Pinnacle Entertainment , operating casinos in regional U.S. markets, posted a wider fourth-quarter loss, due mainly to costs related to opening a new casino, while Harrah's, which operates Las Vegas Strip resorts like Caesars Palace and the Flamingo, posted a fourth-quarter loss, burdened by impairment charges and losses at its properties in Illinois and Indiana.

Gary Loveman, Harrah's chief executive, said on a conference call that results at regional casinos were "mixed," while in Las Vegas "the gaming business has held up well, but room rates are off a bit."

Boyd Gaming Corp , which owns and operates 17 casinos in seven states, posted a 45 percent drop in fourth-quarter profit.

Boyd, which is building Echelon on the Las Vegas Strip, said net income fell to $31.2 million, or 35 cents per share, from $56.3 million, or 64 cents per share, a year earlier.
From All Bets Are Off: Casinos Feel Economic Pain

House discusses $15 billion mortgage bailout

House members are discussing a tentative plan would allow the government to purchase up to 1 million mortgages over five years in an effort to help struggling borrowers avoid foreclosure and financial markets avoid more credit-related losses. The loans would be bought by the Federal Housing Administration, a Depression-era agency that insures loans made to borrowers with poor credit.

The effort shows that the housing crisis has evolved to the point where government officials are considering bailing out large groups of borrowers and Wall Street investors.

Now there is an operative phrase: Wall Street investors. I am too sure that Congress wants to bail out ordinary people, except that some of these people vote; however, the Federal Reserve was created to protect the big financial institutions and after already plunging hundreds of billions of dollars of imaginary money into the system to protect Citigroup, Bear Stearns and the like. Congress now wants to do its part. Will the quid pro quo show up as campaign contributions, money in offshore accounts, hmm? Just how in the hell long can a government, which is now spending $3 TRILLION a year, keep inventing new money? (which makes the old less valuable) And where is the money coming from for the economic stimulus plan? Water on the moon? "Money from nothing" seems to be this government's mantra--Democrat and Republican alike.

I did not get an adjustable rate mortgage or any other such nonsense, did not use a credit card as if it was a gift card, did not trade up to a new vehicle every year--I still drive my '92 Ford, and I am sick and tired of all the whining people who now can't make ends meet and the politicians who want to make it all better with free money. That's my life that all these foolish losers on Wall Street are also affecting and they get a bailout for being stupid and greedy. I think we need a national anthem. Throw all the bums out and start again.

Tony Blair has been holding discussions with some of his oldest allies on how he could become full-time president of the EU council, the prestigious new job characterised as "president of Europe". For more go to: I'll be president of Europe if you give me the power - Blair

And I imagine that fellow Bilderberg Group invitee, Bill Clinton, after taking care of Bosnia, Kosovo, and Slobodan Milosevich for the Europeans, expects someday to be "President of the World." I wonder if his wife, "Big Sister" Clinton will be or has been invited to participate in Bilderberg "open and frank" secret meetings.

First an excerpt from U.S. Economy Unexpectedly Sheds 17,000 Jobs:

The economy lost 17,000 jobs in January, the Labor Department reported on Friday, the first monthly decline in four years and the most striking evidence yet that the United States may be slipping into a recession.

Until now, the labor market had been growing at a steady if softening pace. Many economists pointed to expanding payrolls as the final holdout in a sluggish economy weighed down by trouble on Wall Street, the collapse of the housing bubble, and a cascade of credit problems linked to soured subprime mortgages.

But the January employment report cast the job market in a startlingly darker light. Jobs disappeared across a broad spectrum of professions, with the steepest losses coming in the manufacturing, construction and goods-producing industries.

While jobs are now disappearing, it looks as if prices will continue to rise as China's inflation rises.

Soaring energy and raw material costs, a falling dollar and new business rules here are forcing Chinese factories to increase the prices of their exports, according to analysts and Western companies doing business here.

Because of new cost pressures here, American consumers could see prices increase by as much as 10 percent this year on specific products -- including toys, clothing, footwear and other consumer goods.

But my favorite corporate glutton--aside from telecommunications, pharmaceuticals, insurance, the Federal government, and doctors and lawyers as a whole--the oil industry has once again managed record profits even as everything else crumbles, partially due to increased transportation and material cost.

Exxon Mobil delivered its strongest performance ever last year, earning a record $40.6 billion in net income because of surging oil prices, the company said Friday.

That is surging oil prices that they bid up even as they pump the oil and at the same time refuse to invest in refineries or infrastructure. Oh, well, no recession for the wicked.

From the article Senate Democrats adding to stimulus:

Senate Democrats will move to add to a $150 billion economic stimulus package rebates for senior citizens living off Social Security and an extension of unemployment benefits, setting up a clash with the White House and House leaders who are pushing a narrower package.
...
The president and House leaders agreed last week on a proposal to provide rebates to 117 million families and to give businesses $50 billion in incentives to invest in new plants and equipment. The goal is to help head off a recession and boost consumer confidence.

But Senate Majority Leader Harry Reid, D-Nev., quickly said the Senate would consider adding to that plan, including extending unemployment benefits, boosting home heating subsidies, raising food stamp benefits and approving money for public works projects.

