Economic News/Discussion

[jimzinsocal]

We should all breath a sigh of relief...DJIA just now

+110.73
(+1.04%)

Better still. +440.

Dow sticking a finger right in the eye of doom and gloom

Dow Jones Industrial Average
11,053.56 +443.90 / +4.18%
Sep 18 3:36pm ET †

The largest one-day point gain in the Dow, an advance of 499.19, or 4.93%, occurred on March 16, 2000, as the broader market approached its top.

[jimzinsocal]

McCain's Call to Fire Cox Claims Its First Victim: Chuck Schumer's Sanity
Among the more hilarious responses to John McCain's calling for the firing of SEC Chairman Chris Cox:

“Instead of firing Cox, McCain should explain how his policies differ from President Bush on this issue,” added Sen. Chuck Schumer.

How does McCain differ from Bush on this issue? Well, for starters, McCain... wants to fire Chris Cox.

I mean, I realize it's tough to spot that difference, what with it hiding in the beginning of your own sentence right there and all.
I kept looking for a following sentence that said, "Then Schumer suddenly convulsed, one eye started blinking madly, and a robotic voice from within his head began to repeat 'DOES NOT COMPUTE DOES NOT COMPUTE ENTERING SHUTDOWN MODE,' as a thin stream of smoke emerged from his ears."

[Computerwiz]

Ic still not a peep about the million dollar welfare bailouts. All it illustrates is that free market conservatives (bushies) are full of sh%t. Does this prove that the free market does not work even when the most ardent supporters can't stick by it? Why can't they "pull themselves up by their bootstraps" haha

[jimzinsocal]

Politicians speechwriters busy at work now adjusting things in light of reality

Dow Jones Industrial Average
11,019.69 +410.03 / +3.86%
Sep 18 4:08pm ET †


I expect to hear bull shit like "great American resilience in the face of adversity" and so forth and so on.

[jimzinsocal]

What drove the rise today?

From what I gather? Some talk of a Fed program to get the crap off the banks balance sheets. I talked about that before.
Evidently there is some rumored plan to create a "warehouse" so companies can park the shit loans off their balance sheets.
But it accomplishes the same thing I suggested. I suggested a special mortgage program that would have done the same thing.
Go figure. Same result different means. At least the Fed recognizes the accounting/underlying problem to be solved.
China is eliminating taxes on stock transactions.
Lots of investors bargain hunting. What a surprise.

snip just now from WSJ

Among the Dow's financial components, American International Group jumped 32.5%. Dow Jones & Co., publisher of both the blue-chip average and the Wall Street Journal, said AIG would be removed from the stock gauge and replaced by Kraft Foods Monday. Bank of America was up 12.4%, Citigroup rose 20% and J.P. Morgan Chase advanced 12.6%.
A series of news reports about various forms of government intervention in Wall Street's latest crisis bolstered investors' mood. The cable network CNBC reported that Washington is considering formation of a body to accept soured credit bets, something akin to the Resolution Trust Corp., which was a key tool to liquidating holdings of failed savings and loans in the late 1980s and early 1990s.
Also, New York Attorney General Andrew Cuomo said he has started a "wide-ranging investigation" into short selling, or bearish bets, in the financial sector. The U.K. Financial Services Authority imposed a temporary ban on short-selling financial stocks. And The California Public Employees' Retirement System, the nation's largest pension fund, said that starting Thursday it is no longer lending out shares of Goldman Sachs Group and Morgan Stanley, joining a growing list of public funds that are trying to limit short-selling of those two stocks.

[AMDScooter]

^^^ Yup.. there's still people with money out there. And IMHO.. long term they are gonna make a killing.

[jimzinsocal]

Sure there is a pile of cash out there with people. Lots of it.
Basically I think that's what McCain was getting at with his "fundamentals"
remark that was misunderstood and twisted.
American have a vast wealth of cash squirreled away and there is nothing particularly wrong with our economic system.
Despite what Obama asserts.
Is it perfect?
No of course not.
Has all risk been removed for all of us via some invasive alternative?
Thankfully no.
Does the financial sector need work? Sure.
Same way bridges need attention and repair.
Doesnt mean we shouldnt drive.

[AMDScooter]

^^^ Bingo. Simply harping on how "bad" the economy is does not match up to the facts. We have not even had negative growth.. much to the dismay of the MSM and their "recession" desires. Fundamentally our economy is strong and continues to grow.. albeit of late at a slower pace than desired. Some bumps in the road?? Fekkin-a yes. Will it cost us taxpayers? Almost certainly yes.. and to the tune of billions I'm sure. Do any of the above mean we should abandon the current system for socialism? Hell no!

