Credit market priced for something close to a depression -- We said on Monday that while the equity market is certainly priced for a recession 85% for a serious recession it is the credit market that is truly priced for anything remotely close to a depression, no matter how loosely defined: Spreads on junk bonds just hit a surreal 1,538 basis points over Treasuries (up from 1,450 bps on Tuesday), absolutely smashing the prior record of 1,220 bps during the 2002 double-dip economic turndown. And high-grade bonds are now trading at spreads that in the past were consistent with where high-yield used to trade also at an all-time high of 582 basis points.
Why aren't these spreads coming in more? Like Agnecy spreads, they remain stubbornly high and dry despite the downpour of government guarantees.
This is irrational overshoot at work. Everyone knows the government will borrow and print to prop up the financial system; no one cares. They just want to delever. Period.
So what can the government do about irrational behavior?
Delevering is predicated on an acceptable place to hide. Treasuries, in this case. The government must penalize investors for holding all but s.t. Treasuries. The way to accomplish this is called "quantitative easing": a fancy word for printing money.
A group of the largest US hedge funds has called on the Bank of England to intervene to free an estimated $65bn (£38bn) in assets frozen in London in the collapse of Lehman Brothers, warning that delays could be disastrous for UK plc.
The funds, through the Managed Funds Association, said the scale of the problem was so great that it could undermine bank rescue plans as tens of billions of dollars would be kept out of the market. It was also likely to lead to the failure of some fund managers, said Richard Baker, chief executive of the MFA."
If your hedge fund can't withstand a bankruptcy of one portfolio company, you deserve to fail.
Anybody think the new yields and spreads have anything to do with people's birthdays in April. "Let's see, when were you born? April 11th? So it is. Today's TED spread is 4.11."
Actually 3-mo T-bill going up could be good or bad. Return to risk, good; crowding out, bad.
LIBOR is fictitious at the moment. The banks just make up numbers with no necessary connection to reality. 2-year swap might still be usable, but basically we're flying blind at this point.
Do I smell a new chart series here? Perhaps you will be able to syndicate these babies and retire soon? Good stuff ol boy! You are a great source of info!
This will be a daily posting? You think the crisis is going to continue? Oh.
This is shaping up to be like the hostage crisis in Iran. CR will be the new Nightline,... Day 671 of the crisis and still no resolution, but the NAR forecasts improving sales for next month,...the NAHB hits a new high since the sole surviving homebuilder plans on building one more house this year,...banks claim to be well capitalized.
FOR IMMEDIATE RELEASE
October 16, 2008 Media Contact:
David Barr (202) 898-6992
Beginning today, the Federal Deposit Insurance Corporation (FDIC) will hold the first in a series of conference calls with the banking industry to answer technical questions regarding the newly announced Temporary Liquidity Guarantee Program. Today's call will commence at 2 p.m. Eastern and will run for one hour.
"There has been considerable interest in our new guarantee program since it was first announced on Tuesday," said Sandra Thompson, Director, Division of Supervision and Consumer Protection. "We are encouraged by the interest and want to ensure that bankers have as much information as possible in order to make an informed decision about continuing in the Program after the initial 30-day period ends."
Senior FDIC staff from across functional business lines will be available to answer bankers' questions. To participate in today's conference call, bankers should dial 1-888-790-3533 (USA) or 1-312-470-7288 (International) and, when prompted, they should enter the pass code 9172716#.
Question. If the collapse of oil and oil stocks triggers a flurry of Canadian energy company takeovers is that considered an "industry contract" type of transaction?
NEW YORK (MarketWatch) -- Russian medium-sized bank Globex has frozen early withdrawals from fixed-term deposit accounts for five days, the Moscow Times reported Thursday. Emil Aliyev, vice president of Globex, said the measure was introduced after a rise in demand for early withdrawals of term deposits, "with many depositors explaining that they urgently wanted to transfer their money to VTB and Sberbank," the Moscow Times reported, citing the Interfax news agency. VTB and Sberbank, both state-owned, are among Russia's biggest banks.
Thaksin writes:
All,
Why are stocks not going down as much today ?
Compared too...? We are in a period of unprecedented volatility. Somebody on CNBC went so far as to say ±300 was the new ±30. Really, 300 points is no longer data.
Is MS BK ?
If you ask you know the answer. The real question is will the true condition of MS be acknowledged or denied?
Thaksin,
There is no strength behind the move up to yesterday's close. They're just lingering while new money moves into positions.
One impetus was the Nasdaq got a bump from MSFT-YHOO rumouring, despite there being no rush to do a deal.
I'll guess that there will be a significant selloff today. No good news today, by week's end, or in the next week really other than gasoline/diesel coming down
Once the BoE gets hedge fund fund out from under PwC, and they will, then there will be a fresh supply of assets to be sold on the market asap
This is shaping up to be like the hostage crisis in Iran. CR will be the new Nightline,... Day 671 of the crisis and still no resolution.
Oh, tie a yellow ribbon round the old I-B/
It's been one long year, and they still need me
(you and me)/
If I don't see a yellow ribbon round that old I-B/
I'll stay on the bus, step on the gas, and drive into a tree/
If I don't see a yellow ribbon rou-ound that old I-B
One way to think about credit spreads and monetary policy is to use the analogy of a car and a supertanker.
To stop car from hitting a brick wall, its sufficient to slam on the breaks.
To stop a supertanker from hitting an iceberg, its not enough to stop the propellers from spinning. No, you have to make them spin in the opposite direction, and faster.
The second analogy applies to deflation. The way to fight it is not to stop the contraction of money. The way to fight it is to accelerate the expansion of money. Force people to be afraid of inflation, and you get accelerating velocity of money.
Of course, inflation is its own Pandora's box; but I don't think Bernanke cares about that right now.
Never forget that Iceland has unlimited: 1) heating and volcanic energy, 2) clean drinkin water straight from glaciers and) cod. Now, their bankers may, after all, have to forget about conquering the world...but the population will be fine. Ok, eating fish may get old, but it is healthy
interesting analogy, but turning the screws in the opposite direction rapidly causes turbulence which actually cancels out the force that would normally slow the supertanker down...you either turn the screws slowly, or not at all...which in itself is an interesting analogy for the fed...
In the Commerical Paper space, the outstandings should also be tracked along with the 30 day spread...hmm that plot might be good financial disaster pr0n (plotting the 5 day average of the 30 day spread spread and the outstandings on the same plot)
Thaksin, £40-70bn in assets belonging to hedge funds and they haven't been able to touch them for a month -- and get this, PwC wants them to post margin calls with no promise of being able to touch them any time soon
Pretty much what happened was Lehman US gave themselves bonuses the day before BK, and then stole all of Lehman UK's assets to the US just after declaring BK. Those bonuses weren't paid in the US but there are still plenty of Lehman UK clients who are being told by PwC that it could take 10 years to figure out who owes whom
There will be no end to credit crunch before real savings increase. There will be no increase in savings as long as FED reduces the rate. Low rate = low supply of savings. For God's sake, people need to start using their brains.
Altho Buffett never claimed to want to "time" the market I think it is of interest to note that one can buy a number of his recent purchases at up to just one half what he paid for them. I would trust his judgment re the companies to buy, but not his timing.
From NYT on UBS bailout
"Under the terms of the agreement announced Thursday, $31 billion in American assets will be taken over by the Swiss National Bank, much of it in the form of debt linked to subprime and Alt-A mortgages, in addition to securities linked to commercial real estate and student loans. An additional $18 billion worth of non-American assets will also be transferred. "
So are US taxpayers shelling out $31B for toxic assets held by UBS?
Interestingly, the NYT article does not mention anything about the US role in propping up UBS.
Is the WaPo reporting incorrect... or is NYT deliberately not mentioning that US taxpayers are paying for the toxic assets held by Swiss banks?
Nemo writes:
Whew, I guess we're through the worst of it, then. I'm getting so tired of you first wanna-be's. If there were a market for it, I'd be rich.
--
I was watching a TV commercial directed at kids (always lower class kids and never at rich kids): be optimistic!
Americans are BRED to feel optimistic, look at the brighter side, glass is half full, etc., all meant to ignore the troubling signs as they accumulate over time. We need protracted depression to correct this false optimism where progress is just around the corner even when what is waiting behind the corner is a monster.
NEW YORK (MarketWatch) -- Russian medium-sized bank Globex has frozen early withdrawals from fixed-term deposit accounts for five days, the Moscow Times reported Thursday. Emil Aliyev, vice president of Globex, said the measure was introduced after a rise in demand for early withdrawals of term deposits, "with many depositors explaining that they urgently wanted to transfer their money to VTB and Sberbank," the Moscow Times reported, citing the Interfax news agency. VTB and Sberbank, both state-owned, are among Russia's biggest banks.
comment:
This was announced yesterday and considering the fact that Moscow time is 8 hours ahead Polya is a day and a half late with this "news". On top of that, half the banks in Ukraine have frozen withdrawals several weeks ago, Prominvestbank and Nadra bank for example, how come no report on Ukraine?
There will be no end to credit crunch before real savings increase. There will be no increase in savings as long as FED reduces the rate. Low rate = low supply of savings. For God's sake, people need to start using their brains.
A group of the largest US hedge funds has called on the Bank of England to intervene to free an estimated $65bn (£38bn) in assets frozen in London in the collapse of Lehman Brothers, warning that delays could be disastrous for UK plc.
Altruists. Is 'plc' some kind of mathematically modeled word?
Premier: IMF ready with $14 billion for Ukraine
By OLGA BONDARUK and YURAS KARMANAU 10.16.08, 1:26 PM ET
KIEV, UKRAINE -
Ukraine's prime minister said Thursday the International Monetary Fund is ready to lend the former Soviet republic up to $14 billion to shore up its financial system but asserted it would only happen if the president abandons plans for early parliamentary elections.
An IMF delegation arrived Wednesday to provide advice to Ukrainian authorities and consider extending a loan to stabilize the country's battered banking sector and ailing currency, hit hard by the global financial crisis.
Premier Yulia Tymoshenko said Thursday the Fund was considering loaning Ukraine an amount between $3 billion and $14 billion. The wide range could not be immediately explained.
A spokeswoman at the IMF's Kiev office declined to comment. The delegation is expected to be in talks over the loan well into next week.
Worried Ukrainians continued to pull savings from banks as the government, riven by a political crisis, struggles to support the hryvna currency and investor money flees emerging markets. Orders are also falling for the country's chief export commodity, steel.
This was announced yesterday and considering the fact that Moscow time is 8 hours ahead Polya is a day and a half late with this "news". On top of that, half the banks in Ukraine have frozen withdrawals several weeks ago, Prominvestbank and Nadra bank for example, how come no report on Ukraine?
Anonymous | 10.16.08 - 2:42 pm |
Ukraine and the Baltics came up in a comment thread yesterday, I think Barley provided the stories.
The popular thinking could be if Ukraine fails, then the problem is contained. If Switzerland fails, then the problem spreads like a virus.
Or it may just be people have become exhausted with all that has happened and it now takes a sovereign default to even get a mention.
I think the paper has it right. If I understand the process right, the US is buying foreign held MBS. If they don't it will just get transferred to the American branches of foreign banks anyway.
The Iranian daily Jomhouri-e Eslami has warned against the drop in oil prices, calling on the OPEC countries to immediately reduce their output and export quotas.
David Pearson writes:
One way to think about credit spreads and monetary policy is to use the analogy of a car and a supertanker.
To stop car from hitting a brick wall, its sufficient to slam on the breaks.
To stop a supertanker from hitting an iceberg, its not enough to stop the propellers from spinning. No, you have to make them spin in the opposite direction, and faster.
The second analogy applies to deflation. The way to fight it is not to stop the contraction of money. The way to fight it is to accelerate the expansion of money. Force people to be afraid of inflation, and you get accelerating velocity of money.
Of course, inflation is its own Pandora's box; but I don't think Bernanke cares about that right now.
The only problem with this is that people don't have any money!
The velocity you describe is not cash, it is debt. Debt velocity has slowed to crawl/stop. When banks are worried about repayment and having enough cash_on_hand to remain liquid/solvent....they won't lend. When people are worried about their next paycheck, what little cash they have access to isn't going anywhere exotic....and they can't borrow because all of the fresh debt is going ALL to the banks...instead of being diversely distributed throughout the economy.
Elivis,
From last thread, that's the highest compliment I've ever received. You may dock neath my gun wales and share dinner on the captain's deck anytime.
I have always thought sly Medvedev was trickier that meets the eye. He managed to fire lots of the Putin cronies from positions within the Presidential administration within weeks of taking office, and seems to have cobbled together some sort of power base outside of the FSB apparat.
My suspicion has always been that once the economy went South he would take advantage of the opportunity to blame Putin for the problems and attempt to throw him under the bus.
In which case the Duma would try to override Medvedev's firing of Putin, which I think it can do three times before the parliament must dissolve. In which case we are at 1993.
