David Jackson writes:
This is a financial crisis. The financial leadership in this country CANNOT be trusted.
David Jackson | Homepage | 03.17.08 - 9:30 am | #

ZIRP-USA writes:
We should enlarge the confessional. Like make an 8th continent or something.
ZIRP-USA | 03.17.08 - 9:35 am | #

ac writes:

This is a financial crisis. The financial leadership in this country CANNOT be trusted.

That's why we have to expand their authority on an emergency basis. So they can fix this mess and become trustworthy again.

ac | 03.17.08 - 9:36 am | #

Jill writes:
Sorry to repeat from previous thread, but while I'm getting coffee, chomp on this:

Jill writes:
As the Black Swan said over at Mish's Blog, "if this doesn't scare the crap out of you, nothing will."

http://www.telegraph.co.uk/money...7/ ccview117.xml

Foreign investors veto Fed rescue
By Ambrose Evans-Pritchard, International Business Editor
Last Updated: 9:53am GMT 17/03/200

"It is unsettling to watch the world's reserve currency disintegrate. Commodities from gold to oil and wheat are taking on the role of safe-haven 'currencies'. The monetary order is becoming unhinged."
Jill | 03.17.08 - 9:30 am | #
Jill | 03.17.08 - 9:36 am | #

Peripheral Visionary writes:
The emergency room is at capacity these days; it may be necessary to do triage and determine who gets surgery, who gets a prescription for pain meds, and who gets sent to the coroner.
Peripheral Visionary | 03.17.08 - 9:36 am | #

blogenfreude writes:
@David Jackson - Bush is sounding like Hoover ... http://thinkprogress.org/2008/03...er-bush-hoover/
blogenfreude | Homepage | 03.17.08 - 9:37 am | #

Outsider writes:
Any sweaty hands here this morning?
Outsider | 03.17.08 - 9:38 am | #

Marcus Aurelius writes:
Hoover: The vacuum cleaner of the President? Based on the sucking sound, I'd have to go with the former.
Marcus Aurelius | 03.17.08 - 9:38 am | #

probert writes:
We should issue CMBS to finance a confessional enlargement project. I propose to destroy Bear's HQ and instead have Trump build a confessional, based on his "You're fired" trademark.
probert | 03.17.08 - 9:39 am | #

liberal writes:
One trick to make stocks look cheap is to use a P/E measure where only nonnegative E is added to the aggregate. (That is, if a firm has negative E, it's counted as 0.)

With these huge losses, I wonder what's happening now? (When I looked during the last crisis, there was usually little difference between the two measures, but during the crisis (viz, tech bubble burst) they diverged quite a bit.)

I used to use Barra to get those kinds of numbers but I don't think they make them available anymore, could be wrong.
liberal | 03.17.08 - 9:40 am | #

Jill writes:
Oops, make that:

http://www.telegraph.co.uk/money...7/ ccview117.xml

Fingers no workie yet.
Jill | 03.17.08 - 9:40 am | #

sterlingerl writes:
This hardly seems relevant under the circumstance, but in case anyone is watching the other economic news, industrial production was down, due to weather.

WASHINGTON (MarketWatch) -- U.S. industrial output dropped by 0.5% in February, the Federal Reserve reported Monday. The decline was largely a result of a weather-related 3.7% decline in utilities' output. Analysts surveyed by MarketWatch were looking for an overall decline of 0.2% in February. The capacity utilization rate, meanwhile, fell to 80.9% from 81.5%.
sterlingerl | 03.17.08 - 9:42 am | #

ac writes:

Bush is sounding like Hoover ... http://thinkprogress.org/2008/03...er-bush-hoover/

Just think, if FDR had been elected 4 years earlier we'd probably be comparing Bush to him.

Whoever get's elected in 2008 might go on to wish they hadn't.

ac | 03.17.08 - 9:42 am | #

Misean writes:
Had to happen on my birthday.

Time to head to the bunker.

Wonder what the Wright Model B is saying today.

Cheers,
Misean | 03.17.08 - 9:43 am | #

ac writes:

As feared, foreign bond holders have begun to exercise a collective vote of no confidence in the devaluation policies of the US government. The Federal Reserve faces a potential veto of its rescue measures.

I like that idea.

Asian, Mid East and European investors stood aside at last week's auction of 10-year US Treasury notes. "It was a disaster," said Ray Attrill from 4castweb. "We may be close to the point where the uglier consequences of benign neglect towards the currency are revealed."

I guess it's Americans piling into treasuries right now? If we didn't have that "disaster" 10-year yields might be negative already.

ac | 03.17.08 - 9:46 am | #

Moments of Inertia writes:
Misean,

Happy B-day!

Happens to be my dad's too. I hope he doesn't ruin it and look at his Ret. acct. today. I tried to warn him. Oh well.
Moments of Inertia | 03.17.08 - 9:46 am | #

mal writes:
Top o' the mornin' to you, Guvnor Paterson... ain't it a moity foine day fer a swearin'-in?
mal | 03.17.08 - 9:46 am | #

Matti Kinnunen writes:
Check Bloomberg:

http://bloomberg.com/apps/news?p...vKkw& refer=home

``This is a serious crisis,'' said David Goldman, senior portfolio strategist at Asteri Capital in New York and former head of debt research at Banc of America Securities LLC. ``Something is systemically very wrong and we're at a very dangerous moment.''

`Get Out'

``The Fed is throwing the dollar out of the window,'' said Jim Rogers, chairman of Rogers Holdings, in a Bloomberg Television interview from Singapore. ``Everyone listening should get out of the dollar,'' said Rogers, who predicted the start of the commodities rally in 1999.

U.S. Treasury notes rose, causing the 10-year yield to fall 10 basis points to 3.36 percent as traders bet the U.S. central bank will lower its benchmark rate by a full percentage point when it meets tomorrow.

Gold for immediate delivery climbed as much as 3 percent to a $1,032 an ounce as investors sought a haven against the weakening dollar. Crude oil gained as much as 1.4 percent to $111.80 a barrel.

``The dollar is facing a credibility crisis,'' said Koji Fukaya, a senior currency strategist at the Tokyo unit of Deutsche Bank AG, the world's largest currency trader. ``All the markets are entering a vicious cycle.''

What a mess!
Matti Kinnunen | Homepage | 03.17.08 - 9:47 am | #

justintime writes:
Happy b-day MP.
You can use the candles on your cake to light the bunker.
Wiley E. may be at that point now!
justintime | 03.17.08 - 9:48 am | #

tj & the bear writes:
Happy B-day Misean!!!

Top of the mornin' to everyone else! Let's see where this goes, shall we?
tj & the bear | 03.17.08 - 9:48 am | #

MPinCO writes:
Amusing how progressives (thinkprogress) whine while it was 'progressive' policies of the 90's that got us to where we are today. Their fix? Well, more progressivism.

Idiots
MPinCO | 03.17.08 - 9:49 am | #

Canuck writes:
Talking heads on CNBC going on about this being the "final washdown to stabilize the markets".

Considering how much toxic paper and nonexistent value is still out there, I'm stunned anyone can say this with a straight face.
Canuck | 03.17.08 - 9:50 am | #

Tom Stone writes:
If Bush is Hoovering his favorite candy he will be energetic and upbeat...
Tom Stone | 03.17.08 - 9:50 am | #

r0m30 writes:
sort of OT: Is the new buyers incentive in NYC CRE "Buy an office building and get a primary broker for free?"
r0m30 | 03.17.08 - 9:50 am | #

Marcus Aurelius writes:
Hey, Misean. Missed you yesterday. Thought you had been banned, or that you had fallen, and couldn't get up.

Happy B'day.
Marcus Aurelius | 03.17.08 - 9:52 am | #

Kicker writes:
Misean,

Happy B! Day...
Kicker | 03.17.08 - 9:52 am | #

Misean writes:
Thanks all.

