Hard to believe we are following the Pakistan market model with these protected shorts. Hard to believe Pakistan just fired on our helicopters that flew over their airspace today.
Note that the new order provides a (limited) exemption for options market makers.
Interactive Broker's implementation is that you can still buy puts, but you cannot sell naked (non-covered) calls. So you cannot create a synthetic short, although you can still just buy the puts.
$1,800,000: Amount Sen. John McCains (R-AZ) campaign manager Rick Davis was paid as president of a lobbying company founded to defend Fannie Mae and Freddie Mac from stricter regulations, over five years.
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
the most import thing going unsaid here is that every damn thing that Paulson has proposed so far has failed to correct the situation, or even slow it down.
Why on earth would we just trust him that this will be his one idea that works?
Think Asia in 1997 and Russia in 1998. Negative real interest rates, followed by massive increases in share and property market prices, followed by crash and credit crunch, followed by capital flight and devaluation of currencies.
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
Don't kid yourself for one second, energy: they know this just as well as you or I.
They are just throwing the kitchen sink at the problem while hoping against hope that the "far worse crash" holds off until after late January '09 ... so Obama can be painted in broad strokes with the Hoover brush.
I don't think they're going to succeed, but they're putting up a hell of an effort.
Just got off the phone with my CongressCritter's office. I explained to them I thought it was A Bad Thing that taxpayers could bail out companies, while the officers that looted them got away with it. I went on to explain that while I understood the need for liquidity in the financial system, we could do better than the proposed bailout.
According to the nice CongressCritter staff person who took my phone call, many others were doing the same. The interesting thing, as this individual put it to me, was that these calls were coming in UNSOLICITED -- that is, others were reaching the same independent conclusion CR and others have reached.
'Twill be interesting to see how this one works out. Best to all.
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
Ain't that the truth now. No one wants to play in a rigged game.
Dufus- here are my points, which I was happy to see that Krugman picked up on many of them a day later.
First, we have no reason to be assured that this will work, and the track record of the legislation's authors does not inspire confidence. Enormous sums of money have already been thrown haphazardly at this problem, only to leave the credit markets still near the freezing point.
Second, we had three years to debate alternatives if this day ever came, and instead of sitting with Congress to come up with contingency plans, we were told that everything was fine, even as it fell apart.
Third, when we can clearly see that an anti-regulation ideology got us to this place - how can we pass a bill that does nothing to address the issues that caused the financial crisis in the first place?
Fourth, how can we propose to directly bail out those people that benefited the MOST from the housing and credit bubbles, with no stipulations in the bill that they will ever be brought to account for their irresponsibility, greed, and at times, criminality?
Fifth, we are about to throw essentially a blank check to the Treasury, on the assurance that taxpayers will be protected, when all evidence points to taxpayers taking the largest hit, and receiving the least benefit. The $700 bil. price tag is not a total figure, just a temporary limit for holdings at any one time. The ultimate price tag is unknowable; we only know who will be on the hook for it.
One of my Senators is on cnbc telling us we need to act quickly to push this bailout through...I guess my emails didn't help...Martinez is such a tool
"Give us unlimited powers over the financial system or you'll all die. Honest, we're not just trying to take the economy hostage so we can rob taxpayers at will. This isn't a hold up or anything like that. Have you ever seen a mugger with a smile like this?"
There are far worse things than a depression.
Looks like we might have to learn this the hard way.
Did he just say "In order for it to do what it needs to do it needs to be big enough to do what it needs to do."?!?! Mr. Martinez you are a giant douchenozzle.
ProShares Announcement on SKF and SEF - Sep 22, 2008
Due to the emergency action announced by the Securities and Exchange Commission on September 18, 2008, temporarily prohibiting short sales of shares of certain financial companies, Short Financials ProShares (SEF) and UltraShort Financials ProShares (SKF) are not expected to accept orders from Authorized Participants to create shares until further notice. Unless notified otherwise, shares will be available for redemption by Authorized Participants as normal. The shares of these ProShares are expected to trade in the financial markets. As disclosed in the prospectus, ProShares may at times trade at prices that are not in line with their intraday indicative values.
Sep 22, 2008
Yeah, Florida is just the coolest...Lucky me, Mom died and left me a mortgage that I can't get out of because property values have dropped so stay I must.
Short the dollar
Short treasuries
long commodities
Sell all US stocks and bonds
Cut up credit cards
Pull money out of bank
Join underground economy
start underground bank
Scew'em
Does banning short selling have any long-term impact on share price? Eventually you have to buy back short shares and close the position. Doesn't the ability to short just mean more buyers and sellers and thus lower bid/ask spread?
Wouldn't a company that opted out likely get sued by shareholders?
I mean, banning short selling "protects" the share price, at least in the short term, so it seems like they'd have a hard time arguing that this would fall under "fiduciary responsibility".
What's most strange is that the people at the helm of this shipwreck are now tasked to to build the new raft. Didn't Bernanke say that the housing crisis was contained? Why is he being asked for leadership?
Does banning short selling have any long-term impact on share price? Eventually you have to buy back short shares and close the position. Doesn't the ability to short just mean more buyers and sellers and thus lower bid/ask spread?
Of course it does.
All of these plans are too crazy to be proposed by sane people. Unless they think the "underlying problem" is the risk of a panic...
Maybe all of these moves have nothing to do with fixing the real problems and everything to do with manipulating public sentiment. Wonder if it'll work.
My skf was frozen for a while and then I was able to sell it on Friday. Then I find it back in my account.
Sale reversed because of a rule saying you aren't allowed to sell it for a price that is 20% or more up/down from the previous days close. And now they are just holding my sell order and not letting me sell it.
luckily it was just a small amount I bought Friday morning at open.
allan greenspend...i think you should update your name to all-in green-spend. that guy....id like to pitch and fork him....no wonder paulson wants immunity up front.
Wouldn't a company that opted out likely get sued by shareholders?
Well, either they might get sued for an attempt to artificially prop up the price, or they might get sued for not asking to get on the list, and therefore allowing the price to be driven down. Hobson's choice.
For those angry enough to act: contacting your member of congress is good -- contacting your state/local officials can be useful as well -(see search box in upper left to find all of your elected officials):
If you call their offices, all these officials have staff dedicated to taking complaints/solving problems -- if they get inundated with calls, they are going to do something -even if it is simply informing your officials that the public is outraged.
one of the BEST things you can do is contact your local media - TV station /radio/ and newspaper - and register complaints, and ask why they aren't knocking at elected officials' doors and covering this more. They get enough complaints, it's a story.
Get a few folks together in your neighborhood, church group, whatever - even if it's just your family, and organize a protest, or pass out flyers in front of a bank (yes it's small potatoes, but press are much more likely to cover if there's some kind of visual/audio element they can whip up for their newspaper-website pages or the TV news.) The more visual, the better (can you rent pig costumes - or at least buy those pig noses at a Halloween store?).
National media contacts: (I recommend calling - ask for the newsroom / news assignment desk/ managing editor of news to try to get through)
A two-page, trillion-dollar proposal that transfers wealth from taxpayers to a Wall Street class that is least sympathetic to them to pass within a week. Am I close?
Has anyone but me noticed that the absolute secrecy surrounding all the Paulson purchases has the effect of preventing "mark to market" on other similar assets? Only he and his associates (cronies) will know what assets are being offered at what prices. Sweet! All the banks will be offering their assets without the slightest idea of what was a winning offer from others in the past. This is the ultimate closed bid auction.
I'm not savvy enough to figure out the implications of all this but it seems important.
How can confidence in the markets be restored without transparency? At some point the players have to be able to look at the assets of an institution and feel comfortable with their valuation before they will risk capital for a bond or equity position.
Something wicked this way comes. This is really a mess.
asl,
The truth is, there's no way to estimate the losses from the paper. One thing is for sure; the current holders are scrambling to figure out which contain the most toxic waste so they can unload those first.
good point thoth, I had a pollyanna on another forum telling me that GAAP and mark to market would insure that taxpayers actually make money on this bailout...I almost choked...
Has anyone but me noticed that the absolute secrecy surrounding all the Paulson purchases has the effect of preventing "mark to market" on other similar assets?
Looks good, but you left out Section 8 that prevents judicial or agency review.
"The financial system bailout plan, which could end up by costing Washington around $1.8 trillion, may increase the risk of stagflation and will probably cause problems for hedge funds and smaller banks, Mohamed El-Erian, co-CEO of bond giant Pimco, told CNBC on Monday."
pitchesNforks writes:
allan greenspend...i think you should update your name to all-in green-spend. that guy....id like to pitch and fork him....no wonder paulson wants immunity up front.
~~~~~~~~
had the moniker since '04 when folks didn't see his true evil self. i got other AKA's, but still feel a fondness for this one in my macroeconomic world.
Hedge funds are not protected. Does this mean that they feel hedgies are pushing the markets lower or does it mean the hedgies are to stop shorting entirely. I know most of the hedgies are WAY short EVERYTHING. Guess lazzie fare market capitalisim does not work in the new Socialist Republic of America.
The mass hysteria is now evidenced by J6P.
The market drop and the gold rise, now 890 range, up $15 on the day, and the drop in the USD, are the symptoms.
The only thing to fear is fear itself.
I dunno what that means, but we'll be hearing it.
The solution is simple. Restore confidence. The American people still believe in the value of the Dollar. Offer MASSIVE FDIC INSURANCE for bank deposits. Do it now.
Instead of fleeing, the American public will trust the government to protect them.
Insure deposits to $1 million or $5 million or whatever. Enough for the public to believe in the insurance.
If you, government, do not do this immediately, the fear will grow and the economy will see credit unavailable. That's economic suffocation.
Maybe all of these moves have nothing to do with fixing the real problems and everything to do with manipulating public sentiment. Wonder if it'll work."
When is the last time curfew laws have inspired a sense of security?
A tested equilibrium is a requirement for a sense of security. It cannot be imposed by force.
I interpret the short sale rules to mean that ""people"" have to unload their financial shares "in relative peace"
Please take note of the plethora of stock buy back announcements out this morning (MSFT, HP, Nike). Either all these firms came to the same conclusion Sunday night, or Someone like the Emperor Paulson had set this up to restore confidence in our fundamentally sound and strong economy that needs saving withing the next 2 days or something.