You should bear in mind that the Iranians have been increasing their oil production for months now - and at the same time suggesting that oil production gets cut. Perhaps they're having a good laugh at everyone's expense.
The current oil price is - historically - still higher than at virtually any point in history bar the past 15 months. Considering that a few short years ago OPEC had an oil price target of $22-28 per barrel, I'd be very surprised if any of the major oil producers is anywhere near "major political turmoil" due to current prices.
In 1993 the man who designed the first Soviet nuclear sub told me what he thought could happen in the event of serious instability. I sure hope the chyorni chemodan is in good hands and that everything will be under control.
I agree. In Latin America it is traditional for banks not to lend. Take Brazilian banks: their loans to asset ratios were often below 50%.
Why did Brazil have an inflation problem if the banks did not lend?
Simple: the banks financed the expansion of government deficits. They owned big chunks of government securities on their balance sheets. The purchases of these government securities were made with injections of money by the Central Bank.
What deflationists don't understand is that government credit can grow as fast as the government (and the Central Bank) want it to. Of course, until hyperinflation becomes a concern.
Oh joy, the market pumpers will be all over this calling the bottom. I wouldn't get too excited about it though, our finances are still a mess. If the foreigners at this point continue to buy into this abyss they deserve to get their heads handed to them. I find it funny that credit markets are imporving, I guess China likes being ripped off.....
Take, what, half of Boston, give them their own currency and banking system? I'm surprised Iceland lasted this long.
Sparhawk | 10.16.08 - 2:11 pm | # "
For us Californians -- something like a Bakersfield Republic.
They may have all the fish they can chew and all the geothermal they want. But as for fuel or anything manufactured (except wool sweaters) they're going to have to pay cash -- in somebody else's currency.
"I think the paper has it right. If I understand the process right, the US is buying foreign held MBS. If they don't it will just get transferred to the American branches of foreign banks anyway."
1) If an international bank subsidiary defaults in the US, in most cases, won't the foreign country need to cover deposits (e.g. Iceland and Landsbanki in UK)? So why should the US taxpayer bail UBS out? (yes, international stability yada,yada,yada...but now the US taxpayer needs to prop the world economic system?)
2) Note that this is not only MBS but also STUDENT LOANS. What is the rationale for that?
I think folks are so tired, that they can't even get angry at being fleeced anymore...
Need to track down a recent list of 'tipping point' prices for oil exporters, that being the crude price that is breakeven for government budgets...sever price declines will lead to another round of underinvestment in production replacement, laying the groundwork for the next price cycle (without getting into the more margginal nature of many of the developments that are occurring, viz. the average size of discovery peaked the 60's).
Mainlanders can't touch the Hang Seng, part of why Shanghai had such a bubble. It's also why foreigners can invest via the H-Shares
As for today's market, it should close at a day's low. We are most likely going to hit new lows (for this year) on all the major indices by week's end barring an intervention for which there appears to be no money on hand at the moment for one
Í gær sagði Bos við fjölmiðla að seðlabanki Hollands hafi ekki fengið réttar upplýsingar um fjárhagsstöðu íslensku bankana frá Fjármálaeftirliti Íslands. Fjármálaeftirlitið íslenska sagði við seðlabanka Hollands að allt væri í góðu þar til yfir lauk, sagði Bos og bætti við: Við gætum endað fyrir dómstólum vegna þessa.
Yesterday, Wouter Bos, the dutch finance minister, said that the Dutch Central Bank did not receive the full/correct information regarding the financial health of Icelandic banks from the Icelandic Finance Ministry. "The Icelandic finance regulator told the Dutch CB that everything was fine until the end," Bos said, and he added "We might end up in court because of this."
Samkvæmt frétt hollenska ríkisútvarpsins nemur tap hollenskra skattgreiðenda 236,5 milljónum evra, jafnvirði nærri 36 milljarða króna en áður hafði komið fram að hollensk sveitarfélög hafi átt 59 milljónir evra inni á reikningum Icesave í Hollandi.
According to news from the dutch state radio, the losses to dutch taxpayers amounts to 236 million euros, but previously it was stated that dutch councils had 59 million euros in Icesave accounts.
Haft er eftir Wouter Bos, fjármálaráðherra Hollands að einstaklingar hafi átt á bilinu 1,6 til 1,7 milljarða evra inni á reikningum íslenskra banka í Hollandi og að þeir muni fá sparifé sitt til baka.
Woter Bos, Dutch finance minister, is reported to have said that individuals had 1.6 to 1.7 billion euros in icelandic banks in Holland, and they would get their deposits back.
Optimism is at the heart of confidence, so how do you fell about your favorite CEO today? Perhaps CR could also have some kind of a new confidence index, or is that in the VIX and TED?
Also see: Projection is a form of defense in which unwanted feelings are displaced onto another person, where they then appear as a threat from the external world. A common form of projection occurs when an individual, threatened by his own angry feelings, accuses another of harboring hostile thoughts.
National debt in Russia is only about 6% of GDP while in the US it's now about 80% or more. Russia has plenty of room to run up the national debt if need be.
Also see: Projection is a form of defense in which unwanted derivatives are displaced onto another government's balance sheets, where they then appear as a threat from the external world.
A common outcome of projection occurs when an individual, threatened by his own evil government, begins harboring hostile thoughts.
Iceland actually might be lucky, first to enter into the economic hellhole and probably first to come out of it.
There are probably going to be whopping 50+ million former service sector workers unemployed in the USofA within next 18-24 months. They are the ones who kept that idiotic 70 percent GDP consumer economy going.
This is the endgame for the current form of USA. If USA were a person, even his accountant would be leaving TOWN just about RIGHT NOW.
This crisis is very similar to the Nordic banking crisis, except much worse. Bad news there just kept coming and coming for 2-3 years until the bottom was finally reached.
Chicago Mercantile Exchange Holdings Q2 2007 Earnings Call Transcript 2007-07-24
Rick Redding
Yeah, open interest is something we do look at as one of the indicators of where potentially volumes can come from. Yeah, you would have to look at the particulars of where those option contracts have open interest is. A lot of it is in the nearby quarterly contract.
So, we think that portends good, well for volumes and not only that, as markets move it's also important because the underlying hedge is the futures contract and those traders will have a delta hedge using futures. So it's not just the fact that the options unwind, it's if the markets move you get the underlying trade, as well.
Gordon Brown is my favorite politician, but this propping up of the inefficient, over-leveraged banking system is insane...how much are we all going to spend to cover up bankster mistakes?
National debt in UK is over 40% by official estimates and over 100% of GDP by some other estimates. This bailout just pushes it over the top!
And we spend our time glued to the stock-market as addicted gamblers waiting for a 'high' to make it all ok.
National debt UK
National Debt as a % of GDP has increased from 30% in 2002 to 36 % in 2007. This was despite the long period of economic expansion. It is primarily due to the governments decision to increase spending on health and education. There has also been a marked rise in social security spending.
National Debt has increased sharply in the past 12 months because of:
Slowing Economy (lower tax receipts, higher spending on unemployment benefits)
Although 43% of GDP is alot it is worth bearing in mind, that other countries have a much bigger problem. Japan for example had a National debt of 158% at the height of their recession. The US national debt is close to 65% of GDP.
National Debt and Financial Bailout
The Nationalisation of Bradford & Bingley and Government purchase of shares in major banks like HBOS will cause even more borrowing. It is estimated National debt will rise to 45% of National Debt by April 2009
It is way above the governments sustainable investment rule of 40% maximum
What is the Real Level of UK National Debt?
However, it is argued that UKs national debt is actually a lot higher. This is because national debt should include pension contributions which the government are obliged to pay.
The Centre for Policy Studies argues that the real national debt is actually £1,340 billion, which is 103.5 per cent of GDP. This figure includes all the public sector pension liabilities such as pensions, Private Finance Initiative contracts e.t.c (Northern Rock liabilities)
Another problem is that with the financial crisis, the government have added an extra £500bn of potential liabilities. Note: the Government has offered to back mortgage securities. They are unlikely to spend this money. But, in theory the government could be liable for extra debts of upto £500bn. If we include this bailout package as a contingent liability National debt would be over 100% of GDP.
It seems to me that a good "cure" for the market would be forcing people to invest, rather than trade.
For example, requiring a 3 month minimum time frame before exiting an initiated position. It would decrease volatility, promote "investment" over trading, reduce deadweight loss on the part of Wall Street, and help with price discovery.
Granted, it might have an initial downward impact on equity prices, but I think it would be an improvement over the casino we have today.
Gaveshire Hathaway,
I'm not looking to close out before today's end so I feel loose. I was expecting a zig zag pattern today, got the first peak, hit just after the day's low, then hit the next peak and have been waiting for it to plummet.
There's nothing out there to let the market pull away from Friday's low, so might as well go with common sense for now and wait them out.
...........
re: PPT,
More often than not it's just the name given to a phenomena which exists due to logical reasons at the individual level.
I suggest you point your readers to a place where they can find the answer: Two shows done on NPR's "This American Life": Episode #355, "The Giant Pool of Money", which explains how the huge pool of investment money available worldwide provided incentives via mortgage backed securities that led to riskier and riskier mortgages being written over the last decade, tying huge amounts of risk to investors who thought they had "safe as money" investments, and Episode #365, "Another Frightening Show About the Economy", which explains how the derivatives and credit default swaps your article alludes to acted as an accelerant to the fire started by the mortgage crisis/US housing bubble, and also discusses whether the recent bailout package will have a chance to unfreeze the credit market (this being the occurrence that made economic experts in the government and private sector sit up and take notice of what was happening).
No, I don't think there's anything special about 3pm, with the exceptions that (a) sometimes margin selling happens then and (b) many mutual funds know at that point whether there's a net buy or sell due.
What's really going on is that people are reacting to a pattern that isn't really there. Humans are built to see patterns, even when there's no underlying cause.
And humans are also great at rationalizing things when the pattern gets broken: "oh, that doesn't count, because Ben announced a rate cut", "oh, that doesn't count becuase of options expiration", "oh, that doesn't count because GM announced earnings".
Now, that doesn't mean you, as a trader, can't make money off it. I personally think technical analysis is the worst kind of voodoo.... but.... if you watch the chart, and you see the X day average cross over the Y day average, and you know there's tons of sheeple following that, but your quote service is faster than theirs, it's free money (sort of.... until it doesn't work).
I know I'm being a bit flippant, but what CR---respectfully---is calling 'a little better' or 'slight improvement', I wanna know for whom???
In a system as evil and corrupt as the FRACTIONAL RESERVE BANKING SYSTEM, any "improvement" in the conditions to ease lending---and therefore create MORE DEBT---is also evil and wrong!
How can we point to slight improvements when our system of banking creates handfuls of super-rich people and destroys the masses under piles of debt and servitude?
You cannot have slight improvements on a system that is terminally ill.
This was the magic of this whole system. You could take a pool of thousands of risky
mortgages, and create a security that was called money-good, as safe as any
investment out there. At least that's what people thought.
But now we know those agencies relied on the wrong data. That same historic data
that had nothing to do with these new kinds of mortgages.
Adam Davidson: And then things got even worse. The thing that took this problem
and turned it into a crisis was something else that was new, something called a
Collateralized Debt Obligation. A CDO. And that brings us back to the guy we met at
the awards dinner in the beginning, Jim Finkel.
Jim Finkel: Were heading to the trading floor of Dynamic Credit, where we
have all of our mortgage analysts, our head trader, our CIO.
Adam Davidson: Jim Finkel runs this CDO shop, Dynamic Credit. It takes up three
modified apartments on the upper East Side of Manhattan. The trading room is like a
factory floor for CDOs, its where they make the things.
Business Week lists the unlucky 13 nations that could follow Iceland
into a melting collapse. In its nations at risk the list contains some
of the usual suspects but a few surprises-
Pakistan
Argentina
Serbia
Turkey
Indonesia
Philippines
Vietnam
Romania
Kazakhstan
Latvia
Hungary
South Korea
New Zealand
I think the reason people talk about 3 pm is that people care more about the close than what happens during the day. What happens in the last hour tends to get a lot of attention as a result.
The current oil price is - historically - still higher than at virtually any point in history bar the past 15 months. Considering that a few short years ago OPEC had an oil price target of $22-28 per barrel, I'd be very surprised if any of the major oil producers is anywhere near "major political turmoil" due to current prices.
Venezuela's public spending for 2009 is based on $60 dollar oil. Iran's budget is based on $55-$60 dollar oil. Saudi Arabia was $50 dollars (I think).
Oil companies are priced right now as if oil is going back under $40. I'm betting we stabilize between $50-$60. Oil at $50+ would be a "max pain" recession.
Ugh, I have to work on conference presentation for my MD on the credit crisis and the impact on aircraft financing, and he's taking the thesis that it will get better, the media is hyping a depression etc.
