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Damn, DOW fell below 11K after a 500 pt dump! But don't worry, we're not in a recession yet.

Good news though, gas prices have fallen and I just saved some $$$ by switching to Geico!

But guys Mike gayLord said our economy is fine and that we aren't going through nor are moving towards a recession, but instead just a little "slowdown" -- Nevermind the orgy of financial data, collapsing banks, inflation, 6.1% unemployment, etc. what a douchebag. he said he worked at a brokerage, probably merrill lynch due to his disastrous judgement and terrible foresight


in other news:

http://money.cnn.com/2008/09/15/markets/markets_newyork2/index.htm?cnn=yes
Stocks get pummeled
Wall Street sees worst day since just after 9/11 attacks, with Dow down 500 points, as financials melt down.
NEW YORK (CNNMoney.com) -- Stocks tanked Monday, as investors reeled amid the fallout from the largest financial crisis in years after Lehman Brothers filed for the biggest bankruptcy in history and Bank of America said it would buy Merrill Lynch in a $50 billion deal.
Treasury prices rallied as investors sought the comparative safety of government debt, sending the corresponding yields lower. Oil prices tumbled, falling well below $100 a barrel on slowing global economic growth. The dollar rallied versus other major currencies and gold prices spiked.
The Dow Jones industrial average (INDU) lost 500 points, or 4.4%, according to early tallies. It was the biggest one-day point decline for the Dow since Sept. 17, 2001, when the market reopened for trading after having been closed in the aftermath of 9/11 terrorist attacks.


http://online.wsj.com/article/SB122...=2_1553_leftbox

AIG Tumbles 61%, Pushing
Dow to a 500-Point Decline
September 15, 2008 4:34 p.m.

The stock market suffered its worst daily plunge of the year Monday as the bankruptcy of Lehman Brothers Holdings threw the U.S. financial system into an abyss, uncertain where the bottom of its credit-related problems lies.

Lehman's demise makes it the biggest casualty yet in the long-running credit crisis, which has so far seen torrents of red ink, restructurings and acquisitions, and shutterings of a few commercial banks. But until Sunday night, no Wall Street firm of such size and stature had suffered an all-out meltdown.

The Dow Jones Industrial Average, which languished with a loss between 200 and 300 points for most of the day, saw its losses accelerate in the last hour of trading. It ended down by 504.48 points, off 4.4%, at 10917.51.

All 30 of its components fell, led by a 60.8% plunge in American International Group. The Federal Reserve on Monday asked Goldman Sachs Group and J.P. Morgan Chase to help make $70-$75 billion in loans available to the company, according to people familiar with the situation. The insurer has been racing to restructure its business and raise fresh capital to avoid a downgrade of its credit ratings



http://bloomberg.com/apps/news?pid=...fvkU&refer=home

Sept. 15 (Bloomberg) -- U.S. stocks tumbled, pushing the Standard & Poor's 500 Index to the steepest drop since the September 2001 terrorist attacks, as Lehman Brothers Holdings Inc.'s bankruptcy and declining commodities increased speculation that credit-market losses and the economic slowdown will worsen.
Stocks erased more than $600 billion in value as financial shares in the S&P 500 decreased the most since at least 1989, according to data compiled by Bloomberg. American International Group Inc. sank 61 percent and Washington Mutual Inc. decreased 27 percent. Concern the U.S. is heading for a recession pushed oil lower, prompting a drop in energy stocks, and sent General Electric Co. down 8 percent.




PS. I'll have to start a new thread "Arrived: Depression 4Q 08/1Q 09" -- unless we don't vote in a third term Bush aka McCain and get Obama administration in to start the healing process. But alas there is little anyone can do prevent the coming disasters, I just hope they will be shorter lived then I predict.

Lehman is the largest Chapter 11 case on Wall Street...

#1 LEH - $629 Billion in Pre-Barnkrupcy assets
#2 WorldCom - $103.9 Billion in Pre-Barnkrupcy assets
#3 Enron - $63.4 Billion in Pre-Barnkrucy assets

Speaking of unemployment... this week: Lehman left 25,000 people unemployed, Merrill 60,000 people... and HP just laid off 24,600 jobs.


New York housing market may feel Wall Street woes
Monday September 15, 4:43 pm ET
By Alan Zibel, AP Business Writer
Wall Street layoffs, shrunken bonuses could sap New York real estate market

Finally, New Yorkers may get a real estate reality-check.

Home sellers, agents and brokers nervously tuned in Monday to news of Wall Street titans collapsing or teetering, as Lehman Brothers Holdings Inc. filed for bankruptcy, Merrill Lynch & Co. was sold to Bank of America Corp. and New York-based insurance giant American International Group Inc. struggled to stabilize its finances.