Interesting times.

Cheers,
Misean | 03.17.08 - 9:52 am | #

ac writes:

``The dollar is facing a credibility crisis,'' said Koji Fukaya, a senior currency strategist at the Tokyo unit of Deutsche Bank AG, the world's largest currency trader. ``All the markets are entering a vicious cycle.''

That's because we don't have enough rate cuts and bailouts to prop up the dollar.

Maybe when we get to the end of all this we'll realize the only solution to these kinds of problems is not to **** everything up to begin with.

The idea of "cleaning up the mess after the party" has been the recipe for financial ruin IMO. Alas, it may mean economic ruin also.

ac | 03.17.08 - 9:52 am | #

Marcus Aurelius writes:
MPinCO | 03.17.08 - 9:49 am

____


Your "conservative" spin dies with the dollar.
Marcus Aurelius | 03.17.08 - 9:53 am | #

Jill writes:
Many happy returns, Misean! I'll bet you'll remember this one.
Jill | 03.17.08 - 9:53 am | #

Misean writes:
Marcus,

Well, went out Saturday...yesterday was a bit painfull.

Cheers,
Misean | 03.17.08 - 9:53 am | #

Kp writes:
So if I rent out a safe deposit box and put the little money I actually have in it....is that better than leaving as 1's and 0's in some computer tape drive?

Should I forgo the negative interest iI am earning in my bank account and grab the cash while I can?
Kp | 03.17.08 - 9:53 am | #

cd writes:
The market is holding up suprisingly well..Haven't touched 200 yet
cd | 03.17.08 - 9:53 am | #

Kp writes:
PS

Happy Birthday Misean.

and on St. Patty's Day no less.
Kp | 03.17.08 - 9:54 am | #

Jill writes:
Gag me, Bush is speaking.

"challenging times"
"we've taken action"

blah blah blah
Jill | 03.17.08 - 9:56 am | #

Matt writes:
here goes bush!!!
Matt | 03.17.08 - 9:56 am | #

Interesting Times writes:
BSC has a 42% Divi! What a deal!
Interesting Times | 03.17.08 - 9:57 am | #

Matt writes:
in the long run our economy will be fine.

awesome!

how long is the long run now?
Matt | 03.17.08 - 9:57 am | #

Jill writes:
I love it! CNBC is making fun of Bush's remarks!! Will wonders never cease.
Jill | 03.17.08 - 9:57 am | #

ac writes:

The market is holding up suprisingly well..Haven't touched 200 yet

And still above recent lows IIRC.

ac | 03.17.08 - 9:57 am | #

blogenfreude writes:
Cheney and McCain are in Iraq, where it's probably safer.
blogenfreude | Homepage | 03.17.08 - 9:57 am | #

sportsfan writes:
Gag me, Bush is speaking.

He just exudes confidence and his soothing words make me feel sooooo much better
sportsfan | 03.17.08 - 9:59 am | #

zig writes:
the PPT is hiring. This market is so freaking manipulated. down 100, yeah right. I suppose the PPT is looking for orderly carnage. The funeral homes can only take so many people at a time.
zig | 03.17.08 - 9:59 am | #

Tom Stone writes:
420 visitors at 5 to 7 on the west coast.
Tom Stone | 03.17.08 - 9:59 am | #

Matti Kinnunen writes:
Bush taking action! Sounds scary. Everyone take cover - especially in Iran. Maybe another war could take world attention away from the ongoing financial meltdown, would it not.
Matti Kinnunen | Homepage | 03.17.08 - 9:59 am | #

zig writes:
MAYBE IRAN, me thinks
zig | 03.17.08 - 10:00 am | #

tj & the bear writes:
Someone keeps trying to pump this thing and hammer gold & silver, but can't manage to keep it going. Where's my tinfoil hat, 'cuz it smells like the PPT.
tj & the bear | 03.17.08 - 10:00 am | #

piter writes:
Agreed PPT is out in full force today.
piter | 03.17.08 - 10:01 am | #

Marcus Aurelius writes:
Re: Bush

When you're a hammer, every problem looks like a nail.
Marcus Aurelius | 03.17.08 - 10:01 am | #

tj & the bear writes:
LEHMAN diving again.
tj & the bear | 03.17.08 - 10:02 am | #

Kicker writes:
Frick...

Somebody help me here. The utilities seem like a screaming buy right now but I can't bring myself to buy in.

Why?
Kicker | 03.17.08 - 10:02 am | #

Glenda writes:
If Bill Clinton hadn't run up the dollar index to 120, it wouldn't have fallen so far!
Glenda | 03.17.08 - 10:02 am | #

Jill writes:
BSC is only down 88% this a.m. Old news, but amazing to see it with my own eyes.
Jill | 03.17.08 - 10:03 am | #

Jill writes:
"but I can't bring myself to buy in"

Gee, I wonder why ;-)

:
Jill | 03.17.08 - 10:04 am | #

Kicker writes:
Gee, I wonder why ;-)

Yields are 6%! Chinese utilities are yielding 9% + currency appreciation!

Maybe it will get better?

In the depression, utilities had 15% yields for a while in the dash-for-cash.
Kicker | 03.17.08 - 10:06 am | #

cd writes:
leh looks great to play on swings today..
cd | 03.17.08 - 10:07 am | #

REBear writes:
Why is BSC trading at 3.50 and not 2? Is it short covering?
REBear | 03.17.08 - 10:07 am | #

Don writes:
Happy b-day MP.
You can use the candles on your cake to light the bunker.
Wiley E. may be at that point now!
justintime | 03.17.08 - 9:48 am

Generally speaking, when Wile E. lights a "candle" in the bunker it does not end well.
Don | Homepage | 03.17.08 - 10:08 am | #

Jill writes:
PPT = principal players theory?

I've forgotten.
Jill | 03.17.08 - 10:09 am | #

MPinCO writes:
Marcus Aurelius writes: Your "conservative" spin dies with the dollar.

The dollar devaluation started decades ago. Socialism always ends in the same way, doesn't it?

The US hasn't had conservative leadership in decades.
MPinCO | 03.17.08 - 10:09 am | #

Marcus Aurelius writes:
Beep! Beep!
Marcus Aurelius | 03.17.08 - 10:09 am | #

Marcus Aurelius writes:
PPT= Plunge Protection Team
Marcus Aurelius | 03.17.08 - 10:10 am | #

Canuck writes:
PPT == Plunge Protection Team, folks with big money ready to prop up the stock markets at a moment's notice to stave off a crisis of confidence.

At least, that's the suspicion.
Canuck | 03.17.08 - 10:10 am | #

JJL writes:
Folks all is well, Hank Paulson just said that our banks (except BSC) are EXTREMELY strong and will come out of this mess even stronger! We are all worked up over nothing.

Relax, don't do it
When you want to go to it!
JJL | Homepage | 03.17.08 - 10:10 am | #

Misean writes:
Don,

Good point.

Cheers,
Misean | 03.17.08 - 10:11 am | #

Zarathustra writes:
CNBC commentary:

"The markets are behaving very oddly right now. The DOW is down 0.8%, the S&P down 1.5%, NASDAQ down 2%. The DOW is not giving you an accurate reading."

Then they quickly cut to commercial.

I'm not joking.
Zarathustra | 03.17.08 - 10:11 am | #

Anonymous writes:
Short covering this AM. Thats why Bear is so far above 2 and JPM is up big.
Lets see what happens later today.
Short interest is huge and could keep the downside limited for awhile.
Anonymous | 03.17.08 - 10:12 am | #

tj & the bear writes:
Wow, the pump monkeys are really working overtime.  Guess I'll have to wait before I short everything that even looks like an IB.
tj & the bear | 03.17.08 - 10:12 am | #

Moments of Inertia writes:
-Legs furiously pumping
Until the last animal is jettisoned.

