said by Rick :

Count me in the market bigtime starting today.

132 pages ago on page one with the dow at 13,800 or so I posted that my portfolio was taken to just 40% stocks/60% bonds.

The last few weeks I've been reversing course having saved myself a 20 to 25% decline overall on the stock side while enjoying a nice return on the bond/fixed investments side.

Yesterday and today..my portfolio is going to 80% stocks/20% bonds. In addition...I've resumed buying into each fund I own and will continue to buy into any further weakness each week.

For me, diversity is everything and for that reason I'm using 4 fund companies and have numerous funds ranging across all sectors and around the globe. While I do own a few individual stocks..I think it's very risky given the credit concerns and the fact we as investors have so little insight into those troubles they may have. Hence why I want the security of hundreds upon hundreds of stocks around the globe.

Is today the bottom? No one can know for sure but what I do know is this selloff has created extreme value in many of the companies that I watch. There is so much cash on the sidelines now that any positive news can turn this market around big time and I'd rather take my chances being in the market bigtime and buying into any dips now than missing a move back up.

We'll see how it goes but that's how I'm playing this.

Good luck to all weathering this storm.

said by AmeritecTech :

Do you think we could perhaps get him to shut up from now on for the rest of his Presidency?

said by sailor :

Word leaked out that President Bush is going to address the nation tomorrow morning.

Edit: I'm serious.

said by justin :

The best explanation I have heard so far is that hedge funds are quietly falling like nine pins. They have closed for redemption for a while but at some point they have to liquidate their positions in order to pay their investors back who will surely be lining up redemption requests.

said by RWoods :

Nikkei 225 down 11%.

said by SipSizzurp :

Good question.

said by Alcohol :

What caused the huge drop today? I was watching earlier and dow was only down 78 points.

said by Alcohol :

What caused the huge drop today?

said by AR :

Okay, let's not go overboard here....this isn't the NWO..just corporate welfare, something that's been going on for a long time now.

said by sailor :

Won't be long before American citizens will never see a statement again from their broker, mortgage company, car payment from their bank or credit union, gas company, fuel oil company, credit card company, etc...Everything will be on one statement and that statement will be on letterhead saying "The United States Government"....Your bill is enclosed" :( :huh:

said by digitalfutur :

Opponents to a government "bail-out" are stupid, ignorant, or sadistic.

said by digitalfutur :

If Fortune 500 companies like AT&T can't sell commercial paper, there's no better indication that this credit crisis is not restricted to Wall Street. I work for GE Corporate Financial Services. GE has some of the best financial minds around. If GE is shoring up its cash reserves, you can bet the dividend that it's for a good reason.

Opponents to a government "bail-out" are stupid, ignorant, or sadistic.

Buffett's Berkshire Hathaway Inc. will buy $3 billion in preferred shares that pay an annual 10 percent dividend and are callable after three years at a 10 percent premium, Fairfield, Connecticut-based GE said today in a statement. The 78-year-old investor also gets warrants to buy $3 billion of common stock with a strike price of $22.25 a share for five years.

Thanks to the Senate Conservatives Fund for posting the 451-page bailout behemoth here. »senateconservatives.files.wordpr···text.pdf

A few of the earmarks stuffed in the bill:

- Film and Television Productions (Sec. 502)
- Wooden Arrows designed for use by children (Sec. 503)
- 6 page package of earmarks for litigants in the 1989 Exxon Valdez incident, Alaska (Sec. 504)

Tax earmark “extenders” in the bailout bill.
- Virgin Island and Puerto Rican Rum (Section 308)
- American Samoa (Sec. 309)
- Mine Rescue Teams (Sec. 310)
- Mine Safety Equipment (Sec. 311)
- Domestic Production Activities in Puerto Rico (Sec. 312)
- Indian Tribes (Sec. 314, 315)
- Railroads (Sec. 316)
- Auto Racing Tracks (317)
- District of Columbia (Sec. 322)
- Wool Research (Sec. 325)

said by sailor :

This is getting lots of attention late tonight ( early Wed AM--10/1/08 )
Was removed once but is now back up as I am posting this.
(youtube clip)

U.S. Securities and Exchange Commission reminded financial services firms that they don't need to use fire sale prices when evaluating their hard to price assets.

