Imminent and severe market correction

[Kauri]

the Fed funds futures market gives 94% odds of another 25 bps cut at the October 28-29 FOMC meeting. .. .. and the UK seems to think thier darling will pay out another 50 in a week or two... and the

cheers
..........kauri

 

[chops_a_must]

VIX popping again.

GM down about 6% within a minute or so...

 

[Kauri]

The NY Times is reporting that the US Treasury is considering taking ownership stakes in many US banks to try to restore confidence, according to government officials. The article states that the lack of success in unlocking frozen credit markets is forcing Treasury too look at that option and 700 BLN USD bailout bill gives them the authority to inject cash directly into banks that request it. The Treasury plan, still preliminary, resembles one announced on Wednesday in Britain. The article goes on to say: "The American recapitalization plan, officials say, has emerged as one of the most favored new options being discussed in Washington and on Wall Street. The appeal is that it would directly address the worries that banks have about lending to one another and to other customers."

Chweers
.............Kauri

 

[Aussiejeff]

The NY Times is reporting that the US Treasury is considering taking ownership stakes in many US banks to try to restore confidence, according to government officials. The article states that the lack of success in unlocking frozen credit markets is forcing Treasury too look at that option and 700 BLN USD bailout bill gives them the authority to inject cash directly into banks that request it. The Treasury plan, still preliminary, resembles one announced on Wednesday in Britain. The article goes on to say: "The American recapitalization plan, officials say, has emerged as one of the most favored new options being discussed in Washington and on Wall Street. The appeal is that it would directly address the worries that banks have about lending to one another and to other customers."

Chweers
.............Kauri

Hmmm. If the US Treasury took ownership of most of the major banks and BOOTED all the top execs off to a deserted tropical island with a miniscule Golden Parachute each and replaced those Bozos with their own el-cheepo Guvmint salaried Bozos, how much would they save the economy? Have to be in the Billions?

Wot a great idea! Go Fed , GO!!

 

[sam76]

Happy anniversary all.

 

[GreatPig]

Iceland Closes Stock Exchange.

Trading on the Iceland stock exchange has been suspended until Monday as hundreds of millions of pounds invested by British councils is at risk in the country's crisis.

Bloody whinging Poms.

GP

 

[chops_a_must]

From my noob analysis of such things, it looks like both Ford and GM are being priced in for bankruptcy.

I think we all knew it was going to happen sometime, but perhaps not this quickly?

 

[noirua]

Iceland Closes Stock Exchange.

Bloody whinging Poms.

GP

Latest figure is AU$2.5 billion with majority of councils having not yet declared.
There are a lot of companies that are thought to have Aussie connections who put their money into Iceland's banks. Guess we'll hear late as usual.

 

[Kauri]

From my noob analysis of such things, it looks like both Ford and GM are being priced in for bankruptcy.

I think we all knew it was going to happen sometime, but perhaps not this quickly?

Wholesale sales fell 1.0% in August, mostly the result of weak demand for
autos and petroleum products. The latest sales decline is the biggest one-month drop in 19 months. July's change, originally reported to be -0.3%, was revised lower to -0.8%. The data show that wholesalers are unable to get rid of excess inventories and signal a likely slowdown in production. Due to poor September unit auto sales, expect another drop in September wholesale sales and another rise in inventories.

cheers
............Kauri

 

[Edwood]

8,500 Dow - nearly at the 7,500, should do it tomorrow at this rate. What a run hey! tomorrow is a turn date mind...

 

[chops_a_must]

Wholesale sales fell 1.0% in August, mostly the result of weak demand for
autos and petroleum products. The latest sales decline is the biggest one-month drop in 19 months. July's change, originally reported to be -0.3%, was revised lower to -0.8%. The data show that wholesalers are unable to get rid of excess inventories and signal a likely slowdown in production. Due to poor September unit auto sales, expect another drop in September wholesale sales and another rise in inventories.

cheers
............Kauri

More to do with the implied vols.

Super cali freakin unbelievable!

+350% seems to be reserved for dead ducks...

 

[Bushman]

From my noob analysis of such things, it looks like both Ford and GM are being priced in for bankruptcy.

I think we all knew it was going to happen sometime, but perhaps not this quickly?

GM is a dead duck now. They cannot raise debt (S&P have just placed them on negative credit watch), they cannot raise equity and that means they are dead from a cash point of view (unless the poor old US taxpayer steps in via the Fed).

Good article. Only quote that matters is that 18% of their sales in 2007 came from the subprime lending market. Debt propped up their balance sheet and inflated their p&l!

http://money.cnn.com/2008/10/09/news/companies/taylor_death_watch.fortune/index.htm

CDS spreads on GM and Ford are in the thousands of % now. That is pricing in bankruptcy. What then for the widely quoted $55trillion CDS derivative market? GM was one of the biggest issuers of corporate bonds in the US market.

No wonder AIG failed.

Question is will the US taxpayer bail out the auto industry now that the bond market is washing its hands of it?

 

[chops_a_must]

It has to, doesn't it???

The flow on effects would be enormous. Catastrophic.

They are running the gauntlet of complete social upheaval in certain parts with this one...

 

[gfresh]

Re: Imminent and severe market crash

Another 7.3% down on the DOW last night .. massive, the crash is in progress. People were talking about 8000 being the next support, and at this rate we're only 1 or 2 days away!

Rapid re-adjust for serious recession, probably what should have happened months ago, when even the more conservative commentators were starting to see there were serious problems.


Good question would be what happens to the Australian operations / Holden if GM goes under? Going to be some big fallout too. 9th largest company in the world.. some 266,000 employees

Surely they can't nationalise an auto maker?? ...can they?

GE not looking very good at all either. There's going to be big fallout if that keeps falling .. very big.

 

[Aussiejeff]

Re: Imminent and severe market crash

*snip*... Good question would be what happens to the Australian operations / Holden if GM goes under? Going to be some big fallout too. 9th largest company in the world.. some 266,000 employees

Surely they can't nationalise an auto maker?? ...can they? ...*snip*

Gee, I hope the Bathurst 1000 goes ahead in two days time..... two days! So far away....

Maybe next year there will be a Guvmint run Bathurst 50?

 

[chops_a_must]

Geez... it's awfully quiet in here today...

 

[sam76]

Geez... it's awfully quiet in here today...

A picture tells a thousamd words....

 

[Sean K]

Geez... it's awfully quiet in here today...

Cripes! What was that that just went flying down past the office window??

 

[Aussiejeff]

Cripes! What was that that just went flying down past the office window??

[size=+1]$uper$wanDiver[/size]?

 

[nioka]

This thread must have a name change. Leave out the "imminent".Even the original Bull will now admit to "severe". However all is not lost. The market WILL recover. Even if we have not reached the bottom there are a lot of stocks that are good value and 'now is the hour" to adjust your portfolio. I've just placed some buy orders and a few "sell the dogs" and build in some tax losses. Happy trading, chances like this do not come around often, make the best of a bad lot.