Closed

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http://finance.yahoo.com/intlindices

http://money.cnn.com/markets/morning_call/










http://www.kitco.com

Energy futures

Currencies/Au/Ag

Still on hols here in Oz...carry on the good work....

I can't make out if this is Bullish or Bearish




JPMorgan in Negotiations to Raise Bear Stearns Bid

From the news:




This is sad





Looks like these folks were busy over the holidayz

1) Make lowball offer to steal firm for less than the value of the headquarters building
2) "relent" and make lowball offer to steal firm for a bit more than the value of the HQ building
3) assume that you will avoid lawsuits and glean the thanks of grateful shareholders who now lose only their shirts, not their pants too
4) oops -- you just gave them evidence that you were stealing from them and now they're REALLY burned.....

Americans confident in 2009 turnaround


Let the rally continue....

Article detailing how sad it is that the BSC execs are losing big bux


Boo hoo, pity the poor multi-millionaires

One smart fella, he felt smart

I ain't trading the markit fer a few days ... hoarding some greenback dollivars and lookin' for a good wheat silo. The ammo and semi-automatics will have to wait 'till Tuesday.

Bullish on anarchy-related stocks.

Good Morning!

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Alphabet Soup

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Here are some stocks ideas to bolster the "Brave New World" portfolio:

Hormel (HRL) = food
Diageo (DEO) = booze
Smith & Wesson (SWHC) = guns
New Frontier (NOOF) = porn

What else would ya need?

Retest of Wednesday's high looks baked in. Then what.

Since it's the FED's (taxpayers) money why not at the share price before the collapse?

Regarding delaware law, it sounds a lot like the way russian mobsters stole public companies in the 90's. Different countries, different eras, same kind of spineless finaglers.

3 day cycle projection on dia looks 124.20

Dow left off Thursday with a 3 day cycle projection around 12450.

Most markets closed.

Not this one:



That's a new closing low for those keeping track.

spx 3 day cycle projection was 1342-1350. spy has already broken 3 day cycle projection of 132.90. 5 day cycle projection points to range of 133.80-134.50

qqqq 3 day cycle projection 43.75-.80

10 year Treasury yields up sharply.

13 week bill yield now at 0.75. Up from low of 0.20 on Thursday. That might have been the final blowoff of the panic. If so, the US government is in deep, deep trouble...

and so are we as US Americans, and such as.

chicago-

Of course I will continue producing the Fed report on a daily basis at least on days when there are Treasury auctions, auction announcements, or any other action or news release by the Fed, Treasury, and FCBs. That would cover at least Monday, Tuesday, Thursday and Friday, and Wednesday when there are Note auctions.

So I might take off two days a month.

I will continue to report the OMO, but will move them to the end of the report, since they go from being the most important part of the report to virtually irrelevant as a result of the PDCF.

I will also be calling my contact at the Fed today to ream him a new one about this. I assume he talks to Bernanke regularly, and I know for sure that he talks to Geithner.

Do you really think they want people to know what's going on? Looks like the wizard wants to put another curtain between him and the tin woodman....

Got any names?

You might ask him how they can guarantee 30 bil to JPM when JPM just increased their offer for BSC stock 5x.

double top time.

intraday indicators all very boolish.

DJ Fed Accepts $5.5 Bln In 3-Day RPs

Type of transaction: 3-Day RPs
Total accepted: $5.5 Bln
Total submitted: $48 Bln

Agency Collateral Operation
Total accepted: $4.5 Bln
Total submitted: $16.65 Bln
Stop-Out Rate: 2.25%
Weighted Average: 2.25%
High-rate submitted: 2.25%
Low-rate submitted: 2.05%

Treasury Collateral Operation
Total accepted: None
Total submitted: $21.4 Bln
Stop-Out Rate: N/A
Weighted Average: N/A
High-rate submitted: 0.75%
Low-rate submitted: 0.1%

Mortgage-Backed Collateral Operations
Total accepted: $1 Bln
Total submitted: $9.95 Bln
Stop-Out Rate: 2.35%
Weighted Average: 2.35%
High-rate submitted: 2.35%
Low-rate submitted: 2.15%

(Data was provided by the New York Federal Reserve Bank).

Have to question what this info is worth to us, now that we are blind on the PDCF operations with the PDs. We have no clue how much they took on Thursday, Friday, or how much they will take tonight. Considering they had $28.8 billion out at the end of the third day of the program, god knows where they are now. Is this $5.5 billion an adjunct, or an offset? We just don't know.

Except for money flow which has negative divergences in the longer time frames. These are usually about a day early at turning points.

spx 3 day cycle projection 1357.

dow 3 day cycle projection 12570

qqqq projection of 43.55-.75 has been hit.

They're already talking about the aftermath of the recession, as if it's over. This is gonna be one for the history books. If they still have such things afterwards.

It was fun trading the liquidity reports while it lasted. Made some decent money there. I'm fine with waiting patiently for another good opportunity. Maybe after window dressing.

Wonder when we break the record here. Only 35 users.

Finally, some respected money managers are calling this what it is THEFT.



March 24, 2008
Why is Bear Stearns Trading at $6 Instead of $2?

John P. Hussman, Ph.D.
All rights reserved and actively enforced.
Reprint Policy

Well, the ECRI (one of the more reliable private economic analysis groups) has finally thrown in the towel – “With the Weekly Leading Index having dropped more than 13 points in the last nine months, it is exhibiting a pronounced, pervasive, and persistent decline that is unambiguously recessionary.”