I just joined a few months ago, so I don't want to go all Jas on him, but he's making me look at signs of progress since all government intervention in the interbank market. This post isn't helping, but thanks CR for sticking to strictly looking at relevant data.
Anonymouse or Sebastian, you guys want to point out some positives?
I was just about to post on that - 6:1 decliners to advancers - some fine algorithms cranking the buys to jack that index and try to mitigate opex damage tomorrow is my WAG...but those are lousy internals any way you look at it.
Now, that doesn't mean you, as a trader, can't make money off it. I personally think technical analysis is the worst kind of voodoo.... but.... if you watch the chart, and you see the X day average cross over the Y day average, and you know there's tons of sheeple following that, but your quote service is faster than theirs, it's free money (sort of.... until it doesn't work).
Sorry about being snippy. Does this answer help?
Eric | 10.16.08 - 3:35 pm | #
I am not a trader; I am an engineer. I have come to the same conclusion. Technical analysis is just plain silly, but since enough people believe it (or act on it like trader Eric), it actually works sometimes.
Most likely but I don't think it's guaranteed. My girlfriend asked me to explain what's happening in a simple analogy so I used this.....
There's a pile of money and over the past thirty years, it's been promised to five different guys who knonw nothing about each other. In 2008, hey all go to collect.
Who gets the money?
She thinks about it and says "why don't they just split it?"
And I said, "Why don't you just give 4/5ths of your retirement to some guy on the street?"
RE,
(actual) Inflation has been ~22% in Argentina due to some monkey-business and inflation-linked debt
Things have been on the skids. My roommate is from Argentina and it can be scary around now, but for now they just live with it. They've been dealing with fiscal problems for a decade
had a blast at the Billionaires for Bailout Rally, danced with my peeps to the music of our visiting Italian marching band in the heart of Wall St, heckled the media and the crowd, hilarious. i bailed when nader took the mike, don't know why he was invited, ugh. no real pics yet, but this from a random tourist. will send video and such later.
I am not a trader; I am an engineer. I have come to the same conclusion. Technical analysis is just plain silly, but since enough people believe it (or act on it like trader Eric), it actually works sometimes.
At the hedge fund I used to work for, there was one summer where we were in a dry spell. If I remember correctly, our fund-of-fund investor had gotten some margin calls, and our books had been cut.
So we had some time on our hands.
Since we had oodles of data, and already had a whiz-band backtesting framework built, we decided to see if there was anything to T.A.
We went out and bought literally every book off the shelf at the local Barnes and Noble. We coded up every indicator.
We tried trading them straight out like the books presented. Over 15 years, over 2,000 stocks, none made money.
We then changed the program to allow it to fit each indicator to each stock. I didn't expect this to work. It didn't.
We coded up a meta-trader.... which would take the buy/sell indicators from multiple strategies. No dice.
Sure, you can make any strategy fit a chart, if you look for the right chart. That's not what makes money though.
BUDAPEST: The Hungarian government struck a deal Thursday to borrow up to €5 billion from the European Central Bank in a bid to avoid becoming - like Iceland - a national victim of the financial crisis.
Hungary is feeling the effects of the credit crisis not because its banks invested in bad mortgages, but because the markets have dried up, depriving it of the ability to service debts denominated in currencies other than the Hungarian forint.
Because interest rates in Hungary are relatively high at 8.5 percent, the majority of borrowers have taken loans in Swiss francs, euros or other currencies with lower interest rates.
Roughly 30 percent of Hungary's public debt and about 60 percent of loans to businesses and individuals are denominated in foreign currencies, making the country acutely vulnerable to a sinking forint.
Hungary also suffers from high public debt and anemic economic growth, scaring risk-averse investors and leading them to take their money out of the country. That puts the forint under even more pressure.
Sandor Jobbagy, a financial analyst at CIB Bank in Budapest, said that by borrowing the equivalent of up to $6.7 billion from the ECB, and talking earlier to the International Monetary Fund, policy makers were trying to scare off "those speculating on weaker Hungarian currency, to show that we have strong external support."
After a steep slide the previous day, the forint recovered some of its value Thursday, and was little changed against the euro and the dollar.
Andras Simor, governor of Central Bank of Hungary said the fundamentals of Hungarian economy have improved in the last two years.
"That doesn't mean we should sit back and say 'Let's wait until the international environment gets better again,"' Simor said. "We have to adjust ourselves to the new environment, and that is exactly what we are doing."
Though Hungary has solicited the advice of the IMF, it has resisted seeking money there, hoping to arrest the slide itself. "We maintain that this is a last resort," Janos Veres, the finance minister, said.
The ECB loan gives Hungary the means to meet its obligations directly even though harder currencies are flowing out, while tight credit markets mean that few banks want to put money into the country.
But the loan comes at a price. The Hungarian central bank had to deposit collateral, denominated in euros, with the ECB.
Addressing the underlying problems will be more difficult than taking a loan, analysts said.
Standard & Poor's, the ratings agency, put Hungary on review for a possible downgrade of its credit rating on Wednesday.
Slower growth takes a bite out of government revenues, and any hint that they are allowing deficits to grow again would put pressure on the currency. The government has said it will withdraw planned tax cuts and look for cuts in government spending.
The details of the new budget will be announced as soon as Saturday.
Hungary is in trouble because of overspending in the past. In 2006, the annual budget deficit reached 9.3 percent of the gross domestic product. While that is expected to fall to just 3.4 percent for 2008, the overall public debt is around 65 percent of gross domestic product.
Because the country has a strongly export-driven economy, the worldwide slowdown will hit hard. The government revised its expectation for growth this year to 1.8 percent, from 2.4 percent.
A spokesman for the Hungarian Financial Supervisory Authority said they conducted a comprehensive survey of the financial sector and found extremely low exposure to the mortgage crisis. The agency said it was monitoring the Hungarian banks closely.
"Figures show us day-to-day that the banks are stable, with more money paid in than they need to pay out," said Istvan Binder, the agency's spokesman. "The whole banking sector is in very good condition at the moment."
Similar, yet so very different
Lower interest rates may have helped ease the pain inflicted on subprime borrowers with their adjusted reset rates, but option-ARM borrowers are in for a much bigger surprise because their mortgage rates don't just reset, they recast. This means that borrowers will have to start making full payments on the loan according to a 30-year-amortized schedule. In effect, Fitch Ratings expects the average monthly payment to jump 63%. Given that many borrowers are already defaulting on marginal increases in the minimum payments due, it seems likely the recasting will be catastrophic to most of these borrowers.
Don't say we didn't warn you
According to Huxley Somerville, a director at Fitch Ratings, $29 billion of these loans will reset by the end of 2009 and another $67 billion in 2010. The drastic increases anticipated on each loan are expected to cause delinquencies to more than double.
The pressure to use farm products for domestic use instead of exports is going to go up dramatically in such a scenario. Argentina has a solid history of instability and the farmers will not win this time round. Don't underestimate it.
Once upon a midnight dreary, while I pondered weak and weary,
Over many a quaint and curious volume of forgotten lore,
While I nodded, nearly napping, suddenly there came a tapping,
As of some one gently rapping, rapping at my chamber door.
'Tis some visitor,' I muttered,tapping at my chamber door -
Only this, and nothing more.
Business Week lists the unlucky 13 nations that could follow Iceland
into a melting collapse. In its nations at risk the list contains some
of the usual suspects but a few surprises-
A year from now North Korea is going to have the strongest economy in the world.
Ah, distinctly I remember it was in the bleak December,
And each separate dying ember wrought its ghost upon the floor.
Eagerly I wished the morrow; - vainly I had sought to borrow
From my books surcease of sorrow - sorrow for the lost Lenore -
For the rare and radiant maiden whom the angels named Lenore -
Nameless here for evermore.
And the silken sad uncertain rustling of each purple curtain
Thrilled me - filled me with fantastic terrors never felt before;
So that now, to still the beating of my heart, I stood repeating
`'Tis some visitor entreating entrance at my chamber door -
Some late visitor entreating entrance at my chamber door; -
This it is, and nothing more,
Even if there were a PPT -- which there isn't -- why would they come storming in at the same time every day?
If you really think you see a pattern, why are you wasting time here instead of getting rich? Just lever up at 2:55 every day and exit before the close. If that does not work, then whatever pattern you think you see simply does not exist.
It is amazing the patterns people think they see in pure noise.
Presently my soul grew stronger; hesitating then no longer,
Sir,' said I,or Madam, truly your forgiveness I implore;
But the fact is I was napping, and so gently you came rapping,
And so faintly you came tapping, tapping at my chamber door,
That I scarce was sure I heard you' - here I opened wide the door; -
Darkness there, and nothing more.
Deep into that darkness peering, long I stood there wondering, fearing,
Doubting, dreaming dreams no mortal ever dared to dream before
But the silence was unbroken, and the darkness gave no token,
And the only word there spoken was the whispered word, Lenore!'
This I whispered, and an echo murmured back the word,Lenore!'
Merely this and nothing more.
--
Americans are bred to love fascism (corporate law-and-order state); they just don't openly admit it. Denial is an emotion that comes easily to Americans.
Mussolini was extremely popular in 1930s Ameerica and some liked him lot better than FDR.
It's popularity is coming back lot sooner than you think.
According to Huxley Somerville, a director at Fitch Ratings, $29 billion of these loans will reset by the end of 2009 and another $67 billion in 2010. The drastic increases anticipated on each loan are expected to cause delinquencies to more than double.
Well, I for one believe that this market is being pumped into OPEX. If this was a normal "rally" we'd see some people selling off hard into the close, not wanting to risk after hours earnings.
Of course the other scenario is that people have been tipped about the after hours results....
Gavshire Hathaway,
The impaired gains at airlines and banks reported today were in some cases beyond expectations. That is clearly a reason to break out the bubbly, and don't let anyone tell you otherwise
Eric,
Thanks for that comment about hedge fund experimentation. Whoever did it could probably write it up and get it published in an economics journal. After, of course, TSHTF, and they don't care about proprietary information anymore.
Well, damn. I guess good traders will have to go back to knowing a lot about 20,000 companies. Ha!
I was doing some reading about the Plaza Accord to find out about the regulatory and oversight failures that lead the Japan's bubble and Lost Decade and all I keep finding is stupid assessments like this:
The Plaza Accord was successful in reducing the US trade deficit with Western European nations but largely failed to fulfill its primary objective of alleviating the trade deficit with Japan because this deficit was due to structural rather than monetary conditions. US manufactured goods became more competitive in the exports market but were still largely unable to succeed in the Japanese domestic market due to Japan's structural restrictions on imports. The recessionary effects of the strengthened yen in Japan's export-dependent economy created an incentive for the expansionary monetary policies that led to the Japanese asset price bubble of the late 1980s.
These guys probably think that the rate cuts in 1927 caused the Great Depression too just because the stock market and credit exploded the moment they were implemented.
Well it's cheaper to bid up the market, if you can reliably do so because there are no guarantees, because it's expensive to try and net out options right now with gamma being huge
Also, no idea how this is playing out, but Citadel the options-trading king has funds in trouble
Last night I dreamed that I was at the zoo and I was looking across the moat into the hyena pen. The hyenas were ripping apart the carcass of '78 AMC Pacer (which I know doesn't make sense but it was a dream) and the people around me seemed to be enjoying themselves and every time the hyenas would rip off a piece of the car crowd would all shout 'Huzzah' like they were at the Renaissance Faire or something.
But then there was a guy in a suit in the pen with the hyenas and they started ripping him to pieces but he didn't seem to be made of anything. Then there were a whole bunch of guys in there and they were all getting ripped apart and they weren't made of anything either. Then the hyenas started ripping themselves apart, not each other but each one was eating itself, and then the people behind me started crying and screaming and I looked around and saw that some of them were turning into hyenas like the Dr. Pepper guy in An American Werewolf in London and I wondered why all of my pop culture references were like 30 years old.
But I was starting to panic and when I turned around again I was on the wrong side of the moat and all of a sudden this shit wasn't funny anymore.
So then I woke up face down on my keyboard and when I looked in the mirror there was a little square with an F5 in the middle of my forehead and I thought "so what? it's only a dream."
It amuses me to see these comments about there being no PPT. However, I am not saying that it is the PPT that causes the 3:00pm rallies or that it is the PPT that consistently causes rallies and or declines.
However, with politicians talking about markets needing to be stabilized every hour, every day and the SEC stopping short selling, there clearly is government intervention in the markets.
Now the question is just to what degree and at which point there is intervention. Lately it has gone as far the president timing his speeches with market events. Now does anybody seriously believe that NO financial intervention takes place? Give me a break.
Reality is that a further falling stock market and its attendant consequences for pension funds, consumer purchasing power, economic confidence, etc is a huge risk to the stability of the country. When toxic financial instruments are bought by the government to OVERTLY influence bank stock prices, it seems utterly silly to think that there is no short term intervention to influence market psychology. It is much cheaper than spending billions giving a confidence boost this way than to purchase dead MBS.
