Here's another article about the likely boost to retail spending resulting from government-promoted mortgage-deadbeat-ness:

[url=http://www.financialarmageddon.com/2010/04/it-makes-sense.html]It all makes Sense[/url]

And here's the past week's HFT-algo-and-daytrading-frenzy in shares of bankrupt (and in publicly announced "common shares will be rendered worthless" fashion) monoline insurer Ambac Financial (ABK - the BK is for "bankrupt" ;), illustrated via the 5-day chart. Remember: for every gambler who managed to sell above $3, there was some idiot who bought at the same price + $.01:

Greece should just default! This dra(ch)ma has gone on for too long!

[QUOTE=garo;211874]Greece should just default! This dra(ch)ma has gone on for too long![/QUOTE]

Ouch ... I'm only jealous that I didn't think of it first. ;)

All I really have for today is that [url=http://www.zerohedge.com/article/geroge-soros-warns-biggest-market-crash-come-we-are-facing-yet-larger-bubble-credit-crisis]Goerge Soros thinks it`s another bubble[/url], too. Only questions are how high does the Dow Jones Icarus Index fly before the music stops this time, and how hard the ensuing fall will be. Oh yeah, and how the PTB spin the next bust as "unexpected".

Speaking of bubbles deflating, some cool pictures of the volcanic eruption in Iceland floating around the web ... this satphoto I ripped and cropped-for-size from ZeroHedge (who ripped it from someone else's rippage, no doubt) nicely shows the dust plume heading SE from Iceland toward northern Scotland and mainland Europe. Between strikes and volcanos, are any planes flying over Europe nowadays?

[quote=ewmayer;211968]Speaking of bubbles deflating, some cool pictures of the volcanic eruption in Iceland floating around the web ... this satphoto I ripped and cropped-for-size from ZeroHedge (who ripped it from someone else's rippage, no doubt) nicely shows the dust plume heading SE from Iceland toward northern Scotland and mainland Europe. Between strikes and volcanos, are any planes flying over Europe nowadays?[/quote]Not around here they're not. I'm due to fly to Brno on Sunday. Stansted is still closed, as is all of UK airspace and a good fraction of that between here and the Czech republic. The ash is drifting south so I'll probably find that by the time the UK and Benelux have flights again, southern German and Czech airspace will be closed.

Ho hum.

Paul

[QUOTE=xilman;211994] Stansted is still closed, as is all of UK airspace and a good fraction of that between here and the Czech republic.[/QUOTE]Chunnel Time!

[quote=Uncwilly;212025]Chunnel Time![/quote][strike]Pretty near[/strike] fully booked already.

Czech airspace is closed at least as far as PRG. BRQ can't be far behind.
Paul

Banks Discover the Joys of Microloan Usury
 

[URL="http://www.nytimes.com/2010/04/14/world/14microfinance.html?src=me&ref=world"]Banks Making Big Profits From Tiny Loans[/URL]
[quote]In recent years, the idea of giving small loans to poor people became the darling of the development world, hailed as the long elusive formula to propel even the most destitute into better lives.

Actors like Natalie Portman and Michael Douglas lent their boldface names to the cause. Muhammad Yunus, the economist who pioneered the practice by lending small amounts to basket weavers in Bangladesh, won a Nobel Peace Prize for it in 2006. The idea even got its very own United Nations year in 2005.

But the phenomenon has grown so popular that some of its biggest proponents are now wringing their hands over the direction it has taken. Drawn by the prospect of hefty profits from even the smallest of loans, a raft of banks and financial institutions now dominate the field, with some charging interest rates of 100 percent or more.

“We created microcredit to fight the loan sharks; we didn’t create microcredit to encourage new loan sharks,” Mr. Yunus recently said at a gathering of financial officials at the United Nations. “Microcredit should be seen as an opportunity to help people get out of poverty in a business way, but not as an opportunity to make money out of poor people.”
...
Underlying the issue is a fierce debate over whether microloans actually lift people out of poverty, as their promoters so often claim. The recent conclusion of some researchers is that not every poor person is an entrepreneur waiting to be discovered, but that the loans do help cushion some of the worst blows of poverty.
....
Making pots of money from microfinance is certainly not illegal. [B]CARE, the Atlanta-based humanitarian organization, was the force behind a microfinance institution it started in Peru in 1997. The initial investment was around $3.5 million, including $450,000 of taxpayer money. But last fall, Banco de Credito, one of Peru’s largest banks, bought the business for $96 million, of which CARE pocketed $74 million.[/B]

“Here was a sale that was good for Peru, that was good for our broad social mission and advertising the price of the sale wasn’t the point of the announcement,” Helene Gayle, CARE’s president, said. [B]Ms. Gayle described the new owners as committed to the same social mission of alleviating poverty[/B] and said CARE expected to use the money to extend its own reach in other countries. [/quote][I]My Comment:[/I] Hmmm ... I would like to ask the kind folks at Banco de Credito one question about their alleged commitment to eliminate poverty: "Whose poverty - theirs or yours?"

