Afternoon Linkfest
Let’s revisit the old linkfest days:
• U.S. Is Said to Prepare Filing for Chrysler Bankruptcy (New York Times) See also Who killed Chrysler? (Fortune)
• Mr. Geithner Flexes Muscles: The Treasury Secretary Tells Investment Banks Government Is in Charge That was seen Tuesday in his disabusing the Street’s investment banks from the idea that they get to decide when they can pay the government back on funds received through the Troubled Asset Relief Program, or TARP. The final call on that, Mr. Geithner made it clear (Wall Street Journal)
• Fed’s Bear Losses Dominated by Commercial Real Estate (Bloomberg) The Federal Reserve released its most detailed breakdown to date on the types of assets it accepted from Bear Stearns a year ago and the cause of losses on the portfolio. The biggest losses in the $25.7 billion portfolio of Bear Stearns assets as of the end of last year came from commercial and residential mortgages, according to a report released by the Fed in Washington today.
• U.S. mass layoffs rise to highest on record: Large-scale U.S. layoffs rose again in March, according to Labor Department data on Thursday, as the economy struggles with what many expect will be the country’s worst post-World War II recession. (Reuters)
• The Goldman Conspiracy: 10 reasons why Wall Street has absolute power over America’s democracy (Marketwatch)
• Thievery Under TARP: We are being robbed big-time, but you can’t say we haven’t been warned. Not after the release Tuesday of a scathing report by the Treasury Department’s special inspector general, who charged that the aptly named Troubled Asset Relief Fund bailout program is rife with mismanagement and potential for fraud. (The Nation)
• Gold: Inflows into ETFs up by more than 300% Figures from the World Gold Council show that investors appetite for gold showed no sign of abating with record inflows in to gold exchange traded funds. (The Telegraph)
• Bloomberg Housing 3-fer:
- -Rising Home Vacancies Give Bernanke Extra Time to Withdraw Cash
- -Mortgage Bondholders Form Battle Lines Over Obama Housing Plan
- -Hamptons Home Prices Plummet 23% as Summer Home Demand Cools
• What’s a Global Recession? The International Monetary Fund was slow to apply the word “recession” to the current global downturn, partly because it didn’t have a good definition (and partly because it didn’t want to spook markets and IMF members). (Real Time Economics)
• Stress Tests Flash a Lot More Red: Federal bank regulators are expected on Friday to start sharing preliminary results of stress tests with the banks that have been scrutinized since February. The findings are expected to be made public next week. (Wall Street Journal)
• Banking credit catch-22 in action? (FT Alphaville)
• 60% Say Government Has Too Much Power, Too Much Money Just nine percent (9%) say the government has too little power and money. Twenty-four percent (24%) believe the government has about the right amount of both (Rasmussen)
• Top Ten Tech Cocktail-Party Questions: I can’t help noticing that the same questions tend to come up over and over again. Here they are, then: the Top Ten Pogue Cocktail-Party Questions (and Their Answers). (David Pogue)
April 23rd, 2009 at 6:06 pm
Rasmussen is about as Red State as they come, Barry.
I like this poll a lot better:
Poll: Obama’s popularity breeds optimism
April 23, 2009 09:54 AM
The Associated Press-GfK survey released today found that for the first time in more than five years, more respondents believe America is on the right track than the wrong track.
In the poll, 48 percent said the country is headed in the right direction rose to 48 percent, up from 40 percent in February, while 44 percent say the nation is on the wrong track. Still, it’s the first majority for “right direction” since January 2004, shortly after the capture of former Iraqi dictator Saddam Hussein.
Coming up on 100 days in office, Obama’s job performance rating is still high at 64 percent, though down slightly from 67 percent in February. Former President George W. Bush’s approval ratings hovered in the high 50s after his first 100 days in office.
http://www.boston.com/news/politics/politicalintelligence/2009/04/poll_obamas_pop.html
April 23rd, 2009 at 6:10 pm
60% are also so full of dung.
They poll one way and vote the extreme opposite when it comes time to replace the inept, corrupt, and cluless.
April 23rd, 2009 at 6:23 pm
@flip:
The only thing that’s full of crap is Mr. Rasmussen’s polling. Why doesn’t he release his methodology, which is something Gallup, ABC, CBS, AP, and every other reputable polling organization does?
April 23rd, 2009 at 6:35 pm
Here’s another link, from yesterday’s local paper:
Industrial vacancy in Las Vegas at seven-year high
April 23rd, 2009 at 6:57 pm
franklin-
vast right wing conspiracy?