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Until now, the New York area's housing market has been relatively unscathed by the national housing bust. While home prices in cities like Las Vegas, Los Angeles and Miami are down 25 percent or more over the past year, New York metro area prices declined about 7 percent, according to the Standard & Poor's/Case-Shiller index.

In Manhattan -- where the median-priced home cost more than $1 million -- prices were actually up 14 percent in the second quarter from a year ago. And prices in desirable suburbs are holding steady.

But Monday's cataclysm on Wall Street could be the event that finally pushes Manhattan property values downward, said Jonathan Miller, president and chief executive of real estate appraisal and consulting firm Miller Samuel Inc.

"There's an expectation that we're going to see a weakening in prices," said Miller, who declined to give a specific forecast, but did say that any price declines are likely to be moderate.

Potential homebuyers with Wall Street jobs have already been looking at smaller houses or putting off their real estate search, said Lina Panza, a real estate agent for Re/Max in Montclair N.J., who has several clients at Wall Street firms.

"It's a major, major purchase and people are nervous," she said. "They're less inclined to buy something big."

Wall Street firms have slashed the ranks of contractors and hacked at expenses like car service and business travel. Now, the roughly 25,000 workers at Lehman, as well as many of the 60,000 at Merrill, are likely to be hunting for new work.

"This can't be good, because people are losing jobs," said Ellen Bitton, chief executive of Park Avenue Mortgage Group. "Nobody would have ever thought that a Lehman would go out of business."

However, any downturn in prices is likely to be met with an influx of foreign buyers, taking advantage of the weak U.S. dollar, real estate agents say. Wealthy buyers from Italy, Russia and Great Britain in particular have snapped up properties in recent months, taking advantage of their strong currency compared with the U.S. dollar.

"Everybody wants a piece of the city," said Debra Duneier, senior associate broker with Corcoran Group. "People with money will seize the opportunity to buy real estate."

Marcus Garstein, president of Warren Lewis Realty in Brooklyn's Park Slope neighborhood, said an influx of Wall Street money helped drive up prices in recent years, but doesn't believe that demand for the area's historic brownstones will be dampened.

"There's still a lot of money in the economy," he said. Sellers, he said, are "not putting them up at fire sale prices."

And in the New Jersey, New York and Connecticut suburbs, sought-after school districts and relatively easy train commutes to Manhattan are likely to keep the housing market relatively stable.

Nevertheless, the local real estate market and the economy are both heavily dependent on the Street. While Wall Street jobs only make up 5 percent of all of New York City's workers, salaries there are so high, they represent almost a quarter of the city's total wages, according to a report last year by the New York state comptroller's office.

Such jobs, paying more than $300,000 on average, were also responsible for more than half of all income growth in New York's five boroughs in recent years.

New York's economy reaped the benefits when Wall Street financial bonuses broke records in 2006 -- estimated by the state comptroller at $33.9 billion. But this year bonuses are expected to plunge by 30 percent, according to a forecast by the city comptroller.

"Certainly, it's going to affect the real estate market," said Sandra Lippman, a real estate agent in suburban Westchester County, N.Y. "We do depend on people in the financial markets who are buying homes here

quote:

Originally posted by diskodave Lehman is the largest Chapter 11 case on Wall Street... #1 LEH - $629 Billion in Pre-Barnkrupcy assets #2 WorldCom - $103.9 Billion in Pre-Barnkrupcy assets #3 Enron - $63.4 Billion in Pre-Barnkrucy assets Speaking of unemployment... this week: Lehman left 25,000 people unemployed, Merrill 60,000 people... and HP just laid off 24,600 jobs.

Yeah, the Labor Department's September numbers that come out in the beginning of October are going to be ass fucked. Like 6.5% unemployment!

Wall Street Turmoil As Lehman Staff Pack Bags

Video:
Lehman Brothers staff were packing up their desks after word came down that there would be no bailout for the 158-year-old investment bank, Doug Luzader reports. (Sept. 15)

http://link.brightcove.com/services...bctid1785349397

LOL @ Lehman Brother's Managing Director Mo Grimeh's quote 'people are drinking beer and smoking inside..."

quote:

Originally posted by diskodave Probably AIG. WaMu is going downhill too, but i think they will get bought out at a discount.

NY Times just reported AIG has hired Law firm Weil Gotshal to draw up BK Papers and could file as soon as Weds if they can not find financing...

quote:

Originally posted by ninetyninej Yeah, the Labor Department's September numbers that come out in the beginning of October are going to be ass fucked. Like 6.5% unemployment!

