dcb

Weekly Street Sentiment: Sell Side Is Lining Up on Both Sides of the Market

eev looked like a good by today. maybe it wasn't perfect, but I am happy to wait a few more weeks. 5% upside potential with 30% down I'd say. (to the market that is)

Wall Street Breakfast: Must-Know News

Note, the trustees of AIG are picked by NY fed whcih has the ability to fire and over rule them. expect aig to behavie in way best for bankers not taxpayers. the AIG sham continues.

AIG Names Six for Board as Trustees Assert Control (Update2)
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By Hugh Son

May 19 (Bloomberg) -- American International Group Inc., the insurer bailed out by the U.S., named six new director candidates in the first nominations since the trustees managing the government stake vowed to overhaul the board.

The candidates are Harvey Golub, Laurette Koellner, Christopher Lynch, Arthur Martinez, Steve Miller and Douglas Steenland, New York-based AIG said today in a statement.

The trustees, named in January, are under pressure to turn around the money-losing insurer after the bailout was expanded to as much as $182.5 billion. The trustees told Congress last week that they’d selected five executives to join the board and that AIG will nominate one new member.

“The board needs to move very quickly to re-establish the credibility of AIG’s management team,” said Phillip Phan, professor of management at the Johns Hopkins Carey Business School in Baltimore, in an interview before the announcement.

The insurer’s current board worked with the trustees in picking the candidates, Chief Executive Officer and Chairman Edward Liddy said today in the statement. AIG’s annual meeting will be held on June 30, the insurer said today. It was previously scheduled for May 13.

The names of all the candidates excluding Koellner, 54, a former president at Boeing Co., were reported last week.

Miller, 67, is chairman of Delphi Corp. and a former chief financial officer of Chrysler Corp. Steenland, 57, is the ex- Northwest Airlines CEO. Lynch, 51, is a retired partner at consulting firm KPMG International.

Golub, Martinez

Golub, 70, was CEO of American Express Co. from 1993 to 2001. Martinez, 69, was CEO of Sears Roebuck & Co. from 1995 until 2000.

“The new candidates have extensive experience with large complex organizations and in the areas of financial services, accounting and restructuring,” Liddy said in the statement.

The trustees, appointed by the Federal Reserve Bank of New York, are Jill Considine, former chairman of the Depository Trust & Clearing Corp.; Chester Feldberg, former chairman of Barclays Americas, and Douglas Foshee, chief executive officer of natural gas producer El Paso Corp.

The director candidates will be listed in an AIG proxy to be issued this month, Foshee told lawmakers last week in prepared testimony. The board will have nine new directors including Liddy, Suzanne Nora Johnson and Dennis Dammerman, each appointed in the past year, he said.

Fresh Start

“If AIG is to succeed, it needs a fresh start -- a reset, if you will,” Foshee said at the May 13 hearing.

The trustees wield the government’s 77.9 percent stake in AIG and control votes on board members, asset sales, mergers and selection of top executives, according to a regulatory filing.

The overseers will vote in a way that “maximizes shareholder value” said Peter Bakstansky, a spokesman for the panel, in an April 6 interview.

AIG directors Virginia Rometty, Michael Sutton and Edmund Tse have said they are stepping down from the board. Stephen Bollenbach, appointed last year as lead independent director, won’t stand for re-election at the annual meeting, said a person familiar with the situation. The person asked not to be identified because AIG hadn’t announced Bollenbach’s plans.

A voice mail left for Bollenbach wasn’t immediately returned.

AIG was first rescued in September with an $85 billion credit line after a liquidity squeeze caused by credit-default swaps the insurer sold to banks. The company agreed in September to hand over a controlling stake to the U.S. and to replace Robert Willumstad as chairman and CEO. Liddy was picked by then- Treasury Secretary Henry Paulson.

The insurer’s bailout expanded to $122.8 billion, $152.5 billion and then $182.5 billion as the government sought to prevent losses at banks that did business with AIG. The company said it owes about $46 billion of a $60 billion Federal Reserve credit line as of last week.