"The President, Vice President and all civil Officers of the United States, shall be removed from Office on Impeachment for, and Conviction of, Treason, Bribery, or other high Crimes and Misdemeanors."
"Sept. 22 (Bloomberg) -- U.S. stocks dropped for the first time in three days as a slide in regional banks overshadowed more than $53 billion in share buybacks and the government's expanded bailout of the financial system.
Regions Financial Corp., Alabama's biggest bank, tumbled 19 percent and Marshall & Ilsley Corp., Wisconsin's largest, dropped 18 percent after analysts advised clients to sell regional banks."
$700 billion dumped in, and the markets head lower. Am I the only one who is freaking the F out?
Apart from GS and MS losing their franchise to print money without regulation, I think any downward moves this week should be taken with a grain of salt. Let's face it, every bank in the system -- and apparently GM as well -- has an incentive to make it look like we won't last the week to get a deal done on the most favorable terms.
This is what they call painting the tape.
On a different note, why are treasuries up in the face of massive issuance requirements? Why isn't the dollar down a lot more?
To mp's suggestion that we try for some survival strategies to avoid being roadkill, this blog from an Argentine who lived thru the meltdown there might be instructive/helpful.
Relax everybody, Sebastian says this is part of the natural business cycle. Lost jobs here, rebuilding there. Building boom, housing bust. Huge profit taking, massive bailout. Just look at last quarters GDP and you'll see that everything is ok.
Have they said we are in a recession yet? How can they say 911 today when they say the economy is sound. Criminals. I just watched on CNBC were a couple of analyst called this a Christmas tree.
SEC bans shorting McDonald's stock. {MCD}. If McDonald's stock falls the company will have trouble selling debt.It might go out of business. The whole economy will suffer and there will be a shortage of greaseburgers and healthy fries There will be less competition for other fast food companies. Prices of fast foods will go up. People will stop spending on other things. The whole economy will face a systemic risk. This short selling ban is indefinite and may be extended to other fast food companies to stop a fall in their stock prices. By Order, signed, Kristofer Kocksteiger,[ Herr Fuhrer}
The comments to this article are blatantly anti-semitic--history can be repeated if ignored. There is a political and economic reason (oil) to expect this type of reaction. Shit.
The headline of today's Krugman column was the most politically effective part: CASH FOR TRASH. You don't even have to read any more (and some members of Congress won't). They all read Krugman, and that will leave a mark. The idea is simple enough for a bumper sticker: NO CASH FOR TRASH.
Also devastating was Krugman's line, "Hes making it up as he goes along," referring to Paulson.
REDMOND, Wash. (AP) -- Software giant Microsoft Corp. said Monday its board approved a plan to buy back up to another $40 billion of its shares.
The program expires on Sept. 30, 2013. As of July 28, Redmond, Wash.-based Microsoft had about 9.13 billion shares outstanding, according to a regulatory filing.
The comments to this article are blatantly anti-semitic--history can be repeated if ignored. There is a political and economic reason (oil) to expect this type of reaction.
All my friends and neighbors are safe. This is an evil brought by greed - perhaps avarice. We are all citizens now.
Guess lazzie fare market capitalisim does not work in the new Socialist Republic of America.
The process of abandoning of free markets began after the 1987 stock market crash and basically the free market era came to an end in 1998 with the Greenspan Put and the LTCM bailout.
We're witnessing the consequences of a decade of government control over markets now.
Seriously, General Motors? My God, the ban on short-selling is soon going to be universal, isn't it? Then what's next? A ban on selling out of a long position?
We may be soon upon the time to abandon paper assets completely.
Good read--a two-page dissection of the Paulson Plan from a guy at U Chicago. Final sentence: "The time has come to save capitalism from the capitalists."
So lemme guess... after reading the comments, economist's views, news blurbs, we are in a Catch-22. Damned if bailout the fat cats, damned if we don't? Kinda like the choice between the blue pill or the red pill.
We are at the mercy of the honesty and integrity of our elected officials...... I'm not hoping for a lot. Some small gesture would be greatly appreciated.
I'm staying with mp's suggestion of alternative strategies. Some people here may be able to get dual citizenship to the EU...Ireland, Greece and others will grant it if your grandparents were born there. Gives you working/living rights in all EU countires. Could also make it easier to move your money around. Won't work for everybody, could help some. Supreme Court ruled dual citizenship legal.
It is really amazing to watch this stream of high government officials saying that this problem just sort of snuck up on them. Do any of these people read? How about just a short ride on this blog. We are doomed!
Ladies and Gentlemen, settle down. They know banning shorting doesn't work. They're just trying to limit volatility short term. I agree volatility is really only good for insiders and the lucky, or the manipulators. So although I have been mainly short financials for a while, I've lost my stomach for it. I now agree that the ban may help a little, even if it's only a bandaid. And there's plenty of liquidity in the stock market, that's for sure.
'Up to 10,000 staff at the New York office of the bankrupt investment bank Lehman Brothers will share a bonus pool set aside for them that is worth $2.5bn (£1.4bn), Barclays Bank, which is buying the business, confirmed last night.
The revelation sparked fury among the workers' former colleagues, Lehman's 5,000 staff based in London, who currently have no idea how long they will go on receiving even their basic salaries, let alone any bonus payments. It also prompted a renewed backlash over the compensation culture in global finance, with critics claiming that many bankers receive pay and rewards that bore no relation to the job they had done.
A spokesman for Barclays said the $2.5bn bonus pool in New York had been set aside before Lehman Brothers filed for chapter 11 bankruptcy in the United States a week ago. Barclays has agreed that the fund should continue to be ring-fenced now it has taken control of Lehman's US business, a deal agreed by American bankruptcy courts over the weekend.
Barclays is paying $1.75bn for the US operation of Lehman and is keen to retain its best staff. It said it had made no promises to individual staff members about how much they will receive but that the bonus fund would be paid out. In addition to the $2.5bn cash pool, Barclays is also in negotiations with about 30 executives it considers to be Lehman's best assets and plans to offer them contracts worth tens of millions of dollars. British employees of Lehman described the bonus payments as a "scandal" as they waited anxiously yesterday to see whether a deal could be struck with buyers circling the bank's European operations.
Many of Lehman's UK staff are particularly angry about the US payouts because it has emerged that in the days running up to the bankruptcy, some $8bn in cash was transferred out of the account of the bank's European business into accounts at the New York head office.
There is no suggestion any of this cash was used to supplement the bonus fund, but partly as a result of the transfers, PricewaterhouseCoopers (PWC), the administrator to the European business, initially found it impossible to guarantee salaries would be paid. The September wages of thousands of European staff were only secured in the middle of last week, when PWC negotiated a £100m loan to fund the payments. PWC wrote to Lehman Brothers' head office in New York last week, requesting the repayment of the $8bn, but a spokesman said yesterday that the administrator had received no formal response."
Upthread I mentioned anti-semetic commentary from this article--http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/21/ccliam121.xml&page=1
I guess many here discount its meaning--If all wars are economic, isn't all bigotry also economic? This is a very dangerous time--socially as well as economically--and I'm old enough to have talked to survivors of the holocaust. One cousin still waxed over how lovely life was in Vienna until his father was carted away.
Just heard on the radio that the Bundesbank - oops, I meant the ECB - will not be participating in the Great Bailout. Which places the ECB in fine company, because no other nation than the U.S. seems to be believe that the Great Bailout is a great idea.
Actually, the tone of the news, as far as it goes, could almost be called smirking - as if anyone is going to be dumb to
a. Write a blank check to Wall Street and friends
b. Doing anything that helps George Bush, his cronies, and his political party in any way, shape or form
But then, considering how that bazooka works, it looks like any bank with a significant presence in the U.S. can call on the American taxpayer. Which shows how really stupid the people running the U.S. are - they will be bailing out the same people who caused the problem, and not just Americans - the entire world is invited to just charge it.
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?
Just sayin'. There is probably much more to this plan than they can talk about. I'm guessing MS and GS are making their 'banking' moves now in order to pick up banks on-sale from the gov't later.
"The time has come to save capitalism from the capitalists."
as strange (naive) as it may seem, I do not believe that Paulson ever intended to buy bank assets above book value
but the news of the "plan" has to be capitalized on in order to boost-hold the markets ... for now.
I never thought I'd be saying this, but this "Persons of Indian Origin" card makes me feel a little better now. If things really turn to shit, at least I can find my way to Bombay and ride things out with 200 family members.
Mel writes:
Upthread I mentioned anti-semetic commentary
I guess many here discount its meaning--
Mel,
We are all in the same boat now. There will always be folks on the fringe. "They" may be out to get you, but I'm not. We are in this boat together. My suggestion is that we work on rowing in unison.
kis writes:
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?"
kis writes:
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?
Yes, see SEC order to ban shorting on financial stocks...
That's been around since at least 2000. We were in New Zealand at that time and someone got wind of the system's existence and started asking around. It was quite funny because while the U.S. was stoutly saying, "There is no such system," the Kiwi's were blithely saying, "Oh, yeah, we provide a hookup point and closet for Eschelon so the u.s. can record the overseas phone calls routed this way." What amazed me was the lack of outrage all around.
After 9/11 the u.s. released some transcripts of phone calls that had happened months before that were not considered suspicious previously, basically tacit admission of the system's existence. Ostensibly, the system only records international to international calls. And if you believe that they limit it to that with zero oversight, you deserve to lose your rights.
The shrub was frantically trying to get privatizing SS slammed down our throats. Was the solvency of the entire financial system and government obvious then, I wonder ?
Here is my letter. Probably not to the taste of most people here.
Dear Senator Sanders, Senator Leahy, and Representative Welch,
\tI am writing today to urge you to oppose the ridiculous financial bailout bill proposed by the Bush Administration and Secretary of the Treasury (and former Goldman Sachs CEO) Hank Paulson. It is easily the most naked power grab in the past quarter century, and if passed as-is, it will go down as the Bush Administration's third biggest screw-up (After Iraq/Afghanistan and Katrina). The plan is undemocratic, unaccountable, and fundamentally unwise. The rush to get it passed is a scare tactic aimed at bullying Congress into passing something that favors Wall Street. We saw something similar before the Iraq war, and we know how that turned out.
