TARPUS Interruptus
The TARP continues it amazing morphing machinery, as it migrates miles and miles away from the original bill of goods sold to Congress.
The government is abandoning the centerpiece of its $700 billion rescue effort for the financial system and will not use the money to purchase troubled bank assets.
Why? Because Treasury Secretary Paulson has finally figured out what many experts previously stated: that buying troubled asset purchases “not the most effective way to use TARP funds. ”
Instead, we are finding all sort of new, unapproved and inefficient ways to spend the TARP. Everyone from GM to AMEX is up for some Federal (read taxpayer) largesse.
No matter. Hank the Destroyer said that we will continue to use $250 billion of the program — or, as it was known when he was helping to leverage up Goldman Sachs to unsustainable levels as “walking around money” — to recap bank stocks, bolster balance sheets and “encourage them to resume more normal lending.”
Up next is an expansion into securitized credit card debt, auto loans and student loans.
And soon after, the government will start to guarantee new GE Capital debt.
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November 12th, 2008 at 2:49 pm
It really is a shame the guillotine has gone out of favor, as the only ones who would ever punish this looting of the treasury would be the tired, the poor, the huddled masses yearning to be free crowd.
November 12th, 2008 at 2:50 pm
Can I declare my self a bank and get some of this? :).
November 12th, 2008 at 2:52 pm
I wish Paulson would be shown the door. Right now.
November 12th, 2008 at 3:06 pm
If only Johnny Cash were still alive:
How high’s the Bailout, mama?
$700 Billion and risin’
How high’s the Bailout, papa?
$700 Billion and risin’
We can make it to the road in a homemade boat
That’s the only thing we got left that’ll float
It’s already over all the wheat and the oats,
$700 Billion and risin’
How high’s the Bailout, mama?
A Trillion-and-a-half and risin’
How high’s the Bailout, papa?
A Trillion-and-a-half and risin’
Well, the hives are gone,
I’ve lost my bees
The chickens are sleepin’
In the willow trees
Cow’s in water up past her knees,
A Trillion-and-a-half and risin’
How high’s the Bailout, mama?
Three Trillion and risin’
How high’s the Bailout, papa?
Three Trillion and risin’
Hey, come look through the window pane,
The bus is comin’, gonna take us to the train
Looks like we’ll be blessed with a little more rain,
Three Trillion and risin’
How high’s the Bailout, mama?
Five Trillion and risin’
How high’s the Bailout, papa?
Five Trillion and risin’
Well, the rails are washed out north of town
We gotta head for higher ground
We can’t come back till the debt comes down,
Five Trillion and risin’
Well, it’s five Trillion and risin’
November 12th, 2008 at 3:08 pm
I think we should lower taxes, deregulate, and get rid of the CRA!!
I’m sure that will fix everything, right?
Oh, wait, we better do something about teh gays while we’re at it……….
November 12th, 2008 at 3:08 pm
suicide by TARP.
long OOM bank and index Puts has, is, and will be the only trade until it’s not.
if you snagged the previous fake bottom, i hope you snagged some real profits.
two weekends ago Dow pushing 9500, all my NY hedge/ prop friends were mildly bullish.
why?
November 12th, 2008 at 3:08 pm
The incompetence of Paulson and the country’s financial leadership is simply, and literally, breathtaking. No wonder the markets are so schizophrenic. What the hell are they doing at Treasury?
November 12th, 2008 at 3:16 pm
What happened to the constitutional government? Shouldn’t Paulson at least state that after consulting w/ the president, Congress, etc., it was decided to do this, this, and this? It appears that he uses an 8 ball or something to make these decsions unilaterally. I just can’t imagine anyone taking over at Treasury after this group. I think that Obama will be stuck w/Summers or (god forbid) Rubin, as they would at least be able to hit the ground running re regular Treasury operations, while they try to divine exactly what policy is being followed by Paulson, Inc.
November 12th, 2008 at 3:24 pm
Anyone think he gets an invite to stay on in the new admin ?
