I'd be a seller too if I owned millions or billions of dollars worth of Fannie or Freddie equity/debt. I don't see how these entities last through a very slow fall & winter home selling season in 2008.
It seems like everyone wants to get out of the way of this trainwreck.
Sorry to highjack a brand new thread, but this is too amazing! I hope the SEC investigates this one (rumor for profit??)!!
Bloomberg mistakenly publishes obit for Apple CEO Steve Jobs
An obituary for Apple Inc. CEO Steve Jobs was mistakenly published by Bloomberg News on Thursday, according to several reports.
The stock story detailing the death of the Cupertino-based Apple (NASDAQ:AAPL) founder, who is still alive, appeared momentarily after a reporter had updated it, Bloomberg said. The incomplete obit was distinctly marked Hold for release Do not use, the reports said
Following is the opening paragraph as it appeared on the Bloomberg wire:
Steve Jobs, who helped make personal computers as easy to use as telephones, changed the way animated films are made, persuaded consumers to tune into digital music and refashioned the mobile phone, has XXXX. He was TK. Jobs XXXX, TK said XXXXX.
Bloomberg, which was founded by New York mayor Michael Bloomberg and prides itself on its accuracy and transparency, later published a note acknowledging the story's retraction on its wire.
Glad that the Chinese are waking up. Terrible if the Chinese government stood idly by while their hardworking people had their savings go up in flames.
Our financial system and household and government budgets needs some bitter medicine and shock therapy, and I hope the Chinese, Japanese, and sheikhs administer it soon (before they get stiffed, because they will).
Also we should reassure China that the US treasury will use public debt to provide an insurance policy against steep declines in the value of Freddie and Fannie bonds.
Aren't Fannie/Freddie like insurance companies, with their huge portfolios couldn't they just go into run off and generate cash?
They have been shrinking the volume of loans they are purchasing if they get that volume below the amount of prepayments they get a month then that is a way of rebuilding their capital base. Ginnie and the FHLB are alternative funding sources as is community banks.
I don't think nationalization is likely or needed. I just think Paulson was trying to keep the spreads low so the GSE's wouldn't have to back away from purchasing as much.
That 3.3% GDP number is probably a combination of the weak dollar boosting exports and the absurdly low rate of inflation used in the GDP calculation.
Having a realistic GDP figure is so dependent on calculating inflation correctly that it's hard to take it seriously, especially before its been revised.
I think it's more useful to look at concrete economic factors that have been reliable in the past. Less subjective data like high jobless claims, weak retail spending, falling tax receipts, declining squirrel populations, etc. seem to paint a gloomier picture.
Mel writes:
Taiwan is toast soon. Now that the Olympics are over, and China controls so much in the USA, Formosa would be wise to yield proactively.
Mel | 08.28.08 - 8:45 pm | #
Oh I don't know - its worked good for Georgia to kick sand in superman's face why not Taiwan? What could go wrong?
more like MBIA, they insure their own bonds.
so for bonds they insure the hit is over time.
however they also have their own portfolio - mostly mortgages they were not able to package and sell.
FRE and FNM are currently in the hole about 50Billion.
They have 200-300 billion in Alt-A mortages that are now starting to go bad.
They have been delaying forclosing on homes by making the money owed a 2nd loan.
And the resulting flow has been huge and until recently, it was getting bigger. It now seems to have come to something close to a stop. Unless it restarts quickly, I suspect the US government will have to make its role in the process explicit.
In the short-run, the US needs this directed credit program to continue. Demand for non-Agency MBS has disappeared. And if credit isnt available to buy homes, home prices will fall further, faster adding to the distress of the US financial sector.
In the long-run, though, the US probably shouldnt continue to favor investment in housing over investment in other sectors (to be precise, the US supports borrowing to buy homes, and thus indirectly supports the housing sector) to quite the degree it does now. The United States skill at turning mortgages into foreign exchange reserves interacted with Chinas desire to avoid renminbi appreciation to produce an unhealthy economic cocktail.
The US buys its own bonds with offshore accounts in the Cayman Islands. Think I'm nuts? This purchasing has gone from the single digit billions in the 1990s to something like 130 billion/year. You think Jamaicans are buying our debt? you think millionaires are hiding their money buying our bonds through offshore accounts? No way...they are trying to get their money OUT of US assets. The govt adds a 1 and a bunch of zeros into a computer and uses this "money" to buy its own bonds. Thats how you get 12% inflation without having to overtly "print". You'll see it soon. When inflation keeps getting worse and worse. You'll hurt when gas peaks in June 09' and then again in June 10' and then again in June 11. Peace
Now that the Chinese are pulling out ( with other countries sure to follow ) more and more middle class Americans will now be more deeply subjected to the massive ponzi financial scheme needed to perpetuate the increasingly fake bullshit US economy.