Ah, Congress works in mysterious ways...every opportunity is seized (hey, an exception to the i before e except after c rule--a teachable moment) to put back what the 1990's took away. And though I am just a poor boy from a poor family--means I might actually qualify for those food stamps in this economy, but I won't partake--I won't get much more than the $300 for my teenage son (That will be about three weeks of groceries with his metabolism.), since I am not in the income bracket that would buy a "consumer good" such as a flat screen TV or invest in propping up the one legged stock market. Actually, I suppose some people might use the checks to pay off some of that credit card interest and never buy goods with it.

Plus, I really can't wait until June--or August or September after the tinkering--as the kid wants to eat right now.

Jerome Kerviel, the rogue trader blamed by Société Générale for massive fraud, was taken into custody in France.

If he had really been a supercriminal, I would have thought he would have a couple new identities and left for some fun in St. Kitts.

From Biggest Drop in Existing Home Sales in 25 Years in the New York Times:
Sales of existing homes fell in December, closing out a horrible year for housing in which sales of single-family homes plunged by the largest amount in 25 years. The median home price dropped for the entire year, the first time that has occurred in four decades.

The National Association of Realtors reported that sales of single-family homes and condominiums dropped by 2.2 percent in December to a seasonally adjusted annual rate of 4.89 million units.

For the year, sales of single-family homes were down by 13 percent, the biggest drop since a 17.7 percent plunge in 1982. The median price for a single-family home dropped 1.8 percent to $217,000.

That was the first annual price decline on records going back to 1968. Lawrence Yun, the Realtors' chief economist, said it was likely that the country has not experienced a decline in housing prices for an entire year since the Great Depression of the 1930s.

That 40 acres and a mule in Missouri is looking better every day...grow some tomatoes, sweet corn, milk the cow, gather eggs, just like my grandfather did 75 years ago.

When we crash, everybody follows. Proof that we still wield the most impact on the whole world.

From the L.A. Times (also suffering from its own little meltdown as the Tribune monkeys with it).

Stock markets worldwide on Monday suffered one of their worst routs since the 2001 terrorist attacks on growing fears that U.S. economic woes could turn global boom times to bust.

Foreign markets, most of which had been sliding in recent weeks along with U.S. shares, faced a barrage of selling that left many of them down more than 5% for the day, and some down as much as 8%.

The German market dived 7.2% -- the equivalent of the U.S. Dow Jones industrial average plummeting 871 points. Stocks sank 5.5% in Hong Kong, 7.4% in India and 6.6% in Brazil.
...
"The U.S.' problems are stretching out globally," said Alan Ruskin, chief international strategist at investment firm RBS Greenwich Capital in Greenwich, Conn. "Clearly these markets are very vulnerable, plainly nervous -- and uncertainty rules."

In Business excerpt:
The developer of Lake Las Vegas, Transcontinental Corp., in Henderson is in default on a $560 million loan and has until the end of the year to find buyers for its remaining undeveloped land or the development could face foreclosure, a Lake Las Vegas official said.

A group headed by investment banker Credit Suisse has, for now, waived any default obligations, after Lake Las Vegas, the lake resort community did not meet its debt obligation on a sales volume quota by Sept. 30,

Housing foreclosures, projects abandoned, Lake Las Vegas in default, Cosmopolitan in default, and the new Town Center looks to be a giant "white elephant;" will anyone doubt that the recession is already here?

An excerpt from Merrill Loses $10 B;

Merrill Lynch (MER), the world's largest brokerage, lost nearly $10 billion in the last three months of 2007, its biggest quarterly loss since it was founded 94 years ago, after writing down $14.6 billion of investments slammed by the ongoing credit crisis.

Merrill became the third of the five biggest Wall Street investment banks to post a loss for the quarter after taking massive write-offs related to the shrinking value of securities backed by mortgages that have soured as borrowers have been unable to make payments on time.

Just seems to prove Zounds's Law; Most people are paid an amount of money directly proportional to the amount of damage they can do. Overpaid Wall Street "Wizards" have cost billions; minimum wage earners eat the damage in the form of costly bailouts which deflate the dollar and increase the cost of living.

State of our country;
Going down...down, down, down, down!

Here's an excerpt from Citigroup Loses $9.8 Billion; Will Cut Jobs:

Citigroup announced a steep cut in its stock dividend and another big investment by foreign investors on Tuesday after taking more write-downs related to subprime securities and posting a $9.83 billion loss for the fourth quarter.

Beginning what is expected to be a grim week for financial company earnings, Citigroup said it was writing down $22.2 billion because of soured mortgage-related investments and bad loans. The bank is also cutting its dividend by 41 percent and obtaining a $12.5 billion cash infusion to strengthen its balance sheet, including big investments by its former chairman, Sanford I. Weill, and the Government of Singapore Investment Corporation.

Facing rising expenses and deepening losses, Citigroup is expected to embark on a major cost-cutting campaign that could result in at least 4,000 layoffs. And thousands more could be in the offing in the coming months.

Housing starts are the lowest since 1992.

And the country still seems to be run by drunken frat boys with M.B.A.'s who have been running a financial con game on the whole country knowing that the Federal Reserve was designed to facilitate the elimination of small businesses. And today we have basically the same crop of corrupt and inept politician's running for office--who in this country wants to be President with a depression coming except those simply hungry to have lunch with the lobbyists?

