STOCK MARKET WATCH, Friday September 7

Source: du

Friday September 7, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 503 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2436 DAYS
WHERE'S OSAMA BIN-LADEN? 2148 DAYS
DAYS SINCE ENRON COLLAPSE = 2109
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 10
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

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U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES

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AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON September 6, 2007

Dow... 13,363.35 +57.88 (+0.44%)
Nasdaq... 2,614.32 +8.37 (+0.32%)
S&P 500... 1,478.55 +6.26 (+0.43%)
Gold future... 704.60 +13.90 (+1.97%)
30-Year Bond 4.79% +0.01 (+0.21%)
10-Yr Bond... 4.50% +0.03 (+0.60%)






GOLD, EURO, YEN, Loonie and Silver

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PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact actionpost@legitgov.org

For information on protests and other actions Citizens For Legitimate Government

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More Radical Fringe here


Read more: du

Large Financial Institutions' Technical Analysis
BY MARTIN GOLDBERG, CMT

The rhetoric today pertains to sub-prime, alt-A and other potentially bad mortgage debt. Fundamentally these topics provide the foundation for a large wall of legitimate worry. What were the main drivers of the current bull market in US stocks? To be sure, the development of emergency markets’ economies played an important roll for industrial companies in the US. But as we look at the US market, what industries have stood out as the real stars during the time of the last bull run? If it was technology in the late 1990’s, the stars of this US bull market have been financials, US consumer products and services related companies. However, now the US consumer seems to be spent. If this is not apparent, you may reference recent disappointing results from the likes of Wal-Mart, J.C. Penney, Costco, Brunswick, and Sears to name a few. Also reference results from the homebuilders which were just horrible.

If you think that Fed action is going to cause anything beyond a relatively short knee-jerk rally, think again. As you will see tonight the charts of financial companies are saying that something pretty ugly is developing in the US economy. As of this day, Fed easing of short term rates are pretty much discounted in the action of the stock market and this news cannot get any better. It is therefore timely to examine the technical charts of financial companies now – when the news cannot get any better.

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Today’s Market

Today’s market contributed to the recent market rally on diminishing volume as all indices were up, although there was little conviction behind the rally. The action tomorrow will be more important than today with the government putting out economic data. An important aspect of the market and economy is the behavior of the US consumer. The conventional wisdom over the last few years has been that the “high end” consumer is immune from the difficulties in the real estate and mortgage markets since the high end is doing so well. This reasoning has been used by many on Wall Street to sell high end retail stocks to the public.

http://www.financialsense.com/Market/wrapup.htm

8:30 AM Nonfarm Payrolls Aug
Briefing Forecast 130K
Market Expects 110K
Prior 92K

8:30 AM Unemployment Rate Aug
Briefing Forecast 4.7%
Market Expects 4.6%
Prior 4.6%

8:30 AM Hourly Earnings Aug
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.3%

8:30 AM Average Workweek Aug
Briefing Forecast 33.8
Market Expects 33.8
Prior 33.8

10:00 AM Wholesale Inventories Jul
Briefing Forecast 0.5%
Market Expects 0.5%
Prior 0.5%

http://biz.yahoo.com/c/e.html

01. U.S. Aug. average workweek steady to 33.8 hours
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

02. U.S. Aug. average hourly earnings up 0.3%, up 3.9% yr-on-yr
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

03. U.S. Aug. retail jobs up 13,000
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

04. U.S. Aug. government jobs down 28,000
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

05. U.S. Aug. construction jobs down 22,000
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

06. U.S. Aug. factory jobs down 46,000, biggest since July '03
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

07. U.S. July nonfarm payrolls up rev 68,000 vs 92,000 prev
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

08. U.S. Aug. unemployment rate holds steady at 4.6%
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

09. U.S. Aug. nonfarm payroll first drop since Aug. 2003
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

10. U.S. Aug. nonfarm payrolls down 4,000 vs up 115,000 expected
8:30 AM ET, Sep 07, 2007 - 40 seconds ago

just had to post the bulletin headline from CBSMarketwatch - I guess those eCONomists have their cheerleading outfits on again. :eyes:

3:40 into the video to get right to "voodoo economics"

http://www.youtube.com/watch?v=zSA22rVJg6g

:spray: now YOU owe me a monitor.

O8)

(I'm just glad youtube came through)


It was a fun movie.

01. White House's Lazear: Slowdown in hiring 'not alarming'
9:39 AM ET, Sep 07, 2007 - 1 minute ago

I *really* need to update my jobs spreadsheet/graphs.

I'll do that when I get home tonight.

14. U.S. June wholesale inventories rise revised 0.3%
10:00 AM ET, Sep 07, 2007 - 2 hours ago

15. U.S. July wholesale petroleum sales rise 1.5%
10:00 AM ET, Sep 07, 2007 - 2 hours ago

16. U.S. July wholesale petroleum inventories fall 0.1%
10:00 AM ET, Sep 07, 2007 - 2 hours ago

17. U.S. July wholesale sales rise 0.1%
10:00 AM ET, Sep 07, 2007 - 2 hours ago

18. U.S. July wholesale inventories rise 0.2%
10:00 AM ET, Sep 07, 2007 - 2 hours ago

12. ECRI weekly leading index slows to 0.6% vs. 6.1% month ago
10:33 AM ET, Sep 07, 2007 - 1 hour ago

SINGAPORE - Oil prices held steady Friday after U.S. government data showed a larger-than-expected decline in domestic crude stocks.

Light, sweet crude for October delivery slipped 5 cents to $76.25 a barrel in Asian electronic trading on the New York Mercantile Exchange at mid-afternoon in Singapore. The contract added 57 cents to settle at $76.30 a barrel Thursday.

In its weekly inventory report, the U.S. Energy Department's Energy Information Administration said crude oil inventories fell by 3.9 million barrels in the week that ended Aug. 31., more than tripling analysts' average prediction of a 1.1 million barrel decline.

Gasoline inventories fell by 1.5 million barrels, slightly more than the 1.1 million barrel decline analysts surveyed by Dow Jones Newswires had expected.

http://news.yahoo.com/s/ap/oil_prices

WASHINGTON (Reuters) - The rate of home loans in foreclosure rose to a record high in the second quarter of 2007 as more homeowners in California, Florida and other states could not refinance their adjustable-rate mortgages, a trade group said on Thursday.

The Mortgage Bankers Association said 0.65 percent of loans entered the foreclosure process on a seasonally adjusted basis, 7 basis points higher than the previous quarter and up 22 basis points from a year earlier.

It was the third straight quarter in which the foreclosure rate rose to a record-setting level and the worst is likely still ahead, the MBA said.

http://news.yahoo.com/s/nm/20070906/bs_nm/usa_housing_delinquencies_dc

http://www.kitco.com/ind/Schiff/sep072007.html

Now that home mortgage defaults are spreading like wildfire from coast to coast, there is a growing sense of certainty that the government will attempt to bail out homeowners and lenders. The ideas put forward last week by President Bush may be the camel’s nose pushing under the bottom of the tent. However, just as some things are too big to fail, this problem is far too big to fix.

First of all, one has to consider the moral hazards inherent in any bailout. Immediate relief in the form of debt reductions and more favorable loan terms will create a powerful incentive to default. Why would anyone stretch to make a burdensome mortgage payment while others are being rewarded for failing to make theirs?

Even without the incentives of a government bailout luring more people into default, policy makers simply have no idea as to the scope of the problem. Before this home mortgage correction runs its course, nearly every homeowner in the country who had availed themselves of an adjustable rate mortgage or a home equity loan will be in need of a bailout. Even a sizable percentage of those with traditional fixed rate mortgages will find themselves in danger. With millions, or perhaps tens of millions, of home owners on the rocks, there is simply no way the government can structure a bailout without bankrupting the country or destroying the currency.

more...

NEW YORK (MarketWatch) -- Back-to-school purchases and luxury shopping fueled U.S. retail chains' better-than-expected August sales, defying a widespread concern that a slowing housing market and a credit crunch would crimp consumer spending.

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Later back-to-school start dates and deferred sales-tax-free shopping periods in states such as Florida and Texas spurred purchases during the month, while designer fashions and accessories helped lead continued demand for luxury goods. The gains in August, the largest month of the back-to-school period, may translate into better-than-expected holiday sales, investors said.

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Despite the better-than-expected gains, sales, however, are still expected to slow from a year earlier as housing concerns and subprime-mortgage problems have hurt sales of home-related goods and made people feel less well-off, analysts said. Some of the sales gains may also have been driven by discounts, which may hurt profit, they said.

-cut-

U.S. retailers posted a 3.1% gain in same-store sales, better than an original estimate of a 2.5% increase. That compared against a 3.9% advance a year earlier, according to Thomson Financial.

http://www.marketwatch.com/news/story/back-to-school-luxury-shopping-lifts-august/story.aspx?guid=%7B03848661%2D748F%2D4C50%2D8031%2DD823DDEC0364%7D&dist=SecMostRead

LONDON (MarketWatch) -- U.S. stock futures declined Friday ahead of the release of the key monthly employment report, with Harley-Davidson slashing its earnings forecast and former Federal Reserve Chairman Alan Greenspan saying he sees parallels between the current situation and the stock-market crash of 1987.
S&P 500 futures fell 7.1 points at 1,472.50 and Nasdaq 100 futures dropped 11.25 points at 1,992.50. Dow industrial futures fell 53 points.