Don't you think the drug cartels have the equivalent of a SWF? And surely the cartels use the Caymans for banking. Hey its right on the flyway for their airplanes on the return trip.
Seems to me that the Cartels share many economic motives with China. So perhaps there is similar behavior.
George W. would seem a natural to negotiate with the Cartels.
OT: Boston, MAResearchers from Boston University's Slone Epidemiology Center have found that in a given week, over 10 million Americans are taking opioids, and more than 4 million are taking them regularly (at least five days per week, for at least four weeks). These findings appear in the August 31 issue of the journal Pain.
...The prevalence of regular opioid use increased over time and was highest in the South Central region of the country. Among regular users, almost half had been taking opioids for two or more years and nearly one-fifth had been taking opioids for five years or longer.
\t
And according to nida.nih
According to the 2003 National Survey on Drug Use and Health, which may actually underestimate illicit opiate (heroin) use, an estimated 3.7 million people had used heroin at some time in their lives, and over 119,000 of them reported using it within the month preceding the survey. An estimated 314,000 Americans used heroin in the past year,
Speaking of Caymans - anyone watching Gustav? I don't think they're going to get hit to hard but after that its setting up to be a real problem IF it follows anything close to the models...
On Cayman Brac, in Gustav's path:
I got this report last night from wunderground user mangroveman, who lives on Cayman Brac: The general feeling here is to be prepared and wait and see. Public Works has gotten most of the shutters in place on schools and other public buildings. They will finish up in the morning. Hurricane shelters are ready including the new Humane Society shelter for pets. The shelters are almost all on the Bluff, the limestone spine of the Brac which rises to 140 feet on the east end of the island and gives the Brac its name, and so are well out of the way of any storm surge.
Since Hurricane Ivan virtually destroyed Grand Cayman in 2004, many folks from there (as well as Brackers) have built themselves hurricane cottages on the Bluff, also well out of the way of any storm surge. I would say that about half the h omes here have their shutters up, and the rest should all be up -- or ready to go depending on the storm's strength -- by noon tomorrow.
Cayman Airways has added several jet flights between the islands--we are usually served by Twin Otters from Grand Cayman--for people who wish to get out of here--or there!
Business at the grocery and hardware stores has been steady, with the usual stocking up of supples. A lot of people went through this exercise not so long ago with Fay, and so most folks already have plenty of supplies.
The biggest concern here about the nature of the storm is that it has slowed down to a crawl, and, experience tells us that the slower it moves, the stronger it can become. However, general feeling is that Gustav is disorganized and will need to really pick up strength quickly if it is going to be a major hurricane that would threaten the Brac. One of the historic memory points on the island is 1932 when the Brac was whacked by a mega-storm which not only destroyed the island and killed 110 people, but also caused many families to leave. The '32 Storm has become a living legend, and most any hurricane that hits the Brac is compared to that storm. Most people feel Gustav will not measure up against the '32 monster. Which is a good thing, of course!
WASHINGTON (AP) -- Shares of Fannie Mae and Freddie Mac soared Monday in a respite from their battering in recent days, while some regional banks saw their stocks sink on worries they could be swept up in the turmoil surrounding the mortgage finance giants.
Freddie completed a $2 billion debt sale, and a Wall Street analyst said a government bailout of the mortgage finance giants may not be inevitable.
But a few regional banks with significant holdings in Fannie and Freddie preferred stocks followed the rest of the market down amid questions over whether federal regulators would step in to rescue the two government-sponsored companies.
Shares of Freddie jumped 48 cents, or 17.1 percent, to $3.29 Monday, while Fannie climbed 19 cents, or 3.8 percent, to $5.19.
Anonymous Bosch writes:
Tropical Storm HANNA is tracking even further north than GUSTAV along the Leeward Islands
Anonymous Bosch | 08.28.08 - 10:04 pm | #
Master's discusses that one too - models predict it is likely to cross over the northern part of the Bahamas then slam into SE US coast - possibly not far from where Lawyer Liz is [though most likely north of that and it could still recurve out to sea as it is expected to slow down].
Regardless we could have two major hurricanes hitting the SE US within days of each other.
Where is Brownie when you need him [they'll have to find another scapegoat and FAST]...
All bond spreads are wider relative to Treasuries. You should look relative to LIBOR (swaps). Then you'll see that GSE debt spreads have held in pretty well.
Mayberry Machiavelli is a satirically pejorative phrase coined by John J. DiIulio Jr., Ph.D., a former staffer of the George W. Bush presidential administration who ran Bush's Faithbased Initiative. After he quickly resigned from his White House post in late 2001, DiIulio told journalist Ron Suskind, describing that administration, as published in Esquire magazine: "What you've got is everything--and I mean everything--being run by the political arm. It's the reign of the Mayberry Machiavellis."
