Monday Crash

[cottonpicken]

Bear Sterns,100 dollar oil,1000 dollar gold,usdx 71,panic fed rate cuts.

Monday might be carnage time.

Sunday nights are always interesting but tonight may be special.But i hope not.

[jensend]

the other day i was looking at stock charts from the late twenties and early thirties. can anybody tell me where a person would find commodity charts for that period? i'm wondering if grains and metals had a runup just before that crash. i don't know that this is the same but the straightup rise in prices now indicates more technicals and speculation than fundamental supply and demand factors. imho.

[jensend]

the other day i was looking at stock charts from the late twenties and early thirties. can anybody tell me where a person would find commodity charts for that period? i'm wondering if grains and metals had a runup just before that crash. i don't know that this is the same but the straightup rise in prices now indicates more technicals and speculation than fundamental supply and demand factors. imho.

[jensend]

Wall Street fears for Next Great Depression (1930's style)

Sunday, 16 March 2008


Wall Street is bracing itself for another week of roller-coaster trading after more than $300bn (£150bn) was wiped off the US equity markets on Friday following the emergency funding package put together by the Federal Reserve and JPMorgan Chase to rescue Bear Stearns.


One UK economist warned that the world is now close to a 1930s-like Great Depression, while New York traders said they had never experienced such fear. The Fed's emergency funding procedure was first used in the Depression and has rarely been used since.

A Goldman Sachs trader in New York said: "Everyone is in a total state of shock, aghast at what is happening. No one wants to talk, let alone deal; we're just standing by waiting. Everyone is nervous about what is going to emerge when trading starts tomorrow."

In the UK, Michael Taylor, a senior market strategist at Lombard, the economics consultancy, said on Friday night: "We have all been talking about a 1970s-style crisis but as each day goes by this looks more like the 1930s. No one has any clue as to where this is going to end; it's a self-feeding disaster." Mr Taylor, who had been relatively optimistic, has turned bearish: "It really does look as though the UK is now heading for a recession. The credit-crunch means that even if the Bank of England cuts rates again, the banks are in such a bad way they are unlikely to pass cuts on."

Mr Taylor added that he expects a sharp downturn in the real UK economy as the public and companies stop borrowing. "We have never seen anything like this before. This is new territory for us. Liquidity is being pumped into the system but the banks are not taking any notice. This is all about confidence. The more the central banks do, the more the banks seem to ignore what's going on."

Mr Taylor added that the problems unravelling at Bear Stearns are just the beginning: "There will be more banks and hedge funds heading for collapse."

One of the problems facing the markets is that, despite the Fed's move last week to feed them another $200bn, the banks are still not lending to each other.

Full article: http://www.independent.co.uk/news/business/news/wall-street-fears-for-next-great-depression-796428.html

[FarmRanger]

I wonder if the printing presses will be working 3 shifts over at the federal treasury?

Another 200 billion last week. Interesting times.

[cottonpicken]

"the thirties"-is a completly wrong analogy.

Theres just to many differences.

Please god i hope i'm wrong.

[mcfarms]

http://www.nytimes.com/2008/03/16/business/16gret.html?bl&ex=1205812800&en=e2c8b398ef89c553&e i=5087%0A

Cotton you might find this interesting.

[mcfarms]

Not to bad of an opening. I can live with it.

I don't know how much more my ticker can take of the volatility!!

[cottonpicken]

Well folks we got a quarter point cut,on a sunday night.

What happens tuesday?.75 my guess.

Interesting times indeed.

[jensend]

look at the depreciation in share price!



JPMorgan buys Bear Stearns for $2 a share
By Francesco Guerrera in New York and Henny Sender in Abu Dhabi

Published: March 16 2008 18:03 | Last updated: March 16 2008 23:29

JPMorgan Chase on Sunday night agreed to buy Bear Stearns, the stricken US investment bank, for around $230m in shares in a deal that puts an end to Bear’s 85 years of independence and highlights the serious risks faced by banks during the credit crunch.

JPMorgan’s cut-price takeover of Bear, which has the backing of the Federal Reserve and the Treasury, was agreed before the opening of Asian markets on Monday morning in an attempt to stave off a run on other banks.

EDITOR’S CHOICE
In depth: Bear Stearns - Mar-16Lex: Queasy Street - Mar-16Wall Street waits for the next domino to fall - Mar-16Paulson ready for further stability measures - Mar-16CDS sector weighs Bear Stearns backlash - Mar-16Hedge funds keep safe distance from Bear - Mar-16However, the deal, which values Bear at just $2 per share, compared with the $169 hit in January last year and the $30 reached on Friday, will wipe out the value of the investments of Bear’s shareholders including some of its senior management.

JPMorgan said that in addition to the emergency loans extended to Bear on Friday, the Fed had agreed to provide fund up of $30bn of Bear’s less liquid assets.

The rare arrangement significantly decreases JPMorgan’s risks and underlines the authorities’ concerns at the prospect of seeing one of the largest US investment banks go under.

The Federal Reserve and the Treasury feared that unless the Bear crisis was resolved promptly, there was an increased risk traders might turn their sights on other US and European banks.

“The Fed is most nervous about the systemic risk,” said one senior executive at Bear, the fifth largest investment bank in the US, before the deal was announced “The government needs to stabilise the financial system.”

Hank Paulson, Treasury secretary, on Sunday afternoon had sought to allay fears that the crisis of confidence that hit Bear - which was undone by clients’ rush to withdraw funds amid rumours over its financial health - would spread to the rest of the financial sector. In TV appearances, he defended the Fed move to keep Bear afloat and reiterated the government’s willingness to protect the financial system. “The government is prepared to do what it takes to maintain the stability of our financial system,” he said. “That’s our priority.”

The takeover will enable Jamie Dimon, JPMorgan’s chairman and chief executive, to add Bear’s prime brokerage franchise and mortgage business to his bank.

However, JPMorgan is likely to sell or downsize other businesses, such as Bear’s investment bank. However, it is likely to keep Bear’s headquarters building in midtown New York, which is close to JPMorgan’s present headquarters. Lay-offs among Bear’s 14,000 employees are also likely.

JPMorgan had been contacting clients to inform them of the coming consolidation. An executive in its private banking side told one client that the private bank had taken control of $150m in assets of Bear’s clients.

“JPMorgan stands behind Bear Stearns,” Mr Dimon said on Sunday. “This transaction will provide good long-term value for JPMorgan Chase shareholders”.

Alan Schwartz, Bear chief executive said: “The past week has been an incredibly difficult time for Bear Stearns. This transaction represents the best outcome for all constituencies”.

Additional reporting by Demetri Sevastopulo, Peter Thal Larsen, Anuj Gangahar and Hal Weitzman

[cottonpicken]

Good article.Very true and hard hitting for mainstream.

True wealth is starting to show itself.

And its not paper.

[cottonpicken]

CP, Jensend, where did you guys get your information tonight??? I got nothing!!

[cottonpicken]

Oh my god!

[cottonpicken]

No Dish tonight!! Otherwise could've saw it on BNN. Just received it 18 minutes ago.

My real time quotes are screwed up tonight also. Anyone else having problems?? Definitley not the time to have screw ups.

Went short tonight in Beans!

[cottonpicken]

Gold up 23 bucks

Nikkie down over 400

Usdx down.5

Emergency rate cut of .25

Tuesdays cut -reported full point

Worst news-i dont have enough beer to get me through tonight