The Last Dead Bull on Wall Street

By Mike Whitney

Whew! What a week for the stock market. On Wednesday the market took a 360 point nosedive followed, two days later, by a 220 point belly-flop. By the time it was over, the trading pits looked more like a sausage-packing plant than the world’s financial epicenter.

THE LOSSES MULTIPLY

Analysts see little good news on horizon as fallout from high oil, weak dollar, subprime write-downs still spreading. But the debt machine is still growing. The NY Times reported that three big banks have reorganized their superfund, simplified it and geared it up to ease the problem—BUT—read this. There are major probles buried in the seventh paragraph of an article at the bottom of the page in the Sunday Times.

The new fund’s potential impact is unclear. Debt market conditions are rapidly deteriorating, leading some analysts to declare them worse than nearly a decade ago, when the Long-Term Capital Management hedge fund collapsed. Investors’ appetite for pools of assets — from mortgages to auto and credit card loans, more recently — has all but dried up. And virtually all structured investment vehicles, commonly called SIVs, are trying to unload the securities they hold, on the assumption that the proposed backup fund will not work.

CREDIT CARD GIANT IN IPO

SAN FRANCISCO (MarketWatch) - Visa Inc., the world’s largest card payments processor, filed plans for a $10 billion initial public offering late Friday, following its main rival MasterCard Inc., which went public in May 2006.

The Visa offering would make it the ninth-largest IPO ever and the second-largest by a U.S. company, according to Dealogic.

Visa said it generated net income of $771 million in the first nine months of this year and operating revenue of $3.73 billion. Last year, the company made $437 million on $3.91 billion in sales.

Visa said it has the potential to grow as people, companies and governments change from paper-based to electronic payment. Global card purchase transactions are set to grow 11% a year from 2006 to 2012, with particularly strong growth in Asia, Latin America, the Middle East and Africa, the company said, citing The Nilson Report, an industry newsletter.

PERSONAL VIEWS: FROM A BLOG: “I FEEL DOOM”

The title for this posting comes from one of my students, who often utters those words when I announce a project or distribute a test. But I can think of no more appropriate words than “I feel doom” to sum up how I see the downward slide of our nation’s economic health. My sinking feeling began last summer, when two banks told me that, due to defaults on mortgage payments and the paucity of those who deposit savings, both banks didn’t have enough money to loan out. And now, in the past week alone, I’ve been seeing alarming stories about the devaluing of losses at Citigroup, Merrill Lynch, Morgan Stanley, Wachovia, and Capitol One. Sooner or later, our nation’s economic problems, if I interpret them correctly, will touch you in a way you won’t be able to ignore.

MORE LIES FROM THE BUSH ADMINISTRATION
By Dr. Laurie Roth NewsWithViews.com

The bottom line is, right now we are surviving because of our strategy to get more loans and deal with our over the top and tornado like debt spiraling our currency into monopoly money! No wonder we are stealing from our seniors and lying about it! I guess we hope that the masses just trust our Government much like many of us blindly trust medical doctors. They can do no wrong either.