\tThe plan as currently proposed almost certainly won't work. Buying the various CDOs, MBSs, and other financial instruments at market value would still leave many banks under-capitalized and thus insolvent. But buying the financial instruments at face value would be a huge give-away to Wall Street and other financial gamblers. The only way to avoid a huge giveaway, eliminate the moral hazard, and keep the system functioning is to take over every institution with a whiff insolvency, recapitalize them directly, and manage them until the financial instruments mature and the firms are solvent. It would be ugly, but the American financial system is broken. But so is the idea that unfettered free market capitalism exists in American, or that they work. That has been proven false by very people who most support it Republicans and Wall Street.
\tHere are the conditions that I think should be attached to any bill, no matter the details of how the bailout is implemented:
It should have include a way of at least partially paying for the huge bill the taxpayers will inevitably shoulder. I suggest a) repealing the Bush tax cuts, b) resetting the capital gains tax to the pre-1997 levels, and c) implementing a low (0.01% to 0.05%) transaction tax on all stock, bond, option, future, etc. sales (the UK already has a sales tax on stocks and it hasn't harmed the London stock market).
It should have a provision to break up anything that is too big to fail.
It should include a provision to regulate anything that functions like a bank as a bank.
It should be completely transparent and have accountability. All transactions should be posted on the web immediately. Congress should get weekly reports on what has happened, why, and what the next week's plan is.
\tTalk about limiting CEO compensation may feel good, but is basically irrelevant at this point, as is talk about claw-backs - recovering past unwarranted compensation. Helping homeowners should also be separated as it muddles the issues. The focus needs to be on rebuilding the financial system from the top down with a more small-c conservative culture.
Comrade RayOnTheCollective writes: Yeah, and if you send them snail-mail, the probably scan it and shred the paper.
Whatever you send, keep it simple. The office staff only have a check list of issues and a "pro/con" count. A simple message (i.e., "Bailout: NO!") will be as appreciated as a longwinded and carefully-footnoted argument, which might get accidentally tallied under "worried about economy".
That is the only prayer we have of this thing not flying - Dems press for Main Street relief that the administration will say is a deal killer - cramdowns might just be the ticket...
This reminds me of the Woody Allen movie "Bananas." I'm waiting for King Henry to dictate, " All people that are not 30 are now 30. All people will wear their underwear on the outside of their pants."
Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages.
The scope of the bailout grew over the weekend. As recently as Saturday morning, the Bush administrations proposal called for Treasury to buy residential or commercial mortgages and related securities. By that evening, the proposal was broadened to give Treasury discretion to buy any other financial instrument.
BB writes:
"The market is not fooled by the bailout, neither it's enormity nor it's mechanics."
No, but the market may have been so fooled over the last 9 months by fed open-mouth-policy lying, that it probably has not discounted the impending earnings decline and may be 2000 or so points overvalued.
"I will not wait on events, while dangers gather," Bush told Congress. "I will not stand by, as peril draws closer and closer. The United States of America will not permit the world's most dangerous regimes to threaten us with the world's most destructive weapons." 2002 State of the Union Address
next speech I say:
...The United States of America will not permit the world's most dangerous financial instruments to threaten us with the world's next Great Depression."
Senate Democrats draft calls for Treasury to get “contingent shares” in companies selling assets, establishing of emergency oversight board to monitor bailout pla
Not sure how they'll do it. But this was an attempt to give them cover. The idea being that the "bi-partisan" approach would enable them to not have to bear the brunt of the blame when this goes tits up.
You all sound VERY unpatriotic this morning. As an American, I am glad that we have two talented men giving this their full attention.
This was obviously a total surprise. Secretary Paulson and Chairman Bernanke are doing the best they can to play the cards they were dealt.
I support their efforts.
I'm glad we at least have Fox to give us the facts. (F-You communist CNN)
I support the USA.
I support the President.
And I love Jesus.
Stop talking crap and start loving America you damned traitors.
peAkcredit writes:
No, but the market may have been so fooled over the last 9 months by fed open-mouth-policy lying, that it probably has not discounted the impending earnings decline and may be 2000 or so points overvalued.
Let's see if the markets wake up to this reality sooner or later.
Also a declining dollar means less returns on dollar denominated assets.
Equity prices were set to pop this morning when it became apparent to King Henry Paulson that the Dems were going to force him to kiss the Pope's ring in the form of judicial review. so King Henry responded pretty much in the fashion he ran Goldman Sachs, like a bully. He and his Wall Street friends torpedoed the market, and they will keep doing it to show their power. I said this Bull would roar after the deal is done in Washington; the devil's in the details and Congress doesn't like the details you pointed out here. If Congress approves that aspect of the bill, then these cowards ought to be voted out in November -- every single person who voted in support of putting King Henry above the Judiciary. In fact they should be vting for his impeachment this week.
This is serious stuff. A revolution of sorts is going on. The market will tell us how it's going to go.
I hold to my views that if enough pressure is put to bear on Henry he will either have to accept a compromise (has he ever in his life?) or resign, and then there will be a deal, followed by a monster rally that will be the first up-leg in the 2008-2011 Bull market.
The President and the Republicans will not put up with a market crash here. The Dems have voting control, and a heck of an opponent in Paulson's gang. This will be an interesting couple days. Btw, it's a time to review the recent non-Financial Cara 100 Buy Alerts. In the Financials, I do like Canada's Royal Bank plus Options Express and Interactive Brokers.]
Commercial paper spreads (mentioned above) are predicting meltdown is NOT imminent (as in this week) although they're still predicting a hard time. The spread of 2.88 on 30-day paper predicts a depression, but not a Depression. But 60-day paper is being sold again with a 2.90 spread, so the CP market thinks things will be fairly level for 2 months. 90 day spreads are still out but I think that's just because nobody wants to rollover during the end of year crunch. In any case, the prediction is that we do have at least a few weeks and can think at least a little about how to fix this rather than accepting the first boneheaded plan offered in a screaming panic.
The process of abandoning of free markets began after the 1987 stock market crash and basically the free market era came to an end in 1998 with the Greenspan Put and the LTCM bailout.
We're witnessing the consequences of a decade of government control over markets now.
didn't hear the markets complaining about free money, didn't see them employing it usefully, didn't see them complaining about all the government control, didn't see the republicans setting up all this government control, didn't see them warning of the dangers of going down this path, didn't see diddly.
If Paulson is consistent with actions taken with AIG, Fannie and Freddie, then financial firms will be recapitalized and taxpayers will own 79.9% of each company that wants/needs to participate in the program. Thus, the equity of these companies is worth a lot less than what they are currently trading at. It is helpful to ban short sales to mitigate the ensuing panic. And Paulson can't tip his hand that this is the plan; otherwise there is a crisis before he has authorization to deal with it.
What should really scare everybody is transitioning our government in this time of crisis. This is extraordinary and calls for extraordinary thinking.
We need to postpone the election.
I know people will freak out, but be reasonable. We need Secretary Paulson and President Bush to finish their solution and not just walk away while our balls are in the air. Until they have all our balls in hand, I say NO ELECTION.
Democracy shouldn't mean suicide. No elections until we fix this mess.
Mish posted a nice summary of the problem which is simple to cut and paste and add your comments to for emailing your congressional reps. I did all three of mine just now. Worth a look...
Are you really proposing that Bush has some - I cannot resist the term - Final Solution in mind? And that we should cancel the election to let him implement it? Are you totally mad?
Unless, in Bush's bizarro world, his massive incompetence allows us all to thrive despite Dick Cheney's most sinister plans.
Insurance, broker and bank indices down 5-10% may be early indicators that the corrupt bail out is not stopping the emerging decline in earnings, borrowing, spending or stock values.
Gradually the continuing economic and asset decline will come into focus, as will the specious, corrupt nature of all the various gov't reassurances to the contrary.
I'm here from the citizenry, and I'm here to help.
Canadian Prime Minister Stephen Harper refused on Monday to say whether he supported the U.S. government's $700 billion plan to rescue financial institutions.
Mel writes:
"Upthread I mentioned anti-semetic commentary
I guess many here discount its meaning--"
Mel, I notice the same thing, especially during periods of any sort of upheaval. It does seem to be the fall-back position of certain groups to "blame the Jews." I am always quite disturbed by this, yet I would like to agree with Popeye that these people are the "fringe." I absolutely agree with Popeye's statement that we are all in this boat together.
NOIDA: The Chief Executive Officer of a company was on Monday beaten to death by a group of dismissed employees inside office premises after a meeting called to resolve dispute between them and the management failed. ( Watch )
L K Chaudhury, the CEO of Gradiano in Udyog Vihar of Greater Noida, was killed when the agitating workers turned violent and beat him up, Senior Superintendent of Police (Noida) R K Chaturvedi said.
Cancel the elections, give GWB some more beer and blow, hire back Brownie, and let's declare Mission Accomplished as many times as it takes. The credit crisis is clearly in its last throes and there will be no civil war because their is just no history of class conflict or malfeasance on Wall Street. Oh. And the operation will pay for its own reconstruction.
"How does buying troubled assets help recapitalize the financial institutions unless the Treasury pays a premium for the assets?"
The treasury is acting as market maker in a market with no buyers. By making the market and by acting as buyer of last resort there will be buyers across the entire buying spectrum of failing products.
Surprise, surprise.
Are they going to force current shorts to cover?
wait a minute , GM?
General Motors!!
Hard to believe we are following the Pakistan market model with these protected shorts. Hard to believe Pakistan just fired on our helicopters that flew over their airspace today.
Easy to imagine how this is going to turn out...
Note that the new order provides a (limited) exemption for options market makers.
Interactive Broker's implementation is that you can still buy puts, but you cannot sell naked (non-covered) calls. So you cannot create a synthetic short, although you can still just buy the puts.
What is YOUR broker doing?
where's goog msft mickey d's internet capital group. cmo
The world's financial markets are officially in a medically induced coma.
The patient is on assisted breathing and life support.
GE? GM?? CapOne??????