The phrase is meant to invoke infamous Machiavellian style power politics coupled with a prejudicial sense of regional backwardness and incompetence in the American south as supposedly exemplified by the fictional, small, rural, North Carolina town of Mayberry R.F.D., from The Andy Griffith Show which ran on the American television network, CBS, from 1960 - 1968.
The phrase, seeming so felicitously apt, was picked up and virally repeated by many critics of the George W. Bush presidency.
a.c.,
Regarding your OT topic on the absurd-looking 3.3% real GDP growth rate for the second quarter, here is a comment I posted on Economist's View.
"Much of the growth attributed to net exports is a statistical quirk, and the hacks at the Commerce Dept should have pointed this out instead of glorifying it.
See for yourself in the NIPA tables: BEA National Economic Accounts
Table 1.1.2 claims that Net Exports of Goods and Services added 3.1 points to real GDP (out of a 3.3 total). WOW!!
However, if you look at the actual current-dollar numbers, (Table 1.1.5) net exports of goods and services actually WORSENED from a $706 billion deficit to a $710 billion deficit.
There are several causes of this quirk, but the main one is that "real" imports are measured in 2000 prices rather than the prices we actually paid in 2008. Oil prices are the major culprit.
This has happened before, especially when oil prices surged."
I sure hope we don't get much more rain. The Indian River is still rising in some areas. As I posted before we are on an 8-10 inch hill AND we bought flood insurance. A neighbor's yard is still full of water. If Hannah dumps as much water as Fay did (unlikely, Fay was extraordinarily wet), we will flood here.
We were totalled in hurricane Andrew. Once in a lifetime is enough for that experience.
The acquifer is recharging only a little bit, according to a weather maven who works with the hub.
Oh my God, China stopped buying agency paper and the dollar didn't plunge to minus infinity! How could that be?
Wait until the most recent TIC data comes out. They are buying something or just rat holing the cash until they buy else the RMB goes to the moon vis a vis the dollar - supply demand - you don't run those kinds of surpluses & hold stable exchange rates without ONE of those things happening. It's probably treasury paper being bought now more than agency... from Setser:
Over the last year (think the period after the subprime crisis), central bank holdings of Agencies and Treasuries have increased by $419.5 billion with a clear shift toward Treasuries recently after a long period where Agency holdings were growing faster than Treasuries. This quiet bailout far exceeds the roughly $35 billion that sovereign funds have invested in US banks. The US TIC captured most of these investments, and its shows $34.2 in official purchases of US equities over the last 12ms, with almost all the increase coming right after the big recapitalizations. The total would be higher if UBS and Barclays are added in but also remember that many central banks dont use the New York Feds facilities, and some rely on outside managers for even a Treasury and Agency portfolio. Central banks likely added more than $420 billion to their total holdings of Treasuries and Agencies over the last year.*
$420 billion isn't chump change & that's JUST the central banks.
Invisible-However, if you look at the actual current-dollar numbers, (Table 1.1.5) net exports of goods and services actually WORSENED from a $706 billion deficit to a $710 billion deficit.
i don't think you've interpreted that right. you expect exports to be negative numbers and they actually increased from 706 to 710 as per the headline.
Worker Assets Shrink at Fannie and Freddie
"...workers had $116 million in the employee stock ownership plan at the end of 2006. Today, its more like $17.5 million. Ouch." Coming Home to Roost - NY Times
Don't worry, the talking heads on CNBC told me that the recession was over and the recovery is well at hand, we don't need the Chinese anymore. Thanks for helping out, though.
As the political spotlight shifts to the upcoming Republican convention in Minneapolis-St. Paul, GOP leaders are closely monitoring the movements of Tropical Storm Gustav, which is approaching hurricane strength as it heads toward the Gulf Coast.
Party officials are discussing the possibility of postponing convention proceedings if the threat to New Orleans and other Gulf Coast areas grows. If there is serious damage in the Gulf Coast, images of Republicans partying in Minneapolis-St. Paul could be an embarrassing reminder of the Bush administration's delayed response to Hurricane Katrina three years ago.
Dryfly, IMHO what we really need to worry about is when they start to loose faith in Treasuries. Then you know BWII is done with and the dollar is toast.
What worries me most is this Fannie/Freddy debacle has put the specter of what happens in an American default in the forefront of most SWF/FCB managers thoughts. They may not have been tasked with making a profit from these currency peg "investments" (their increased domestic GDP/export business was the payoff) but they sure the heck weren't supposed to lose the investment either. It's about to get interesting, the Fed may have to soon choose between protecting the dollar/funding the twin deficits when the CBs finally balk and maintaining the economy by letting the dollar tank.