The possibility of a “bear market rally” aside, if the S&P 500 has already set its low, it will have been the first time that the market has responded to a similar economic downturn with less than a 20% loss on a closing basis. If we define the recent downturn as a bear market anyway, the recent low will represent the highest level of valuation that has ever prevailed at the bottom of a bear market. I expect neither of these to be true for long, but as usual, we'll respond to the evidence as it unfolds – without the need to forecast any particular scenario.

Though our investment horizon of interest is a complete market cycle, we don't generally think in terms of bull and bear markets, because they can only be determined in hindsight. We prefer observable measures that allow us to identify the prevailing state or “Market Climate” at every point in time. We don't expect various Market Climates to overlap tightly with actual bull or bear markets. Instead, we expect that, on average, the return/risk profile in “favorable” Market Climates will significantly exceed the return/risk profile in “unfavorable” Market Climates. Accordingly, if we accept a greater amount of risk during favorable conditions, and less during unfavorable conditions, we expect to perform strongly – at controlled risk – over the complete market cycle.

For now, we remain defensive, but we recognize the potential for a “bear market rally” despite conditions that, as yet, do not provide enough evidence to warrant removing a significant portion of our hedges.

Why is Bear Stearns trading at $6 instead of $2?

As I emphasized last week, the large “term financing” and “term securities lending” programs initiated by the Fed do not expose the Fed to default risk in mortgage collateral it accepts from the banks that act as primary dealers. Even if the underlying securities default, those facilities involve repurchase agreements, so the bank putting up the collateral has to repurchase the collateral at the original price plus interest after a term of 28 or 90 days. The Fed only stands to lose if the bank itself fails, and so spectacularly that the bank's liquidation value goes negative even after zeroing out bondholder claims and stockholder equity. Even in the present environment, this is unlikely.

Alarmingly, immediately after the pixels dried on last week's comment (noting “the Fed is emphatically not taking the default risk of the mortgage market onto itself” with these term facilities), details emerged that the Fed had agreed to a very different deal in its attempt to rescue Bear Stearns. This is a major and ominous departure from historical Fed policy, and from legality.

I'll cut straight to the chase.

Bear Stearns is trading at $6 instead of $2 because unelected bureaucrats went beyond their legal mandates, delivered a windfall to a single private company at public expense, entered agreements that violate the the public trust, and created a situation where even if the bureaucratic malfeasance stands, the shareholders of Bear Stearns will either reject the deal or be deprived of their right to determine the fate of the company they own. Very simply, Bear Stearns is still in play. Still, when all is said and done, my own impression is that the ultimate value of the stock will not be $2, but exactly zero.

In effect, the Federal Reserve decided last week to overstep its legal boundaries – going beyond providing liquidity to the banking system and attempting to ensure the solvency of a non-bank entity. Specifically, the Fed agreed to provide a $30 billion “non-recourse loan” to J.P. Morgan, secured only by the worst tranche of Bear Stearns' mortgage debt. But the bank – J.P. Morgan – was in no financial trouble. Instead, it was effectively offered a subsidy by the Fed at public expense. Rick Santelli of Crapvision is exactly right. If this is how the U.S. government is going to operate in a democratic, free-market society, “we might as well put a hammer and sickle on the flag.”

What is a “non-recourse loan”? Put simply, if the homeowners underlying that weak tranche of debt go into foreclosure, they will lose their homes, and the public will lose as well. But J.P. Morgan will not lose, nor will Bear Stearns' bondholders. This will be an outrageous outcome if it is allowed to stand.

In my view, the deal would be palatable if J.P. Morgan was to remain fully responsible for any losses on the “collateral” provided to the Federal Reserve, assuming shareholders were to consent to the buyout. As it stands, Congress should quickly step in to bust the existing deal and demand an alternate resolution, by clearly insisting that the Fed's action was not legal.

The Fed did not act to save a bank, but to enrich one. Congress has the power to appropriate resources for such a deal by the representative will of the people – the Fed does not, even under Depression era banking laws. The “loan” falls outside of Section 13-3 of the Federal Reserve Act, because it is not in fact a loan to either Bear Stearns or J.P. Morgan. Bear Stearns is no longer a business entity under this agreement. And if the fiction that this is a “loan” to J.P. Morgan was true, J.P. Morgan would be obligated to pay it back, period. The only point at which the value of the “collateral” would become an issue would be in the event that J.P. Morgan itself was to fail. No, this is not a loan. It is a put option granted by the Fed to J.P. Morgan on a basket of toxic securities. And it is not legal
http://www.hussman.net/wmc/wmc080324.htm

deleted, cwd was ahead of me

They were talking about the recovery in 1930 too. Stocks rose for about 6 months from the October 29 bottom.

Low traffic on the site is misleading today since Europe is closed and many Americans also have the day off. About 10-15% of our users are Your a peein.

Hussman's comments are compelling. There will be more to this story.

spx and dow break make a beeline for their projections as qqq breaks through its. All break out.

Steve LIESman, good news on the housing front, the bottom is in. Sales up and inventory down.

What did I miss? Is the FED going to stop reporting TOMO's or something?

It's not clear that qqqq projections have risen. Let's give it a few minutes to see if this is just an overshoot.

Outside projection looks like 43.88.

SPX approaching 50 Daily EMA

Cramer going crazy, the bottom is in, homies are flying.

UFB, a double in a week

The recession is over! Let's party with the FED....

[attachmentid=96940]

Covered last night's ZB chort @ 119'02 fer a pernt 'n a half.

Gap has been closed....What's next?

[attachmentid=96941]

NOT a buy point..............

. . . money for nothing and your chicks for free.

qqqq 3 day cycle projection now looks 44.45-44.50.