REMEMBER POMPEII

yo!...only fallin ashes...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+192...


...here in palookaville they think it's all over...

...stock markets have rallied 20%...

...and a bank has passed a stress test...


...deflation has failed to raise it's head in the rigged figures...

...and the value of retail sales rose a bit...


...under the carpet there are so many things...

...and soon people will begin to trip up...



DO AS I SAY NOT AS I DO


...by saving banks and automakers...

...governments have fallen into the protectionist trap...

...the game is rigged...

...always was...

...while all was going up...


...no one seemed to mind...


...now though...


...people have started to notice...



CLUSTER'S LAST STAND


...many here in palookaville...

...have their hopes pinned on the G20 clusterf*ck...


...divided they stand...

...rather than united they fall...


...well...

...we'll see...


DISMAL SCIENCE

...everyone said there would be no recession and that the financial crisis...

...would stay in the bank vaults...

...well...

...what the f*ck do they know?...


GLOBAL AND LOCAL


...world trade has collapsed...

...because the bank credits are unavailable...

...boeing has seen orders fall by 50%...

...ships lie idle in the harbour roads...



UNLIKE GERMANY


...they told us that we were failing...

...because we didn't make stuff and export it...

...unlike germany...

...we were house mad...

...unlike germany...

...we spent beyond our means...

...piled up debt...

...unlike germany...


...well...


...you know the rest...

THE DEPRESSIONIST MASTERPIECE

yo!...every picture tells a story...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+139...

NB chart is uk based and funds reflect the effect of currency movements

charts from equitable life are used as an illustration of sector performance comparisons only
and not as a commentary on their investment performance. no opinion is offered here either for or against equitable life as a pension company...

...they just happen to have these charts...
...which i find very helpful...
...when comparing sector fund performance...

...THERE IS A DISCLAIMER AT THE TOP O THE PAGE...

...THIS AINT ADVICE AN WE AINT IN BUSINESS...

...WE JUS SUCKERS LAK YOU...

...PISSIN INNA WIND...

NOW IS THE WINTER OF OUR DISCONTENT...

yo!...costa packet...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+134...


...nobody expected the spanish implosion.!.


...here in palookaville the traffic has ground to a halt...

...the wrong kind of money has brought the economy to a standstill...


...the brown boom...

...is over at last...

...now!...if only they can end the...

...brown bust.!.

Car sales plunge in worst figures since 1974

"Luxury car sales suffered most, with sales falling 65 per cent, compared to a year ago.

Fleet sales, which account for 60 per cent of the total market, fell by 35 per cent as the economic downturn forced companies to cut back on transport for staff.

It was the ninth successive month that sales have fallen compared to the previous year, the Society of Motor Manufacturers and Traders said.

The continuing slump in car sales comes after months of cutbacks within the industry with a wave of redundancies and extended factory closures...."telegraph

THE NOBEL PRIZE IS NOT WHAT IT WAS



...anatole is predicting a nobel prize for brown...

...after all not many enelected prime ministers have a patsy chancellor...

...our nobel dictator has created a spectacular bust...


...and should get some sort of recognition for it...


DEPRESSIONISM : THE ART OF THE BUST


...when peter the paintpallet started a new art movement...

...he did not realise that he would get a show so soon...

...now all the world is joining in the fun...

...currencies are out doing each other to debase themselves at his feet...

...zombie banks are casting out the demon hearsts...

...and hanging the painted one's depressionist masterpieces...

...from their atrium roofs...


DOWN IN THE JUNGLE, GOT THE BELLYACHE...


...down in the vaults the canvases are stacking up...

...toxic and unpredictable art for the new, bust millenium...

...their value rises as the other toxic assets deflate...

...paint is the future...

...for the new bust...


FORCAST NEWS


...suckers are still bettin the bust is past it's sell by...

...they think itz all over...

...normal service will be resumed and the paintings of doom...

...will be cast out of the galleries...


...but the fat lady is still waiting to sing...

...and she will not be denied...

...you can dance the danse macarbre...