As the first dude would say: Effing-a.
Should we still be calling each other Comrades, or does this move take us into an entirely different political model?
GM ceased to be a car company a long time ago. Today, it is a financing firm with an auto manufacturing operation on the side. (Also an HMO.)
Makes perfect sense, if you simply accept the insane premises.
Which one of these is not like the other!
GM but not Ford?
Does this mean Ford is in better shape than GM?
why not just post the stocks you can short, at some point its gonna be a shorter list.
With the Paulson Plan, any debt could be purchased. Since we're picking winners here, why not bail out GMAC and GE capital while we're at it?
$1,800,000: Amount Sen. John McCains (R-AZ) campaign manager Rick Davis was paid as president of a lobbying company founded to defend Fannie Mae and Freddie Mac from stricter regulations, over five years.
Moody's ??
Hard to believe we are following the Pakistan market model...
Having third world leadership and third world standards of education means ultimately turning into a third world country.
When does Cerberus go public and declare itself a bank holding company?
WTF I can't keep up.
Financial crisis: Default by the US government is no longer unthinkable
A default by the US government is no longer unthinkable - Telegraph
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
What a joke.
Observer --
GMAC is (much) bigger than Ford Credit, I believe.
Dont worry Max, we will! Just give it time.
the most import thing going unsaid here is that every damn thing that Paulson has proposed so far has failed to correct the situation, or even slow it down.
Why on earth would we just trust him that this will be his one idea that works?
One of my Senators is on cnbc telling us we need to act quickly to push this bailout through...I guess my emails didn't help...Martinez is such a tool
You all know 2 years ago, we all just thought housing prices would correct.
Those were good times.
Last chance to plunder the treasury before the crash - need that for the express checkout, please!
Negative real interest rates result in capital flight. Sorry for blogwhoring (it's from my blog), but I think there's a serious problem brewing with the US Dollar.
Think Asia in 1997 and Russia in 1998. Negative real interest rates, followed by massive increases in share and property market prices, followed by crash and credit crunch, followed by capital flight and devaluation of currencies.
Dufus - that was one of the specific points I put in to my letters to my Senator and House Rep.
Nice of them to come out with a list of companies to NOT DO BUSINESS WITH!
That's it. I give up. GM??!!! FRIKKIN GM??!!!! MOODY'sS???!!! GE???!! Stewart Information Services Corp??!!CANADIAN, COLUMBIAN, JAPANESE banks???!!
They are not even bothering to use any KY now. It's just BOHICA.
I need to lay down.
However, all the financial institutions on that list can short any company not on the list?
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
Don't kid yourself for one second, energy: they know this just as well as you or I.
They are just throwing the kitchen sink at the problem while hoping against hope that the "far worse crash" holds off until after late January '09 ... so Obama can be painted in broad strokes with the Hoover brush.
I don't think they're going to succeed, but they're putting up a hell of an effort.
Just got off the phone with my CongressCritter's office. I explained to them I thought it was A Bad Thing that taxpayers could bail out companies, while the officers that looted them got away with it. I went on to explain that while I understood the need for liquidity in the financial system, we could do better than the proposed bailout.
According to the nice CongressCritter staff person who took my phone call, many others were doing the same. The interesting thing, as this individual put it to me, was that these calls were coming in UNSOLICITED -- that is, others were reaching the same independent conclusion CR and others have reached.
'Twill be interesting to see how this one works out. Best to all.
energyecon writes:
What all this flailing about does, ultimately, is destroy confidence in capital markets resulting in a crash far worse than that which they have been so desperately trying to avoid.
Ain't that the truth now. No one wants to play in a rigged game.
Interesting Times writes:
You all know 2 years ago, we all just thought housing prices would correct.
Those were good times.
Yes, we didn't anticipate that the cure would be worse than the disease.
Japanese bank Mitsubishi Group says it will buy a 10-20% stake in Wall Street rival Morgan Stanley, beset by credit crunch woes.
Can they to opt out now ?
GMAC is (much) bigger than Ford Credit, I believe.
But not any more, or any less, likely to go bankrupt.
Dufus- here are my points, which I was happy to see that Krugman picked up on many of them a day later.
First, we have no reason to be assured that this will work, and the track record of the legislation's authors does not inspire confidence. Enormous sums of money have already been thrown haphazardly at this problem, only to leave the credit markets still near the freezing point.
Second, we had three years to debate alternatives if this day ever came, and instead of sitting with Congress to come up with contingency plans, we were told that everything was fine, even as it fell apart.
Third, when we can clearly see that an anti-regulation ideology got us to this place - how can we pass a bill that does nothing to address the issues that caused the financial crisis in the first place?
Fourth, how can we propose to directly bail out those people that benefited the MOST from the housing and credit bubbles, with no stipulations in the bill that they will ever be brought to account for their irresponsibility, greed, and at times, criminality?
Fifth, we are about to throw essentially a blank check to the Treasury, on the assurance that taxpayers will be protected, when all evidence points to taxpayers taking the largest hit, and receiving the least benefit. The $700 bil. price tag is not a total figure, just a temporary limit for holdings at any one time. The ultimate price tag is unknowable; we only know who will be on the hook for it.
Thats Ballgame Comrades writes:
Should we still be calling each other Comrades, or does this move take us into an entirely different political model?
People still rely on Pravda for their info, so I think Comrade is still quite apropos.
Anyone else had SKF removed from their account because of "corporate issues" (it's being resolved by my broker, but I don't understand the problem).
Also, XLF now down 4%+ and SKF down 2%+ ...
Yes, we didn't anticipate that the cure would be worse than the disease.
Though even that we might have guessed, based on who is at the helm.
One of my Senators is on cnbc telling us we need to act quickly to push this bailout through...I guess my emails didn't help...Martinez is such a tool
"Give us unlimited powers over the financial system or you'll all die. Honest, we're not just trying to take the economy hostage so we can rob taxpayers at will. This isn't a hold up or anything like that. Have you ever seen a mugger with a smile like this?"
There are far worse things than a depression.
Looks like we might have to learn this the hard way.
Did he just say "In order for it to do what it needs to do it needs to be big enough to do what it needs to do."?!?! Mr. Martinez you are a giant douchenozzle.
Martinez? Hell, you should just move.
I think SKF,DXD, SDS etc were targeted by the latest changes to the short selling rules, expect wierdness.
Being a Proles, today I am celebrating with a glass of victory Gin.
But, but...
Where is the list of companies that asked to be taken off?
Yes, we didn't anticipate that the cure would be worse than the disease.
Seems to me like people have been screaming about this for years, it's just that nobody's been listening.
From the Proshares website today:
ProShares Announcement on SKF and SEF - Sep 22, 2008
Due to the emergency action announced by the Securities and Exchange Commission on September 18, 2008, temporarily prohibiting short sales of shares of certain financial companies, Short Financials ProShares (SEF) and UltraShort Financials ProShares (SKF) are not expected to accept orders from Authorized Participants to create shares until further notice. Unless notified otherwise, shares will be available for redemption by Authorized Participants as normal. The shares of these ProShares are expected to trade in the financial markets. As disclosed in the prospectus, ProShares may at times trade at prices that are not in line with their intraday indicative values.
Sep 22, 2008
Yeah, Florida is just the coolest...Lucky me, Mom died and left me a mortgage that I can't get out of because property values have dropped so stay I must.
Dawg - dont hold your breath. That's one of the conditions of being put on. Not allowed to quibble.
Ministry of Truth --
Excellent.
Hmm... Ben Bernanke ... BB ... Big Brother?
Paulson says bailout plan is doubleplusgood
I'm scared. Hold me.
Short the dollar
Short treasuries
long commodities
Sell all US stocks and bonds
Cut up credit cards
Pull money out of bank
Join underground economy
start underground bank
Scew'em
Does banning short selling have any long-term impact on share price? Eventually you have to buy back short shares and close the position. Doesn't the ability to short just mean more buyers and sellers and thus lower bid/ask spread?
I can haz longs only plez?
I'm serious about this now: when do we see a new SEC rule saying that shares can only be bought at the last transaction price?
Wouldn't a company that opted out likely get sued by shareholders?
I mean, banning short selling "protects" the share price, at least in the short term, so it seems like they'd have a hard time arguing that this would fall under "fiduciary responsibility".
What's most strange is that the people at the helm of this shipwreck are now tasked to to build the new raft. Didn't Bernanke say that the housing crisis was contained? Why is he being asked for leadership?
By my reckoning, $1T could buy enough solar panels to supply the US with 25% of its electrical power needs.
Or we could give it to Paulson.
Geoff,
Don't feel so badly. Daniel Gross appears to be lurking here too.
Lehman: Why Some Banks Don't Get Aid | Newsweek Voices - Daniel Gross | Newsweek.com
Mr Market says : "Can I hasz clobbering now?"
Charles J Gervasi --
Does banning short selling have any long-term impact on share price? Eventually you have to buy back short shares and close the position. Doesn't the ability to short just mean more buyers and sellers and thus lower bid/ask spread?
Of course it does.
All of these plans are too crazy to be proposed by sane people. Unless they think the "underlying problem" is the risk of a panic...
Maybe all of these moves have nothing to do with fixing the real problems and everything to do with manipulating public sentiment. Wonder if it'll work.
I'll take Bernanke over Paulson any day. Larger brain, smaller ego.
Marketwatch headline:
Bailout rally loses steam
Let's see if we can make it to wednesday without something else blowing up.
Crude is 108 and dollar index 77.03... i see confidence returning...to the commodities market!
comrade anymouse
My skf was frozen for a while and then I was able to sell it on Friday. Then I find it back in my account.
Sale reversed because of a rule saying you aren't allowed to sell it for a price that is 20% or more up/down from the previous days close. And now they are just holding my sell order and not letting me sell it.
luckily it was just a small amount I bought Friday morning at open.
Now if they freeze SRS, I have problems.
Bernanke treads a thin line every time he opens his mouth. Look how they blamed Schumer for Indymac.
If I worked for any publicly listed company and owned its stock, I would be demanding they ask to be included in the "list".
allan greenspend...i think you should update your name to all-in green-spend. that guy....id like to pitch and fork him....no wonder paulson wants immunity up front.