U.S. stocks closed with modest gains on Thursday, as economic reports helped to quell concerns about a hard landing. Many of the retailers rose on the back of better-than-forecast August same-store sales, while Apple declined on continued concerns about the iPhone price cut. The Dow industrials rose 57 points, the S&P 500 rose 6 points and the Nasdaq Composite added 8 points.

The focus on Friday will be the monthly payrolls report, due out at 8:30 a.m. Eastern, and markets could conceivably prefer a number showing a weak reading, as it would remove one stumbling block to a rate cut by the Federal Reserve.

-cut-

Also on the economy, Treasury Secretary Henry Paulson said Thursday in a televised interview that strains in global credit markets could take months to work out as the markets reassess the price of risk.

Greenspan meanwhile told a conference that the current market turmoil resembles 1987 and 1998.

http://www.marketwatch.com/news/story/back-to-school-luxury-shopping-lifts-august/~/Indications?dist=morenews_ts

At the beginning of the year, HSBC seemed a prime target for shareholder activism. The banking group, which had grown into the world's fourth-largest financial institution through a series of audacious acquisitions, seemed to have lost its way.

HSBC had just issued the first profits warning in its modern history, the result of a foolish bet on US sub-prime mortgages that had prompted investors to question the bank's strategy and its ability to manage far-flung operations.

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Its attempt to break into the bulge bracket of global investment banking also appeared to be an expensive mistake. HSBC's traditional share price premium over the UK banking sector had all but disappeared, as the markets questioned the effectiveness of large universal banks.

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Perhaps most importantly, the global liquidity crisis has given investors a new-found appreciation for HSBC's size, geographic spread and powerful balance sheet. Its shares, which had underperformed the rest of the sector for several years, have held up reasonably well in the market turmoil.

In this context Eric Knight, the activist shareholder who is due to call for a "fundamental review" of HSBC's strategy, would appear to have launched his campaign a few months too late.

http://news.yahoo.com/s/ft/20070906/bs_ft/fto090620071727202042

Greenspan sees turmoil similar to 1987, 1998: report

NEW YORK (Reuters) - Former Federal Reserve Chairman Alan Greenspan said the current market turmoil is "identical" in many ways to that which occurred in 1987 and 1998, the Wall Street Journal reported in its online edition on Friday.

"The behavior in what we are observing in the last seven weeks is identical in many respects to what we saw in 1998, what we saw in the stock-market crash of 1987," Greenspan was quoted by the newspaper as saying.

He made the comment on Thursday at an event in Washington organized by the Brookings Papers on Economic Activity, an academic journal, the report said.

Greenspan, now a consultant but who was Fed chairman from 1987 to 2005, said business expansions are driven by euphoria and contractions by fear, the report said.

While economists tend to think the same factors drive expansions and contractions, "the expansion phase of the economy is quite different, and fear as a driver, which is going on today, is far more potent than euphoria," the report said.

http://news.yahoo.com/s/nm/20070907/bs_nm/greenspan_market_dc

http://www.economist.com/finance/displaystory.cfm?story_id=9769296

“NOT only is there no God,” said Woody Allen, “but try getting a plumber on weekends.” That just about sums up the problems of today's financial markets. The plumbing is badly blocked, and nobody seems able to fix it, not even the central banks, the market's immortals.

The problem is the apparent reluctance of banks to lend to each other, particularly over three months. That problem arises, in part, from uncertainty about who will pay the bill for America's subprime-mortgage collapse. But it also results from the need for banks to protect their own balance-sheets in the face of some unexpected claims on their capital.

The result is that banks are paying much more to borrow than normal, particularly compared with governments. According to Goldman Sachs, one measure of this gap between American Treasury bills and interbank rates, nicknamed the “Ted spread”, is at a 20-year high. And like other plumbing problems, this could have severe consequences, because when banks pay more to borrow they pass the cost on to consumers and companies.

On September 5th the Bank of England got its monkey wrench out and tackled one issue, the half-percentage-point gap between overnight lending rates and its official benchmark. The Bank promised to lend more money to the market, if necessary, to bring overnight rates down.

Critics argue that the Bank has been time-wasting. The European Central Bank and the Federal Reserve made similar moves last month, and the ECB did so again on September 6th. But the Bank of England's failure to act sooner seems to be part of a general reluctance to be seen to be saving speculators from their mistakes. The Bank made it clear that it was not aiming to bring down three-month lending rates, which are the markets' most acute pressure point. A bank may be good for its money in the morning, but who knows what will have happened by December?

Perhaps central banks cannot solve the problem on their own anyway. They have offered to provide finance to any bank that needs it via mechanisms such as the discount window operated by the Federal Reserve. But banks are understandably reluctant to show any hint of desperation. Borrowing from a central bank in the middle of a liquidity crisis is rather like a schoolboy agreeing to have a sign saying “Kick me” pinned to his shirt-tails.

more...

:donut: and lurkers. Hearing Greenspins utterings reminds me of of an old joke. An elderly man goes to the Doc because he notices he has a discharge coming from his penis. The Doc looks at his penis and asks 'Did you have sex recently'. The elderly man admits that yes, he did have sex but that was over a week ago. 'well, you better get back there' says the Doc, 'because I think you're coming'.:spray:

Much like our elderly patient, the time for Meanspin to say something relevant was in 1987 and 1998. As far as that stain on our moral conscious, he should have been pitched out with that old blue dress-he is just as relevant. These 'pronouncements' are nothing more than the impotent dribblings of an impotent old man that can't give up his powers and go into a graceful retirement.

I just can't help but think of how much he did to 'wrecktify' the situations in 87 and 99. I managed to move my money around so as not to lose much in 87-but the economy was so bad I had to cannibalize my investments to survive. And 99, I lost 1/4+ of my hard earned principal and almost all of my gains thanks to his screwing with the money. Frankly, I have had enough of him. I would love to know what Chopper Ben really thinks of the situation he was left with and what he really thinks of Greenspin.

I also think it was interesting that they threw out that thing about the Russian economic collapse. I think that might be worth further researching. I wasn't as keen on economics so I am a bit fuzzy as to the specifics on that deal.

Look at the time, I got to discuss penis' and dicks before my first cup of coffee. What I really need is a wooden stake and a necklace of garlic. It's going to be an interesting day.:rofl:

Happy hunting and watch out for the bears.

as a productive day when I can make someone spew. :evilgrin: :smoke:

I do not like you, Spam-I-Am, I do not like green eggs and ham.

Or maybe 10,000 times worse than 1987. We won't know until we come out the other side, if we ever do.

NEW YORK (Reuters) - Countrywide Financial Corp (CFC.N) shares on Thursday fell below the $18 price at which Bank of America Corp (BAC.N) may convert its $2 billion investment into common stock.

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Bank of America, the second-largest U.S. bank, on August 22 bought preferred stock yielding 7.25 percent, convertible into common stock at $18.

Investors said that reflected confidence that Countrywide, the largest U.S. mortgage lender, could survive a liquidity shortage resulting from investor resistance to buying its loans and debt. Countrywide shares rose as high as $24.24 the next day, giving Bank of America a large paper profit.

-cut-

Shares of Countrywide fell as low as $17.95 in morning trading. They closed down 33 cents, or 1.8 percent, at $18.48 on the New York Stock Exchange, and are down 56 percent this year.

http://news.yahoo.com/s/nm/20070906/bs_nm/countrywide_bankofamerica_dc

This is rather distrurbing....the MSM usually doesn't mention PM and safety in the same breath. They do manage to tone it back down in the end.

http://www.bloomberg.com/apps/news?pid=20601087&sid=auHgp4QIbuUs&refer=home

Sept. 7 (Bloomberg) -- Gold rose to its highest since May 2006 on signs turmoil in credit markets is increasing demand for the safety of the metal. Silver also gained.

Gold was set for its biggest weekly advance in more than 10 months after investment in StreetTracks Gold Trust, the biggest exchange-traded fund backed by the metal, rose to a record. New York futures yesterday gained above $700 for the first time in almost 16 months. The dollar slid against all but one of the 10 most active currencies this week as the credit rout spreads.

``This is not a flight from the U.S. dollar but from currencies generally,'' Dennis Gartman, trader and editor of the Virginia, U.S.-based Gartman Letter, wrote in his daily report today. ``Gold has broken out'' to higher levels.

snip>

In London, gold held below $700 today, and the 10:30 a.m. fixing rate used by some mining companies to price sales of the metal gained $11.50 to $695 an ounce.

``Gold prices have benefited recently from the weakening dollar and we don't think that's going to extend further,'' said Tobias Merath, an analyst at Credit Suisse Group in Zurich.

Jewelers, the biggest buyers, ``have been important to the overall move higher and will have backed off for now,'' Michael Jansen, an analyst at JPMorgan Securities Ltd. in London, wrote in a report published today. ``The market could retreat toward $670 an ounce.''

more...

