Monday, September 29, 2008
A point I would like to make is there seems to be a lot of indecision in the market, but the trend is down friends, so unless you are LTBH types, you better be Jack-Be -Nimble here,,,,there is NO way to get too comfortbale....when ANY news event can scream the mkt one way or another.
If you were short let's say back in early part of year, perhaps you are riding the trend, but not now, even if sure mkt is down, they will do best to chop you up.
IS mkt still thinking no deal? or BIG DEAL? If economy is failing why haven't analysts racheted down sharply SPX earnings?
I wouldn't be so bold to predict final price bottom here, but I have said and will again, EVERY BEAR MARKET ENDS WITH A PERIOD OF PANIC SELLING which exhausts sellers making it less risky to come back in and SIT LONG with stocks even IF world seems still unsettled.
MOST ANALYSTS have very little CASH to buy that bottom, even the ones not bullish.......
Money flows somewhere, so what will do well going forward? MANY are saying DEFENSIVE sectors like healthcare and consumer staples....maybe so, BUT in a BEAR MKT it usually does good job finding where you are hiding.
Gov interevntion here is most dramatic since 1929.
Sunday, September 28, 2008
"This is the first time in the history of United States that anything has been done by Congress to curtail excessive CEO compensation," said House Financial Services Chairman Barney Frank, D-Mass, on Sunday. "It's not everything we'd like, but it's a very good beginning."
But those hoping for an end to golden parachutes - the large pay packages that top executives get when they leave a company - may end up disappointed.
Under the bill, Wall Street executives who already have golden parachutes are likely to keep them even if their companies get government help.
(1) AUTHORITY.—The Secretary is authorized
10 to establish a troubled asset relief program (or
11 ‘‘TARP’’) to purchase, and to make and fund com12
mitments to purchase, troubled assets from any fi13
nancial institution, on such terms and conditions as
14 are determined by the Secretary, and in accordance
15 with this Act and the policies and procedures devel16
oped and published by the Secretary.
*NOTHING CHANGES>>>NOTHING EVER DOES>>> UNTIL WE DEMAND IT>>
Just interviewed on CNN from what he was saying is that the plan to be offerred and voted on IS THE BUSH $700 Billion PRINTATHON giveaway,blank check, bendover taxpayer, false hope bailout pig. That there may appear to be CONCESSIONS, but it is all just "window dressing" and JUST like the fing PAtriot ACT the BUSH ADM is using a PANIC or in this case if you heard the idiots speaches trying to induce a PANIC so their crony bill can get passed.
Some actually woke up and there is NO AMERICAN taxpayer concencus that we do this, it doesn't matter does it?
They have worked all into FEVER PITCH that something get done, only Rick Santelli sniffs a pig, all the others are morons saturating the public with untruths and outright lies...misrepresentation.
I guess I'll have to wait and se Mr MArkets reaction, Houdini or Kreskan I am not, crystal ball I dont have, but in the end it is what it was said to be a fricken BLANK CHECK TO MUNSTER PAULSON AND CAN NOW BE USED TO BAILOUT HIS CRONY WALL STREET FRIENDS AT TAXPAYER EXPENSE.
A PIG is a pig no matter how you dress it up, and when dust settles, watch US $$$, BONDS, MKT REACTION and not just on Monday but as week rolls on and weeks ahead....G-d HELP US!@
WE WENT TO HISTORIC EXTREMES, AND ANY ATTEMPT TO SLOW DOWN PROCESS OF ADJUSTMENTS AND TRIP BACK TO THE NORM WILL ALSO DELAY RECOVERY IMHO
Saturday, September 27, 2008
Here is definition of what you are looking at (investopedia)
The total amount of a currency that is either circulated in the hands of the public or in the commercial bank deposits held in the central bank's reserves. This measure of the money supply typically only includes the most liquid currencies.
from Lou Rockwell :The adjusted monetary base is the only monetary aggregate that the FED controls directly.
sum of reserve accounts of financial institutions at Federal Reserve Banks, currency in circulation (currency held by the public and in the vaults of depository institutions). The major source of the adjusted monetary base is federal reserve credit. The monetary base, as the ultimate source of the nation's money supply, is controllable, at least to some degree, by Federal Reserve monetary policy. The adjusted monetary base data is compiled weekly by the Federal Reserve Board and the Federal Reserve Bank of St. Louis, and is adjusted seasonally.
**The current direction of Bubble-sustaining policymaking goes the wrong direction in almost all aspects. At some point, the markets will recognize this Bubble Predicament, setting the stage for a very problematic crisis of confidence for the dollar and our federal debt markets.
Doug Noland **
The Credit Bubble Bulletin PrudentBear.com
**OK you with me? You understand what it is? Have you looked BACK at the chart from the LINK I provided?
Does that not make you STOP, take notice and drop your JAW? the trajectory, we are talking about a MASSIVE amount of money....more than EVER BEFORE in this short period of time, maybe more than in any given year...in just a short week.
This is no accident, and when you consider that EVERYTHING HAS SEIZED UP, that a HISTORIC amount of liquidity (or attempt thereof) has not been able to BUDGE the damn thing, that we still TEETER on the edge of a financial abys.....DOES THE SEVERITY and SERIOUSNESS OF IT ALL COME THRU TO YOU?
The U.S Mint said Thursday it was temporarily suspending sales of American Buffalo 24-karat gold one-ounce bullion coins because strong demand depleted its inventory.
All in, the funds have lost around $1 billion this year, a figure that includes $270 million of personal losses. "It's my toughest run in 10 years," said Mr. Pickens, a former geologist who earned billions by building an oil company and investing in energy. "We missed the turn in the market, there's nothing fun about it."
WEBSITE FOR ARTICLES http://new.goldmau.com/index.php
SOUND FAMILIAR : First, look at the bank crisis in the making. Despite a government fix-up job in 1998 and 1999, Japan's banks are still larded with old nonperforming loans just as the economy slows down again, only two years after a recession.
http://www.businessweek.com/2001/01_05/b3717163.htm YEAR 2001 !!
Perversely, the banks are creating the conditions for a market panic. One by one, they're unloading shares from the stock portfolios they have hoarded for years. Why? They need money,
As I am not sure there is anything that can be done.....it's just to big.
list of 2008 bANK fAILURES! http://www.fdic.gov/bank/historical/bank/index.html listed by month
indy mac bank
Wash Mutual (largest Bank failure EVER!)
Hedge Funds liquidating http://www.hedgeco.net/news/category/closing-hedge-funds/
Money market troubleshttp://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/09/23/financial/f123622D71.DTL
HOME FORECLOSURES http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/09/25/BUBL134FO3.DTL and how Indy MAc mortgage holders were treated
$700B Bailout effort (largest in history)
Credit Card debt surging
Home Values declining
Banks not lending
Wall Street forever changed
SO...how's your day going?
ONE OF THE LAST DECENT VOICES OF REASON LEFT, ON CNBC ANYWAY
Trying to add a bit of simplicity to the Complexity of a Credit Market Breakdown, I’ll say the Lehman collapse marked a critical inflection point in at least five major respects: First, the Crisis of Confidence jumped the “firebreak” from risk assets to contemporary “money,” shattering trust in various facets of contemporary finance that was forged over decades. Second, it required the marketplace to reexamine exposures to various direct and indirect counterparty risks, a terminal blow for derivatives markets. Third, it pushed the Credit default swap marketplace into full-fledged dislocation and instigated a long-overdue regulator onslaught. Fourth, it decisively burst the “leveraged speculating community”/hedge fund Bubble. This has ushered in another round of problematic de-leveraging and accelerated the reversal of “Ponzi Finance” dynamics. Fifth, it instilled global fear with respect to the risks of participating in the inter-bank lending market with American institutions.
Basically, the Lehman collapse marked the end of “Wall Street” risk intermediation as a significant component of system financial intermediation
**I don't think the BEAR HAS MADE ITS FINAL LOWS, but there is a good chance unless pending BAILOUT gets repudiated, a ST low is here or near, just a hunch. The landscape has changed and I think SPX earnings continue their decline.
Friday, September 26, 2008
DID anyone see CNBC few minutes ago....there is obviously one person telling the truth...never seen anything like it... RICK S !!!!! jack knows JACK there's clam LIESMAN in face of storm...
NO DEAL over weekend....no deal MONday? wil lead to an all out CRASH of financial system....you saw that ADJU M base Mf'er!!!! NEVER SEEN anything like that and friends...so far NONE of the actions have stemmed the tide.....this is not too big to fail it's too BIG to stop!