The Consumer Price Index was at the root of the market's weakness for Friday as total CPI and core-CPI, which excludes food and energy, were higher than expected for November. Apparently, inflation woes worry investors that the Federal reserve won't lower rates any farther.

What the Fed has done as reported by the L.A. Times as "an act of global economic cooperation ...[is announce] an agreement with four foreign central banks to create a new method for injecting billions of dollars into the world's financial system to break up a potentially crippling logjam in credit.

The Fed said that it would lend at least $40 billion to cash-strapped U.S. banks starting next week and could supply considerably more. In addition, it will temporarily make $24 billion available to the European Central Bank and the Swiss National Bank to help meet demand for dollars in Europe.

By acting in conjunction with those institutions, as well as the Canadian and British central banks, the Fed is seeking to alleviate a problem that could hurt the United States as it struggles to avoid slipping into recession. "

Hey, what's a few more billion dollars pumped out to devalue the dollar--I mean alleviate the credit crunch and save world financial institutions? Now that everyone else's money is worth more, we might see some of the wholesale buying of U.S. property that we saw with Japanese investors in the 1980's. From housing bubble to commercial bubble, what will the "experts" at the Fed think of next? How about calling a recession a recession? Or how about bailouts as bailouts for only the big financial institutions? When will the big institutions really pay the price of bad management? Not while there is a Federal Reserve, period.

The National Association of Realtors reported that sales of existing single-family homes and condominiums dropped by 1.2 percent last month to a seasonally adjusted annual rate of 4.97 million units.

The median price of a home sold last month declined to $207,800, a drop of 5.1 percent from a year ago, the biggest year-over-year price decline on record.

Bear Stearns Cos., the nation's fifth-largest investment bank and one of the hardest hit by bad loans, announced it will cut 4 percent of its staff in further fallout from the summer's mortgage debacle.

Locally, Nevada continues to lead the the nation in home foreclosure rate

Amid all this is it surprising that the New York-based Conference Board said this week that its Consumer Confidence Index dropped to 87.3, marking a four-month slide and continuing down almost 8 points from the revised 95.2 in October?

And the job picture in Clark County is...
Hot Jobs from LasVegasNow:
Front Desk Clerk (Palms Place)
Bell Person (Palms Place)
Beverage Manager (Palms Place)
Bartender (Palms Place)
Food Server (Palms Place)
Retail Manager (Palms Place)
Retail Clerk (Palms Place)
Housekeeping Manager (Palms Place)
Condo Housekeeper (Palms Place)

If these are the top jobs in Las Vegas and Clark County then there is no need for colleges in Nevada and we can eliminate the Nevada System of Higher education, formerly the University and Community College System of Nevada before the name change in 2004,--hmmm...when something is failing, like CCSN (Community College of Southern Nevada), a name change seems to be the answer--completely as part of Governor Gibbons's budget cuts.

Plus, if these are the top picks, what is left at the bottom? ...cigarette butt picker-upper and crazed, obsessive, alien news reporter--oh wait, one has already been filled.
Are UFOs Coming to Nevada? by George Knapp
Cattle Mutilations by George Knapp

In the wake of the subprime loan debacle, with the value of the U.S. dollar plummeting as against the euro, OPEC members are talking about converting their cash reserves to the euro and away from the U.S. dollar.

Comments about the U.S. currency came during a weekend summit where the heads of state of the Organization of Petroleum Exporting Countries sought to find ways to mitigate the adverse effects of a weak dollar on revenues.

Oil is priced in U.S. dollars and the currency's depreciation has contributed to rising crude prices and eroded the value of national dollar reserves. Cartel officials have resisted pressure to increase oil production to ease prices.

The fallout from the "financial wizardry" of our lending institutions is now seen throughout the economy with layoffs in the construction industry, loss of revenue from lack of sales of construction materials, a devalued dollar, soaring inflation--if you put the "volitiles" like energy and food back into the equation, and a perfect opportunity for the rest of the world to pile on and crash our economy. OPEC can convert dollars to euros; the Chinese can also with the huge trade imbalance we have with them, further devalueing the dollar as countries compete to unload dollars for a finite number of euros--again basic economics.

My last comment is for the ordinary citizen: you voted the bozos into office--both Republican and Democrats--you spent more time thinking about which SUV to buy than which candidate to vote for, and apparently are more interested in O.J. Simpson and Brittney Spears meltdowns than how your Congress is working. Enjoy the recession...you've earned it!

Citigroup, which announced Prince's resignation on Sunday, had said it may write off $11 billion of subprime mortgage losses, on top of a $6.5 billion write-down already reported last month.

Robert Rubin, a former Goldman Sachs partner and U.S. Treasury secretary who chaired Citigroup's executive committee, was named chairman, after Chairman and Chief Executive Charles "Chuck" Prince quit.

The L.A. Times reports that the write-off underscores the fact that, almost a year into the sub-prime crisis, the brightest minds on Wall Street still are unable to get a handle on their companies' financial exposure.

Earlier, Merrill Lynch & Co ousted Chief Executive Stanley O'Neal following a $8.4 billion write-down that was more than 50 percent higher than the investment bank had forecast.