Next:
Legislation that says house prices can only go up?
I can haz longs only plez?
Yes, time to go long torches and pitchforks.
Wouldn't a company that opted out likely get sued by shareholders?
Well, either they might get sued for an attempt to artificially prop up the price, or they might get sued for not asking to get on the list, and therefore allowing the price to be driven down. Hobson's choice.
GLG?????
How is that important to the welfare of the US?? Its a hedge fund firm!!!
$700 billion dumped in, and the markets head lower. Am I the only one who is freaking the F out?
Today's the day:
For those angry enough to act: contacting your member of congress is good -- contacting your state/local officials can be useful as well -(see search box in upper left to find all of your elected officials):
Congress.org - Get informed, get involved
If you call their offices, all these officials have staff dedicated to taking complaints/solving problems -- if they get inundated with calls, they are going to do something -even if it is simply informing your officials that the public is outraged.
one of the BEST things you can do is contact your local media - TV station /radio/ and newspaper - and register complaints, and ask why they aren't knocking at elected officials' doors and covering this more. They get enough complaints, it's a story.
Get a few folks together in your neighborhood, church group, whatever - even if it's just your family, and organize a protest, or pass out flyers in front of a bank (yes it's small potatoes, but press are much more likely to cover if there's some kind of visual/audio element they can whip up for their newspaper-website pages or the TV news.) The more visual, the better (can you rent pig costumes - or at least buy those pig noses at a Halloween store?).
National media contacts: (I recommend calling - ask for the newsroom / news assignment desk/ managing editor of news to try to get through)
FAIR's Media Contact List
$700 billion dumped in, and the markets head lower. Am I the only one who is freaking the F out?
The largest trial balloon in history is losing air!
The real danger is if the regulatory bodies allow mark-to-model accounting.
They can guarantee profit in ANY environment quarter after quarter.
A two-page, trillion-dollar proposal that transfers wealth from taxpayers to a Wall Street class that is least sympathetic to them to pass within a week. Am I close?
The Paulson/Bernanke prohibition.
It's a disgrace.
alo,
thanks..I'm heading to finacial district in sf, will be right in front of gs with pig nose and flyers...
And Wall Street says, "NO DEAL"
this is absolutely ridiculous.
this reeks of the bush doctrine.
the ends always justify the means.
i headed to the store for lighter fluid.
Commissar 4822 writes:
$700 billion dumped in, and the markets head lower. Am I the only one who is freaking the F out?
The largest trial balloon in history is losing air!
Commissar 4822 | 09.22.08 - 10:08 am | #
well said, sir.
going long commodities, what makes a safe commodity stock play?
Is a stock that is based outside the US but trades and reports in USD ok?
If a stock is on multiple exhanges will that make it ok?
Or does it have to report in non USD currency and not be listed on the US exchanges?
Has anyone but me noticed that the absolute secrecy surrounding all the Paulson purchases has the effect of preventing "mark to market" on other similar assets? Only he and his associates (cronies) will know what assets are being offered at what prices. Sweet! All the banks will be offering their assets without the slightest idea of what was a winning offer from others in the past. This is the ultimate closed bid auction.
I'm not savvy enough to figure out the implications of all this but it seems important.
How can confidence in the markets be restored without transparency? At some point the players have to be able to look at the assets of an institution and feel comfortable with their valuation before they will risk capital for a bond or equity position.
Something wicked this way comes. This is really a mess.
what makes a safe commodity stock play?
Groceries?
asl,
The truth is, there's no way to estimate the losses from the paper. One thing is for sure; the current holders are scrambling to figure out which contain the most toxic waste so they can unload those first.
This is the point.....NO MELTDOWN. Even if it mean socializing all money flows in this Country...PERIOD.
good point thoth, I had a pollyanna on another forum telling me that GAAP and mark to market would insure that taxpayers actually make money on this bailout...I almost choked...
Has anyone but me noticed that the absolute secrecy surrounding all the Paulson purchases has the effect of preventing "mark to market" on other similar assets?
Looks good, but you left out Section 8 that prevents judicial or agency review.
This looks bad.
Looks like the 30 day CP spread ran 288 bps last Friday, down from about 360 bps the day before but still very high...
Looks bad----Just cut under this bubble on the skin so you can actually see the cancer underneath. Wake up call......
Is TGT on the list ? They are bagholders of a steamin' pile of crap CC receivables.
mp writes:
This looks bad.
It's dangerous, every move is anti-dollar.
"Financial crisis: Default by the US government is no longer unthinkable"
Wrong, it's guaranteed.
Did anyone catch this on bubblevision?
Bailout Plan Boosts Stagflation Risk: El-Erian - CNBC
"The financial system bailout plan, which could end up by costing Washington around $1.8 trillion, may increase the risk of stagflation and will probably cause problems for hedge funds and smaller banks, Mohamed El-Erian, co-CEO of bond giant Pimco, told CNBC on Monday."
May and probably? BWAHAHAHA
Can Paulson be impeached ?
If not, what is the legal method of removing a Cabinet Secretary ?
China, Russia and Japan are firing one across the bow!
Anticpated: All selling to be prohibited during this time of "adjustment"...national security depends on the survival of these companies.
actually, i think we are watching in real time as the Treasury Secretary loses power
Comrade RayOnTheCollective writes:
Can Paulson be impeached ?
If not, what is the legal method of removing a Cabinet Secretary ?
Why are you worried about doing something legal at this point?
pitchesNforks writes:
allan greenspend...i think you should update your name to all-in green-spend. that guy....id like to pitch and fork him....no wonder paulson wants immunity up front.
~~~~~~~~
had the moniker since '04 when folks didn't see his true evil self. i got other AKA's, but still feel a fondness for this one in my macroeconomic world.
I am beginning to hear that gigantic sucking sound as hedgies begin to unwind..........
My heart hurts for my country.
Hedge funds are not protected. Does this mean that they feel hedgies are pushing the markets lower or does it mean the hedgies are to stop shorting entirely. I know most of the hedgies are WAY short EVERYTHING. Guess lazzie fare market capitalisim does not work in the new Socialist Republic of America.
The Notorious A.I.G. writes:
$700 billion dumped in,
not yet it has'nt
The dollar is dropping....
INO Equities Stocks Indexes - U.S $ INDEX (NYBOT:DX) Price Chart and Quote
The mass hysteria is now evidenced by J6P.
The market drop and the gold rise, now 890 range, up $15 on the day, and the drop in the USD, are the symptoms.
The only thing to fear is fear itself.
I dunno what that means, but we'll be hearing it.
The solution is simple. Restore confidence. The American people still believe in the value of the Dollar. Offer MASSIVE FDIC INSURANCE for bank deposits. Do it now.
Instead of fleeing, the American public will trust the government to protect them.
Insure deposits to $1 million or $5 million or whatever. Enough for the public to believe in the insurance.
If you, government, do not do this immediately, the fear will grow and the economy will see credit unavailable. That's economic suffocation.
INSURE THE DEPOSITS.
So, Paulson threw 1.8 TRILLION dollars at the market..........and it's down 130 points.
Why did he do that again?
AIG loving life today as the stock approaches $5. Wheee!
Gaudia- insure the deposits with WHAT?
"My heart hurts for my country."
A patriot must always be ready to defend his country against his government: Edward Abbey
Folks -
I can't believe that I'm writing this.
As of now, mind your tongue when you write on the web.
Echelon.
Maybe all of these moves have nothing to do with fixing the real problems and everything to do with manipulating public sentiment. Wonder if it'll work."
When is the last time curfew laws have inspired a sense of security?
A tested equilibrium is a requirement for a sense of security. It cannot be imposed by force.
I interpret the short sale rules to mean that ""people"" have to unload their financial shares "in relative peace"
homedad43 writes:
Folks -
I can't believe that I'm writing this.
As of now, mind your tongue when you write on the web.
Echelon.
homedad43 | Homepage | 09.22.08 - 10:21 am | #
Are you basing this on some actual event that transpired?
Please take note of the plethora of stock buy back announcements out this morning (MSFT, HP, Nike). Either all these firms came to the same conclusion Sunday night, or Someone like the Emperor Paulson had set this up to restore confidence in our fundamentally sound and strong economy that needs saving withing the next 2 days or something.
Yes, Paulson can be impeached.
US Constitution, Article II, Section 4:
"The President, Vice President and all civil Officers of the United States, shall be removed from Office on Impeachment for, and Conviction of, Treason, Bribery, or other high Crimes and Misdemeanors."
"Sept. 22 (Bloomberg) -- U.S. stocks dropped for the first time in three days as a slide in regional banks overshadowed more than $53 billion in share buybacks and the government's expanded bailout of the financial system.
Regions Financial Corp., Alabama's biggest bank, tumbled 19 percent and Marshall & Ilsley Corp., Wisconsin's largest, dropped 18 percent after analysts advised clients to sell regional banks."
When will it end?
mp writes:
This looks bad.
What aspect of the conjure clock chime of midnight did you not understand!
$700 billion dumped in, and the markets head lower. Am I the only one who is freaking the F out?
Apart from GS and MS losing their franchise to print money without regulation, I think any downward moves this week should be taken with a grain of salt. Let's face it, every bank in the system -- and apparently GM as well -- has an incentive to make it look like we won't last the week to get a deal done on the most favorable terms.
This is what they call painting the tape.
On a different note, why are treasuries up in the face of massive issuance requirements? Why isn't the dollar down a lot more?
Which sounds better government soup kitchen or government sponsored food distribution center?
homedad43 writes:
Folks -
I can't believe that I'm writing this.
As of now, mind your tongue when you write on the web.
Echelon."
What else is new??
Get ready for the Biiiig turnaround, to further the Confidence Game.
How about a "re-education" center for anyone that opposes the bailout bill!
Uh oh, bank stocks are down today. Must be those damn short sellers.
Down 170 now.
but buybacks don't inspire confidence like a big fat Dividend check.
CD great!!- make sure you call the chronicle and some tv - (they really should be there already but ya never know)
CAn you imagine how low it would be with shorting.
I predict by Tuesday King Henry bans selling of stocks. What say you?