My daughter and I went to a very large thrift store down the road. I like the deals on books and music. She likes dressing like it is 1964. I even got an album with the 1949 recording of Billies "Strange Fruit!"
I like this store because I use it as an economic indicator. Today it was 40% Hispanic, 50% white, and the rest was the usual UN crowd. A year ago it was 10-15% white. Also it has 29 cashiers. All 29 were busy.
Anonymous writes:
Joe the Plumber has now had more press conferences than Sarah Palin.
km4 | 10.16.08 - 3:53 pm | #
Not the average campaign! Wonder what Obama will do in response?"
The "balloons" that Mc Cain has been "floating", whether full of air or full of mud, have had a way to crash short of their target... and wipe out some points in voters opinion.
Obama does not need to do anything.
"No American airline has reported a profit yet, and I don't see how they can pretend that passenger volume/load factors are looking any better"
They are shrinking their way to prosperity - volume down but LOAD FACTOR way up. Works until 100% LF is still not break even at the prevailing fare, a circumstance they just won't contemplate. Not there yet.
Whew, I guess we're through the worst of it, then.
3 rd..still a record
bronze
wow got a silver
GLITNIR BANK $750 MLN BOND MATURING WEDNESDAY WAS NOT PAID-ICELAND
Let the apocalyse in Europe begi
Of course, the TED spread move is entirely due to the T-bill. 3-month Libor has hardly budged.
So averaged out, nothing much has gotten better since the Paulson adoption of the Gordon plan without the benefits for taxpayers?
David Rosenberg:
Credit market priced for something close to a depression -- We said on Monday that while the equity market is certainly priced for a recession 85% for a serious recession it is the credit market that is truly priced for anything remotely close to a depression, no matter how loosely defined: Spreads on junk bonds just hit a surreal 1,538 basis points over Treasuries (up from 1,450 bps on Tuesday), absolutely smashing the prior record of 1,220 bps during the 2002 double-dip economic turndown. And high-grade bonds are now trading at spreads that in the past were consistent with where high-yield used to trade also at an all-time high of 582 basis points.
Jas
For us non-technical folks, what's the difference between 'a little better' and 'slight improvement'?
Is there an index for initial public offerings?
what does "NO PROGRESS" mean?
No Progress means somebody Fkd but no pregnancy
Why aren't these spreads coming in more? Like Agnecy spreads, they remain stubbornly high and dry despite the downpour of government guarantees.
This is irrational overshoot at work. Everyone knows the government will borrow and print to prop up the financial system; no one cares. They just want to delever. Period.
So what can the government do about irrational behavior?
Delevering is predicated on an acceptable place to hide. Treasuries, in this case. The government must penalize investors for holding all but s.t. Treasuries. The way to accomplish this is called "quantitative easing": a fancy word for printing money.
Coming soon, to a theater near you.
No worries. If Lehman Brothers was not too big to fail, then neither is Iceland.
GLITNIR BANK $750 MLN BOND MATURING WEDNESDAY WAS NOT PAID-ICELAND
Correct me if I'm wrong, but isn't that what is commonly referred to by today's kids as a default?
From the FT today:
"Hedge funds call for intervention on Lehman
A group of the largest US hedge funds has called on the Bank of England to intervene to free an estimated $65bn (£38bn) in assets frozen in London in the collapse of Lehman Brothers, warning that delays could be disastrous for UK plc.
The funds, through the Managed Funds Association, said the scale of the problem was so great that it could undermine bank rescue plans as tens of billions of dollars would be kept out of the market. It was also likely to lead to the failure of some fund managers, said Richard Baker, chief executive of the MFA."
If your hedge fund can't withstand a bankruptcy of one portfolio company, you deserve to fail.
Anybody think the new yields and spreads have anything to do with people's birthdays in April. "Let's see, when were you born? April 11th? So it is. Today's TED spread is 4.11."
the financial commercial papers appears to be cliff diving
Now now now
why is MS tanking ?
BK inevitable ?
Nemo writes:
No worries. If Lehman Brothers was not too big to fail, then neither is Iceland.
Take, what, half of Boston, give them their own currency and banking system? I'm surprised Iceland lasted this long.
Actually 3-mo T-bill going up could be good or bad. Return to risk, good; crowding out, bad.
LIBOR is fictitious at the moment. The banks just make up numbers with no necessary connection to reality. 2-year swap might still be usable, but basically we're flying blind at this point.
Re: "daily post"
Do I smell a new chart series here? Perhaps you will be able to syndicate these babies and retire soon? Good stuff ol boy! You are a great source of info!
fear not - the economy is only mostly dead. You see, there is a big difference between mostly dead and all dead..
Obligatory....
It's the bottom!
This will be a daily posting? You think the crisis is going to continue? Oh.
This is shaping up to be like the hostage crisis in Iran. CR will be the new Nightline,... Day 671 of the crisis and still no resolution, but the NAR forecasts improving sales for next month,...the NAHB hits a new high since the sole surviving homebuilder plans on building one more house this year,...banks claim to be well capitalized.
banks are in deeep doo-doo
GLITNIR BANK $750 MLN BOND MATURING WEDNESDAY WAS NOT PAID-ICELAND
(To paraphrase J. Paul Getty)
When the bank owes you $750, that's the bank's problem. When the bank owes you $750 million, that's your problem.
"In Soviet Russia, bank runs on you"
More financial system necrophilia please!
This is bad:
YouTube - 5th Dimension sings Age Of Aquarius Let The Sunshine In
potential bottom signal: irreverent headlines.
NYT: Microsofts Ballmer sneezes. Yahoo has tissues. Stock soars.
"Hedge funds call for intervention on Lehman
That's what we need. A camera following these guys around as family members gather and tell the world how fucked up these people have become.
FDIC conf call now... call in details below:
FOR IMMEDIATE RELEASE
October 16, 2008 Media Contact:
David Barr (202) 898-6992
Beginning today, the Federal Deposit Insurance Corporation (FDIC) will hold the first in a series of conference calls with the banking industry to answer technical questions regarding the newly announced Temporary Liquidity Guarantee Program. Today's call will commence at 2 p.m. Eastern and will run for one hour.
"There has been considerable interest in our new guarantee program since it was first announced on Tuesday," said Sandra Thompson, Director, Division of Supervision and Consumer Protection. "We are encouraged by the interest and want to ensure that bankers have as much information as possible in order to make an informed decision about continuing in the Program after the initial 30-day period ends."
Senior FDIC staff from across functional business lines will be available to answer bankers' questions. To participate in today's conference call, bankers should dial 1-888-790-3533 (USA) or 1-312-470-7288 (International) and, when prompted, they should enter the pass code 9172716#.
Now Ballmer can buy Iceland and Yahoo and have money left over.
By the way, isn't this credit market assessment like saying, "The Titanic is sinking slightly more slowly, could be good news."
Question. If the collapse of oil and oil stocks triggers a flurry of Canadian energy company takeovers is that considered an "industry contract" type of transaction?
How exciting would a reality TV show on a hedge fund be rignt now. I could just se the climax "Bam We're Dead".
Does the US economy have "system restore?"
"How exciting would a reality TV show on a hedge fund be rignt now. I could just se the climax "Bam We're Dead".
Ministry of Truth"
Clearly not as exciting as following Pam Anderson around.
Mel writes:
Does the US economy have "system restore?"
It's called "Plan Amish"
"In Soviet Russia, bank runs on you"
No joke:
Russian bank Globex freezes withdrawals: report
NEW YORK (MarketWatch) -- Russian medium-sized bank Globex has frozen early withdrawals from fixed-term deposit accounts for five days, the Moscow Times reported Thursday. Emil Aliyev, vice president of Globex, said the measure was introduced after a rise in demand for early withdrawals of term deposits, "with many depositors explaining that they urgently wanted to transfer their money to VTB and Sberbank," the Moscow Times reported, citing the Interfax news agency. VTB and Sberbank, both state-owned, are among Russia's biggest banks.
How about something unique and bizarro (kind of like that "popsicle index")?
Better yet one that you produce:
perhaps the frequency of Jas Jain posts invoking "born-and-bred dopes"?
Or everyone's new favourite, the CRVIX
All,
Why are stocks not going down as much today ?
Is MS BK ?
The way forward is not backwards.
How about this:
"Market rallies only to resume sawing own leg".
The way forward is not backwards.
Darth Paulson
Unless there is rapid pitbull in front of you. Then the way forward is back and around.
Thaksin writes:
All,
Why are stocks not going down as much today ?
Compared too...? We are in a period of unprecedented volatility. Somebody on CNBC went so far as to say ±300 was the new ±30. Really, 300 points is no longer data.
Is MS BK ?
If you ask you know the answer. The real question is will the true condition of MS be acknowledged or denied?
Elvis,
did you mean rabid? Though rapid would be bad enough.
"In Soviet Russia, bank runs on you"
That's the way it was, through confiscatory low wages.
After closing, I put our pit bull in the store to greet late night purchasers. In the morning, I usually find just the shoes.
GM to lay off 1,500 workers at two plants in Michigan, one in Delaware due to slowing demand
Thaksin,
There is no strength behind the move up to yesterday's close. They're just lingering while new money moves into positions.
One impetus was the Nasdaq got a bump from MSFT-YHOO rumouring, despite there being no rush to do a deal.
I'll guess that there will be a significant selloff today. No good news today, by week's end, or in the next week really other than gasoline/diesel coming down
Once the BoE gets hedge fund fund out from under PwC, and they will, then there will be a fresh supply of assets to be sold on the market asap
So the US taxpayer bails out UBS too...(WaPo today).
When will the taxpayers stop paying for the excesses of Wall Street? This is f* unbelievable
Dammit Lefty I told you. Iput the money on the counter. Now I want my shoes back. [Where ya been?]
Ministry of Truth writes:
GM to lay off 1,500 workers at two plants in Michigan, one in Delaware due to slowing demand
Or, GM to reallocated human capital toward more productive purposes in show of patriotism.
--bh
EvilHenryPaulson , Thanks
But PWC managed Lehman book is that big ? Do you have a size estimate ?
sdtfs writes:
This is shaping up to be like the hostage crisis in Iran. CR will be the new Nightline,... Day 671 of the crisis and still no resolution.
Oh, tie a yellow ribbon round the old I-B/
It's been one long year, and they still need me
(you and me)/
If I don't see a yellow ribbon round that old I-B/
I'll stay on the bus, step on the gas, and drive into a tree/
If I don't see a yellow ribbon rou-ound that old I-B
One way to think about credit spreads and monetary policy is to use the analogy of a car and a supertanker.
To stop car from hitting a brick wall, its sufficient to slam on the breaks.
To stop a supertanker from hitting an iceberg, its not enough to stop the propellers from spinning. No, you have to make them spin in the opposite direction, and faster.
The second analogy applies to deflation. The way to fight it is not to stop the contraction of money. The way to fight it is to accelerate the expansion of money. Force people to be afraid of inflation, and you get accelerating velocity of money.
Of course, inflation is its own Pandora's box; but I don't think Bernanke cares about that right now.
Thaksin writes:
Why are stocks not going down as much today ?
Because buyers and sellers appear at this moment to be in a state of equillibrium.
While there might be some slight improvement, there's still too much flaccidity in the market.
Never forget that Iceland has unlimited: 1) heating and volcanic energy, 2) clean drinkin water straight from glaciers and) cod. Now, their bankers may, after all, have to forget about conquering the world...but the population will be fine. Ok, eating fish may get old, but it is healthy
ahh david,
interesting analogy, but turning the screws in the opposite direction rapidly causes turbulence which actually cancels out the force that would normally slow the supertanker down...you either turn the screws slowly, or not at all...which in itself is an interesting analogy for the fed...
Because buyers and sellers appear at this moment to be in a state of equillibrium.
Dummy | 10.16.08 - 2:28 pm | #
Dummy - You shouldnt have come openly and proved yourself a dumb a**
my Q was why is the equilibrium not at a lower level ?
Anyone taking bets for 3pm?
I have money in an Iceland bank. What should I do?
8200 on dow
j/k
In the Commerical Paper space, the outstandings should also be tracked along with the 30 day spread...hmm that plot might be good financial disaster pr0n (plotting the 5 day average of the 30 day spread spread and the outstandings on the same plot)
i.e for 3 pm
Thaksin,
£40-70bn in assets belonging to hedge funds and they haven't been able to touch them for a month -- and get this, PwC wants them to post margin calls with no promise of being able to touch them any time soon
Pretty much what happened was Lehman US gave themselves bonuses the day before BK, and then stole all of Lehman UK's assets to the US just after declaring BK. Those bonuses weren't paid in the US but there are still plenty of Lehman UK clients who are being told by PwC that it could take 10 years to figure out who owes whom
It's a minor factor, but worth noting
my bet already placed...long steel
down huge.