So the "brightest" minds are unable to get a handle on this? This just proves what I saw some years ago on college campuses; the two easiest disciplines for receiving a degree were in education and business. I remember dozens of business majors as frat boys who measured success by the number of kegs consumed and the ensuing vomiting. So, perhaps these are the "brightest" minds now in charge. No wonder we have problems; they missed the classes on responsible lending. Of course, I am just whining because I didn't take those easy courses and go into a business where I could run a company into billion dollar losses and "retire" with hundreds of millions of dollars in compensation. Luckily, I am not one of the Nevadans facing foreclosure in the foreclosure capital of the U.S. who "benefitted" from those "brightest" minds.

Business Press reports southern Nevada office vacancies reached 12.24 percent in the third quarter amid a housing market downturn, acording to Applied Analysis, a Las Vegas-based economic research firm. The Las Vegas valley had 44.1 million square feet of office space at the end of September, and despite two million square feet worth of absorption for the year-to-date, vacancies still increased by 2.2 percent in the third quarter over last year.

Oh well...we have gotten used to seeing buildings implode here in the valley; now we get to see a whole market give it a try. And while we have these big casino projects being built, the gambling money is now going to Macau, which is using sports stars like tennis' Roger Federer and basketball's LeBron James to outstrip the Vegas Strip. Once the fire starts, we won't even have the water to put it out, but nothing is "wrong" in the valley except prostitution isn't legal according to Oscar.

A barrel of crude oil hit a new all-time high of $85.92, the energy sector now up 0.9 percent, while the Dow is sinking like an anchor.

What I wonder is how much the billions of dollars donated by the Federal Reserve to "poor" companies like Bear Stearns, Goldman Sachs, etc., which resulted in a devaluation of the dollar and saving the big boys while smaller mortgage companies folded and lost jobs, have contributed to the rise in oil prices.

We are under assault by a few corporations bent on world domination--there are only approximately eight oil companies really pumping and buying the oil, four or five pharmaceutical companies, four of five major financial institutions, four or five communication companies, the U.S. Supreme Court has recently struck down a long standing anti-trust ruling precedent, our politicians stuff their pockets with kickbacks and bribes, and the general population watches American Idol, Entertainment Tonight, and ESPN. Compare the fall of the Roman Empire concurrent with Colliseum events and the hiring of mercenaries to hold the empire together and the correlations with our own society are eerie and depressing.

In a response to Senator Lieberman's request for an analysis of the impact on the U.S. if the Climate Stewardship and Innovation Act of 2007 (bill S. 280) were to be passed the E.P.A. wrote the following:
...emmissions under S. 280 would be approximately 1-3 percent lower than 2000 levels in 2030 and 1-5 percent lower than 1990 levels in 2050.
...reductions in Gross Domestic Product would range between 1.1 percent and 3.2 percent. (If enabling technologies are widely available.)
...gasoline prices would increase $0.68 per gallon and electricity by 25 percent by 2050. (That would only be the cost of the bill--not other factors that might lead to $10-20 a gallon gasoline prices.)

The E.P.A. analysis does not try to calculate the cost to the U.S. if higher operating costs cause these business to move overseas nor the cost environmentally if they move to countries with little or no environmental protections at all. In another letter to Senator Spector the E.P.A. reports that Bingaman-Specter (S. 1766) requires a smaller percentage reduction of emissions in covered sectors, but since S. 1766 has broader coverage than S. 280, the total abatement achieved by both bills is similar.

According to the Commerce Department sales of new homes dropped by 8.3 percent in August from July to a seasonally adjusted annual rate of 795,000 homes, the lowest level since June 2000.

With the credit problems, the sub-prime lending fiasco, loss of jobs in the construction market, plummeting value of the dollar fueled by a bailout of the largest financial institutions coupled with a seemingly reckless half point drop by the Federal Reserve which seems designed only to bolster the stock market, record crude oil prices, and a plethora of presidential candidates already bought by special interests, 2008 looks like a good year for a recession. It also looks like a good year for Democrats to win the White House. They don't fix recessions; they ride them out and then take credit, but that's just good politics.

From WTOP.com; Treasury Secretary Henry Paulson told Congress on Wednesday that the federal government will hit the current debt ceiling on Oct. 1.

The current debt limit is $8.965 trillion. Unless Congress votes to raise that ceiling, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due.

The Senate Finance Committee earlier this month approved increasing the limit on the national debt to $9.82 trillion.

That is about $30,000 per person already, so what is another $850,000,000,000 or $2,900 per person?

Forbes is reporting on a quarterly report out of the University of California says the US economy, while not technically in a recession, is having a 'near recession experience.'

The UCLA study released today predicts real US economic growth will be just above 1 pct in the last quarter of this year and the first quarter of 2008, and says the deterioration of the housing market is to blame.
....
The forecast predicts the US economy will return to a 3 pct growth rate by 2009, and that the Fed will cut the federal funds rate to 4 pct by the end of this year, more than a full percentage point lower than the current 5.25 pct.

But in other news today the dollar fell to an all-time low against the euro today and oil prices surged to a record, suggesting that a weaker American economy will be accompanied by higher prices for energy and other imported goods.