Picture worth 1,000 words? take a LOOK HERE !!!!!! http://research.stlouisfed.org/publications/usfd/page3.pdf OMG!!!!!!!!!!!!!!!!!!!!!!!!!
While these feckless ass brained politicians bicker and argue over a DEAL it would be helpful if one of them knew what they were talking about.....and the PRESSURE TO SELL TO GET OUT IS GROWING LIKE THE WOLFMAN BANGING ON THE DOOR YOU HELD BACK WITH CHAIR AGAINST DOOR KNOB........ if that chair falls......
Will one person of importance (neither candidate) step forward, make sense of this and acknowledge those responsable and OUST THEM from OFFICE....BERNANKE, PAULSON ETC....
Dont look for answers from those who created them
"During another turbulent week on Wall Street, lending through the Federal Reserve Board's discount window skyrocketed to $262.3 billion on Wednesday, thanks to new lending programs unveiled during the week.
It was the second record in as many weeks and more than double from the previous high water mark.
The heaviest lending was centered on the primary dealer credit facility, which was established in March to give investment banks access to the discount window. The Fed eased terms on the facility on Sunday when it approved requests from Goldman Sachs and Morgan Stanley to convert to bank holding companies.
The Fed said Goldman and Morgan, the last of the major investment banks, could borrow on the same terms as commercial banks and with the same collateral. In response, lending through the PDCF totalled $105.662 billion on Wednesday, from $59.8 billion a week earlier."
Federal regulators shut down $307 billion-asset Washington Mutual Bank,
the largest failure in American history, late Thursday, selling its assets and deposits to JPMorgan Chase & Co.
While dramatic, the collapse had a unique twist. All uninsured deposits were covered, likely stemming depositor panic as a result of the closure, and the failure is not estimated to cost the Deposit Insurance Fund any money.
JPMorgan paid a $1.9 billion premium and took all of Wamu's deposits, assets and qualified financial contracts. Shareholders, subordinated and senior debt holder claims were wiped out!
By John Parry and Jamie McGeeever, Reuters
NEW YORK/LONDON — Banks and money managers borrowed a record amount from the Federal Reserve in the latest week, nearly $188 billion a day on average, showing the central bank went to extremes to keep the banking system afloat amid the biggest financial crisis since the Great Depression.
Letting the banks FAIL and assets bought out where stakeholders get WIPED OUT is better than a bailout..PAINFUL..but better IMHO
I am again looking for 1st extreme move.....be careful out there and good luck.
Thursday, September 25, 2008
The lovely Mrs. Reason turned to me last night while watching our lame duck president “explain” the current economic situation and what we must do to avert the ruin that’s already upon us, and said, “There hasn’t been this much bi-partisan consensus since NAFTA. We’re really in for it.” Amen, my dear.
Texas Congressman Ron Paul, he who was widely decried as a kook when he explained our disastrous monetary policy while running for president, put the same thought this way: “Whenever a Great Bipartisan Consensus is announced, and a compliant media assures everyone that the wondrous actions of our wise leaders are being taken for our own good, you can know with absolute certainty that disaster is about to strike.” (more Paul here)
This bailout soon to be ratified with minor, cosmetic changes administered by the cosmeticians in Congress – that’s right, like putting lipstick on a pig – is worse than socialism; it is, as Jeffrey Snyder explains so well here, far more shocking than socialism. “It’s a continuation,” Snyder says, “of what we already have – creating profit-making opportunities for the wealthy off the backs of taxpayers.”
“With hundreds of billions at its disposal,” Snyder explains, “the Fed has the ability to preserve and create new titans of finance. The bailout process will not be unlike Russia’s creation of overnight billionaires through the public sale of rights to its natural resources for ludicrously low sums of money, all accomplished at the expense of the taxpayer. I believe we here in the U.S. call this ‘crony capitalism’ when practiced in Russia. The taxpayers will bear the losses; receive nothing for it, while new profit opportunities are created for the ruling class. Nothing prevents this. Congress will receive reports.”
The reason for the harrumphing by senators and congresspersons is that they are hearing nasty things from the voters who put them in office. The people don’t want this gargantuan fraud to be enacted. But in the end that doesn’t matter at all, and the rulers will get what they want.
And don’t think your representatives weren’t busy with other items of importance yesterday. In a quick, quite secret process, the House passed a $630 billion-plus spending bill, mostly for our mighty war machine, but wrapped in other pork parts as well. $488 billion goes to the Pentagon, $40 billion to the totally inept Homeland Security Department, plus $73 billion for veterans programs and military base construction projects – it’s very expensive to maintain more than 700 bases around the world – and as the sweetener for members $6.6 billion is allocated for 2,322 home-state pet projects.
According to the Associated Press, the debate on this lasted less than an hour. That pretty much says it all, doesn’t it?
WBAL Radio - Baltimorehttp://wbal.com/
After referring to the common experience of mankind with government, Lao-tzu came to this incisive conclusion: "The more artificial taboos and restrictions there are in the world, the more the people are impoverished…. The more that laws and regulations are given prominence, the more thieves and robbers there will be."
We got sold out again today, my FLAG is at half mast! My bass teacher was curious as to why we seemed to know more and what was right than our legislators...
A word to the wise: you can’t really make people wealthy by resorting to "Zimbabwe economics." A society grows rich by producing things...and saving money. There is no other way. Cheaper credit won’t do it. More consumption won’t help. Printing money – and dumping it from helicopters – is a losing proposition. Jan/08
We also have news of a GE earnings miss, suspension of stock buyback and being placed on the DO NOT DISTURB no short list...a DUBIOUS distinction for what is seen as one of America's strongest companies.
Whereas the BAILOUT plan is like a snowball rolling downhill into a fire, problems go FAR BEYOND those being talked about.....around corner comes credit cards and car loans.
One plan (not going to see light of day) would have stock and bond holders take the dive BEFORE A DIME OF TAX PAYER dollar's gets involved, severing the GOOD BANK from the BAD ONE.
Markets have paused as they await final answer.
Wednesday, September 24, 2008
WASHINGTON (MarketWatch) -- Pushing on to shore up the markets, the list of banned short-sale stocks has been expanded to include the likes of General Electric Co., General Motors Corp. and American Express Co.
for example, we were concerned about the possible unnecessary or artificial price movements based on unfounded rumors regarding the stability of financial institutions and other issuers exacerbated by "naked" short selling.
page 4 appendix is orig list of stocks protected! http://sec.gov/rules/other/2008/34-58592.pdf
ADDITIONAL STOCKS ADDED TO PROTECTIVE LIST
http://media.philly.com/documents/SEC+Short-Selling+Adds.pdf GE AMONG THEM!!!!
here comes witch hunt plus FBI
FOR IMMEDIATE RELEASE2008-214
Washington, D.C., Sept. 19, 2008 — The Securities and Exchange Commission today announced a sweeping expansion of its ongoing investigation into possible market manipulation in the securities of certain financial institutions. The expanded investigation will include obtaining statements under oath from market participants.
Hedge fund managers, broker-dealers, and institutional investors with significant trading activity in financial issuers or positions in credit default swaps will be required, under oath, to disclose those positions to the Commission and provide certain other information.
THE go nowhere mkt until some kind of deal struck.....in front good be nice ride or steam roller....."it is not always about how much you can make, but PROTECT what you have"
Pickens funds down about $1 billion this year:
Wednesday September 24, 7:14 am ET
(Reuters) - Texas oil magnate T. Boone Pickens' hedge funds have lost around $1 billion this year, including $270 million of personal losses, The Wall Street Journal said.
One fund focused on energy stocks was down almost 30 percent through August, the paper said adding that a smaller commodity-focused fund is down 84 percent.
"It's my toughest run in 10 years," the paper quoted Pickens as saying.
Pickens could not be immediately reached for comment by Reuters.
(Reporting by Ajay Kamalakaran in Bangalore; editing by John Stonestreet)
Tuesday, September 23, 2008
I heard some testimony and response, they arent even CLOSE to deal.
FLIMSY 3 page Paulson deal?
Lobbyists trying to rewrite bill
HOW can stock market not CRASH......when wall street itself is crashing? IT WILL NEVER BE THE SAME....