November 12th, 2008 at 3:25 pm
So when a company goes broke the board of directors says ‘this CEO got us here, so he’ll get us out’ right? wrong.. they fire his ass faster than he can blink.
Yet Bernanke, Paulson and friends got us here and we’re to think they’re the ones to get us out of it? *sigh*
November 12th, 2008 at 3:25 pm
“TARPUS Interruptus” That’s cute. But what Washington is doing is not. During the two week period that the bailout legislation was being debated Paulson came to the conclusion that spending the money on purchasing troubled bank assets was NOT the way to go. So instead of telling Congress to hold on while he reevaluated the plan, he let them approve it. That is why he wanted broad discretionary power on how the money was spent AND no legal repercussions. He duped Congress into approving the bill at a loss to the American taxpayer. Paulson’s edict today was “banks must lend”. Next week’s edict will be “consumers must borrow”. I refer to these raids on our wealth to my family and friends as; the fleecing of America. Wall Street may be the financial capital of the world. But the world is growing skeptical of Wall Street’s capital.
November 12th, 2008 at 3:28 pm
Barry Ritholtz Says:
November 12th, 2008 at 3:24 pm
Anyone think he gets an invite to stay on in the new admin ?
No.
November 12th, 2008 at 3:30 pm
And the band played on. Look out below.
November 12th, 2008 at 3:31 pm
I commend Paulson for changing his mind.
1) He went into the Lehman decision (post Bear Sterns) determined to stick with the Bush/Far Right ideology, on “bailouts.” That, was a failure.
2) He went to Congress determined to “buy assets” since “investing” would be “socializing” even though the history of the successful bank rescues have been preferred injections – determined to stick with Bush / Far Right ideology. The economic community was outraged at his blithe rejection of history, Congress balked, things got hairy… That, was a failure.
Now he’s retooling. He’s rejecting the B/FR ideology and hoping to move forward.
Instead of mocking a man who admits his mistakes, let’s rejoice after eight years of Bush who “never made a mistake. “
November 12th, 2008 at 3:32 pm
Anyone think he gets an invite to stay on in the new admin ?
Hell, who knows? The guy has facilitated a wealth transfer scheme, par excellence. Maybe Obama wants in on it too.
November 12th, 2008 at 3:37 pm
@VennData: Fair point but that assumes we think he knows what he’s doing. Is that a given at this point?
November 12th, 2008 at 3:39 pm
Barry,
was that last line about GE Capital a snark?
I can hardly tell these days.
Chuck
BTW, what about doing threaded comments? would be nice to respond to something you or someone else said without going all the way to the bottom.
Check out wordpress brian’s threaded comments. You can even add back in the Gravatars (I did it on my site to see what it looks like)
November 12th, 2008 at 3:41 pm
Anyone think he gets an invite to stay on in the new admin ?
There’s at least an outside chance the incoming had a hand in the change of plan, so I wouldn’t rule it out entirely.
November 12th, 2008 at 3:41 pm
As to Paulson staying on…hell NO!! Take the last of the $60B they got and divvy it up between GM and Ford to retool and NOT pay off old loans or make 0% financing available. Let Chrysler go, it’s the weakest link and owned by a private investment company. Goolsbee is an economist, put him in there working with Hanky-Panky in order to effect a smooth transition. He’s held his own with Mr Goldilocks and we all know what a jerk he can be. Leave the rest of the TARP for the new Administration to do what it deems as prudent.
November 12th, 2008 at 3:46 pm
Look out below.
The world is in the process of realizing we are not the Masters of the Universe and have been winging this recovery from the get-go.
I just can’t wait to see what happens in Asia and Europe tonight and early tomorrow. Gosh, what a mess?
Get short (if you can) or get out. That’s my 2 cents worth.
November 12th, 2008 at 3:49 pm
I don’t know who is dumber, Paulson, Congress and crew thinking they could actually stop the tides or the people here and everywhere else that thought there was a Plan somewhere, somehow that would work. Even more laughable is the thought that there is a difference between Bush’s imbeciles and Obama’s.
The cover up is always worse than the crime.
