High Dollar and other problems

For investors, a rapid rise in the U.S. dollar this month means earnings estimates for many multinational companies will have to come down further.

"I don't think people have caught on to the FX effect," said Jeff Markunas, lead manager of the RidgeWorth Large Cap Core Equity Fund. "The fourth quarter is likely to be so bad it will force analysts to accelerate their estimate cutting. I think the currency headwind gets progressively worse until this time next year."

http://www.reuters.com/article/reutersEdge/idUSTRE49N1H820081024
Clearly the estimates of 4Q earning may be very off in a bad way.

Palin the Future of the replulican party

http://www.knx1070.com/Dissent-Reported-in-Palin-Campaign/3200087
For the record I have not been a replulican since the 80's and was disappointed by Bush 43 and since then I have watch the party of small goverment sign itself over to big spending, socialisim for the rich and a social policy that is a best hostile and at worse almost Purtian like. So it makes perfect since for Palin to be its future. Assuming we have elections in 4 years. I continue to remain vert concerned the financial crisies will bring about radical changes (ie revolution). When a large group of peole is alienated by its governement and seen as bailing out the rich, you open the door for unrest.

Treasury not sure how to spend $7oo Billion

Sheila Bair, who heads the Federal Deposit Insurance Corp., responded that her agency is working "closely and creatively" with Treasury officials to "realize the potential benefits of this authority."

http://biz.yahoo.com/ap/081025/meltdown_evolving_bailout.html
Or maybe the know and just did not tell congress. Either way I find bair comments to be deja vue like, creativley using money. Is that like the Iraq war only costing $200 Billion?

U.S. has plundered world wealth with dollar

http://www.reuters.com/article/forexNews/idUSTRE49N1XX20081024
Right, good luck getting off the dollar right now, with every other currency in the crapper no one is thinking lets dump the dollar. Now when the tresury market collapase lets talk.

IMF and how much ammo do they have...

The amount the IMF has readily available for new (non-concessional) lending is indicated by its one-year forward commitment capacity. This is determined by its usable resources, plus projected loan repayments over the subsequent twelve months, less the resources that have already been committed under existing arrangements, less a precautionary balance. As of end-July 2008, the Fund's one-year forward commitment capacity was SDR127.7 billion (or about $207 billion).

So 1% is going out the door in a emergency loan to iceland, who admits it will need more than that. Start the meter running.

From The NY times.

4:25 p.m. | A Fall fall: October has one week left after today, and I would not dream of forecasting it. But in the unlikely event that prices do not move from today’s closing levels, here is how September-October will rank on the list of worst two-month periods for U.S. stock indexes.

Dow Jones industrials (1920 to 2008)

1. April-May 1932, down 39%
2. March-April 1932, down 31%
3. October-November 1929, down 30%
4. October-November 1987, down 29%
5. August-September 1931, down 29%
6. September-October 1929, down 28%
7. September-October 2008, down 27%
8. November-December 1931, down 26%
9. April-May 1931, down 25%
10. September-October 1987, down 25%

Standard & Poor’s 500 (1928-2008)
1. April-May 1932, down 39%
2. September-October 2008, down 32%
3. March-April 1932, down 30%
4. August-September 1931, down 29%
5. October-November 1987, down 28%
6. September-October 1931, down 25%
7. May-June 1932, down 24%
8. April-May 1940, down 24%
9. September-October 1929, down 24%
10. September-October 1987, down 24%

Nasdaq composite (1971-2008)
1. September-October 2008, down 34%
2. February-March 2001, down 34%
3. October-November 1987, down 31%
4. October-November 2000, down 29%
5. September-October 1987, down 29%
6. November-December 2000, down 27%
7. August-September 2001, down 26%
8. April-May 2000, down 26%
9. August-September 1990, down 21%
10. July-August 1998, down 21%

Looking at those lists gives me some comfort. Are these two months really comparable to the Depression periods of 1931 and 1932, or to the crash months of 1929? Will the economy do as badly as it did then? Is the threat to civilization comparable to the spring of 1940, when Germany conquered western Europe? Is the current period really worse for Nasdaq companies than the bursting of the tech bubble in 2000 and 2001?

If the answer to those questions is no, then perhaps the selling is overdone.