This is the end.

Of LEH?
Moments of Inertia | 03.17.08 - 10:12 am | #

bluestatedon writes:
"Amusing how progressives (thinkprogress) whine while it was 'progressive' policies of the 90's that got us to where we are today. Their fix? Well, more progressivism."

Horseshit. I'm a frequent visitor to that site, and I'd like you to point me to a comment or story on that site that supported or otherwise encouraged the crazy mortgage lending practices that are at the core of these problems. In fact, your so-called "progressives" are almost unanimously opposed to the deregulation of the financial and banking industry that's occurred over the last number of years, notably the 1999 act doing away with Glass-Steagall that was signed into law by Clinton, one of his worst acts as President.

I would never say that "progressive" solutions to economic problems are always and in perpetuity the best way to deal with things, but considering how it's been a Republican MBA in the Oval Office for 8 years, 6 of them with his party in control of Congress, not to mention a very pliable Supreme Court that's ruling very much in favor of business interests these days, it's laughable that you're trying to pass off responsibility for the current situation solely onto the backs of "progressives." My 90-yr-old mother is a classic New Dealer, and her conservative and prudent handling of her finances and money puts Bush and the numbskulls on Wall Street to shame.

But I expect as much; after all, isn't it all Clinton's fault?
bluestatedon | 03.17.08 - 10:13 am | #

Anonymous writes:
No PPT fellas.
Monster shorts being unwound.
Patience....
Anonymous | 03.17.08 - 10:14 am | #

Marcus Aurelius writes:
Harvard MBA = Daddy had the money. Nothing more.

Short the Ivy League.
Marcus Aurelius | 03.17.08 - 10:15 am | #

zig writes:
definition of PPT

http://en.wikipedia.org/wiki/ Wor...nancial_Markets
zig | 03.17.08 - 10:15 am | #

12th Percentile writes:
I just sold all my ultra shorts. Nice returns, going to wait out the rally that will happen tomorrow and the on the good news that all the large writeoffs this week are the last ones.

They will not let this market crash. appparently they have the means to pull that off.

Is it too early to start drinking?
12th Percentile | 03.17.08 - 10:16 am | #

cd writes:
12th-I agree
cd | 03.17.08 - 10:17 am | #

ac writes:

If Bush is Hoovering his favorite candy he will be energetic and upbeat...

"President, you're no Herbert Hoover."

ac | 03.17.08 - 10:18 am | #

M-F writes:
Anyone who tries to blame this whole debacle on the progressives or liberals needs their head examined.

Clinton and the republican congress certainly bear blame for recinding Glass-Steagall but this story is really about how markets became unregulated to enable greed. Political special interests paying off both parties to go against the interests of the people.

Improperly regulated markets with light enforcement will self destruct on a regular basis and that is what we are seeing now.
M-F | Homepage | 03.17.08 - 10:18 am | #

vader writes:
ac

Hoover was much smarter than Bush II and was much more experienced.

But he was dogmatic and the dogmatism made things worst. Like Bush. Keep in mind, he ordered the Army to fire on unarmed civilians because he feared and loathed the common citizen. Like Bush II. It put the country on the verge of revolt.

FDR was pragmatic, surrounded himself with smart folks and find a solution. The odds is that if FDR had been elected 4 years earlier, there would have been no US Great Depression. A bad recession but not what happened.

"Its the leadership stupid".
vader | 03.17.08 - 10:18 am | #

Jill writes:
Is it too early to start drinking?

12th Percentile, are you in UK? Go for it!
Jill | 03.17.08 - 10:19 am | #

ac writes:

Short interest is huge and could keep the downside limited for awhile.

It might take a 2000 point DOW rally to get all that short interest cleared out to pave the way down.

Especially with the Fed ratcheting up the bubble blowing policies.

ac | 03.17.08 - 10:19 am | #

zig writes:
Down 57.

we are going to green today??? the whole world will now not trust us if this happens. what a charade. The new york shlock exchange.
zig | 03.17.08 - 10:19 am | #

Anonymous writes:
12th -
Alot of people are doing what you did this AM and thats the reason for the relative strength.
Patience people. Fundamentals are horrible and no bank should be trading for more than tangible BV right now. They will get there. Patience....
Anonymous | 03.17.08 - 10:20 am | #

Alec writes:
It's well past 2 here in Frankfurt, gonn have a bier or 2 @ dippemess with all the $ I made for $5 and have been selling for 15 euro for my pocket money
Alec | 03.17.08 - 10:20 am | #

12th Percentile writes:
East coast in the land of the Bush Peso. Still morning.

I'm a big fan of patience. I don't see big leg down this week. could be just the shorts, but I doubt it. Same thing has happened for four months now. If I hear one more person mention Wile E Coyote I might actually take it as a buy signal.

I'll wait for it to run up again. I'm confident it will. If not, its been a good year so far.
12th Percentile | 03.17.08 - 10:24 am | #

blackhat writes:
Market should do that little up-tick for a few hours and then buckle.

More GOAT-LEGGINGS!
blackhat | Homepage | 03.17.08 - 10:24 am | #

Anarchus writes:
Isn't it staggering that there's currently almost 200 bp between 90 day tbills and FFs?

In past crises 100 bp would usually mark the peak in Fed complacency.
Anarchus | 03.17.08 - 10:26 am | #

byzantine_ruins writes:
The old stone mill might grind slow but it grind fine. Patience, people. As someone said yesterday, they have the PPT, but the shorts have gravity.
byzantine_ruins | Homepage | 03.17.08 - 10:26 am | #

numbersman writes:
Maria is on Bubblevision early this morning, making absolutely no sense at all. I thought she might have a blouse on, with the top two buttons undone.
numbersman | 03.17.08 - 10:29 am | #

MPinCO writes:
bluestatedon writes:
Horseshit. I'm a frequent visitor to that site, and I'd like you to point me to a comment or story on that site that supported or otherwise encouraged the crazy mortgage lending practices that are at the core of these problems....

In the post titled Bernanke on Fostering Sustainable Home Ownership -
http://calculatedrisk.blogspot.c...nable- home.html there is a chart that shows the distinct break up starting in 1994. You can draw a straight line to 2005. I believe it was in 1992 or 93 that the Boston Fed tossed out traditional lending criteria, calling them outdated. The Fed found discrimination where none was. The new criteria is how we got to where we are today. In fact 'regulation' required use of new criteria.

On top of tossing out traditional criteria we have a Greenspan Fed creating bubble after bubble that inflated the 'market' asset price.
MPinCO | 03.17.08 - 10:30 am | #

Anonymous writes:
"The idea of "cleaning up the mess after the party" has been the recipe for financial ruin IMO. Alas, it may mean economic ruin also.

ac "

With any real luck, it'll mean a lot of murdered rich scum. That would be the only justice.
Anonymous | 03.17.08 - 10:30 am | #

Matti Kinnunen writes:
If the PPT bought enough shares of public companies to keep economy afloat, would that not amount to socialization of private enterprises?

Is that not against the prevailing ideology of free markets?
Matti Kinnunen | Homepage | 03.17.08 - 10:31 am | #

beachblvd writes:
I don't trust the Daily Telegraph, see if you can get another source on that Jill.
beachblvd | 03.17.08 - 10:31 am | #

ac writes:

But he was dogmatic and the dogmatism made things worst. Like Bush. Keep in mind, he ordered the Army to fire on unarmed civilians because he feared and loathed the common citizen. Like Bush II. It put the country on the verge of revolt.

FDR was pragmatic, surrounded himself with smart folks and find a solution. The odds is that if FDR had been elected 4 years earlier, there would have been no US Great Depression. A bad recession but not what happened.

I honestly have no basis for agreeing or disagreeing. I don't know that much about the period though I'm fond of a revisionist history where Hoover was a martyr who single-handedly saved the nation.