There will be no end to credit crunch before real savings increase. There will be no increase in savings as long as FED reduces the rate. Low rate = low supply of savings. For God's sake, people need to start using their brains.
Thanks Evilhenrypaulson. Your down move has started
Russian bank Globex freezes withdrawals: report
Is this the same Globex run by Hank Scorpio?
Altho Buffett never claimed to want to "time" the market I think it is of interest to note that one can buy a number of his recent purchases at up to just one half what he paid for them. I would trust his judgment re the companies to buy, but not his timing.
buffet is senile now and wants to have sex..
commiting sins for it
Why are stocks not going down as much today ?
Because prices fluctuate.
Get used to it, or get out of the game.
Confidence Game Prestidigitation will levitate the nation...
Thanks Eric. How much did you lose today ?
Rob Dawg, are you calling from the afterlife? Gimme the Dow number for the end of the year? Free pretzels.
Blackhat,
Ahh, a person that knows fluid dynamics.
That's what I get for basing an analogy on having watched "The Titanic".
Still, you get the point...
Thaksin
From your reply, sounds like you should stay out of this market.
Thanks Eric. How much did you lose today ?
Up small today, right now.
I have money in an Iceland bank. What should I do?
Just chill out.
Credit freeze will thaw soon.
From NYT on UBS bailout
"Under the terms of the agreement announced Thursday, $31 billion in American assets will be taken over by the Swiss National Bank, much of it in the form of debt linked to subprime and Alt-A mortgages, in addition to securities linked to commercial real estate and student loans. An additional $18 billion worth of non-American assets will also be transferred. "
So are US taxpayers shelling out $31B for toxic assets held by UBS?
Interestingly, the NYT article does not mention anything about the US role in propping up UBS.
Is the WaPo reporting incorrect... or is NYT deliberately not mentioning that US taxpayers are paying for the toxic assets held by Swiss banks?
sdtfs writes:
This is shaping up to be like the hostage crisis in Iran. CR will be the new Nightline,... Day 671 of the crisis and still no resolution.
We'll be sitting in a cave fighting over squirrel scraps by then.
I'm predicting the bottom falls out of equities in about twenty five minutes.
Nemo writes:
Whew, I guess we're through the worst of it, then. I'm getting so tired of you first wanna-be's. If there were a market for it, I'd be rich.
--
I was watching a TV commercial directed at kids (always lower class kids and never at rich kids): be optimistic!
Americans are BRED to feel optimistic, look at the brighter side, glass is half full, etc., all meant to ignore the troubling signs as they accumulate over time. We need protracted depression to correct this false optimism where progress is just around the corner even when what is waiting behind the corner is a monster.
Houston, we got a problem optimitis.
Jas
David,
Just nit-picking, but I like the analogy.
Russian bank Globex freezes withdrawals: report - MarketWatch
NEW YORK (MarketWatch) -- Russian medium-sized bank Globex has frozen early withdrawals from fixed-term deposit accounts for five days, the Moscow Times reported Thursday. Emil Aliyev, vice president of Globex, said the measure was introduced after a rise in demand for early withdrawals of term deposits, "with many depositors explaining that they urgently wanted to transfer their money to VTB and Sberbank," the Moscow Times reported, citing the Interfax news agency. VTB and Sberbank, both state-owned, are among Russia's biggest banks.
comment:
This was announced yesterday and considering the fact that Moscow time is 8 hours ahead Polya is a day and a half late with this "news". On top of that, half the banks in Ukraine have frozen withdrawals several weeks ago, Prominvestbank and Nadra bank for example, how come no report on Ukraine?
There will be no end to credit crunch before real savings increase. There will be no increase in savings as long as FED reduces the rate. Low rate = low supply of savings. For God's sake, people need to start using their brains.
A group of the largest US hedge funds has called on the Bank of England to intervene to free an estimated $65bn (£38bn) in assets frozen in London in the collapse of Lehman Brothers, warning that delays could be disastrous for UK plc.
Altruists. Is 'plc' some kind of mathematically modeled word?
Forbes.com File Not Found
Premier: IMF ready with $14 billion for Ukraine
By OLGA BONDARUK and YURAS KARMANAU 10.16.08, 1:26 PM ET
KIEV, UKRAINE -
Ukraine's prime minister said Thursday the International Monetary Fund is ready to lend the former Soviet republic up to $14 billion to shore up its financial system but asserted it would only happen if the president abandons plans for early parliamentary elections.
An IMF delegation arrived Wednesday to provide advice to Ukrainian authorities and consider extending a loan to stabilize the country's battered banking sector and ailing currency, hit hard by the global financial crisis.
Premier Yulia Tymoshenko said Thursday the Fund was considering loaning Ukraine an amount between $3 billion and $14 billion. The wide range could not be immediately explained.
A spokeswoman at the IMF's Kiev office declined to comment. The delegation is expected to be in talks over the loan well into next week.
Worried Ukrainians continued to pull savings from banks as the government, riven by a political crisis, struggles to support the hryvna currency and investor money flees emerging markets. Orders are also falling for the country's chief export commodity, steel.
I have 25 cents left over in an Icelandic account....should I be worried?
This was announced yesterday and considering the fact that Moscow time is 8 hours ahead Polya is a day and a half late with this "news". On top of that, half the banks in Ukraine have frozen withdrawals several weeks ago, Prominvestbank and Nadra bank for example, how come no report on Ukraine?
Anonymous | 10.16.08 - 2:42 pm |
Ukraine and the Baltics came up in a comment thread yesterday, I think Barley provided the stories.
The popular thinking could be if Ukraine fails, then the problem is contained. If Switzerland fails, then the problem spreads like a virus.
Or it may just be people have become exhausted with all that has happened and it now takes a sovereign default to even get a mention.
It was only a few weeks ago that Medvedev pleaded publicly with the US to get its financial house in order.
Leftys Liquors & Lubricants writes:
Rob Dawg, are you calling from the afterlife? Gimme the Dow number for the end of the year? Free pretzels.
What? Do I look like Rukeyser? Let's just say the pretzels are going to be worth more than the divvys.
Serious, the earnings are about to trigger a massive leg down as some people still believe in the P/E ratio.
we close north of 903 spu's
I'd like to point out that Oil is now below the price where Russia's giant budget "profizit" turns into a "defizit"
And there's only like three hundred billion in the stabilization fund I think.
Weeks away from political turmoil...
"The popular thinking could be if Ukraine fails, then the problem is contained."
Why? Do you mean 'if only Ukraine fails'?
Jas Jain | Homepage | 10.16.08 - 2:41 pm |
[DOPEDEX : slight improvement]
434 Visitors Online
: No improvement yet]
[(CRVIX
Put me in for 1400 on the S&P by the close.
I have 25 cents left over in an Icelandic account....should I be worried?
They don't have your credit card, do they?
bp,
I think the paper has it right. If I understand the process right, the US is buying foreign held MBS. If they don't it will just get transferred to the American branches of foreign banks anyway.
ok, i will go counter, and say $SPX 924
disclosure: 100% cash
You know what's interesting, the corrupt countries that have big organized crime involvement in banking haven't been the ones to show problems
(as far as I know, up to this point)
Unrelated article about the global nature of today's organized crime
is haloscan's clock right?
PPT quandry--they want to help McCain win but they don't have enough bullets to last 3 weeks.
Weeks away from political turmoil...
NevskyProspekt | 10.16.08 - 2:47 pm | #
The MEMRI Blog - Full Blog Entry
Iranian Daily Calls On OPEC To Reduce Oil Output
The Iranian daily Jomhouri-e Eslami has warned against the drop in oil prices, calling on the OPEC countries to immediately reduce their output and export quotas.
Source: Jomhouri-e Eslami, Iran, October 16, 2008
David Pearson writes:
One way to think about credit spreads and monetary policy is to use the analogy of a car and a supertanker.
To stop car from hitting a brick wall, its sufficient to slam on the breaks.
To stop a supertanker from hitting an iceberg, its not enough to stop the propellers from spinning. No, you have to make them spin in the opposite direction, and faster.
The second analogy applies to deflation. The way to fight it is not to stop the contraction of money. The way to fight it is to accelerate the expansion of money. Force people to be afraid of inflation, and you get accelerating velocity of money.
Of course, inflation is its own Pandora's box; but I don't think Bernanke cares about that right now.
The only problem with this is that people don't have any money!
The velocity you describe is not cash, it is debt. Debt velocity has slowed to crawl/stop. When banks are worried about repayment and having enough cash_on_hand to remain liquid/solvent....they won't lend. When people are worried about their next paycheck, what little cash they have access to isn't going anywhere exotic....and they can't borrow because all of the fresh debt is going ALL to the banks...instead of being diversely distributed throughout the economy.
"Weeks away from political turmoil..."
Perhaps or perhaps not, but the phrase 'political turmoil' has an ominous sound.
long 175%
Wounded Polyphemos can hurl boulders.
Elivis,
From last thread, that's the highest compliment I've ever received. You may dock neath my gun wales and share dinner on the captain's deck anytime.
Force people to be afraid of inflation, and you get accelerating velocity of money? Huh? How does that work?
Looks like a rally to end today.
I have always thought sly Medvedev was trickier that meets the eye. He managed to fire lots of the Putin cronies from positions within the Presidential administration within weeks of taking office, and seems to have cobbled together some sort of power base outside of the FSB apparat.
My suspicion has always been that once the economy went South he would take advantage of the opportunity to blame Putin for the problems and attempt to throw him under the bus.
In which case the Duma would try to override Medvedev's firing of Putin, which I think it can do three times before the parliament must dissolve. In which case we are at 1993.
JS writes:
Looks like a rally to end today.
Magic 8 Ball says: Doubtful
come on STEEEEEEL
boooo yaaaaa hahahahhaha
http://voices.washingtonpost.com/the-trail/2008/10/15/palin_as_president_the_interac.html
WAPO -Palin as President: The Interactive Satire
PalinAsPresident.com
I have 25 cents left over in an Icelandic account....should I be worried?
borkafatty | 10.16.08 - 2:45 pm | #
Iceland welcomes you as their new king.
JS writes:
Looks like a rally to end today.
JS | 10.16.08 - 2:54 pm | #
volume still low
the corrupt countries that have big organized crime involvement in banking haven't been the ones to show problems
Confidence and credibility were already low. Probably leverage, too.
Anon
You should bear in mind that the Iranians have been increasing their oil production for months now - and at the same time suggesting that oil production gets cut. Perhaps they're having a good laugh at everyone's expense.
The current oil price is - historically - still higher than at virtually any point in history bar the past 15 months. Considering that a few short years ago OPEC had an oil price target of $22-28 per barrel, I'd be very surprised if any of the major oil producers is anywhere near "major political turmoil" due to current prices.
I'd predict a rally into the close, just due to opex. But i'm rarely correct.
"In which case we are at 1993."
Tank shells hitting the Byelii Dom.
In 1993 the man who designed the first Soviet nuclear sub told me what he thought could happen in the event of serious instability. I sure hope the chyorni chemodan is in good hands and that everything will be under control.
Force people to be afraid of inflation, and you get accelerating velocity of money? Huh? How does that work?
People yank their rapidly depreciating money out of banks and spend it.
Looks like one half of it is working.
GH,
Same thinking and track record lol
Oil discussions are off topic.
That said funding efforts to destroy Western culture with a funding stream that depends on Western money is self defeating. Duh.
On topic. Many oil producing nations extended themselves against future projected oil revenues. Ruh roh.
Gavshire,
It's a bear market. Identify points of weakness, and sell into rallies. Popeye was born a pirate.
Darth,
I agree. In Latin America it is traditional for banks not to lend. Take Brazilian banks: their loans to asset ratios were often below 50%.
Why did Brazil have an inflation problem if the banks did not lend?
Simple: the banks financed the expansion of government deficits. They owned big chunks of government securities on their balance sheets. The purchases of these government securities were made with injections of money by the Central Bank.
What deflationists don't understand is that government credit can grow as fast as the government (and the Central Bank) want it to. Of course, until hyperinflation becomes a concern.
Oh joy, the market pumpers will be all over this calling the bottom. I wouldn't get too excited about it though, our finances are still a mess. If the foreigners at this point continue to buy into this abyss they deserve to get their heads handed to them. I find it funny that credit markets are imporving, I guess China likes being ripped off.....
" Sparhawk writes:
Nemo writes:
Take, what, half of Boston, give them their own currency and banking system? I'm surprised Iceland lasted this long.
Sparhawk | 10.16.08 - 2:11 pm | # "
For us Californians -- something like a Bakersfield Republic.
They may have all the fish they can chew and all the geothermal they want. But as for fuel or anything manufactured (except wool sweaters) they're going to have to pay cash -- in somebody else's currency.
