the insurgency.
- I guess if I look back on it now, I don't think anybody anticipated the level of violence that we've encountered.
- Wolf, you can come up with all kinds of what-ifs; you've got to deal with the reality on the ground. The reality on the ground is, we've made major progress. We've still got a lot of work to do. There's a lot of provinces in Iraq that are relatively quiet. There's more and more authority transferred to the Iraqis all the time.... Bottom line is that we've had enormous successes and we will continue to have enormous successes.
- If the Democratic policies had been pursued over the last two or three years...we would not have had the kind of job growth we've had. (Wait, he might have gotten that one right, just in the opposite way of what he meant.)
- Simply stated, there is no doubt that Saddam now has weapons of mass destruction.
- If you take down the central government of Iraq, you can easily end up seeing pieces of Iraq fly off. It's a quagmire if you go that far. The question for the President, in terms of whether or not we went on to Baghdad and took additional casualties in an effort to get Saddam Hussein was, How many additional dead Americans was Saddam worth. And our judgment was, Not very many, and I think we got it right. (That was in 1994, and later events seemed to have proven this statement correct.)

Here are a few from http://politicalhumor.about.com/od/stupidquotes/a/cheneyquotes.htm

- There are a lot of lessons we want to learn out of this process in terms of what works. I think we are in fact on our way to getting on top of the whole Katrina exercise.
- Conservation may be a sign of personal virtue but it is not a sufficient basis for a sound, comprehensive energy policy.
- In Iraq, a ruthless dictator cultivated weapons of mass destruction and the means to deliver them. He gave support to terrorists, had an established relationship with al Qaeda, and his regime is no more.
- We know he's been absolutely devoted to trying to acquire nuclear weapons, and we believe he has, in fact, reconstituted nuclear weapons.

and from http://www.mcclatchydc.com/opinion/story/68079.html

- It's been pretty well confirmed that he did go to Prague and he did meet with a senior official of the Iraqi intelligence service in Czechoslovakia last April, several months before the attack.

And lastly:

- I'm sorry. I'm so very, very sorry for all the evil I've done to America and the world. I got it all wrong, all of it, all so terribly, horribly wrong. And I humbly apologize to every human being everywhere. (Okay, he didn't say that. It's just from my own imagination. Sigh.)

[snot]

84. Actually, I think Cheney is f-cking brilliant, and a psychopath –

a v. successful one.

[Demeter]

30. Investors rebel over Shell executive pay

http://www.ft.com/cms/s/0/682182cc-4480-11de-82d6-00144feabdc0.html

A global investor backlash over executive pay escalated on Tuesday when shareholders turned on Royal Dutch Shell and voted against its executive pay plan.

In one of the biggest investor rebellions over directors’ pay, about 59 per cent of the oil multi­national’s shareholders voted down the company’s remuneration report.

They objected to the discretionary award to executive directors of bonuses for 2006-08 performance, which were made even though the company failed to meet targets.

The scale of the No vote was strong evidence of the growing anger over remuneration and bonuses among shareholders, who have been criticised by regulators and politicians in the wake of the financial crisis for failing to hold boards to account...The protest was the second straight year that Shell and investors have clashed over pay and follows disputes between shareholders and companies including BP, Xstrata, Heineken and Volvo .

Institutional investors from the US, Europe and Canada, including Franklin Mutual as well as Standard Life Investments, lined up at Shell’s annual meeting in The Hague and London to speak out against the report. Their biggest objection was the decision of the remuneration committee, led by Sir Peter Job, to award the performance bonuses...

The Shell No vote was the second biggest against a UK company’s remuneration report this year, topped only by the 80 per cent of votes cast against Royal Bank of Scotland, according to Manifest, the voting agency.

RiskMetrics, the proxy voting agency that advised investors to vote against Shell’s report, said investors were uniting on pay issues in the UK and much of the rest of Europe. “When dialogue has clearly failed, shareholders are now prepared to vote against,” said Jean-Nicolas Caprasse, its head of European and Middle Eastern business.

Votes on remuneration reports are not binding. But Jorma Ollila, chairman, said: “We take the outcome of this vote very seriously and we will reflect carefully upon it.” He said the group would accelerate its timetable of meetings with big shareholders.

NEXT TIME, MAKE IT BINDING. THIS GIVES THE US SOMETHING TO SHOOT FOR.

[Demeter]

31. BofA seeks to repay $45bn by end of year

http://www.ft.com/cms/s/0/74f80dca-4568-11de-b6c8-00144feabdc0.html

Bank of America wants to pay back $45bn in bail-out funds by the end of the year, in a faster-than-expected move made possible by an accelerated programme to raise capital.