9:39AM Oct crude, which expires on close today, makes session highs at $108.01; currently up $3.34 to $107.89
Yes, Paulson can be impeached.
On August 1, 1876, Congress impeached William W. Belknap (then U.S. Secretary of War). So there is precedent.
Doesn't a company or an oblect have to have intrinsic value to be traded between consumers? That is the crux....What value?
To mp's suggestion that we try for some survival strategies to avoid being roadkill, this blog from an Argentine who lived thru the meltdown there might be instructive/helpful.
backpack fever » Blog Archive » Survival After Economic Meltdown
Relax everybody, Sebastian says this is part of the natural business cycle. Lost jobs here, rebuilding there. Building boom, housing bust. Huge profit taking, massive bailout. Just look at last quarters GDP and you'll see that everything is ok.
Sorry Seb...but I no longer make noise when I break wind. Thanks Paulson and Co. for taking away that little joy in life.
Have they said we are in a recession yet? How can they say 911 today when they say the economy is sound. Criminals. I just watched on CNBC were a couple of analyst called this a Christmas tree.
Comrade Baron Von Helmut III writes:
I predict by Tuesday King Henry bans selling of stocks.
Didn't Kudlow already do that? I mean, he has the same authority to (none) he's just more vocal about it.
SEC bans shorting McDonald's stock. {MCD}. If McDonald's stock falls the company will have trouble selling debt.It might go out of business. The whole economy will suffer and there will be a shortage of greaseburgers and healthy fries There will be less competition for other fast food companies. Prices of fast foods will go up. People will stop spending on other things. The whole economy will face a systemic risk. This short selling ban is indefinite and may be extended to other fast food companies to stop a fall in their stock prices. By Order, signed, Kristofer Kocksteiger,[ Herr Fuhrer}
MCO Moody's Corp
How does that make sense? Are they a financial provider to the public? Are they leveraged?
I got short them on Friday thankfully because they are going way lower.
Next stop, Pakistani solution.
BB writes:
Financial crisis: Default by the US government is no longer unthinkable
Telegraph | Error 404 | Sorry, the page you have requested is not available page=1
BB | 09.22.08 - 9:50 am | #
The comments to this article are blatantly anti-semitic--history can be repeated if ignored. There is a political and economic reason (oil) to expect this type of reaction. Shit.
The headline of today's Krugman column was the most politically effective part: CASH FOR TRASH. You don't even have to read any more (and some members of Congress won't). They all read Krugman, and that will leave a mark. The idea is simple enough for a bumper sticker: NO CASH FOR TRASH.
Also devastating was Krugman's line, "Hes making it up as he goes along," referring to Paulson.
Relax this is the setup for when Congress votes yes to the bailout. Huge cheers and rally after!
GOODMORNINNNN' Pakistan! We need to cover the entire market. See its working already.
I won't get worried until money market funds and mutual funds run out of cash. You know, breaking the buck and selling assets to cover redemptions.
Oh, wait...
Stewart Information Services Corp
Headquartered in Houston, Texas
Top Inst. Shareholder: Wachovia
e'nuf said
Awww... nobody wants to take it in the shorts.
Also devastating was Krugman's line, "Hes making it up as he goes along," referring to Paulson.
Captain Obvious to the rescue!
REDMOND, Wash. (AP) -- Software giant Microsoft Corp. said Monday its board approved a plan to buy back up to another $40 billion of its shares.
The program expires on Sept. 30, 2013. As of July 28, Redmond, Wash.-based Microsoft had about 9.13 billion shares outstanding, according to a regulatory filing.
Mel writes:
The comments to this article are blatantly anti-semitic--history can be repeated if ignored. There is a political and economic reason (oil) to expect this type of reaction.
All my friends and neighbors are safe. This is an evil brought by greed - perhaps avarice. We are all citizens now.
Guess lazzie fare market capitalisim does not work in the new Socialist Republic of America.
The process of abandoning of free markets began after the 1987 stock market crash and basically the free market era came to an end in 1998 with the Greenspan Put and the LTCM bailout.
We're witnessing the consequences of a decade of government control over markets now.
"We are all citizens now"
Popeye
Is "serf" not a better word?
Serfdom - Wikipedia, the free encyclopedia
ya know, after reading the basic tenants of the original fascist manifesto,well...see for yourself and make your own conclusions.
Fascist manifesto - Wikipedia, the free encyclopedia
Barley,
NO, it is not.
.... perhaps more accurate, but not better.
For those who still want to protest to Washington, they discount emails. Faxes and phone calls are slightly more effective.
One more step on the ladder.
Seriously, General Motors? My God, the ban on short-selling is soon going to be universal, isn't it? Then what's next? A ban on selling out of a long position?
We may be soon upon the time to abandon paper assets completely.
"We are all citizens now"
Popeye
Is "serf" not a better word?
How about "indentured servants"?
Barley,
I prefer "cottager", but I suppose at this point I might actually be a freeman. But I suspect a push down the rankings is in the works.
Good read--a two-page dissection of the Paulson Plan from a guy at U Chicago. Final sentence: "The time has come to save capitalism from the capitalists."
http://faculty.chicagogsb.edu/luigi.zingales/Why_Paulson_is_wrong.pdf
Apologies if this was posted upthread. No time to read all the posts this AM.
Have a special day.
Faxes and phone calls are slightly more effective.
Fax results in immediate hard copy, "one bird in the hand is worth two in the bush"
Ah... Another wonderful make glorious bailout day!
So lemme guess... after reading the comments, economist's views, news blurbs, we are in a Catch-22. Damned if bailout the fat cats, damned if we don't? Kinda like the choice between the blue pill or the red pill.
Now out: the latest discount rate spread for A2/P2 commercial paper relative to AA nonfinancial
.
Yup, it's still showing tremendous stress in the system. A2/P2 paper is at a painful 5.58%.
We are at the mercy of the honesty and integrity of our elected officials...... I'm not hoping for a lot. Some small gesture would be greatly appreciated.
I'm staying with mp's suggestion of alternative strategies. Some people here may be able to get dual citizenship to the EU...Ireland, Greece and others will grant it if your grandparents were born there. Gives you working/living rights in all EU countires. Could also make it easier to move your money around. Won't work for everybody, could help some. Supreme Court ruled dual citizenship legal.
Local News: West Palm Beach, Palm Beach County, Martin & St. Lucie Counties | The Palm Beach Post
It is really amazing to watch this stream of high government officials saying that this problem just sort of snuck up on them. Do any of these people read? How about just a short ride on this blog. We are doomed!
Anybody who thinks faxes to congresscritters goes to hard copy doesn't know their representative.
Speaking of our wonderful representative form, I wonder how Laura Richardson (D-Long Beach) is doing.
hanging, it's an excuse. they node.
Ladies and Gentlemen, settle down. They know banning shorting doesn't work. They're just trying to limit volatility short term. I agree volatility is really only good for insiders and the lucky, or the manipulators. So although I have been mainly short financials for a while, I've lost my stomach for it. I now agree that the ban may help a little, even if it's only a bandaid. And there's plenty of liquidity in the stock market, that's for sure.
Anybody who thinks faxes to congresscritters goes to hard copy doesn't know their representative.
I hadn't thought of that having only sent faxes from Kinkoes - would they be stored as image files instead at the other end?
I don't know whether I would rather believe that congress is that dumb or a bunch of liars. Probably all of the above.
CNN Quick vote: Do you agree with the Bush administration's decision to spend $700 billion to bail out the financial system?
CNN.com - Breaking News, U.S., World, Weather, Entertainment & Video News
about halfway down on the right - of course when I click on "no" there is no repsonse LOL
try it, if anyone gets any action pls tell
The market is not fooled by the bailout, neither it's enormity nor it's mechanics.
Very simply because it does nothing to address the underlying problem. Treating the symptoms instead of the disease.
Till the bubble in housing is allowed to deflate completely, all the plans will fall short.
This is the bailout that wasn't.
And still the taxpayers lose money!
I think we are in the process of seeing a much smaller US stock market. Lots of stock buybacks as companies hunker down for the long winter ahead.
try it, if anyone gets any action pls tell
34% yes (in favor or plan)
66% no
In case you wanted to know where at least some of our taxpayer 'bailout' money is going.
Fury at $2.5bn bonus for Lehman's New York staff -
Business News, Business - The Independent
'Up to 10,000 staff at the New York office of the bankrupt investment bank Lehman Brothers will share a bonus pool set aside for them that is worth $2.5bn (£1.4bn), Barclays Bank, which is buying the business, confirmed last night.
The revelation sparked fury among the workers' former colleagues, Lehman's 5,000 staff based in London, who currently have no idea how long they will go on receiving even their basic salaries, let alone any bonus payments. It also prompted a renewed backlash over the compensation culture in global finance, with critics claiming that many bankers receive pay and rewards that bore no relation to the job they had done.
A spokesman for Barclays said the $2.5bn bonus pool in New York had been set aside before Lehman Brothers filed for chapter 11 bankruptcy in the United States a week ago. Barclays has agreed that the fund should continue to be ring-fenced now it has taken control of Lehman's US business, a deal agreed by American bankruptcy courts over the weekend.
Barclays is paying $1.75bn for the US operation of Lehman and is keen to retain its best staff. It said it had made no promises to individual staff members about how much they will receive but that the bonus fund would be paid out. In addition to the $2.5bn cash pool, Barclays is also in negotiations with about 30 executives it considers to be Lehman's best assets and plans to offer them contracts worth tens of millions of dollars. British employees of Lehman described the bonus payments as a "scandal" as they waited anxiously yesterday to see whether a deal could be struck with buyers circling the bank's European operations.
Many of Lehman's UK staff are particularly angry about the US payouts because it has emerged that in the days running up to the bankruptcy, some $8bn in cash was transferred out of the account of the bank's European business into accounts at the New York head office.
There is no suggestion any of this cash was used to supplement the bonus fund, but partly as a result of the transfers, PricewaterhouseCoopers (PWC), the administrator to the European business, initially found it impossible to guarantee salaries would be paid. The September wages of thousands of European staff were only secured in the middle of last week, when PWC negotiated a £100m loan to fund the payments. PWC wrote to Lehman Brothers' head office in New York last week, requesting the repayment of the $8bn, but a spokesman said yesterday that the administrator had received no formal response."