"I think the paper has it right. If I understand the process right, the US is buying foreign held MBS. If they don't it will just get transferred to the American branches of foreign banks anyway."
1) If an international bank subsidiary defaults in the US, in most cases, won't the foreign country need to cover deposits (e.g. Iceland and Landsbanki in UK)? So why should the US taxpayer bail UBS out? (yes, international stability yada,yada,yada...but now the US taxpayer needs to prop the world economic system?)
2) Note that this is not only MBS but also STUDENT LOANS. What is the rationale for that?
I think folks are so tired, that they can't even get angry at being fleeced anymore...
ioniancat21 writes:
Oh joy, the market pumpers will be all over this calling the bottom.
It's not direction, it's time.
And DOWN the stretch they come!!!
I guess China likes being ripped off.....
ioniancat21 | 10.16.08 - 3:01 pm | #
See the Hang Seng lately?
It's a national pasttime.
eh, rally doesn't have conviction. Going to get ugly.
It would appear that inquisitors from the Church of Peak Oil have been dispatched to CR to ensure that heresy is rooted out.
Need to track down a recent list of 'tipping point' prices for oil exporters, that being the crude price that is breakeven for government budgets...sever price declines will lead to another round of underinvestment in production replacement, laying the groundwork for the next price cycle (without getting into the more margginal nature of many of the developments that are occurring, viz. the average size of discovery peaked the 60's).
ioniancat21 writes:
Oh joy, the market pumpers will be all over this calling the bottom.
Theme music: YouTube - Ecclesiastes 3 To Every Thing There Is A Season Ecc
I don't know which is more entertaining.... watching the actual market move around, or listening to the people who actually think the PPT exists.
Mainlanders can't touch the Hang Seng, part of why Shanghai had such a bubble. It's also why foreigners can invest via the H-Shares
As for today's market, it should close at a day's low. We are most likely going to hit new lows (for this year) on all the major indices by week's end barring an intervention for which there appears to be no money on hand at the moment for one
Market bubbling up.
CNBC anchors panting heavily.
"Almost there... yeah.... yeah... right there... don't stop".
Price for oil goes down...
so follows the dollar revenues of gulf states...
so follows the amount they recycle into treasuries...
...putting upward pressure on interest rates...
...cutting into the US economy, decreasing oil demand...
[repeat]
From an Icelandic newspaper:
Í gær sagði Bos við fjölmiðla að seðlabanki Hollands hafi ekki fengið réttar upplýsingar um fjárhagsstöðu íslensku bankana frá Fjármálaeftirliti Íslands. Fjármálaeftirlitið íslenska sagði við seðlabanka Hollands að allt væri í góðu þar til yfir lauk, sagði Bos og bætti við: Við gætum endað fyrir dómstólum vegna þessa.
Yesterday, Wouter Bos, the dutch finance minister, said that the Dutch Central Bank did not receive the full/correct information regarding the financial health of Icelandic banks from the Icelandic Finance Ministry. "The Icelandic finance regulator told the Dutch CB that everything was fine until the end," Bos said, and he added "We might end up in court because of this."
Samkvæmt frétt hollenska ríkisútvarpsins nemur tap hollenskra skattgreiðenda 236,5 milljónum evra, jafnvirði nærri 36 milljarða króna en áður hafði komið fram að hollensk sveitarfélög hafi átt 59 milljónir evra inni á reikningum Icesave í Hollandi.
According to news from the dutch state radio, the losses to dutch taxpayers amounts to 236 million euros, but previously it was stated that dutch councils had 59 million euros in Icesave accounts.
Haft er eftir Wouter Bos, fjármálaráðherra Hollands að einstaklingar hafi átt á bilinu 1,6 til 1,7 milljarða evra inni á reikningum íslenskra banka í Hollandi og að þeir muni fá sparifé sitt til baka.
Woter Bos, Dutch finance minister, is reported to have said that individuals had 1.6 to 1.7 billion euros in icelandic banks in Holland, and they would get their deposits back.
http://www.mbl.is/mm/vidskipti/frettir/2008/10/16/hollendingar_hota_malsokn/
Iceland is in deep shit...but on the brighter side, Russians want to go and buy cars from Iceland as they are cheaper there at the moment...
We've hit the day's high
Steel
FCX
Op-ex tomorrow.
Gonna be fun, no ?
I stand by 1400 S&P at close.
Optimism is at the heart of confidence, so how do you fell about your favorite CEO today? Perhaps CR could also have some kind of a new confidence index, or is that in the VIX and TED?
Also see: Projection is a form of defense in which unwanted feelings are displaced onto another person, where they then appear as a threat from the external world. A common form of projection occurs when an individual, threatened by his own angry feelings, accuses another of harboring hostile thoughts.
damn man
X had a 25% swing today
insanity
NASDAQ's volume is so out of step that there might be a hostile takeover happening
Yes Virgina, there is a PPT...
Re: " people who actually think the PPT exists"
I don't believe in you, but yet I'm posting this, so go figure. What is reality?
eric-
your take on the 3:00 rallies?
We be jammin'
Ya mon....
OPEX is a huge deal. If the market doesn't rally between now and then, big transfer of wealth. That won't happen. All your OCT puts are belong to us.
National debt in Russia is only about 6% of GDP while in the US it's now about 80% or more. Russia has plenty of room to run up the national debt if need be.
Airlines, well all but Southwest, are up 25-30% in some crazy movement
No American airline has reported a profit yet, and I don't see how they can pretend that passenger volume/load factors are looking any better
eric-
i am serious.
you stated you worked for a hf, i would be interested what your opinion is of the 3:00 rallies the past 2 weeks.
you could set your clock by them.
these damn shorts. i saw even in the newest knight rider episode a criminal who was shorting a company stock. how unpatriotic xD
Also see: Projection is a form of defense in which unwanted derivatives are displaced onto another government's balance sheets, where they then appear as a threat from the external world.
A common outcome of projection occurs when an individual, threatened by his own evil government, begins harboring hostile thoughts.
It's a bear market; without foundation for rallies - it's a clear sell.
you stated you worked for a hf, i would be interested what your opinion is of the 3:00 rallies the past 2 weeks.
you could set your clock by them.
You mean like yesterday?
Seriously, if you think it's that easy, open up a futures account and buy spoos at 2:58, and sell them at the close.
Get back to me on how that works for you.
"The trend is your friend, until the end".
Terminal, inoperable Cancer found in only 3 of my major organs instead of 4: SLIGHT IMPROVEMENT
S&P 500 target for close, let's say 850 without worrying about precisio
Terminal, inoperable Cancer found in only 3 of my major organs instead of 4: SLIGHT IMPROVEMENT
The firing squad will only have 4 shooters instead of 5:
A LITTLE BETTER
Damn Henry, you are bold.
XLF just went neg agai
Looks like the rally is dead already
Now this is the kind of plunge protection I like to see.
eric-
you must be from the street...what a condescending dick.
Iceland actually might be lucky, first to enter into the economic hellhole and probably first to come out of it.
There are probably going to be whopping 50+ million former service sector workers unemployed in the USofA within next 18-24 months. They are the ones who kept that idiotic 70 percent GDP consumer economy going.
This is the endgame for the current form of USA. If USA were a person, even his accountant would be leaving TOWN just about RIGHT NOW.
This crisis is very similar to the Nordic banking crisis, except much worse. Bad news there just kept coming and coming for 2-3 years until the bottom was finally reached.
Shadow Banking & Lords Of Darkness Clues 1.01
Chicago Mercantile Exchange Holdings Q2 2007 Earnings Call Transcript 2007-07-24
Rick Redding
Yeah, open interest is something we do look at as one of the indicators of where potentially volumes can come from. Yeah, you would have to look at the particulars of where those option contracts have open interest is. A lot of it is in the nearby quarterly contract.
So, we think that portends good, well for volumes and not only that, as markets move it's also important because the underlying hedge is the futures contract and those traders will have a delta hedge using futures. So it's not just the fact that the options unwind, it's if the markets move you get the underlying trade, as well.
To be continued.... → → ♥®
Or maybe not. Not my day for predictions I guess.
Gordon Brown is my favorite politician, but this propping up of the inefficient, over-leveraged banking system is insane...how much are we all going to spend to cover up bankster mistakes?
National debt in UK is over 40% by official estimates and over 100% of GDP by some other estimates. This bailout just pushes it over the top!
And we spend our time glued to the stock-market as addicted gamblers waiting for a 'high' to make it all ok.
National debt UK
National Debt as a % of GDP has increased from 30% in 2002 to 36 % in 2007. This was despite the long period of economic expansion. It is primarily due to the governments decision to increase spending on health and education. There has also been a marked rise in social security spending.
National Debt has increased sharply in the past 12 months because of:
Slowing Economy (lower tax receipts, higher spending on unemployment benefits)
Although 43% of GDP is alot it is worth bearing in mind, that other countries have a much bigger problem. Japan for example had a National debt of 158% at the height of their recession. The US national debt is close to 65% of GDP.
National Debt and Financial Bailout
The Nationalisation of Bradford & Bingley and Government purchase of shares in major banks like HBOS will cause even more borrowing. It is estimated National debt will rise to 45% of National Debt by April 2009
It is way above the governments sustainable investment rule of 40% maximum
What is the Real Level of UK National Debt?
However, it is argued that UKs national debt is actually a lot higher. This is because national debt should include pension contributions which the government are obliged to pay.
The Centre for Policy Studies argues that the real national debt is actually £1,340 billion, which is 103.5 per cent of GDP. This figure includes all the public sector pension liabilities such as pensions, Private Finance Initiative contracts e.t.c (Northern Rock liabilities)
Another problem is that with the financial crisis, the government have added an extra £500bn of potential liabilities. Note: the Government has offered to back mortgage securities. They are unlikely to spend this money. But, in theory the government could be liable for extra debts of upto £500bn. If we include this bailout package as a contingent liability National debt would be over 100% of GDP.
George W. Bush stars in a remake of THE BOYS FROM BRAZIL, only has 4 clones however: SLIGHT IMPROVEMENT
Wow. If I hadn't gone to a good american university, I might think this market was rigged.
It seems to me that a good "cure" for the market would be forcing people to invest, rather than trade.
For example, requiring a 3 month minimum time frame before exiting an initiated position. It would decrease volatility, promote "investment" over trading, reduce deadweight loss on the part of Wall Street, and help with price discovery.
Granted, it might have an initial downward impact on equity prices, but I think it would be an improvement over the casino we have today.
whopping 50+ million former service sector workers unemployed in the USofA
Can't happen. Tipping point for a new government is a motivated 5-10% of active citizens, so 50 million pretty much puts Feds & DC out of business.
Gaveshire Hathaway,
I'm not looking to close out before today's end so I feel loose. I was expecting a zig zag pattern today, got the first peak, hit just after the day's low, then hit the next peak and have been waiting for it to plummet.
There's nothing out there to let the market pull away from Friday's low, so might as well go with common sense for now and wait them out.
...........
re: PPT,
More often than not it's just the name given to a phenomena which exists due to logical reasons at the individual level.
The Crash: Risk and Regulation
The Crash: Risk and Regulation - washingtonpost.com
I suggest you point your readers to a place where they can find the answer: Two shows done on NPR's "This American Life": Episode #355, "The Giant Pool of Money", which explains how the huge pool of investment money available worldwide provided incentives via mortgage backed securities that led to riskier and riskier mortgages being written over the last decade, tying huge amounts of risk to investors who thought they had "safe as money" investments, and Episode #365, "Another Frightening Show About the Economy", which explains how the derivatives and credit default swaps your article alludes to acted as an accelerant to the fire started by the mortgage crisis/US housing bubble, and also discusses whether the recent bailout package will have a chance to unfreeze the credit market (this being the occurrence that made economic experts in the government and private sector sit up and take notice of what was happening).
you must be from the street...
OK... in all seriousness.....
No, I don't think there's anything special about 3pm, with the exceptions that (a) sometimes margin selling happens then and (b) many mutual funds know at that point whether there's a net buy or sell due.
What's really going on is that people are reacting to a pattern that isn't really there. Humans are built to see patterns, even when there's no underlying cause.
And humans are also great at rationalizing things when the pattern gets broken: "oh, that doesn't count, because Ben announced a rate cut", "oh, that doesn't count becuase of options expiration", "oh, that doesn't count because GM announced earnings".
Now, that doesn't mean you, as a trader, can't make money off it. I personally think technical analysis is the worst kind of voodoo.... but.... if you watch the chart, and you see the X day average cross over the Y day average, and you know there's tons of sheeple following that, but your quote service is faster than theirs, it's free money (sort of.... until it doesn't work).
Sorry about being snippy. Does this answer help?
Gavshire Hathaway writes:
It seems to me that a good "cure" for the market would be forcing people to invest, rather than trade.
Paulson is way ahead of you. How are you liking your preferreds now?
I know I'm being a bit flippant, but what CR---respectfully---is calling 'a little better' or 'slight improvement', I wanna know for whom???