BofA is on track to raise more than $35bn in capital by the end of September, say people familiar with the matter, which it must do before paying back the $45bn bail-out money it received under the Troubled assets relief programme.

BofA’s desire to repay its Tarp money early will surprise the market. Most analysts expect BofA to be one the last banks to do this, partly because of the large amount of the funds it received and partly because it was found to have the biggest capital shortfall of any US bank in recent regulatory stress tests....

People familiar with the bank’s plans say negotiations to sell some of BofA’s non-core assets are under way and, if the asset sales occur in the next few months, the bank will be able to fulfil its stress-test obligations and pay back Tarp funds from its $173bn cash reserves.

BofA believes it can raise $6bn to $7bn of after-tax capital from the sale of assets such as private bank First Republic, administration group Financial Data Services and insurer Balboa, say people familiar with the matter. The bank could also convert $9bn in preferred shares and as much as $2bn-plus in deferred tax gains.

AND THAT WILL MAKE US ALL SQUARE? I DON'T THINK SO!

[Ghost Dog]

33. U.K. May Lose AAA Rating at S&P as Finances Weaken

May 21 (Bloomberg) -- Britain may lose its AAA credit rating for the first time as government finances deteriorate in the worst recession since World War II. Standard & Poor’s lowered its outlook on Britain to “negative” from “stable” and said the nation faces a one in three chance of a ratings cut as debt approaches 100 percent of gross domestic product. The pound fell the most in four weeks against the dollar, the FTSE 100 Index slid as much as 2.8 percent and the cost of insuring U.K. debt against default rose.

Britain needs to sell a record 220 billion pounds ($344 billion) of bonds in the fiscal year through March 2010 as the economy contracts and Chancellor of the Exchequer Alistair Darling predicts that the budget deficit will reach 175 billion pounds, or 12.4 percent of GDP. The U.K.’s worsening Gordon Brown finances parallel the public perception of Prime Minister, whose Labour government has trailed the Conservative opposition for more than a year in polls.

...

Britain would become the fifth western European Union nation to lose its rating because of the economic slump, following Ireland, Greece, Portugal and Spain. The U.K.’s debt load next year will be 66.9 percent of GDP, exceeding Canada’s 29.1 percent and Germany’s 58.1 percent, according to April 22 forecasts by the International Monetary Fund. The U.S. will be at 70.4 percent, and the 16-nation euro area at 69 percent, according to the IMF.

...

Brown’s efforts to patch up the nation’s finances are being hobbled by an economy mired in its first recession since 1991. Unemployment surged to 2.2 million in March, the highest since 1996, and tax income has dropped 10 percent in the past year. The IMF expects gross domestic product to contract 4.1 percent this year, the most since World War II.

British Land Co., the largest office developer in London, reported a record annual loss of 3.9 billion pounds today as property values slumped across the nation’s capital. There are no U.K. companies with AAA ratings by S&P or Moody’s Investors Service. British Land is rated BBB by Fitch Ratings, its second-lowest investment-grade ranking.

The difference in yield, or spread, between U.K. 10-year bonds and equivalent German securities widened six basis points to 21 basis points following the S&P statement. As recently as March 19, gilts yielded less than bunds.

...

The FTSE index declined the most since March 30. The pound dropped 0.7 percent to $1.5639 and weakened 0.7 percent against the euro to 88.07 pence. Credit-default swaps on U.K. debt rose 5.5 basis points to 78, according to CMA DataVision prices.

European governments are increasing borrowing to bolster ailing economies and bail out banks reeling amid the fallout from the global credit crisis. Ireland had its AAA credit rating removed by S&P on March 30. S&P lowered the ratings of Spain, Portugal and Greece in January.

“We have revised the outlook on the U.K. to negative due to our view that, even assuming additional fiscal tightening, the net general government debt burden could approach 100 percent of gross domestic product and remain near that level in the medium term,” S&P analysts led by David Beers in London, said in the report today.

The British economy, the second largest in Europe, shrank 1.9 percent in the first quarter, the biggest contraction since 1979, when Margaret Thatcher became Prime Minister, the Office for National Statistics said on April 24. Darling said in his budget the economy will slump about 3.5 percent this year, before expanding in 2010.

...

Brown needs to increase borrowing to pay for rescuing banks that have reported $121 billion in credit-related losses and writedowns since the start of 2007. The government pledged 40 billion pounds to bail out lenders and hundreds of billions of pounds in loan guarantees.