Dude, where`s my hearteningly durable recovery?
 

Flash back to a mere 2 days ago, when we read this bullish headline:

[url=http://www.bloomberg.com/apps/news?pid=20601103&sid=avxlYX3VlcZo]Retail Sales in U.S. Rise, Inflation Stays Contained as Recovery Quickens[/url]: [i][u]Americans heartened by an improving job market[/u] flocked to shopping malls and auto showrooms in March, raising the odds of a durable economic recovery.[/i]

These Bloomberg folks really should try to get their "nascent-and-still-fragile-but-now-possibly-durable-to-to-heartened-consumer-job-market-sentiment economic recovery narrative" straight, because today we read this:

[url=http://www.bloomberg.com/apps/news?pid=20601103&sid=a90aiaZb98us]U.S. Consumer Sentiment Unexpectedly Drops Amid Pessimism Over Job Market[/url]: [i]Confidence among U.S. consumers unexpectedly fell in April to the lowest level in five months, [u]indicating Americans are discouraged about the labor market[/u].[/i]
[quote]April 16 (Bloomberg) -- Confidence among U.S. consumers unexpectedly fell in April to the lowest level in five months, indicating Americans are discouraged about the labor market.
...
Lagging confidence threatens to restrain household spending, which accounts for about 70 percent of the economy. While recent figures showed retail sales picked up in March, a 9.7 percent unemployment rate and mounting home foreclosures are risks for [b]the recovery[/b].

“This raises doubts about the consumer and leaves one feeling uncertain about the pace of [b]the recovery[/b],” said Rob Carnell, chief international economist at ING Financial Markets in London. “We’re not seeing much in the way of labor market progress. People are still worried about home prices.” [/quote]


[b]SEC Briefly Pulls Head Out of Own Ass, Tells Squid "Joo Got Some 'Splainin To Do":[/b]

In a hissy-fit response, the folks at Vampire Squid Inc. decide to briefly flip the HAL 9000 perma-market-manipulating algos from "steady pump" to "take a dump" mode, just to show who`s boss - you didn`t really think Google`s earnings had the slightest thing whatever to do with today`s selloff, did you?

[url=http://www.bloomberg.com/apps/news?pid=20601103&sid=aYwfAoC6G0P0]Stocks in U.S. Extend Declines as SEC Charges Goldman Sachs With CDO Fraud[/url]: [i]U.S. stocks retreated, halting a six-day rally, after the Securities and Exchange Commission charged Goldman Sachs Group Inc. with fraud and earnings at Google Inc. trailed some analysts’ estimates.[/i]
[quote]Goldman Sachs tumbled 10 percent after the SEC sued the company and one of its executives for misstating and omitting key facts about a product tied to subprime mortgages. JPMorgan Chase & Co., Bank of America Corp. and Morgan Stanley sank at least 3.5 percent as all 27 shares in a gauge of diversified banks and brokerages retreated. Google, the owner of the world’s most popular search engine, plunged 5.4 percent after its report underscored the rising cost of pursuing growth in new markets.

“Investors are reacting to headlines of Goldman being charged,” said David Lutz, managing director of equity trading at Stifel Nicolaus & Co. in Baltimore. “Everybody knew there were a lot of issues with subprime securitization. But the fact that they’re targeting Goldman Sachs weighs on the psychology of the financial sector.” [/quote]
[i]My Comment:[/i] Wow ... for the incompetent, agency-level victim of regulatory-capture Stockholm syndrome which is the SEC to actually *charge* one of the major actors in the Biggest Swindle in World History would normally be a heartening development. But if their kid-gloves treatment of other TBTFs to date - e.g. Bank of America in the matter of the non-material-disclosure fraud related to the 2008 Merrill Lynch acquisition - is any guide, the SEC will end up levying a token fine which is a miniscule fraction of the amount of ill-gotten gains resulting from the fraud, and there will be exactly 0 indictments of any of the individual perpetrators. And only the number-of-days figure in my counter at bottom of this post will rise.