"By clarifying how to treat assets in an uncertain market, the SEC is continuing to provide transparency to investors and helping institutions to provide credit in periods of market stress."

MARK-TO-ESTIMATE

The SEC's guidance on Tuesday, came on the last day of the third quarter for most U.S. companies, allowing them to incorporate the changes in their next round of financial statements.

In a document on the matter, the SEC reaffirmed that management's internal assumptions can be used to measure fair value when relevant market evidence does not exist.

U.S. accounting rule makers assume that the factors used to come up with fair values are based on an orderly transaction between willing market participants. The SEC document said that "distressed or forced liquidation sales are not orderly transactions."

A Senate bailout vote is scheduled tomorrow at 9pm Eastern.

No bill details seen yet.

How it will go down…There will be up to 6 roll call votes on the following items:

(1)Motion to concur on the House message, H.R. 2095, Rail Safety;
(2)a Dorgan amendment relating to H.R. 7081, the U.S. - India Nuclear agreement;
(3)a Bingaman amendment relating to H.R. 7081, the U.S. - India Nuclear agreement;
(4)passage of H.R. 7081, the U.S. - India Nuclear agreement;
(5)a Dodd amendment to H.R. 1424, relating to the bailout package; and
(6)passage of H.R. 1424, the bailout.

said by avd706 :

Sorry....

said by PhoenixDown :

On the other hand, sometimes its quicker, easier, and better to simply let the system self destruct so you can pick up the pieces quicker and move forward.

The market is unstable and is in danger of collapsing. I agree that there are things that the government can do to help ease the inevitable fall but the danger of the bailout is that it risks the value of the dollar for no good reason.

To save one thing (the market), are we willing to jeopardize another (the dollar) and what happens if both fail?

said by avd706 :

No its not, instead of reading each post individually, put it in the perspective of where it is in the discussion. My comment is perfectly clear, when you read the post in the context of the preceding posts.

said by digitalfutur :

Time to dig up the Democrats pressuring Fannie Mae and Freddy Mac to lower standards in the mid 1990s for home mortgages, especially to minorities, which then caused banks to do the same, the catalyst for the current mess; though there are other actors.

In 2004, as regulators warned that subprime lenders were saddling borrowers with mortgages they could not afford, the U.S. Department of Housing and Urban Development helped fuel more of that risky lending.

Eager to put more low-income and minority families into their own homes, the agency required that two government-chartered mortgage finance firms purchase far more "affordable" loans made to these borrowers. HUD stuck with an outdated policy that allowed Freddie Mac and Fannie Mae to count billions of dollars they invested in subprime loans as a public good that would foster affordable housing.

Housing experts and some congressional leaders now view those decisions as mistakes that contributed to an escalation of subprime lending that is roiling the U.S. economy.

The agency neglected to examine whether borrowers could make the payments on the loans that Freddie and Fannie classified as affordable. From 2004 to 2006, the two purchased $434 billion in securities backed by subprime loans, creating a market for more such lending. Subprime loans are targeted toward borrowers with poor credit, and they generally carry higher interest rates than conventional loans.
...
In 1995, President Bill Clinton's HUD agreed to let Fannie and Freddie get affordable-housing credit for buying subprime securities that included loans to low-income borrowers. The idea was that subprime lending benefited many borrowers who did not qualify for conventional loans. HUD expected that Freddie and Fannie would impose their high lending standards on subprime lenders.

Banks typically back prime loans with customers' deposits. But subprime lenders often rely on money from Wall Street investors , who buy packages of loans as investments called mortgage-backed securities.

In 2000, as HUD revisited its affordable-housing goals, the housing market had shifted. With escalating home prices, subprime loans were more popular. Consumer advocates warned that lenders were trapping borrowers with low "teaser" interest rates and ignoring borrowers' qualifications.