Hard to be SPECULATOR.....whipping, choppity emothional unpredictable mess
They are ON to Paulson....ex MS shill.....longer it takes...more pressure just to do something....pass half ass bill
EMperor not only has no clothes....has fat ass
CREDIT MARKETS NOT FUNCTIONING BIZ grinding to halt
GE MEGA CO LOWERS EARNINGS stock falls
We are so screwed, we cannot pay for this.....how in nay scenario does US $$ survive it will become near worthless..as US DEBTS MOUNT
Paulson wants to bail out Foreign banks? He is INSULT to bald men everywhere...
http://www.321gold.com/editorials/willie/willie121406.html 2006 PAULSON TRIP TO OWNERS OF THE USA CHINA
Hanky Panky at the Counting HousePosted in the database on Wednesday, June 07th, 2006 @ 18:59:24 MST (413 views)
by Lila Rajiva Dissident Voice
What’s the deal with Bush’s new honcho at the Treasury? Replacing John Snow as Secretary (effective Tuesday, May 30) is Henry (Hank) Paulson, who is CEO of Goldman Sachs. Among Wall Street’s capos, that makes Paulson capo di tutti capital markets and the speculator-in-chief of our speculation driven economy, the main manipulator in a manipulated market.
It means that the chicken coop is directly in the paws not just of any egg-sucking fox but a Bengal tiger in its prime. Really, why not invite the Cali drug cartel to run the DEA while we’re at it?
Servicing the Public
The story goes that Paulson was reluctant to leave his lucrative post for government service. After all, at Goldman he makes about $38.8 million a year (with $154,000 tossed in for a car and driver, just in case he can’t afford them on his own). And he has a 4.58 million-share stake in the company worth nearly $700 million. Why would he want the piddling 171,900 bucks that the Treas. Sec. makes except for the satisfaction of public service? Why indeed. (1)
LIARS SAY $1T how about $5T?? Tuesday, September 23, 2008
$5 Trillion Needed to Stop Bank Crisis, Says Japanese Expert
Ken Ohmae, former head of McKinsey's Tokyo office (disclosure: I have a passing acquaintence with him and he was enormously well regarded in his day despite being a tireless self-promoter) says that the Paulson program is grossly inadequate and the magnitude of the US crisis is so large that a $5 trillion international facility is necessary.The quid pro quo of any international program is that the US would be put on a short leash, probably not as severe as the one to which Indonesia and Thailand were subject to in the Asian crisis. But the US is not good at austerity and has never been in the position of not being in the driver's seat, so this sort of initiative would no doubt be rejected until it is too late for it to have much impact.
from ANGRY BEAR BLOG
Your Urgent Help Needed
I need to ask you to support an urgent secret business relationship with atransfer of funds of great magnitude.I am Ministry of the Treasury of the Republic of America. My country has had crisis that has caused the need for large transfer of funds of 800 billion dollars US. If you would assist me in this transfer, it would be most profitable to you.I am working with Mr. Phil Gram, lobbyist for UBS, who will be my replacement as Ministry of the Treasury in January. As a Senator, you may know him as the leader of the American banking deregulation movement in the1990s. This transact in is 100% safe.This is a matter of great urgency. We need a blank check. We need the funds as quickly as possible. We cannot directly transfer these funds in the namesof our close friends because we are constantly under surveillance. My family lawyer advised me that I should look for a reliable and trustworthy person who will act as a next of kin so the funds can be transferred.Please reply with all of your bank account, IRA and college fund account numbers and those of your children and grandchildren firstname.lastname@example.org so that we may transfer your commission for this transaction. After I receive that information, I will respond with detailed information about safeguards that will be used to protect the funds.
Yours Faithfully Minister of Treasury Paulson
http://www.safehaven.com/showarticle.cfm?id=11344&pv=1 Robert Prechter weighs in
FOLKS, we are near financial ruin and collapse and we need to do this right
http://www.hussmanfunds.com/wmc/wmc080922.htm Alternative to SHILL PAULSON'S PLAN
Monday, September 22, 2008
We break 1200 SPX down she goes…..what miracle here I do not know or see…….and instead of a SAVE we get ALL IN CRASH of which I have warned.
FIRST....we hit my target for SSO at $54 but because of weakness in the UYG I am on guard for reaction here, tomorrow, a break of 1200 COULD SEND market into HUGE tailspin to test already reaction LOWS....OR this is the move I suggested could take place to fill SSO gaP!?? (2X long SPX)
Emotion stil running high over uncertainty of this plan, there is NO way to know if this is what is needed to fix this mess.
What I FEAR is JAPANESE style DEFLATION (OIL GOLD reacting to US $$ drubbing and safe haven from PAPER!!) if assets rotten do NOT GET MARKED DOWN OR DEFAULT......
Here it is: I can only borrow snippets, go here for complete story
WASHINGTON - Scrambling for a quick accord on the $700 billion bailout, the Bush administration and leading lawmakers have agreed to include mortgage aid and strong congressional oversight along with unprecedented help for failing financial institutions, a key lawmaker said Monday.
*Duratek comment.....we ALL Know how well things run when the GOV gets involved.
THE HEAD MUPPET CHIMES IN:
Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, said "a great deal of progress has already been made." And a government official with knowledge of the talks said the administration had agreed to create a plan to help prevent foreclosures on mortgages it acquires as part of the bailout — a key demand of Democratic lawmakers.
Under other additions the Democrats are asking to the administration package, according to a draft of the plan obtained by The Associated Press:
• Judges could rewrite mortgages to lower bankrupt homeowners' monthly payments.
Duratek Comment: IN 80's when japan real estate caused DEFLATION, the GOV PROPPED UP the banking system not allowing it to DEFAULT on the loans and the mess slogged on for 20 some years@!!! mkt was 40,000 IN 1980 NOT ITS 12,000 IN 2008 !!!! at least they had savings!
JUDGES "could rewrite mortgages"??? OMG!!!!!!!!!!!!!
• Companies that unloaded their bad assets on the government in the massive rescue would have to limit their executives' pay packages and agree to revoke any bonuses awarded based on bogus claims.
The proposal by Sen. Chris Dodd, D-Conn., the Banking Committee chairman, would give the government broad power to buy up virtually any kind of bad asset — including credit card debt or car loans — from any financial institution in the U.S. or abroad in order to stabilize markets.
Duratek Comment: WHAT PAY!!!!! NO PAY idiots how about firing them? but don't worry we have "judges" and "oversight"
GOV OWNS FANNIE 95% of all MORTGAGES now provided by GOV (socialism???) Fed Home Loan ETC ETC
GOV BUYING (OWNING) our creidt card debt? was that in ORIG $700B "GUESTIMATE???"
" from any US or company ABROAD??????" again (sorry for language !) are you F^%%&!! kidding me? Surely ex Wall Street Insider Paulson promises Overseas BANKS AND GOVERNMENTS WILL MATCH OUR ACTIONS........why should they if we will do it all LIKE POLICE WORLD?
GOV gets SHARES in companies they rescue? VIVA LA COMISAR???
ACtion expected by WED, so gosh the market could and will do ANYTHING...it is a BEAR and will rip newbies and oldies alike.
THE HOMES PEOPLE BOUGHT THEY COULDN'T AFFORD?????
The proposal that Dodd sent to Treasury Secretary Henry Paulson would let judges modify the mortgages of homeowners in bankruptcy to allow them to keep their homes.
It also would require that the government come up with "a systematic approach for preventing foreclosure" on the mortgages it acquires as part of the bailout. That would include the home loans held by Fannie Mae and Freddie Mac, the troubled mortgage giants now under the control of a government regulator.
FED TO THE WOLVES!!!! and are rewarded with OWNING THE COUNTRY?
The fast-moving negotiations between the administration and Congress unfolded a day after the government approved a request by investment houses Goldman Sachs and Morgan Stanley to change their status to bank holding companies.
That change will allow the two venerable institutions to set up commercial banks that will be able to take deposits, significantly bolstering the resources of both institutions. It will also grant them permanent access to emergency loans supplied by the Fed rather than the temporary loan status they have had since last March when the Fed moved to prop up investment banks following the forced sale of Bear Stearns.
I am F'ing speachless on that one....are you reading this those who lurk in the shadows....other than a few who leave comments...I hope I am reaching a MUCH larger audience....
CALL EMAIL YOUR CONGRESS PEOPLE
Tell them you dont want to GET SOLD OUT!!!!
COAL MAY GO THRU THE ROOF
Everything is a trap.....markets moving so fast, IMHO the place to be until the dust settles (??)
is somewhere SAFE, consult your financial advisor if you are worried.
