World economy talk

[uls]

I wonder why there's no news from Capitol Hill about any rescue plan. And even after the release of those bad figures by Ford and GM, the Dow still manage to close on the upside...

Market players considered last night a buying opportunity.

Buy on dips, sell on rallies

that's the only strategy that works these days.

[tidus1203]

Technical move more than anything else. Price discounts everything, news is irrelevant. When the market drops 10% in 2 days its only natural to claw some back.

[uls]

things are really bad na pala for GM

At the close of trading, Fitch and the other rating agencies cut GM debt ratings.

Fitch said GM will either be bailed out or will be forced to default and restructure.

"Given the current liquidity level of $16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default."

critical na pala GM

[creepy]

Buy on dips, sell on rallies

that's the only strategy that works these days.

This sounds curiously like a "Buy Low" and "Sell High" strategy...

[uls]

hehe

too scary to buy and hold for more than 24 hours...

the market is now dominated by day traders.

[uls]

Peter Schiff on CNBC Nov. 3, 2008

[ame="http://www.youtube.com/watch?v=SSixu-wxvKI"]YouTube - 11/3/2008 -Peter Schiff On Squawk Box:Economic Impact Of Obama Victory[/ame]

Peter Schiff Rulez!!

[Monseratto]

Haha... ayaw nila makinig kasi sobrang nakakatakot yung katotohanan. "We want out free money back!!!".

[Monseratto]

Public enemy # 1 ni Peter Schiff si Greenspan pala...

[ame=http://www.youtube.com/watch?v=ANEv7yElbaI]10/14/2008 - Ron Paul Advisor Peter Schiff On AC 360[/ame]

[Monseratto]

Apparently the US politicians are more inclined to throw money than reform a flawed business model...

The Americans have dumped capitalism and are embracing socialism. But when their currency goes bust, I wonder what will they embrace next?

Democrats want Bush to help ailing automakers

WASHINGTON – Democratic leaders in Congress asked the Bush administration on Saturday to provide more aid to the struggling auto industry, which is bleeding cash and jobs as sales have dropped to their lowest level in a quarter-century.

House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid said in a letter to Treasury Secretary Henry Paulson that the administration should consider expanding the $700 billion bailout to include car companies.

"A healthy automobile manufacturing sector is essential to the restoration of financial market stability, the overall health of our economy, and the livelihood of the automobile sector's work force," they wrote. "The economic downturn and the crisis in our financial markets further imperiled our domestic automobile industry and its work force."

Automakers already want an additional $50 billion in loans from Congress to help them survive tough economic conditions and pay for health care obligations for retirees.

Automakers want the new loans included in an economic aid plan that is now more likely to come together early next year rather than in a postelection session of Congress this month. If Congress approved more loans, it would come with strings attached. Potential protections include limits on executive compensation, awarding the government preferred stock in the companies and a suspension of dividend payments to investors.

GM, the nation's largest automaker, warned Friday that it may run out of money by the end of the year after piling up billions in third-quarter losses and burning through cash at an alarming rate. GM's chairman and chief executive, Rick Wagoner, said the company will take every action possible to avoid bankruptcy. GM has planned more job cuts, including another 5,500 salaried and factory workers, but company officials warn that those measures alone would not be enough and that federal aid was essential.

Ford, which recently announced it would slash more than 2,000 white collar jobs, also has seen a rapid decline in its cash supply. But it is in better shape because the company borrowed billions of dollars in 2007 by mortgaging its factories. The company said it had enough cash to make it through 2009.

"We must safeguard the interests of American taxpayers, protect the hundreds of thousands of automobile workers and retirees, stop the erosion of our manufacturing base, and bolster our economy," the Democratic leaders in Congress wrote.

President-elect Obama said Friday his transition team would explore policy options to help the auto industry. Obama's economic transition team includes two allies of the U.S. auto industry — Michigan Gov. Jennifer Granholm and former Rep. David Bonior, D-Mich.

[uls]

Amazing

the 700B bailout plan now includes car companies

The US govt is bailing out everyone...

who's gonna bailout the US govt?

hehe

[tidus1203]

Don't worry the US can always bail themselves out via the printing press as long as China and Japan continues to trust the paper they hold.

[uls]

But China is mad

U.S. has plundered world wealth with dollar: China paper
http://www.reuters.com/article/topNe...49N1XX20081024

BEIJING (Reuters) - The United States has plundered global wealth by exploiting the dollar's dominance, and the world urgently needs other currencies to take its place, a leading Chinese state newspaper said on Friday.

