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7041-7060 of 8312
...in short: spike! and then: sell on news.
What ever happens tonight will set the tone for the rest of this month.
Quotes:
BT News / BloomBerg News
Fed looks for more measures to increase credit
The Fed may lower the discount rate - what it charges banks for short-term direct loans - by a quarter-point more than the benchmark rate after vice-chairman Donald Kohn and San Francisco Fed president Janet Yellen publicly expressed frustration that previous rate cuts have not encouraged banks to lend to one another.
Such a move would narrow the gap between the two rates - normally one percentage point - to a quarter-point. Economists said that may spur lending by easing the stigma of borrowing at the discount rate, letting firms claim that they are taking advantage of a better deal.
'The Fed has to re-liquefy the markets to reduce the risk of a financial accident,' said Lou Crandall, who used to work at the New York Fed and is now chief economist at Wrightson ICAP LLC, a Jersey City, New Jersey-based research firm that focuses on government debt.
Policymakers are struggling to contain a crisis of confidence among banks that sent the cost of three-month loans between lenders to the highest in seven years. Failure to head off a credit crunch may send the economy into its first recession since 2001, economists said. Mr Crandall predicted that the Fed will lower the discount rate by half a point, to 4.5 per cent, and the main federal funds rate target by a quarter point to 4.25 per cent when it meets on Dec 11.
Futures prices indicate a 50-50 chance of a half point move in the federal funds rate next week. -- Bloomberg
(WASHINGTON) Federal Reserve officials, who are forecast to lower their main interest rate next week, are signalling that they are looking for additional ways to increase credit to companies and consumers.
Market Overview
| Market Diaries |
 |
| Issues: |
NYSE |
Nasdaq |
|
|
| Advancing |
2,523 |
2,171 |
|
|
| Declining |
670 |
826 |
|
|
| Unchanged |
70 |
99 |
|
|
| Total: |
3,263 |
3,096 |
|
|
| Issues at: |
|
|
| 52-Week High |
89 |
46 |
|
|
| 52-Week Low |
19 |
70 |
|
|
| Volume: |
|
|
| Advancing |
1,161,784,000 |
1,592,903,000 |
|
|
| Declining |
202,586,000 |
387,465,000 |
|
|
| Unchanged |
5,752,000 |
24,447,000 |
|
|
| Total: |
1,370,122,000 |
2,004,815,000 |
|
|
12/6/2007 7:13:00 PM |
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what i post below is for me and mani only, plz do not follow, kindly consoult ur financial advisers. thanks
actually we all know lah, just that we must post discreetly, keep it to our heart mah, else if we post too bullish and the market trade otherwise, we be cursed like pension. i areadi long warrent last week sold half yesterday and kept till this current resistance level. however it seem can still keep sti warrent till dow hit double top or so.
profitable week or 2, made quite abit to cover some bad trades i made recently.. lol
Anyway, the Dow chart looks promising... better things could be on the way ...
DOW hit 1st resistance... ard 13600-13700
This could be the last uptrend of the year 2007, and unknown for year 2008. Watch out when DJ reach 13780 to 13800, and it should be the end of the uptrend.
Stocks set to extend gains
Investors sustain upbeat mood as they await details of plan to aid homeowners.
NEW YORK (CNNMoney.com) -- U.S. stocks were poised to extend their
rally Thursday as investors were cheered by a plan to offer aid for
troubled homeowners and a continued slide in oil prices, while awaiting
sales reports from major retailers about the start of the holiday
shopping season.
At 7:42 a.m. ET, Nasdaq and S&P
futures were higher, pointing to a positive start for stocks.
Following article is courtesy of the WSJ. We are now experiencing highest delinquency rates since 1991:
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Surge in Auto-Loan Delinquencies Is Latest Trouble for the Economy
By JEFFREY MCCRACKEN and GREGORY ZUCKERMAN
December 6, 2007
First came housing loans and the subprime-mortgage crisis.
Now, signs of stress are creeping into another key consumer area: auto loans.
Delinquencies in the auto-loan market are ticking up to their highest level in several years. Lenders are tightening terms in some cases, and interest rates have risen from the rock-bottom levels of a few years ago. About $575 billion in loans for new and used cars are made annually, according to the National Automotive Finance Association.
About 4.5% of auto loans made in 2006 to top-rated borrowers were at least 30 days delinquent as of the end of September, up from 2.9% the previous month, according to a Lehman Brothers survey of companies servicing these loans. That is the biggest one-month jump in at least eight years. Lehman says 12% of subprime borrowers, who have poorer credit records, were delinquent on their 2006 auto loans as of September. That is the highest level since 2002 and up from 11.1% the previous month.
"The numbers will get worse for auto loans," says Dan Castro of GSC Group, a New York firm that runs debt-related investment funds. "We're starting to see signs of rising losses, and delinquencies are creeping up."
Few in the auto-loan industry see the strain as the kind of disaster-in-the-making that home mortgages have become. Still, there is a connection between the two categories, since the squeeze on some home borrowers may make it harder to carry car loans. The trouble signs in auto loans suggest that the credit woes could be spreading to the broader economy, a development that has been worrying investors and policy makers in Washington.
Other corners of the credit market are also sending troublesome signals. Shares of First Marblehead Corp., which packages student loans into securities, dropped to a two-year low yesterday after an analyst cut his rating on the stock and Moody's Investors Service threatened to downgrade some of its securities, also because of delinquency concerns.
Car loans differ from home loans in one crucial way. During 2004-06, many home loans were made to speculators on the assumption that the underlying asset -- the home -- was sure to keep rising in value. Many people, inspired by fervor in the market, took out home loans that in retrospect they had little hope of paying back.