AIG has 116,000 full-time employees.

It looks like the FED is going to give AIG $85 billion to save them from filing chapter 11.

I here WaMu is bound to be fucked. Am i safe banking with Wells Fargo?

(please say yes)

How about savings? Or 401k?

should keep everything as it is or should cash out and hide it in my underwear drawer?

quote:

Originally posted by diskodave It looks like the FED is going to give AIG $85 billion to save them from filing chapter 11.

well so much for free-market capitalism... i know they're trying to prevent a panic, but these government bail-outs stink of fascism. why is the taxpayer being punished for poorly-managed corporations? oh right, to preserve the illusion of investor confidence. what kind of message does this send to other corporations and to the public? "if you fuck up and your mistake is big enough, someone (the taxpayer) will be there to clean up your mess for you"? it's disgusting how the federal government and federal reserve bow to the house of cards on wall street.

quote:

Originally posted by 72hrpartyanimal I here WaMu is bound to be fucked. Am i safe banking with Wells Fargo? (please say yes) How about savings? Or 401k? should keep everything as it is or should cash out and hide it in my underwear drawer?

I am worried too, but WaMu looks to be ok as of right now. Don't jump the gun.

quote:

Originally posted by ninetyninej Yeah, the Labor Department's September numbers that come out in the beginning of October are going to be ass fucked. Like 6.5% unemployment!

i wouldn't trust the unemployment rate as a measure of severity for anything in this country. that statistic has been abused and manipulated by politicians for decades to stay artificially low as possible and so the trending means almost nothing. most economists agree that if you double this figure today, you'd be closer to the actual unemployment rate. the government gets to define what "unemployment" is and redefining it has been a habit of many presidents. if you aren't "employed" or "unemployed" you are a "discouraged worker", "marginally attached worker", "part time for economic reasons" or "persons who completed temp jobs". now there's nothing wrong with having these alternative classifications, except that if you lost your full-time job and fall into one of these categories, you aren't part of the unemployment statistic!

only people who register with the unemployment office every 4 weeks or receive unemployment benefits are counted as unemployed. when you stop receiving unemployment checks or stop visiting the unemployment office for more than a month - regardless of your employment status - you are no longer considered unemployed or part of the labor force - you are a "discouraged worker". if you work part-time, as little as 1 hour a week, you are "part-time for economic reasons". if you found work below the poverty level, you are a "marginally attached worker". if you've worked as a substitute teacher once in the last month you are a "person who completed temp jobs". then there are people who have no address and aren't counted at all. all these people aren't considered part of the 6.5% unemployed and when you hear 6.5% the assumption is that 93.5% are employed.

it's not that the bureau of labor statistics keeps bad records, but the "official" figure cited by the media as the unemployment rate ignores a huge swath of citizens who want to work full-time, but can't find a full-time job. buried in footnote u-6 of table a-12 in the bls report's "alternative measure of labor underutilization" is a more accurate statistic. in august 2008 that number is 10.8% - it's more accurate than the official unemployment rate, but it still ignores those classified as "discouraged workers". it's interesting how none of the alternative measures in the bls takes a total count of the entire labor force, just different groupings of each type of classification.

another labor statistic that's deceptive is any job growth seen in the last 7-8 years. a trick used to hide the decline of the labor force is the creation of low-pay service jobs. when a state like tennessee loses 100k manufacturing jobs and creates 110k minimum wage service jobs that pay half the income, the white paper outlook is "job growth" when the truth is that people are becoming poorer. this isn't a hypothetical situation, it's been done. unless you compare wage and employment figures simultaneously, you would think the economy is on the rise when in fact the only thing on the rise today is poverty.

you can say the same for inflation, which is realistically somewhere between 7-10% today.

Rich = SF's TA Geek!

Dave

fawk my bank is wamu! im putting my money in a swiss bank account

quote:

Originally posted by revitalizedbeat fawk my bank is wamu! im putting my money in a swiss bank account

Good luck. Some Swiss banks are putting a stop to new foreign accounts.

AIG was only need a 20B bail out on Friday but the fed refused to help out, now there putting up 80 billion..T.A.R.D's

could'da saved a good sum of money there....

AIG heading towards being a penny stock, at least they didn't have to file bankruptcy... yet. DOW down another 450 pts. Can it go below 10K?

As for WAMU, let's see if they find a buyer.