The front-page commentary in the overseas edition of the People's Daily said that Asian and European countries should banish the U.S. dollar from their direct trade relations for a start, relying only on their own currencies.

commentary on the article:

One of China's most respected government newspapers has accused the USA of using the greenback to loot the wealth of the global community, and though the article is not a reflection of official Chinese government policy it signals a growing consensus in the world's richest and fastest growing economies that the USA can no longer be allowed to continue its unwarranted domination of the global economy.

The global economic meltdown brought on by irresponsible US policies and towering debt, the lack of regulation, dollar domination and corporate greed is the watershed which will see the virtually bankrupt USA take a lesser position in the the new global pecking order, as Washington will be forced to make concessions to its angry creditors just to continue to borrow to stay afloat with its unproductive economy, wars and crippling debt.

[uls]

As expected...

AIG needs more money

http://www.nytimes.com/2008/11/10/bu...=1&oref=slogin

The Treasury Department and the Federal Reserve were near a deal to abandon the initial bailout plan and invest another $40 billion in the company ... When the restructured deal is complete, taxpayers will have invested and lent a total of $150 billion to A.I.G., the most the government has ever directed to a single private enterprise. ... The revised deal, which may be announced as early as Monday morning ...

why?

The government is also planning to spend an additional $30 billion to help A.I.G. buy up a type of securities called “collateralized debt obligations” that the company had agreed to insure against default. As the insurer of those securities, A.I.G. has been forced to put up large amounts of cash as collateral as the global economy has soured and the securities seemed increasingly likely to default.

Indeed, these securities, worth hundreds of billions of dollars, are held by institutional investors around the world, a fact that government officials have cited to justify saving the company using taxpayer money.

To pay counterparties.

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What a mess.

[tidus1203]

Hehehe ang bilis pala ng cash burn ng AIG it was just early last month that they got a bailout. This is what you call a broken business, throwing money into a broken business is just wasting good money. Pero sabagay the money was just printed anyway, its all a joke!

[uls]

oo nga e...

$85B ubos na

September lang yan.

[Monseratto]

Look who's having the last laugh...Americans are living in a fantasy.

[ame=http://www.youtube.com/watch?v=B8r-nDBx5Jg]Peter Schiff Was Right 2006-2007[/ame]

Ayaw talagang makinig sila sa katotohanan...Pinagtatawanan yung mga warnings.

[Monseratto]

America is doomed...

[ame=http://www.youtube.com/watch?v=sMdF1CiQAkA&NR=1]Peter Schiff predicts doomed economy under Obama[/ame]

[tidus1203]

Yep I remember back in 2006 they always made fun of Peter Schiff. No one is laughing now!

[uls]

haha

Peter Schiff rulez!!

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Circuit City files bankruptcy

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a Deutsche Bank analyst:

Price target on GM stock: $0

GM will not have enough money to fund its operations beyond 2008...

the US govt bailout will wipe out shareholders

[Monseratto]

Signs of the times...And to think this is just the start of worse things to come...

Starbucks sees profits evaporate

Starbucks has seen its fourth-quarter profit almost wiped out by the cost of closing under-performing outlets and falling customer numbers.

Deutsche Post to cut 9,500 jobs in US

ATLANTA – Delivery company DHL, hit by heavy losses and fierce competition, is significantly reducing its air and ground operations in the U.S. and cutting 9,500 American jobs, leaving rivals like FedEx, UPS and the U.S. Postal Service to fight over the customers it will stop serving.

The risk to the economy is that layoffs cause more Americans to tighten their belts. As they cut back on their purchasing, business reduces its production, laying off yet more workers.

"We are now entering a vicious cycle," says economist Bob Brusca of Fact and Opinion Economics in New York. "It's like a snowball going downhill. If you stop the snowball when it's small, you can stop it. But if you wait too long, it gets too much mass and becomes dangerous."

The latest evidence of the layoff problem came Friday when the Labor Department reported that the unemployment rate in October skyrocketed to 6.5 percent, its highest level since February 1994 and up from 6.1 percent in September. The economy shed 240,000 jobs, the second worst month of the year after September, when 284,000 jobs were lost.

How bad can it get? In a normal month, the economy needs to provide 125,000 new jobs. During a bad recession, Mr. Brusca says, the economy can shed as many as 500,000 jobs a month.

"The important thing is that some of the key indicators are now reading as weak or weaker than these deep recessions," says Brusca. "We have every reason to think this is as bad as a deep recession."

The economic numbers are deteriorating so fast that many economists are revising downward their estimates for growth. One is Scott Anderson of Wells Fargo Economics in Minneapolis, which now projects the economy will shrink by 3 to 4 percent in the fourth quarter. He has revised his unemployment forecast to 8 percent from 7.4 percent. An economy operating optimally grows 3 to 4 percent per year.

"The danger is this thing could drag on longer than we thought," he says.