If Hoover was too hands off I think there's every possibility that we could make the opposite mistake and be too hand on.

Or, more realistically, we might look back and say we had a serious economic downturn precisely because we advertised "heavy intervention" as some kind of panacea in a major crisis and used that as an excuse to mismanage our economy and finances in epic new ways.

I think the solution is not in solving crises, but avoiding them. I still think we're implicitly advocating that "cleaning up after the party" is a viable alternative.

At least nobody has repudiated this type of thinking.

And in the end I think there's absolutely nothing the government can do to make up for a complacent uninformed population. I think any claims that they can are highly toxic to our future.

ac | 03.17.08 - 10:31 am | #

Anonymous writes:
markets going to green shortly...
Anonymous | 03.17.08 - 10:31 am | #

Zarathustra writes:
CNBC commenting more on Dow being out of sync with SP500 & Nasdaq.

Here's a relevant post from Roubini's blog:

"From the other day:
The key words from it were: "that’s when you see the DOW out of synch with the others"

@ JMa… I’m posting this under “guest” since some of my co-workers check this sight out too.

The other day, I told you I thought you made the right move (short) based on what was in the pipes. (I couldn’t talk about it, especially not from work) I’m surprised it took a day or 2 for the news to come out about BS.

It actually started a couple days earlier, when a couple large players (word scramble – oldmang achss & ehmanl) were backing out of derivative deals when they found out BS was on the other side of the deals. Word shot around quickly. (I figured Wolf in Wilds would’ve also heard about this before the street???) The freeze was on!!! Thus the pending collapse. I thought the FGN markets got wind of this, thus I thought word was out. (maybe it was and there were some positioning unwinds taking place??? I can only speculate.)

Anyhow… you made the right call and it should’ve paid out.

…but it didn’t based on the silly games that are being played. (the financial war I’ve talked about, and especially the recent propping that just started taking place. (“PPT” did not exist like the “day trader” most people on this sight babble about… but just recently, they have actually started to buy equities so they will become the day trader that they’ve been accused of being. (that’s when you see the DOW out of synch with the others.)))

Anyhow, the BS drop is the first player that has been voted off of the tribe. (as we are now at the merge of “Survivor Wall St”, and it is now every institution for themselves!)

As for JPM helping out… they are BS’s clearing custodian, and broker dealer. They had todo it.

Guest H
Zarathustra | 03.17.08 - 10:31 am | #

Douglas Watts writes:
The US hasn't had conservative leadership in decades. MPinCO | 03.17.08 - 10:09 am | #
---

Hoover/Coolidge 08 !!!!
Douglas Watts | Homepage | 03.17.08 - 10:32 am | #

safe_as_apartments writes:
We need MORE COWBELL!
safe_as_apartments | 03.17.08 - 10:32 am | #

Anonymous writes:
ALERT: Fed cuts discount rate to increase predatory lending

Deadbeat loans a 'cure-all' says Bernanke
Anonymous | 03.17.08 - 10:32 am | #

Rigged writes:
Dow going green...comical
Rigged | 03.17.08 - 10:32 am | #

Jill writes:
I thought she might have a blouse on, with the top two buttons undone.

She usually does. Gets her those free rides on the corporate jets, not to mention ratings. (Sorry about that, Maria.)

The teevee boys mostly agree: "They just chose $2 per share out of thin air."
Jill | 03.17.08 - 10:32 am | #

tj & the bear writes:
Wow, another shot straight up. Un-friggin-believable. I'm going back to bed.
tj & the bear | 03.17.08 - 10:32 am | #

zig writes:
we are green.... BULL SHITE
zig | 03.17.08 - 10:33 am | #

Anonymous writes:
American banks crater. Global markets crash.

American markets up.

Fuck this bullshit market. Kill all of Wall Street slime.
Anonymous | 03.17.08 - 10:33 am | #

byzantine_ruins writes:
Is that not against the prevailing ideology of free markets?

The Bush Admin (and many or even most American "conservatives" of the current era) are fascists, not traditional conservatives. They have no problem with commingling private and state interests. In fact, most of them heartily believe that what's good for Big Money is good for America.
byzantine_ruins | Homepage | 03.17.08 - 10:35 am | #

Anonymous writes:
" Socialism always ends in the same way, doesn't it? "

You mean lopping off the heads of the criminal rich scum?

Sounds like a just resolution to me.

Where do I sign up?
Anonymous | 03.17.08 - 10:35 am | #

Anonymous writes:
Man, you guys are a bunch of babies.
Patience.
Jeez, no wonder the markets are up. All the shorts are folding.
Patience, we will be down 10% from here in the not too distant future...
Anonymous | 03.17.08 - 10:35 am | #

Alec writes:
those are T-shirts I made for $5
Alec | 03.17.08 - 10:36 am | #

Jill writes:
You're not suggesting that the markets are an unequal playing field, I hope! Heaven forbid.
Jill | 03.17.08 - 10:36 am | #

Average Joe writes:
Can't turn the heat up to high or the Frog will jump out of the water.

Slow burn
Average Joe | 03.17.08 - 10:37 am | #

blackhat writes:
Don't fret. Wait a few hours for positions to really unwind...we'll be back down 200pts. Really.
blackhat | Homepage | 03.17.08 - 10:37 am | #

ac writes:

Hoover/Coolidge 08 !!!!

Amen to that.

ac | 03.17.08 - 10:37 am | #

Marcus Aurelius writes:
Everybody settle down.

What did you expect - that the criminals wouldn't fight to keep their plunder?

Does anyone here have even a shred of confidence that this rally is fundamentally sound?

This is a carrot. You are a horse. Do NOT try to eat the carrot.
Marcus Aurelius | 03.17.08 - 10:39 am | #

Zarathustra writes:
Guest H is inside the beast somewhere. He makes occasional and cryptic posts on Roubini's blog that end up being uncannily accurate.

He has successfully called the major market tops and bottoms of the past six months - within hours. He's made money for lots of people.

In one of his earlier posts, he said this was a shakedown and financial war on wall street - certain major players are systematically eliminating/absorbing competitors. Once this process is complete and the major players are properly positioned, the market will be allowed to fall. Until then, we are all pawns in a major wall street power struggle.

Hence the comment about BSC being voted off Survivor Wall Street.
Zarathustra | 03.17.08 - 10:39 am | #

Anonymous writes:
"Is that not against the prevailing ideology of free markets?
Matti Kinnunen"

That is sooo 1960's. Hippie!
Anonymous | 03.17.08 - 10:39 am | #

ac writes:

Patience, we will be down 10% from here in the not too distant future...

(Right after being up 20%)

ac | 03.17.08 - 10:40 am | #

Douglas Watts writes:
In fact, most of them heartily believe that what's good for Big Money is good for America.
byzantine_ruins | Homepage | 03.17.08 - 10:35 am | #
--
More correctly, the ruling cabal believes as gospel that America and Big Money are one and the same. The problem with Corporatism is demonstrated by the exact situation we face today. Corporations, driven by short-term monetary objectives, cannot be trusted to act in their own long-term interest, or respect basic bounds of an advanced technological open and democratic society. Intelligent regulation is good because it rewards long-term thinking instead of penalizing it.
Douglas Watts | Homepage | 03.17.08 - 10:42 am | #

cd writes:
MA-Damn carrots are healthy though, gotta go for the celery for now on
cd | 03.17.08 - 10:42 am | #

Matti Kinnunen writes:
@Anonymous:

Yes, I have long hair and red beard!