The Chinese want to be "adequately compensated", as Yu Yongding has been quoted. I believe that their dollars could just as well buy American corn, soybeans, beef, and what's left of our income producing industry as treasury paper. I don't think they'll be interested much in our investment banks although leeches actually do have some medicinal value.
The problem is the TReasury market simply can't break or game over. So the strategy is to kleep that window opne and hoppe the market cures itself and in time the agency window reopens. by that time will be well north of 100 trillion all in with contingencies. Likley due north of $13 Trillion outright...that compares to dwindling tax receipts of sub 3. So bascially we are effectivily bankrupt. Withut a restructuring a la latin america no chance of recovery. Obama investing in hybrid technology four letters J O K E
It's also normal to cut a bit because
central bankers have injected around
$400b in agencies and T-bonds during the past 6 months.
They are no fool if it's useless they'll stop
So everyone shifted their purchases from agencies to treasuries at the same time that the gubment started issuing more treasuries to buy more agencies?
How long before it becomes clear that this entire country is a money furnace?
My guess is 6 months or less.
The theme of the next decade? The Greater Depression.
Idoc,
If you look at GDP Table 1.1.5 on the BEA website you'll see what I mean.
Net Exports are Exports minus Imports, and is a measure of the trade deficit. In the 2008:2 quarter, gross exports were $1927.6 billion while gross imports were $2637.6 billion, resulting in Net Exports of NEGATIVE $710.0 billion.
Net Exports in CURRENT DOLLARS went from -705.7 billion to -710.0 billion, which is a worsening of the trade defifit. Because of the quirks in the way REAL Net Exports is calculated, this current dollar worsening became a huge INCREASE in real GDP.
I don't know if I would hold Fannie or Freddie either even with the governement backstop. Hank seems like an Indian Giver.
so if japan is selling too, who is buying?
Japan’s Net Sales of Foreign Debt Reaches Record « naked capitalism
Tell China not to worry, we'll sacrifice US taxpayers on the altar in their name if they just keep buying our agency debt.
You saw the Fitch downgrade on WaMu covered bonds.....right?
So,what are they buying instead?
I'd be a seller too if I owned millions or billions of dollars worth of Fannie or Freddie equity/debt. I don't see how these entities last through a very slow fall & winter home selling season in 2008.
It seems like everyone wants to get out of the way of this trainwreck.
Sorry to highjack a brand new thread, but this is too amazing! I hope the SEC investigates this one (rumor for profit??)!!
Bloomberg mistakenly publishes obit for Apple CEO Steve Jobs
An obituary for Apple Inc. CEO Steve Jobs was mistakenly published by Bloomberg News on Thursday, according to several reports.
The stock story detailing the death of the Cupertino-based Apple (NASDAQ:AAPL) founder, who is still alive, appeared momentarily after a reporter had updated it, Bloomberg said. The incomplete obit was distinctly marked Hold for release Do not use, the reports said
Following is the opening paragraph as it appeared on the Bloomberg wire:
Steve Jobs, who helped make personal computers as easy to use as telephones, changed the way animated films are made, persuaded consumers to tune into digital music and refashioned the mobile phone, has XXXX. He was TK. Jobs XXXX, TK said XXXXX.
Bloomberg, which was founded by New York mayor Michael Bloomberg and prides itself on its accuracy and transparency, later published a note acknowledging the story's retraction on its wire.
Bloomberg mistakenly publishes obit for Apple CEO Steve Jobs - Silicon Valley / San Jose Business Journal:
Glad that the Chinese are waking up. Terrible if the Chinese government stood idly by while their hardworking people had their savings go up in flames.
Our financial system and household and government budgets needs some bitter medicine and shock therapy, and I hope the Chinese, Japanese, and sheikhs administer it soon (before they get stiffed, because they will).
OT
BBC NEWS | Business | US GDP rebounds with 3.3% growth
how that???????
lol, i guess work was a little slow so they started working on obits for famous people
Also we should reassure China that the US treasury will use public debt to provide an insurance policy against steep declines in the value of Freddie and Fannie bonds.
That way they'll stop buying our treasuries too.
Aren't Fannie/Freddie like insurance companies, with their huge portfolios couldn't they just go into run off and generate cash?
They have been shrinking the volume of loans they are purchasing if they get that volume below the amount of prepayments they get a month then that is a way of rebuilding their capital base. Ginnie and the FHLB are alternative funding sources as is community banks.
I don't think nationalization is likely or needed. I just think Paulson was trying to keep the spreads low so the GSE's wouldn't have to back away from purchasing as much.