/... http://www.bloomberg.com/apps/news?pid=20601087&sid=aFy7olAsHDQU&refer=worldwide

[Ghost Dog]

36. Weak UK housing data overshadows positive retail news

LONDON - A surprise rise in Britain's monthly retail sales was overshadowed on Thursday by weak housing market data and a threat that the country's debt rating will be downgraded due to a borrowing blowout.

While the retail data suggests consumer spending is holding up despite the recession, economists said rising unemployment and the prospect of higher taxes to feed the hole in the public finances are likely to clip the wings of any recovery.

"It remains hard to see this strength lasting," said Capital Economics economist Vicky Redwood of the Office for National Statistics report, which showed overall sales rising 0.9 per cent and nonfood sales 1.5 per cent in April. "And the news on the rest of the economy was much weaker."

Redwood said people may have been spending the boost to their real incomes from falling inflation and interest rates in recent months, but the boost to income growth from lower mortgage payments is fading while the drag from rising unemployment and pay freezes is building.

The sales data was countered by a report from the Council of Mortgage Lenders revealing that mortgage lending fell nine per cent over the same month, dampening hopes that the housing market was improving.

/... http://www.canadianbusiness.com/markets/headline_news/article.jsp?content=b212715322

[Robbien]

37. If the UK can be hit with this, what's to stop it happening to the US?

I read that there is now a swap market on US debt instruments. Doesn't the fact that these swaps now exist mean people are betting against solvency of the instruments.

[Ghost Dog]

41. Well, the two countries' economies are said to share similar traits -

strong financial markets orientation; outsourced manufacturing; diminishing exports; supply-side service economics; large deficits and debts...

But isn't 'reserve currency' status allied with the printing press supposed to somehow protect the US?

[Hugin]

45. antigop posted a theory that this is a deliberate outcome.

As a justification for privatizing Social Security.

I tend to agree...

[DemReadingDU]

73. where is antigop?

hope all is ok, kinda abruptly left a couple weeks ago

:shrug:

[Demeter]

34. Smaller US banks need additional $24bn

http://www.ft.com/cms/s/0/79c47ffa-4306-11de-b793-00144feabdc0.html

Small and medium-sized US banks must raise some $24bn to meet the capital standards set by the government in its stress tests of large institutions, research for the Financial Times shows.

News of the potential capital shortfall could increase pressure on many of the 7,900 US banks that form the backbone of the US financial system.

As many as 500 more banks could close, according to investment bank Sandler O’Neill, which carried out the research.

Since this month’s release of the tests for the 19 largest banks, regulators and investors have increased their focus on the next tier of lenders, amid concerns some of them might struggle to survive if the economy worsens.

The government’s stress-case would result in capital shortfalls for 38 per cent of the 200 banks below the 19 largest financial institutions, leading to a deficit of around $16.2bn in common equity, according to Sandler O’Neill.

Applying similar criteria to the remaining 7,700 banks in the US would result in a further $7.8bn capital deficit.

The banks have to repay a combined $27bn in aid from the Troubled Asset Relief Programme (Tarp) but they could do that from internal resources rather than raising more funds.

The US Treasury has said that it does not intend to extend the stress tests beyond the 19 top institutions it examined. But analysts say that the public release of the government’s test methodology and capital adequacy philosophy means that the tests’ standards will become a model for the rest of the US banking system. “This will ultimately migrate down the banking industry no matter what Treasury says,” said Robert Albertson, chief strategist at Sandler O’Neill. “It’s like telling bank examiners to close their eyes and not to think of a chicken.”

The government found 10 of the largest 19 US financial institutions in need of additional capital earlier this month, identifying a $74.6bn combined shortfall.

The application of the large bank stress tests could make some smaller banks vulnerable, say analysts. Some smaller banks may either struggle to raise capital or have less flexibility to do so. That, in turn, could lead to a flurry of takeovers.

“At some point there’s going to be massive consolidation,” said one industry banker. ”But for now, a lot of banks are going to raise as much capital as they can.”

[Festivito]

39. Debt: 05/19/2009 11,293,355,611,258.51 (UP 6,762,295,407.47) (Up little, mostly FICA.)

Debt: 05/19/2009 11,293,355,611,258.51 (UP 6,762,295,407.47) (Up little, mostly FICA.)
(It's a lull in the US debt weekdays. If true to form, we'd see a rise come 3PM on Friday showing Thursday's report. Good morning all.)