Don’t worry you plan believers, they will keep trying something until, as the cock in the morning mistakes his abilities, the market will be bottoming on its own and the last cockeyed plan will be given credit. In the interim we seem to have skipped right over Obama’s feared Socialism and embraced some new aged Stalinism with its wide embrace of central planning 101. With a little luck we will have Gore as Rasputin running through the White House telling us how the markets are crashing because of hot air.
Think how boring it would have been with McCain.
November 12th, 2008 at 3:54 pm
The plan was for capital injections from day one. There was NO WAY Bush would have let Paulson institute a “socialist” program to take govt stakes in private companies TWO months before the general election. A week after the election, the truth comes out. If you look at what Barney Franks has been saying – “It has been our intention to inject capital into banks” from day one.
Amen.
November 12th, 2008 at 3:54 pm
I have been buying this afternoon, but only in the area of commodity stocks. I am finding it hard to believe that international commerce will decline 91% for the rest of the decade. Interplanetary commerce maybe….
Banks? You can keep em.. I wonder when the UYG will hit zero?
November 12th, 2008 at 4:03 pm
There was NO WAY Bush was letting Paulson intitute a program for the government to take partial ownership in private companies TWO MONTHS before the general election. One week after the election, the truth comes out. Barney Franks has been saying – “It is our intention to inject capital into banks” from day one.
November 12th, 2008 at 4:05 pm
leftback Says: “I have been buying this afternoon, but only in the area of commodity stocks.”
If I had funds in a tradable account that’s what I’d be buying also. The fundamentals in oil have actually gotten worse (used reserves) as the price has dropped and precious metals in a physical capacity are a bitch to find. Besides, if they do manage to re-inflate the world’s engine of growth (us) commodity stocks will take back off.
November 12th, 2008 at 4:09 pm
Well, here we are at those lows we were supposed to retest on the S&P. 13 points to a new intraday low. I watch with great interest. (And still short Euro/Yen from 124.)
November 12th, 2008 at 4:10 pm
@ Pat G: and if my trading account doesn’t work out, I will just become a bank. :-)
November 12th, 2008 at 4:12 pm
I know there is a problem, but my built in bullshit meter is flashing in a similar way as it did when oil was at $147 and memos were being published that said $250 oil was coming real soon and $300 was coming later. Everybody believed them, and I think many still do, but it was all a lie. The scam was to scare the crap out of people until they thought the world was about to end due to peak oil, and any amount was ok to pay for oil. Then the oil merchants came out in many forms and fleeced the gullible. Like any good scam, many still think the world oil supply is going to be gone in about 6 months.
Now, the world is out of credit. The fact we are in a recession is proof the world is about to end soon unless all the treasuries of the world open their doors and let in anyone who has a sad story. The business pundits all agree there is trouble in river city and it begins with ‘C’ and it ends with ‘T’. The fast hustle is going on and has taken a step up in play.
To give this some perspective, there is the Theory of Boone and it’s stepchild, The Theory of Demand Destruction. The Theory of Boone said world oil demand is 87 mbpd and supply was only 85 mbpd, thus implying any price for oil is not high enough. The Theory of Demand Destruction states that the natural price of oil is astronomically high and if the price of oil falls it is due a decrease in demand that actually signifies the End Of Times. Economists with Nobel prizes in their resumes fell for this.
I was right in a former life when I ridiculed oil prices and I believe I am right now when I proffer that the Credit Crisis is one part true and at least two parts, and probably ten parts, Beautiful Lie.
I don’t claim to understand all the ins and out of credit failure and the current malaise, but I do believe that once the effect of low oil prices permeates the economy, the credit situation will look different. Thus, the crisis mongers have to step it up NOW and intensify if they want to get a piece of the action. If too much time passes without giving mucho bucks without precondition to the ‘needy’ , the scam might look a little more obvious.
The best way to hustle someone is to make them think they have limited options, they have to make a decision NOW or terrible consequences will occur, and pressure them into a decision from many sides all at once. Then make sure the only decision they can make is one from your option list.