...and drink the night away...

...talk yourself up till dawn...


...but...


...she will sing...

US Treasury in plans for record debt sale

"The US Treasury on Wednesday opened the floodgates of government bond issuance, revealing plans for a record debt sale in February and more frequent auctions in the months to come.

The announcement came amid growing fears about US government deficits and sent the yield on the benchmark 10-year Treasury note rising to 2.95 per cent, up from just over 2 per cent at the end of December.

The rise in Treasury yields has been pushing mortgage rates higher, complicating efforts to revive the economy. The US Federal Reserve said last week it was “prepared to” buy Treasuries if that would be a “particularly effective” way of reducing private borrowing costs.

“The Fed has to be troubled by the fact that mortgage rates have been rising and the buying of Treasuries by the Fed may come sooner than the market expects,” said William O’Donnell, UBS strategist"...FT

THE TRUTH IS OUT THERE


iain martin..."When a great many lies have been told, the antidote is usually truth. This can hurt, but without it the possibility of recovery and future happiness is remote. And so it is with today's crisis of capitalism.

If an excess of debt built with cheap money was the cause of the crisis – and it was – then more debt is not the answer. Aligning their party with this most basic but vital of insights was, as the essential Tory website Conservative Home put it, "Cameron and Osborne's bravest and loneliest decision". When the Tory leadership decided to oppose Gordon Brown's plans to borrow and spend his way out of the "Depression", as the Prime Minister called it yesterday in a revealing slip of the tongue, they were virtually alone in the western world." times

THE MAN WHO PAINTED THE CRASH

yo!...the paintman cometh...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+133...


...petey the paintstick ...

...the father of depressionism ...

...has been offered a show...


...MUMMY...

...the famous art gallery in the naked city...

...is to show his paintings of the...

...great crash...

...at the annex on threadneedle st...


THE CURSE OF THE MUMMY'S TOMB


...many in the city are worried that the works will be lost in the bad bank...

...you know! the one where all the worthless assets are held...

...the establishment see all his pictures as toxic...

...and hope that a show at the tomb...

...will draw attention away from the real sh*t stored there...


ZOMBIE ART


...the critics see the mummy as a zombie queen..

...and tell of how artists shown there always meet...

...a violent obscurity...

...still there's no business like show business...



ART FOR ARTS SAKE


...some of his most famous and controversial pieces will be on view...

...'admiral paulson crosses the rubicon'...

...'the rape of the shadow banking system'...

...'the bailout of the bust'...

...'the triumph of deflation'...

...'the bailout of the bubble'...

...'never mind the collateral, feel the bust!'...


THE CRITIC SEES


...howard huges...

...the famous art critic...

...has seen the show for what it is...


..."protectionism is to depressionism...

...what...

...koons is to pop art"...



THE END


opkin : say! that sure is good news about the exhibition dude...


petey : feels just lak palm sundae!

THE WRONG KIND OF MONEY

yo!...casey jones...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+131...


...the runaway train went over the hill...

...an she blew!..


...here in palookaville the train has left the station...

...unfortunately it's journey has been delayed...


...the engineer had prepared the passengers for all eventualities...

...tickets had been purchased well in advance...

...with money that had been created by the palookaville fed itself...

Down Week for Freight Traffic on U.S. Railroads



THE WRONG KIND OF 'FLATION


...the train is now not expected to reach it's destination...

...the wrong kind of money...

...has caused deflation...

...which in turn has bust the nation...

...but folks will still expect inflation..

...leading to a conflagration...

bloomberg : ..."Deflation was the growing concern for investors in 2008 as government bond yields fell to historic lows in December, the Reuters/Jefferies CRB Index of commodities tumbled 53 percent since July and home prices plunged 18 percent amid a deepening recession. Now, the bond market is saying Federal Reserve interest rates at zero percent, President Barack Obama’s $819 billion planned stimulus package and $8.5 trillion of U.S. initiatives to revive credit markets will reignite inflation."