= Held by the Public + Intragovernmental(FICA)
= 6,982,204,089,081.65 + 4,311,151,522,176.86
UP 244,659,127.63 + UP 6,517,636,279.84

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.26 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.79, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,381,343 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,860.45.
A family of three owes $110,581.36. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 to 32 days.
The average for the last 22 reports is 4,892,710,557.96.
The average for the last 30 days would be 3,587,987,742.51.
The average for the last 32 days would be 3,363,738,508.60.
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$/day.
There were 82 reports in 119 days of Obama's part of FY2009 averaging 0.05B$ per report, 0.11B$/day so far.
There were 157 reports in 231 days of FY2009 averaging 8.08B$ per report, 5.49B$/day.

PROJECTION:
There are 1,342 days remaining in this Obama 1st term.
By that time the debt could be between 13.1 and 18.7T$.
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)
05/19/2009 11,293,355,611,258.51 BHO (UP 666,478,562,345.43 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 1,268,630,714,346.10 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/28/2009 +000,154,949,620.57 ------------********
04/29/2009 -034,727,762,120.64 -
04/30/2009 +079,347,503,951.43 ------------**********
05/01/2009 -003,202,605,992.57 --
05/04/2009 +000,068,750,275.89 ------------******* Mon
05/05/2009 +000,122,936,524.80 ------------********
05/06/2009 -000,058,764,073.21 ----
05/07/2009 +027,679,213,817.18 ------------**********
05/08/2009 -000,216,334,016.92 ---
05/11/2009 -000,029,759,155.68 ---- Mon
05/13/2009 -000,207,515,478.68 ---
05/14/2009 +013,927,016,419.76 ------------**********
05/15/2009 +013,064,365,189.63 ------------**********
05/18/2009 -000,012,816,531.74 ---- Mon
05/19/2009 +000,244,659,127.63 ------------********

96,153,837,557.45 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,628,723,807,999.44 in last 243 days.
That's 1,629B$ in 243 days.
More than any year ever, including last year, and it's 160% of that highest year ever only in 243 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 243 DAYS NOT 365.

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

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3885143&mesg_id=3885150

[Festivito]

70. Debt: 05/20/2009 11,285,462,042,449.61 (DOWN 7,893,568,808.90) (Up little, mostly FICA.)

(It's a lull in the US debt weekdays. If true to form, we'd see a rise come 3PM on Friday showing Thursday's report. Will see. Good day all.)

= Held by the Public + Intragovernmental(FICA)
= 6,982,626,272,295.82 + 4,302,835,770,153.79
UP 422,183,214.17 + DOWN 8,315,752,023.07

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

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 306-Million person America.
If every American, man, woman and child puts in $3.26 each THAT'S 1B$.
A family of three: Mom, Dad, Child: $9.79, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 14 seconds we net gain a another American, so at the end of the workday of this report, there should be 306,387,515 people in America.
http://www.census.gov/population/www/popclockus.html
Currently, each of these American's owe $36,833.95.
A family of three owes $110,501.85. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 22 reports in the last 30 days.
The average for the last 22 reports is 4,367,251,100.77.
The average for the last 30 days would be 3,202,650,807.23.

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$/day.
There were 83 reports in 120 days of Obama's part of FY2009 averaging -0.05B$ per report, 0.05B$/day so far.
There were 158 reports in 232 days of FY2009 averaging 7.98B$ per report, 5.43B$/day.

PROJECTION:
There are 1,341 days remaining in this Obama 1st term.
By that time the debt could be between 13.1 and 18.6T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
05/20/2009 11,285,462,042,449.61 BHO (UP 658,584,993,536.53 so far since Obama took office.)

Fiscal Year ends: Sep 30
Borrowed in FY1993: (Maybe later.)
Borrowed in FY1994: 281,261,026,873.94
Borrowed in FY1995: 281,232,990,696.07
Borrowed in FY1996: 250,828,038,426.34
Borrowed in FY1997: 188,335,072,261.61
Borrowed in FY1998: 113,046,997,500.28
Borrowed in FY1999: 130,077,892,735.81
Borrowed in FY2000: _17,907,308,253.43 Bill alone
Borrowed in FY2001: 133,285,202,313.20 Bill and George
Borrowed in FY2002: 420,772,553,397.10 All George
Borrowed in FY2003: 554,995,097,146.46
Borrowed in FY2004: 595,821,633,586.70
Borrowed in FY2005: 553,656,965,393.18
Borrowed in FY2006: 574,264,237,491.73
Borrowed in FY2007: 500,679,473,047.25
Borrowed in FY2008: 1,017,071,524,650.01
Borrowed in FY2009: 1,260,737,145,537.20 so far this fiscal year.

