"including those underpinned by U.S. mortgages"
Humm Now the US is the whipping boy for every other country's write-downs. Time for US to mark to market or lose all confidence in our own market. LOL

gm | 09.30.07 - 6:32 pm |
"call me crazy, but i took the money out of ING after reading about the buyout. my main problem with internet banks is that i can't go to a branch to get my paper money if i need to. their security model is very sophisticated but convoluted, too."

How about this!

"Would you be prepared to keep your life savings in an account that could be frozen for up to 60 days if the bank thought its financial stability was threatened? After the events of last weekend, few would answer with an unequivocal "yes". However, that is exactly the position in which savers with internet bank Egg now find themselves."

"Money has this week been poring over the terms and conditions of many of the UK's most popular e-savings accounts and found that the banks have no liability if their website is brought down. Others have terms and conditions that allow them to shut down the website to halt mass withdrawals.

Egg, owned by the US giant Citibank, has a clause that allows it to stop customers removing money if it thinks its "financial stability" is threatened. It says: "In order for us to run our business lawfully and with prudent liquidity levels, in exceptional circumstances, we may need to suspend your right to take money out of an account for a period of up to 60 days."

This is a good read.

Hard-boiled Egg stuns savers |
Money |
The Guardian

Private student loan bubble could burst

The near doubling in the cost of a college degree the past decade has produced an explosion in high-priced student loans that could haunt the U.S. economy for years.

While scholarship, grant money and government-backed student loans -- whose interest rates are capped -- have taken up some of the slack, many families and individual students have turned to private loans, which carry fees and interest rates that are often variable and up to 20 percent.

Business finance news - currency market news - online UK currency markets - financial news - Interactive Investor

Topher, what you mention is exactly what happened in Argentina. The money was still showing in everyones accounts but there was a daily limit of how much could be removed for their accounts. All this while the Argentinian Peso devalued to 1/3.

FFDIC-

Soooo, NetBank alone cost $110M and total loss reserves for the year are $111M... no too reassuring. What are the implications here?

BTW, you are a great contributor to this blog, thanks!

While I'm at it, how big a loss is $2.6B for UBS? How big is that pool of assets that they've written down?

Lost in Translation
Yes, and there are still plenty of old FDIC farts making $150,000 plus who can recall the 80s horrors which makes this 2007 reporting even more stupid in my jaded eyes. Maybe a 26 year old contractor wrote it.

Bill Threatens Stock-Option Tax Break

Sen. Carl Levin wants financials and tax returns to show the same stock-option expenses.
Sarah Johnson, CFO.com
September 28, 2007
Sen. Carl Levin (D-Mich.) introduced a bill Friday that would change the way companies deduct stock-option expenses on their tax bills. The legislation, his third try at such a bill, could have added momentum because of the recent regulatory focus on accounting for stock options. Lawmakers' concerns about the disparity between executive and worker pay could also move the bill further along.

Levin criticized the "growing chasm" between executive pay and that of the rank-and-file in a press release announcing his bill. He also called the current accounting standards and tax rules for stock options "off-kilter," claiming they have led to "huge tax windfalls for companies that pay their executives with large stock grants."
Bill Threatens Stock-Option Tax Break - - CFO.com

The rest. Sorry got cut off.

to give them confidence, ensuring that their savings in a bank or building society are guaranteed."

Yet the £35,000 guarantee that comes into effect today means only an extra £3,300 of savers' money is protected.

my main problem with internet banks is that i can't go to a branch to get my paper money if i need to.

Is State Farm Bank considered an internet bank ?

I am aware that some helpful services are provided to customers of SFB by the local SF agents ( stuff like filling out the paperwork to open accounts / CDs / etc ).

Continued robust growth in emerging markets points to persistent upward pressure on commodity demand and, hence, commodity prices. For the industrialised world, inflationary pressures may therefore remain elevated even if growth is slowing. Whereas in the late 1990s US growth was strong but inflation was low, there's now the risk that growth weakens with inflation remaining stickily high. What, then, should central banks do? Cut interest rates in the hope that inflation eventually subsides? Or leave rates unchanged, risking a collapse in economic activity?

For the Federal Reserve, rapid rate cuts might eventually have to be the order of the day. Politically, it's difficult to imagine US policymakers presiding over rising unemployment and shrinking economic activity, whatever the rate of inflation. The story, though, might not end there. Falling US interest rates would make the control of inflation even more difficult within the emerging world, eventually increasing the temptation to "go it alone" and leave the dollar to its own destiny. Might this lead to a dollar collapse, a loss of US monetary credibility and the end of an economic pax Americana?

Perhaps this is a fairy-tale too far. I sense, though, that recent events are not a one-off, a repeat of LTCM. Instead, the story unfolding is one full of sub-plots, geographical intricacies and economic dependencies. It may finish happily ever after. But it might, instead, end up like one of those novels from my namesake, a horrific mixture of weak growth, sticky inflation and, ultimately, a loss of confidence in the dollar's status as a reserve currency.

Stephen King: The great American economic horror story -
Business Comment, Business - The Independent

No kidding.

Commodity boom?

Not necessarily.

Ethanol Boom Runs Out of Gas
By Lauren Etter and Ilan Brat
Word Count: 1,161 | Companies Featured in This Article: Archer-Daniels-Midland, VeraSun Energy

Ethanol's frenzied growth over the past year is coming to a halt -- at least for now.

The price of ethanol has fallen by 30% over the past few months as a glut of the corn-based fuel looms, while the price of ethanol's primary component, corn, had risen. That's squeezing ethanol companies' profits and pushing some ethanol plants to the brink of bankruptcy.