Early this afternoon one euro was trading at $1.391, up from $1.384 on Tuesday evening; the euro is up 5.4 percent against the dollar so far this year and about 1 percent so far this week. Crude oil prices were up 2.2 percent, to $79.91 a barrel

Home market crash, credit crash, rising oil prices, rising product prices, and poisoned toys from China. If we don't see a recession, it's still going to be tough Christmas season.

OpinionJournal.com is reporting the forces of the status quo at the World Bank now have another target in their destructive sights since getting rid of Paul Wolfowitz: The corruption fighters at the bank's Department of Institutional Integrity

OJ reported at the time that the fight over Mr. Wolfowitz had little to do with his girlfriend and everything to do with his anti-corruption efforts.

The controversy began with a 2005 report by the bank's Institutional Integrity unit into pharmaceutical drug procurement as part of the bank's Reproductive and Child Health I Project in India (or RCH I). The 16-page report was never been made public but OJ has included a link so that readers can see the whole report.

The key quote from the executive summary: "Evidence summarized below indicates that RCH I was subject to systemic fraud and corruption through i) bribery of Procurement Support Agencies (PSAs) and government officials; ii) falsification of performance certificates; iii) collusion among bidders; and iv) coercion of companies by cartel members and PSA officials."

The report cites "substantial losses" into the tens of millions of dollars or more, as well as evidence of corruption risk at other health care projects in India "representing over US$2 billion in Bank funding." It concludes that the findings are "sufficiently grave" to merit sanctions against specific individuals and companies.

Mr. Wolfowitz was thus presented with a plan for the bank to finance phase two of the RCH project without so much as a mention that there had been problems in RCH I. When he learned of the corruption findings in mid-2005, however, Mr. Wolfowitz decided to suspend further bank lending to that India project until the matter was cleared up.

After India's government committed to cleaning things up, Mr. Wolfowitz lifted his suspension and in August 2006 the bank decided to fund stage two and other health projects, to the tune of $672 million. But only a year later, this past July, did the bank get around to debarring two of the offending Indian companies, Nestor Pharmaceuticals Ltd. and Pure Pharma Ltd., from bank contracts--and then only for three years and one year respectively.

It's pretty clear that the amount of profit {theft} that is available in the world markets must make International bankers drool in their villas. After the scandals in the United Nations, including the oil for food policies, the thought of one world government, one world bank, and the few who would enslave the rest of the world makes me just a bit paranoid--or a lot!

So what do people in some of the major countries think about globalization? Let's look at a recent Harris Poll conducted in July of 2007.
Globalization:
"Do you think Globalization is having a positive or negative effect in [your country]?"
Base: All EU adults in five countries and US adults
Great Britain France Italy Spain Germany United States
% % % % % %
Unweighted base 1040 1020 1084 1116 1046 1054

Positive effect 15 18 25 17 36 17
Negative effect 53 53 55 54 42 45
Not Sure 32 29 20 30 22 38
Note: Percentages may not add up to 100% due to rounding

And how about those corporate executives who make millions, cook the books so that they qualify for extra large {more millions} bonuses, while cutting jobs, health care, and product quality by buying Chinese. What do people think about the corporate executives?

"In your opinion, do senior executives in your country earn too much each year in salaries and bonuses, too little, or about the right amount?"

Great Britain France Italy Spain Germany United States
Too much 79 % 54% 74% 72% 79% 77%

In a letter to an associate President Franklin Roosevelt wrote in 1933: "The real truth of the matter is, as you and I both know, that a financial element in the large centers has owned the government since the days of Andrew Jackson." (pg. 4, The Shadows of Power by James Perloff) It is a logical step to then own all governments, control all lending, and manipulate all economies; but hey, what's a conspiracy theory or two among friends...or are we?

On Monday oil futures prices rose sharply in New York as fears receded about an economic crisis from the meltdown in the US subprime mortgage market as reported on Yahoo News.

New York's main oil futures contract, light sweet crude for delivery in October, advanced 88 cents to close at 71.97 dollars after briefly topping 72 dollars a barrel. That followed a rise of 1.26 dollars on Friday.

John Kilduff at MF Global said the worst fears about the impact of the credit squeeze have begun to ease.

But today all confidence seems to have evaporated as the stock market plunged as investors grew more uneasy about the economy and whether the Federal Reserve will take the steps needed to prevent credit market problems from spreading further. The Dow Jones industrials fell 280 points.

Financial services stocks were among the hardest hit during the session as investors reacted to not only economic reports that could affect the group, but a downgrade of several major players. Merrill Lynch analyst Guy Moszkowski cut ratings on Citigroup Inc., Lehman Brothers Holdings Inc., and Bear Stearns Cos. due to concerns about earnings.

Lehman Brothers Holdings Inc., the fourth-largest investment house, fell $3.47, or 6 percent, to $54.28. Bear Stearns, the fifth-largest investment bank, fell $3.78, or 3.4 percent, to $108.42. Citigroup Inc. fell $1.65, or 3.5 percent, to $46.14.

At the same time the S&P housing report pushed shares of homebuilders lower. It was reported that U.S. home prices fell 3.2 percent in the second quarter and when home prices fall, owners have a hard time refinancing, which can lead to more defaults and delinquencies.