Upthread I mentioned anti-semetic commentary from this article--http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/21/ccliam121.xml&page=1
I guess many here discount its meaning--If all wars are economic, isn't all bigotry also economic? This is a very dangerous time--socially as well as economically--and I'm old enough to have talked to survivors of the holocaust. One cousin still waxed over how lovely life was in Vienna until his father was carted away.
can we consider today a couple of days to financial armagedeon..
announce on wed night.
thur, fri, sat, sun, mon....
seems like this bailout isnt needed..
nothing happened..Why the rush..
I dont care,,when the vix went over 38 i went long FRE,,and i'm gonna be a pig about it..lol
Snip * Snip that was an American express card being cut in half. Screw'em
WM down 18% today ... thank goodness for that short sell ban.
If this mauling of the dollar continues, I expect the major CBs to step in with intervention.
Interesting times.
Just heard on the radio that the Bundesbank - oops, I meant the ECB - will not be participating in the Great Bailout. Which places the ECB in fine company, because no other nation than the U.S. seems to be believe that the Great Bailout is a great idea.
Actually, the tone of the news, as far as it goes, could almost be called smirking - as if anyone is going to be dumb to
a. Write a blank check to Wall Street and friends
b. Doing anything that helps George Bush, his cronies, and his political party in any way, shape or form
But then, considering how that bazooka works, it looks like any bank with a significant presence in the U.S. can call on the American taxpayer. Which shows how really stupid the people running the U.S. are - they will be bailing out the same people who caused the problem, and not just Americans - the entire world is invited to just charge it.
Serf's up!
Everybody into the ocean of liquidity...
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?
Just sayin'. There is probably much more to this plan than they can talk about. I'm guessing MS and GS are making their 'banking' moves now in order to pick up banks on-sale from the gov't later.
So the whole point of those bonuses is to reward Lehman employees who helped their business cease to exist, as opposed to succeed?
"The time has come to save capitalism from the capitalists."
as strange (naive) as it may seem, I do not believe that Paulson ever intended to buy bank assets above book value
but the news of the "plan" has to be capitalized on in order to boost-hold the markets ... for now.
I never thought I'd be saying this, but this "Persons of Indian Origin" card makes me feel a little better now. If things really turn to shit, at least I can find my way to Bombay and ride things out with 200 family members.
MarkS writes:
WM down 18% today ... thank goodness for that short sell ban.
Lipstick on a pig indeed...
"If this mauling of the dollar continues, I expect the major CBs to step in with intervention."
Let them buy all the toilet paper they want, there will be plenty more where that came from.
I hadn't thought of that having only sent faxes from Kinkoes - would they be stored as image files instead at the other end?
Yeah, and if you send them snail-mail, the probably scan it and shred the paper.
The big goal of GOP has been to prevent universal health care from ever being realized in America.
Mission accomplished... devastating the economy and destroying the dollar will do the trick.
Mel writes:
Upthread I mentioned anti-semetic commentary
I guess many here discount its meaning--
Mel,
We are all in the same boat now. There will always be folks on the fringe. "They" may be out to get you, but I'm not. We are in this boat together. My suggestion is that we work on rowing in unison.
rich, if you're still on the board, a Q: am I insane to keep holding on to my SRS?
kis writes:
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?"
... you may be on to something there
well boys and grils, here's some fun stuff to lift your mood, or not
Mark Fiore's Animated Cartoon Site
YouTube - Uncle Jay Explains the News - September 3, 2007
kis writes:
If Paulson DOES plan to extract large equity concessions from the banks as part of an over-priced purchase of toxic assets... wouldn't he have to keep that part of the plan secret? And wouldn't they want to stop short selling of those stocks to try to limit the run for the exits now?
Yes, see SEC order to ban shorting on financial stocks...
That's been around since at least 2000. We were in New Zealand at that time and someone got wind of the system's existence and started asking around. It was quite funny because while the U.S. was stoutly saying, "There is no such system," the Kiwi's were blithely saying, "Oh, yeah, we provide a hookup point and closet for Eschelon so the u.s. can record the overseas phone calls routed this way." What amazed me was the lack of outrage all around.
After 9/11 the u.s. released some transcripts of phone calls that had happened months before that were not considered suspicious previously, basically tacit admission of the system's existence. Ostensibly, the system only records international to international calls. And if you believe that they limit it to that with zero oversight, you deserve to lose your rights.
rent_to_own, the rest of the world will help finance the bailout with very low interest rates on their US treasuries. That is the end game.
The shrub was frantically trying to get privatizing SS slammed down our throats. Was the solvency of the entire financial system and government obvious then, I wonder ?
Here is my letter. Probably not to the taste of most people here.
Dear Senator Sanders, Senator Leahy, and Representative Welch,
\tI am writing today to urge you to oppose the ridiculous financial bailout bill proposed by the Bush Administration and Secretary of the Treasury (and former Goldman Sachs CEO) Hank Paulson. It is easily the most naked power grab in the past quarter century, and if passed as-is, it will go down as the Bush Administration's third biggest screw-up (After Iraq/Afghanistan and Katrina). The plan is undemocratic, unaccountable, and fundamentally unwise. The rush to get it passed is a scare tactic aimed at bullying Congress into passing something that favors Wall Street. We saw something similar before the Iraq war, and we know how that turned out.
\tThe plan as currently proposed almost certainly won't work. Buying the various CDOs, MBSs, and other financial instruments at market value would still leave many banks under-capitalized and thus insolvent. But buying the financial instruments at face value would be a huge give-away to Wall Street and other financial gamblers. The only way to avoid a huge giveaway, eliminate the moral hazard, and keep the system functioning is to take over every institution with a whiff insolvency, recapitalize them directly, and manage them until the financial instruments mature and the firms are solvent. It would be ugly, but the American financial system is broken. But so is the idea that unfettered free market capitalism exists in American, or that they work. That has been proven false by very people who most support it Republicans and Wall Street.
\tHere are the conditions that I think should be attached to any bill, no matter the details of how the bailout is implemented:
\tTalk about limiting CEO compensation may feel good, but is basically irrelevant at this point, as is talk about claw-backs - recovering past unwarranted compensation. Helping homeowners should also be separated as it muddles the issues. The focus needs to be on rebuilding the financial system from the top down with a more small-c conservative culture.
Thank you for your time.
I'm guessing MS and GS are making their 'banking' moves now in order to pick up banks on-sale from the gov't later.
Yep. Now they can get banks via FDIC/OTS actions.
about halfway down on the right - of course when I click on "no" there is no repsonse LOL
Worked fine here (Safari 3). Yes: 34% (20089 votes), No 66% (39448 votes)
NEWS FLASH (breaking)
All selling of stocks to be banned...only buying is allowed...
Woo! PPT Monday!
Why don't we just ban the stock market entirely and get it over with?
Comrade RayOnTheCollective writes: Yeah, and if you send them snail-mail, the probably scan it and shred the paper.
Whatever you send, keep it simple. The office staff only have a check list of issues and a "pro/con" count. A simple message (i.e., "Bailout: NO!") will be as appreciated as a longwinded and carefully-footnoted argument, which might get accidentally tallied under "worried about economy".
Let the fun begin:
WASHINGTON (AP) Democrats propose mortgage relief, executive pay limits as part of financial bailout
Bailout Plan: DOA
They'll do an end run around congress now....
Down down 180
Senate version of bill includes equity stakes for the government, and limits executive compensation, per MarketWatch.
That is the only prayer we have of this thing not flying - Dems press for Main Street relief that the administration will say is a deal killer - cramdowns might just be the ticket...
"Why don't we just ban the stock market entirely and get it over with?"
They did. This is a casino with rigged dice, the red and green arrows are for visual effect to keep the suckers playing.
This reminds me of the Woody Allen movie "Bananas." I'm waiting for King Henry to dictate, " All people that are not 30 are now 30. All people will wear their underwear on the outside of their pants."
Wait, it's coming.
"Whatever you send, keep it simple."
I wanted to make three or four points in my faxed letter, but summarized in the first paragraph and kept it to one page in fairly large font.
This is a casino with rigged dice, the red and green arrows are for visual effect to keep the suckers playing.
And we have a winner!
Big Financiers Start Lobbying for Wider Aid
Big Financiers Start to Lobby For Wider Aid - NY Times
Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages.
The scope of the bailout grew over the weekend. As recently as Saturday morning, the Bush administrations proposal called for Treasury to buy residential or commercial mortgages and related securities. By that evening, the proposal was broadened to give Treasury discretion to buy any other financial instrument.
Emailed my CONgressman!
If he does not respond in 24 hours I am going to call and email again until he does!
They'll do an end run around congress now....
Executive Order?
"WASHINGTON (AP) Democrats propose mortgage relief, executive pay limits as part of financial bailout"
Not good enough I want heads on a plater.
The last act of a despotic regime is the looting of the people.
I read that somewhere, always wondered about the actual details.
Bailout poll:
Seattle Bubble — News & discussion about real estate & the housing bubble in the Seattle area.
So who was buying dollars on Friday afternoon? What was the thesis? "Trillion Schmilion"?
BB writes:
"The market is not fooled by the bailout, neither it's enormity nor it's mechanics."
No, but the market may have been so fooled over the last 9 months by fed open-mouth-policy lying, that it probably has not discounted the impending earnings decline and may be 2000 or so points overvalued.
Had to repost this:
"I will not wait on events, while dangers gather," Bush told Congress. "I will not stand by, as peril draws closer and closer. The United States of America will not permit the world's most dangerous regimes to threaten us with the world's most destructive weapons." 2002 State of the Union Address
next speech I say:
...The United States of America will not permit the world's most dangerous financial instruments to threaten us with the world's next Great Depression."
Senate Democrats draft calls for Treasury to get “contingent shares” in companies selling assets, establishing of emergency oversight board to monitor bailout pla
Not sure how they'll do it. But this was an attempt to give them cover. The idea being that the "bi-partisan" approach would enable them to not have to bear the brunt of the blame when this goes tits up.
buymyshitpile.com
Free profits for everyone!
Anonymous writes:
Not good enough I want heads on a plater.