Paulson has either seen the light and is breaking the rhythm, or is trusting people who plan to rob him and the rest of us blind.
November 12th, 2008 at 4:15 pm
Anyone think he gets an invite to stay on in the new admin ?
Well, Bush used anti-’ Crisis Interruptus’ as his platform in 2004 and Obama will be in Chicago this weekend as the world dishes it out ex-China. So anything is possible. Can anyone say advisory committee for King Paulson?
November 12th, 2008 at 4:22 pm
Hey Leftback let’s start a corporation.
November 12th, 2008 at 4:32 pm
& dead hobo: “or is trusting people who plan to rob him and the rest of us blind.”
I’d say Paulson is one of them. Laughed at your “bullshit meter” and “sad story” lines.
November 12th, 2008 at 4:34 pm
Dead Hobo wrote, “The best way to hustle someone is to make them think they have limited options, they have to make a decision NOW or terrible consequences will occur…. ”
Like what Paulson and Bernanke did to Congress for the initial $700 B bailout?
November 12th, 2008 at 4:35 pm
TARP is simply a way to end around FDIC collapse. Banks get cash (at bazooka point), have their tax status revamped (yay! say the bankers) and now healthy banks are buying unhealthy ones so that the FDIC does not have to. Imagine the impact on American society if the FDIC went tits up. There wouldn’t be lines at the bank of citizens trying to get their cash, there’d be troops.
My .02
SGIP
November 12th, 2008 at 4:48 pm
@ Dead Hobo:
You’re right.
November 12th, 2008 at 4:51 pm
Soylent Green Is People Says: “Imagine the impact on American society if the FDIC went tits up.”
I’d argue its insolvent figuratively now by insuring far more than it has in reserves so it is “tits up” . And only needs a slight push to be there literally.
November 12th, 2008 at 4:53 pm
pat,
FDIC is backstopped by the federal government.
Are you saying the USG would go Tango Uniform?
chuck
November 12th, 2008 at 4:58 pm
Chuck:
Do you think that’s an impossibility? Did you know that there are credit default swaps on the U.S.? And that they’ve been going up in cost lately?
November 12th, 2008 at 5:00 pm
Maybe I’m a Pollyanna, but this might be a Volcker moment. Rather than breaking the back of 17% inflation, the scammers and hustlers have been sent off in disgrace. Yahoo business news has stories of massive layoffs in the financial world.
Amazing!
It only took a couple of hours, if that, to decide that the End of Times is here due to this decision. It appears a little pre-packaged to me. So long, goodbye, and don’t call to the financial parasites who will be leaving us soon. Ditto to the bonus payments that Uncle Sam won’t be providing this year to some.
November 12th, 2008 at 5:05 pm
Pat
Impossible: no
Unlikely: yes
P.S. I’m an optimistic person by nature. If the USG goes bankrupt, there isn’t a whole lot that I could do at present time without substantial cost. At least by being poor, I’ll have lots of company
November 12th, 2008 at 5:05 pm
How about TARP Interrupted? Like that movie about a girl with borderline personality disorder locked away in a mental asylum But, Hank Paulson is no Angelina Jolie :)
November 12th, 2008 at 5:07 pm
I’ve heard everything to explain the action such as today from Nov 15th redemption deadlines and the Hedge funds doing the prisoners rush to the gates…. to AIG exploding, …. to GE exploding of which informed money, whatever the hell that means, is rushing to the exits… to this is all purposeful market shaking by Hank and the boys to drive funds into the treasury market as that is THE market that must be fed at all cost especially now considering their funding requirements. Don’t know. What seems clear is the US Govt cannot issue debt at this pace, else default or outright printing is a certainty. Seems like short of the decade being set up is the long end of the treasury curve as well as bucky. Lets see what the G20 has to say this weekend. A rabbit up their sleave. Doubt it. Dante, meet perdition.
November 12th, 2008 at 5:10 pm
Dead Hobo:
Your not a Pollyanna. Believing that someone has your back because its in their best interest is faith and we all want that to be the case. Unfortunately, its not. But keep the faith!