“When the Fed gets finished here they will have an inflation nightmare on their hands,” said Mark MacQueen, who helps oversee $7 billion as co-founder of Sage Advisor Services Ltd. in Austin, Texas. “There is a lot of downside in conservative government bonds.”

SEESAW MARGERYDAW

market ticker : ..."If you're wondering why the stock market had its worst January on record, you need to talk to Treasury about its extraordinary issuance of debt that is crowding out money in the stock market, along with the government's scaremongering. And if you're wondering why we had a crash in September and October, go talk to Bernanke, who intentionally drained the slosh in the system as Congress was debating the EESA bill - a quite-transparent (and successful) attempt to cause a massive stock market sell-off to support what he and Paulson wanted - $700 billion in taxpayer funds for their banker buddies and suppression of Treasury yields."...


petey :

...rumour has it that...

...bonds aint what they used ta be...

...

THE LONELINESS OF THE LONG DISTANCE SAVER

y0!...long shot kikka buckit...innit!

PALOOKAVILLE FINANCIAL
capitulation day
+114...


...petethepainter is dead but still on the run...

...head shot with a sawn off, reactivated .45...

...he was under water at the end of 2008 by 7%...


...he has been tryin ta get to the bottom of the pension fund collapse...

...by swimming the pools of famous silent movie actresses in downtown palookaville...

...he hopes to find the...

...mother of all bottoms...

Distressed asset indices fall sharply

Indices tracking the value of the trillions of dollars of distressed assets that continue to blight bank balance sheets fell sharply this week as a negative spiral of financial distress and subsequent economic pain continued.

The declines – which signal further potential writedowns by banks – are fuelling fears that the first quarter of this year could herald further pain for the financial system, even as many banks reveal sharp losses for the fourth quarter of 2008.

SHORT FOR SHORT'S SAKE


Short for Shorts sake...

Money for Gods sake...

Gimme the readys...Gimme the cash...

Gimme a bullet...Gimme yo stash...

Gimme yo silver...Gimme yo gold...

Make it a million for when I get old..!

Short for Shorts sake...

Money for Gods sake!


SPECIAL LITERARY EDITION

mish : Huddling Under The TARP

Inquiring minds are reading Andrew Jeffery's column, Bank of America Huddling Under TARP.

To quote a recent op-ed in the Journal, which likened the government response to the current financial crisis to the circumstances described in Ayn Rand's Atlas Shrugged...

"Politicians invariably respond to crises -- that in most cases they themselves created -- by spawning new government programs, laws and regulations. These, in turn, generate more havoc and poverty, which inspires the politicians to create more programs . . . and the downward spiral repeats itself until the productive sectors of the economy collapse under the collective weight of taxes and other burdens imposed in the name of fairness, equality and do-goodism."

The similarities are so striking, it almost seems like regulators are using Atlas Shrugged as a playbook for their policy response to the crisis. They must not have waded through all 1,000 pages to see how the story ended.

Atlas Shrugged: Fiction To Fact

The Wall Street Journal article that Jeffrey quoted is Atlas Shrugged': From Fiction to Fact in 52 Years. Here is another snip.

The current economic strategy is right out of "Atlas Shrugged": The more incompetent you are in business, the more handouts the politicians will bestow on you. That's the justification for the $2 trillion of subsidies doled out already to keep afloat distressed insurance companies, banks, Wall Street investment houses, and auto companies -- while standing next in line for their share of the booty are real-estate developers, the steel industry, chemical companies, airlines, ethanol producers, construction firms and even catfish farmers.

With each successive bailout to "calm the markets," another trillion of national wealth is subsequently lost. Yet, as "Atlas" grimly foretold, we now treat the incompetent who wreck their companies as victims, while those resourceful business owners who manage to make a profit are portrayed as recipients of illegitimate "windfalls."

...Mike "Mish" Shedlock...


GROUCHO, HARPO, CHICO,

...KARL...

..."Owners of capital will stimulate the working class to buy more and more expensive goods, houses and technology, pushing them to take on more and more expensive debt, until their debt becomes unbearable.

The unpaid debt will lead to the bankruptcy of all banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism.”