02. December gold up $4.10 at $708.70 an ounce on Nymex
8:24 AM ET, Sep 07, 2007 - 4 minutes ago

From Fred Starkey's Technical Report:

"Something of significance took place in the Gold Market. Open Interest had fallen off dramatically; from 425,700 in May to 322,520 in August. But, the option open interest was 2:1 from the long side basis the October and December contracts. The bulls are betting by 2:1, basis the October contract, that Gold will reach at least 740.00. Basis the December contract the increase in open interest is up 300% since October. The bulls also outnumber the bears by 2:1. These call positions are betting on Gold reaching $1,100.00 or higher. This fits with the ratio of Gold to Crude Oil, which is currently at 9.100. If it was to reach its’ normal 15:1 ratio, then Gold would reach $1,200.00."

by selling gold reserves. I don't think they can fight this tsunami, however. The more they dump, the more we'll buy.

05. Dec. gold contract taps its highest level since late April
9:44 AM ET, Sep 07, 2007 - 5 minutes ago

06. Dec. gold up $10.80 at $715.40/oz after a $716.50 high
9:44 AM ET, Sep 07, 2007 - 5 minutes ago

07. Dec. silver gains 1.8%, or 22.7 cents to $12.76/oz
9:44 AM ET, Sep 07, 2007 - 5 minutes ago

08. Dec. copper down 0.9%, or 2.85 cents, at $3.274/lb
9:44 AM ET, Sep 07, 2007 - 5 minutes ago

http://www.kitco.com/ind/Willie/sep072007.html

A certain nerve has been struck a few times in recent reading on my part by the description of the USDollar as a subprime currency. How true!!! When a debtor has poor credit history, inadequate income, and shoddy assets, the borrower is deemed to be subprime, which means less than good, not up to snuff, of second rate standard. The entire world is growing in its disgust for having been defrauded. While US banking and economic leaders are smugly claiming containment of the problem, foreign officials are acting according to the opposite conclusion. Every single denial of the problem, whether from press pundits, corporate titans, banking officials, government ministers, agency heads, trade representatives, and central bankers, has been incorrect. My article of this June entitled “Absolute Bond Contagion” (click here) might have seemed like a wild-eyed universally indictment, but now we see that the contagion is spreading in almost every conceivable bond cranny on a global basis. The contagion seems absolute in more clear fashion. At risk next are commercial mortgages and corporate bonds in the immediate crosshairs of trouble. Foreign banks are clearly affected in profound ways, the extent of which will have to be seen. French, British, German, Japanese, and Chinese banks have been harmed from ingesting falsely labeled food items. What was sold as ‘AAA’ rated milk products was actually highly toxic acid, more suitable for cleaning automotive grease and other industrial coatings than entering delicate human digestive systems. Heck, that milk aint even homogenized, but rather has layers of fat, scum, heavy acid, even mold.

While US-based players and coaches display a cocky swagger that all will work out just fine, that credit supply will continue endlessly, foreigners might be in the early stages of calling for a boycott of US$-based financial assets. It started with subprime mortgages and their incredibly flawed credit derivatives called collateralized debt obligations. These CDO products are the wares of conmen, fraud artists, and hucksters. The next step is for other US$-based debt securities to face a gradual shun. Such bonds peddled by American shell game criminals cannot be trusted by foreigners who have valuable savings. In 1999 they were burned with overpriced tech, telecom and dotcom stocks whose values were suspect, whose forward earnings guidance was absurd, whose PE ratios were lofty. In the case of the dotcom stocks, their value models were nonsensical, based upon eyeballs, clicks, and sticky websites, and not tried & true fundamentals. This bond debacle fraud perpetrated upon the world is 50 to 100 times larger, in an extreme display of financial crime worthy of the description, Weapons of Mass Destruction. The conspiracy among Wall Street, the US Federal Reserve, and Debt Rating Agencies involved the sale of asset-backed bonds which very clearly, vividly, and lethally constituted weapons that dole out mass destruction to banking systems. The most obvious victim is the US banking system, whose problems are far from over.

GOLD SURPASSES 700 MARK

Many signals are flashing positive for gold lately. Gigantic futures options point to professionals anticipating a substantial move up in the gold price this autumn, probably early autumn. These bets are not placed by amateurs, and they do not stand as contrary indictors. Here were are, only three trading past the Labor Day holiday, and gold has jumped past 700. The 3-month USTreasury Bill yield remains a full 1% below 5.25% and the Fed Funds target. The corporate bond yield spreads are showing distress, the B-rated yield much higher than the AAA-rated yield. The USFed is stuck on policy. They must address the problem of overnight bank loan rates being out of whack, where money for intra-bank loans is too expensive to meet demand. Gold has responded also to statements made by the Euro Central Bank today, as they announced no rate hike, but stern vigilance for monitoring inflation. In other words, they stand ready to hike soon again. They nodded in respect to the USFed, giving their beleaguered colleagues a pass.

more...

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

Last trade 80.458 Change -0.001 (-0.00%)

August Non-Farm Payrolls: What to Expect for the US Dollar

http://www.dailyfx.com/story/topheadline/August_Non_Farm_Payrolls__What_to_1189102485077.html

This Friday, we are expecting August Non-farm payrolls and now more than ever, the stability of the US economy hinges on the strength of the labor market. The amount of job growth last month will help the Federal Reserve decide between leaving the interest rate unchanged and cutting it by 25 or even 50bp. The recently weak economic data and sharp movements in the bond markets have boosted the risk of a recession, causing the US dollar to lose its luster as a safe haven currency. If job growth last month is less than 100k, then the risk of a recession becomes very real, but if it is greater than 100k, calm could be restored in the financial markets, at least for the time being.

With the vulnerability of the housing market has become increasingly apparent, US growth is at serious risk. Pending home sales, which is a leading indicator for home sales dropped 12 percent in the month of July. According to the Mortgage Bankers Association, foreclosures also rose to a record level in the second quarter as one out of every seven loans was delinquent. Adjustable rate mortgages are rising, putting a strain on homeowners as well as mortgage lenders who are faced with defaults. Investors with exposure to these loans have faced major losses of their own, resulting in bankruptcies, fund closures and an overall flight to safety. It has been argued by many Federal Reserve officials and Fed watchers that a rate cut may not be needed because the impact of the subprime and credit crisis on the real economy has been limited. However recent economic data has suggested otherwise and non-farm payrolls could really drive that point home. A sharp drop in job growth would mean that consumer spending could deteriorate materially since a sustained drop in spending is the main ingredient to a recession. That is why tomorrow’s NFP number is so important.

What US Dollar Traders Should Watch

Over the past few weeks, we have seen the dollar rally on weak US economic data as both domestic and international traders flocked to the safety of US treasuries. However the lack of a rally in the currency on Wednesday and Thursday despite weaker US economic data suggests that the economic outlook could be so uncertain that even international traders are looking to parking their money elsewhere while domestic traders move back into cash. A weak non-farm payrolls number would give them an even greater reason to invest in countries that are performing better, such as the UK and Australia. Right now the market consensus is for companies to add 100k jobs so a dollar bearish number would probably be anything below last month’s 92k rise. Job growth in excess of 125k on the other hand would be positive for the dollar. Of the 87 economists surveyed by Bloomberg, the most optimistic forecast is for 140k job growth while the most pessimistic is 35k. As usual, keep an eye out for revisions to the July figure because we have seen revisions to prior payroll numbers exacerbate or negate the surprise in the current month’s headline report. If both the headline and revised number turns out to be dollar negative, watch out because traders will pounce on the idea of sharply slower consumer spending and growth this quarter. Let’s take a look at what the market is expecting tomorrow:

...more...

Yen Firms as Fears Grow NFP Will Be Weak-End of the Carry Cycle?

http://www.dailyfx.com/story/bio2/Yen_Firms_as_Fears_Grow_1189160007582.html

In a very quiet lackluster session – typical of pre-NFP night – the yen firmed in Asian and early European trade as Japanese investors repatriated funds home ahead of the October fiscal year end.

Talking Points

• Japanese Yen: Firmer as KAMPO rumored to have repatriated
• Euro: ECB will be data dependent
• Pound: trades strictly off carry flows
• Dollar: NFP holds the focus

In a very quiet lackluster session – typical of pre-NFP night – the yen firmed in Asian and early European trade as Japanese investors repatriated funds home ahead of the October fiscal year end. Friday night flows were dominated mainly by technical factors as economic calendar remained light

One other theme that may be starting to form in the currency market is that we may witnessing the first signs of the end of the global tightening cycle in rates. The uniform message from G10 central bankers this week was that liquidity was paramount as capital markets continued to grapple with the problems of credit. Even those central banks whose economies have performed extraordinarily well such as Australia and UK have been circumspect in their rhetoric preferring to err of the side of caution for the time being.

It’s too early to tell whether this is simply a pause or a definitive stop in the global monetary tightening cycle. Certainly one gets the sense that most of the G10 monetary authorities would like to hike rates further especially given the double digit growth in M3 monetary aggregates in both EZ and UK. However, the policy makers remain on the defensive due to the unrest in the markets. Indeed we think they will have to no choice but to be reactive rather than proactive, as investors deal with the growing losses in the sub-prime debt market and the concomitant problems of confidence in the money markets as key participants continue to be risk averse.