To contact the reporter on this story: Hugh Son in New York at [e-mail]

Credit Card Receivables: Even Moody's Thinks the Fed's 'Adverse Case' Is a Joke

The fact that I can tell you when the programs are activated and how the market will move isn't an issue of thumbs up or down. it is a fact, and if you want to be an active trader I'd watch it because it will help your return either way you play the game. I had to work today, but easy to tell to bet long in the afternoon you can see the change at 13:16 buy a long or sell your short. It isn't rocket science and the manipulation is there for anyone who wants to see it. period.

On May 12 08:22 PM dcb wrote:

> here is another joke.
> can you tell when goldman turned on the program today.
> Tue 4:35pm ET- Briefing.com
> Profit takers sold early gains and sent the major indices markedly
> lower for most of the session, but stocks were able to battle back
> in the second half
>
> just look for high money flows when there aint buying spikes. it's
> easy!! but do not tell me this is manipulation (joke)
>
> if you want to trade short, I would spend a lot of time watching
> this. it really tell you when things are going to turn. it has worked
> for me multiple times now. I look at S&P

Credit Card Receivables: Even Moody's Thinks the Fed's 'Adverse Case' Is a Joke

here is another joke.
can you tell when goldman turned on the program today.
Tue 4:35pm ET- Briefing.com
Profit takers sold early gains and sent the major indices markedly lower for most of the session, but stocks were able to battle back in the second half

just look for high money flows when there aint buying spikes. it's easy!! but do not tell me this is manipulation (joke)

if you want to trade short, I would spend a lot of time watching this. it really tell you when things are going to turn. it has worked for me multiple times now. I look at S&P

Credit Card Receivables: Even Moody's Thinks the Fed's 'Adverse Case' Is a Joke

THIS DID NOT BELONG IN THIS ARTICLE, BUT I THOUGHT READERS OF TYLER WOULD APPRECIATE IT.

AIG Trustees Should Answer to Taxpayers, Not Fed, Towns Says
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By Mark Pittman, James Sterngold and Hugh Son

May 12 (Bloomberg) -- A House panel plans to ask trustees assigned to safeguard the U.S. government’s $182.5 billion investment in American International Group Inc. whether their supervision by the Federal Reserve Bank of New York serves taxpayers’ interests.

The trustees -- Jill Considine, Chester Feldberg and Douglas Foshee -- were appointed in January by the New York Fed, a private institution owned by member banks, which has the power to overturn some of their decisions and to remove them. Edolphus Towns, a New York Democrat who chairs the House Committee on Oversight and Reform that will hold hearings tomorrow, said he’s concerned that the interests of AIG’s customers and trading partners may outweigh those of taxpayers.

“As a $182.5 billion recipient of taxpayer dollars, AIG should no longer be able to operate in the dark,” said Towns in an e-mail. “The American people, who now own a major portion of this company, deserve clarification on core issues of the AIG bailout -- who exactly is in charge at AIG and who is protecting the taxpayer’s multibillion-dollar investment?”

AIG is the biggest recipient of government rescue funds. Whether it can repay the money may depend on actions by the trustees, some of which must be approved by the New York Fed. The New York-based insurer has received four bailouts valued at $182.5 billion since agreeing in September to turn over about an 80 percent stake in the company to the government.

AIG Counterparties

Peter Bakstansky, a spokesman for the trustees and a former spokesman for the New York Fed, said the three are “prepared to talk about” what they have been doing since their appointment when they testify. He said the trustees speak weekly with AIG management by telephone and meet monthly in person. He declined to give further details.

Deborah Kilroe, a spokeswoman for the New York Fed, declined to comment.

The insurer’s counterparties include firms connected to the New York Fed, such as Goldman Sachs Group Inc., which has received more than $8 billion of AIG’s bailout funds to settle credit-default swaps it had with the firm. Towns’s committee plans to ask the trustees and AIG Chief Executive Officer Edward Liddy, who is also scheduled to testify, why the company didn’t try to negotiate for payments of less than the full amount.