In a system as evil and corrupt as the FRACTIONAL RESERVE BANKING SYSTEM, any "improvement" in the conditions to ease lending---and therefore create MORE DEBT---is also evil and wrong!
How can we point to slight improvements when our system of banking creates handfuls of super-rich people and destroys the masses under piles of debt and servitude?
You cannot have slight improvements on a system that is terminally ill.
For example, requiring a 3 month minimum time frame before exiting an initiated position
Oh, yes, this would be most excellent.
The market would freeze instantly and die.
GH,
Capital controls?!
How about we jack up margin requirements first - what is the quote from the past - their games will stop when their credit is gone?
So, today the Dow drops 400 then zooms up 650--and the funny thing is, Bernanke thinks he's succeeded in "stabilizing" the market.
In honor of the PPT, I'll be burning this hear FAT bowl of green with my lunch.
Fire in the hole!
Or this 'here' (second bowl)
--
A term that born-and-bred American dopes never use (never heard from anyone in my 33+ years in America):
RETROGRESS.
Jas
This American Life Episode TranscriptProgram #355 The Giant Pool of Money
http://www.thislife.org/extras/radio/355_transcript.pdf
This was the magic of this whole system. You could take a pool of thousands of risky
mortgages, and create a security that was called money-good, as safe as any
investment out there. At least that's what people thought.
But now we know those agencies relied on the wrong data. That same historic data
that had nothing to do with these new kinds of mortgages.
Adam Davidson: And then things got even worse. The thing that took this problem
and turned it into a crisis was something else that was new, something called a
Collateralized Debt Obligation. A CDO. And that brings us back to the guy we met at
the awards dinner in the beginning, Jim Finkel.
Jim Finkel: Were heading to the trading floor of Dynamic Credit, where we
have all of our mortgage analysts, our head trader, our CIO.
Adam Davidson: Jim Finkel runs this CDO shop, Dynamic Credit. It takes up three
modified apartments on the upper East Side of Manhattan. The trading room is like a
factory floor for CDOs, its where they make the things.
Business Week lists the unlucky 13 nations that could follow Iceland
into a melting collapse. In its nations at risk the list contains some
of the usual suspects but a few surprises-
Pakistan
Argentina
Serbia
Turkey
Indonesia
Philippines
Vietnam
Romania
Kazakhstan
Latvia
Hungary
South Korea
New Zealand
Apologies are a rare treat on blogs - thanks Eric.
The S&P500 and the DJIA may be up by 1.7% but on the NYSE 86% of shares are down and 13% are up for the day
eric-
yes, it does, thanks, i do appreciate it. dick comment retracted.
i dont believe in the PPT, and IMO TA is marginally useful at best.
...and maybe its just that i ~want~ to see a pattern thats not there.
but the 3:00 thing for the last week or two has even become a meme here....makes me scratch my head
@Broward and citizen E
Broward - Agree, but we're going to freeze up soon anyway. Might as well install antivirus software before we reboot the machine...
Citizen E, -- Agree that reducing margin requirements would be a good thing. And it gets us to the same endpoint. Lower equity/asset/commodity prices.
In honor of the PPT, I'll be burning this hear FAT bowl of green with my lunch.
Fire in the hole!
Puff Puff give mother F'er
Good vibes....
Niiice.
I'll rip a binger for the love too.
Interview: Jim Finkel, CEO Dynamic Credit - Part I
by -- Revver Online Video Sharing Network
to doubt.. or not to doubt
does anyone question ?
and yet the market rises
but on what hope ... another fool ?
I think the reason people talk about 3 pm is that people care more about the close than what happens during the day. What happens in the last hour tends to get a lot of attention as a result.
Broken Condom,
where do you thing This Am Life got their information?
Check out the ubernerd section for better info.
... In its nations at risk the list contains some
of the usual suspects but a few surprises-
Pakistan
Argentina
Watch out for food prices to increase significantly if Argentina hits the skids.
The current oil price is - historically - still higher than at virtually any point in history bar the past 15 months. Considering that a few short years ago OPEC had an oil price target of $22-28 per barrel, I'd be very surprised if any of the major oil producers is anywhere near "major political turmoil" due to current prices.
Venezuela's public spending for 2009 is based on $60 dollar oil. Iran's budget is based on $55-$60 dollar oil. Saudi Arabia was $50 dollars (I think).
Oil companies are priced right now as if oil is going back under $40. I'm betting we stabilize between $50-$60. Oil at $50+ would be a "max pain" recession.
The market is rising for a simple reason offered to me by any number of colleagues: "buy stocks or homes now because they're cheap".
After a long and sustained runup, a decline in prices is seen by many humans as an opportunity, not an indication of some underlying flaw.
Ugh, I have to work on conference presentation for my MD on the credit crisis and the impact on aircraft financing, and he's taking the thesis that it will get better, the media is hyping a depression etc.
I just joined a few months ago, so I don't want to go all Jas on him, but he's making me look at signs of progress since all government intervention in the interbank market. This post isn't helping, but thanks CR for sticking to strictly looking at relevant data.
Anonymouse or Sebastian, you guys want to point out some positives?
A term that born-and-bred American dopes never use (never heard from anyone in my 33+ years in America):
RETROGRESS.
Fascist!
3:46 post was mine. Also, some ABS porn:
Asset Backed Alert - Asset Backed Securities - ABS Asset Backed Security - Four Zero Four
EHP,
I was just about to post on that - 6:1 decliners to advancers - some fine algorithms cranking the buys to jack that index and try to mitigate opex damage tomorrow is my WAG...but those are lousy internals any way you look at it.
Now, that doesn't mean you, as a trader, can't make money off it. I personally think technical analysis is the worst kind of voodoo.... but.... if you watch the chart, and you see the X day average cross over the Y day average, and you know there's tons of sheeple following that, but your quote service is faster than theirs, it's free money (sort of.... until it doesn't work).
Sorry about being snippy. Does this answer help?
Eric | 10.16.08 - 3:35 pm | #
I am not a trader; I am an engineer. I have come to the same conclusion. Technical analysis is just plain silly, but since enough people believe it (or act on it like trader Eric), it actually works sometimes.
It's a type of self-fulfilling prophesy.
Agree, but we're going to freeze up soon anyway
Most likely but I don't think it's guaranteed. My girlfriend asked me to explain what's happening in a simple analogy so I used this.....
There's a pile of money and over the past thirty years, it's been promised to five different guys who knonw nothing about each other. In 2008, hey all go to collect.
Who gets the money?
She thinks about it and says "why don't they just split it?"
And I said, "Why don't you just give 4/5ths of your retirement to some guy on the street?"
And then the lightbulb went off...
"But... but it's MY money".
hahahaha.
RE,
(actual) Inflation has been ~22% in Argentina due to some monkey-business and inflation-linked debt
Things have been on the skids. My roommate is from Argentina and it can be scary around now, but for now they just live with it. They've been dealing with fiscal problems for a decade
"A term that born-and-bred American dopes never use (never heard from anyone in my 33+ years in America):
RETROGRESS."
We're all Devo!
spread compression and Delta and mortgage quality leverage?
Retrogress, is that anything like impaired growth?
Andrew Sullivan:
Joe the Plumber has now had more press conferences than Sarah Palin.
Bwahahaha all your October put options are belong to us!
I'm a big fan of TIC data as an indicator. Dr. Setser is the master of that analysis -
The Crowd on Flickr - Photo Sharing!
had a blast at the Billionaires for Bailout Rally, danced with my peeps to the music of our visiting Italian marching band in the heart of Wall St, heckled the media and the crowd, hilarious. i bailed when nader took the mike, don't know why he was invited, ugh. no real pics yet, but this from a random tourist. will send video and such later.
The Crowd on Flickr - Photo Sharing!
I am not a trader; I am an engineer. I have come to the same conclusion. Technical analysis is just plain silly, but since enough people believe it (or act on it like trader Eric), it actually works sometimes.
At the hedge fund I used to work for, there was one summer where we were in a dry spell. If I remember correctly, our fund-of-fund investor had gotten some margin calls, and our books had been cut.
So we had some time on our hands.
Since we had oodles of data, and already had a whiz-band backtesting framework built, we decided to see if there was anything to T.A.
We went out and bought literally every book off the shelf at the local Barnes and Noble. We coded up every indicator.
We tried trading them straight out like the books presented. Over 15 years, over 2,000 stocks, none made money.
We then changed the program to allow it to fit each indicator to each stock. I didn't expect this to work. It didn't.
We coded up a meta-trader.... which would take the buy/sell indicators from multiple strategies. No dice.
Sure, you can make any strategy fit a chart, if you look for the right chart. That's not what makes money though.
I just ate a big greasy hambuger/pastrimi buger with fries and a coke...yum...did I miss anything?
Any guesses on GOOG earnings??
bp,
If Turkey melts down they will go into Iraq in a big way...just sayi
From the International Herald Tribune:
The New York Times - Breaking News, World News & Multimedia
BUDAPEST: The Hungarian government struck a deal Thursday to borrow up to €5 billion from the European Central Bank in a bid to avoid becoming - like Iceland - a national victim of the financial crisis.
Hungary is feeling the effects of the credit crisis not because its banks invested in bad mortgages, but because the markets have dried up, depriving it of the ability to service debts denominated in currencies other than the Hungarian forint.
Because interest rates in Hungary are relatively high at 8.5 percent, the majority of borrowers have taken loans in Swiss francs, euros or other currencies with lower interest rates.
Roughly 30 percent of Hungary's public debt and about 60 percent of loans to businesses and individuals are denominated in foreign currencies, making the country acutely vulnerable to a sinking forint.
Hungary also suffers from high public debt and anemic economic growth, scaring risk-averse investors and leading them to take their money out of the country. That puts the forint under even more pressure.
Sandor Jobbagy, a financial analyst at CIB Bank in Budapest, said that by borrowing the equivalent of up to $6.7 billion from the ECB, and talking earlier to the International Monetary Fund, policy makers were trying to scare off "those speculating on weaker Hungarian currency, to show that we have strong external support."
After a steep slide the previous day, the forint recovered some of its value Thursday, and was little changed against the euro and the dollar.
Andras Simor, governor of Central Bank of Hungary said the fundamentals of Hungarian economy have improved in the last two years.
"That doesn't mean we should sit back and say 'Let's wait until the international environment gets better again,"' Simor said. "We have to adjust ourselves to the new environment, and that is exactly what we are doing."
Though Hungary has solicited the advice of the IMF, it has resisted seeking money there, hoping to arrest the slide itself. "We maintain that this is a last resort," Janos Veres, the finance minister, said.
The ECB loan gives Hungary the means to meet its obligations directly even though harder currencies are flowing out, while tight credit markets mean that few banks want to put money into the country.
But the loan comes at a price. The Hungarian central bank had to deposit collateral, denominated in euros, with the ECB.
Addressing the underlying problems will be more difficult than taking a loan, analysts said.
Standard & Poor's, the ratings agency, put Hungary on review for a possible downgrade of its credit rating on Wednesday.
Slower growth takes a bite out of government revenues, and any hint that they are allowing deficits to grow again would put pressure on the currency. The government has said it will withdraw planned tax cuts and look for cuts in government spending.
The details of the new budget will be announced as soon as Saturday.
Hungary is in trouble because of overspending in the past. In 2006, the annual budget deficit reached 9.3 percent of the gross domestic product. While that is expected to fall to just 3.4 percent for 2008, the overall public debt is around 65 percent of gross domestic product.
Because the country has a strongly export-driven economy, the worldwide slowdown will hit hard. The government revised its expectation for growth this year to 1.8 percent, from 2.4 percent.
A spokesman for the Hungarian Financial Supervisory Authority said they conducted a comprehensive survey of the financial sector and found extremely low exposure to the mortgage crisis. The agency said it was monitoring the Hungarian banks closely.
"Figures show us day-to-day that the banks are stable, with more money paid in than they need to pay out," said Istvan Binder, the agency's spokesman. "The whole banking sector is in very good condition at the moment."
Famous last words!
Houston, we got a problem optimitis.
Jas
Jas Jain
CR, we got a problem -- Jaswant.
The Next Housing Catastrophe Waiting to Strike
The Next Housing Catastrophe Waiting to Strike (BAC)
Similar, yet so very different
Lower interest rates may have helped ease the pain inflicted on subprime borrowers with their adjusted reset rates, but option-ARM borrowers are in for a much bigger surprise because their mortgage rates don't just reset, they recast. This means that borrowers will have to start making full payments on the loan according to a 30-year-amortized schedule. In effect, Fitch Ratings expects the average monthly payment to jump 63%. Given that many borrowers are already defaulting on marginal increases in the minimum payments due, it seems likely the recasting will be catastrophic to most of these borrowers.