Financing for new ethanol plants is drying up in many areas, and plans to build are being delayed or canceled across the Midwest, as investors increasingly decide that only the most-efficient ethanol plants are worth their money.

link

Ethanol boom fades as oversupply depresses prices

"EVADA, Iowa: The ethanol boom of recent years — which spurred a frenzy of distillery construction, record corn prices, rising food prices and hopes of a new future for rural America — may be fading.

Only last year, farmers here spoke of a biofuel gold rush, and they rejoiced as prices for ethanol and the corn used to produce it set records.

But companies and farm cooperatives have built so many distilleries so quickly that the ethanol market is suddenly plagued by a glut, in part because the means to distribute it have not kept pace. The average national ethanol price on the spot market has plunged 30 percent since May, with the decline escalating sharply in the last few weeks.

"The end of the ethanol boom is possibly in sight and may already be here," said Neil E. Harl, an economics professor emeritus at Iowa State University who lectures on ethanol and is a consultant for producers. "This is a dangerous time for people who are making investments."

While generous government support is expected to keep the output of ethanol fuel growing, the poorly planned overexpansion of the industry raises questions about its ability to fulfill the hopes of President George W. Bush and other policy makers to serve as a serious antidote to the nation's heavy reliance on foreign oil."

Link

also

Study: Ethanol Boom Could Bust

Maxed Moma-
Actually hon the FDIC does have reserves for the future but they are not unlimited reserves as we all know. Congress will have to ponie up funds at come future point just as they did when Wild Bill Siedman was chairman in the 80s and the fund basically ran out of money.

Financial Times.com

US court to rule on third-party liability

"Professor Donald Langevoort of Georgetown University Law Center, who calls the case the "Roe v Wade" of securities law says the court could choose a middle path between shareholders and companies."
FT.com / US & Canada - US court to rule on third-party liability

dryfly

yep.

Latest National Geographic Article claims that for every one unit of energy put into corn ethanol you got 1.3 out.

Sugar Cane by comparison is 1 in 8 out.

Also Corn releases a lot of CO2 in to the air, and uses fertilizer in the corn production as well as gas to produce.

National Geographic - 404 Error - Page Not Found

"Biofuels as currently rendered in the U.S. are doing great things for some farmers and for agricultural giants like Archer Daniels Midland and Cargill, but little for the environment. Corn requires large doses of herbicide and nitrogen fertilizer and can cause more soil erosion than any other crop. And producing corn ethanol consumes just about as much fossil fuel as the ethanol itself replaces. Biodiesel from soybeans fares only slightly better. Environmentalists also fear that rising prices for both crops will push farmers to plow up some 35 million acres (14 million hectares) of marginal farmland now set aside for soil and wildlife conservation, potentially releasing even more carbon bound in the fallow fields. "

FFDIC - you don't think that Netbank is going to tip over the next one? Which makes it all the more likely that the next one tips over? From where I sit, it's looking like a debacle (and I'm here on the ground with the rest of flyover country).

Once the strategy of forced sales failed, this was bound to happen. I cannot see any way that the Netbank failure doesn't result in the slinky having been released on the top stop. The whole industry has been living in a cloud of complacency, but big Netbank depositors will lose money.

Ethanol Boom Runs Out of Gas

Anyone who follows any of the ethanol wall street pump and dump story stocks could have told you that about, Oh a year ago. Nice to see that the financial news media has noticed and were on top of that.

Citigroup sees 60 pct drop in Q3 net income

CEO Charles Prince said in a statement the decline had been driven "by weak performance in fixed-income credit market activities, write-downs in leveraged loan commitments, and increases in consumer credit costs."

Among the principal culprits for the warning were $1.4 billion in pre-tax write-downs on funded and unfunded leveraged loan commitments.

Citi also said it was taking $1.3 billion in pretax losses on the value of subprime mortgage-backed securities it had warehoused to repackage into collateralized debt obligations, and leveraged loans it had planned to repackage into collateralized loan obligation securitizations.

Expired

"Our role in the project is to solve one of those "ifs" and rigth now it looks like it will be possible very soon."

Cool sooner the better.

oops:

meant FDIC's loss reserves were $111,000M not $111M (with Netbank costing $110M)

RE: FDIC (balances, cash flow, etc.)

FDIC: Risk - Based Assessment System

I just want to know why that report is dated Oct. 2? Reporting from the future...wow.

(Also, from a couple of days ago, Thanks for the information, Steve!)

Best regards,

"It's a little bit earlier and a little bit deeper," Laura Phillips, Wal-Mart's chief toy officer, said of the timing of this year's holiday toy promotions and the size of the price reductions.

Thats going to be an ugly move. WM dropped layaway last season, so its a "show me the money" kind of thing. IMHO, they are trying to stab the life out of TRU and KM (Target being a toy retailer, but not as big as the others). TRU and KM will have little choice but to respond in kind.

Yesterday I peeked into a TRU and made a quick assessment on their stock levels going into this holiday period... from what I saw, they must be expecting huge sales this year.

Which lead me to wonder...

Is CC balance-transfer the new MEW ?

When it comes to price cuts, 'earlier and deeper' is usually not a good sign.

I just hope they hold off on the damn Christmas music until after Thanksgiving.

I forgot, I started writing the last post while an oompah bad was playing "Happy Days are her again" in the only empty tent @ stuttgart's wesen fest.

My irony meter exploded.

sorry: I guess my coffee didn't kick in: they've moved up the date from Friday (19) to Monday (15)...