April 23rd, 2009 at 7:01 pm
[...] Afternoon Linkfest [...]
April 23rd, 2009 at 7:34 pm
Rasmussen probably polls Jerry Boyer, Don Luskin, Larry Kudlow, Art Laffer and a few other stuck in the sand dinosaurs.
April 23rd, 2009 at 7:36 pm
It sounds like the Chrysler creditors are ready to go to the mat, I think they should, we have established bankruptcy laws.I’d rather take my chances with a bankruptcy court than trust a devious tool like Tiny Tim.But Timmy’s weak, they’ll call his bluff and he’ll fold. His stock answer is it would be worse if he hadn’t folded. This could ALWAYS be worse thats the refrain as the economy sinks and the deficit soars…
April 23rd, 2009 at 8:04 pm
franklin,
if you weren’t so predictable, you might, actually, be funny to observe.
way to jump on the “Ink Blots”..
instead of noting that this: “…Scene 3. Wall Street’s ‘quiet coup’ also runs world’s banking system
There’s another equally disturbing expose in “The Quiet Coup,” Simon Johnson’s great article in Atlantic magazine. A former chief economist at the International Monetary Fund, Johnson also warns that America’s “financial industry has effectively captured our government” and is “blocking essential reform.”
Worse, he says that unless we break Wall Street’s stranglehold (unlikely in the new Washington) we will be unable “to prevent a true depression,” warning that “we’re running out of time,” echoing many of our predictions of the “Great Depression II” coming soon. See previous Paul B. Farrell.
Scene 4. Wall Street used the meltdown to take over America’s government
Matt Taibbi, author of “The Great Derangement,” captured this drama in a Rolling Stone piece, “The Big Takeover, how Wall Street insiders are using the bailout to stage a revolution.” A must-read: “As complex as all the finances are, the politics aren’t hard to follow. By creating a crisis that can only be solved by those fluent in a language too complex for ordinary people to understand, the Wall Street crowd has turned the vast majority of Americans into non-participants in their own political future. … in the age of CDS and CBO, most of us are financial illiterates.”
Wall Street “used the crisis to effect a historic, revolutionary change in our political system — transforming a democracy into a two-tiered state, one with plugged-in financial bureaucrats above and clueless customers below.”
Scene 5. How Obama is keeping alive Bush’s ‘disaster capitalism’
Back in 2007 at the start of the meltdown, Hank was misleading us in Fortune: “This is far and away the strongest global economy I’ve seen in my business lifetime.” In the real world, Naomi Klein, author of “The Shock Doctrine: Rise of Disaster Capitalism,” was warning us that “during boom times it’s profitable to preach laissez faire, because an absentee government allows speculative bubbles.”
But “when those bubbles burst, the ideology becomes a hindrance and goes dormant while big government rides to the rescue.” Then, free-market “ideology will come roaring back when the bailouts are done. The massive debts the public is accumulating to bail out the speculators will then become part of a global budget crisis.” TARP paybacks: Obama has a new “disaster capitalism.”…”
was, believe it or not, under the marketwatch.com banner, you go “Red State/Blue State” like some sad refugee of Skinner’s box
April 23rd, 2009 at 8:15 pm
@ rktbrkr-
that’s one take- the other is that Chrysler is liquidated and any brand such as Jeep going to the highest bidder. Their is massive over capacity- some companies are going to go down- the creditors, from what I have read come out better in a BK than what the USG is offering. Let’s get rid of the dead wood and push on I say although I was quite fond of the new Challenger- that’s one bad ass car.
April 23rd, 2009 at 8:25 pm
Moss @ 7:34
Maybe so. But the pollsters on the other side aren’t any better.
A lot of pollsters probably try to influence public opinion as much as measure it.
April 23rd, 2009 at 8:49 pm
@DL:
Maybe so, but Gallup doesn’t have paid banner ads from organizations relating to the issue it’s supposed to be “impartially” polling about on its website.