OT
404 - Page Not Found
7586280.stm
how that???????
That 3.3% GDP number is probably a combination of the weak dollar boosting exports and the absurdly low rate of inflation used in the GDP calculation.
Having a realistic GDP figure is so dependent on calculating inflation correctly that it's hard to take it seriously, especially before its been revised.
I think it's more useful to look at concrete economic factors that have been reliable in the past. Less subjective data like high jobless claims, weak retail spending, falling tax receipts, declining squirrel populations, etc. seem to paint a gloomier picture.
jim writes:
So,what are they buying instead?
they're inflating, or so they say--stimulating their domestic economy
same old story--save you and yours and damn the difference
Taiwan is toast soon. Now that the Olympics are over, and China controls so much in the USA, Formosa would be wise to yield proactively.
Mel writes:
Taiwan is toast soon. Now that the Olympics are over, and China controls so much in the USA, Formosa would be wise to yield proactively.
Mel | 08.28.08 - 8:45 pm | #
Oh I don't know - its worked good for Georgia to kick sand in superman's face why not Taiwan? What could go wrong?
more like MBIA, they insure their own bonds.
so for bonds they insure the hit is over time.
however they also have their own portfolio - mostly mortgages they were not able to package and sell.
FRE and FNM are currently in the hole about 50Billion.
They have 200-300 billion in Alt-A mortages that are now starting to go bad.
They have been delaying forclosing on homes by making the money owed a 2nd loan.
Sebastian or O-Joe could I please get the bull-spin on the positive effects on US GDP/CPI/USD/Unemployment-rate etc.. on this news?
Rat meat in demand as inflation bites
Rat meat in demand as inflation bites
| Reuters
Formosa would be wise to yield proactively.
Mel | 08.28.08 - 8:45 pm | #
They are.
More important, with unquestionable spending power, the mainland strategy is much more subtle, and patient, these days.
But the longstanding habits of the godfather protection racket continue for now.
pls see:
Asia Times Online :: China News, China Business News, Taiwan and Hong Kong
News and Business.
jim writes:
So,what are they buying instead?
jim | 08.28.08 - 8:09 pm | #
I agree that's the question... here's a discussion from Setser from a few days ago...
Here
And the resulting flow has been huge and until recently, it was getting bigger. It now seems to have come to something close to a stop. Unless it restarts quickly, I suspect the US government will have to make its role in the process explicit.
In the short-run, the US needs this directed credit program to continue. Demand for non-Agency MBS has disappeared. And if credit isnt available to buy homes, home prices will fall further, faster adding to the distress of the US financial sector.
In the long-run, though, the US probably shouldnt continue to favor investment in housing over investment in other sectors (to be precise, the US supports borrowing to buy homes, and thus indirectly supports the housing sector) to quite the degree it does now. The United States skill at turning mortgages into foreign exchange reserves interacted with Chinas desire to avoid renminbi appreciation to produce an unhealthy economic cocktail.
Yup. Coming to an end it appears.
someone is buying.
U.S. 30-year mortgage rates fall in latest week
U.S. 30-year mortgage rates fall in latest week
| Reuters
The US buys its own bonds with offshore accounts in the Cayman Islands. Think I'm nuts? This purchasing has gone from the single digit billions in the 1990s to something like 130 billion/year. You think Jamaicans are buying our debt? you think millionaires are hiding their money buying our bonds through offshore accounts? No way...they are trying to get their money OUT of US assets. The govt adds a 1 and a bunch of zeros into a computer and uses this "money" to buy its own bonds. Thats how you get 12% inflation without having to overtly "print". You'll see it soon. When inflation keeps getting worse and worse. You'll hurt when gas peaks in June 09' and then again in June 10' and then again in June 11. Peace
Sure, Jamaicans are loaded.
Sure, Jamaicans are loaded.
I saw a few of them have recently got glod!
Here dryfly...
"What could go wrong,he says"
El Cliffo writes:
Sure, Jamaicans are loaded.
Or at least stoned
Now that the Chinese are pulling out ( with other countries sure to follow ) more and more middle class Americans will now be more deeply subjected to the massive ponzi financial scheme needed to perpetuate the increasingly fake bullshit US economy.
ac:
Thanks for the hat tip on declining squirrel populations.
Still prefer pancakes, though.
Squirrel pancakes?
Cartoon thread up ahead --->
Anonymous Bosch writes:
Here dryfly...
"What could go wrong,he says"
Anonymous Bosch | 08.28.08 - 9:16 pm | #
LOL!! Had to copy & save that picture - use it on a powerpoint someday...
Mo
Don't you think the drug cartels have the equivalent of a SWF? And surely the cartels use the Caymans for banking. Hey its right on the flyway for their airplanes on the return trip.