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
04/29/2009 -034,727,762,120.64 -
04/30/2009 +079,347,503,951.43 ------------**********
05/01/2009 -003,202,605,992.57 --
05/04/2009 +000,068,750,275.89 ------------******* Mon
05/05/2009 +000,122,936,524.80 ------------********
05/06/2009 -000,058,764,073.21 ----
05/07/2009 +027,679,213,817.18 ------------**********
05/08/2009 -000,216,334,016.92 ---
05/11/2009 -000,029,759,155.68 ---- Mon
05/13/2009 -000,207,515,478.68 ---
05/14/2009 +013,927,016,419.76 ------------**********
05/15/2009 +013,064,365,189.63 ------------**********
05/18/2009 -000,012,816,531.74 ---- Mon
05/19/2009 +000,244,659,127.63 ------------********
05/20/2009 +000,422,183,214.17 ------------********

96,421,071,151.05 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008.
US borrowed $1,620,830,239,190.54 in last 244 days.
That's 1,621B$ in 244 days.
More than any year ever, including last year, and it's 159% of that highest year ever only in 244 days.
And it is over 100% of ANY dismal Bush, for any dismal Bush-year, ONLY IN 244 DAYS NOT 365.

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

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3886969&mesg_id=3887184

[Robbien]

48. Agricultural Commodities: The Next Bull Market

The next bull market will be in Agricultural Commodities.

It’s not difficult to see why. You only make big money by buying investments that have been ignored for years. And few investment classes are as unpopular as agricultural commodities (when was the last time someone you knew opened a sugar plantation or soy bean farm?)

It’s not mere anecdotal evidence either. Inventories for corn, wheat, and soybean are all near 40-year lows. Other soft commodities like cotton, sugar and coffee are at historically low inventories too. So there’s very limited supply.

And it’s only going to go lower.

The credit crisis has made it a lot more difficult for farmers to get access to credit for fertilizer. And low commodity prices have made it no longer economical to grow certain crops (I personally know of a large farm that will not be planting any corn this year for the first time in 60 years).

http://seekingalpha.com/article/138653-agricultural-commodities-the-next-bull-market


Speculators poised on the brink of causing the next series of food riots in developing nations?

[Dr.Phool]

54. Food riots. Just what I was thinking.

Take away everyones jobs, pensions, and healthcare. Foreclose on their houses, jack up their credit card rates, increase their utility rates, and then jack up the price of their food. All for the benefit of the investor class.

VOILA!!!! Long overdue riots.

And maybe a few FRSP's.

[Hugin]

55. Yeah, it fits with my theory...

Watch for gouging in the lower tiers of Maslow's Pyramid.



It's all very Recessive in it's implementation... Just like most of the taxes lately.

Food, Water, Shelter, Energy, Medical Supplies... Y'know, the stuff we peons need to survive.

Meanwhile, the other hand (The Government in the form of The Corporate Congress AKA The Lobbiostocracy) will continue holding down wages and providing no relief what-so-ever because in looking out for their constituents (The Financial Sector) they think they're avoiding a non-existent threat of 'Stagflation' (or maybe that's only a rationalization or justification, I'm not sure.)

[TheMachineWins]

61. This sounds offensive but it's true, the U.S. is a grossly overweight population

We don't need anywhere near the amount of food we consume. Agricultural inflation is a scam, another speculative fund-fueled bubble fed by propaganda of shortages and starving countries. There's plenty of food to feed the entire world, it's corrupt political machines like ours that prevent it.

[Hugin]

56. Fed buys $7.398 billion in Treasurys (MarketWatch)

By Deborah Levine

NEW YORK (Marketwatch) -- The Federal Reserve Bank of New York bought $7.398 billion in Treasurys maturing between 2013 and 2016 on Thursday, the latest in the central bank's program to keep borrowing costs lower and spur economic activity. Dealers offered $45.694 billion to be purchased. The Fed has two more operations scheduled next week. (UST10Y 3.23, +0.04, +1.16%) , which move inversely to prices, stayed down by 2 basis points to 3.18%.