November 12th, 2008 at 5:14 pm
@ dead hobo:
“I was right in a former life when I ridiculed oil prices …”
That you, Cinefoz?
November 12th, 2008 at 5:19 pm
Bait and switch?! Hammerin’ Hank Paulson is MasterBait and switch. The guy was always a concrete skulled tool. He has become the human conduit through which tax dollars that may never be collected are being siphoned off to the material benefit of a few at an unprecedented pace. These bastards know exactly what they’re doing.
Scott in Chicago
November 12th, 2008 at 5:23 pm
Re: commodity stocks
Yes, they have fallen tremendously and look cheap. But with deflation looming, I won’t be buying those stocks anytime soon. In fact, I’m still in SMN.
Good luck.
November 12th, 2008 at 5:24 pm
Mind Says:
November 12th, 2008 at 5:14 pm
@ dead hobo:
“I was right in a former life when I ridiculed oil prices …”
That you, Cinefoz?
_________________________________________________________________
I remember him. He appeared excessively strident when the naked short sellers tried to present themselves as a victim class. He came across as outraged that organized theft was being presented by pundits at a natural right of humanity. Haven’t seen him.
November 12th, 2008 at 5:27 pm
Barry, I LOVE your blog (this is my first post). As a prior poster pointed out, threaded discussion would really take it to the next level. Any chance of getting that?
November 12th, 2008 at 5:31 pm
As per VennData’s post, I’d like to begin to see a “culture change” on this blog. Instead of adding to the American (cable news mentality) of dissing people constantly and bantering on about what “morons” everyone else is, could we not provide critical, yet graceful, comments about our leadership. While I think Paulson headed originally in a horrible direction, I do congratulate him on figuring it out before he signed the checks.
I don’t want to come across condescendingly, but really, America needs far less of the Fox News and MSNBC type extreme rhetoric and MORE thoughtful, articulate, and respectful dialog. I think Barry’s blog is one of the places this could concievably be found. (My two cents).
Does anyone else agree?
November 12th, 2008 at 5:36 pm
barry,
How about that bottom call? Haha.
November 12th, 2008 at 5:36 pm
Does anybody really know what’s going on in this so-called credit crisis? One has to ask after reading this commentary by Bob Eisenbeis at Cumberland, wherein he discusses the claim by FRB Minneapolis economists that the four issues below are myths:
Lending to nonfinancial corporations and individuals has declined sharply
Interbank lending is essentially nonexistent
Commercial paper issuance by nonfinancial corporations has declined sharply and
Banks play a large role in channeling funds from savers to borrowers.
November 12th, 2008 at 5:41 pm
Threaded discussions?
Sure its possible —
I am still learning WordPress — but its on the short list for the next few plug ins
November 12th, 2008 at 5:45 pm
Great call on the GE Capital debt Barry – apparently you knew 2:30 what we didn’t find out until 4:05… well called.
November 12th, 2008 at 5:45 pm
Re: Barry’s bottom call
I think Barry’s call was a good one. I believe he said it was a tradable bottom, not the final cyclical bottom. And even though he probably expected the rally to last longer than this, it was long enough and strong enough (maybe 14% or so) to make money.
November 12th, 2008 at 5:52 pm
re: bottom call
Barry had moved 55% of his money into the longterm bull camp. Not raging bullish, but considering he’s using 2x funds (aka the same leveraged mistake everyone else has made) he’s certainly in pain now.
This is no market to be a hero in. Barrys another bear turned bullish too early….alas.
November 12th, 2008 at 6:23 pm
Not to be a doom and gloomer, but:
The only thing missing from Mr. Paulson’s press conference today was Bill Paxton looking into the camera and whimpering “game over man. Game over.” That, or a photoshop of Hank on the ark with a T Rex bearing down on him (NSFW).
All joking aside, pull up money center banks in your Bloomberg terminal. Apple is now more valuable than Citigroup and Wachovia combined. Hell, Mr. Jobs’ company is worth more than C and BB&T combined, and BB&T actually conducted itself with aplomb and sobriety in the last ten years.