HUD restricted Freddie and Fannie, saying it would not credit them for loans they purchased that had abusively high costs or that were granted without regard to the borrower's ability to repay. Freddie and Fannie adopted policies not to buy some high-cost loans.
...
But by 2004, when HUD next revised the goals, Freddie and Fannie's purchases of subprime-backed securities had risen tenfold. Foreclosure rates also were rising.

That year, President Bush's HUD ratcheted up the main affordable-housing goal over the next four years, from 50 percent to 56 percent. John C. Weicher, then an assistant HUD secretary, said the institutions lagged behind even the private market and "must do more."

For Wall Street, high profits could be made from securities backed by subprime loans. Fannie and Freddie targeted the least-risky loans. Still, their purchases provided more cash for a larger subprime market.

"That was a huge, huge mistake," said Patricia McCoy, who teaches securities law at the University of Connecticut. "That just pumped more capital into a very unregulated market that has turned out to be a disaster."

In 2003, the two bought $81 billion in subprime securities. In 2004, they purchased $175 billion -- 44 percent of the market. In 2005, they bought $169 billion, or 33 percent. In 2006, they cut back to $90 billion, or 20 percent. Generally, Freddie purchased more than Fannie and relied more heavily on the securities to meet goals.
...

said by Sarah :

Read the context? I've read every post in this thread. And it's unclear what you're referring to.

said by MsTerra :

But what if the lack of confidence is justified? It's hard to see how pumping $700 billion into a malfunctioning system is going to help in the long run. The system needs to be fixed. It should never have been allowed to get this bad in the first place.

said by avd706 :

Cute, but read the context.

said by digitalfutur :

You're mistaking the exception for the trend, and conservative for libertarian.

said by Sarah :

Yeah, having it voted down by 11 instead of 23 would have made all the difference!

said by digitalfutur :

Then you can't blame Republicans for reciprocating in kind, now that the bi-partisan gloves are off.

BTW less this be cast as a bail-out of Wall street, eventually the average Joe will find it difficult to get credit of any kind, including mortgages. Then Congress will have choice but to act if they want to keep their jobs.

This bail-out is more about restoring liquidity and confidence in the lending markets than it is about rewarding Wall street for malfeasance.

When the Savings and Loans Banks were bailed out to the tune of $400 billion in the early 80s, about 70% of that amount was eventually recovered through orderly liquidation of assets. This is the goal with this bill as well.

said by justin :

Either way everyone can agree it is bad for McCain..

MSNBC’s Chris Matthews said: “He’s like a cavalry commander who said ‘Charge!’ and the Republicans went into retreat.”

said by digitalfutur :

Then you can't blame Republicans for reciprocating in kind, now that the bi-partisan gloves are off.

said by avd706 :

Nope.... they should have found 6 more democrats to switch

said by tapeloop :

said by justin :

Apparently, it is all Pelosi's fault. The Repubs were all ready to save america but then a lady went and insulted them with a speech that complained about Paulson.

said by cnn.com :

When the gavel came down, the members on the floor were nearly silent, CNN congressional producer Deirdre Walsh reported. Democratic members immediately met in Speaker Nancy Pelosi's office after the vote, while Republican members went into the office of Boehner, the top Republican in the House.

The stock market immediately dipped hundreds of points after it became apparent that the bill would fail.

The Republican House leadership blamed Pelosi for giving a partisan speech before the voting that they said alienated House Republicans.

While thanking Treasury Secretary Henry Paulson for negotiating on the bill, Pelosi said on the House floor that the Democrats had insisted that the bill "protect the American people and Main Street from the meltdown on Wall Street."

Pelosi also said the cost of the bailout "is a number that is staggering, but tells us only the costs of the Bush administration's failed economic policies -- policies built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision, and no discipline in the system."

After the vote, Boehner said, "Americans are angry, and so are my colleagues. They don't want to have to vote for a bill like this, and I understand that.

"I think that we need to renew our efforts to find a solution that Congress can support. I do believe that we could have gotten there today had it not been for this partisan speech that the speaker gave on the floor of the House," he said.