[jimzinsocal]

^^Specifically? This was telling:

Obama criticized Bush administration economic policies and McCain's past support for deregulation. "The fact that we have reached a point where the Federal Reserve felt it had to take this unprecedented step with the American Insurance Group is the final verdict on the failed economic philosophy of the last eight years. While we do not know all the details of this arrangement, the Fed must ensure that the plan protects the families that count on insurance," he said in a statement. "It should bolster our economy's ability to create good-paying jobs and help working Americans pay their bills and save their money. It must not bail out the shareholders or management of AIG."

For me? It indicates an underlying animosity with shareholders and management [group]

Why slam shareholders? Who is it exactly that creates wealth and jobs?
Why slam the notion of "investor/owners"
Unless you have a bug in your ass about ownership/investment/risk taking.

[AMDScooter]

^^^ It's because he does. He wants the gubberment to have all your money so he can decide what to do with it.. for the greater good of course. Cradle to grave baby!!

[jimzinsocal]

^^Yeah. But a more granular misunderstanding on his part is the silly assumption that some bailout would "save the policyholder" and not save the shareholders.
Come on. Thats simply a stupid statement. The logic is impossible.
How does a bailout save the insured and ignore the rest of the company?

But it tells us where his head is at.

Like saving the guarantee on a car and the company vanishes. Doh. That sure makes sense.

[AMDScooter]

^^Yeah. But a more granular misunderstanding on his part is the silly assumption that some bailout would "save the policyholder" and not save the shareholders.
Come on. Thats simply a stupid statement. The logic is impossible.
How does a bailout save the insured and ignore the rest of the company?

But it tells us where his head is at.

It's pretty plain to see there is a major disconnect going on there. Perhaps the teleprompter froze on him again.

[jimzinsocal]

I think it gets at where he comes from. For him? Its all about the narrow definition of who he considers/perceives as the "suffering victim" in all this.
He considers the lowest common denominator. The insured.
In his mind? The shareholders are "the enemy". Management is the "enemy"
and he conveniently ignores the thousands of "management" people that would have been unemployed. Their pensions and profit sharing up in smoke.
The shareholders that represent JohnQAverageamerican....as part owners of the company....who expect some return on their investment.

And he wrings his hands over the "insured"

Jesus.

[falcon_view]

What drove the rise today?

From what I gather? Some talk of a Fed program to get the crap off the banks balance sheets. I talked about that before.
Evidently there is some rumored plan to create a "warehouse" so companies can park the shit loans off their balance sheets.
But it accomplishes the same thing I suggested. I suggested a special mortgage program that would have done the same thing.
Go figure. Same result different means. At least the Fed recognizes the accounting/underlying problem to be solved.
China is eliminating taxes on stock transactions.
Lots of investors bargain hunting. What a surprise.

This could cost us up to 1 Trillion $. Paulson to have congress put to gather a program to take this garbage off the street. Nobody else will give a penny on the dollar and I bet we get struck with somewhere north of .50 cents on the dollar. I would consider it only if the firms that do turn over the garbage to us that the CEOs and board members turn over their pay and bonuses from 2003.

This is just plain outrageous. With the AIG bailout of 85 Billion that is a cost to each tax payer to the tune of around $280. Do the math and see what you come up with a Trillion.

I know it might not be a Trillion depending on how much we pay for the garbage and how much will be paid by those who have the loans continure to pay the loan off or able to sell the properity at very little loss.

Nothing like corporate welfare. I don't want to hear a thing about individuals being given a hand when needed.

[jimzinsocal]

This could cost us up to 1 Trillion $. Paulson to have congress put to gather a program to take this garbage off the street. Nobody else will give a penny on the dollar and I bet we get struck with somewhere north of .50 cents on the dollar. I would consider it only of the firms that do turn over the garbage to us that the CEOs and board members turn over their pay and bonuses from 2003.

This is just plain outrageous. With the AIG bailout of 85 Billion that is a cost to each tax payer to the tune of around $280. Do the math and see what you come up with a Trillion.

I know it might not be a Trillion depending on how much we pay for the garbage and how much will be paid by those who have the loans continure to pay the loan off or able to sell the properity at very little loss.

Nothing like corporate welfare. I don't want to hear a thing about individuals being given a hand when needed.

Hey Falcon. I bet you made some gain on gold today!!

AIG? We dont know enough to tag a real taxpayer[cost] value on the loan yet.

Nobody will give a penny. Well? Thats hard to say right now.
Thats a hard assertion to make that the real value of doubtfuls is really nothing. Given how the accounting is forced to work.
I have a tough time accepting that all those houses are worth really 0

What do you figure was the cost of doing nothing with AIG?

116,000 people out of work