Seems to me that the Cartels share many economic motives with China. So perhaps there is similar behavior.
George W. would seem a natural to negotiate with the Cartels.
OT: Boston, MAResearchers from Boston University's Slone Epidemiology Center have found that in a given week, over 10 million Americans are taking opioids, and more than 4 million are taking them regularly (at least five days per week, for at least four weeks). These findings appear in the August 31 issue of the journal Pain.
...The prevalence of regular opioid use increased over time and was highest in the South Central region of the country. Among regular users, almost half had been taking opioids for two or more years and nearly one-fifth had been taking opioids for five years or longer.
\t
And according to nida.nih
According to the 2003 National Survey on Drug Use and Health, which may actually underestimate illicit opiate (heroin) use, an estimated 3.7 million people had used heroin at some time in their lives, and over 119,000 of them reported using it within the month preceding the survey. An estimated 314,000 Americans used heroin in the past year,
Just where is our opiate addiction problem?
dryfly writes: LOL!! Had to copy & save that picture - use it on a powerpoint someday..
The site's become an addiction.
The site's become an addiction.
Anonymous Bosch | 08.28.08 - 9:38 pm | #
I check it from time to time too - but THAT one is hilarious... speaks to my life. I mean what could possibly go wrong? LOL!
"The US buys its own bonds with offshore accounts in the Cayman Islands"
You do realize that many hedge funds are based in the Cayman Islands don't you?
Jeez and I thought I was paranoid. You get the super-duper tin-foil double-strength collander award!
Speaking of Caymans - anyone watching Gustav? I don't think they're going to get hit to hard but after that its setting up to be a real problem IF it follows anything close to the models...
On Cayman Brac, in Gustav's path:
I got this report last night from wunderground user mangroveman, who lives on Cayman Brac: The general feeling here is to be prepared and wait and see. Public Works has gotten most of the shutters in place on schools and other public buildings. They will finish up in the morning. Hurricane shelters are ready including the new Humane Society shelter for pets. The shelters are almost all on the Bluff, the limestone spine of the Brac which rises to 140 feet on the east end of the island and gives the Brac its name, and so are well out of the way of any storm surge.
Since Hurricane Ivan virtually destroyed Grand Cayman in 2004, many folks from there (as well as Brackers) have built themselves hurricane cottages on the Bluff, also well out of the way of any storm surge. I would say that about half the h omes here have their shutters up, and the rest should all be up -- or ready to go depending on the storm's strength -- by noon tomorrow.
Cayman Airways has added several jet flights between the islands--we are usually served by Twin Otters from Grand Cayman--for people who wish to get out of here--or there!
Business at the grocery and hardware stores has been steady, with the usual stocking up of supples. A lot of people went through this exercise not so long ago with Fay, and so most folks already have plenty of supplies.
The biggest concern here about the nature of the storm is that it has slowed down to a crawl, and, experience tells us that the slower it moves, the stronger it can become. However, general feeling is that Gustav is disorganized and will need to really pick up strength quickly if it is going to be a major hurricane that would threaten the Brac. One of the historic memory points on the island is 1932 when the Brac was whacked by a mega-storm which not only destroyed the island and killed 110 people, but also caused many families to leave. The '32 Storm has become a living legend, and most any hurricane that hits the Brac is compared to that storm. Most people feel Gustav will not measure up against the '32 monster. Which is a good thing, of course!
Jeff Master's Wunder Blog
Mp
in reality the indians kept their word far often than did the us government
paulson would be better described as a white man giver
and i say that as a fat bald white guy
Tropical Storm HANNA
is tracking even further north than GUSTAV along the Leeward Islands
Are credit default swaps which pay various amounts depending on the the Fannie or Freddie to treasury credit spread?
"someone is buying."
No shit? Someone had to or they couldn't have sold ever think of that?
a fat bald white guy
Those are the wrose kind I hear you can't trust any of them.
Look! Someone is buying.
WASHINGTON (AP) -- Shares of Fannie Mae and Freddie Mac soared Monday in a respite from their battering in recent days, while some regional banks saw their stocks sink on worries they could be swept up in the turmoil surrounding the mortgage finance giants.
Freddie completed a $2 billion debt sale, and a Wall Street analyst said a government bailout of the mortgage finance giants may not be inevitable.
But a few regional banks with significant holdings in Fannie and Freddie preferred stocks followed the rest of the market down amid questions over whether federal regulators would step in to rescue the two government-sponsored companies.
Shares of Freddie jumped 48 cents, or 17.1 percent, to $3.29 Monday, while Fannie climbed 19 cents, or 3.8 percent, to $5.19.