SURE the MARKET ALWAYS GOES UP................except when it goes down
http://www.thelongwaveanalyst.ca/flash_cycle.html LASTLY THE BEST site I have been to explaining these long cycles an EYE OPENER!!! ABOVE LINK explains the KONDRATIEFF CYCLE.
GS and MS want to CHANGE to HOLDING CO's !! The financial devestation caused by extreme greed and copycat hedge funds is now laid to waste
Here are some of the changes
Less RETURN, LESS RISK, LESS PROFITS, LESS LEVEREDGE, STRICTER OVERSITE and MORE REGULATION....all leads to slimmer, less gregarious system
HEDGE FUNDS WILL NEVER BE THE SAME.
SOME FUND MANAGERS SHOR POSITIONS WILL NOW BE MADE PUBLIC 2 WEEKS AFTER FILING!
The delevardging may lead to inflation ($1T to pay for it) and or STAGFLATION.....which of these ultimately are good for the stock market?
Does this mean LESS money for VENTURE CAPITAL FIRMS......the BREEDING GROUND FOR NEW COMPANIES FUNDING AND US INNOVATION!!!!!!!!!!!!!!!!! ALL IMHO
I am wondering of course what to do? There are many BEATEN down stocks, some good ones.....time to MAKE LIST IF you have moved to cash to take advantage, why ALL IN usually not good strategy
I was looking for SSO to fill gap near $54.
RAVENS GO 2-0 and almost noone talking about them on national sports shows......
GL this week, going forward as many wrestle with new landscape, as the unwinding continues....it could get wild. I am rethinking my 4-6 months of rally scenario..it all depends on follow up and increaseing investor demand of which some of the usual buyers have been taken OUT! ASIA RALLIES OVERNIGHT especially beaten down left for dead SSEC.
Sunday, September 21, 2008
“The market for derivatives grew at the fastest pace in at least nine years to $516 trillion in the first half of 2007, the Bank for International Settlements said. Credit-default swaps, contracts designed to protect investors against default and used to speculate on credit quality, led the increase, expanding 49% to cover a notional $43 trillion of debt in the six months ended June 30, the BIS said… ‘The pace of increase in the credit segment outstripped the rises in other risk categories,’ Christian Upper, a BIS analyst…wrote…The money at risk through credit-default swaps increased 145% from last year to $721 billion…”
Bloomberg, November 22, 2007
**SOMEBODY OUT THERE ISNT BEING HOSED FROM THIS MELTDOWN>??????????????????????????
Saturday, September 20, 2008
That is certainly possible, these downers interupted bby throw in the kitchen sink bailout backstop attempt.
My studies tell me good chance of multi month rally coming (not STRAIGHT UP of course) and it is possible given Pres cycle this bounce could last until next MArch (remember 2000 top here?)
WE have Transports CLOSE to all time high not confirming recent DOW LOWS.
WE HAVE SHORT RULE
Will they extend thru OCT? that decision could be important
NO certainty to anything but I think at least 2 more downer stabs of LARGE MAGNATUDE AWAIT US into 2009 which SHOULD lead to BEAR BOTTOM.
I am considering several actions, but know this, rallies of LONG DURATION exist in Bear market some even 4-6 months long
Just using MA'S study and divergences say ultimate bottom may be somewhere in the distance.
None of this may help you, in what to do, but I hope we get MORE clarity in future months as to just WHERE WE ARE IN THE CYCLE OF THE BEAR
MY BEAR reading of 31.93 was within .06 from 2001 MARCH low reading of 31.87 at first I figured this was same as 911 selling climax....but it wsn't !!!
OMG what else other than what we know could be lurking???? OR AM I STONE COLD DEAD WRONG AND WE SHOULD PUT OUR PARTY HATS ON?
WHAT came after 911 which caused us to draft past old lows? WHAT happened in 1930 which caused a TREMEDOUS DECLINE BLOWING PAST THE CRASH LEVEL of 1929?
WHAT WOULD SHOW WORLD efforts have failed and deflation wins over INFLATION ATTEMPTS?
FED and WORLD GOV'S are buying up ASSETS like never before, a KITCHEN SINK ALL IN EFFORT that doesn't hold us at least at these levels....well could lead to the ALL OUT PANIC where "get me out at any level" bear bottoms are made of....this last low was TOO SELECTIVE in its selling.....IMHO
Friday, September 19, 2008
http://money.cnn.com/2008/09/19/markets/thebuzz/index.htm?postversion=2008091918 banning shorts big mistake
http://money.cnn.com/2008/09/19/news/companies/ameribank_closure/index.htm 12th bank failure
DETROIT (AP) -- General Motors Corp. said Friday it intends to draw down $3.5 billion of a $4.5 billion secured revolving credit facility for its restructuring in what it called "uncertain times in the capital markets."
General Motors (GM, Fortune 500) will be using the remainder of the credit facility. The company said it was making the move to have more liquidity while capital markets are under pressure.
WE GOT THEM TOO!!!
Money-market funds are typically a safe investment popular with American consumers and companies alike, but redemptions have severely strained fund families and global financial markets.
In response, the Treasury said it would insure up to $50 billion in money-market fund investments at financial companies that pay a fee to participate in the program. The initiative, which lasts for a year, will guarantee that the funds' value does not fall below the standard $1 a share.
"Concerns about the net asset value of money-market funds falling below $1 have exacerbated global financial market turmoil and caused severe liquidity strains in world markets," the Treasury Department said in a statement
http://www.safehaven.com/article-11292.htm PAULSON ALL IN!!
When the U.S. government owns all mortgages, the real estate market will be completely subject to political, rather than financial, concerns. Will foreclosures be outlawed? Will loan term easements and principal reductions become standard campaign issues?
While it is dizzying to predict how this plan will be implemented, it is fairly simple to foresee the macroeconomic consequences. The U.S. dollar will be shattered beyond repair. The government simply has no means to make good on the trillions of new liabilities. Interestingly, while both Paulson and President Bush acknowledge that the plan will put "significant amounts of taxpayer dollars on the line," they did not mention any tax increases. Given the politics, no such move is forthcoming. The printing press is their only solution.
GREEN BAY, Wis. - Republican John McCain said Friday the Federal Reserve needs to stop bailing out failed financial institutions. The Republican presidential hopeful said the Fed should get back to "its core business of responsibly managing our money supply and inflation" and he laid out several recommendations for stabilizing markets in the financial crisis that has rocked Wall Street and commanded the dialogue in the presidential campaign.
McCain made little mention of the massive proposal being crafted by Treasury Secretary Henry Paulson that could amount to a $1 trillion taxpayer bailout of the mortgage industry. McCain said simply that leaders should put aside partisan differences and "any action should be designed to keep people in their homes and safeguard the life savings of all Americans."
That m’fer insider wall street shill blood sucking parasite idiot!!!!! IS GOING TO GET AWAY WITH IT, AVG CONGRESS PERSON NOT TOO BRIGHT AND NEVER READ THE LEGISLATION!!!
Thursday, September 18, 2008
US FINANCIAL FIX?
"government plan to rescue banks from toxic mortgage debt brought hope of a letup in the world's worst financial crisis in decades."
"Investors also took heart from word that the U.S. government was seeking the power to rescue banks by buying distressed assets"
EXACTLY like the spike week after 911 however and that led to 6-9 month rally..we have PRES cycle and that led to NEW lows
WE have PRES cycle
We have hOPE
WE have likely DEM victory and there go your taxes.....
WE have new lows in mid to late 2009
DEVIL in DETAILS HERE? HOW THEY PULL LIT OFF...let me say this......CREDIT EXPNSION IS WHAT WE MUST HAVE, IF WE GET THAT MAYBE WE CAN HEAL.....NO JAPANESE SCENARIO?
WILL THIS PLAN WORK? REMEMBER $180B CB FLOOD.....well it gotta go somewhere huh? WHY not right into the stock mkt
You think the world is crazy...gold bugs were FREAKING OUT, "betting the farm" estatic euphoric etc about largest increase in one day ever, now? largest drop since 1980!!!! ARE YOUR FEET ON SOLID GROUND? QUICKSAND? good lesson here about being net SHORT too...this is what can always happen especially when VIX GETS HIGH!
FREE MARKETS WERE SET BACK YEARS>>> U.K. and U.S. regulators cracked down on short sellers
GOV GETS MORE POWERS (ONLY emblodening embezzlers more in future they will bailed out by who? TAXPAYERS GET KILLED!!!!!)
"Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke are crafting a plan, which they plan to soon deliver to lawmakers, after concluding they need broader powers to combat fallout from a housing and credit market meltdown that has sent shock waves through Wall Street and around the globe. Congressional leaders said they expected to get the plan Friday and act on it before Congress recesses for the election."
'As financial companies racked up multibillion-dollar losses on soured mortgage investments, and credit problems spread globally, firms hoarded cash and clamped down on lending. That crimped consumer and business spending, dragging down the national economy — a vicious cycle policymakers have been trying to break.
"The root cause of the stress in the capital markets is the real estate correction," Paulson said, adding he hopes to have a solution "aimed right at the heart of this problem."
Bernanke said a resolution would help "get our economy moving again."
Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, discounted the idea of setting up a new agency — similar to the Resolution Trust Corp. — established in 1989 to help resolve a savings and loan crisis at a cost to taxpayers of $125 billion.
"It will be the power — it may not be a new entity. It will be the power to buy up illiquid assets," Frank said. "There is this concern that if you had to wait to set up an entity, it could take too long."
The federal government already has pledged more than $600 billion in the past year to bail out, or help bail out, some of the biggest names in American finance. There was no immediate word on how much the new rescue plan might cost.
BIGGER GOV, MORE REGULATION WALL STREET NEVER THE SAME?
MORE HANDOUTS TOO!!!
WASHINGTON - House Speaker Nancy Pelosi vowed Thursday to press ahead with a Democratic plan to inject more than $50 billion or so into the economy, despite opposition from the White House and moderates in her own party.
**WHEN THE DUST SETTLES IMHO we have been weakened from the inside out, the FED now saddled with billions of toxic paper, the GOV now saddled with BIllions of bailouts......how does this trillion $$ bastard get put to sleep.........?
Best of luck, keep in mind that perhaps when day is done 1,000 DOW points are IN already in this move, it's how it works, now what going into next week, bears slaughtered......tha's what I am going to dig into this weekend and see if I can find an answer.
WHAT is NORMAL, like in 2002 lows, it comes back and gets tested.....kinda like 2nd mouse move, that is still possible and is what I may be waiting for. take care
Could be one day wonder? OPEX FRI coming could be wild....VIX 41 was KEY today, too high it will come back I am thinking to 20 area to reload.
List of Banks etc exposed to FANNIE MAE
THIS REPORT SPARKED THE MARKET
The report that Treasury Secretary Henry Paulson is considering the formation of a vehicle like the Resolution Trust Corp. that was set up during the savings and loan crisis of the late 1980s and early 1990s left previously solemn investors ebullient. Wall Street hoped a huge federal intervention could help financial institutions jettison bad mortgage debt and stop the drain on capital that has already taken down companies including Bear Stearns Cos. and Lehman Brothers Holdings Inc.
"It's going to take a lot of the bad debt off the balance sheets of these companies," said Scott Fullman, director of derivatives investment strategy for WJB Capital Group in New York, commenting on the possibilities of an entity akin to the RTC. It could alleviate many of the pressures causing the credit crisis, he said, and reopen moribund credit markets. But Fullman noted, "the devil's in the details."
"Bear markets are very sensitive to news. And on a scale of 1 to 10, this one is a 13," he said of the report.
WE RALLIED ON HOPE? WE SUSTAIN WITH NCREASED BUYING ENTHUSIASM, so lets see how she goes.
Ron Smith wbal.com
I must admit to being a bit overwhelmed in trying to sort through the rubble from the implosion of the nation’s banking system. Talk about a big topic. Whew! This is BIG! Very few living people, it’s safe to say, have witnessed anything comparable to the events of recent days, unless that is, they are Japanese (more on that in a moment).
One analyst said, ‘Wall Street as we’ve known it is dead.” It has ceased to exist. It’s like the parrot in the Monty Python sketch. It is not resting. It is dead. Who or what killed the thing? Who’s to blame? Greedy Wall Streeters? Yup. Negligent and corrupt politicians? You bet. Do-gooder socialists? Them, too. Republicans? Uh-huh. Democrats? Oh, yeah. The Fed? Yesss!
There’s plenty of blame to go around and there are lots of people who tended responsibly to their own fiscal affairs who are now going to be saddled with paying for the excesses of the hustlers and the politicians they bought. The prudent must be taxed – indirectly through further cheapening of their money (inflation) – in order to bailout major financial institutions run by the geniuses who paid themselves billions in bonuses for structuring a system grounded in quicksand, who came to believe in the classic hustler way in the thing they were hustling.
This is yet another reminder – as though you needed it – that life isn’t fair. The ruthless and ambitious claw their way to the top of the heap and when it starts to fall apart, they leap to safety; their fall cushioned by “golden parachutes” and lush retirement packages. They retreat to their estates in the Hamptons while the people who depended on their companies for their livelihoods are left behind.
The Lehman Brothers secretaries from Queens and the A.I.G. clerks from Brooklyn and all the others employed by the Masters of the Universe are greatly screwed. They start networking after hauling their personal property out of their offices while police with dogs stand by to make sure none of the disgruntled workforce members causes any difficulties. But the networking is a slender reed, since the entire industry is melting away like river ice as spring approaches. Jobs will be scarce.
The most useful parallel is what happened to Japan nearly two decades ago when the Nikki Dow went south because of ridiculous real estate valuations that threatened the big banks in the Land of the Rising Sun. They were too big to fail, like our own big banks today, and so they were propped up leading to economic stagnation that has lasted all the years since.
The Japanese, however, were far better equipped to endure this kind of thing than are we. A nation of savers can continue to thrive even in a major slowdown. Ours is a nation of borrowers, ill prepared for hard times. Hunkering down is a skill many will have to learn.
Tuesday, September 16, 2008
Baltic Dry Index - BDI
A shipping and trade index created by the London-based Baltic Exchange that measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. The Baltic Exchange directly contacts shipping brokers to assess price levels for a given route, product to transport and time to delivery (speed).
The Baltic Dry Index is a composite of three sub-indexes that measure different sizes of dry bulk carriers (merchant ships) - Capesize, Supramax and Panamax. Multiple geographic routes are evaluated for each index to give depth to the index's composite measurement.It is also known as the "Dry Bulk Index".
Changes in the Baltic Dry Index can give investors insight into global supply and demand trends.
This change is often considered a leading indicator of future economic growth (if the index is rising) or contraction (index is falling) because the goods shipped are raw, pre-production material, which is typically an area with very low levels of speculation. Because the supply of large carriers tends to remain very tight, with long lead times and high production costs, the index can experience high levels of volatility if global demand increases or drops off suddenly.
The Baltic Exchange also operates as a maker of markets in freight derivatives, a type of forward contract known as FFAs (forward freight agreements) that are traded over-the-counter.
WHAT THE F are we left with to buy a house? SCREAMING EAGLE EYES disecting every credit app like looking for one seasme seed on the beach....or a federal home loan....what happened to those Country wide commercials? or requiring 20% DOWN? who got that....are people who do got that WAITING for lower prices?
Macy's BUSY with 40% discounts....Nordstrom's $175 shirts look too neat on their tables like no one has touched them.
DO American's have savings to fall back on like the japanese did in the 90's?
With unemployment rate going up and HIGH paying jobs lost....does that support home prices? What if home prices keep falling? are they going to rise anytime soon? SO is debt marked down all the way yet?
If we get a VIX 40 strike.......or a 1K DOW as we roll into OCT it might be safe to come out of the bunker......ON Street signs the traders there said that the BEST were getting beat up good......
A true rally will carry some force behind it ......name even one.....if NO anwser for 90% downers, even multiple ones....is an all out collapse down the road? was the 500 pt loss it? or appetizer....previous 30 VIX spikes provided long platform....will it take more now?
GE tumbles as investors fret over financial stocksAP(Mon 6:44pm) GE now seen as FINANCIAL STOCK? off another $2 getting closer to 420 WHO wouldnt buy GE at $20 (long term??/)
Lemmings getting VERY nervous.....I have just gotten my LOWEST BEAR READING since my 2001 reading of 31.58 which lead eventually to BOTTOM OF BEAR AT 20.54...........A YEAR LATER! avery sharp RALLY ensued after 2001 lows (partly caused by post 911 selling (weeklong)
I am leaning on watching for BUYING OPP, maybe best since BEAR BEGAN (heading into Pres cycle lows maybe?) which would FALL apart next year and hopefully lead to ultimate lows....making this a 2 yr bear - 2.5 yr bear....boy what a dif landscape we will have.
http://www.kwaves.com/ without wild credit creation our economy cannot sustain itself....we are in midst of worst credit/debt destruction.....has it JUST begun? as we watch fired workers file out of LEHMAN...now Hewlett PAckard.....