New York Fed President William Dudley worked until 2007 as Goldman Sachs’s chief economist. Stephen Friedman, who resigned as New York Fed chairman May 7, was once CEO of Goldman Sachs and supervised the search for Dudley.

Friedman resigned from his New York Fed post after the Wall Street Journal reported that he bought 37,300 shares of Goldman Sachs last year while seeking a waiver of Fed policy that would have precluded him from sitting on the Goldman Sachs board and being New York Fed chairman at the same time. The shares have since gained $3 million in value.

‘Widening Morass’

“These programs are drawing the Federal Reserve into a widening political morass and compromising Fed independence,” said William Poole, former president of the St. Louis Fed. The Fed lending programs “ought to have legislative authorization and ought to be run out of the Treasury or some other agency of the federal government.”

Goldman Sachs CEO Lloyd Blankfein rejected calls to remove Friedman. “He is a credit to our board,” Blankfein said last week at the firm’s annual meeting in New York. Friedman said he bought the shares “because I thought Goldman Sachs stock, under tangible net worth, was at a very attractive price.”

The New York Fed is one of 12 regional Federal Reserve banks and the one charged with monitoring capital markets. It is also managing $1.7 trillion of emergency lending programs. While the Fed’s Washington-based Board of Governors is a federal agency subject to the Freedom of Information Act and other government rules, the New York Fed and other regional banks maintain they are separate institutions, owned by their member banks, and not subject to federal restrictions.

‘Right to Disclosure’

JPMorgan Chase & Co. CEO Jamie Dimon and Richard Carrion, chairman and CEO of Banco Popular de Puerto Rico, are also on the New York Fed board, along with General Electric Co. CEO Jeffrey Immelt.

“Fed resources are public resources, and taxpayers have a right to disclosure,” Poole said.

The congressional hearing will be the first public appearance for the trustees, who are under pressure from lawmakers to show they are helping to turn around the insurer. Towns said he will ask Liddy and the trustees “what they are planning to do with the company and how this plan, whether it is to liquidate or rehabilitate the company, will ensure that American taxpayers are repaid.”

Representative Darrell Issa of California, the ranking Republican on the oversight committee, said he wanted greater accountability from the trustees.

$100,000 a Year

“There is a significant and troubling lack of transparency and accountability in Treasury’s delegation of authority to an ‘independent’ trust that manages the government’s and taxpayers’ interest in AIG,” Issa said in an e-mailed statement. “The American people have a right to know how these trusts are going to be designed, how they will operate and how the trustees can be held accountable.”

The trustees were hired by the New York Fed, which pays each of them $100,000 a year, under a contract completed on Jan. 16 in the final days of the Bush administration. They wield the government’s 77.9 percent stake in AIG through a trust and control votes on asset sales, mergers and the selection of board members and top executives, according to a company filing.

The contract says the trust was created “to avoid any possible conflict” with the Fed’s supervisory and monetary- policy functions. Dudley, the New York Fed president, said in a Jan. 16 statement that the trustees “have a legally binding obligation to exercise all of their rights as majority owner of AIG in the best interests of the U.S. taxpayers.”

Approval of Fed

While the contract says the New York Fed “wishes the trustees to have absolute control over the trust stock” and that developing a divestiture plan for selling AIG shares is a key goal, it states that the trustees cannot sell the shares without the approval of the New York Fed after consultation with the Treasury Department.

Under the contract terms, the New York Fed will control any litigation. If a trustee is indicted or found “to have demonstrated untrustworthiness or to be derelict in the performance of his or her duties,” the New York Fed has the right to remove the trustee.

The agreement doesn’t define untrustworthiness or dereliction of duty.