In answer to the questions he poses, Yes it may be that bad. Yes it will do that bad. It took hitler from 34-40 to build the army, one might suggest after we lose a few counrties we are ripe for anotehr messiah to appear. Tech Bubble was bad cause money fled and people did some pretty stupid stuff (Look at you pets.com). Today Bankers did stupid thing with stupid stuff they did not understand (CDO,CDS,Deriviaties). What the final outcome will be is as yet unknow.

Banks slow to show loses?

http://www.247wallst.com/2008/10/what-the-ncc-nc.html
Say it aint so? Come on if any bank CEO had an ounce of balls they would announce there true loses instead of hiding them with acocunting tricks and level 3 assests.
Look for PNC to thrive.

Letter from a retailer

Dear Valued Customer,

The international financial crisis is weighing heavily on all of us. As consumers, one factor that we all need to consider is the stability of the companies with whom we do business. In the current economic climate, many retailers will stumble and some will even fail. For that reason, I personally want to explain Crutchfield's unique situation.

For many years, I have been concerned about the growing credit bubble. It was obvious to me that it was unsustainable and that an inevitable day of reckoning would come. To protect our customers, our employees, and my family from the disastrous consequences of a financial meltdown, I positioned Crutchfield to withstand the worst. We became very frugal with how we spent money. We did not pay outlandish executive salaries and bonuses. We did not build fancy facilities. We did not expand our retail store operations. And we did not buy other companies. Instead, we worked extremely hard to improve how we serve our customers, while we managed every aspect of our business with excellence. Furthermore, we paid off all of our debt and accumulated cash reserves.

When shopping in times like these, you need to be certain that the retailer will be around to provide you with years of after-the-sale support. We know that you expect guarantees, warranties and promises of lifetime product support to be kept when you purchase with us - and I have positioned our company to deliver without compromise on all of these important elements. As retailers go, Crutchfield is a "Rock of Gibraltar." We have no debt, a perfect credit rating and a legacy of fiscal prudence. Therefore, we will be around to serve you as we have served millions of customers for the past 34 years and throughout the last four recessions.

Purchasing from Crutchfield today means you are choosing a company that will help you use and enjoy your purchase now and in the future. I hope that you'll give Crutchfield a chance to exceed your expectations. I thank you for your time and, most importantly, for doing business with Crutchfield.


Bill Crutchfield
Founder and CEO, Crutchfield Corporation

Glad to hear someone is without debt out there.

KY

http://www.time.com/time/specials/packages/article/0,28804,1849130_1849126,00.html
Key to see what the election will mean is this race, if you can not hold on to a leadership person who is well regarded. With the democrats looking to take a super-majority in both house and president. The american people we have a goverment just like the last depression, how did that work out? Not so good, Most of the stuff roosevelt did was bad and made the deperession much worse. He was also once of the most socialist presidents we ever had.

WSJ

http://online.wsj.com/public/page/crunch.html
Now has a special crunch page!

Russia Part Duex

http://www.themoscowtimes.com/article/600/42/371893.htm
Wow

Vneshekonombank, which does not even report to the Central Bank because it has no banking license, will soon take charge of $74 billion, or 14 percent of the country's reserves.

Taiwan must have adults running the banks.

http://www.asianinvestor.net/article.aspx?CIaNID=87297
Taiwan says your debt no good, GSE cry.

Crashes and systems

http://anz.theoildrum.com/node/4656#more
Good read on what a crash might look like on this fine day

Russia nears defaults

http://www.telegraph.co.uk/news/worldnews/europe/russia/3248672/Russian-default-risk-tops-Iceland-as-crisis-deepens-financial-crisis.html

Wow, if russia defaulted you can kiss the supply of oil and natural gas goodbye for europe.

http://ftalphaville.ft.com/blog/2008/10/24/17418/cds-report-crossover-hits-900/
So a 1000 is usually a defauly level, so the whole index is now nearing default.

Future Limits Tested

http://www.cnbc.com/id/27357308
In what may be a reply of 1929, we have heavy selling which may lead to more selling on Monday or Tuesday

Working Paper 666

http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=4062
Really, 666 are they trying to scare us or what?

Belarus

http://www.bloomberg.com/apps/news?pid=20601085&sid=aOsHjsAsOUac&refer=europe
Adds it name to IMF list. The credit crunch is making it very tough for those nations which are not position to be self sufficent. And where does that leave the USA? The last refugee, but no one is happy cause of the increasing debt levels.

mexico

http://online.wsj.com/article/SB122479386443263919.html
Pemex's revenue feeds the goverment coffers. Which makes the company very cheap in making any investments. Till they fix this it will continue to slowly fail. When it finally fails, mexico is done.