Scary chart... http://www.marketwatch.com/story/fed-buys-7398-billion-in-treasurys-2009521119350

__________________________________________________________________________________________________

And Deborah, (if I may call you that) it's 'Treasuries' and not 'Treasurys'. :eyes:

[Ghost Dog]

60. U.S. The Toll Booth Economy

Michael Hudson writes: It looks like bookstores are about to be swamped this summer and fall by advisories which publishers commissioned a year ago, as the economy was going off the rails. The preferred marketing strategy is to offer advice by celebrity insiders on how to restore the happy 1981-2007 era of debt-leveraged price gains for real estate, stocks and bonds. But the Bubble Economy was so debt-leveraged that it cannot reasonably be restored.

For the time being we are being fed Wall Street defenses of the Bush-Obama (that is, Paulson-Geithner) attempt to re-inflate the bubble by a bailout giveaway that has tripled America’s national debt in the hope of getting bank credit (that is, more debt) growing again. The problem is that debt leveraging is what caused our economic collapse. A third of U.S. real estate is now estimated to be in negative equity, with foreclosure rates still rising.

In the face of this stultifying financial trend, the book-buying public is being fed appetizers pretending that economic recovery simply requires more “incentives” (special tax breaks for the rich) to encourage more “saving,” as if savings automatically finance new capital investment and hiring rather than what really happens: money lent out to create yet more debt owed by the bottom 90 percent to the economy’s top 10 percent.

After blaming Alan Greenspan for playing the role of “useful idiot” by promoting deregulation and blocking prosecution of financial fraud, most writers trot out the approved panaceas: federal regulation of derivatives (or even banning them altogether), a Tobin tax on securities transactions, closure of offshore banking centers and ending their tax-avoidance stratagems. No one presumes to go to the root of the financial problem by removing the general tax deductibility of interest that has subsidized debt leveraging, by taxing “capital” gains at the same rate as wages and profits, or by closing the notorious tax loopholes for the finance, insurance and real estate (FIRE) sectors.

Right-wing publishers recycycle the usual panaceas such as giving more tax incentives to “savers” (another euphemism for more giveaways to high finance) and a re-balanced federal budget to avoid “crowding out” private finance. Wall Street’s dream is to privatize Social Security to create yet a new bubble. Fortunately, such proposals failed during the Republican-controlled Bush administration as a result of a reality check in the form of taxpayer outrage after the dot.com bubble burst in 2000.

There’s no call to finance Social Security and Medicare out of the general budget instead of keeping their funding as a special regressive tax on labor and its employers, available for plunder by Congress to finance tax cuts for the upper wealth brackets. Yet how can America achieve industrial competitiveness in global markets with this pre-saving retirement tax and privatized health insurance, debt-leveraged housing costs and related personal and corporate debt overhead? The rest of the world provides much lower-cost housing, health care and related costs of employee budgets – or simply keeps labor near subsistence levels. This is a major problem with today’s dreams of a renewed Bubble Economy. They leave out the international dimension.

And of course there are the familiar calls to rebuild America’s depleted infrastructure. Alas, Wall Street plans to do this Tony Blair-style, by public-private partnerships that incorporate enormous flows of interest payments into the price structure while providing underwriting and management fees to Wall Street. Falling employment and property prices have squeezed public finances so that new infrastructure investment will take the form of installing privatized tollbooths over the economy’s most critical access points such as roads and other hitherto public transportation, communications and clean water.

There are no calls to restore state and local property taxes to their Progressive Era levels so as to collect the “free lunch” of land rent and use its gains over time as the main fiscal base. This would hold down land prices (and hence, mortgage debt) by preventing rising location values from being capitalized and paid out as interest to the banks. It would have the additional advantage of shifting the fiscal burden off income and sales (a policy that raises the price of labor, goods and services). Instead, most reforms today call for further cutting property taxes to promote more “wealth creation” in the form of higher debt-leveraged property price inflation. The idea is to leave more rental income to be capitalized into yet larger mortgages and paid out as interest to the financial sector. Instead of housing prices falling and income and sales taxes being reduced, rising site values merely will be paid to the banks, not to the local tax authorities. The latter are forced to shift the fiscal burden onto consumers and business.

There are, in this current crop of books, the usual pro forma calls to re-industrialize America, but not to address the financial debt dynamic that has undercut industrial capitalism in this country and abroad. How will these timid “reforms” look in retrospect a decade from now? The Bush-Obama bailout pretends that banks “too-big-to-fail” only face a liquidity problem, not a bad debt problem in the face of the economy’s widening inability to pay. The reason why past bubbles cannot be restored is that they have reached their debt limit, not only domestically, but also the international political limit of global Dollar Hegemony.