Considine, 64, is a former chairman of the Depository Trust & Clearing Corp. and served a six-year term on the New York Fed’s board, where she was chairman of the audit and operational risk committee. She was the New York State superintendent of banks from 1985 to 1991 and is lead director of Ambac Financial Group Inc., the New York-based bond insurer whose shares have dropped 98 percent from a 2007 peak.

Feldberg, 69, a former chairman of Barclays Americas, was an executive vice president in charge of the New York Fed’s Bank Supervision Group for nine years through 2000.

Foshee, 49, was chief operating officer at oilfield- services provider Halliburton Co. before joining El Paso Corp. in 2003 as president and CEO.

‘Soft Power’

“The people appointed are long-time Fed players,” said Mark Roe, a professor at Harvard Law School in Cambridge, Massachusetts, who has written a book on corporate governance. “They’re likely to take signals from the Fed anyway, even if not obligated to.”

Steven Davidoff, a law professor at the University of Connecticut in Storrs, Connecticut, said the problem with the trust agreement is that it creates the appearance that the New York Fed is not in control of the AIG shares while allowing the Fed to maintain “soft power” over the company.

“The great value of this agreement is that it allows the government to say it doesn’t control AIG, while keeping its back-door influence over the company,” said Davidoff, who delivered a paper on the AIG rescue at a legal conference in Philadelphia last week. “This gives the government a sort of plausible deniability in this situation.”

“It’s troublesome that the government would take this interest and not control,” because it clouds the question of accountability, Davidoff said.

To contact the reporters on this story: Mark Pittman in New York at [e-mail] or; James Sterngold in Los Angeles at jsterngold2@bloomberg.... Hugh Son in New York at [e-mail].
Last Updated: May 12, 2009 00:00 EDT

THIS IS MY FAVORITE LINE:
While the Fed’s Washington-based Board of Governors is a federal agency subject to the Freedom of Information Act and other government rules, the New York Fed and other regional banks maintain they are separate institutions, owned by their member banks, and not subject to federal restrictions.

DO NOT FORGET LIDDY A GOLDMAN GUY. NY fed gives out our money, no freedom of information, owned by private firms, choose head of NY fed. see who is on the board, any wonder why Geitner does what he does. people who run AIG picked by NT fed, have ability to get rid of them, and can over rule them. any wonder why no haircuts. goldman must be broken up for the sake of democracy in america.

Credit Card Receivables: Even Moody's Thinks the Fed's 'Adverse Case' Is a Joke

this group does more work than anyone when it comes to articles. you may not like what they say, but they post often and provide data to support what they say.


On May 12 01:30 PM truthteller wrote:

> Wow, in what parallel universe, should the investment community trust
> Moody's to assess anything? Anyone want to buy some AAA rated mortgage
> backed securities at full price?
>
> Why should anyone care, whether or not the scenarios are adverse
> enough or not? I mean these analyses are just a guess. The only
> thing that maters is when will the overall economy recover? For
> that, I will just listen to Warren Buffet and watch for an equilibrium
> in housing starts.
>
> For the most part, your articles are STILL just copying and pasting,
> someone elses work. If you are going to post an article online;
> you really should try to come up with some analysis of your own!

Do You Believe Borrowing Leads to Prosperity? (Part 2)

it is worth seeing some of the videos on bloomberg. (taleb, faber,) others. you have to pick and choose. many come in with own agenda.


On May 09 11:27 PM dragonpaw wrote:

> Debt with purpose is good, i.e. legitimate business reasons and in
> most cases short-term . As a former small business owner, I faced
> this repeatedly over a thirty-plus year length; frustrating but worth
> while. Consumer debt is an endless, fruitless, and frustrating cycle.
> It has little value in the life of the average individual, unless
> under extreme and extenuating circumstances.Debt for a home is still
> a good bet, but not for "flipping" and not as a retirement program
> as many are now acutely aware. Debt as away of leveraging debt ,in
> all forms, is a Ponzi scheme-shell-game.Wall Street derivative-types
> and the government fit into this latter category. There is no way
> of insuring or assuring this debt. The latest world-wide financial
> debacle is proof of this at the Wall Street level. The continued
> play-out of the "new depression" will be proof of this at the governmental
> level.
> As for "fiat money", the name itself is oxymoronic. Printing-press
> money (I realize the process is not that simplistic) by nature enentually
> lacks a backing, as has been recently shown for long-term US treasury
> sales. In addition, the deflated interest rates being paid steal
> from the investors of such sales as well as the supposed entitlement
> recipients of atrificially depressed "cost-of -living" benefactors.
> Good luck retirees! You get shafted on both fronts!
> Meanwhile, the average in the electorate remain clueless to this
> process. The supposed optimism of the voting populace will ultimately
> prove to be our downfall. How unfortunate, as this optimism is what
> helped make our country great! Now it will be used by all incumbent
> politicos to further their self-serving agendas.And when disaster
> strikes again (as many like Mr. Quinn are predicting) the same finger-pointing
> charade will begin again. But this we will be up the proverbial
> "s-it-creek" without the paddle.
> What advice to give ; 1) Read everything you can about the global
> melt-down. Don't rely on network news. They are all too limited and
> or biased. Either that,or (is it just me?) that Beck-Limbaugh, Olberman-Madow
> sound equally goofy at times. How do you get your friends to wade
> through this stuff?
> 2)Talk friends and relatives and get them "engaged". Tough times
> are ahead; I want to save my fanny and as many around me as possible.
> Many grasshoppers will be knocking at many ant's doors. I don't want
> the knocking.
> 3)Nothing on the over-all financial landscape has changed and yet
> the "irrational exhuberance" abounds. The only mantra ("Obamantra?")
> we hear is that nothing big can fail,unless it then becomes the
> property of the US citizenry,read here"DEMOCRATIC PARTY" into perpetuity.
> For allpractical purposes there is no other party
> 4)Learn about inverse investments, ep. ETF's. Mr. Quinn has alluded
> to some of these for long-term treasuries. The list is extensive,
> but read caveats completely and invest prudently.
> 5)With any long-term bond position,ask yourself;"Is this a rate That
> I can live with for 10+years?" I don't see any currency worth holding
> at present. For traders, there's always something. It' just not me.
>
> 6) Keep responding to columns like Mr. Quinn's. You guys (and gals)
> are sharp and always keep me thinking and planning. You're voices
> in the wilderness, and much wilder will come to pass.

Do You Believe Borrowing Leads to Prosperity? (Part 2)

I had to rant this morning about how we are getting so screwed by our government. we borrow at the international level 3.2% so we can give money for free to banks so they can lend to us at 6% or so. we as taxpayers have to pay this back. what a crime.

Bank Stress Test: The Cheat Sheet

"The Greatest Boondoggle in History": Banks Buoyed at Taxpayers' Expense
Posted May 08, 2009 04:05pm EDT by Aaron Task in Newsmakers, Recession, Banking
Related: WFC, MS, BAC, C, XLF, ^DJI, ^GSPC
Bank stocks soared Friday, including Wells Fargo and Morgan Stanley, which sold shares a discounts of more than 10% below Thursday's close.

The ability of banks to raise capital is certainly positive but the idea of shares rallying amid the capital raising and dilution is "counterintuitive," Bank of America CEO Ken Lewis said on CNBC this morning.

BofA shares were also rallying even as the government said it needs to raise an industry-leading $33.9 billion. Citigroup stock was also a big winner after the government's curious declaration that it "only" needs to raise $5 billion.

While much of the focus is on the stress tests and banks' efforts to raise cash, the real story is Geithner's Public-Private Investment Program (PPIP), says William Black, an Associate Professor of Economics and Law at the University of Missouri - Kansas City.

The PPIP is the "greatest boondoggle in the history of the world," says Black, a former bank regulator who was counsel to the Federal Home Loan Bank Board during the S&L crisis. As occurred during the S&L era, Black says the PPIP will allow banks to exchange "trash for cash" and turn "real losses into faulty gains."