You can’t even pretend they’re impartial when they have paid advertising from right wing lobbying groups like the American Issues Project.
quote:
The American Issues Project is a political action group organized as a 501(c)(4) nonprofit, so that it can engage in limited amounts of civic campaigning, but cannot legally advocate for or against candidates.[1] During the United States presidential election, 2008, it became known for commercials linking Barack Obama to former Weather Underground founder William Ayers.[2] The group has received substantial media attention.[3][4] After Obama came into office, the group concentrated on the American Recovery and Reinvestment Act of 2009.[5]
The AIP was co-founded by conservative political activists Tony Feather (also a co-founder of the conservative 527 group Progress for America) and Chris LaCivita. [6] [2]
Funding for AIP, which spent close to $3 million for the Ayers ads, is provided by Harold Simmons.
http://en.wikipedia.org/wiki/American_Issues_Project
April 23rd, 2009 at 9:20 pm
On another note, all is not well with our northern neighbor. Biggest GDP contraction since 1961.
http://www.nytimes.com/aponline/2009/04/23/business/AP-Canada-Economy.html?_r=1
April 23rd, 2009 at 9:21 pm
Excuse me – it’s the biggest contraction since these records started being kept in ‘61. They’ve now more than doubled their estimate to the downside for the year.
April 23rd, 2009 at 9:36 pm
I like how “Mr. Geithner Flexes Muscles” is right after the NYT article about the Chrystler bankruptcy, which was largely dictated to the government by the big banks.
OT: Did anyone see the post on Zero Hedge about the Goldman principal trades? That’s insane. I can only offer two explanations
1. Goldman has a secret program trading formula that is doing really well at the moment
or
2. As the author of the blog says, massive market manipulation
April 23rd, 2009 at 9:47 pm
Mannwich @ 9:20
From the link you provided:
“[Mark] Carney [the central bank chief] blames inaction in the United States … in dealing with toxic bank assets for a recession that has been deeper and longer than expected”.
Screw Mark Carney.
April 23rd, 2009 at 9:49 pm
franklin411 @ 8:49
Noted.
April 23rd, 2009 at 9:54 pm
franklin- ever afraid of the other side- sidelining his hero- fear not young man- there is no conspiracy- Obama will succeed or fail on his own merit- so do not be faint of heart of any derogatory thing that comes along- Obama will have plenty of time to prove his worth- be not like die hard Bushies- do not stick with him thick or thin- be willing to accept any failings that become apparent.
April 23rd, 2009 at 10:20 pm
The big thing that is overlooked is that these banks have Chrysler debt because thay were stuck with it. Now they are screaming that the gov is sticking it to them. Be a big boy and admit to your mistakes.
April 23rd, 2009 at 10:21 pm
was, believe it or not, under the marketwatch.com banner, you go “Red State/Blue State” like some sad refugee of Skinner’s box
Mark, ever read Temple Grandin’s book “Animals in Translation”?
http://www.templegrandin.com/templehome.html
Funny anecdote about her meeting Skinner at Harvard when she was just a young kid — and he tried to put the moves on her. Even funnier if you know that she is autistic.
April 23rd, 2009 at 10:50 pm
http://zerohedge.blogspot.com/2009/04/equity-market-recap.html#disqus_thread
You all might want to read the thread under the post, particularly the comment by one ‘molecool’.
April 23rd, 2009 at 11:10 pm
Chrysler is the Auto Lehman. They have about 3000 dealer ships in US and 450 in Canada. Since they are half or a third a size of GM. The govt can see what the preliminary reaction an impact will be for GM in June.
If this is allowed to happen, then it will make us different from Japan. I never see it mentioned, but Japan’s biggest issue and the reason for the banks being left as zombies, was due to the banks and business being so intertwined. Equity ownerships went both ways for banks and business, then the loans.
April 23rd, 2009 at 11:16 pm
MRegan:
I really wish I could understand those charts. What is the giant outlier at the SPX 851 mark in the top graph at ZeroHedge?
Interesting that at the NY Fed link POMOs are authorized “to maintain conditions in the market for reserves consistent with the federal funds target rate set by the Federal Open Market Committee (FOMC).”
As a non-trader never would have occurred to me that such an animal existed, not in a million years. Interesting — did a search for the exact wording of the POMO explanation and only got 13 hits on the whole Web.
Can you open the Excel file from this link? http://www.ny.frb.org/markets/pomo/display/template/dspToExcel.cfm
April 23rd, 2009 at 11:19 pm
“The Treasury Secretary Tells Investment Banks Government Is in Charge That was seen Tuesday in his disabusing the Street’s investment banks from the idea that they get to decide when they can pay the government back on funds received through the Troubled Asset Relief Program, or TARP. The final call on that, Mr. Geithner made it clear”
After wading through that several times, I tried the article. I am left wondering if cutbacks at the WSJ have left the janitors in charge of the editing room. Really crappy writing.
April 23rd, 2009 at 11:19 pm
Nevermind, the .cfm file is just html code for the daily list of POMOs.