...more...

:scared:

Wild ride today...

http://www.kitco.com/market/index.html


:wow:

That was fast...
Hold on to your hats...Something wicked this way comes...

Watching CNBC is hysterical...The one word that everyone they are putting on is saying... THIS IS BAD NEWS!

jeeze

dropping like a rock...Nikkie going down also...

Last trade 79.915 Change -0.544 (-0.68%)

Settle Time 15:00 Open 80.454

Previous Close 80.459 High 80.569

Low 79.841 2007-09-07 09:46:01, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.958 52wk Low Date 2007-08-06

Nuttin here....
http://www.frbatlanta.org/invoke.cfm?objectid=E4DCDB6F-4F9C-11D5-93360020352A7A95&method=display

Or here....
http://www.frbatlanta.org/invoke.cfm?objectid=B1E4409C-9366-4C47-8E696A428AE0D746&method=display

Hmmm, not even in the mid 90's

http://www.reuters.com/article/hotStocksNews/idUSN0634655920070907

NEW YORK (Reuters) - The dollar hit a 15-year low against major currencies on Friday after the U.S. government reported the first decline in payrolls in four years, fanning fears that a housing and credit crisis may tip the economy into recession.

The report that U.S. employers cut 4,000 jobs last month -- the first contraction since August 2003 -- came after data earlier this week showing a larger-than-expected 12.2 percent decline in pending home sales in July.

That added to fears that a housing slump is starting to put the brakes on economic growth, prompting wary investors to cut back on risky assets.

The data sent the dollar tumbling against the yen. The greenback fell 1.4 percent to 113.82 yen as investors covered carry trades that used cheaply borrowed yen to buy higher-yielding and higher-risk assets and currencies.

The dollar index, which measures the greenback against a basket of currencies, also slipped to a 15-year low, while the euro vaulted up 0.7 percent to $1.3785, near a session peak just below $1.3800.

...more...

"Ah'm gonna pick up whar ma daddy lef' off" GWB campaign 2000

http://money.cnn.com/magazines/fortune/fortune_archive/1986/06/09/67671/index.htm

LET DOWN BY THE DROOPING DOLLAR U.S. industrialists haven't found paradise in the plunge they sought. Some companies have regained market share. But the Japanese and others are slashing profits to keep business from American rivals and the big winners -- Asia's aggressive ''little dragons.''

By Edward Boyer RESEARCH ASSOCIATE Kate Ballen
June 9, 1986
(FORTUNE Magazine) – THE DOLLAR'S steeper-than-expected drop should be eliciting hallelujahs in American boardrooms. Instead it is barely evoking sighs of relief. True, many U.S. companies are seeing their foreign subsidiaries' earnings translate into higher dollar profits. Also true, it takes up to 18 months for currency changes to influence demand for American-made products, partly because old contracts must run out. But while the weaker dollar promises to benefit nearly all U.S. industries to some degree, and might even help the beleaguered farmers a bit, American manufacturers say it will not be the boon they had hoped for. ''If we are to regain the competitiveness we have lost,'' says John Beck, vice president of international export sales at General Motors, ''the dollar would have to come down another 15% or 20%.''

The lack of euphoria is surprising, for the dollar has already nose-dived more than U.S. industrialists dared hope just weeks ago. And back then, many were talking tough. At the beginning of this year, with the dollar down to 190 Japanese yen from 263 in February 1985, Chairman Lee Iacocca of Chrysler declared: ''We could give the Japanese a horse race if the yen would stay at 180 to 200.'' In recent weeks the dollar has fallen all the way to a postwar / low of 160 yen -- a 39% drop from its 1985 peak -- before edging back to 163 yen in mid-May. The decline against major European currencies has been almost as steep, with the dollar recently fetching as few as 2.19 German marks (vs. a 1985 high of 3.45). Predicting currency moves is famously hazardous, but most traders and economists believe that despite Japanese and European efforts to halt the decline, the dollar will probably fall a bit more in the next couple of months, to about 155 yen and 2.1 marks. They think that if the U.S. economic growth rate hits the 4% many forecasters are now predicting for later this year -- more than the 2% FORTUNE is expecting -- the dollar will bounce back, but not by a great deal.

So why the gloom from U.S. manufacturers? One reason: Their foreign adversaries have shown an extraordinary penchant for shaving profit margins to hang on to customers in the U.S. and elsewhere. They have not raised their prices nearly enough to reflect the rise in their currencies against the dollar, and in some cases have held the line.

Also restraining them is fierce competition from low-cost competitors in newly industrialized countries such as South Korea, Taiwan, and Brazil, which enjoy a special advantage. Their currencies are linked to the dollar, so their low export prices have hardly budged. Some U.S. economists are beginning to mutter that it is time these countries let their currencies move higher. American companies' own moves have also deprived them of some benefits of the dollar's descent. Prompted by the strong dollar of yesteryear and by high production costs at home, they transferred their production offshore or turned to foreign suppliers, passing up some gains from a falling dollar. While this was going on, foreign competitors were moving into the U.S. and gaining a manufacturing foothold that they are not about to abandon. Here's the latest assessment of the declining dollar's competitive effects on some of America's most important manufacturing industries and their foreign rivals:

more...

http://www.time.com/time/magazine/article/0,9171,951154,00.html?iid=chix-sphere

Agreeing to Boost the Yen
Monday, Jun. 04, 1984 By ALEXANDER L. TAYLOR III

When American businessmen complain about unfair Japanese competition, high on their gripe list is the value of the yen. Many executives contend that restrictions in the Japanese financial system have kept the yen artificially cheap compared with the dollar, and thus have made it easier for Japanese manufacturers to keep prices low when selling their products abroad. In a speech in Detroit earlier this month, Chrysler Chairman Lee Iacocca declaimed, "The Japanese yen is undervalued by at least 15%, and everyone in Washington agrees on that."

Heedful of these complaints, the Reagan Administration has been trying to coax the Japanese into allowing the yen to rise in value. The task has not been easy. As one American economist points out, the Japanese Finance Ministry "likes to study every issue for a decade or so." But now, after a series of meetings in Washington, Tokyo, Hawaii and Rome, a deal appears to have been struck. It is expected to be announced this week.

The latest initiative toward boosting the yen began last fall. Meeting in Tokyo, President Reagan and Japanese Prime Minister Yasuhiro Nakasone pledged to seek ways to end economic friction, particularly concerning the value of the yen. But little progress was made until the end of March, when Treasury Secretary Donald Regan went to Tokyo and bluntly scolded the Japanese at a fist-thumping news conference.

The tough talk apparently made an impact. So did the U.S. suggestion that a greater role for the yen in world finance would mean that Japan would become the second largest shareholder in the World Bank, a prestigious position long sought by the Japanese. At a meeting of economic officials in Rome last week, the two nations wrapped up most of the final details for an agreement.

The deal extracted by the U.S. is based on the theory that if the yen becomes a more freely traded international currency, its price will go up. Despite Japan's size and enormous trading balances (1983 merchandise surplus: $31.6 billion), the yen is not easily used in international finance. Japan's central bank restricts overseas lending and controls the interest rate on yen deposits. As a result, the yen accounts for only about 3% of the currency reserves held around the world; some 85% are in dollars and the rest in West German marks.

Although the precise terms of the agreement have not been made public, Japan is believed to have freed the yen to make it more available for trading on international currency markets. Tokyo will also reduce restrictions on the outflow of the yen and improve the access of foreign banks to the Japanese money market. That means other nations can reduce some of their dollar holdings and start acquiring yen deposits, which should drive up the currency's price in the process.

more...





And another.... http://www.time.com/time/magazine/article/0,9171,960807-1,00.html

Falling Back to Earth
Monday, Mar. 03, 1986 By JOHN GREENWALD.


During the first half of the 1980s, the value of the U.S. dollar seemed to be going into orbit. While American consumers enjoyed cheap imports and luxuriated in foreign travel bargains, U.S. manufacturers complained bitterly that they were being clobbered by overseas competitors. But early last year the dollar bailed out, with a slight push from anxious international moneymen. At first the decline was a gentle drift, but it is now showing signs of becoming a free fall. Since December the dollar has dropped by 19% against the Japanese yen and 8% against the West German mark. It dipped last week below 180 yen for the first time since October 1978, when the American currency seemed so feeble that President Carter announced a dramatic rescue plan. Economists now wonder whether the current decline will end in a soft landing or a painful crash. Says Alan Greenspan, a New York City economic consultant: "There is an increasing danger now that the dollar's fall may prove to be as big a problem to the U.S. as its climb."


Much of the dollar's dive can be traced to a meeting held last September at Manhattan's Plaza Hotel by finance ministers and central bankers from the Group of Five, consisting of Britain, West Germany, France, Japan and the U.S. Deciding that the dollar was overpriced, the officials agreed that their countries would sell dollars on foreign-exchange markets in a coordinated effort to bring down their value. The plan worked, but it may have proved too successful.

