Welcome to another week of trading, humor, insights, served with some political barbs and what-not at B4 the Bell! B4 has as its central theme short-term trading, lead by the astute technician Brain4. But it is also about any technical and economic issues that members think affects that - in a cordial atmosphere of a 24/7 international family lounge.
The pillars of the credit bubble are starting to shake. This time Fannie Mae's problems won't be cured by more political donations and lobbyists:
Fannie Mae Takes New Approach in Crisis
By Jeffrey H. Birnbaum and David A. Vise Washington Post Staff Writers Monday, September 27, 2004; Page A01
Fannie Mae, one of Washington's largest and most influential companies, is facing a serious crisis. Federal regulators have accused the mortgage-finance giant of cooking its books, in part to make room for huge bonuses for its top executives.
When confronted with emergencies in the past -- legislative efforts to tax the company or to end federal ties that give it a competitive advantage -- Fannie Mae has used a brass-knuckles approach. Its political machine, comprised of hired lobbyists, executives and directors of both political parties and grassroots groups nurtured by donations from its foundation, has long been able to run over its adversaries.
"I don't think they have ever faced a crisis like this. Political muscle is not going to fix this problem," said Washington attorney Bill Lightfoot, who tangled with Fannie Mae over tax issues while a member of the D.C. Council.
The RAF military planes that escorted the Greek Olympic Airlines Airbus until it made an emergency landing at Stansted Airport in Essex, east of London, had orders to shoot it down in the case of a bomb attack or hijack, according to British newspapers “The Guardian” and “Daily Telegraph”. The passenger plane was ready to depart from Stansted Airport a little after 10 am this morning to continue its trip to New York.
The plane with 301 people on board had departed yesterday from Athens and was led to Stansted Airport yesterday afternoon when an anonymous caller warned Athens newspaper “To Ethnos” that there was a bomb on OA Flight 411 to New York.
The passengers spent the night at a hotel near the airport and the British authorities after searching the plane and its baggage confirmed that nothing suspicious had been found.
Ameritrade has had all weekend to "fix the problem" that led to their web site shut down on friday afternoon just as the market was about to free fall. It will be very interesting to see if they allow it to continue operating in the event of a sell off this morning.
Voice Of America Suddenly top of Google News Results:
I've clicked on two news stories on Google News home page this morning and each was surprisingly a story on Voice of America...our very own propoganda service. I have never seen this before, so I can only assume that Google is acting in concert with the Ministy of Information to deliver the filtered blather to the sheeple as follows....
NOTHING TO SEE HERE...MOVE ALONG:
Europe Search of Diverted Greek Jet Finds Nothing Amiss VOA News 27 Sep 2004, 10:18 UTC Email this article to a friend. Printer Friendly Version
British authorities gave the all-clear Monday for more than 300 people aboard a Greek passenger jet to continue their flight to New York, after bomb threats that forces the plane to make an emergency landing in London.
Security personnel spent hours searching the aircraft and all the passengers' luggage, and police said they are satisfied there was no threat to the flight's safety.
FANNIE forced to hold "cash on had" would take way too much liquidity out of the system...something's going to blow!
Fannie Mae said near capital deal Source: Mortgage financer may be forced to keep up to $31B on hand while it fixes accounting woes. September 27, 2004: 6:52 AM EDT
WASHINGTON (Reuters) - Embattled mortgage finance giant Fannie Mae was close to a deal with regulators late Sunday that would force the company to keep billions of dollars more in cash on hand while it corrects accounting problems, a source familiar with the negotiations said.
Fannie Mae's regulator, the Office of Federal Housing Enterprise Oversight, last week released a report that accused the company of pervasive problems with accounting and internal controls and ordered the company's board to take immediate remedial action.
Fannie Mae (FNM: Research, Estimates) would have to maintain 30 percent more than current rules demand it has to hold on its balance sheet -- 2.5 percent of assets plus 0.45 percent of off-balance-sheet obligations, or some $31 billion at the most recent assessment, said the source.
Leading economic gauge takes a dip Lack of growth in the index shows no end in sight to the current slowdown, panel says. September 24, 2004: 12:10 PM EDT
NEW YORK (Reuters) - A leading index of the U.S. economy dipped in the latest week, and a continued lack of growth in the data shows no end in sight to the current slowdown, a report showed on Friday.
The weekly leading index of independent forecasting group The Economic Cycle Research Institute index slipped to 131.4 in the week to Sept. 17 from a downwardly revised 131.6 the prior week, ECRI said in a press release.
"The index and its growth rate have been essentially flat for a couple of months, after falling sharply starting in the spring," said Anirvan Banerji, ECRI's director of research.
"That suggests that the economic slowdown we are now seeing is real and there is no end in sight," Banerji told Reuters.
From McHugh this week - the signs are there:
The Conference Board reported that its U.S. Index of Leading Economic Indicators fell 0.3 percent, the third straight monthly decline. We learned from the Commerce Department on Friday that Durable Goods Orders fell 0.5 percent in August. Transportation was the main drag. Including aircraft orders, and excluding defense, orders fell a whopping 7.4 percent, the largest decline in two years.
Jobless Claims rose significantly this past week, reported at 350,000 according to the Labor Department.
The ABC News/Money magazine Consumer Comfort Index fell to negative (-9) last week.
M-3 fell again last week, down another $4.9 billion on a seasonally adjusted basis. Over the past eleven weeks, M-3 is down 34.8 billion. Our research has found that whenever M-3 either plateaus or declines for more than two months, stocks fall one to three months thereafter.
He is highly critical of the Commission which investigated the subject we can't discuss here and elaborates on other instances of attacks we never heard of. Plus he discussed the evidence for the Oklahoma City Bombing which suggests there is more to that story also.
Light Sweet Crude at $49.30!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Hey MH...I think it's a full moon today!
Move over, Haywire Theory!
A shocking story out of the UK:
LONDON (Dow Jones)--U.S. President George Bush is being urged to signal a dollar devaluation of up to 20% to rebalance the global economy ahead of Friday's Group of Seven and International Monetary Fund meetings in Washington, the U.K.'s The Business newspaper reported.
Senior U.S. administration officials in Washington have over the past few days tried to influence the White House and U.S. Treasury to put pressure on the G7 to agree to a dollar depreciation in its final statement, the newspaper said.
Many of us have been wondering -- if the Soft Patch doesn't pASS(_)_) as predicted, where's the escape hatch?
Brittle Federal Reserve egos do not allow slashing the Fed Funds rate a month after they raised it. It would make them look like idiots, whereas in reality they are ... PhDs.
So the relief valve could be the dollah. Devaluing more or less equates to monetary easing.
One should recall, though, that the dollah was devaluing rather severely during 1987 ... and James Baker's threat (directed at the Germans) to "let the dollar slide" was uttered over the weekend of 17-18 October 1987.
"GOLD -- it's not just for misers anymore."
"Dollahs -- fire-starters for the K-wave winter." - Drano
"Three humps and a dump." - anotherone, 21 SEP 2004
"No gold was harmed in the making of this movie." - Bizarro Greenspan
[i]"Da Track. Da place where Morons bet on Animals Controlled by Criminals." - our jickiss