...So says the Karl Marx quote that has been whizzing round Wall Street and the City...

times :

"We seemed a step closer to that prospect yesterday.
Bank shares plunged again on both sides of the Atlantic amid concern that more capital injections will be required. Bank of America shares fell 20 per cent on reports that it needed further government help to complete the acquisition of Merrill Lynch. Merrill has suffered higher than expected losses in the fourth quarter and BoA is in talks with the American authorities about an infusion of capital.

Citigroup shares tumbled further, ahead of today's results, which are expected to be horrible.

These falls took the combined value of Citigroup and BoA - so recently the two most valuable banks in the world - below that of Wells Fargo, the conservative West Coast lender.

Back in Britain, bank shares were also under the cosh again, as ministers scurried to finalise another package of measures designed to get credit flowing again.

Gordon Brown said that the toxic assets of banks had to be dealt with, which could require more capital, while Capital Economics forecasts British banks will lose £85billion over the next three years and lending will be slashed by £400billion unless they get more capital.

At this rate, RBS will be fully nationalised before Sir Philip Hampton takes over as chairman.

According to the Marx quote, this means communism will not be far behind.

Except, of course, Marx didn't say that.

The quote is a fake. You just can't trust those bankers. times

1984 : THE WAY WE LIVE NOW

The Ministry of Truth...

wikipedia : ..."is where the main character of the book Nineteen Eighty-Four, Winston Smith, works.^[1] It is an enormous pyramidal structure of glittering white concrete rising 300 meters into the air, containing over 3000 rooms above ground.

On the outside wall are the three slogans of the Party:

"War is Peace,"

"Freedom is Slavery,"

"Ignorance is Strength."

There is also a large part underground, probably containing huge incinerators where documents are destroyed after they are put down...

memory holes.

For his description Orwell was inspired by...

the Senate House at the University of London.<sup>[2]..."




ANYONE FOR KAFKA ?</sup>

Adj.	1.	Kafkaesque - relating to or in the manner of Franz Kafka or his writings
	2.	kafkaesque - characterized by surreal distortion and a sense of impending danger; "the kafkaesque terror of the endless interrogations" unrealistic - not realistic; "unrealistic expectations"; "prices at unrealistic high levels"

<sup>http://www.thefreedictionary.com/Kafkaesque



THE PEN IS MIGHTIER THAN THE PENCIL


...so!...

...ayn rand, karl marx, george orwell, kafka...

...things are startin ta look serious...</sup>

BLOG ONNA HOT TIN ROOF

yo!...cop fo this...


PALOOKAVILLE FINANCIAL stardate : capitulation day+103


liam : ..."The UK - like most Western economies - is in a grave situation. Our money markets are frozen, denying vital liquidity to millions of credit-worthy firms. Unless the inter-bank market reboots, then even hastily revised 2009 Western growth forecasts - down from 2-3pc a year ago to a 1-2pc contraction now - could turn out to be too optimistic. We face the very real danger of chronic unemployment across the so-called "advanced economies" and widespread social unrest.

Yet the Keynesian bail-out solution, accepted as "essential" by practically every mainstream commentator, will do nothing to unfreeze our credit markets. It's even more dangerous than the disease it's supposed to cure.

Panicked politicians have now closed their ears to reason and are ripping up the rules. And as the bail-out continues, and the investment banks channel public funds to senior executives, the vested interests that caused this crisis are adding insult to injury.

With failure and incompetence thus rewarded, huge damage is being done to the very fabric of Western market-driven commerce. That could spark a damaging populist backlash, recreating the economic dark ages of heavy regulation and state diktat, crushing the entrepreneurial spirit that has long driven human progress." Sunday Telegraph

irwin : ..."The federal government is determined to shore up almost any firm that claims to be too big or “too interconnected to fail”, and to rebuild the nation’s infrastructure, broadly defined. Skittish consumers are borrowing and spending less, but government spending will more than make up for this. The wall of money stashed in low-paying Treasury IOUs will sooner or later wash back into shares and corporate bonds. The $500 billion that Bernanke will use to buy up mortgage-backed securities cannot but help to loosen that part of the credit market, just as the bailout of General Motors’ credit arm, GMAC, will make it easier for less credit-worthy consumers to buy cars with no down-payment and no interest charges. Moves such as that might be recreating the excess credit culture that brought us to this pass, but better that than a prolonged recession — so believe politicians for whom the 2010 elections are just around the corner, and Bernanke, whose claim to academic fame is his study of the causes of the Great Depression.