April 23rd, 2009 at 11:28 pm
MRegan @ 10:50
I’m going to take the liberty of posting what you referred to. More evidence of a PPT. I’m not entirely dismissive of a PPT, provided that their objective is very short term in nature. The question is, when is the “PPT” going to stop “pumping” and start “dumping”.
…………………….
“There has been a distinct spike in POMO activity as of late. Direct Intervention to manipulate a variety of markets appears to be accomplished primarily via two vehicles: “Repo” Injections from The Fed, and via the Over The Counter (OTC) Derivatives reported by The Bank for International Settlements. The Fed makes injections of Repos (Repurchase Agreements – - usually TOMOs – - Temporary Open Market Operations typically expiring in 1 to 30 days) into the market nearly every business day. In recent months TOMO operations have dried up as the Fed found more covert avenues to inject liquidity to be used for market manipulations.
Repurchase agreements are loans (at Fed Fund rates) issued daily by the Federal Reserve to Primary Dealers, the proceeds of which can be used to buy, for example, Dow index futures, if the Fed seeks to boost the Dow. The total amount of un-expired Repos on any given day constitutes the “Repo Pool.” Monitoring daily changes in Repo Poll levels (which is publicly available information) is crucial to determining how the Interventions will likely affect the markets.
Thus, the several Primary Dealers (e.g. Goldman Sachs, JPM. Citibank), who work under the Fed’s direction, are able to use these loaned funds to buy or sell various securities and futures to affect the markets. Now get this: One species of Repos, POMOS (Permanent Open Market Operations), never has to be repaid, which is extremely significant. The fact that the loaned funds can be used to purchase Derivatives (as well as plain equities) gives the manipulators the tremendous leverage which derivatives afford”
April 23rd, 2009 at 11:39 pm
The historic record only goes back to 8/25/2005.
One of the big POMO dates was Tuesday, 4/14/2009.
DL, you’ll appreciate this. At 3:44 pm on that day you wrote “PPT is slacking off today.”
http://www.ritholtz.com/blog/2009/04/spx-earnings-changes/#comment-162181
However, the following day, Wednesday April 15, we have this:
call me ahab Says:
April 15th, 2009 at 4:01 pm
what was the last hour rally all about? People want in on tomorrows earnings reports?
http://www.ritholtz.com/blog/2009/04/say-hello-to-frannie/#comment-162392
Hmm… spooky!
April 23rd, 2009 at 11:46 pm
I’m not one of those conspiracy-theorists (really, I’m not!), but I’m more convinced now than ever of the existence of the PPT in some form. This late day (final 1-1.5 hr, especially the final 15-20 minutes where it really ticks up) consistent pumping virtually every day for weeks on end now just doesn’t seem natural to me.
April 23rd, 2009 at 11:55 pm
For about a year, a gold dealer I know has been harping on these OMOs and their use to manipulate the gold/dollar ratio. I never realized there were permanent grants, to an uber class of money men, that never have to be repaid. If this is the case (and, apparently it is), it makes the concept of the PPT look quaint. We have no idea who governs us (or is that ‘owns us’?) , and by what means they took that power.
April 24th, 2009 at 12:12 am
MA,
that’s a significant example of why good Gold Dealers are worthwhile associates..LSS: their Markets are contra to the “Paper Is, it really Is, Money/ Buy MutFunds for the Looong Terrm-Crowd”
Transor,
I hadn’t read the book, though not surprised re: Skinner–many of those Psyche-ologists should have been on a Professional’s Couch, rather than Professing..
this: Can you open the Excel file from this link? http://www.ny.frb.org/markets/pomo/display/template/dspToExcel.cfm though, is really funny. Reminded me of the stunts we used to pull in CompSci–Hey, my drive can’t read this disk–Could you see if it’ll boot in your ‘pute?
April 24th, 2009 at 12:24 am
Okay, so I’ve been spending the last 40 minutes reading this out-of-date article from the Federal Reserve Bulletin.
http://www.federalreserve.gov/pubs/bulletin/1997/199711lead.pdf
I can barely understand the use of the open market operations in conjunction with the discount window to control reserve quantity OR federal funds rate.
It looks like issuing or redeeming federal securities is the OMO mechanism, with some callable and almost all of the POMOs not callable (almost because I saw a “C” on one list). So I don’t see where the alleged link between S&P purchases/PPT activities and OMO would lie.
Anybody willing to take a stab at explaining this alleged link to me?