AIG

http://www.bloomberg.com/apps/news?pid=20601087&sid=ayLsDQa5TZTQ&refer=home
Really they need more? Gues the hunting trips are taking there toll.

Roubini Says `Panic'

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ax3ZRmJRccyo

Either this is dead on and things may be choppy or he is being Conservative. Either way time for DXD,DOG PUTS all the way

Libor and other problems

http://www.moneymorning.com/2008/10/23/mortgage-re-sets/
So if the LIBOR is being fix, is this just a sign that other problems are being masked to hide the extent of the problems? If so this indicates a greater chance of dramatic fall. Cause the market can not process the information correctly you may get a case where multiple pieces of bad news hit at the same and each is worse then expected and Markets hate downside surprises.

Barclay's

http://money.cnn.com/2008/10/19/news/companies/barclays.fortune/index.htm?postversion=2008102111
I like this guys and when the market bottoms, this will one great buy.

Argentina

http://ftalphaville.ft.com/blog/2008/10/23/17354/would-you-like-some-chips-with-that-argentine-exposure/

Down go the countires....I like the short play on all the banks lisited. I especial think Santander is put itself way out there.

Eastern Europe

http://ftalphaville.ft.com/blog/2008/10/23/17371/cds-report-european-credit-default-swaps-hit-record-wides/
Is the next focal point of problems.
If Oil hits 55-50 look for russia to spike again.

From FT quote of the day

http://ftalphaville.ft.com/blog/2008/10/23/17376/quote-of-the-day/
Captures the sentiment perfectly

So I like to for idea;s in oft beaten places

http://www.chinasmack.com/
Love this site, takes the best of chinese blogs and translates them to english

bond market dislocation

If this does not scare you it should.
Here is how it works, you borrow money and issue bonds to loaner. The more you borrow the more risky your bonds become, increasing the rates people charge you to give you money. The more you pay in interest the less you have in real income. Now of course you are not the only person borrowing money, the government, other companies , other countries, etc. Now some governments can cause problems by issuing massive debt and driving up the rates for others. Also you can defaults by other people which spoke the market. Now imaging the scale increase and you the follow.
Massive home mortgage failures, governments start to default (Small places like Iceland) and Banks become insolvent.

It also means that now that the foreigners can get a higher rate of interest on the gov't debt they buy, the market for existing lower-rate non-gov't and gov't debt will drop, tanking bond prices across the board.

New bond issuers will have to raise the rates they pay their lenders to attract interest in their bonds, raising debt service costs for them too.

This will spread to mortgages as well. Mortgage rates will rise, causing an increase in the rates ARM and Option ARM holders will have to pay, forcing even more of them into foreclosure and making those assets that we issued that debt to buy even more worthless.

Now accelerate and what do you get? 1931....

What caused the flight out of bonds during GD 1.0? Governments around the globe started to default on their debt. Every time a domino fell, bond traders asses tightened up even further. They started to say, hey Fed your going to have to pay me a higher return for this kind of risk.

A once in a lifetime credit crisis has three components.

1st Numerous homeowner defaults
2nd Large number of banks become insolvent
3rd Large number of governments default on their debt

How will you know when there's a bond market dislocation. When the stock market starts to decline, and there's a simultaneous and sustained flight out of bonds as well (under normal conditions a flight to safety out of stocks entails moving to bonds, however under this scenario there is a flight out of stocks and bonds into short term treasuries) It got so bad during the great depression that for a time, investors were willing to have a negative return to keep their money parked in treasuries.

http://64.233.169.104/search?q=cache:wWqWQdaf458J:www.tickerforum.org/cgi-ticker/akcs-www%3Fpost%3D62732+bond+market+dislocation+1931&hl=en&ct=clnk&cd=1&gl=us
Both qoutes are from this forum and are summary information.

Also check out this link from better graphs
http://activerain.com/blogsview/735192/Credit-Market-Update-For-The-Week-Bond-Market-Dislocates

Scary as all hell

The national debt has grown $300 billion in the first 16 days of this fiscal year — an annual rate of 75%. At this pace, the US government will owe $17 trillion by this time next year.