Monday, September 15, 2008
Surely a 90% downside volume day, they are getting closer together.
My Bear bottom indicator fell to 37.62. VIX SOARED to over 31, another spike could lead to better chance of rally attempt.
I suspect FED will try something tomorrow, after which I will reasess, or if downer follow thru in AM
Long day for me, that's all I got. I hope I was able to save even one person from taking any huge hits here, my blog now 4.5 yrs old....and that Head and SHoulders pattern did as I suspected no?
Banks make money when they lend, they cant lend, don’t have capital reserves and are AFARID to loan!
This is a wakeup call to America, like WWII this can never happen again, so you have to chase Fox out of Henhouse.. WHO was watching this all play out, the housing bubble and did nothing? The Federal Reserve system and Hank Paulson were nowhere to be found except now as they pick and choose who gets BAILED OUT and who is saved (CHINESE BOND HOLDERS)
PLEASE MENTION PIMCO HAD TON OF LEH PAPER!!!! HE is very self serving Mr Gross.
WE are heading for KOndratief Winter as it is a CONTRACTION of credit we have now and it wont turn on a dime.
WHAT FUELED ALL THESE BUBBLES was ever expanding credit.
WHAT FINANCIAL PLANNER, even JOhnathon advised clients to SELL, RAISE CASH? Instead of “invest for long haul” or “It’s not timing market it’s time in the market”
I’ve been on sidelines for some time now,, 100% cash, because I saw this coming and I wont come out of bunker until I see it is past.
This isn’t end, contagion is spreading. G-d help us. WHAT OF ALL THE POSITIONS and DERIVITIVES going to unwind? And how these frims in trouble effect that? BIGGEST BUBBLE OF ALL!
IN A BEAR MKT< STAND ASIDE
I am thinking let's watch for a LOW in first 1hr 1.5hr and price of UYG for hints. I am thinking 50 BASIS from FED Tuesday.... I am MORE inclined (crazy) to look for long opps here I am not comfortable jumping on bank bandwagon, might let things clear after Tuesday FED meeting to reasess..
Sunday, September 14, 2008
http://research.stlouisfed.org/publications/usfd/page3.pdf parabolic attempt?
The problem is systemic. Bailouts and other government measures have minimal impact because they are not inciting heightened Credit expansion. (NOLAND) w/o expansion we have? contraction....and KOndratief W ! IT IS HERE
Noland...here is why ONE (coulda but) S NEEDED to wait and see....
"Perhaps Sunday we’ll read news of BofA acquiring Lehman – and perhaps the markets will rally big on such news. "
Goldman and Morgan: The anti-Lehmans
Wall Street on red alert11:16pm: As bankruptcy looms for Lehman, Fed and group of ten top banks expand lending to banks. Plus: Merrill and Bank of America close to deal. more
Bank of America and Merrill nearing merger
AIG plans sales to raise billions
A Lehman executive, who declined to be identified, told Fortune "this looks like the end."
Instead, Bank of America was reportedly in merger talks with Merrill Lynch (MER, Fortune 500), according to news reports. Both the Wall Street Journal and the New York Times reported that a deal, which could be worth about $40 billion, could come as early as Sunday night.
Hours before Bank of America pulled out, Barclays had abandoned talks to buy Lehman (LEH, Fortune 500), a source close to the situation told CNNMoney.com.
BDI crashing thru support ater support
Baltic Exchange Dry Index (BDI)Recent,
exponential average in red.
NEXT CHART SHOWS A "cautionary tone???" do not deny its significance
Baltic Exchange Dry Index (BDI)
& Gold (gold)
wait and see, the HAIR GUY will be asking all kinds of dumbass qustions......then they'll make Roubini anchor....
If gold IS really taking off....and you might ask if not now whenever? and I mean to the MOON....buying tomorrow will pay off handsomely.
early morning extreme 1st move. Ill stand by it...maybe to 10:30 then rally try OR all out crash....if you are in CASH you are short....and should be ready on a decent signal to pick up the slightly less than mortally wounded
WELL said this weekend (religious read for me) Doug Noland...and even he expected a FED LEH MIRACLE AND GREEN ROCKETING SPX'S but spiraling downard crisis
here we go!
(Fortune Magazine) -- The sad fate of Lehman Brothers is a cautionary tale of what's gone wrong with Wall Street.
Lehman (LEH, Fortune 500) borrowed too much money, put too much of it into deals of dubious quality, and then insisted for months that all was well when it was apparent that all wasn't well. It's a sad fate for a firm once regarded as prudent and well managed.
BEAR BAILOUT BUT NOT LEH???????????????????
For example, last October, with the real estate collapse well underway, Lehman (in partnership with the Tishman Speyer real estate firm) paid a whopping $22.2 billion to do a leveraged buyout of a big apartment developer, Archstone.
Six months earlier and five blocks away, a similar scene played out as Bear Stearns collapsed. Tonight I'm wondering how many more crash and burn nights like this Wall Street, the markets and our economy can take.
A Lehman 'bad bank' may be good
The key to a rescue of Lehman Brothers may lie in the government convincing healthier rivals to pay to isolate its bad assets.
By Colin Barr, senior writer
Last Updated: September 14, 2008: 11:48 AM EDT
As part of the frenzied effort to stave off a collapse at Lehman Brothers (LEH, Fortune 500), regulators are reportedly pitching industry executives on a new variation of an old theme: splitting the good assets from the bad, and placing the bad assets into a new company that will hold them until the markets turn up.
Baltic Exchange Dry Index (BDI)
& Crude Oil (red)
NOW PLEASE KEEP GoING AND READ THIS
To Big to Suffer a Loss: http://www.prudentbear.com/index.php/commentary/creditbubblebulletin?art_id=10111
My H and S is..well coming true!
Friday, September 12, 2008
Tuesday, September 09, 2008 4:52 A SECTOR MANY THINK IS BOTTOMING
Posted by M1
LOTS OF INSIGHT HERE MY FRIENDS
Thursday, September 11, 2008
Days of selling bring MORE PUNCH and CONVICTION than days of BUYING.......rally effort may have already expired....
OVERSEAS markets hurting big time, some down 50% or more, Chinese mkt has yet to find a bottom...will it retrace ALL it's gains?
US $$ above 80.00 Resistance in AM trading, Gold punked again, HUI 258 level might give heave ho
I am thinking unwinding yes, and maybe signal of deflation.
Labor markets weakening, asset values not stabilized.....SUCKING IN ALL INTO A VORTEX
Dividend tax cuts protect ONLY THE WEALTHY and should be rebuked! Wealthy have shifted assets into dividend payouts and are taxed at rate of 15% !! WHERE is equality there?
WHat else can our gov or FED own in this purge?
Tuesday, September 09, 2008
One back test had 9.0 bottom other 2 were between 20.0 -21.0 Of course I do not know if it will act the same but I am pretty confident this is a useful tool.
In other words If other things looking good (or very bad!) and my indicator comes down to 21 area I would be ready to deploy some cash….more depending on other things.
This is my proprietary indicator I share but it is also a chart which I keep to myself. I am not saying do a damn thing, what do I know....just some guy on a blog right? I am here laying out what I personally think and what I may do myself....call me crazy.
I did trade today, I will share that. I wanted back in SDS (2X short SPX) and early I had signal, but I didnt have time to concentrate, as I have day job.
When I came back SDS moved from up 40 cents to up $140 or so. Oh boy, here we go again...will I watch it go and say missed it? NOPE, I charted in another time format using a cool choice of MA'S, some I have not used together before and in a 15 minute set up I like that and I liked what I saw, now SDS was near $69.25 !!! DOH!!!
BUt rather than get pissed, I didnt get best price, I trusted my chart and got executed at $69.016 per share. Turned out good execution as I know many watched it go....I think for me I have worked hard at TA, and I trusted what I saw......I felt I HAD TO EXECUTE TRADE...because I will NEVER KNOW which ones are the "good ones'.
I have decided for now, in a bear too I am a "TREND TRADER", I use mixture of trend lines and MA's, figuring where to exit is not easy eother, so I will work on figuring what I am looking for, always have stops and exit strat.
Today was my best trade (still open) since I came back to trading after maybe 8 yrs absence.