It will be surprising indeed if all of these moves don’t put the economy on the path to recovery by the end of the year. And on the path to a round of inflation that Larry Summers, tipped to occupy the Fed chairman’s seat, and other Obama advisers feel they can pinch off by quickly draining excess liquidity from the economy by raising interest rates and — you guessed it — taxes. Holders of dollars hope these economist-paragons are not prisoners of their adoring press; otherwise, the dollar will race the pound to the bottom of the currency heap." Sunday Times

from the big picture : ..."Readers often ask me about Richard Russell’s (Dow Theory Letters) viewpoint on the stock market. Here is his latest take on matters: “It occurs to me that this is a good time to remember my old friend Marty Zweig’s classic warnings: ‘Don’t fight the tape, don’t fight the Fed’. Well, if you are bearish on 2009, you are indeed fighting the Fed and probably the tape. Why do I say that? Because the Bernanke Fed is going all out in its effort to turn the US economy around. Bernanke says the Fed will do whatever it takes to halt the current trend to deflation and to bring back prosperity and mild inflation to the US.

mish : ..."Bernanke Correctly Judged Nothing

Bernanke considers himself an expert on the great depression and on the Japanese deflation as well. Trying to act quickly, Bernanke has come out blazing with 8 new policy tools, including the TALF, TARP, PDCF, ABCPMMMF, CPFF, TAF, and MMIFF to go on top of Open Market Operations, Discount Rate setting, and setting reserve requirements.

The result so far is deflation. The result in Japan was deflation.

There is only one way to defeat deflation and that is to not let the conditions that foster it to build up in the first place. What caused this deflationary bust is the credit boom that preceded it. What caused the great depression was the credit boom that preceded it. Hoover's policies and FDR's policies made the great depression worse.

Bernanke's policies are going to make this depression worse. Yes, I used the word depression. It may not be as big as the great depression, but the word "recession" does not do justice to what we are in and what is coming down the pike." mish


painty : jus a few thoughts from out there...

...oh...yeah! an this from marc faber...nod ta big picture...

RAG TAG AN BOBTAIL

yo!...merry Christmas...innit!

PALOOKAVILLE FINANCIAL stardate : capitulation day+97


UP THE GARDEN PATH act 3


...the audience at THE BRITISH ECONOMY have been led up the garden path...


...Admiral Brown and Gordon Darling...have had to learn some new lines...


...the audience are getting restless and are...starting to fidget...



brown : darling...this end of the garden has no roses...

darlin : aye aye cappin...no roses it is...


brown : no more boom an bust!

darlin : aye aye sir...no more boom it is...


brown : so!...how much ammo we got left...darlin?

darlin : look!...there's bill an ben...the flower pot men...


bill : loddelop...loddelop...

ben : innit!

brown : who's the tall broad wiyi blond hair?

darlin : thats the weed...

weed : : weeeeeeeeeeeEEEEEEEDDDD!!


...the woodentops are out inna garden lookin fo some turnip greens...


daddy woodentop : dig fo victory!...

mummy woodentop : yo shudda voted...tory...baby...


MEANWHILE BACK ATTA ROLLERCOASTER


dopey : hold on tite dudes...this sucker goin dahn!...

aladdin : f**kin wishes don run aht...

Ozzeh : yo don need no courage...jussa medal will do...

dopey : ah cars issa best inna wurld...

beulah : yo cars is the biggest inna wurld...innit!