But I do think that while socializing the companies, the PPT should also confiscate their recent bonuses.
Matti Kinnunen | Homepage | 03.17.08 - 10:42 am | #

Film at 11 writes:
Zarathustra-

Do you have a link? I know it's a subscription site... but I'm curious about where the commenter (Guest H) posts.
Film at 11 | 03.17.08 - 10:43 am | #

Anonymous writes:
I agree Blackhat.
Who cares about whats going on right now because its eventually going down.
To read all the whining in these posts is pathetic.
"Wahhhhh!!! The game is rigged!!! PPT!!! PPT!!!"
Everyone wants instant gratification. Just like the cheerleaders on Wall Street.
Patience people.
The fundamentals and technicals stink.
Anonymous | 03.17.08 - 10:43 am | #

Zarathustra writes:
Who tried to kill gold?
Zarathustra | 03.17.08 - 10:43 am | #

Alo writes:
Zara, this reminds me more of survior - Andes style (with a planeload of starving soccer players)...
Alo | 03.17.08 - 10:43 am | #

zig writes:
bsc is at 4.70.... short covering deluxe
zig | 03.17.08 - 10:43 am | #

Interesting Times writes:
Where is the PPT getting their money?
Interesting Times | 03.17.08 - 10:43 am | #

Jill writes:
Guest H = Deep Throat

Gotta love it.
Jill | 03.17.08 - 10:43 am | #

JJL writes:
Could shorts be responsible for every single uptick that ever occurs? Seriously folks.
I think there is a ton of "support" buying by the investment banks in an effort to avoid a run on their stocks, it really could be that simple.
JJL | Homepage | 03.17.08 - 10:44 am | #

Matti Kinnunen writes:
"Corporations, driven by short-term monetary objectives, cannot be trusted to act in their own long-term interest, or respect basic bounds of an advanced technological open and democratic society. Intelligent regulation is good because it rewards long-term thinking instead of penalizing it."

Well put. Exactly to the point!
Matti Kinnunen | Homepage | 03.17.08 - 10:44 am | #

abc writes:
Talking heads on CNBC going on about this being the "final washdown to stabilize the markets".

Considering how much toxic paper and nonexistent value is still out there, I'm stunned anyone can say this with a straight face.

Are you kidding... I have been listening to CNBC since the housing market started to creak in October 2006... they have never been anything but bullish and upbeat.

CNBC is a joke, filled with crooks, liars, and frauds. Nobody should listen to anything they say.
abc | 03.17.08 - 10:44 am | #

zig writes:
amazing interview with Jim Rogers. He is pissed.

http://www.bloomberg.com/avp/ avp...psp3dpnTUuA.asf
zig | 03.17.08 - 10:44 am | #

Zarathustra writes:
http://www.rgemonitor.com/blog/roubini/

The blog is free, but you have to register and get a password.
Zarathustra | 03.17.08 - 10:45 am | #

Anonymous writes:
The PPT gets its money from the 2nd gunman in the grassy nole and the folks who built the fake lunar landing set....either that or UFOs.
Patience.
It aint the alleged PPT its the MASSIVE short positions and covering!!
Anonymous | 03.17.08 - 10:46 am | #

Just Some dumb guy writes:
http://www.europac.net/media/Sch...-3-14- 08_lg.wmv

Shiff's take
Just Some dumb guy | 03.17.08 - 10:48 am | #

Film at 11 writes:
Z-

Many thanks!
Film at 11 | 03.17.08 - 10:49 am | #

Interesting Times writes:
Anonymous - ahh now it makes sense.

PPT = market boogie man...
Interesting Times | 03.17.08 - 10:49 am | #

Douglas Watts writes:
Actually, I should have said:

Regulation is good when it rewards long-term thinking instead of penalizing it.
Douglas Watts | Homepage | 03.17.08 - 10:49 am | #

Marcus Aurelius writes:
The combined bank entity - The Legacy Bank of the US - will be bankrupt at inception. You will own the liabilities. All recourse to bonuses, stock deals, and other chicanery will have been rendered null and void in the consolidation process.

Mark these words, as I cannot emphasize them enough:

We are being robbed. Law enforcement is our only hope at this point. Too bad law enforcement is now discretionary.
Marcus Aurelius | 03.17.08 - 10:49 am | #

Zarathustra writes:
The most convincing theory of the PPT I've heard is that it is a cabal of the major ws banks acting in concert out of mutual interest and in consultation with the Working Group on Financial Markets. Traditionally their MO is through the index futures.

I don't have the link handy, but there was an interview with George Stephanapholousolousolous after 9/11 where he publicly confirmed the existence of the PPT.

I'd rather be labeled a conspiracy theorist than be one of the sheeple.
Zarathustra | 03.17.08 - 10:50 am | #

Barley writes:
Alec writes:
It's well past 2 here in Frankfurt

Pls give us a German view of the BS bailout
Barley | 03.17.08 - 10:51 am | #

cd writes:
Jim Rodgers for Fed chrmn in 2009! great rant..
cd | 03.17.08 - 10:52 am | #

ilsm writes:
They should all be shriven before they are eaten.

Does Paulson have authority for a mass absolution?
ilsm | 03.17.08 - 10:53 am | #

blackhat writes:
Et tu Bernanke?
blackhat | Homepage | 03.17.08 - 10:54 am | #

Jill writes:
What Zarathustra said.

It's always a conspiracy "theory" right up until it's proven to be correct.
Jill | 03.17.08 - 10:54 am | #

Douglas Watts writes:
The housing meltdown is a text book example of what happens in the absence of regulations that reward long-term thinking. Instantaneous gratification is not a good personal, business or societal model. Unfortunately, our consumption driven economy (caused by the decline of making stuff in the U.S.) actually depends on instantaneous gratification to survive. The concept of buy now, pay later has become this country's business model and now we are arriving at the "pay later" date ...
Douglas Watts | Homepage | 03.17.08 - 10:54 am | #

Jim D writes:
So I'm sitting here wondering why Japan drops 4%, and we only drop 2%.

Then I remember, priced in Yen, we just dropped 7% today.

Oh. Never mind.
Jim D | 03.17.08 - 10:56 am | #

blackhat writes:
o.k. shorties, get ready...
blackhat | Homepage | 03.17.08 - 10:56 am | #

ipodius writes:
It's always a conspiracy "theory" right up until it's proven to be correct.

jill what's happening right now doesn't need any ppt or anything else. anyone with a brain knows that it is completely natural. positions are being unwound, and the next death sentence will be hanged out soon. this is a case of ritual execution for show. there are valuable assets here. if you can kill the company, or part of it, you get them. enjoy the show and stay in cash, especially euro. just have some patience.
ipodius | 03.17.08 - 10:57 am | #

cd writes:
get ready for green numbers? +34 live
cd | 03.17.08 - 10:57 am | #

Sebastian writes:
Kicker asked: "Somebody help me here. The utilities seem like a screaming buy right now but I can't bring myself to buy in."

When you figure out why and resolve the conflict, I predict you'll become an incredibly wealthy investor in the future.


Sebastian
Sebastian | 03.17.08 - 10:57 am | #

gpblank writes:
Oil and gas futures down - I don't get it. Thought it would be the opposite today.
gpblank | 03.17.08 - 10:58 am | #

burnside writes:
I see your PPT and raise it one Occam's Razor.
burnside | 03.17.08 - 10:58 am | #

Sebastian writes:
(OT) 600+ posts on the previous thread, with a lot of you staying up late on a Sunday night dwelling on this thing? You guys really *are* crazy.:))) I went bed at 10 p.m. and slept like a baby.


S.
Sebastian | 03.17.08 - 10:59 am | #

zig writes:
dow up 40 on its own.....
yeah right. I am ashamed of our gvt>BB should be fired. Paulson should be given massive doses of LSD and wall street should be turned into an amusement park.
zig | 03.17.08 - 11:00 am | #

Sue writes:
Jill that DAILY TELEGRAPH article by Ambrose Evans-Pritchard - if I'm reading it correctly, he is saying that, yes, it's true that the US is debasing its currency and trying to export its debts to other nations, BUT that the other nations have no alternative but to accept this treatment.