Anonymous Bosch writes:
Tropical Storm HANNA is tracking even further north than GUSTAV along the Leeward Islands
Anonymous Bosch | 08.28.08 - 10:04 pm | #
Master's discusses that one too - models predict it is likely to cross over the northern part of the Bahamas then slam into SE US coast - possibly not far from where Lawyer Liz is [though most likely north of that and it could still recurve out to sea as it is expected to slow down].
Regardless we could have two major hurricanes hitting the SE US within days of each other.
Where is Brownie when you need him [they'll have to find another scapegoat and FAST]...
Brownie is out inspecting horse testicles.
No wonder he looks like a walking cadaver.
The Law of Unintended Consequences
OT
Georgian war was US plot, says Putin.
AdelaideNow... Georgian war was US plot, says Putin
Them Neocons, be prepared for another fake 911 before this election is over.
"And if credit isnt available to buy homes, home prices will fall further, faster adding to the distress of the US financial sector."
Gee, that makes it sound like the whole thing was based on easy money. Wow, could the Austrians be correct?
All bond spreads are wider relative to Treasuries. You should look relative to LIBOR (swaps). Then you'll see that GSE debt spreads have held in pretty well.
OT, but Obama stating that as president, will support American auto industry to produce high eff, alternative fuel autos.
Go long F and GM.
Chrysler, not so much.
Mayberry Machiavelli is a satirically pejorative phrase coined by John J. DiIulio Jr., Ph.D., a former staffer of the George W. Bush presidential administration who ran Bush's Faithbased Initiative. After he quickly resigned from his White House post in late 2001, DiIulio told journalist Ron Suskind, describing that administration, as published in Esquire magazine: "What you've got is everything--and I mean everything--being run by the political arm. It's the reign of the Mayberry Machiavellis."
The phrase is meant to invoke infamous Machiavellian style power politics coupled with a prejudicial sense of regional backwardness and incompetence in the American south as supposedly exemplified by the fictional, small, rural, North Carolina town of Mayberry R.F.D., from The Andy Griffith Show which ran on the American television network, CBS, from 1960 - 1968.
The phrase, seeming so felicitously apt, was picked up and virally repeated by many critics of the George W. Bush presidency.
Where ever Brownie is, he's likely doing a helluva job.
a.c.,
Regarding your OT topic on the absurd-looking 3.3% real GDP growth rate for the second quarter, here is a comment I posted on Economist's View.
"Much of the growth attributed to net exports is a statistical quirk, and the hacks at the Commerce Dept should have pointed this out instead of glorifying it.
See for yourself in the NIPA tables:
BEA National Economic Accounts
Table 1.1.2 claims that Net Exports of Goods and Services added 3.1 points to real GDP (out of a 3.3 total). WOW!!
However, if you look at the actual current-dollar numbers, (Table 1.1.5) net exports of goods and services actually WORSENED from a $706 billion deficit to a $710 billion deficit.
There are several causes of this quirk, but the main one is that "real" imports are measured in 2000 prices rather than the prices we actually paid in 2008. Oil prices are the major culprit.
This has happened before, especially when oil prices surged."
Oh my God, China stopped buying agency paper and the dollar didn't plunge to minus infinity! How could that be?
I sure hope we don't get much more rain. The Indian River is still rising in some areas. As I posted before we are on an 8-10 inch hill AND we bought flood insurance. A neighbor's yard is still full of water. If Hannah dumps as much water as Fay did (unlikely, Fay was extraordinarily wet), we will flood here.
We were totalled in hurricane Andrew. Once in a lifetime is enough for that experience.
The acquifer is recharging only a little bit, according to a weather maven who works with the hub.
Oh my God, China stopped buying agency paper and the dollar didn't plunge to minus infinity! How could that be?
Wait until the most recent TIC data comes out. They are buying something or just rat holing the cash until they buy else the RMB goes to the moon vis a vis the dollar - supply demand - you don't run those kinds of surpluses & hold stable exchange rates without ONE of those things happening. It's probably treasury paper being bought now more than agency... from Setser:
Over the last year (think the period after the subprime crisis), central bank holdings of Agencies and Treasuries have increased by $419.5 billion with a clear shift toward Treasuries recently after a long period where Agency holdings were growing faster than Treasuries. This quiet bailout far exceeds the roughly $35 billion that sovereign funds have invested in US banks. The US TIC captured most of these investments, and its shows $34.2 in official purchases of US equities over the last 12ms, with almost all the increase coming right after the big recapitalizations. The total would be higher if UBS and Barclays are added in but also remember that many central banks dont use the New York Feds facilities, and some rely on outside managers for even a Treasury and Agency portfolio. Central banks likely added more than $420 billion to their total holdings of Treasuries and Agencies over the last year.*
$420 billion isn't chump change & that's JUST the central banks.