...the rollercoaser ride speeds up in 2009...anna folks all gettin sick...


doc : build it...build it...jussa likkle bit...take it easy...sho yo lakkin it...

sleepy : whahoppen musky?...one minute all woz cosy an swell...

sneezy : sh*t hitta fan...innit?


VIRGIN ONNA RIDICULOUS


...the crew fomma loft are on their way ta the local piggly wiggly...

...fo turnip greens...


spidah : where alla shops gone man...??

zooneh : shops is toast dude...

laverne : say wot?...ah don care wot they say...i won't stay...inna wuld wiyaht shops...


...heh..heh..heh...looks lak yo gonna hafta get yo kicks fromma web...


NEXT TIME ON UP THE GARDEN PATH


...andy pandy gets a day job...somebody buys a house...

...oh yeah...anna sucker guz dahn...


y'all come back soon...heah?

SANITY IN REVERSE

yo!...where that sanity b*stard?...innit!

PALOOKAVILLE FINANCIAL stardate : capitulation day+91


...in palookaville we take Christmas seriously...


beulah : wot sort o xmas is it when a sanity rally aint been allowed ta git goin?...

laverne : evva yeah a shocks an scares giz it a big finish...

...ta mek alla suckers appy...

...nah it done gone sad an dismal...

beulah : big fat red an white git gone run off wiya goodwill...


zooneh : chill aht sista!...yo jumpin a gun innit?..


paintremover : jus look atta chart gels...yo stash is rallyin...so far!


NB chart is uk based and funds reflect the effect of currency movements


'FLATION GONNA FLIP


ambrose : ..."Clearly the US is already in the grip of debt-deflation. "The obvious conclusion is that the Fed should print money to purchase private sector assets so as to drive up their price," he said.

Fed chief Ben Bernanke does not need prompting. He made his name as a Princeton professor studying the "credit channel" causes of depressions. Now fate has put him in charge of the channel.

Under his guidance, the Fed has this week pledged to "employ all available tools" to stave off deflation - and damn the torpedoes. It will purchase "large quantities of agency debt and mortgage-backed securities." It will evaluate "the potential benefits of purchasing longer-term Treasury securities," i.e, printing money to pay the Pentagon.

Put bluntly, the Fed is deliberately stoking inflation. At some point it will succeed. Then the risk flips quickly to spiralling inflation as the elastic snaps back. There will be a second point of danger.

By late 2009, if not before, the bond vigilantes may start to fret about the liquidity lake. They will worry that the Fed may have to start feeding its holdings of debt back onto the market. The Fed's balance sheet has already risen from $800bn in September to $2.2 trillion this month. It will be $3 trillion by early next year.

"The bond markets could go into free fall," said Marc Ostwald from Monument Securities.

"The Fed went into this all guns blazing just as the Neo-cons went into Iraq thinking it was a great idea to get rid of Saddam, without planning an exit strategy. As soon as we get the first uptick in inflation, the markets are going to turn and say this is what we feared would happen all along. Then what?" he said.

New Star's Simon Ward said all three measures of the US broad money supply are flashing recovery. M2 has risen at annual rate of 17pc over three months.

"It has all changed since the Fed began buying commercial paper in October. If the money supply is booming at 20pc in six months, inflation will become a concern. Given that public debt ratios are already on an explosive path, we risk a debt trap," he said....telegraph

vince : is he right musky?

charts from equitable life are used as an illustration of sector performance comparisons only
and not as a commentary on their investment performance. no opinion is offered here either for or against equitable life as a pension company...

...they just happen to have these charts...
...which i find very helpful...
...when comparing sector fund performance...

...THEY IS A DISCLAIMER AT THE TOP O THE PAGE...

...THIS AINT ADVICE AN WE AINT IN BUSINESS...

...WE JUS SUCKERS LAK YOU...

...PISSIN INNA WIND...

THESE BANKS ARE MADE FOR LENDING

yo!

PALOOKAVILLE FINANCIAL stardate : capitulation day+83

Chancellor Alistair Darling prepares to tell banks to start lending

Alistair Darling and Lord Mandelson are preparing for tense negotiations with Britain's banks over their failure to resume lending and offer competitive mortgage deals to homeowners.