Washington's top moneymen seemed to disagree last week about the best course for the dollar. Treasury Secretary James Baker told Congress that the Reagan Administration "would not be displeased" with further declines, provided that they were "orderly." But Federal Reserve Chairman Paul Volcker testified that the currency has already "fallen enough." Added Volcker: "I don't want to see a loss of confidence in the dollar."

Experts agree that a falling currency, like a rising one, offers both opportunities and perils. By making American companies more competitive with foreign rivals, it should help shrink the U.S. trade deficit, which hit a record $148.5 billion last year. Narrowing that gap would create jobs and boost the gross national product. Government figures released last week showed that the GNP grew at an annual rate of only 1.2% in the fourth quarter of 1985 and 2.3% during the year as a whole, the smallest increase since 1982. The weakening dollar will also reduce demands that Congress take protectionist action against imports.

The decline, though, has brought higher costs for foreign goods and overseas vacations. Sony recently raised prices by 5% on its entire line of color television sets because of the falling dollar. A 19-in., remote-control model, for example, now costs $630, vs. $600 in December. Prices of Japanese cars and machine tools have also risen by 5% since December. Last week the American subsidiary of West Germany's Mercedes-Benz added 5.8% to the sticker price of its autos. Pouilly-Fuisse, a popular white burgundy that sold in stores for about $12 in 1985, now goes for as much as $15 for a bottle of the same age and quality.

more...



My question is did someone accidentally, on purpose, in a just kidding sort of way pull another Plaza Accord outta their ass without inviting us?

Last trade 79.982 Change -0.477 (-0.59%)

Settle Time 15:00 Open 80.454

Previous Close 80.459 High 80.569

Low 79.963 2007-09-07 08:52:46, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.958 52wk Low Date 2007-08-06

:eyes:

10:12 am

http://www.kitco.com/market/index.html



edit to add this info...

Last trade 79.933 Change -0.526 (-0.65%)

Settle Time 15:00 Open 80.454

Previous Close 80.459 High 80.569

Low 79.841 2007-09-07 09:45:10, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 79.958 52wk Low Date 2007-08-06

Open Time 19:00 Close Time 15:00

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

will we have to change the name from green back to wet back-cause it isn't treading water anymore. My my.

:kick:

it is the Rio Grand. If I remember my history-Cesar crossed the Rubicon as a conqueror. I think the dollar is just slinking about. Bush is no Cesar.IMHO :spray:

A sharp drop in foreign holdings of US Treasury bonds over the last five weeks has raised concerns that China is quietly withdrawing its funds from the United States, leaving the dollar increasingly vulnerable.

China threatens `nuclear option' of dollar sales (linked article from last month, which in turn links to some yahoo sayin' "It'll never happen" in a blog from July - Never say never....)

Data released by the New York Federal Reserve shows that foreign central banks have cut their stash of US Treasuries by $48bn since late July, with falls of $32bn in the last two weeks alone.

"This comes as a big surprise and it is definitely worrying," said Hans Redeker, currency chief at BNP Paribas.

"We won't know if China is behind this until the Treasury releases its TIC data in November, but what it does show is that world central banks are in a hurry to get out of the US. They don't seem to be switching into other currencies, so it is possible they are moving into gold instead. Gold is now gaining momentum across all currencies and has broken through resistance at 500 euros," he said.

While the greenback has been resilient over recent weeks - even regaining something of a 'safe-haven' role as banks scrambled to buy the currency to cover dollar debts - most experts believe that America's $850bn current account deficit will eventually cause the dollar to resume its relentless slide.

David Powell, an economist at IDEAglobal in New York, pointed the finger at Beijing as the main suspect in the sudden bond flight this summer.

In a client note entitled "Has China started to dump US Treasuries?", he said the sales appear to coincide with early moves by Beijing to launch its new $300bn sovereign wealth fund.

more...

http://www.bloomberg.com/apps/news?pid=20601089&sid=aeAD6tpIzrF4&refer=china

Sept. 7 (Bloomberg) -- China's central bank governor, Zhou Xiaochuan, said there's too much money in the financial system, a day after banks were ordered to set aside more deposits as reserves for the seventh time this year.

``Liquidity has continued to increase rapidly since the second half of last year,'' Zhou said on the sidelines of an investment forum in southeastern China's Xiamen city today.

The central bank is trying to tame an inflow of cash from record trade surpluses that threatens to stoke inflation and asset bubbles. Consumer prices increased 5.6 percent in July, the fastest pace in a decade, after pork costs soared.

Zhou said he didn't yet know the August inflation rate, due to be released Sept. 11.

more...

http://www.bloomberg.com/apps/news?pid=20601089&sid=aIm5dSc.5vQ4&refer=china

Sept. 7 (Bloomberg) -- Central banks in China and Japan drained funds from the financial system after counterparts in the U.S., Australia and Europe made more cash available to lenders.

The People's Bank of China sold 151 billion yuan ($20 billion) of three-year bills to siphon off excess funds that are spurring lending and investment. The Bank of Japan drained 200 billion yen ($1.7 billion) today, and has withdrawn a net 400 billion yen this week.

The spread of losses on securities tied to U.S. home loans has made U.S. and European banks reluctant to lend, prompting monetary authorities to add or reduce money to keep overnight interest rates to their targets. China yesterday increased the amount of funds banks must set aside for a seventh time this year to cool economic growth after raising interest rates four times.

``China has not been affected by the credit-market problem in the U.S.,'' said Grace Ng, an economist at JPMorgan Chase & Co. in Hong Kong.

Japan's market operation was intended to push up the rate for overnight call loans between banks and other financial institutions closer to its 0.5 percent target from 0.42 percent yesterday. It was 0.475 percent as of 2:40 p.m. in Tokyo. The Shanghai interbank offered rate, or Shibor, for overnight loans rose 22 basis points to 2.04 percent today.

``Liquidity has continued to increase rapidly since the second half of last year,'' central bank Governor Zhou Xiaochuan said in an interview in southeastern China's Xiamen city today.

/...

Liquidity effervescing in Asia as it freezes in "the West". - :dilemma:

http://www.kitcocasey.com/displayArticle.php?id=1579

snip>

OK... Yesterday I reported to you that Pending Home Sales had collapsed... Today? Well, unfortunately I have to report to you that 2nd QTR mortgage delinquencies rose to 5.12%, a high since June 2002, but still below the 2001 peak of 5.35%. Uh-Oh... A couple of weeks ago, I reported that foreclosures were up 93%... So, it's all going bad in the housing sector, but HEY! Remember... The Fed and U.S. Treasury Sec. Paulson told us not to worry, that housing had bottomed out, and it wouldn't have a negative effect on the economy...

Oh, and don't feel too badly about the data, because the Gov't tells us that productivity increased last month... Of course I say that with tongue in cheek, because you know my feelings about productivity... It just reports that some poor worker had to work more hours!

But here's my thought on these two pieces of data... Both point to a Fed rate cut... Housing is circling the bowl, and rising productivity is an inflation fighter... So, the Fed will feel a warm and fuzzy about cutting rates on Sept 18th.

And that, my friends, is the thought that entered the minds of Minolta, no, wait... The minds of the market participants, and that's the main reason the currencies rallied strongly throughout the day yesterday... In fact, at one point in the day, the euro revisited the 1.37 handle! But the move to 1.3710 brought about some profit taking... But it sure was nice to see that handle again!

snip>

Yesterday I told you about a couple of corporations that need to go back to school and learn how to account for cash... But over at the Fed... What they're missing isn't cash... Here's the skinny...

Data from the New York Federal Reserve revealed that since late July, central banks around the world have pulled $48 billion from U.S. Treasuries, with a $32 billion fall in the last two weeks. Could this be China dumping Treasuries?

One analyst sees it that way... "David Powell, an economist at New York-based IDEAglobal, called Beijing out as the culprit. In a note to clients, Mr. Powell said that the bond sales coincide with moves by Beijing to kick off a $300 billion sovereign wealth fund."

We won't know for sure until the TICS report on this month is printed 2 months down the road... By then it could be much like being bombed by a stealth bomber... Once you see it... It's too late!

more...

http://www.kitco.com/ind/Laird/sep062007.html

snip...

Now, given the fact that I don’t think Central banks can escape having to monetize more and more trillions worth of derivatives, the question arises ‘what will be the fate of major currencies?’

Central banks have a serious dilemma. If they let the financial system ‘take’ the losses, the credit markets freeze. That will just hammer world economic activity. If central banks do monetize all these growing losses (likely to snowball) then they threaten their own currencies. Both choices are quite bad. Can they work out of this mess? I don’t know. One thing for certain is they will have to act very soon. I think a consensus is building, that, as people begin to understand what is happening, they are going to start dumping some of the major currencies where the derivative losses are centered.

Ultimately, gold should benefit greatly in this situation, although it is subject to some panic selling when institutions need cash during equity crashes.

Also, considering the weakening US, Japanese, and EU economy due to credit contraction, we have one hell of a financial storm building on the horizon. It is a huge black cloud looming on the horizon in front of us. I can see no good reason to be staying in equity markets right now. Cash is definitely king at this time. (gold and precious metals are likely the best cash).