Basically, the US is too big to fail, and if they do not accept the debased dollars, then the foreign players must be prepared for "the system" to fail and to then have to face mass economic destruction and some unknown new system rising out of that.

Am I reading his piece correctly?
Sue | 03.17.08 - 11:00 am | #

ac writes:

The housing meltdown is a text book example of what happens in the absence of regulations that reward long-term thinking.

Regulations are meaningless if the population and politicians don't understand or care about them. Look at the repeal of Glass-Stegall when it might have actually done some good. Look at our regulators' support and encouragement of subprime mortgages.

Honestly if we'd had any useful regulations that would have stopped this credit bubble I suspect they would have been ignored or legislated away.

Regulations, while necessary IMO, cannot make up for not using your brain. At best they're an adjunct, not a primary solution. I feel that too many people look to regulation as an ultimate fix.

ac | 03.17.08 - 11:00 am | #

cd writes:
dow in green-Does this = no rate cut needed?
cd | 03.17.08 - 11:00 am | #

blackhat writes:
Kicker,

Sebastion is right. Utilities are in fact structured to profit, no matter what. Return isn't vast, but very reliable.

two cents....
blackhat | Homepage | 03.17.08 - 11:00 am | #

Moral Hazards 'R' Us writes:
Schumer:

"The quality of the product is far less important than confidence"

Didn't Melville write about this?
Moral Hazards 'R' Us | 03.17.08 - 11:01 am | #

probert writes:
I went bed at 10 p.m. and slept like a baby.

Well, I bought BSC puts on Friday, I went to sleep later, and I also slept like a baby, so what's your point?
probert | 03.17.08 - 11:02 am | #

Sniglet writes:
Wow! The swift recovery of US indexes from early lows is VERY bullish, for the short-term at least. And I say this as someone who is very short the market.
Sniglet | 03.17.08 - 11:02 am | #

probert writes:
the russell 2000 is still down 1%, that's the index i look at
probert | 03.17.08 - 11:02 am | #

dunham writes:
Guys, there is no such thing as the PPT. Get over it. There are a lot of shorts however.

I'm not sure why everyone is expecting armageddon today. An IB went out of business. JPM stepped up to the plate and acquired it. The financial world will unwind slowly and methodically. This is a good thing. Anything can happen of course, but as of Friday I'm dabbling in some industrials (long) with some hedges on smaller caps/techs.

The stock market will recover before the real economy (it always does).
dunham | 03.17.08 - 11:03 am | #

Alec writes:
This is why bear markets are for pros or with folks who got lots o free time. I went overseas 4 weeks ago and got out of all my trading positions because I can't keep up to speed.

Anyway, if those financials who don't kitchen sink it this Q never will because they are probably going to zero. It's been 9 months for BS to get their act together but they tried playing cliffside game theory and lost big.
Alec | 03.17.08 - 11:03 am | #

Marcus Aurelius writes:
JPM stepped up to the plate and acquired it.

________

Your comments are disingenuous to the point of dishonesty.

JPM did NOT "buy" BSC. There is no PPT? What do you call that? Go long, I'll watch.
Marcus Aurelius | 03.17.08 - 11:06 am | #

Interesting Times writes:
Ok... so all that momentum to bring the down to even territory and halt it there was purely random?

No invisible hand...
Interesting Times | 03.17.08 - 11:06 am | #

Douglas Watts writes:
Regulations, while necessary IMO, cannot make up for not using your brain. At best they're an adjunct, not a primary solution. I feel that too many people look to regulation as an ultimate fix.

ac | 03.17.08 - 11:00 am | #
--

I agree with you. In my real life I deal with state agencies (in Maine) who often go out of their way to not enforce and implement the regulations they are supposed to enforce. They basically cherry pick which regs. they will enforce and which they will ignore. The line of defense then becomes the courts, who have the task of ensuring that executive agencies actually fulfill their statutory purposes for which they were created. It's critical to remember that all executive agencies are creatures of statute and have no independent life. Citizens have the ultimate task of policing them and keeping them in line.
Douglas Watts | Homepage | 03.17.08 - 11:06 am | #

Interesting Times writes:
down = DOW.
Interesting Times | 03.17.08 - 11:07 am | #

Marcus Aurelius writes:
Correction: JPM did NOT "buy" BSC. The FED had a hand in it, and the taxpayers will eat the loss. There is no PPT? What do you call that? Go long, I'll watch.
Marcus Aurelius | 03.17.08 - 11:06 am | #
Marcus Aurelius | 03.17.08 - 11:08 am | #

Jill writes:
jill what's happening right now doesn't need any ppt or anything else.

Mornin' idopius! No doubt you are correct, but given the speed with which the deal was done this weekend, makes you wonder where/when else they are able to work their "magic" -- maybe? Whatever.

I agree this won't last.
Jill | 03.17.08 - 11:08 am | #

dunham writes:
Market likes JPMs acquisition (JPM up $4 today). Obviously the Fed was involved.

Per Market Ticker, there is a $1 million outstanding offer from George Soros to produce a trade confirm that confirms the existence of the PPT. Have you found it?
dunham | 03.17.08 - 11:09 am | #

zig writes:
http://www.bloomberg.com/apps/ne...HR_A& refer=home
zig | 03.17.08 - 11:09 am | #

blackhat writes:
JP Morgan just bought negative value and the fed helped them. I think a few people are realizing that this is exactly nothing for either JP Morgan or Bears or "investors". If you're JP you have to assume that you just wacked a competitor (more money?) so you can compete with the rest with the big fat leverage hole you just put onto your books? Ask BofA, let me know how that's working out...market will continue to trend toward the coyote falling into the grand canyon.
blackhat | Homepage | 03.17.08 - 11:09 am | #

Jill writes:
Sue, sounds about right. I think he's preparing his readers in UK for recession.
Jill | 03.17.08 - 11:09 am | #

Sebastian writes:
probert said: "Well, I bought BSC puts on Friday, I went to sleep later, and I also slept like a baby, so what's your point?"

If you're positioned properly for your trading method and what you want to achieve (whether long or short) why lose any sleep?


S.
Sebastian | 03.17.08 - 11:13 am | #

j writes:
the world looks at us with disgust.
j | 03.17.08 - 11:14 am | #

burnside writes:
dunham,

I think we have to just give up. People who don't recognize the effects or evidence of short coverage quite yet will always and ever attribute it to the plunge protection team.

They like the idea and will not give it up until the lights - somehow, spontaneously - go on.

There's something terribly attractive about good guys v bad guys, and if you're short the necessary bad guys, you may have to invent them.

Never mind.
burnside | 03.17.08 - 11:16 am | #

M-F writes:
Its now clear that many of the losses will be socialized... why shouldn't the markets go up?
M-F | Homepage | 03.17.08 - 11:18 am | #

Interesting Times writes:
How are those YEN carry trades doing?
Interesting Times | 03.17.08 - 11:19 am | #

Cobradriver writes:
Never mind.
burnside | 03.17.08 - 11:16 am |

+1
Damn,my head hurts.

Chris
Cobradriver | 03.17.08 - 11:19 am | #

scotty_at_the_helm writes:
I'd like to continue with my solution to this problem from the last thread:

scotty_at_the_helm | 03.17.08 - 11:09 am

We need accounting reform immediately to bring about renewed trust in valuation metrics. We need FASB and CES reform today. We need to work towards accounting honesty and trust and to run accounting fraud out of America. We need to shut down SIFMA and organizations that package synthetic derivatives which have no real links to accounting. We need to restore faith in America. We need to shut down the printing presses at The Fed, we need to stop lowering interest rates, we need accountability from The Fed and we need to not save corrupt banks but to bust the crooks that are abusing The Fed and America!
scotty_at_the_helm | 03.17.08 - 11:20 am | #

scotty_at_the_helm writes:
Furthermore,

We need to let the markets fall and to have The Fed bounce around like a daytrader protecting an illusionary portfolio of favored stocks that need to be goosed in some display of discretionary abuse; poorly run companies should fail!