From http://www.agorafinancial.com/5min/

Jim Roger comments of the day

http://www.cnbc.com/id/27317048
I like Jim's comments a lot and from my investment stand point agree with buying what is out of favor as the best way to go.
Looking at you FCX :)

Emering Markets

From the RGE, The bigger question, is your money better positioned in the downturn to buy in the emerging markerts or the Europe/USA?

Iceland
Iceland has been at the forefront of the global credit crisis. What was essentially a banking crisis has turned into a national crisis as Iceland’s banks appear too big for the government to rescue.

Highly leveraged, Iceland’s banks heavily relied on wholesale funding to finance their aggressive expansion abroad. With the rapid depreciation of the local currency and the seize-up of credit markets, Iceland’s banks were having trouble refinancing their debt and appeared headed for collapse when the government stepped in and nationalized the three biggest lenders.

Now reports suggest Iceland’s government is poised to announce a reported $6 billion rescue package from the IMF. While such a package would be a positive step in providing liquidity, there is no question that a severe economic contraction is coming. Some analysts predict Icelandic GDP could shrink by 5-10% after almost 5.0% growth in 2007.

Hungary
Also hard hit by the global credit crisis is Hungary. While it’s not suffering a banking crisis a la Iceland (in the sense that its banking sector is mostly foreign-owned, rather than made up of highly leveraged, internationalized domestic banks), it is similar to Iceland in that the global credit crisis has exposed long-simmering vulnerabilities. High levels of foreign currency lending, slow growth (1.3% in 2007), twin deficits (both current account and budget), and heavy reliance on non-deposit foreign funding all contributed to making Hungarian assets sell-off targets.

The ECB came to Hungary’s rescue last week, saying it would lend as much as EUR5 billion ($6.7 billion) to Hungary’s central bank to help revive the local credit market. But the verdict is still out on whether the ECB credit line and government measures are enough to prevent Hungary from becoming an ongoing hotspot.

Given Hungary’s woes, eyes are focusing on the rest of Eastern Europe for signs of trouble. The slowdown in the region’s key export market, the Eurozone, is expected to dent growth across the region. Meanwhile, high current-account deficits and widespread foreign currency lending are particular risk factors. Poland and the Czech Republic are considered among the least vulnerable, but they are far from immune. Meanwhile the Baltics, Bulgaria, and Romania have long been on analysts’ radar as particularly weak links.

Baltics
All three Baltics (Estonia, Latvia, and Lithuania) boomed over the last seven years and posted double-digit growth rates at their peak, helped by cheap credit from Scandinavian parent banks and EU membership in 2004. Now these economies are in the midst of a sharp slowdown, with Latvia and Estonia officially in recession.

There is no question that the Baltics are in for hard times. In the context of the global credit crisis, the risk is that foreign capital inflows could dry up and lead to an even sharper slowdown that could infect the financial sector. But there are some factors that suggest the sharp slowdown might not evolve into a full-fledged, Iceland-level crisis. One, external deficits in the Baltics are funded to a large extent by inflows from Swedish parent banks, and sharply cutting off credit would hurt these banks. Two, substantial foreign ownership of banking assets limits the governments’ contingent liabilities, as Swedish parent banks would be expected to provide support to their Baltic subsidiaries if they get into trouble. Three, the Baltics’ sharp slowdowns have led to speculation that devaluations (they have exchange rates pegs to the euro) could be in the offing. While devaluation cannot be completely ruled out, such fears may be overblown as these countries tend to have shallow financial markets, relative little hot capital, and successfully defended against speculative attacks earlier this year.

Bulgaria and Romania
Bulgaria and Romania – the so-called ‘gravity defiers’ – are also on the short-list of CEE economies most at risk of being the next hotspots in the global credit crisis. Despite massive current-account deficits (projected to hit 23% of GDP in Bulgaria and 16% of GDP in Romania this year), booming credit growth, and high inflation, these economies have not hit slowdown mode yet – hence the term ‘gravity defiers’.

In the case of both countries, the financing of their current-account deficits has deteriorated, with foreign direct investment (seen as less subject to reversal than other forms of financing) only plugging about a third of Romania’s current account gap and over half of Bulgaria’s. As a result, these economies are highly susceptible to capital outflows, which would trigger a harsh real adjustment.