One final note, there has been some talk going around that commodities in general should benefit significantly as these currencies start to have trouble. One major reservation I have about that is that commodities are so sensitive to economic activity. If things really get out of hand in the financial world, I expect some significant economic slowing and falling demand for all the major commodities, and even possibly oil. The world equity bubbles are the only thing still keeping people spending. If those tank, the last standing source of profits for people is likely to start to evaporate. This is not going to be good for commodities.

more...

HMmm, you know I thought this 15 year low would have garnered a bit more press than it has thus far. Googling just isn't turning up a lot of info so far. :shrug:

http://www.bloomberg.com/apps/news?pid=20601039&sid=abUD8XlPQKc4&refer=home

Sept. 7 (Bloomberg) -- Watching the dollar and yen rally during the subprime-induced mortgage crisis, it may be tempting to conclude that the global foreign-exchange market is entering a new phase.

Don't bet on it. These two perennial weaklings are set to fall again and are already showing signs of slumping.

snip past them singing "Glory Days">

``The carry trade is only in remission,'' says David Abramson, Montreal-based head of foreign-exchange strategy at BCA Research Ltd. ``Yen strength is based on liquidation of bearish positioning, not bulls entering the market.''

Reserve Currency

Meanwhile, the dollar shot up 3.5 percent against the euro in just six August trading sessions. That prompted some analysts and investors to proclaim that, for all its warts, the cellar- dwelling U.S. currency at least still serves as a haven during periods of financial stress.

Even so, the U.S. currency's prospects relative to its European counterparts are anything but bright. Goldman Sachs Group Inc. two weeks ago lowered its dollar forecasts. It told clients the euro would rise to a record $1.43 within the next three-to-six months. That compares with an earlier forecast of $1.35 and a current level of about $1.37.

That's bad news for European cross-border investors. Their U.S. stock and bond holdings will be worth less when translated into euros and other European currencies. A stronger euro, which has risen 65 percent against the dollar in the past seven years, will also make European companies less competitive on world markets.

Goldman's logic: ``The weakness in U.S. credit markets will lower foreign demand for U.S. credit products, weakening the flow dynamics for the dollar,'' says Jens Nordvig, a New York-based senior economist at Goldman.

`Decoupling'

Furthermore, there is potential for additional ``decoupling'' of growth between the euro zone and the U.S., he says. That in turn should help shrink the gap between U.S. and European interest rates, lowering the appeal of dollar- denominated assets to international investors.

more...

I say by Christmas

Looks like we're headed into $700+ territory for gold again. Who could've foreseen such a thing?? ;-)

Fasten your seatbelts Marketeers, I suspect it's going to be a wild day at the casino!

:hi:

Julie

All my gold stocks are starting to shine!!!:bounce:

My Gawd, they are wild on CNBC...Hear the shouting in the background?

:silly:

:toast:

01. Beazer Homes receives purported default notices on notes
8:33 AM ET, Sep 07, 2007 - 1 minute ago

:eyes:

"For the first time, our children may live less long than their parents, because with obesity comes such ailments as heart disease, hypertension and diabetes. These diseases are all very expensive to treat"

This capital commitment is likely to hold down the nation's productivity and its competitiveness in global markets.

Hey, free markets baby!!!

We use high fructose corn syrup in nearly everything cuz it's cheap to use and a little bit goes a long, long way! That's capitalism and ingenuity at it's finest!

We refine our grains to the point where we have enrich them to put freaking nutrients back in, but hey, that bushel of wheat goes a long, long way too.

Our workers put in longer hours, and get less time off than their "lazy European counterparts" attributing to higher levels of stress and cortisol...basically we're working ourselves to death chasing that elusive Murikan dream of becoming independently wealthy.

Then there's fast food, junk food, addicting food. Granted no one is strapping us to our couches and pouring it down our throats, but they're not being completely honest here either.

There's an entire weight loss industry built around those couch spuds and the drug industry's bottom line is helped more by unhealthy than healthy Murikans. Free market enterprise, that's what it's all about!!! :eyes:

Dow 13,208.33 155.02 (1.16%)
Nasdaq 2,577.74 36.58 (1.40%)
S&P 500 1,460.02 18.53 (1.25%)
10-Yr Bond 4.422% 0.078

NYSE Volume 122,321,000
Nasdaq Volume 107,073,000

true rate of inflation?

when * squatted at 1600 Penn Ave in 2001 - oil was $27 a barrel - it is now at $77 per barrel - that is a 285% increase :shrug:

01. Paulson says inflation is contained
9:48 AM ET, Sep 07, 2007 - 1 minute ago

02. Paulson: 'We're going to work our way through this'
9:48 AM ET, Sep 07, 2007 - 1 minute ago

04. Paulson says economy will continue to grow in H2 '07
9:47 AM ET, Sep 07, 2007 - 2 minutes ago

The government announcements don't even try to be credible anymore. Who are they fooling? Themselves?

who just received about half-a-billion dollars, tax free, for taking a government job.

but if continuing a standard of living is the measure, it's more like 15-20.

Sept 6th update. Helicopter Ben is now airborne, folks.

Thats not what Kitco say.

Just wondering...

:shrug:

when the feds decrease rates today or next week.

All of Bernanke's liquidity is starting to take its toll. Seriously, folks...buy all the gold you can get your paws on...

Where's my bug zapper?

9:53
Dow 13,225.48 Down 137.87 (1.03%)
Nasdaq 2,582.15 Down 32.17 (1.23%)
S&P 500 1,461.52 Down 17.03 (1.15%)
10-Yr Bond 4.414% Down 0.086
NYSE Volume 245,563,000
Nasdaq Volume 190,779,000

09:40 am : The stock market opens as advertised, on a decidedly negative note in the wake of the surprising weakness in the Aug Non-Farm payroll number. Although expectations for a Fed easing this month and potentially in the months ahead have ramped up and that even flat payroll growth correlates to 2% real GDP growth, the stock indices are sitting near session lows after the gap down start.DJ30 -106 NASDAQ -38.61 SP500 -19.97

09:17 am : S&P futures vs fair value: -18.9. Nasdaq futures vs fair value: -26.8. After spending 45 minutes digesting the weaker than expected payroll report, which marked the first negative reading since Aug 2003 and biggest factory firing since July 2003, the futures have dropped to new pre-market lows. The market will have to grapple with this unexpected downturn in payroll vs. the increased probability of a rate cut on Sep 18 and potential for more than a 25 bp cut which was largely priced in already. At this juncture, however, this is providing little solace.

09:00 am : S&P futures vs fair value: -16.6. Nasdaq futures vs fair value: -20.0. The pre-market readings did extend below the knee jerk reaction to the data, which was the first negative payroll number since Aug 2003, but have begun to stablize. Although the weaker economic growth is of concern going forward, increased expectation for a Fed cut in interest rates on Sep 18 at least for the immediate term has stalled the pre-market slide. Real GDP forecasts for the second half of the year might be shaved a bit, but will probably still stay near 2%.

Comment by Gary Kaminsky of Neuberger Berman, LLC. No link... he was just interviewed on CNBC.

Contrast that with a carefully-parsed statement from a Federal Reserve talking head yesterday:



:eyes:

why is this kind of lost in the bather and officialdom reminding me... oh never mind

By the way, just checked this morning... UGGLY

10:26
Dow 13,204.75 Down 158.60 (1.19%)
Nasdaq 2,578.46 Down 35.86 (1.37%)
S&P 500 1,461.34 Down 17.21 (1.16%)
10-Yr Bond 4.418% Down 0.082
NYSE Volume 463,354,000
Nasdaq Volume 371,468,000

10:00 am : The stock indices are attempting to stabilize follow the early payroll related selling spree. With all the uncertainty surrounding what this means to the economy and potential Fed moves going forward, traders often look to important technical sign posts in the market averages to catch their collective breath and reassess the situation. This morning the S&P 500 has tested and held near its 200 day average while the Nasdaq Comp has held near its 50 day avg.

The worst performing sectors this morning are being led by Semi which has been hurt by NSM -2.4% on earnings/guidance, Home Construction -1.9%, Airline -2.7% (selected downgrades) and Retail -1.8% but note that all are working off early lows. One of the main beneficiaries this morning has been Gold. Based on the Gold ETF (GLD) it has edged back after running to its highest level since May 2006. DJ30 -137 NASDAQ -32.76 SP500 -17.35 NASDAQ Dec/Adv/Vol 2135/356/174 mln NYSE Dec/Adv/Vol 2301/252/78 mln

10:32
Dow 13,194.67 Down 168.68 (1.26%)
Nasdaq 2,575.63 Down 38.69 (1.48%)
S&P 500 1,460.44 Down 18.11 (1.22%)
10-Yr Bond 4.418% Down 0.082
NYSE Volume 504,350,000
Nasdaq Volume 395,661,000

giving updates on both boards down bigtime on top of the dollar drop... job numbers...

she's gettin a little crease in her forehead :(

Oh joy....

Yep they would sound a little strained I am sure

By the by, not that they will make THIS connection, but the numbers have overall staid in the same band and cannot move out of it, since they dropped back in August...

go to the circus. Watch it for the 20 face-painted clowns rolling out of a tiny car. Or for the high-wire artist who tumbles from seventy five feet, only to be caught by the net. CNBC and the circus are near equals about the state of the world at-large.

entertained days....


http://www.youtube.com/watch?v=BOv-2HzNPaA

that looks like fun!