Amen
scotty_at_the_helm | 03.17.08 - 11:23 am | #

Alec writes:
Barley/barely(I can't remember which),

Mein deutche ist scheisse, ich bin ein Amerikaner.

That being said, I had to crash at a friend's place in Cologne because the hotels were sold out for an industrial fair.

The ECB has always made available the Fed is now doing, Italy reduced its national debt and Spain is running a surplus.

If europe doesn't decouple, it will be becaue the US crashes hard into them from behind. People are still spending.
Alec | 03.17.08 - 11:25 am | #

scotty_at_the_helm writes:
As an example of the game being rigged -- to delay implementing proper accounting, accounting which would add long-term value to corporations, versus allowing market manipulation and improper mis-stated earnings to be The Bush way of things -- and to destroy long-term American value...read this:

Oct 16 (Reuters) - The Financial Accounting Standards Board (FASB) will consider at its Wednesday meeting whether to delay a new accounting rule designed to standardize the way companies measure assets at market values.

The rule, also known as FAS 157, provides a definition and framework for how companies should determine fair value measurements -- or the price an asset could fetch in a current market transaction.

The standard is set to take effect for fiscal years beginning after Nov. 15, but has drawn opposition from industry groups who say businesses need more time to address implementation issues.

Financial Executives International (FEI), a trade group for finance chiefs, treasurers and corporate comptrollers, asked the board this month to delay the standard by a year.

"FAS 157 requires us to learn how to develop measurements of hypothetical transactions based on hypothetical market participant assumptions that may never actually manifest themselves in a transaction," FEI said in its appeal to FASB.
scotty_at_the_helm | 03.17.08 - 11:27 am | #

scotty_at_the_helm writes:
Why are we allowing accounting fraud to destroy America? How did we get to a point in this country, this world, when we allowed mafia like crooks to take over and to end up with this systemic failure that is in place?

Why do we have a Senate and Congress that is incapable of seeking justice and to protect The Constitution and The American people? These people that are in positions of power need to be accountable today!
scotty_at_the_helm | 03.17.08 - 11:29 am | #

Hokie writes:
Somebody in West Virginia just won the $275 million Powerball drawing. If only they'd been a couple of days earlier, they could have bought Bear Stearns! Darn!
Hokie | 03.17.08 - 11:31 am | #

Alec writes:
DocWheatScott,

would you just give it a rest already?
Your cut n paste jobs are killing my dataplan.
Alec | 03.17.08 - 11:31 am | #

Douglas Watts writes:
Fed Acts Boldly to Ease Crisis !
http://finance.yahoo.com/


Well, that's that.
Douglas Watts | Homepage | 03.17.08 - 11:32 am | #

j writes:
Dollar Overnight Rate Soars; Fed Move Signals Crisis (Update6)

By Gavin Finch

March 17 (Bloomberg) -- The cost of borrowing in dollars overnight rose by the most in at least seven years after the Federal Reserve's emergency cut in the discount interest rate stoked concern that credit losses are deepening.

The London interbank offered rate, or Libor, climbed 81 basis points to 3.86 percent, the British Bankers' Association said today. It was the biggest increase since at least January 2001. The comparable pound rate rose 28 basis points to 5.59 percent, the biggest gain since Dec. 31, 2007.

In its first weekend action in three decades, the Fed cut the rate on direct loans to banks and provided $30 billion to JPMorgan Chase & Co. to help the bank finance the purchase of Bear Stearns Cos., Wall Street's fifth-largest securities firm. Money-market rates are rising as banks hoard cash after at least $195 billion in losses and writedowns since the start of 2007.

``Given everything that has happened over the past few days, the market is extremely jittery, with rumors abounding about other banks out there being denied funding,'' said Sean Maloney, a fixed-income strategist in London at Nomura International Plc, a unit of Japan's largest securities company.

The Fed cut the discount interest rate on direct loans to commercial banks by a quarter of a percentage point to 3.25 percent yesterday and introduced a lending facility for primary dealers to borrow at less than the reduced rate.

JPMorgan will pay $240 million for Bear Stearns, about 90 percent less than its value last week, after clients pulled $17 billion in two days last week and creditors stopped renewing loans. The takeover ends 85 years of independence for the New York-based firm.

OIS Spread Narrows

While the overnight rate soared, the three-month dollar rate fell 18 basis points to 2.58 percent, the BBA said.

``The Fed has massively increased the market's access to three-month liquidity compared with Friday afternoon,'' said David Keeble, head of fixed-income strategy in London at Calyon, the investment-banking unit of Credit Agricole SA, France's second-largest bank. ``It's pretty clear that banks still aren't lending to one another though, and you can see that in the sharp rise in overnight rates.''

The difference between the rate banks charge for three- month dollar loans relative to the overnight indexed swap rate, the so-called Libor-OIS spread, showed an increase in the availability of cash for borrowing today. The spread narrowed by 6 basis points to 76 basis points. It averaged 10 basis points in the first half of 2007.

`Negative Reaction'

By contrast, the difference between what the U.S. government and banks pay to borrow for three months soared. The so-called TED spread widened to 192 basis points, from 160 basis points last week, the biggest increase since Jan. 22. It averaged 38 basis points in the first half of last year.

``The Fed action confirms that the liquidity crisis is worsening and that a full-on credit crunch is on the way,'' said Patrick Jacq, a senior fixed-income strategist at BNP Paribas SA in Paris. ``The market's reaction to the announcement has been entirely negative so far.''

Policy makers in the U.S., U.K., Canada, Switzerland and euro-region agreed last week to inject $240 billion into the banking system in a second round of emergency-loan offerings to counter a credit squeeze that is roiling financial markets.

The Bank of England offered extra cash to banks today in the first such emergency operation in six months to alleviate tension in money markets. It received 23.6 billion pounds ($47.3 billion) of bids for the 5 billion pounds of three-day cash offered, it said in a statement.

`Monitoring Conditions'

``This action is being taken in response to conditions in the short-term money markets,'' the bank said earlier. ``The bank will take actions to ensure that the overnight rate is close to bank rate. Along with other central banks, the Bank of England is closely monitoring market conditions.''

Writedowns of securities related to subprime mortgages will probably swell to $285 billion, Standard & Poor's said in a report March 13. The ratings company previously forecast losses of $265 billion. S&P raised its estimate because of increased loss assumptions for collateralized debt obligations.

Money-market rates began surging last year as the fallout from the U.S. housing slump left banks wary of lending to all but the safest borrowers. A first round of concerted central bank action announced Dec. 12 temporarily eased the credit shortage at the end of last year. The European Central Bank injected $500 billion into the banking system on Dec. 18.
j | 03.17.08 - 11:33 am | #

ipodius writes:
JPM did NOT "buy" BSC. There is no PPT? What do you call that? Go long, I'll watch.

Yes, they did. This isn't a cakewalk for JPM, but what they did was bought whatever value is left which, at this time, is very uncertain. However I'm sure that the powers that be at JPM realize that there's more value there than most think. Even if the marriage was a shotgun one with the Fed holding the gun yet giving a nice dowery for the gentleman's trouble.

And stop it already with the "taxpayer is going to pay" meme. It's a bunch of crap. The Fed isn't going to get stuck with anything. They are loans *over*-collateralized with the best securities. The Fed is giving JPM a hand in unwinding, and they SHOULD. That's what they're there for.