Washington Mutual Begins Efforts to Sell Itself

quote:

September 17, 2008 - Washington Mutual, the struggling savings and loan, has been working on several efforts to save itself, including a potential sale, people briefed on the matter said Wednesday. Goldman Sachs, which Washington Mutual has hired, started the process several days ago, these people said. Among the potential bidders that Goldman has talked to are Wells Fargo, JPMorgan Chase and HSBC. But no buyers may materialize. That could force the government to place Washington Mutual into conservatorship, like IndyMac, or find a bridge-bank solution, which was extended to thrifts in the new housing regulations. Citigroup is also considering an offer, but would likely be able to buy Washington Mutual only if it emerged from a receivership, according to a person close to the situation. JPMorgan is maintaining its posture that it will not bid unless it receives government support, according to another person briefed on the matter. The unsurprising announcement comes as the bank, which has suffered badly from losses on mortgages it had made, continues to stumble. Shares in Washington Mutual fell nearly 10 percent on Wednesday to $2.09; they have plunged 94 percent over the last 12 months. This week alone, investors have been frightened by Standard & Poor�s cutting of the bank�s debt rating to junk. TPG, the private equity firm that led a $7 billion cash injection into Washington Mutual in April, said Wednesday afternoon that it would waive its right to be compensated if the bank sold more shares to raise capital. �Our goal is to maximize the bank�s flexibility in this difficult market environment,� TPG said in a statement. The April deal gave the investing group roughly 822 million new shares, diluting existing shareholders by nearly 50 percent. TPG bought shares for roughly $8.75 each. Those shares have since fallen to $2.14 a share, meaning that the value of the investor group�s holdings at Tuesday�s close had declined 75.5 percent. While the bank has a strong deposit base, the uncertainty of the markets and the increasingly poor housing market have increased concerns about Washington Mutual�s outlook. The bank plunged into the option adjustable rate mortgage business.

quote:

Originally posted by djGT AIG heading towards being a penny stock, at least they didn't have to file bankruptcy... yet. DOW down another 450 pts. Can it go below 10K? As for WAMU, let's see if they find a buyer. Washington Mutual Begins Efforts to Sell Itself

I bet Wells Fargo comes in and buys WaMu to compete with BofA... but it will really come down to how nasty WaMu's books are...

quote:

Originally posted by diskodave I bet Wells Fargo comes in and buys WaMu to compete with BofA... but it will really come down to how nasty WaMu's books are...

Yeah. Well whatever happens, I am already contemplating a switch. I hate wells with a passion. Worked there and dealt with their shit long enough.

quote:

Originally posted by R!CH i wouldn't trust the unemployment rate as a measure of severity for anything in this country. that statistic has been abused and manipulated by politicians for decades to stay artificially low as possible and so the trending means almost nothing. most economists agree that if you double this figure today, you'd be closer to the actual unemployment rate. the government gets to define what "unemployment" is and redefining it has been a habit of many presidents. if you aren't "employed" or "unemployed" you are a "discouraged worker", "marginally attached worker", "part time for economic reasons" or "persons who completed temp jobs". now there's nothing wrong with having these alternative classifications, except that if you lost your full-time job and fall into one of these categories, you aren't part of the unemployment statistic! only people who register with the unemployment office every 4 weeks or receive unemployment benefits are counted as unemployed. when you stop receiving unemployment checks or stop visiting the unemployment office for more than a month - regardless of your employment status - you are no longer considered unemployed or part of the labor force - you are a "discouraged worker". if you work part-time, as little as 1 hour a week, you are "part-time for economic reasons". if you found work below the poverty level, you are a "marginally attached worker". if you've worked as a substitute teacher once in the last month you are a "person who completed temp jobs". then there are people who have no address and aren't counted at all. all these people aren't considered part of the 6.5% unemployed and when you hear 6.5% the assumption is that 93.5% are employed. it's not that the bureau of labor statistics keeps bad records, but the "official" figure cited by the media as the unemployment rate ignores a huge swath of citizens who want to work full-time, but can't find a full-time job. buried in footnote u-6 of table a-12 in the bls report's "alternative measure of labor underutilization" is a more accurate statistic. in august 2008 that number is 10.8% - it's more accurate than the official unemployment rate, but it still ignores those classified as "discouraged workers". it's interesting how none of the alternative measures in the bls takes a total count of the entire labor force, just different groupings of each type of classification. another labor statistic that's deceptive is any job growth seen in the last 7-8 years. a trick used to hide the decline of the labor force is the creation of low-pay service jobs. when a state like tennessee loses 100k manufacturing jobs and creates 110k minimum wage service jobs that pay half the income, the white paper outlook is "job growth" when the truth is that people are becoming poorer. this isn't a hypothetical situation, it's been done. unless you compare wage and employment figures simultaneously, you would think the economy is on the rise when in fact the only thing on the rise today is poverty. you can say the same for inflation, which is realistically somewhere between 7-10% today.