So do I, but we both know that won't happen. If we are very lucky, we will get a minor economic concession. But "beaver built" it, I want something.
You all sound VERY unpatriotic this morning. As an American, I am glad that we have two talented men giving this their full attention.
This was obviously a total surprise. Secretary Paulson and Chairman Bernanke are doing the best they can to play the cards they were dealt.
I support their efforts.
I'm glad we at least have Fox to give us the facts. (F-You communist CNN)
I support the USA.
I support the President.
And I love Jesus.
Stop talking crap and start loving America you damned traitors.
God Bless...
Socialist Steve Forbes was just on CNBC to support the Treasury plan. He says the whole problem was the "mark to market" rule.
peAkcredit writes:
No, but the market may have been so fooled over the last 9 months by fed open-mouth-policy lying, that it probably has not discounted the impending earnings decline and may be 2000 or so points overvalued.
Let's see if the markets wake up to this reality sooner or later.
Also a declining dollar means less returns on dollar denominated assets.
FUCK YEAH - Senate is going for salary caps and equity.
Finally a pebble thrown at the Paulson juggernaut.
And I use the word "juggernaut" in the original Indian sense - malevolent idol crushing worshippers under wooden wheels.
Bill Cara note this morning:
[Bill Cara note:
Equity prices were set to pop this morning when it became apparent to King Henry Paulson that the Dems were going to force him to kiss the Pope's ring in the form of judicial review. so King Henry responded pretty much in the fashion he ran Goldman Sachs, like a bully. He and his Wall Street friends torpedoed the market, and they will keep doing it to show their power. I said this Bull would roar after the deal is done in Washington; the devil's in the details and Congress doesn't like the details you pointed out here. If Congress approves that aspect of the bill, then these cowards ought to be voted out in November -- every single person who voted in support of putting King Henry above the Judiciary. In fact they should be vting for his impeachment this week.
This is serious stuff. A revolution of sorts is going on. The market will tell us how it's going to go.
I hold to my views that if enough pressure is put to bear on Henry he will either have to accept a compromise (has he ever in his life?) or resign, and then there will be a deal, followed by a monster rally that will be the first up-leg in the 2008-2011 Bull market.
The President and the Republicans will not put up with a market crash here. The Dems have voting control, and a heck of an opponent in Paulson's gang. This will be an interesting couple days. Btw, it's a time to review the recent non-Financial Cara 100 Buy Alerts. In the Financials, I do like Canada's Royal Bank plus Options Express and Interactive Brokers.]
Saw some talking head on BubbleVision. he stressed the need for us to "look forward" and fix the mess and not to "look back" at those that caused it.
We are fuked.
"You all sound VERY unpatriotic this morning. As an American, I am glad that we have two talented men giving this their full attention."
Many of us just don't trust them anymore. There are always other economists.
That pesky "mark to market" stuff.....
....why is it that the truth is always the first thing to get sacrificed?
Commercial paper spreads (mentioned above) are predicting meltdown is NOT imminent (as in this week) although they're still predicting a hard time. The spread of 2.88 on 30-day paper predicts a depression, but not a Depression. But 60-day paper is being sold again with a 2.90 spread, so the CP market thinks things will be fairly level for 2 months. 90 day spreads are still out but I think that's just because nobody wants to rollover during the end of year crunch. In any case, the prediction is that we do have at least a few weeks and can think at least a little about how to fix this rather than accepting the first boneheaded plan offered in a screaming panic.
The process of abandoning of free markets began after the 1987 stock market crash and basically the free market era came to an end in 1998 with the Greenspan Put and the LTCM bailout.
We're witnessing the consequences of a decade of government control over markets now.
didn't hear the markets complaining about free money, didn't see them employing it usefully, didn't see them complaining about all the government control, didn't see the republicans setting up all this government control, didn't see them warning of the dangers of going down this path, didn't see diddly.
damn, these government control bots are sneaky
Ha CSC, I wish I had a deflated dollar for everytime I've been told that on other blogs today.
If Paulson is consistent with actions taken with AIG, Fannie and Freddie, then financial firms will be recapitalized and taxpayers will own 79.9% of each company that wants/needs to participate in the program. Thus, the equity of these companies is worth a lot less than what they are currently trading at. It is helpful to ban short sales to mitigate the ensuing panic. And Paulson can't tip his hand that this is the plan; otherwise there is a crisis before he has authorization to deal with it.
just a theory...
I've figured out how we can save the world, we bet it all on pork bellies...Yahoo!
What should really scare everybody is transitioning our government in this time of crisis. This is extraordinary and calls for extraordinary thinking.
We need to postpone the election.
I know people will freak out, but be reasonable. We need Secretary Paulson and President Bush to finish their solution and not just walk away while our balls are in the air. Until they have all our balls in hand, I say NO ELECTION.
Democracy shouldn't mean suicide. No elections until we fix this mess.
Have Shelby, Bunning, et al. weighed in on the Democratic modifications, and the overall plan with those mods added?
Comrade Kristina writes:
I've figured out how we can save the world, we bet it all on pork bellies...Yahoo!
It ...might .. just ..work..
And bring lipstick.
"Comrade Kristina writes:
Ha CSC, I wish I had a deflated dollar for everytime I've been told that on other blogs today."
I do hope you are kidding. I just don't want my internet file to land me in a camp.
God Bless You and President Bush...
Mish posted a nice summary of the problem which is simple to cut and paste and add your comments to for emailing your congressional reps. I did all three of mine just now. Worth a look...
Coup Détat Smoking Cannabis I'm picking up on your sarcasm.
You're killing me CSC...I need to be CSC...
Some deep thinking about the situation from Prof Krugman...
The humbling of the Fed (wonkish)
it seems BB may be out of amunition...
Democracy shouldn't mean suicide. No elections until we fix this mess.
Coup Détat Smoking Cannabis | 09.22.08 - 11:35 am | #
Ah--the trip from weed to blow is so sweet--not so the return trip.
Hey I was told GAAP and mark to market would insure the taxpayers would take no losses on this bailout by someone too, but what do I know...
OMG Mel lmao...
Coup D'etat,
Are you really proposing that Bush has some - I cannot resist the term - Final Solution in mind? And that we should cancel the election to let him implement it? Are you totally mad?
Unless, in Bush's bizarro world, his massive incompetence allows us all to thrive despite Dick Cheney's most sinister plans.
Coup Détat Smoking Cannabis wrote:
No elections until we fix this mess.
"Control? It appears we have a leak. Let's send out a team to plug the hole before he gives away the entire plan."
Insurance, broker and bank indices down 5-10% may be early indicators that the corrupt bail out is not stopping the emerging decline in earnings, borrowing, spending or stock values.
Gradually the continuing economic and asset decline will come into focus, as will the specious, corrupt nature of all the various gov't reassurances to the contrary.
I'm here from the citizenry, and I'm here to help.
Canadian Prime Minister Stephen Harper refused on Monday to say whether he supported the U.S. government's $700 billion plan to rescue financial institutions.
UPDATE 1-Canada's Harper reserves view on U.S. bailout plan
| Reuters
Bet he is thinking the last time they pulled this crap was Auguast 15th 1971.
PPT is selling stocks today to scare congress straight (?)
Russia... diplomatically and militarily isolated..
USA... financially isolated...
BWAHHHHHH.
Mel writes:
"Upthread I mentioned anti-semetic commentary
I guess many here discount its meaning--"
Mel, I notice the same thing, especially during periods of any sort of upheaval. It does seem to be the fall-back position of certain groups to "blame the Jews." I am always quite disturbed by this, yet I would like to agree with Popeye that these people are the "fringe." I absolutely agree with Popeye's statement that we are all in this boat together.
ew thread
Mr. Schmoe:
Now is not the time to be asking questions and playing armchair quarterback. This is an emergency.
We need to stand behind our leaders and trust that they will pull us through as they always have. You don't change horses midstream.
We were VERY lucky that, just by chance, our current chairman was the world's foremost expert on the Great D. God must be on our side, no?
You don't tug on Superman's cape
You don't spit into the wind
You don't pull the mask off the old Lone Ranger
And you don't mess around with Ben.
Until they have all our balls in hand, I say NO ELECTION.
i definitely couldn't get an erection with their hands on my balls
First opt-out!
Diamond Hill Investment Corp. (DHIL)
http://www.cchwallstreet.com/NASDAQ/pdf/nasdaq-regalerts/2008/2008-022.pdf
They did. This is a casino with rigged dice, the red and green arrows are for visual effect to keep the suckers playing.
LOL. The cocktail service really sucks in this here casino
Thank God. The feds are at a temporary loss for words, and the market knows it.
This is what happens when there is no short covering.
The law of unintended consequences.
Enjoy
The last time I heard "final solution" meant extermination of an entire race. Which race gets it this time the "Middle Class Suburban Taxpayer" race?
New thread
NOIDA: The Chief Executive Officer of a company was on Monday beaten to death by a group of dismissed employees inside office premises after a meeting called to resolve dispute between them and the management failed. ( Watch )
L K Chaudhury, the CEO of Gradiano in Udyog Vihar of Greater Noida, was killed when the agitating workers turned violent and beat him up, Senior Superintendent of Police (Noida) R K Chaturvedi said.
Good on Diamond Hill, let's see if they get spanked for it.
Coup D'etat
You've got me. I can't argue with Jim Croce.
Cancel the elections, give GWB some more beer and blow, hire back Brownie, and let's declare Mission Accomplished as many times as it takes. The credit crisis is clearly in its last throes and there will be no civil war because their is just no history of class conflict or malfeasance on Wall Street. Oh. And the operation will pay for its own reconstruction.
Joe Shmoe: You are a great American. Im sorry for doubting your patriotism.
Coup Détat Smoking Cannabis
LOL
i am short AXP and COF. this sucks? at least they are down today... consolation.
"How does buying troubled assets help recapitalize the financial institutions unless the Treasury pays a premium for the assets?"
The treasury is acting as market maker in a market with no buyers. By making the market and by acting as buyer of last resort there will be buyers across the entire buying spectrum of failing products.
What part of that is so hard to understand?
Coup Détat, what was IN that last bowl? lol