On a more-humorous note, this being Friday and all and me not wanting to leave a completely sour taste in readers` mouths, there was a very funny spate of reader-comments in a recent ZeroHedge thread about [url=http://www.zerohedge.com/article/company-no-equity-value-most-actively-traded-stock-market#comments]the trading frenzy in Ambac[/url], in which several commenters adapted well-known movie quotes to fit Wall Street - here is what one reader said about Goldman (i.e. the Vampire Squid of Matt Taibbi`s now-famous [i]Rolling Stone[/i] article), using a riff on Robert Shaw`s classic soliloquy in [i]Jaws[/i]:
[quote]"You ever see a squids's eyes? He's got lifeless eyes. Black eyes. Like a doll's eyes. When he comes at ya, doesn't seem to be living... until he bites ya, and those black eyes roll over white and then... ah then you hear that terrible high-pitched screamin'. The market turns green, and despite all the buyin' and the hollerin', they all come in and they... rip you to pieces."[/quote]

--------------------------------

Today is Day [b]1164[/b] since the start of the global financial crisis, and there have been [b]0[/b] related criminal convictions.
[quote][/quote]

We can now close this thread. The cover of Newsweek magazine has declared "America's Back".

[url]http://ndn3.newsweek.com/media/34/041910_DOMcvr-coverhomepage.jpg[/url]

[QUOTE=Prime95;212050]We can now close this thread. The cover of Newsweek magazine has declared "America's Back".

[url]http://ndn3.newsweek.com/media/34/041910_DOMcvr-coverhomepage.jpg[/url][/QUOTE]

I guess that does indeed settle the issue, then ... time to dust off my old "Dow 36,000" rally cap from late 2007 and get with the program. Here's a link to the [i]Newsweek[/i] article - I find the cover photo of the headquarters of JP Morgan apt, since for them and the other TBTFs the recession is indeed over ... so what if Banana-Republic Ben had to mortgage the future of the real economy to do it? Saving the [strike]bloodsucking leeches[/strike] capital markets was surely worth it.

[url=http://www.newsweek.com/id/236190]The Comeback Country[/url]: [i]How America pulled itself back from the brink—and why it's destined to stay on top.[/i]
[quote]...The long-term decline of the U.S. economy has been greatly exaggerated. America is coming back stronger, better, and faster than nearly anyone expected—and faster than most of its international rivals. The Dow Jones industrial average, hovering near 11,000, is up 70 percent in the past 13 months, and auto sales in the first quarter were up 16 percent from 2009. The economy added 162,000 jobs in March, including 17,000 in manufacturing. The dollar has gained strength, and the U.S. is back to its familiar position of lapping Europe and Japan in growth. Among large economies, only China, India, and Brazil are growing more rapidly than the U.S.—and they're doing so off a much smaller base. If the U.S. economy grows at a 3.6 percent rate this year, as Macroeconomic Advisers projects, it'll create $513 billion in new economic activity—equal to the GDP of Indonesia.

So what accounts for the pervasive gloom? Housing and large deficits [i][ewm: 20% real unemployment? Nothing to see here, folks][/i] remain serious problems. But most experts are overlooking America's true competitive advantages. The tale of the economy's remarkable turnaround is largely the story of swift reaction, [b]a willingness to write off bad debts and restructure, and an embrace of efficiency—disciplines largely invented in the U.S. and at which it still excels. America still leads the world at processing failure[/b], at latching on to new innovations and building them to scale quickly and profitably. "We are the most adaptive, inventive nation, and have proven quite resilient," says Richard Florida, sociologist and author of [i]The Great Reset: How New Ways of Living and Working Drive Post-Crash Prosperity[/i]. If these impulses are embraced more systematically and wholeheartedly, the U.S. can remain an economic superpower well into the current century.[/quote]
[i]My Comment:[/i] Wow - I guess I was wrong about the whole "hiding bad debts and doing our very utmost to prevent the much-needed deleveraging, failure of insolvent institutions and restructuring needed to lay the foundations for durable economic recovery" thing, because as the article assures us, all those issues have been swiftly addressed and taken care of. I feel ever so much better ... time to load up on Ambac and AIG stock, especially because today`s little market bump-in-the-road provides such a clear opportunity for "dip buying".

[Aside: Does that mean "buy the dips", or "buy, you dips"? I always get confused on that point].

Ernst, you are glossing over the elephant under the bed. The single biggest issue - and it is very tangled and twisted - is the level of true employment in the current economy. Over the next few weeks, pay careful attention to the unemployment report. Strip it down and find the actual number of people who have jobs today and compare that number to a comparable month in 2007. Don't forget to factor in the census effect though it is negligible in the overall scheme.

What you will find is fits and starts with some markets improving and many declining. The key is that people are still losing jobs at a rate greater than the number of new jobs being created. This is the major economic weakness that is holding inflation at bay. This is the crucial issue that politicians must address if they want to stay in office. This is the concern that is crippling our economy, not for the big banks and lenders, but for the average Joe on the street. The surgery was a success, unfortunately, the patient died.

DarJones