I knew all that but was going to keep my post short and simple.

It's funny too because some right wingers blamed the 6.1% as "high" because the fact that EDD/UI was extending participants benefits up to 2 months due to the economy being ass fucked. Citing the number "should be lower" when in reality the percentage is based on those claims that are currently receiving unemployment benefits. Like you said, once off the program, even if its just because your benefits expired and you haven't gotten a job, they drop you off the list.

The labor dept's data and unemployment info is about as accurate as the inflation figures the fed gives out -- or mike lord's secret charts and data showing the failing economy is propaganda and its just a "slowdown"

quote:

Originally posted by diskodave I bet Wells Fargo comes in and buys WaMu to compete with BofA... but it will really come down to how nasty WaMu's books are...

I was wondering when Wells was going to step up to the plate.

Be interesting if Wachovia, HSBC, or China buys it.

Wachovia is pretty likely, but they're books and balance sheet are horrendous from buying World Savings. Sooo many pick-a-pay's still haven't reset.

Fed provides additional $180 billion for short-term dollar auctions

quote:

LONDON (MarketWatch) -- Overnight borrowing costs fell Thursday after the world's biggest central banks announced they would pump billions of dollars into the financial system to soothe distressed money markets. In an unexpected announcement timed to coincide with the start of the European trading day, the Federal Reserve said it would use existing and new swap lines to provide major central banks with an additional $180 billion to be injected into money markets through overnight and other short-term loans. Short-term borrowing costs leaped this week as interbank lending ground to a virtual halt due to growing financial-sector turmoil after investment bank Lehman Brothers failed. "I think this is recognition that the time for subtlety is past," said Russell Jones, head of fixed-income and currency strategy research at RBC Capital Markets. Analysts said the injection was bound to help untangle overnight funding woes. However, easing broader tensions in the money markets would take time amid worries about solvency and fears of further turmoil, they said.

Did you like that rollercoaster ride?

quote:

Originally posted by ninetyninej I was wondering when Wells was going to step up to the plate. Be interesting if Wachovia, HSBC, or China buys it. Wachovia is pretty likely, but they're books and balance sheet are horrendous from buying World Savings. Sooo many pick-a-pay's still haven't reset.

HSBC have faired pretty well in terms of the sub-prime crunch, and they really want to get in the US market bigtime.

Well, if Goldman and Meryl go down, we're screwed....

quote:

Originally posted by DJ RANN HSBC have faired pretty well in terms of the sub-prime crunch, and they really want to get in the US market bigtime. Well, if Goldman and Meryl go down, we're screwed....

ML is down. Goldman is next, but they say they have enough liquidity to weather the storm...or so they were saying yesterday.

quote:

Originally posted by gehzumteufel ML is down. Goldman is next, but they say they have enough liquidity to weather the storm...or so they were saying yesterday.

ML down? Seriously? Oh Shit.

Goldman probably can weather it - Those guys are too powerful and wealthy to let it be swept away.

quote:

Originally posted by DJ RANN ML down? Seriously? Oh Shit. Goldman probably can weather it - Those guys are too powerful and wealthy to let it be swept away.

Yeah they went down last week dude.

Also, GS says they can weather the storm because they have other ventures and what not that are doing well, but as we have seen, don't trust what they are saying.

U.S. stocks rally on hopes for a fix from Fed

quote:

After trading in a more than 600-point range featuring triple-digit swings on either side of zero, the Dow Jones Industrial Average closed 410.03 points higher to end at 11,019.69, with all 30 of its components rising and half a dozen scoring double-digit percentage gains, led by financials. The volatile session ended on a high note as regulators hit back against short-sellers and lawmakers called for the U.S. government to create a new federal agency - similar to the Resolution Trust Corp. that gave relief to troubled savings and loans in the 1980s -- to solve the financial crisis. "The drumbeat in favor of an RTC-style federal response is growing louder by the day. Add me to the list of supporters," said Kevin Giddis, managing director, Morgan Keegan & Co. The Federal Reserve, acting in concert with its counterparts overseas, injected billions in liquidity before the trading day began in Europe, offering what proved to be only short-term relief for U.S. equities, which plunged and soared throughout the session.

Not to fear, the RTC is back to save the day!

quote:

Originally posted by DJ RANN Goldman probably can weather it - Those guys are too powerful and wealthy to let it be swept away.

Don't forget how Bear Stearn, Lehman, Fannie/Freddie were too big to fail as well. Check out the volatility today, 86 low and 120 high.

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