Another risk is these countries’ high degree of foreign currency lending, particularly notable in Romania which has a flexible exchange rate, meaning unhedged borrowers are highly exposed to currency swings. Romanian households’ high levels of foreign currency lending are similar to those in Hungary (55% in Romania vs. 60% in Hungary of total household loans). And like Hungary, Romania has a budget deficit of over 2% of GDP. Meanwhile, Bulgaria has a budget surplus, which potentially gives its government more room to maneuver if outflows trigger a sharp slowdown. Bulgaria and Romania will be key countries to watch as the global credit crisis unfolds.

Balkans
The negative effects from the credit crunch on the Balkan region have been limited so far. Growth has remained strong, ranging between 4.3% for Croatia and 8.2% for Serbia in Q1 08. Nonetheless, the significant widening of the current account deficit experienced by most of the countries is a source of concern as both external credit and FDI inflows are likely to slow. Croatia may feel severe pressures since it has the highest foreign debt in the region, at 90% of GDP, and the share of foreign currency mortgages and personal loans is near the level seen in Hungary.

Turkey
A number of analysts have cited Turkey as particularly vulnerable to global market turmoil given its large current account deficit. At 5.8% of GDP in 2007, Turkey’s deficit – while substantial – is lower than many of its emerging Europe peers though. The financing quality, however, has deteriorated of late and it will be important to watch how this trend evolves. Compared to other CEE countries, however, Turkey is less likely to face a bank-related credit squeeze, since the banking sector is relatively liquid with a loan-to-deposit ratio well below 100% and since wholesale borrowing is a smaller fraction of banking sector liabilities. So while Turkey is not immune to the global credit crisis and will experience slower growth, it is much better placed than earlier in this decade to weather the storm.

Ukraine
Ukraine’s high reliance on external finance makes it particularly vulnerable in this global economic downturn and credit crunch, leading it to seek financial assistance from the IMF. Worsening macroeconomic fundamentals including persistent inflation and a widening trade deficit and domestic and regional political uncertainty have contributed to deposit outflow, tighter domestic money market rates and exchange rate volatility, increasing near term risks for Ukraine's banking sector. The value of the Ukrainian currency, the hryvnya, sank by 20% so far in October forcing the National Bank of Ukraine to intervene and sell dollars at an artificially low rate. Moreover, the equity markets fell over 70% this year.

South Africa
Despite a growth rebound to 4.9% in Q2 2008, South Africa cut its growth forecast to 3% for 2009 on worries that a global recession would depress export demand (especially of metals) and investment inflows needed to finance its current account deficit. The fall in commodity prices has pressured the Rand, which fell to its lowest level since 2003, and domestic equity markets. The South African Reserve Bank left its benchmark interest rate unchanged at 12% for a second consecutive time, even after inflation reached a record 13.6% in August. Meanwhile, President Thabo Mbeki's resignation ushered in a period of political and economic uncertainty.

UAE
The UAE is one of several oil exporters starting to feel the pinch from the reversal of speculative capital that flowed in early this year to bet on currency revaluation. Long-term project finance costs already tightened throughout the GCC earlier this year and the freezing of global credit markets exposed UAE banks which financed rapid credit growth with foreign not local borrowing. As a result, local interbank rates more than doubled to over 4.6% despite liquidity injections and a central bank liquidity provision for UAE banks. However, although Dubai’s liabilities might be much greater than its assets, most participants and ratings agencies still assume that the federal government (read Abu Dhabi, home of the largest sovereign wealth fund) will step in if they get into serious trouble. Yet, with the oil price and capital inflows falling the UAE’s surpluses and will be smaller next year even if its budget still balances and worries about Dubai’s property market are looming.

Kazakhstan
Despite its oil wealth, a reliance on short-term borrowing by its banks abroad has left Kazakhstan, one of the few oil exporters to run a current account deficit, exposed. However, unlike some of its neighbors, it will use domestic funding including the $27 billion National Oil Fund to cushion its economy. But with the oil price dropping and new output delayed, Kazakhstan is set for much slower growth next year, particularly as its previously bubbly property market is cooling quickly

Pakistan
Pakistan, recently hit by a political crisis, is also on the verge of a balance of payments crisis as large capital outflows and decline in forex reserves – below-adequacy levels – pose risk to finance the oil-led ballooning fiscal and current account deficits, and external debt payments. To prevent debt default, the government is seeking $10-15bn in loans from IMF, ADB and World Bank and might approach strategic donors like Saudi Arabia and China. The stock market and currency slump have also led to liquidity injections by central bank along with restrictions on stock trading, short selling, and the establishment of a stabilization fund.