We keep saying...we've got no more money for you.
sometimes we call in debt, but confess.
We've been messin' where we shouldn't have been a messin'
and now something else is shrinkin' all our dosh.

These banks are made for lending, and that's just what they'll do
one of these days these banks are gonna walk all over you.

We keep lying, when we oughta be truthin'
and we keep losin' when we oughta not bet.
We keep samin' when we oughta be changin'.
Now what's right is right, but we ain't been right yet.

These banks are made for lending, and that's just what they'll do
one of these days these banks are gonna walk all over you.

We keep playin' where we shouldn't be playin
and we keep thinkin' that we'll never get burnt.
Ha! We just found us a brand new bunch of suckers...yeah
and what we know they ain't HAD time to learn.

These banks are made for lending, and that's just what they'll do
one of these days these banks are gonna walk all over you.

Are you ready banks?...Start lendin'!

DON LOOK DAHN

yo!...strange days!...innit...!

PALOOKAVILLE FINANCIAL stardate capitulation day+19

...while dorktrekkin inna long episode o
DORKTREK : LOST IN SPACE...the crew from the loft in
down town palookaville had fallen thru a back o a cornflakes box
inna breakfas nook an become trapped inna 'flation nebula...

...a de-leveraging black hole has been suckin alla life outa
the galaxy an 'vestments bin shrinkin...

...identified as a NIAGARA drainhole...the sucker goin dahn is a bank near you!

...alla kings horses an alla kings men...beamed in...a mothership o dosh ta plug a sucker up...

...trouble is...fat lady inna wings..innit!
...an noboddy don know wether she don sung yet or no...


...CUBES an SPHERES...bin seen inna vicinity...an y'all know wot at means...


RESISTANCE IS FUTILE...

pjc :Profit illusion

..."Profits for the surviving companies will be squeezed by the recession and the taxes and public spending cuts needed to pay for the bank bailouts. As profits fall the idea that stocks are cheap on a price-to-earnings multiple will be seen for the illusion that it represents, and stocks will fall further...

...But how low will stocks go and how long will they stay there. It could be a steeper fall than I thought at the end of September and the recovery take much longer. This is not a normal cyclical recession in which stocks will bounce back. It is a once in a generation global financial crisis and will take very much longer to put right...." PJ Cooper

nick : Back in June 2008 I wrote a piece for VOXEU predicting a mild recession in 2009. Over the last few weeks the situation has become far worse, and I believe even these pessimistic predictions were too optimistic. I now believe Europe and the US will sink into a severe recession next year, with GDP contracting by 3% in 2009 and unemployment rising by about 3 million in both Europe and the US. This would be the worst recession since 1974/75. In fact the current situations has so many parallels with the Great Depression of 1929-1932, when GDP fell by about 50% in the US and by about 25% in Europe, that even my updated predictions could again be over optimistic....

nick : ..."But after these earlier shocks volatility spiked and then quickly fell back. For example, after 9/11 implied volatility dropped back to baseline levels within 2 months. In comparison the current levels of implied volatility have been building since August 2007 and are likely to remain stubbornly high.

But even these more moderate surges in uncertainty after these earlier shocks had very destructive effects. The average impact of the sixteen shocks I examined in prior research was to cut GDP by up to 2% in the following six-months. The current shock is both larger than these on average and also appears to be more persistent. If these earlier temporary spikes in uncertainty led to a 2% drop in GDP the impact of the current persistent spike in uncertainty is likely to be far worse...." voxeu

peteypainty : how was it fo yo zoon?

zooneh : yo mean...how is it fo us?..boss..

chart from alphatrends hat tip - financial armageddon

AS FALLS NIAGARA

yo! innit!... a week a long time inna BAILOUT...

PALOOKAVILLE FINANCIAL stardate capitulation day+7

Admiral Paulson anna salty dogs onna dorkship TITANIC...out of Wall St.
are fighting for the inflatable life rafts that have been stowed away under CONGRESS
for the inevitable FINANCIAL EMERGENCY...

the national debt is so huge now anyway that, the hope is, no one will notice another
7 BILLION...