To my eyes and ears (yes, starting sentence with infinitive. Shadup), this is Paulson’s best and perhaps only viable way of signaling to the equity markets that the writing is on the wall, and that nothing Treasury can do at this point will prevent banks from experiencing the inevitable, whatever the inevitable may ultimately entail.
Bolstering credit card companies, keeping students in school, making sure people can still get around: these are the actions of a technocrat trying to keep the basic fabric of our lives from unraveling; not moves designed to right a banking industry already hanging by a thread.
Unlike some of the other tongue-in-cheek “bring on the armageddon” comments, I’m not heading out to Walmart tonite to buy ammo. But, whereas in times past I would have dismissed the idea of a 70% correction, Dow 4,000 looks mighty attainable without flawless economic execution from the new administration.
November 12th, 2008 at 6:38 pm
http://online.barrons.com/article/SB122633310980913759.html
“Cutting through the technical jargon, the yield curve and the credit-default swaps market both indicate the markets are exacting a greater cost to lend to Uncle Sam. And it’s not because of anticipated recovery, which would reduce, not increase, the cost of insuring Treasury debt against default.
All of which suggests America’s credit line has its limits.”
November 12th, 2008 at 6:44 pm
Some technicals….
850 was a very important to hold and bounce from today. “If” we were still in some sort of ABCDE pattern from the 10/10 lows, then this current leg down should be the D wave and it should have bottomed at the .7862*B=D at 850 and ricocheted higher. Instead, the market just sort of slowly traded down to that key level and then the market closed. With futures getting hit overnight, tomorrow does not look so good. Unless something radically changes overnight, we seem poised to set new lows and eventually trade down to the 768 level…which will be a great level to buy. We should be seeing some terrific Daily and Weekly RSI divergence on any new lows, which is what you want to see before even considering getting into a market.
Heard some nitwits on CNBC talking about the triple bottom holding….I guess they never heard the ol’ saying about Triple Bottoms and Triple Tops never holding. A “triple bottom” on the SP500 at this point would be a hugely rare technical phenomenon.
All that being said…sentiment is SO bearish right now. All the headlines are bearish…. We are definitely setting up for a very strong countertrend rally at some point very soon, but I’d rather dip my toe in on new lows nearer 768…
I wonder what hugely bearish event will occur at the lows that triggers the massive reversal day? There are so many possibilities to choose from…..Autos filing for Ch.11? GE pre-announcing terrible earnings? Some kind of sovereign debt default? GS announces massive loss?
Happy Trading to All….
Regards,
AT.
November 12th, 2008 at 6:58 pm
“Federal Bailout May Include Credit Card, Loan Companies” headline from Wapo….
The bad/good news is if they miss a payment, the TARP* loans go to 29% interest, and there are hidden fees, and it will effect their moodies, s&p, and fitch ratings….
*misnomer; should be brb, meaning banks recapitalized with billions, or, of course, be right back… (as the looters run off with what they can salvage)
November 12th, 2008 at 7:16 pm
I wonder what hugely bearish event will occur at the lows that triggers the massive reversal day?
Hank Paulson kicked out and replaced by someone we all trust.
November 12th, 2008 at 7:19 pm
guess they couldn’t agree on how to price “troubled assets” after all…
November 12th, 2008 at 7:25 pm
Random Note on GE stock price….sorry it’s OT but GE is such a bellweather I thought it would be interesting to the Blog.
I posted a technical note on GE back when it was trading 22.50 that any break of 22.5 (61.8% lifetime retracement) would target the 13.50 level as the 78.62% lifetime retracement. There’s another interesting technical level coming for GE as well….$14.68. $14.68 would be a very large A=C target in % terms. Beginning in 2000, GE fell 64.6% for an initial A wave down. The C wave started at $42.15….a 64.6% decline from 42.15 targets $14.68.
So basically, the $13.48 – $14.68 zone on GE stock represents an extremely great risk/reward level, technically speaking. I wouldn’t want to see GE decisively break this zone…next stop would be ZERO.