But I do suppose, as someone else said, it just requires less thought to go with the PPT crap instead of doing the analysis and relying on good analytic skills.
ipodius | 03.17.08 - 11:34 am | #

sterlingerl writes:
I think it is no secret that there is a PPT (or a Working Group, if you like). What is debatable is how much of any run up in stock price (when we expect it to be down) is attributable to the Working Group and how much is merely short covering. At the end of the day does it really matter? The trend is still down and we will get there. Just maybe not all in one day, which is kinda the point of the Working Group / PPT.
Here is an article that I think does a nice job summarising the work of the PPT. It is a few years old but useful for anyone wanting a bit more background.
http://www.sprott.com/pdf/ TheVis...VisibleHand.pdf
sterlingerl | 03.17.08 - 11:35 am | #

scotty_at_the_helm writes:
The SEC is corrupt, FASB is corrupt, FTC is not doing the job to protect consumers from wall street fraud.

The American government from top to bottom is full of ineffective people and this is the very same nepotistic network of retards that brought us all shame in The Katrina Debacle and these are the same retards that are literally and figuratively destroying America! These retards are like deer caught in the headlights of a freight train, and they have no clue as to what their jobs entail, which is because they are retarded and are underqualified morons that should not be in positions of power. The abuse of America has to wake up people today!
scotty_at_the_helm | 03.17.08 - 11:36 am | #

j writes:
Now this is the way to play the market, guaranteeed winnings.

http://www.bloomberg.com/apps/ne...Gwu8& refer=home
j | 03.17.08 - 11:36 am | #

cd writes:
J-somebody recently stated here that the best investment advice right now is to marry well!
cd | 03.17.08 - 11:39 am | #

ipodius writes:
sterlinger, what amazes me is that the same people who theorize a PPT manipulating the market will be the first ones to scream about intervention by the Fed and the laws of unintended consequences.

The markets are very, very complex beasts. There is no way that any one entity can do anything on a permanent basis...or even a semi-permanent basis. Large institutional investors are more likely to impact than anything else.
ipodius | 03.17.08 - 11:39 am | #

Zarathustra writes:
Burnside,

I believe the theory of the PPT is indeed consistent with Occam's Razor.
Zarathustra | 03.17.08 - 11:39 am | #

steelhead writes:
Fascist state anyone?
steelhead | 03.17.08 - 11:41 am | #

scotty_at_the_helm writes:
Last thing,

If we can go into Iraq on a wild goose chase for WMDs, why in the F--k can't we go into Cayman Islands, Bermuda and Switzerland and rip open the vaults of those pirates and take back Americas future? Why isn't The IRS or DOJ interested in tax evasion and accounting fraud anymore with banks like Bear that one day seemed to be worth $60.00 and then suddenly $2......that should be a wake up call for the retards that something isnt right with accounting or taxes, or banking, or government or our future......... We simply can not allow more retards to run America like a pre-Katrina daycare center that has zero accountability.

Anyone have ideas as to how to bust these crooks and get them out???? I'm serious!
scotty_at_the_helm | 03.17.08 - 11:44 am | #

scotty_at_the_helm writes:
Alec,

what cut and pastes Im just typing....ok, I did give yah the FASB thing, but you need it dude!
scotty_at_the_helm | 03.17.08 - 11:46 am | #

Uncle Ar writes:
$2 not pulled out of thin air, as mentioned above.
As someone showed last night, late last year there were 27 million options created at $1. That means all board and executives and other crooks are in the money, doubling the strike price.
Uncle Ar | 03.17.08 - 11:53 am | #

saul writes:
scotty_at_the_helm

busting them is easy as pie. Pull a Spizer on them. Who else can afford 5k an hour?
saul | 03.17.08 - 12:07 pm | #

Alec writes:
what cut and pastes Im just typing....ok, I did give yah the FASB thing, but you need it dude!

No, I don't need 6 month old information presented to me as if it's breaking news.

You're are like if the worst attributes of Tanta & Jas Jain merged in the teleportation chamber: Volume & vitriol with absoplutely zero insight or understanding.

do some searches about JPM, BofA & IBM about check clearing and explain to me how JPM doesn't have any cash.
Alec | 03.17.08 - 12:36 pm | #

MPinCO writes:
Most intelligent post of this whole comment thread:

ac writes:

Regulations are meaningless if the population and politicians don't understand or care about them. Look at the repeal of Glass-Stegall when it might have actually done some good. Look at our regulators' support and encouragement of subprime mortgages.

Honestly if we'd had any useful regulations that would have stopped this credit bubble I suspect they would have been ignored or legislated away.

Regulations, while necessary IMO, cannot make up for not using your brain. At best they're an adjunct, not a primary solution. I feel that too many people look to regulation as an ultimate fix.
MPinCO | 03.17.08 - 12:48 pm | #

scotty_at_the_helm writes:
Alec,

Sure, the FASB delay back in October is old news, but it helped get us to this point of non-accountability and systemic collapse.

You want realtime decay, go look at the screen and watch the market tank, as it digest reality, I'm just telling you the obvious, which is being in denial and to delay accountability will just continue to make this mess into a bigger pile of crap, which will be more and more difficult to control!

FASB needs to lobby Congress or we all need to wake up the retards on The Senate Banking mafia to get off their ass and do something to restore reality today!
scotty_at_the_helm | 03.17.08 - 12:54 pm | #

scotty_at_the_helm writes:
MPinCO,

The trouble is, there is not a fear of failure, no fear of "God", in that these CEOs and wall street bankers have no accountability. They front run rules and lobby to adjust regulations and then as we deregulate and have no control, no one has anything to fear.

Look at the trouble it took to get Enron busted, there had to be an inside whistle blower that brought accounting fraud to the attention of accountants, auditors, SEC and various organizations that were asleep at the wheel.

I think we can always depend on regulators to be asleep at the wheel! That said, we need martha Stewart examples in a big way now, we need lots of FBI raids and we need to see the truth and reveal what has been going on and disclose fraud and show due diligence. We need accountability and that should mean jail time for a lot of wall street crooks -- not just lip service, but put the fear of God into the homes of these corrupt assholes -- take the crooks away from the McMansions and the wonderful families and put them in realtime prisons for life!
scotty_at_the_helm | 03.17.08 - 1:01 pm | #

scotty_at_the_helm writes:
Furthermore rant 7.982a

I dont give a crap about bogus FASB GAAP, but we do need to bring about a system of accounting that is less objective, less discretionary and not prone to abuse with window dressing, padding and now exchanging and substituting fraud-embedded collateral at the fed windows......fraud is fraud
scotty_at_the_helm | 03.17.08 - 1:07 pm | #

scotty_at_the_helm writes:
Bonus Material:

The Fed at this point is like an abusive pediophile
priest at a church, where the banking congregation looks the other way, as if to approve the on-going molestation, versus the congregation standing up and saying your going to jail asshole. Why should America be chained to retarded politicians that are incapable of being accountable for their corrupt actions?
scotty_at_the_helm | 03.17.08 - 1:11 pm | #

MPinCO writes:
scotty_at_the_helm writes:
MPinCO,

The trouble is, there is not a fear of failure, no fear of "God", in that these CEOs and wall street bankers have no accountability.

Won't disagree with you except to add that this latest mess is also tainted by politically correct agendas, progressivism and socialism. It was the politically correct politicians that regulated 'no loan criteria' and then combined banks and investment houses. Under the mindset that OPM is 'free', they encouraged subprime loans and cheered on a Fed that opened the credit floodgates with negative rates.

So when you lock up the CEO's and Wall Street bankers don't overlook the politicians that played a significant role. Because if you don't they will continue to pander to the masses with OPM. It's Free!
MPinCO | 03.17.08 - 1:36 pm | #

Anonymous writes:
"There's something terribly attractive about good guys v bad guys, and if you're short the necessary bad guys, you may have to invent them."

Yeah, didn't you idiots realize everyone covers short positions with index future purchases?

Geez you tinfoil hats are dumb.
Anonymous | 03.17.08 - 4:31 pm | #