What don’t these books address? Everything economics really is all about: the debt overhead; financial fraud and crime in general (one of the economy’s highest-paying sectors); military spending (a key to the U.S. balance-of-payments deficit and hence to the buildup of central bank dollar reserves throughout the world); the proliferation of unearned income and insider political dealing. These are the core phenomena that “free market” choristers have relegated to the “institutionalist” basement of the academic economics curriculum.

For example, the press keeps on parroting the Washington line that Asians “save” too much, causing them to lend their money to America. But the “Asians” saving these dollars are the central banks. Individuals and companies save in yuan and yen, not dollars. It is not these domestic savings that China and Japan have placed in U.S. Treasury securities to the tune of $3 trillion. It is America’s own spending – the trillions of dollars its payments deficit is pumping abroad, in excess of foreign demand for U.S. exports and purchases of U.S. companies, stocks and real estate. This payments deficit is not the result of U.S. consumers maxing out on their credit cards. What is being downplayed is the military spending that has underlain the U.S. balance-of-payments deficit ever since the Korean War. It is a trend that cannot continue much longer, now that foreign countries are starting to push back.

Inasmuch as China’s central bank is now the largest holder of U.S. government and other dollar securities, it has become the main subsidizer of the U.S. payments deficit – and also the domestic U.S. federal budget deficit. Half of the federal budget’s discretionary spending is military in character. This places China in the uncomfortable position of being the largest financier of U.S. military adventurism, including U.S. attempts to encircle China and Russia militarily to block their development as rivals over the past fifty years. That is not what China intended, but it is the effect of global dollar hegemony.

Another trend that cannot continue is “the miracle of compound interest.” It is called a “miracle” because it seems too good to be true, and it is – it cannot really go on for long. Heavily leveraged debts go bad in the end, because they accrue interest charges faster than the economy’s ability to pay. Basing national policy on dreams of paying the interest by borrowing money against steadily inflated asset prices has been a nightmare for homebuyers and consumers, as well as for companies targeted by financial raiders who use debt leverage to strip assets for themselves. This policy is now being applied to public infrastructure into the hands of absentee owners, who will build interest charges into the new service prices they charge, and be allowed to treat these charges as a tax-deductible expense. Banking lobbyists have shaped the tax system in a way that steers new absentee investment into debt rather than equity financing.

The cheerleaders applauding a bubble economy as “wealth creation” (to use one of Alan Greenspan’s favorite phrases) would like us, their audience, to believe that they knew that there was a problem all along, but simply could not restrain the economy’s “irrational exuberance” and “animal spirits.” The idea is to blame the victims – homeowners forced into debt to afford access to housing, pension-fund savers forced to consign their wage set-asides to money managers for the large Wall Street firms, and companies seeking to stave off corporate raiders by taking “poison pills” in the form of debts large enough to block their being taken over. One looks in vain for an honest acknowledgement of how the financial sector turned into a Mafia-style gang more akin to post-Soviet kleptocrat insiders than to Schumpeterian innovators.

/continues... http://www.marketoracle.co.uk/Article10801.html

[snot]

85. this shd be a sep. post.

[Robbien]

63. Appears I wasn't the only one with that thought "Stocks Tank On Fear Of US Downgrade"

Joe Weisenthal

The lesson from today's UK almost-downgrade? There are no sacred currencies in the world.

PIMCO's Bill Gross says he believes the selloff in the US market and currency is due to the surprise out of the UK. Even though the UK borrows in its own money (and could theoretically print its way out of a crunch), debt is, alas, debt. And no entity that's drowning in a mountain of debt as big as its GDP ought to be AAA.

But it may ultimately be a long while before the ratings agencies make such a potentially cataclysmic change in America, in part because the ratings agency monopoly is owed to the kindness of the US government. We're also still in an environment where the dollar is the place where panicked investors park their cash. And though this may end some day, there's no evidence of it happening anytime soon. The bottom line is that there's just no alternative. Not even close.

At the moment, the major indices are all off around 2%, with the dow dropping 157 points. The financials are actually holding up alright, including, (surprisingly), UK banks like Barclays, which is essentially flat.

http://www.businessinsider.com/first-the-uk-is-the-us-next-to-lose-its-aaa-2009-5

[Robbien]

66. Sands opens casino at former Bethlehem Steel mill

BETHLEHEM, Pa. (AP) — A safety officer at the mill for 26 years, Joe Koch felt each twist as Bethlehem Steel, a titan that armed the U.S. military and helped shape skylines across the country, careened into bankruptcy.