By contrast, everyone understands that the car behind a car loan is an asset destined to lose value. The typical delinquent borrower in a car loan isn't a speculator but someone who became unable to make what previously seemed like a manageable payment. That is why car delinquencies are closely linked to the health of the economy.
"Auto-loan defaults tend to be event-driven, like a job loss or an unexpected health-care bill or a divorce," says Dan Berce, chief executive of AmeriCredit Corp., one of the country's largest subprime auto lenders. "We watch quite closely economic indicators like unemployment rate, weekly job claims or hours worked."
In the second quarter, borrowers were at least 30 days behind on 2.77% of all auto loans made by nonbank lenders, the main players in the market, according to the American Bankers Association. That was the highest delinquency rate since 1991.
Many auto loans undergo the same Wall Street financial engineering as the mortgage loans that stand at the center of the credit crisis, making this a potential issue for investors. Auto loans often are bundled together into securities, sliced and diced into pieces with varying levels of risk and return, and sold to investors around the world.
In 2006, $89 billion of auto loans were packaged into asset-backed securities and sold to investors, according to Standard & Poor's, making it the biggest asset class for such securities next to mortgages and credit cards. That tally doesn't include certain other types of securities backed by car loans. The market is now slowing. Deutsche Bank estimates such bundling was down to $69 billion during the first 11 months of this year, a 19% drop from the same period last year.
Borrower problems also could deal a blow to the already-struggling auto industry. Auto sales held up during the 2001 recession in part because lenders were able to offer easy borrowing terms. If lenders tighten terms in response to the delinquencies, it would make it harder for some people to buy cars.
U.S. auto sales are down about 2.5% this year, and the auto industry is bracing for sales to decline further in 2008. Interest rates on auto loans have increased to nearly 8% from about 6.5% in late 2004, according to J.D. Power & Associates.
The auto-loan-delinquency problem is somewhat less severe for two lenders associated with the top two U.S. car makers -- Ford Motor Co.'s Ford Credit, and GMAC Financial Services, which is 49%-owned by General Motors Corp. That is because Ford Credit and GMAC don't handle many subprime loans.
GMAC Treasurer David Walker said auto-loan delinquencies in the third quarter were the highest in at least three years, partly because of economic factors, but he said credit losses are still well within historical levels. Separately, GMAC is struggling with the fallout of the subprime-mortgage crisis because one of its units was a big home lender.
AmeriCredit, of Fort Worth, Texas, is also experiencing stress. The company makes about 500,000 new- and used-auto loans a year, valued at about $9 billion, some of which get sold to investors.
In the quarter ending Sept. 30, AmeriCredit reported net income of $61.8 million, down from $74.2 million for the period a year ago. It also lowered fiscal-2008 profit projections, blaming poorer-performing 2006 auto loans. AmeriCredit shares traded at $10.32 in 4 p.m. New York Stock Exchange composite trading yesterday, down 18 cents from the day before and 59% lower for the year to date.
There are reasons to believe the problems in auto loans won't reach crisis levels. Auto lenders and credit counselors say many consumers see their cars as a necessity and would sooner hand back the keys to a home and look for a rental than default on a car loan.
Auto lenders and dealers note that the monthly payment on a car is smaller than a mortgage payment. Most auto loans carry fixed interest rates, unlike subprime mortgages, which often reset to a higher rate after an introductory "teaser" period of two or three years.
Still, auto loans, like home loans, saw credit standards loosen in 2005 and 2006. CarMax Inc., of Richmond, Va., the largest used-car retailer in the country, said at the end of 2005 it lowered lending standards. For example, it allowed consumers to put down less money to buy more expensive vehicles. Car Max made about 140,000 car loans last year.
"We had been too strict and wanted to make more loans and maximize profitability. We expected our delinquencies and losses would go up, but they are up higher than we thought," said Katharine Kenny, head of investor relations at CarMax.
Some subprime auto lenders, such as Capital One Financial Corp., say they are seeing higher risks in parts of the country where home prices are falling the hardest, such as California and Florida. Lenders say rising delinquencies are also tied to higher fuel prices and slowing job growth.
Mr. Berce said rising delinquency rates prompted AmeriCredit to tighten its lending standards early this year and it will reassess the matter next month. It is now demanding that borrowers put down more cash against the value of the cars they are buying, especially among consumers with lower credit scores. Mr. Berce said this tightening of standards could reduce lending volume by about 10%.
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will this be another additional reason for heli Ben to do a 50 cut?
Positive indications are on. Do selective buying.
Positive indications are on. Do selective buying.
Fed hopes boost stocks
Wall Street surges on expectations that the central bank could lower borrowing rates by as much as a half-point when it meets next week.
So good or not? Keep cutting is not going to help the market in the long run.
Dow +165 pts...
up up and away... :>
at least hv a good start, hope end +ve.
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-10/32
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102 18/32
Yield:3.93%
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looks to be retreating slowly
Dow up 111 points now
Countrywide financail is the largest..if this go belly up..it can cos the dow to crash tremendously..the Bush admin want fianacial to hold reset of morgagte is very difficult to carry out..becos those cheap rate was given to entice ppl to take up loan with them in the first place...those financial inst cannot let the rate remain this low...they will suffer financially...just take one big boy to fail is enough to trigger the panic in the stock market..
Just read teletext just now...MAS said bank to suffer loses arising from subprime...this turmoil is far and wide...only come latest March then we will know whether US is in recession...but by any means..even the American said that they are already in recession...except fund rate cut expection...there are current no fudamental reason to stay in the market...the risk is greater than the benefit...good luck
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