I DO think SDS is likely to challenge recent high when it cleared $70 and closed above. I MAY sell on a gapper down at open should I be lucky to see that, as we did close on lows. ANd you know hopefully be blessed enough to move stops up.
I could feel the panic, LEH and too many to list...stocks getting KILLED.....and if buyers wont STEP in....prices will come down....
Lots of down volume crushing the 300pt up day big time.
I am sorry dear readers, I dont like bearing BAd news but I hope to keep some out of harms way should my views be true.....you play the odds baby....my buddies LOVE CASH been SAFE.
GOLD...even goldies been crushed bad....where is safe? CASH?
FED made BOLD move BAILING OUT FNM....trying to stem hailstorm.....next day usually real reaction......WILL FED BAIL LEH, or GM and F if needed....will they OWN America?
What has failed maybe needs to fail, SHIT WHAT does the GVO run well?
WELL I Ask what bullets FEd remians in holster? nd has anything they done worked or has it made it worse.
Monday, September 08, 2008
below excerpt, I reccomend you read its entirety (let's worry LESS about NEWS STORIES AND GOV ACTION and MORE on MAKRETS REACTION and TA)
By taking control of Fannie and Freddie, the Treasury Secretary risks making it harder for other troubled financial firms to raise money.
By Colin Barr, senior writer
September 8, 2008: 7:44 AM EDT
NEW YORK (Fortune) -- Treasury Secretary Henry Paulson has tamed the two-headed housing-market beast known as Fannie Mae and Freddie Mac - but not without adding to the uncertainty swirling through the financial sector.
Paulson announced plans Sunday to put Fannie (FNM, Fortune 500) and Freddie (FRE, Fortune 500) under government custody, including replacing their CEOs, ending common and preferred dividends and creating a new class of preferred stock that will be senior to existing shares - meaning existing shareholder stakes were made less valuable.
The move aims to assuage bondholders' fears about the creditworthiness of the companies, and to persuade the foreign central banks that have been big buyers of Fannie and Freddie bonds that their investments are safe.
If investors buy into Paulson's program, mortgage rates should fall because Fannie and Freddie's borrowing costs will fall. That, in turn, could lessen the steepness of the decline in home prices.
But with the economy slowing and the U.S. financial system under severe stress from the collapse of the housing bubble, it's not clear that even full government backing for Fannie and Freddie will bring mortgage rates down substantially.
And, Monday's financial sector rally notwithstanding, Paulson's action carries risk: By raising questions about the terms on which the government intervenes with companies deemed too big to fail, Sunday's action could reduce access to private capital for struggling financial firms.
That the markets had their doubts about Fannie and Freddie is no secret. The 90%-plus plunge in their shares over the past year shows there was substantial doubt about the companies' finances over the long haul.
A surprise move
Yet Sunday's placement of Fannie and Freddie under government ownership nonetheless came as something of a surprise. In contrast to Bear Stearns, the brokerage firm that ran out of cash in March and was dashed off in a Fed-brokered fire sale to JPMorgan Chase (JPM, Fortune 500), Fannie and Freddie had plenty of cash on hand and weren't on the verge of collapse.
Unprecedented action, ALL foreign markets soared on the news except CHINA's ! The US $$ IS UP!!
I am long WFMI and may sell and certainly if lucky eneough move my stops UP! Lasting effects of weekend's announcements cannot be known.
If one was short going into weekend (STOPS will be taken OUT on a GAP UP) and shows the RISK when doing so.
I don't know the lasting effects, but areas I am watching are WILL LONG TERM RATES COME DOWN making mortgages more affordable, what will be UP volume today. What will US $$ do and its effects on exports...and more
Sunday, September 07, 2008
Candidates weigh in FNM
Saturday, September 06, 2008
Considering the four aforementioned attributes, and the fact that this GSE is deeply mired in scandal, Fannie Mae is no doubt being closely monitored by the Working Group on Financial Markets (a.k.a. the Plunge Protection Team — which reports directly to the President of the United States). Accordingly, we would take great pleasure in seeing Ben Bernanke, a member of the working group, asked the following questions — including the supporting commentary — the next time he appears in front of the House Committee on Financial Services.
After the collapse of the NASDAQ bubble in 2000, and after the shock of 9/11, the Federal Reserve came to believe that the United States was heading into a deep recession. As is typical of any central bank, the prescription to reinvigorate the economy entailed creating more money and granting more credit. By June of 2003, the Fed funds rate had been reduced to 1%. To be sure, this set America's housing market ablaze. And this is exactly what the Federal Reserve desired because it views housing as "…a key channel of monetary policy transmission."
A strategic cog in the monetary transmission mechanism is Fannie Mae. In the four-year period from 2000 to 2003, Fannie Mae's outstanding Mortgage-Backed Securities grew from $706.7 billion to an astounding $1.3 trillion. Moreover, its mortgage portfolio ballooned from $607.7 billion to $901.8 billion. With Fannie Mae financing one in every five home loans in the United States, didn't it ever occur to the Federal Reserve that it should look into this financial institution's accounting, management control, and credit quality systems? If this massive transmitter of money — Fannie Mae — was not up to the task of responsibly lending such vast quantities of money into existence, did it not occur to the Federal Reserve that it may have to clean up the mess it had a hand in making? Does the Federal Reserve have a plan to bail out the second largest financial institution in the United States?
**Now the same idiots that fell asleep (knowingly…) are in the fricken HENHOUSE!!!!!!!!!!!!!!!! I really cannot stand it…..when will the American people finally wake up…..like that Robin Wms film….awakening
Duratek and it's a SAD SAD DAY in US HISTORY. The FED was to be ON WATCH, what did they do? Used Interest rate policy along with the ARMS FNM and FRE (they still got FED HOME LOAN) to reinflate and create another BUBBLE......never ONCE intervening, and now got CONGRESSIONAL APPROVAL (how the f"@&% they do that?) and POWER and BLANK CHECK? that wasn't enough, now same nitwits take FULL CONTROL of the engine that has backfired in their face!!??
Well how do you do bend over America...grab your ankles and squeal
"If I had better foresight, maybe I could have improved things a little bit," he said last month in response to a New York Times report on his handling of risks tied to the housing bust. "But frankly, if I had perfect foresight, I would never have taken this job in the first place."
**IS THIS GUY AN IDIOT>???? how about how the hosuing BOOM was handled????
By Bradley Keoun
July 14 (Bloomberg) -- At an investor presentation in May, Citigroup Inc. Chief Executive Officer Vikram Pandit said shrinking the bank's $2.2 trillion balance sheet, the biggest in the U.S., was a cornerstone of his turnaround plan.
Nowhere mentioned in the accompanying 66-page handout were the additional $1.1 trillion of assets that New York-based Citigroup keeps off its books: trusts to sell mortgage-backed securities, financing vehicles to issue short-term debt and collateralized debt obligations, or CDOs, to repackage bonds.
Now, as Citigroup prepares to announce second-quarter results July 18, those off-balance-sheet assets, used by U.S. banks to expand lending without tying up capital, are casting a shadow over earnings. Since last September, at least $100 billion of assets have flooded back onto Citigroup's balance sheet, accompanied by more than $7 billion of losses.
``If you start adding up all the potential exposures, it's a huge number,'' said Sam Golden, a former ombudsman for the U.S. Office of the Comptroller of the Currency who now heads the financial-industry practice for restructuring adviser Alvarez & Marsal in Houston. ``The banks will say that it was disclosed. Investors are saying, `Yeah, but it was cryptic. We really didn't know what you were telling us.'''
U.S. banks already are reeling from more than $165 billion of writedowns and credit losses, so shareholders are wary of unknown obligations that might force them to take responsibility for additional troubled assets. The risks have become so obvious that accounting officials are proposing new rules -- some of which Citigroup opposes -- that would force many assets back onto balance sheets.
On the Hook
Seven of the biggest U.S. banks, including Citigroup, are on the hook for at least $300 billion of credit and liquidity guarantees for off-balance-sheet loans and bonds, according to a June 30 report from consulting firm RiskMetrics Group Inc. in Rockville, Maryland. Such guarantees were remote when pledged as an inducement to bond buyers. Now, the first year-over-year decline in housing prices since the Great Depression and rising home-loan, commercial-mortgage and credit-card delinquencies have begun to trigger them.
``You will rapidly realize what a farce these off-balance- sheet things are,'' said Ladenburg Thalmann & Co. analyst Richard X. Bove. ``You could pick up a lot of loan losses with the stuff you're putting back on.''