All this means to me is that, one:
None of the so-called experts know what is going to happen day to day.
Two:
All of Wall Street wants someone else to bail them out of their poor performance--namely the Federal Reserve, which means the ordinary citizen will pay because the value of the dollar will fall again, causing rising prices, creating a need for more borrowing, creating more lending, creating more debt, creating more crisis--should I stop now?
Three:
Investors spend too much time following the herd and ignoring the facts.

A new model developed by a finance professor helps banks test the strength of their investments.

Tim Yeager, an associate professor of finance at the University of Arkansas and formerly an economist with the Federal Reserve Bank in St. Louis, is attempting to help banks avoid heavy losses in commercial real estate loans that can wipe out capital and cripple a bank's lending ability.

Yeager, also the holder of the Arkansas Bankers Association Chair in the Sam. M Walton College of Business, developed the model based on reports from northwest, northeast and central Arkansas banks.

The model can be applied to different lending categories and investments at individual banks to see what a shock would do to the overall financial stability of the bank.

After a couple centuries of banking in this country and leading banks having their pick of graduates of the "elite" schools such as Harvard, Yale, Stanford, etc. finally someone--and certainly not at an elitist institution--now is creating a model to show that when you make really bad loans, you really screw up your business. I have never used this little colloquialism but here comes...DUH!

San Diego-based Accredited Home Lenders Holding Co., which issued $15.77 billion in home loans last year, said it will cut about 1,600 of its 2,600 positions, close 65 branches, and stop accepting new mortgage applications in the United States as it struggles to stay upright.

Southern California is about 15 major earthquakes behind its quota for the past century, so the lending companies created their own disaster. Go S.C.

And another quake hit the New York area as Lehman Brothers Holdings Inc., the nation's fourth-largest investment bank, announced it is closing its subprime mortgage business, BNC Mortgage LLC, eliminating 1,200 workers at 23 offices.

Maybe these companies should eliminate a few CEO's who were perfectly aware that the lending market couldn't sustain the run; not one company could have created all these bad loans without the CEO's knowledge and/or encouragement. Get rid of one CEO and you can probably save 1200 jobs for what the CEO's pay themselves to have five homes and drink expensive wines and whiskey and run companies into the ground.

Dubai World, a holding company for the Persian Gulf state of Dubai, has invested $5 billion which gives it a piece of MGM Mirage and 50 percent of the 76-acre CityCenter complex under construction in the heart of the Strip. Dubai World's subsidiary, Dubai Ports World, was forced to sell its U.S. port operations after an uproar in Congress last year.

Dubai...isn't that where Haliburton has moved to?

Capital One Financial Corp. said Monday it will cut 1,900 jobs and close its wholesale mortgage banking business.

The company will close 31 GreenPoint locations in 19 states, after just acquiring them last December when it paid $13.2 billion for North Fork Bancorp Inc. For more go to Capital One slashes jobs, mortgage industry swoons.

Another financial coup by the wizards of high finance. Obviously, they majored in beer drinking during college and not sound investment. What I hope is that Capital stops sending me applications for credit cards every week. I would consider telling them to stop but I figure they would double their attempts just because I noticed the previous attempts. Along with HSBC, these credit card companies are wearing out my shredder. If every telemarketer, unsolicited mailer, and spammer went out of business, do you suppose unemployment would exceed ten percent? Hey companies, the only thing I can't seem to say no to is a good book. How about sending some free samples for reviewing?

In Yahoo News First Magnus Financial Corp. has laid off 99 percent of its nearly 6,000 employees nationwide and closed all of its more than 300 offices.

According to a notice filed with the state Friday, the Tucson-based company that originated home loans and then sold bundled loans into the secondary loan market expects to retain only about 60 of its employees.

First Magnus officials said a bankruptcy filing was possible.

Several mortgage companies down and more to come while the Federal Reserve bails out the big boys like Bear Stearns, involved in the subprime mortgage hedge fund investment crisis, and ordinary people lose their homes

Lately, I hear again that unions are complaining about Wal-Mart and its policies on employee health care. Just to let you know, this is an issue that has been around for quite some time.

Wal-Mart health care policy denounced by unions
March 1, 2006

In the second attack on Wal-Mart's polices in Massachusetts in a month, labor unions rallied on the Statehouse steps Tuesday afternoon to protest the alleged tax burdens Wal-Mart's healthcare policies place on state citizens by not providing adequate healthcare for its employees.

In a press conference following the rally, speakers said Wal-Mart's tax contribution to Massachusetts, which was $13.4 million in 2004, falls below what the speakers' consider an acceptable payment.

And:

The Wal-Mart Tax: A Review Of Studies Examing Employers' Health Care Cost-Shifting
March 31, 2005

As job-based health coverage declines and employers shift ever-growing
health costs onto employees, workers increasingly must turn to taxpayer-funded
programs like Medicaid to get health care for themselves and their families.
Meanwhile, Medicaid is wrestling with explosive cost growth, increasing 56
percent since 2000. Medicaid is the second largest expense for most states,
accounting for around 16 percent of state budgets, on average. States' spending
on the program is expected to grow almost 12 percent this year, four times faster
than the increase in states' general fund spending.