If the goal of Tim Geithner and other regulators was "to rip off the American taxpayer for the benefit of the least-deserving wealthiest people you can imagine, well - mission accomplished," Black says.

Do You Believe Borrowing Leads to Prosperity? (Part 2)

The mob is out in force to make sure anyone who makes bear comments doesn't get rated high and that way people don't read those comments. I wouldn't be surprised if people are actually paid by some companies to go around marking thumbs down on comments they don't like. Good way to control information. Macro picture hasn't changed. But everyone who points out that the rosy scenario painted by wall street and washington doesn't actually exist gets shouted down. Bush 2 learned from Karl Rowe you could create your own truth. he most likely learned from 1984. Obama is the master though.

Everyone who has done even a bit of reading or trading before can easily see how this market is manipulated. but it is still the big secret. Emerging markets had a railing P/E of 30 yesterday. and that was the reason they sold off. yet today we reached a new high? explain that. was it because when golman turned on their computer this afternoon at resistance (925, with selling going on) we quickly hit a new high. watch the computer trade everytime when we need that bit of a boost to hit a new high or at resistance. or at the close to make sure we don't close below a certain number that would trigger a sell signal. today. we were going to have a nice inside day today before the computer. we didn't. that is manipulation.

Do You Believe Borrowing Leads to Prosperity? (Part 2)

During my MBA I would sit in awe AS MULTIPLE PROFESSORS TAUGHT THE GOSSIPAL of debt. you couldn't argue with them. additionally corps get tax breaks for taking it so the return on equity improves the more of it you have (in good times of course). Therefore, the system is gamed to reward too much debt. ceo's get stock options based on equity prices, and the the guy in the market is happy his stocks are rising. conversely, no debt gets no breaks for the stockholder, cash to pay dividends doesn't reward the ceo (doesn't raise stock prices). there are multiple effects.

when you take maco economics they sit there with all these curves (happiness curves i think) explaining how someone early in life will rationally borrow money against future cash flows. Of course they fail to explain how the consumer is going to do it rationally, or how you know cash flows will appear. But, once more you can't argue with the prof.

So in summary you have a whole system that is rewards too much debt because it allows for log return instead of linear, and they assume debt will be used rationally. It is so fucked up. This was why when I learned the amount of money in the system from mortgage equity withdraws based on overvalued houses I knew shorting the market was a given when things came to a halt. Add to that decreasing earnings over a generation and the outcome is given.

It is impt in this crisis to think ahead on how our government is going to get out of this mess. The clear easy answer for white house and congress is kill dollar and cause inflation to reduce wall street debt. Let fed take heat and they do not have to make any difficult choices that will upset those lobbyists that pay the bills.

Our government no longer works for the benefit of the people, and this crisis has laid it out in the open.If you don't see it it is because you have chosen not too. I wish it wasn't that way, but facts are facts.

10 Highest Paid CEOs for 2008: Unbelievable

This info has been sent to the white house, Barney frank, sen. Charles grassley, and rep elijah cummings. I urge you to write and keep the pressure up

10 Highest Paid CEOs for 2008: Unbelievable

PONZI. YOU BUY WORTHLESS PAPER AND SOME GUY WHO KILLS THE WEALTH GETS RICH.

Government's New Credit Approach: Does the End Justify the Means?

Job of companies is to take what they can, job of government is to protect the people who elected them. some things that are good for society are bad for the market.

Preview from Europe: Another Bumpy Day for Stocks

good point.verify before trust.


On Apr 24 08:12 AM Freya wrote:

> The China report, while correct is a red herring.
>
> They now hold over 1,000 tons, this is over twice as much as they
> held in 2003, they have accumulated about 600 tons over 5 years.
> They have done so quietly without making waves.
>
> It seems like everyone and their mother's uncle is spreading rumors.