Fourteen years after the towering blast furnaces went cold, Koch and other former steelworkers are returning to their sprawling workplace as employees of Las Vegas Sands Corp., which is opening its first East Coast casino there Friday.

While the $743 million Sands Casino Resort Bethlehem pays the historic steel mill homage through its design and architecture, locals and company officials are primarily concerned about the future. Las Vegas Sands, the casino giant led by billionaire Sheldon Adelson, has been counting on Bethlehem to help reverse a slump: The company's first-quarter loss widened to $87.7 million from $11.2 million a year earlier as revenue stagnated at $1.08 billion for the quarter. And city officials are eager to get the long-dormant property back to productive use.

http://www.google.com/hostednews/ap/article/ALeqM5gaxuW21pzSDI93v5Uo68Sqt3wzPAD98APIDO2


Site goes from manufacturing to servicing gamblers.

[Dr.Phool]

69. All Cleveland got at LTV's old west side mill (former J&L)

Was a fucking Wal Mart.

[Demeter]

81. Now That's Just Grossly Perverse

[Robbien]

71. This is weird. ABC's Jimmy Kimmel forgot to take his bullshit pill

This was posted on a blog so am reposting it in its entirety:

If Jimmy Kimmel still has a job at ABC on Wednesday, he is either a very lucky or very deft comedian, or he has great blackmail photos of the network executives.

At Tuesday afternoon’s upfront presentation in New York, Mr. Kimmel, the host of ABC’s late night talk show “Jimmy Kimmel Live,” delivered a withering, blistering monologue that took direct aim at ABC, its potential advertisers and his NBC late-night rival, Jay Leno. The assembled advertisers received his performance with a mixture of uneasy laughs and the occasional gasp.

Bouncing onto the stage at just after 4 p.m., Mr. Kimmel self-deprecatingly declared, “All of ABC’s late night comedy talent is assembled here on one stage.” After rattling off a few statistics about the affluence of his viewers, he then admitted that he’d made all the numbers up. (He said so in a more obscene way.)

Then, in a “Jerry Maguire”-like moment of clarity, Mr. Kimmel said, “Everything you’re going to hear this week is” nonsense. “Let’s get real here. Let’s get Dr. Phil-real here. These new fall shows? We’re going to cancel about 90 percent of them. Maybe more.”

If ABC is so confident in its new fall shows, he asked, why is it announcing them at the same time it announces the midseason shows that will replace those fall shows? “This show ‘Shark Tank’ has the word tank right in the title,” he said.

To the ABC advertisers, Mr. Kimmel said, “Every year we lie to you and every year you come back for more. You don’t need an upfront. You need therapy. We completely lie to you, and then you pass those lies onto your clients.”

Mr. Kimmel then took a verbal swing at his own network, reminding the audience that ABC had attempted to hire away Mr. Leno when his tenure ended at NBC’s “Tonight Show.” But, according Mr. Kimmel, NBC said it would not give up Mr. Leno, “even if we have to destroy our own network to keep him.”

By devoting its entire 10 p.m. lineup, Monday through Friday, to Mr. Leno, Mr. Kimmel said NBC is “giving Jay’s viewers exactly what they want. An early-bird special.”

By deciding on their fall schedule in April, Mr. Kimmel said, “NBC got such a head start, they’ve already had time to cancel half their schedule.”

Mr. Kimmel also aimed a couple of zingers at Fox. That network’s action series “24,” he said, was “a head butt away from cancellation.” Next season, he said, Jack Bauer would have a new sidekick “played by Kiefer Sutherland’s probation officer.”

Returning to ABC’s advertisers, Mr. Kimmel said, “Next year on ‘Grey’s Anatomy,’ your product could kill Dr. Izzie. It just depends on how much you want to pay.”

In closing, Mr. Kimmel said, “I think all our shows are going to work this year. I really do.” He paused. “I don’t, really.”

Before departing the stage, he said: “The important thing to remember is: who cares, it’s not your money.

http://artsbeat.blogs.nytimes.com/2009/05/19/jimmy-kimmel-demolishes-abcs-upfronts/?hp


Who peed in his Cheerios?

[tclambert]

75. Can somebody explain what happened with GM today? GM stock up 32%!

Up 47 cents/share to $1.92, mostly in the last hour of trading. The only news I can try to pin it on is they reached a deal with the UAW. But that was not really a surprise, was it? Certainly not worth 32%.

[Dr.Phool]

77. UAW says it reached a deal with GM

http://www.cleveland.com/business/index.ssf/2009/05/uaw_says_it_has_reached_deal_w.html