Overall health care costs, particularly for prescription drugs and hospital
care, are growing, so it is not surprising that Medicaid costs would rise too. What
sets Medicaid apart, however, is that increased enrollment in the program also
plays a decisive role in driving cost increases. A number of factors account for
growing caseloads, but one reason is that employers--including some that are
highly profitable--are shifting onto taxpayers the costs of insuring their workers.
Recent studies in 13 states have examined the extent to which employers'
workers utilize public health programs to secure health coverage for themselves
and their families. As the following summary of those analyses reflects, in each
one of these states, Wal-Mart ranks at or near the very top of the list of
employers that are shifting to the public the cost of providing health care
for their workers. In so doing, Wal-Mart is directly contributing to the nation's
Medicaid crisis.

That Wal-Mart should play such a prominent role in the Medicaid crisis is
unjustifiable by any measure. Wal-Mart rakes in profits at the rate of $20,000 per
minute; last year, its profits were $10 billion, the largest amount in its history.
The 2004 compensation package for Wal-Mart's CEO Lee Scott was almost $23
million. Five members of the Walton family who are major company stockholders
have a combined net worth exceeding $90 billion, making them half of the 10
wealthiest Americans. And over the last two decades, Wal-Mart has benefited
from at least $1 billion in economic development assistance from state and local
governments, including several states featured in this report

Just another corporation which has figured out how to play the system so they win and the public loses.

Las Vegas Sun reports Nevada's unemployment rate rose for the fourth consecutive month, hitting 4.9 percent in July as the housing slump continued and private-sector employers weren't able to provide a lot of temporary summer jobs.

The state Department of Employment, Training and Rehabilitation reported Friday that the seasonally adjusted rate was the highest since January 2004, and exceeded the national rate of 4.6 percent.

Everything that Las Vegas promised a few years ago has vanished. Jobs, affordable housing, water. The Las Vegas area has now made the top ten for least affordable housing in the country, only behind cities like Los Angeles, New York City, and Boston.

Market Watch reports Asian stocks dropped sharply Wednesday after Japanese banks, including Mitsubishi UFJ, reported losses from U.S. subprime mortgage defaults, with local concerns sending shares in Indonesia down nearly 9%.

Japan's Nikkei 225 index (JP:1804610: news, chart, profile) ended 2.2% lower at 16,475.61, its lowest closing level in 2007. The broader Topix index (JP:1804609: news, chart, profile) slid 2.6% to 1,594.15.
Shares of banking giants led the fall, with those of Mitsubishi UFJ (MTU9.12, -0.32, -3.4%) ending 5.3% lower, on reports that it incurred roughly five billion yen ($42.5 million) in appraisal losses as of July 31, on its portfolio of 280 billion yen in products linked to U.S. subprime loans.

Stocks in Indonesia tumbled the most within the region, with the Jakarta Composite Index slumping 8.8% to 2,043.58 in late afternoon trading.

Elsewhere in the region, Australia's S&P/ASX 200 ended 3% lower at 5,788, New Zealand's NZX 50 index lost 1.5% at 4,004.46 and Taiwan's Weighted index (XX:1805301: news, chart, profile) declined 3.9% to 8,568.22.

Singapore's Straits Times Index (XX:1815656: news, chart, profile) dropped 3.3% to 3,276.09, in afternoon trading.

South Korean and Indian markets were closed Wednesday for national holidays.

In yesterday's news from Smart Money, some of the largest firms in the $1.5 trillion hedge-fund industry have been hit this month by big losses among so-called quantitative funds, which use computer models to generate trading ideas.

The turmoil reached "historical" proportions last week, according to one hedge-fund executive, but now many of these same firms are saying there's money to be made when dislocated markets recover.

Goldman Sachs (GS) , an investment bank that's also the second-biggest hedge-fund firm, said its $9 billion Global Alpha quant fund is down 27% so far this year, with more than half of those losses coming last week.

Another $3.6 billion Goldman quant fund, called the Global Equity Opportunities fund, lost more than 30% last week. A third known as the North American Equity Opportunities fund has also lost money recently.

I guess what computer models don't predict is what happens to the markets when greed and "cowboy" risk management pollute the model. The managers of these funds are supposed to be the "brightest" of our financial wizards and look what they can do, make bad decisions, ride the wave of optimism--because if they don't, another will and who wants to see profits go to another firm, and wait for the Federal Reserve to pump 90 or 100 billion dollars into the problem so only the American people lose.

For a look at the same situation, only involving tech stocks of the 1990's, try reading Blood on the Streets by Charles Gasparino, which chronicles how market analysts overated tech stocks so that they could keep the market rising, thereby insuring increasing profits for their firms. Guess who suffered from that crash? Today the same craziness helped fuel an unsustainable housing bubble just so money could be made during a rising market. Sometimes I think the financial world has a shorter attention span than five year olds, and five year olds probably have a better grasp of the concept: What goes up must come down.

According to the Greater Las Vegas Association of Realtors, the median price of single family home dropped by $10,000 in one month.

The median price in July was $295,000 as compared to $305,000 in June and there are a record number of homes for sale.

Also, prospective buyers bid for nearly 100 homes and condominiums when the largest single home foreclosure auction in Las Vegas history took place this past Sunday.

Just might mean another drop during the month of August.