...there is enough hot air in congress, they believe, to inflate well beyond these paltry figures...

onna good ship BLOGOSPHERE the maroon has gone up anna bloggin stiffs is tryin ta get the workin stiffs ta get onna 'phon ta their congressperson...an ammer em flat abaht a ears....... an get em ta stop paulie from sinkin a dollah.

a week after the MOTHER plan was launched a liquidity is solidified agin anna
banks wotz BUST is sh*ttin bricks waitin fo a 'flatables ta come rescue em...

ya BANKERS wot dunnit are clean away wiya BONUS so large an heavy atta workin stiffs is gettin restless an gon get a congress ta GET THE MONEY BACK OFFA EM...

meanwhile with the alien hedge funds glued together by the Lepage glue gun anna day traders slapped silly by a VENGERS a shock an scares is goin dahn wiya villa...

VIAGRA FOR NIAGARA

ya BOOM is BUST an a BAILOUT is all ya got ta save a TITANIC but even Cathy Berberian knows...

inna current onna niagara river a TITANIC is bein swep along atta evva faster rate...
a enjin gone DROOP an a moneh be needed fo VIAGRA ta STIFFEN resolve an RESTORE CONFIDENCE...says CAPTAIN BRUSH...skipper o a titanic wen she took a wrong course...

a THREE OFFICERS are countin anna pressure buildin up inna congress steam room, fromma meltdown, ta motivate a suckers ta cough up!

Jonathan Weil : Why Mark-to-Paulson Accounting Won't Save Banks

..."The plan goes like this: Treasury will pay financial institutions above-market prices for garbage assets nobody else wants. Then, through the magic of mark-to-Paulson accounting, everybody else that owns similar stuff will use those same prices, or marks, to value the trash on their own balance sheets.

Shazam! Banks and insurance companies write up the asset values on their books. They post big profits. Their capital goes up. Everyone gets fooled. And nobody knows the difference.

Except, we do. And that's why the plan probably won't work.

Still, give Paulson and Federal Reserve Chairman Ben Bernanke credit for ingenuity. At the same time banks are begging regulators to suspend mark-to-market accounting rules so they can avoid disclosing more losses, Paulson and Bernanke instead devise a way to abuse the same rules for the same banks' benefit.

Put It in Reverse

Under Paulson's plan, Treasury would hold so-called reverse auctions for financial institutions' troubled assets. Whoever submits the lowest bid gets to sell its junky assets to Treasury for cash.

While that might look like a competitive, free-market mechanism, it's not. Once the first bid in the first auction is submitted, it may not go much lower, and it probably will be much higher than the true market value.

That's because the real incentive for the banks isn't to sell their rubbish to Treasury and get cash. It's to watch the Treasury pay grossly inflated prices to others. That way, they can use those transactions for accounting purposes to mark their books to the Treasury's farcical market prices.

This presents another problem. The transaction prices coming out of these auctions may not meet the accepted definition of fair value. Under the Financial Accounting Standards Board's definition, fair value is the price ``in an orderly transaction between market participants.''.." Bloomberg..........

Kevin Hamlin : Asia Needs Deal to Prevent Panic Selling of U.S. Debt, Yu Says

Sept. 25 (Bloomberg) -- Japan, China and other holders of U.S. government debt must quickly reach an agreement to prevent panic sales leading to a global financial collapse, said Yu Yongding, a former adviser to the Chinese central bank.

``We are in the same boat, we must cooperate,'' Yu said in an interview in Beijing on Sept. 23. ``If there's no selling in a panicked way, then China willingly can continue to provide our financial support by continuing to hold U.S. assets.'' (my emphasis) - hat tip naked capitalism

bluepetey : AS FALLS NIAGARA...SO FALLS NIAGARA FALLS

capitulation posponed, gravity defied, fat lady....waitin...

am only waitin til a mornin comes...til a mornin commmmes...