Love the choice of music....

http://www.youtube.com/watch?v=DPp2HlIMkmU

You don't see any of us girls doing anything crazy like that!

:rofl:

http://www.ft.com/cms/s/0/707b25a0-5cc3-11dc-9cc9-0000779fd2ac.html

Apple on Thursday offered a $100 store credit and an apology to early adopters of its iPhone mobile handset after they reacted angrily to a large price cut within 10 weeks of its launch.

Apple said on Wednesday it was discontinuing a four-gigabyte model and cutting the price of its 8Gb iPhone by a third – from $599 to $399.

The move, designed to boost sales during the holiday season in the US, was an unusual one for the company. It commands premium prices for its products and tends to add features to them to justify maintaining existing prices.

IPhone owners, some of whom queued for days to buy the handset before it went on sale on June 29, had by Thursday besieged Apple with complaints that they had been taken advantage of and overcharged.

In an open letter on Apple’s website, Steve Jobs, chief executive, said he had received hundreds of e-mails from iPhone customers upset at the price being dropped and had read every one of them.

Mr Jobs said the company stood by its decision to slash prices so soon after the iPhone launch.

“This is life in the technology lane,” he said. “If you always wait for the next price cut or to buy the new improved model, you’ll never buy any technology product because there is always something better and less expensive on the horizon.”

more....

Hmmmm, Job's singing "That's Life" to his adoring followers? Wonder how many will be so quick to run out and buy the new touch screen edition. Hey, being the first on the block to have one has gotta be worth the extra bucks - right? :eyes:

This is just a nasty downward spiral now, all of it!!! Housing, payroll, the markets, commercial paper...etc.

I think Bernanke KILLED our markets and the economy!

There are only two ways to fund wars. First is thru higher taxes and the second way (which most gov'ts take) is thru currency debasement. * has taken the latter route and now we are seeing the consequences.

to "kick him while he's down". :shrug:

We have a bunch of problems to work out now...

Reich: "We're In A Recession." "We're Going To Look Back On First 10 Years Of This Century, To Greenspan & Fed's Easy Money Policy, As The Reason For All The Upcoming Distress."

12:08
Dow 13,157.77 Down 205.58 (1.54%)
Nasdaq 2,568.65 Down 45.67 (1.75%)
S&P 500 1,457.68 Down 20.87 (1.41%)
10-Yr Bond 4.378% Down 0.122
NYSE Volume 1,075,520,000
Nasdaq Volume 845,031,000

Dow 13,158.66 204.69 (1.53%)
Nasdaq 2,568.55 45.77 (1.75%)
S&P 500 1,457.54 21.01 (1.42%)
10-Yr Bond 4.378% 0.122

NYSE Volume 1,077,495,000
Nasdaq Volume 845,879,000

11:35 am : The indices have extended the opening session losses over the last hour and are currently sitting near their worst levels of the day. There is relatively little incentive to step in to fight the morning trend as the market was already up substantially off last week and Aug lows into Monday highs; there is now a significant worry as to how far the housing/subprime developments will spread; uncertainly has risen as to not if but how much the Fed will cut and there are no potential data points or likely any fresh news to provide a lift until next week.

As mentioned earlier, however, market participants often use technical milestones for opportunities to reassess. With the S&P 500 back near its 200 exp avg at 1451 with midday approaching we could see some pause in the trend to reassess over lunch. The sector performance remains ugly with nothing other than gold in the black. The weakest groups, which could see some bounce during the lunchtime reassessment, include Home Construction, Semi, Retail, Disk Drive and Airline. DJ30 -227 NASDAQ -54 SP500 -24 NASDAQ Dec/Adv/Vol 2382/408/658 mln NYSE Dec/Adv/Vol 2606/513/462 mln

As much fun as it would be to hang around - have to go and see how grim the art world is in Omaha for the weekend -

You guys have a great weekend and I'll be back on Monday! :hi:

and the bottom drops out...

So much for the BushCo 'smoke & mirrors' economy.

http://www.reuters.com/article/reutersEdge/idUSL0681330620070906

LONDON (Reuters) - For every day the world's money markets remain dysfunctional, the chances of the very kind of financial failure they fear rises.

A rolling credit crunch emanating from U.S. subprime lending has spread through the asset backed commercial paper market through to interbank money markets, the very heart of the global financial system.

And while central banks have regained a semblance of control, more or less, over the overnight lending markets, there is still a hugely unusual unwillingness by financial institutions to lend each other money for three months.

There is debate about why this is happening, but what is clear is that there are people out there with a huge mismatch between how long their commitments to lend money are compared to the length of time for which they are able to borrow.

That leaves these financial entities, be they conduits or mortgage lenders or whoever else, extremely vulnerable in a market which is already highly agitated.

snip>

The Bank of England in taking steps on Wednesday to bring down overnight rates stressed that it was not seeking to guide three month rates lower, which it said were not being driven by central bank liquidity.

ECB President Jean-Claude Trichet said on Thursday that the bank would launch a supplementary long-term refinancing operation with no preset allotment.

Many in the market think money market dislocation is being driven by fear that the outfit you lend to may not be in such good shape in three months time.

While Bond of Barcap disagreed with this, he was stark about the risks.

"As the whole banking system's finances get shorter and shorter the probability of a mistake gets higher and higher," he said.

more...

Even if the credit crunch passes without a major catastrophe, the prices of stocks, bonds and real estate have a long way to fall.

http://money.cnn.com/magazines/fortune/fortune_archive/2007/09/17/100250262/index.htm

snip>

But even if this crisis is contained, we are facing some near certainties that should be understood.

First, house prices may move on euphoria in the short term, but long term they depend on family income - the ability to pay mortgages and rent. At levels well above the normal four times family income, the market gradually loses first-time buyers until prices break and fall back to affordable levels.

House prices are in genuine bubble territory in the U.S., Britain and many other markets. In Britain and in some critical large cities in the U.S., for example, the multiple of family income has risen to over six times from below four times, and in London last year the percentage of first-time buyers was the lowest since records began.

From these high levels, prices are guaranteed to fall. In doing so, they will reduce consumer borrowing and spending power. They will also increase mortgage defaults, most of which lie ahead, and lower financial profits and confidence.

Second, profit margins are at record levels around the world. They have lifted stock prices directly alongside the rising earnings. They have served to raise P/E multiples as well, for surprisingly, investors on average reward higher margins with higher P/Es. This is fine for an individual stock, but for the entire market, multiplying boom-time profits by high P/Es is horrific double counting and sends markets far too high in good times (and far too low in bad times).

Higher margins also indirectly raise prices by providing more cash flow for buybacks and takeovers. So high profit margins offer multiple supports for the market, but they will certainly decline. They are the most dependably mean-reverting series in finance: If high margins do not attract greater competition, then a wheel has fallen off the capitalist machine. For U.S. and developed foreign markets, fair value (defined as normal P/E times normal profit margins) is about one-third below today's level, and for emerging markets it is about 25 percent lower.

Third, and most important, risk will be repriced. Last year a broad base of risk measures - including volatility (VIX), junk and emerging debt spreads, CD rates, high-quality vs. low-quality stock values - reflected the lowest risk premiums in history. On some data, indeed, investors actually appeared to be paying for the privilege of taking risk.

more...

I believe this phenomenon was population driven, partly. The mass of babies after world war two gave great confidence that there would be a market. And now that they've done their thing, well, they're done.

And also, since every square inch of meaningful land has been developed, I predict there won't be many new housing starts in the foreseeable future.

Dow 13,182.40 -180.95 (1.35%)
Nasdaq 2,569.31 -45.01 (1.72%)
S&P 500 1,460.16 -18.39 (1.24%)
10-Yr Bond 4.38% -0.12

Seems the flow of blood has lessened a bit. Mighty big drop in the 10 yr. yield and gold way up, it's almost as though somebody's screaming "fire!!" in this crowded casino.

Julie

...

http://www.webofdebt.com/articles/market-meltdown.php

Panic struck on Wall Street, as the Dow Jones Industrial Average plunged a thousand points between July and August, and commentators warned of a 1929-style crash. To prevent that dire result, the U.S. Federal Reserve, along with the central banks of Europe, Canada, Australia and Japan, stepped up to the plate and extended a 315 billion dollar lifeline to troubled banks and investment firms. The hemorrhage stopped, the markets turned around, and investors breathed a sigh of relief. All was well again in Stepfordville. Or was it? And if it was, at what cost? Three hundred billion dollars is about a third of the total paid by U.S. taxpayers in personal income taxes annually. A mere $188 billion would have been enough to repair all of the 74,000 U.S. bridges known to be defective, preventing another disaster like that seen in Minneapolis in July. But the central banks' $300 billion did not go for anything so socially useful as rebuilding infrastructure. Rather, it was poured into the black hole of rescuing the very banks and hedge funds that were blamed for precipitating the crisis, encouraging them to continue in their profligate ways.