From ABC News Wall Street fell sharply again Thursday after a French bank said it was freezing three securities funds that struggled to find liquidity in the U.S. subprime mortgage market. The Dow Jones industrials were once more down by triple digits.

The announcement by BNP Paribas raised the specter of a widening impact of U.S. credit market problems. The idea that anyone institutions, investors, companies, individuals can't get money when they need it unnerved a stock market that has suffered through weeks of intense volatility triggered by concerns about available credit and bad subprime mortgages.

A move by the European Central Bank to provide more cash to money markets perhaps intensified Wall Street's angst. Although the bank's loan of more than $130 billion in overnight funds to banks at a bargain rate of 4 percent was intended to calm investors, Wall Street saw the step as confirmation of the credit markets' problems.

The Federal Reserve followed suit, adding $12 billion to U.S. markets to help ease liquidity constraints, according to Dow Jones Newswires.

Anyone want to guess where that $12 billion comes from? The Federal Reserve, which is not a government agency, doesn't have 12 billion in cash handy; it just makes believe it has money and hopes that the loan gets paid back while this imaginary money is insured by our government if it doesn't; then it comes out of our pockets. Adding billions of "new" money into the mix is why we have inflation which is really a devaluation of the dollar as there are suddenly more of them. So companies which made bad decisions are allowed to continue, thereby protecting the wealthiest citizens and big investors, and we get higher prices. Hopefully, with Europe also dumping billions in "new" money, the Euro won't rise any higher as against the dollar. One might think that a lower dollar might make U.S. products more attractive for export, but we don't make much of anything anymore, and a lower dollar affects trading in currency, which is a bit more complicated than this little tirade has space for. Just remember, bankers rule the world, not politicians.

American Home Mortgage Corp. filed for bankruptcy protection on Monday, the latest casualty of a mortgage industry that has plunged into distress.

The New York-based real estate investment trust, one of the largest independent U.S. home loan providers, filed for protection from creditors with the U.S. Bankruptcy Court in Delaware.

The filing came after American Home closed most operations on Friday, laying off all but about 750 workers. The company started the year with more than 7,400 employees.

Another casualty in the home loan market is Bear Stearns Cos co-president and co-chief operating officer Warren Spector, who resigned on Sunday, amid a credit risk crisis at the investment bank. (Yahoo News)

Bear Stearns said that, effective immediately, Alan Schwartz has been named the company's sole president.

Spector's departure follows Bear Stearns' assertion on Friday that it is weathering the worst storm in financial markets in more than 20 years after a major rating company warned mortgage credit problems could hurt the investment bank's profits.

Standard & Poor's warned that the recent collapse of two Bear Stearns-managed mortgage funds could hurt the company's performance and reputation for an extended period.

The collapse of the funds triggered a downturn across credit markets, put a damper on corporate buyout financing and sparked fears about Wall Street's trading and banking profits.

One day you're up and the next day you're out. At one time Spector was regarded as a possible successor to Chairman and Chief Executive James Cayne and now he probably just has a measly multi-million dollar parachute package to console him in his fall from grace. But just think, if this credit crisis gets bad enough, our government might just step in and bail out the "big boys" like it has for Lockheed (1970), First Pennsylvania Bank (1980), Penn Central Railroad (1970), Chrysler (1978), Continental Illinois (1984), and even New York City in 1975; because we wouldn't want corporate officers to suffer just because they don't know how to manage a company, unlike small business owners who don't donate tens of thousands of dollars to our "two party" system.

Nevada merchants sold $4.11 billion in goods during May for a 3.6 percent decline compared with the same month a year earlier, according to a Nevada Department of Taxation report.

But according to Gov. Jim Gibbons consumer spending remains strong in several business categories, helping the state maintain its "sound" economic footing.

The Taxation Department report shows that vehicle and auto part sales were down 14 percent in May while building material sales were down nearly 29 percent and restaurant-bar sales--indicators of tourist traffic--were down about 16 percent.

Clothing store sales were up nearly 32 percent, amusement-gambling-recreation industry sales were up 35 percent, and food and beverage store sales were up nearly 26 percent.

Compared to the Economic Forum's May 1, 2007 projections, fiscal year to date cigarette taxes are 2.35% or $2.7 million below projections. The liquor tax is 7.21% or $2.8 million above projections.

Well I know the prices in my local grocery store went up 26 percent, so I am not sure anybody is selling more, just charging more. It's enough to make me want to drown my checkbook in a six-pack of cheap beer--which may be why liquor sales are up while foreclosures rise. That doesn't sound like a strong economy to me, and with the housing woes and high energy costs, if there is an attendant drop in tourism (which really fuels the economy), then Governor Gibbons can eat his words--at least he can afford them.

From Yahoo News: Shares of American Home Mortgage Investment Corp. plunged 90 percent Tuesday after the company raised fears it may become insolvent, renewing concern about worsening credit quality in the mortgage market and killing a Wall Street rally.

The struggling mortgage lender said its financial backers have essentially pulled the plug. The Wall Street banks that lend American Home Mortgage money for home loans -- which include firms like UBS AG, Bear Stearns Cos., and JPMorgan Chase & Co. -- will not extend the company any more money, and some have demanded back the money they have lent.

And about our neighbors in California, the source of Las Vegas' housing woes...this article called Golden dream or foreclosures by the sea?a>