Don't say we didn't warn you
According to Huxley Somerville, a director at Fitch Ratings, $29 billion of these loans will reset by the end of 2009 and another $67 billion in 2010. The drastic increases anticipated on each loan are expected to cause delinquencies to more than double.
oops, didn't put Dr. Setser's analysis link -
Brad Setser: Follow the Money » Blog Archive » The mysterious August dollar rally; it wasn’t supported by any uptick in foreign demand for US assets
eek, tiny url version just in case.
Brad Setser: Follow the Money » Blog Archive » The mysterious August dollar rally; it wasn’t supported by any uptick in foreign demand for US assets
Up, Up, and AWAY!
booo yaaa
the worst is over
(lol)gack
EVP,
I agree but they had significant foreign inflows for agricultural production in the past few years.
If they collapse and even in the present circumstances, those inflows will be hugely reduced causing production to suffer significantly.
You may also remember the farmers strike several months ago.
No end in sight for Argentine farmers' strike - CNN.com
The pressure to use farm products for domestic use instead of exports is going to go up dramatically in such a scenario. Argentina has a solid history of instability and the farmers will not win this time round. Don't underestimate it.
Joe the Plumber has now had more press conferences than Sarah Palin.
km4 | 10.16.08 - 3:53 pm | #
Not the average campaign! Wonder what Obama will do in response?
Once upon a midnight dreary, while I pondered weak and weary,
Over many a quaint and curious volume of forgotten lore,
While I nodded, nearly napping, suddenly there came a tapping,
As of some one gently rapping, rapping at my chamber door.
'Tis some visitor,' I muttered,tapping at my chamber door -
Only this, and nothing more.
Business Week lists the unlucky 13 nations that could follow Iceland
into a melting collapse. In its nations at risk the list contains some
of the usual suspects but a few surprises-
A year from now North Korea is going to have the strongest economy in the world.
--
"I just joined a few months ago, so I don't want to go all Jas on him.."
alybaba,
Who wants to hear the truth anyway? Plus it would be bad for your business, or reputation.
Toe the party line and play safe. Play the game the American Way.
Jas
Ah, distinctly I remember it was in the bleak December,
And each separate dying ember wrought its ghost upon the floor.
Eagerly I wished the morrow; - vainly I had sought to borrow
From my books surcease of sorrow - sorrow for the lost Lenore -
For the rare and radiant maiden whom the angels named Lenore -
Nameless here for evermore.
And the silken sad uncertain rustling of each purple curtain
Thrilled me - filled me with fantastic terrors never felt before;
So that now, to still the beating of my heart, I stood repeating
`'Tis some visitor entreating entrance at my chamber door -
Some late visitor entreating entrance at my chamber door; -
This it is, and nothing more,
Eric is, of course, right.
Even if there were a PPT -- which there isn't -- why would they come storming in at the same time every day?
If you really think you see a pattern, why are you wasting time here instead of getting rich? Just lever up at 2:55 every day and exit before the close. If that does not work, then whatever pattern you think you see simply does not exist.
It is amazing the patterns people think they see in pure noise.
Lefty, those are Jimmy Choos. Tell the dog to get off the damn shoes!
Presently my soul grew stronger; hesitating then no longer,
Sir,' said I,or Madam, truly your forgiveness I implore;
But the fact is I was napping, and so gently you came rapping,
And so faintly you came tapping, tapping at my chamber door,
That I scarce was sure I heard you' - here I opened wide the door; -
Darkness there, and nothing more.
Edgar Allen Popeye?
RETROGRESS."
We're all Devo!
GD | 10.16.08 - 3:51 pm | #
Some of us are Madness.
In the middle of our street...
Nemo,
Amen. Could not have said it better.
-bh
Deep into that darkness peering, long I stood there wondering, fearing,
Doubting, dreaming dreams no mortal ever dared to dream before
But the silence was unbroken, and the darkness gave no token,
And the only word there spoken was the whispered word, Lenore!'
This I whispered, and an echo murmured back the word,Lenore!'
Merely this and nothing more.
Popeye, do you ever say anything useful?
CSC: Do you worry about your lungs?
It's a great poem - write your own ending.
"I just joined a few months ago, so I don't want to go all Jas on him."
You got it all wrong.
On this site calling somebody a dope ore a fascist intellectual neanderthal is like a hug or a friendly slap on the back.
dashingdwl: Yes. A lot. I mean to just eat it or vape, but I'm a stoner..so I haven't 'yet.
--
Americans are bred to love fascism (corporate law-and-order state); they just don't openly admit it. Denial is an emotion that comes easily to Americans.
Mussolini was extremely popular in 1930s Ameerica and some liked him lot better than FDR.
It's popularity is coming back lot sooner than you think.
Jas
That blows me away!!!
According to Huxley Somerville, a director at Fitch Ratings, $29 billion of these loans will reset by the end of 2009 and another $67 billion in 2010. The drastic increases anticipated on each loan are expected to cause delinquencies to more than double.
That was an awesome spectacle today
Well, I for one believe that this market is being pumped into OPEX. If this was a normal "rally" we'd see some people selling off hard into the close, not wanting to risk after hours earnings.
Of course the other scenario is that people have been tipped about the after hours results....
briwerk writes:
Popeye, do you ever say anything useful?
Last Friday, I was very useful - but you kinda had to be here at the time to understand the argument. Oh,.... and you had to sell when I did too.
Some good old real Americans singing our new national anthem:
YouTube -
I half-expected China to do a grand rendition as team USA entered Olympic Stadium.
Only a genius like me can be long SSO today and lose 7% sigh. That should teach me not to day trade: don't have the eyes and don't have the guts.
Gavshire Hathaway,
The impaired gains at airlines and banks reported today were in some cases beyond expectations. That is clearly a reason to break out the bubbly, and don't let anyone tell you otherwise
Eric,
Thanks for that comment about hedge fund experimentation. Whoever did it could probably write it up and get it published in an economics journal. After, of course, TSHTF, and they don't care about proprietary information anymore.
Well, damn. I guess good traders will have to go back to knowing a lot about 20,000 companies. Ha!
Popeye, all I heard was a lot of FEAR FEAR PUMP IT! And now Edgar Allen Poe.
New Post!
Who did all the buying today?
Gavshire Hathaway | 10.16.08 - 4:04 pm | #
Agreed. But it has ALOT more to go before those puts are nulled.
washingtonpost.com - nation, world, technology and Washington area news and headlines
Swiss Move to Stablilize Storied Banking System
"Authorities, with Federal Reserve's help, will move $60 billion in troubled assets from books of financial giant UBS to government-backed fund."
virtualco writes:
New Post!
Liar! You have now been banned
Could we get some Towels over at CNBC studio 6 the news anchors are all wet, and smoking cigarettes.
briwerk writes:
Popeye, all I heard was a lot of FEAR FEAR PUMP IT! And now Edgar Allen Poe.
Briwerk,
That's a pretty good summary of my market view. If you want market timing, you have to pay for it.
Gav, I hope you took advantage of this vix vol and sold some of them puts(short).
Popeye, how much does it cost for you just being quiet instead of polluting the comments with noise?
Who did all the buying today?
Joe The Plumber. He just finished a job for Dick Fuld.
Bernanke - criminal negligence
Paulson - criminal negligence, corruption
Greenspan - criminal negligence
MS, GS, Leh, others - fraud, conspiracy +++
I want to see some bald heads roll.
Agreed. But it has ALOT more to go before those puts are nulled.
Interesting Times | 10.16.08 - 4:07 pm | #
But how long until those nuts are pulled?
I was doing some reading about the Plaza Accord to find out about the regulatory and oversight failures that lead the Japan's bubble and Lost Decade and all I keep finding is stupid assessments like this:
The Plaza Accord was successful in reducing the US trade deficit with Western European nations but largely failed to fulfill its primary objective of alleviating the trade deficit with Japan because this deficit was due to structural rather than monetary conditions. US manufactured goods became more competitive in the exports market but were still largely unable to succeed in the Japanese domestic market due to Japan's structural restrictions on imports. The recessionary effects of the strengthened yen in Japan's export-dependent economy created an incentive for the expansionary monetary policies that led to the Japanese asset price bubble of the late 1980s.
These guys probably think that the rate cuts in 1927 caused the Great Depression too just because the stock market and credit exploded the moment they were implemented.
Well it's cheaper to bid up the market, if you can reliably do so because there are no guarantees, because it's expensive to try and net out options right now with gamma being huge
Also, no idea how this is playing out, but Citadel the options-trading king has funds in trouble
Last night I dreamed that I was at the zoo and I was looking across the moat into the hyena pen. The hyenas were ripping apart the carcass of '78 AMC Pacer (which I know doesn't make sense but it was a dream) and the people around me seemed to be enjoying themselves and every time the hyenas would rip off a piece of the car crowd would all shout 'Huzzah' like they were at the Renaissance Faire or something.
But then there was a guy in a suit in the pen with the hyenas and they started ripping him to pieces but he didn't seem to be made of anything. Then there were a whole bunch of guys in there and they were all getting ripped apart and they weren't made of anything either. Then the hyenas started ripping themselves apart, not each other but each one was eating itself, and then the people behind me started crying and screaming and I looked around and saw that some of them were turning into hyenas like the Dr. Pepper guy in An American Werewolf in London and I wondered why all of my pop culture references were like 30 years old.
But I was starting to panic and when I turned around again I was on the wrong side of the moat and all of a sudden this shit wasn't funny anymore.
So then I woke up face down on my keyboard and when I looked in the mirror there was a little square with an F5 in the middle of my forehead and I thought "so what? it's only a dream."
Weird.
briwerk,
The cost is simple. You post several intelligent comments. I'll listen carefully.
briwerk,
You have my full attention. Go for it.
That hurt, man. I was hoping so much to get onto a new one, like right now.
It amuses me to see these comments about there being no PPT. However, I am not saying that it is the PPT that causes the 3:00pm rallies or that it is the PPT that consistently causes rallies and or declines.
However, with politicians talking about markets needing to be stabilized every hour, every day and the SEC stopping short selling, there clearly is government intervention in the markets.
Now the question is just to what degree and at which point there is intervention. Lately it has gone as far the president timing his speeches with market events. Now does anybody seriously believe that NO financial intervention takes place? Give me a break.
Reality is that a further falling stock market and its attendant consequences for pension funds, consumer purchasing power, economic confidence, etc is a huge risk to the stability of the country. When toxic financial instruments are bought by the government to OVERTLY influence bank stock prices, it seems utterly silly to think that there is no short term intervention to influence market psychology. It is much cheaper than spending billions giving a confidence boost this way than to purchase dead MBS.
Last Friday, I was very useful...
Please, no sex stories.
I have to admit, I thought you were a kook. Now I think you're a lucky kook. I did thread-the-needle, too, for awhile but then...
Ahhh got burned pa.
Burned real bad.
My daughter and I went to a very large thrift store down the road. I like the deals on books and music. She likes dressing like it is 1964. I even got an album with the 1949 recording of Billies "Strange Fruit!"
I like this store because I use it as an economic indicator. Today it was 40% Hispanic, 50% white, and the rest was the usual UN crowd. A year ago it was 10-15% white. Also it has 29 cashiers. All 29 were busy.
Briwerk,
Please post your argument or stupidity. I'm not sure which.
New post dudes.
Popeye, the argument is that you generate worthless noise in the comments. Please stop it.
Briwerk - feel free to post here or on the next thread. Your choice.
briwerk,
and your point of contribution is what ???
briwerk
what have you contributed ??
Ommmmmmmmm
Anonymous writes:
Joe the Plumber has now had more press conferences than Sarah Palin.
km4 | 10.16.08 - 3:53 pm | #
Not the average campaign! Wonder what Obama will do in response?"
The "balloons" that Mc Cain has been "floating", whether full of air or full of mud, have had a way to crash short of their target... and wipe out some points in voters opinion.
Obama does not need to do anything.
Funny:
`Joe the Plumber,' Obama Tax-Plan Critic, Owes Taxes
`Joe the Plumber,' Obama Tax-Plan Critic, Owes Taxes (Update2) - Bloomberg.com
"No American airline has reported a profit yet, and I don't see how they can pretend that passenger volume/load factors are looking any better"
They are shrinking their way to prosperity - volume down but LOAD FACTOR way up. Works until 100% LF is still not break even at the prevailing fare, a circumstance they just won't contemplate. Not there yet.
sparky,
What is the matrix?
Obama does not need to do anything.
Caution: Objects in rear-view mirrow may be closer than they appear.
It's practically Friday night, and my aesthetic has evolved over the week from Motown to Courtesy of Motown.
Piece of something ...
YouTube - Lil Wayne -Way Of Life (ft Big Tymers and TQ)
Nice post CR, as always.
Broward Horne writes:
whopping 50+ million former service sector workers unemployed in the USofA
Are they legal or illegal workers?
What does this mean for the top 10% of employers who depend on these workers?
It is important to know just who is doing the dirty work.