Indonesia
A single day double-digit plunge in stock indices in early-October pulled down Indonesia’s stock market helped push the index down over 40% year to date leading authorities to suspend trading and ban short-selling. Capital outflows, rupiah decline and credit tightening have invited central bank intervention in money and currency markets. But the rundown of forex reserves poses significant risk to the subsidy-laden fiscal deficit and commodity correction-hit current account. Balance of payments risks are only exacerbated by the high foreign-currency denominated debt causing the government to seek loans from World Bank and other multilateral institutions.

South Korea
South Korea is the most vulnerable of Asian countries to a sudden stop of financial flows. Korea looks set for another financial crisis given its vulnerabilities that include: the highest loan-to-deposit ratio in the region, rapid growth of short-term foreign debt, a current account deficit, a slowing property market, high food/fuel prices squeezing small- and medium-sized enterprises in the construction industry as well as consumers and large corporations facing an export slowdown. Its currency is down roughly 30% year-to-date despite the announcement of a bank support package as foreign investors have pulled out of Korean assets in a flight-to-safety and de-leveraging that marks the global credit crisis. Many fear Korea's credit crisis will shape up to a repeat of 1997 but others believe that, due to its large war chest of forex reserves and its status as net creditor to the world, Korea's interbank dollar funding squeeze is unlikely to become a 1997 redux. The most worrisome sources of a potential Korean credit crisis are not the foreign currency bank debt built up from hedging exporters' USD shorts and the interest rate arbitrage that resulted as a by-product. Such foreign debt can surely exacerbate the de-leveraging that Korea’s bank sector faces, however the real fire starter for a Korean crisis is domestic debt. Korea needs to restructure after having over-invested in construction/real estate companies and over-lent to households. With a slowing economy endangering asset quality, Korean banks will need to get pickier about who they loan to.


Argentina
The global financial meltdown has put Argentine's private pension assets in jeopardy. Argentina's government could move to take over the management of $28.7 billion in private pension funds that sharply declined in value this year due to global turmoil. The government is attempting to increase the pool of money it can borrow from in order to meet debt obligations next year. As of now, retirement and pension fund administrators manage private pension accounts for 9.5 million depositors, of which some 40% are active contributors. Essentially, most mandatory funds flow into the private pension system would now become part of the government's pay-as-you-go public pension scheme. Besides that, the government would have access to some USD 1.2bn per year in new flows currently deposited in the system. The idea of using social security funds to avoid a default (or to pay the debt) next year should cause a sharp drop in confidence in the country and in its government.

Venezuela
In Venezuela, the key problem is the fact that its sovereign wealth fund, known as Fonden, holds about $300 million in debt instruments that Lehman had agreed to cash. With Lehman’s bankruptcy, Venezuela will have a hard time selling the debt. Moreover, the Venezuelan's sovereign wealth fund has a significant amount ($2billion) allocated in structured notes that have lost part of their value amidst crumbling markets, and therefore they are hard to cash to cover expenses. Meanwhile the fall in the oil price may crimp Venezuela’s fiscal expansionism.


BRICs
Although the BRIC economies are not as vulnerable as these over-exposed and smaller Emerging markets, they do not appear immune to the global economic downturn and credit crunch.

The financial crisis has triggered downwards revisions in economic growth in Brazil for 2009. While the country is set to post 5.1% this year, the forecast for 2009 is 2.8%. The financial crisis and decline in commodity prices which tent to reduce the amount of exports contribute to lower growth.

So far, Russian consumers have remained insulated from the loss of wealth in the equity market and troubles that Russian banks face in rolling over their debt, but growth is likely to slow to 5-6% next year from 7% plus in 2007. Meanwhile financing costs are on the rise, eating into corporate profits and the falling oil price may limit a planned investment spree, particularly as a large amount of Russia’s savings are tied up in the domestic banking sector and attempts to avoid a bust in the Moscow property sector.

India is taking a severe hit from the global financial crisis with the stock market down over 50% year to date, FII outflows crossing $10bn and the currency plunging over 20% year to date. While the central bank is injecting liquidity, easing bank credit and capital inflows, cutting policy rate to contain risks to the financial sector and downtrend in asset markets, correction in the near-term seems inevitable. Double-digit inflation, high interest rates and global liquidity crunch will significantly impact domestic demand and industrial activity in 2008-09 pulling down the recent boom. Moreover, twin deficits, both approaching 10% of GDP, pose a challenge as forex reserves decline.