Invisible-However, if you look at the actual current-dollar numbers, (Table 1.1.5) net exports of goods and services actually WORSENED from a $706 billion deficit to a $710 billion deficit.
i don't think you've interpreted that right. you expect exports to be negative numbers and they actually increased from 706 to 710 as per the headline.
Worker Assets Shrink at Fannie and Freddie
"...workers had $116 million in the employee stock ownership plan at the end of 2006. Today, its more like $17.5 million. Ouch."
Coming Home to Roost - NY Times
$420 billion isn't chump change & that's JUST the central banks.
Thanks for that Dry. Don't get to Setser as often as I should.
So what happens when Treasuries become agencies?
Lawyerliz - do you really consider 8 to 10 inches a hill????
Somehow, Paulson wants to move all that money directed to the GSE's over to the Treasury market as he so desperately needs the cash over there....
Don't worry, the talking heads on CNBC told me that the recession was over and the recovery is well at hand, we don't need the Chinese anymore. Thanks for helping out, though.
But, but, but - the Chinese have too much saved, they are gluttons for saving. Without us, they wouldn't have anywhere to put their savings.
Why could they possibly want to sell any of their savings?
Why? Why? Why?
Hmm - maybe the Chinese aren't the co-dependents we assumed they are.
What a bunch of total bullshit here:
As the political spotlight shifts to the upcoming Republican convention in Minneapolis-St. Paul, GOP leaders are closely monitoring the movements of Tropical Storm Gustav, which is approaching hurricane strength as it heads toward the Gulf Coast.
Party officials are discussing the possibility of postponing convention proceedings if the threat to New Orleans and other Gulf Coast areas grows. If there is serious damage in the Gulf Coast, images of Republicans partying in Minneapolis-St. Paul could be an embarrassing reminder of the Bush administration's delayed response to Hurricane Katrina three years ago.
The Republican bastards lie about GDP to pump the stock market and now they pander to voters as if they give a shit about post Katrina reality!
Dryfly, IMHO what we really need to worry about is when they start to loose faith in Treasuries. Then you know BWII is done with and the dollar is toast.
What worries me most is this Fannie/Freddy debacle has put the specter of what happens in an American default in the forefront of most SWF/FCB managers thoughts. They may not have been tasked with making a profit from these currency peg "investments" (their increased domestic GDP/export business was the payoff) but they sure the heck weren't supposed to lose the investment either. It's about to get interesting, the Fed may have to soon choose between protecting the dollar/funding the twin deficits when the CBs finally balk and maintaining the economy by letting the dollar tank.
The Chinese want to be "adequately compensated", as Yu Yongding has been quoted. I believe that their dollars could just as well buy American corn, soybeans, beef, and what's left of our income producing industry as treasury paper. I don't think they'll be interested much in our investment banks although leeches actually do have some medicinal value.
Lots of central bankers are cutting on agencies, they'll end up bying only T-bonds
The problem is the TReasury market simply can't break or game over. So the strategy is to kleep that window opne and hoppe the market cures itself and in time the agency window reopens. by that time will be well north of 100 trillion all in with contingencies. Likley due north of $13 Trillion outright...that compares to dwindling tax receipts of sub 3. So bascially we are effectivily bankrupt. Withut a restructuring a la latin america no chance of recovery. Obama investing in hybrid technology four letters J O K E
chophouse
In some places 10 inches is a hill. The highest point in Florida is ....
345 feet above sea level.
So if 345 feet in Florida is 345, then 10 feet is a good size hill.
Florida - Wikipedia, the free encyclopedia
It's also normal to cut a bit because
central bankers have injected around
$400b in agencies and T-bonds during the past 6 months.
They are no fool if it's useless they'll stop
So everyone shifted their purchases from agencies to treasuries at the same time that the gubment started issuing more treasuries to buy more agencies?
How long before it becomes clear that this entire country is a money furnace?
My guess is 6 months or less.
The theme of the next decade? The Greater Depression.
Idoc,
If you look at GDP Table 1.1.5 on the BEA website you'll see what I mean.
Net Exports are Exports minus Imports, and is a measure of the trade deficit. In the 2008:2 quarter, gross exports were $1927.6 billion while gross imports were $2637.6 billion, resulting in Net Exports of NEGATIVE $710.0 billion.
Net Exports in CURRENT DOLLARS went from -705.7 billion to -710.0 billion, which is a worsening of the trade defifit. Because of the quirks in the way REAL Net Exports is calculated, this current dollar worsening became a huge INCREASE in real GDP.
How long before it becomes clear that this entire country is a money furnace?
LOL - winter's not far off & considering fuel oil prices... burning money might not be a bad use for the stuff.