Where did the central banks find this $300 billion? Central banks are "lenders of last resort." According to an article in the Federal Reserve Bank of Atlanta's Economic Review, "to function as a lender of last resort must have authority to create money, i.e., provide unlimited liquidity on demand."1 In other words, central banks are authorized to create money out of thin air. Increasing the money supply ("demand") without increasing goods and services ("supply") is highly inflationary. However, the authority is said to be necessary because the banking system is inherently prone to crises and market failures, and a lender of last resort with the ability to bail out the banks in a crisis is essential to maintaining a smoothly running economy.2 Periodic "busts" have followed "booms" so regularly and predictably in the last 300 years that the phenomenon has been dubbed the "business cycle," as if it were an immutable trait of free markets like the weather. In fact, however, this cycle is an immutable trait only of a banking system based on the sleight of hand known as "fractional-reserve" lending. The banks themselves routinely create money out of thin air, and they need a lender of last resort to back them up whenever they get caught short in this sleight of hand.

Running through this whole drama is a larger theme, one that nobody is talking about and that can't be cured by fiddling with interest rates or throwing liquidity at banks making too-risky loans. The reason the modern central banking system is prone to periodic crises and market failures is that it is a Ponzi scheme, one that is basically a fraud on the people. Like all Ponzi schemes, it can go on only so long before it reaches its mathematical limits; and there is good evidence that we are there now. If we are to avoid the greatest market crash in history, we will need to eliminate the underlying fraud; and the first step in that process is to understand what is really going on.

The 300 Year Ponzi Scheme Known as "Fractional-Reserve" Lending

A Ponzi scheme is a form of pyramid scheme in which earlier players are paid with the money of later players, until no more unwary investors are available to be sucked in at the bottom and the pyramid collapses, leaving the last investors in holding the bag. Our economic Ponzi scheme dates back to Oliver Cromwell's "Glorious Revolution" in seventeenth century England. Before that, the power to issue money was the sovereign right of the King, and for anyone else to do it was considered treason. But Cromwell did not have access to the Sovereign's money-creating power, so he had to borrow from foreign moneylenders to fund his revolt; and they agreed to lend only on condition that they be allowed back into England, from which they had been banned centuries earlier. In 1694, the Bank of England was chartered to a group of private moneylenders, who were allowed to print paper banknotes and lend them to the government at interest; and these private banknotes became the national money supply. They were ostensibly backed by gold; but under the fractional-reserve lending scheme, the amount of gold the lenders held in "reserve" was only a fraction of the value of the notes they actually printed and lent. This practice grew out of the discovery of the earlier goldsmiths, that customers who left their gold for safekeeping would come for it only about 10 percent of the time. Ten paper banknotes "backed" by a pound of gold could therefore safely be printed and lent for every pound of gold the goldsmiths actually held in reserve.

The Bank of England became the pattern for the system known today as "central banking." A single bank, usually privately owned, is given a monopoly over the issue of the nation's currency, which is then lent to the government, usurping the government's sovereign power to create money itself. In the United States, formal adoption of this system dates to the Federal Reserve Act of 1913; but private banks have created the national money supply ever since the country was founded. Before 1913, multiple private banks issued their own banknotes with their own names on them. Like the Bank of England's notes, these notes were ostensibly backed by gold; but the banks issued notes valued at many times the gold they actually had in their vaults. The scheme worked fairly well, until the customers periodically got suspicious and all demanded their gold at the same time, when there would be a "run" on the banks and they would have to close their doors. The Federal Reserve (or "Fed") was instituted to rescue the banks from this sort of crisis by acting as "lender of last resort," a bankers' bank able to create money out of nothing and lend it to the banks on demand. The banks themselves had already been creating money out of nothing for two centuries, but the Federal Reserve served as a backup source, generating the customer confidence necessary to carry on with the banks' fractional-reserve lending scheme.

more...

the bleeding was not staunched'

Any bets on the feds actions?

the markets to the automatic curbs if it gets too crazy. They seem to get real defensive at 12K on the DOW and 1400 on the S&P so I think there's enough wiggle room for them in stocks. I'm curious as to how much of a surprise (if any) this slide in the buck was to them. :freak:

Trading SPemini NOT ADVICE

Dow 13,102.65 -260.70
Nasdaq 2,559.01 -55.31
S&P 500 1,450.82 -27.73
10 YR 4.37% -0.13
Oil $76.70 $0.40
Gold $709.70 $5.10


Damn...look at that 10-year tanking lately (well, the yield that is)

3:35 pm : Seeing the sectors that paced the way on the bounce off the morning lows (Finance XLF, Energy XLE) and during the rally attempt over the last hour (Semi SMH) taking some heat again in recent trade with the Dow and S&P 500 setting minor new session lows. Nasdaq Comp has retested but not taken out its morning trough. The only real question seems to be if there will be any short covering in front of the weekend as buyers have no incentive to step in with any conviction. :eyes:

DJ30 -264 NASDAQ -55 NQ100 -2.3% SOX 2.7% SP400 -2.0% SP500 -28 XOI 1.9% NASDAQ Dec/Adv/Vol 2388/593/1.50 bln NYSE Dec/Adv/Vol 2573/692/1.094 bln

so we don't loose over 2%

I have to wonder who is the white knight riding to the rescue

That was more than just a test of a bottom

down only 250.

that is my guess...

If they did... that would have spooked many bulls who keep telling us all is fine

Dow 13,113.38 -249.97
Nasdaq 2,565.70 -48.62
S&P 500 1,453.55 -25.00
10 YR 4.37% -0.13
Oil $76.70 $0.40
Gold $709.70 $5.10


I'm practically on my knees now begging my Dad to stop playing the markets with his pension stocks. ("If it drops down to a $1 below where I last bought, I'll switch back to stocks"). :banghead:

has no health ins. & just inherited quite a load last year. It is all in Merrill Lynch.

I told her to get out and lock the money up into some safe investments last year as I could see this coming. I even told her to buy some gold as a hedge. She won't listen. Last I heard she'd lost almost $100,000.

Too bad she trusted that "nice guy" handling her money. :(

I inherited a nice bonus, no where near $100,000, so couldn't even lose that much. I just plunked it in a CD, until I can figure out what to to do with it.We're lucky in that we have no debt, so may open a college savings account for grandkids.

To me, she is the very last person that should be in this, esp. having no health insurance.

I think she inherited about $750,000.00 and so far $100,000.00 has been lost/spent (she's been buying expensive cars and is now having a house built).

She took out an ARM to build the house.

Merrill Lynch wouldn't allow her to borrow against any of the funds that are on deposit with them. She has to go through them every time she wants to spend some of it too. That right there would make me run away fast!

I hope she wakes up and gets out before all is gone.

The building of the house is a bad plan. She has no family and doesn't need a huge house. She is no spring chicken either and her health is not good.

I truly worry for her, believe me. I tried, that is all I can say. :(

Sounds like someone has impressed her that having a big house/big mortgage is an investment for the future. Ugh. It's just a big debt. I hope she wakes up soon too.

that was wild

And is it me or are we having way, and I mean WAAAAYYYY too many of these days?

:hide:

This is the discussion currently on CNBC

CNBC have spent so many years pimping the markets that they have started to believe their own hype.

They must find the current reality rather disturbing as their world view crumbles to dust before their eyes.

No wonder they are finding it hard to cope.

See my post #80.

:rofl:

4:30 pm : The stock market gapped aggressively lower off the open following the much weaker than expected Non-Farm payroll data. The report rolled in below the flat line (-4K vs. consensus of 110K) for the first time since Aug 2003 (factory firings highest since July 2003) with the last two reports from June and July revised down a combined -81K as well. According to the futures market this locked the odds of an interest rate cut of 25 bp on Sep 18 (50% chance of 50 bp). Note too that flat payroll growth correlates to 2% real GDP growth given the long-term trend of 2% productivity growth. However, uncertainty is never well received in the marketplace and the report has the Street unsure how much the Fed will cut in Sep (GS suggested 50 bp, BSC said 25 bp, Barclay's expecting 75 bp by end of year) while also increasing fear as to how far the housing/subprime/economic woes will be felt now that we have seen evidence in the jobs numbers.

The negativity was not limited to the jobs data as we also saw bearish news/commentary in Semi (NSM, XLNX), Airline (selected downgrades) and Home Construction (BZH). Also of interest, but overshadowed by the jobs report, were statements from former Fed Chair Greenspan suggesting that the current market turmoil is in many ways identical to that which occurred in 1998 and 1987.

Tests of multi-year highs in Gold and multi-year lows in the 10-Yr Yield and the lagging performance in Finance (largest segment of the S&P 500) off of the Aug lows implies that fear/risk are rising. While market internals were firmly negative and volume rose above previous sessions, TRIN (measure of selling pressure) ended at excessively high levels which suggests watching for signs of short term stabilization early next week. BTK -1.3% DJ30 -249.97 DJTA -2.0% DJUA -1.7% NASDAQ -48.62 NQ100 -2.0% R2K -2.1% SOX -2.5% SP400 -1.8% SP500 -25.00 NASDAQ Dec/Adv/Vol 2337/664/1.894 bln NYSE Dec/Adv/Vol 2558/754/1.459 bln

kick
edit, now down 452. That's 2.83 percent.