- AT
November 12th, 2008 at 8:05 pm
“ZERO” GE has got to be able to buy itself at a penny a share and make itself whole, and say goodbye to sharing anything.
“heading out to Walmart tonite to buy ammo”
can you believe the Republican spin machine is already blaming Obama for those ammo sales (from the standpoint the Dems are going to take our guns) … how about this standpoint (we expect the economy to get out of hand)
November 12th, 2008 at 8:06 pm
Not to put too fine a point on the discussion, but today a previous CEO of Goldman Sachs says he now thinks the downturn will be worse than the Great Depression.
http://www.reuters.com/article/Finance08/idUSTRE4AB7HT20081112
Whitehead sees slump worse than Depression
He should talk with Roubini and get cheered up……..
November 12th, 2008 at 8:07 pm
AT: Not sure what will happen tomorrow but I agree that 850 is a huge technical. I am long stocks, but highly selective, basically all in the commodity space. See you at 770 some time for sure, maybe tomorrow, maybe later on, maybe 2009. I was somewhat encouraged by the fact the market didn’t scream down in the last hour.
November 12th, 2008 at 8:27 pm
Leftback:
If you are long the market, please note the intel and AMAT news tonight. Amat is cutting its workforce by 12 per cent and intc came out with bad news too.
Amat is much more diversified than they were in 1998, and even so, the stock is under 10 bucks tonight. As you also probably know, they are the world’s biggest supplier of chip making equipment….be careful with your longs. This market is like none other in our lifetime.
November 12th, 2008 at 8:44 pm
So TARP could include student loans?
On the ropes from $40 to $1 because of student loans: FMD, basically trading assuming bankruptcy if they are not able to securitize this year, particularly with TERI already in Bankruptcy.
Investment bank with a large stake in FMD: Goldman Sachs.
November 12th, 2008 at 8:55 pm
leftback:
Indeed…the slower and somewhat grinding descent of todays action had me thinking we might bounce pretty hard at 850…I actually tried to buy futures at 850 and sort of got mildly chopped up a little on the close….I don’t like the action on the sp futures tonight and I don’t like how the Yen is shaping up tonight as it looks headed to 107ish. Basically, there’s nothing bearish looking about the Yen or the 10 yr, which normally doesn’t bode well for stocks and commodities….so stay safe out there.
- AT
November 12th, 2008 at 9:46 pm
Barry: will you be on the bid tomorrow or is doubt creeping in on the bottom call?
November 12th, 2008 at 10:08 pm
There is now an internecine race between the Nikkei and the Dow. The first to zero “wins”…both 8200 tonight.
November 12th, 2008 at 10:29 pm
It is easy for all to see (including the markets) that Hank and Ben are nothing more than MAD FINANCIAL SCIENTISTS, mixing their smoking test tubes together, creating a Frankenstein monster that will threaten us all.
November 12th, 2008 at 10:48 pm
psst – I’m skating around the ammo issue
primarily it is Washington and Wall Street with its hands to deep in the till
but these are real too:
a. a sucessful assasination of Barack
b. bored supremacist egging for a fight
November 13th, 2008 at 12:44 am
Buy some coffee while you’re at it, apparently it is cheap now. More insanity – is the world really going to suddenly drink less coffee?
Commodity Online
Coffee prices have been caught in the vortex of the global markets meltdown. Coffee prices have declined by nearly 20% in the last two months thaniks to the financial crisis appears.
According to statistics from International Coffee Organisation (ICO), the global coffee market is reeling under the financial crisis that has contributed to the widespread liquidation of financial securities including contracts in commodities futures markets, leading to marked downward corrections to their value.
It said coffee prices have fallen sharply during the month of October in the context of the financial crisis that seems to be exerting downward pressures on virtually all commodity prices, ICO said.
It added that in the last two months coffee prices have declined by nearly 20%.
November 13th, 2008 at 12:03 pm
DP-
Actually yes, the world, in recession or worse, will drink less coffee, eat less rice, etc., all the way up to really kick ass cuts of beef. Less of all of it. That falls under that crazy supply and demand econ. 101 thing…
Scott in Chicago