But Democrats dismissed the Republican complaints, saying the Republican leadership failed to convince their members to support the bill.

"They lost 2-1 on their own side, voting against their president, their presidential candidate, and against every leader in their own party," one Democratic source said.

And one Democratic aide said, "we delivered our votes. They did not deliver theirs."

said by wth :

Weller (R) Ill not voting.....Where's he?

said by JIGA :

Bill failed, now what?

said by TK Junk Mail :

The roll call results. Who voted for and against:
»clerk.house.gov/evs/2008/roll674.xml

said by TK Junk Mail :

The vote counts are changing and the chair won't call the vote as closed. Looks like some arm twisting is going on.

said by TK Junk Mail :

The U.S, House is currently voting on the Wall St/Main St :D bailout bill.

So far the voting is closer than most would like with a 50- 50 split with about half the votes cast.
This one is going to go right to the wire on who wins. But it looks like it is going to be defeated. Watch the markets dive even lower.

said by Rick :

Wachovia taken out by Citigroup in a FDIC brokered deal.
»biz.yahoo.com/ap/080929/wachovia···oup.html

Let's see how fast the stock falls from it's 10.00 a share close to pennies on the dollar.

Amazing really how much things have changed and how the government..which worried about making companies too big to fail have now made Citi, JPMChase and BofA what is quickly amounting to the only banks in the U.S.

said by justin :

I think they are keeping the champagne on ice until they confirm the house republicans will really step up and it will really pass.

One of the disturbing things in this bill is as of wednesday, bank reserve requirements are now 0% .. zero .. and mark-to-market accounting has been suspended.

Also the executive pay limits apply just to the top three officers in the company, and apply only to golden parachutes, not to pay packages.

said by justin :

and mark-to-market accounting has been suspended.

Also the executive pay limits apply just to the top three officers in the company, and apply only to golden parachutes, not to pay packages.

said by RWoods :

Interesting 60 Minutes on the bailout, and how many champagne bottles were popping on Wall Street when the deal was announced.

said by AmeritecTech :

His original request was ridiculous, $700 billion with no oversight on what he, a former CEO of Goldman Sachs, spends it on.

these elements will be included in the legislation.

* Protection for taxpayers, ensuring THEY share IN ANY profits

-- Cuts the payment of $700 billion in half and conditions future payments on Congressional review

-- Gives taxpayers an ownership stake and profit-making opportunities with participating companies

-- Puts taxpayers first in line to recover assets if participating company fails

-- Guarantees taxpayers are repaid in full -- if other protections have not actually produced a profit

-- Allows the government to purchase troubled assets from pension plans, local governments, and small banks that serve low- and middle-income families

* Limits on excessive compensation for CEOs and executives

-- New restrictions on CEO and executive compensation for participating companies:

-- No multi-million dollar golden parachutes

-- Limits CEO compensation that encourages unnecessary risk-taking

-- Recovers bonuses paid based on promised gains that later turn out to be false or inaccurate

* Strong independent oversight and transparency

-- Four separate independent oversight entities or processes to protect the taxpayer

-- A strong oversight board appointed by bipartisan leaders of Congress

-- A GAO presence at Treasury to oversee the program and conduct audits to ensure strong internal controls, and to prevent waste, fraud, and abuse

-- An independent Inspector General to monitor the Treasury Secretary's decisions

-- Transparency -- requiring posting of transactions online to help jumpstart private sector demand

-- Meaningful judicial review of the Treasury Secretary's actions

* Help to prevent home foreclosures crippling the American economy

-- The government can use its power as the owner of mortgages and mortgage backed securities to facilitate loan modifications (such as, reduced principal or interest rate, lengthened time to pay back the mortgage) to help reduce the 2 million projected foreclosures in the next year

-- Extends provision (passed earlier in this Congress) to stop tax liability on mortgage foreclosures

-- Helps save small businesses that need credit by aiding small community banks hurt by the mortgage crisis -- allowing these banks to deduct losses from investments in Fannie Mae and Freddie Mac stocks