It's impossible to predict what the losses might be from off-the-books assets or liabilities because disclosures are thin relative to what is required for balance-sheet assets, said Neri Bukspan, chief accountant for Standard & Poor's in New York.
``A lot of information tends to disappear or becomes second or third class,'' Bukspan said.
Citigroup has had to bail out at least nine investment funds in the past year, including seven structured investment vehicles, or SIVs, whose funding withered. The bank had to assume $45 billion of securities from those SIVs, which are now included in the $400 billion of on-balance-sheet assets Pandit says he's trying to unload in the next three years.
The bank probably will report a second-quarter net loss of $3.7 billion later this week, according to the average estimate of seven analysts surveyed by Bloomberg. A loss would be the company's third straight and add to $15 billion of losses recorded during the previous two quarters.
Citigroup plunged 69 percent in the past year in New York Stock Exchange composite trading. It closed at $16.19 on July 11, down 52 percent from April 6, 1998, when Citicorp agreed to form the modern company by merging with Sanford ``Sandy'' Weill's Travelers Group Inc.
JPMorgan Chase & Co., which has more than $400 billion of off-balance-sheet assets, also reports second-quarter results this week. The New York-based bank, the largest U.S. bank by market value, may say second-quarter profit fell 55 percent to $1.9 billion, analysts estimate.
Merrill Lynch & Co., the third-biggest U.S. securities firm by market value, also reports results this week. New York-based Merrill had to buy about $4.9 billion of mortgage-linked assets last year from an off-balance-sheet financing vehicle, resulting in a $170 million loss. It may post a second-quarter loss of $1.56 billion after reporting about $14 billion of net losses in the previous three quarters, according to a Bloomberg survey of 11 analysts.
``The riskiest assets we had, our CDOs, weren't even on our balance sheet,'' Merrill Chief Executive Officer John Thain said on a June 11 conference call with investors. Merrill would have to provide $15 billion in financing for CDOs and related obligations under a ``severe stress scenario,'' according to a Merrill regulatory filing published in May.
The Financial Accounting Standards Board, the five-member panel in Norwalk, Connecticut, that sets U.S. accounting rules, voted earlier this year to eliminate ``qualifying special- purpose entities,'' or QSPEs, a category of off-balance sheet financing exempted from tighter standards enacted following the collapse of U.S. energy trader Enron Corp. FASB also plans to clamp down on ``variable interest entities,'' or VIEs, that banks used when their vehicles couldn't qualify as QSPEs. And it voted June 11 to force banks to consolidate off-balance-sheet assets whenever an ``obligation to absorb losses can potentially be significant.''
Banks are required to disclose their off-balance-sheet assets in annual reports. According to Citigroup's most recent financial statement, filed in May, the bank's $1.1 trillion of off-the-books assets as of March 31 included $760 billion of QSPEs and $363 billion of unconsolidated VIEs.
``Our quarterly financial report provides full disclosure of our off-balance-sheet assets, including our maximum exposure to assets in unconsolidated VIEs,'' Citigroup spokeswoman Shannon Bell said. That figure was $141 billion as of March 31 and included funding commitments and guarantees, company reports show.
To lose the full amount, all the assumed assets would have to be written down to zero. The figure exceeds Citigroup's market value of about $90 billion, which dropped more than $180 billion since the end of 2006.
Citigroup's financial statement also says that about $517 billion of the QSPEs are related to mortgage securities, and that they are ``primarily non-recourse,'' which means the risk of future credit losses is transferred to purchasers.
Sharon Haas, an analyst at Fitch Ratings, said anyone who has studied Citigroup's disclosures would be familiar with the off-balance-sheet risks.
``A lot of these so-called off-balance-sheet exposures, there's no mystery about this,'' Haas said. ``Whether they're on or off balance sheet is frankly not as important from an analytical perspective as understanding the inherent nature of the businesses that they're involved in.''
Pandit, 51, who replaced Charles O. ``Chuck'' Prince III as CEO in December, said in a June 27 report posted on Citigroup's Web site that regulatory reform must include ``public disclosures to investors about pertinent risk and financial information that give the market a chance to make informed judgments.''
The comments came after Robert Traficanti, Citigroup's deputy controller, sent a letter to FASB Chairman Robert Herz on June 9 objecting to a provision that would force banks to reevaluate their off-balance-sheet assets and liabilities every quarter. Citigroup has more than 7,000 VIEs and more than 100 QSPEs, he wrote.
``We believe that this model is impractical from an operational standpoint,'' Traficanti wrote. ``We would not be able to perform this analysis given the resources we currently have. We would need to hire many more accountants.''
Regulators may part ways with accounting overseers and grant banks a waiver from having to raise capital against assets that have to be consolidated on the balance sheet, said Tanya Azarchs, a managing director at Standard & Poor's in New York.
``They really don't want to introduce any more instability into the banking system,'' Azarchs said.
Mortgage-finance agencies Freddie Mac and Fannie Mae plunged to their lowest in 17 years in New York trading last week, partly on concern that off-the-books assets might swamp their capital.
James Lockhart, director of the Office of Federal Housing Enterprise Oversight in Washington, said on July 8 that an ``accounting principle should not drive a capital decision by a regulator.''
That doesn't mean regulators aren't paying attention. Examiners keep offices inside the headquarters of large banks, and they have access to non-public records that help them analyze off-balance-sheet risks, said Bill Isaac, a former Federal Deposit Insurance Corp. chairman who is now chairman of Secura Group, a consulting firm in Vienna, Virginia.
``The bank examiners are probably more thorough now and even skeptical in looking at these things,'' Isaac said. ``They're probably doing more what-if scenarios and stress tests. People thought there was a 1-in-100 chance of something happening, and as we see now, it has happened.''
Citigroup had $25 billion of ``liquidity puts'' -- a kind of guarantee -- last year on off-balance-sheet ``commercial paper CDOs'' set up to sell short-term debt known as commercial paper, according to the May financial statement. In the second half of the year, after a surge in market rates for the commercial paper, the bank had to preempt the formal exercise of the guarantees by buying the debt, according to the statement.
By the end of 2007, the full amount had been brought back on the books. The assets had to be written down by $4.3 billion in the fourth quarter and $3.1 billion in the first quarter. The remaining balance stood at $16.8 billion as of March 31.
The commercial-paper CDO assets are in addition to the assets Citigroup took over last December from its failing SIVs. In that case, the bank didn't have a contractual guarantee; it intervened to cushion the losses for its clients. Citigroup had $212 million of losses related to the SIVs in the first quarter, according to the financial statement.
``People say they don't have any liquidity backstop, they don't have any guarantee,'' said Russell Golden, the FASB's technical director. ``But then they act like they always had a guarantee.''
Murkier still are the $15 billion of assets Citigroup has had to import this year from four off-balance-sheet hedge funds that unraveled. They include the Old Lane hedge fund that Pandit helped open in 2006. Citigroup bought Old Lane Partners LP last July for about $800 million. Earlier this year, the bank said it would close the fund because Pandit and other Old Lane founders had moved on to management jobs at the bank.
Citigroup incorporated about $9 billion of Old Lane assets into its trading desk.
`Back to Roost'
``You had risks off the balance sheet that came back to roost,'' said Marc Siegel, head of accounting research and analysis at RiskMetrics.
While Citigroup has more off-balance-sheet assets than its peers, it isn't alone. Bank of America assumed about $6.6 billion of commercial paper issued by off-balance-sheet CDOs last year. About $5 billion related to ``written put options'' and $1.6 billion related to ``other liquidity support,'' according to the Charlotte, North Carolina-based bank's financial statements.
Bank of America held $32.1 billion of VIEs on its balance sheet as of March 31, compared with $22.4 billion at the end of 2006. It still has $43.2 billion of VIEs off balance sheet.
JPMorgan has off-balance-sheet ``conduits'' with about $54 billion of commercial paper outstanding, according to its first- quarter financial statement. The bank says it is ``not obligated under any agreement'' to buy the debt. Even so, the bank provided a chart showing the impact if assets had been consolidated: First-quarter net income would have been $2 billion instead of $2.4 billion.
``As soon as the cycle turned, all of these risks started to come back, and companies weren't prepared,'' Siegel said. ``It wasn't transparent to the investors what was going on.''
To contact the reporter on this story: Bradley Keoun in New York at email@example.com. Last Updated: July 13, 2008 19:01 EDT