Q3 marked the fifth consecutive slowing of Chinese real GDP growth. Slowing industrial production and real fixed investment are suggesting more weakness ahead particularly if the worst consumer sentiment since 2003 persists. Slowing growth implies fewer commodity imports – even if government sponsored infrastructure projects pick up some slack – clouding the outlook for countries like Brazil, Chile and Australia, among others. The Chinese government fiscal and monetary responses, which have already begun, could cushion its fall and aid in its rebalancing. Yet falling asset prices are taking their toll on local and national fiscal coffers and corporate profits and consumption could be the next shoe to drop as robust retail sales may not stand up to slowing income growth.

Yahoo

http://www.alleyinsider.com/2008/10/yahoo-to-blow-mass-firing-announcement-paralyze-company
Really at some point you will be a penny stock and think to yourself, maybe I have should have taken all that cash from microsoft.

Rules are for normal times...

http://www.reuters.com/article/ousiv/idUSTRE49K7DW20081021?sp=true

For the political junkie in all of us.

http://www.fivethirtyeight.com/

Who saw it coming?

http://www.theconglomerate.org/2008/10/turning-a-blind.html
Once again people can see past there current decsion very well or greed is good for the short time won out, either way bad times.

Coming Soon: The $600 Trillion Derivatives Emergency Meeting

http://seekingalpha.com/article/99674-coming-soon-the-600-trillion-derivatives-emergency-meeting?source=front_page_most_popular_articles
More good news..NOT

Dollar is done

http://www.globalstockmonitor.com/archives.php?id=136
Gold's time is near, once the dollar rally ends.

There is a book in this crap

http://globaleconomicanalysis.blogspot.com/2008/10/keynesian-claptrap-from-pimco.html
I going to write a book about the fact these people can not see passed one decision. Let inject money into the banks to save them! Great! What the wont lend? what mortage rates are going up? Put more money in the banks! Great? What the credit problems are getting worse?

From what may be the funnest web site on business

http://www.minyanville.com/articles/economy-PACKAGE-Stimulus-Checks-recovery-recession/index/a/18373

Signs God has a sense of humor

http://ftalphaville.ft.com/blog/2008/10/21/17257/fdic-forgot/

Big Brother's cafe watches you eat

http://news.yahoo.com/s/ap/20080922/ap_on_re_eu/lunch_in_the_lab
We continue to underestimate how many decision are made subconsciously. Total great stuff.

Day Labor

http://www.nytimes.com/2008/10/20/nyregion/20laborers.html
when unemployement increases and you start to see a glut of labor,you begin to get the ingridents for unrest, when these people return home you flood a country with unemployed males who become easy targets for a messiah figure to appear with an answer to all there problems. For people saying the weimer republic is on the way, remember it ended with Hitler.

Nothing should scare us more then this.

http://www.haber27.com/news_detail.php?id=14307
Think of the market as a prize fighter that has gone 11 rounds with tyson. In the 12 he whacks you with a haymaker, and you are down for the count. Same effect. Isreal bombs Iran, Iran attack Isreal, USA attacks IRAN, OIL goes to 150-200,the economy collapases. Good luck mr president to be.

Bond bargin

http://www.bloomberg.com/apps/news?pid=20601213&sid=atV9Ioht2Buo&refer=home
With whatever is coming it is clear this will be baragin for those looking to preserve captial

Why google is overpriced.

http://www.alleyinsider.com/2008/10/let-s-be-serious-online-display-ads-will-fall-sharply-in-2009

could not agree more.

http://market-ticker.denninger.net/archives/616-The-Folly-Of-A-Depression-Thesis.html

Dennis Hopper and this lady

http://themessthatgreenspanmade.blogspot.com/2008/10/what-would-jim-rogers-do.html

Are crazy

Jim Rogers what to do

Scary the shorts and the market may not be your friend

http://www.nypost.com/seven/10192008/business/the_pretenders_134253.htm
If you drive the shorts underground you lose the counter arguements on stock which may have very bad results. The shorts are not crimials. The people running companies who are using accounting to hide bad results are.

Another great read for the day

http://ftalphaville.ft.com/blog/2008/10/20/17216/time-for-the-darwinian-flush/

Where to make money and how to protect assest should be the first questions we ask.

Awesome Post on FT alphaville 1929!

http://ftalphaville.ft.com/blog/2008/10/20/17229/monetary-dove-down/