Listen to this

My good friend Kevin sent me this link today and I have to say, it's good. I am a huge fan of the radio show "This American Life" on NPR and this one is exceptionally good. It summarizes the current problem with the "Credit Crunch", it's origins and it's extent. I highly recommend you listen to it.
http://www.thislife.org/Radio_Episode.aspx?episode=355
Scroll down and to the left of the story itself click on "Full Episode".


Enjoy

NASDAQ glitch creates chaos after hours

... and no real news on this yet. GOOG shares showed as low as $25 for a few seconds during which some orders actually triggered due to a NASDAQ glitch. RIDICULOUS!! Quote: NASDAQ MarketWatch is investigating potentially erroneous transactions involving the security Google Inc Cl - A "GOOG" executed after 15:57:00 today. MarketWatch will advise with details as soon as available. Participants should review their trading activity for potentially erroneous trades and request adjudication through the Clearly Erroneous process within the applicable timeframe for filing pursuant to the rule. Save Time on Clearly Erroneous Filings! NASDAQ's Reg Recon (http://www.nasdaqtrader.com/Trader.aspx?id=RegRecon) allows you to quickly and easily view and file trades that qualify as potentially erroneous. No more chasing trades and manually completing the filing forms. Reg Recon pre-populates the form for trades sent to NASDAQ MarketWatch for review. Let the lawsuites begin

Time to get back into Tech?

Google traded below $400 for the first time in years yesterday and Apple lost $20 BILLION!!!! in market share in one day falling some 18%. Why you ask? Well, no good reason. Everything took a huge beating. Today we're getting a bounce back from those lows. So is it time to get back into Tech at these prices? It just might be. Remember after 9/11 ? If you don't, help yourself to a nice heap of charts from finance.google.com and check what happened at and after 9/11. I remember most of you calling me months later and the discussion went something like: "Dammit man, anything we would have bought would have doubled by now, ...". Well as Warren Buffet said best:

"We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful."

Well others are fearful today. Everyone has run for the exits leaving great companies to be picked up at bargain prices. I'm not saying start buying today, but what I am saying, is when you see a real sign of recovery, have your money ready to jump back in. Which reminds me of another great Buffet quote:

"Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well."

Epic Fail!

I wish you all had had the chance to watch C-SPAN or CNBC or CNN earlier today. It was about the scariest thing I have ever seen. A live vote count on the most important vote the congress has faced in my lifetime and perhaps in it's own. The vote counts ticked up and on the yeas and nays as the world watched on TV. Things started out looking good for the Yeas but the Nays caught up quickly. The bill was rejected 228-205 to everyone's surprise. The Dow immediately fell over 600 points and the bottom gave out. Everything pretty much went to hell in a hand basket within minutes. NASDAQ took a huge hit with stocks taking more than 10% losses. Later in the day (Right now) Roy Blunt and John The Douchbag Boehner blamed the entire failure of the bill of house speaker Nancy Pelosi for her bi-partisan language. What freaking losers. Unreal. The republicans voted against this in much greater numbers and then they blamed the rejection of the bill all on Democrats. And then that two faced change monger Obama used the whole thing as a press op to make another speech. I think he'd forgotten that he's not the president yet. Anyway folks, looks like it's back to the drawing board. I just hope it's not too late yet.

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You can find the blog on http://dollarone.blogspot.com/

Is your bank safe?

So amid all the chaos the past few weeks I'm sure some of you are wondering if you should be worried about your bank. Lucky for you, there is now and online application that allows you to find out what your bank's rating is and whether or not you should be worried about your money. Just point your browser to http://www.bankrate.com/cnbc/safesound/ss_home.asp and search for your bank. 3-Stars is not that bad so don't panic when you see that, but anything below a 3 is probably cause for concern and requires more research. Good luck.

Wamu down many to go

Washington Mutual was closed by the U.S. government in by far the largest failure of a U.S. bank, and its banking assets were sold to JPMorgan Chase for $1.9 billion.

Washington Mutual, the largest U.S. savings and loan, was closed by the federal Office of Thrift Supervision, and the Federal Deposit Insurance Corp was named receiver. Customers should expect business as usual on Friday, the FDIC said.

"With insufficient liquidity to meet its obligations, WaMu was in an unsafe and unsound condition to transact business," the OTS said.

This wasn't the first, and I assure you, it won't be the last.

See more stories at http://dollarone.blogspot.com/

Run for the exits

... OR if you like roller coasters buckle down for the ride of your life. Holy popcorn batman. Did you guys listen to the Senate Banking committee hearing with Paulson and Bernanke? I am sure you can find some great articles on it today but for god's sake. Politicians just suck. They know there is urgent need for about a trillion dollars of bad-dept buyout and they're trying to add all sorts of earmarks to it. Trouble is, when a credit squeeze happens, it's not like cancer, where it kills you like over 6 years, it's more like a heart attack, which kills you within 1 day. The effect is going to be immediate and widespread. If they keep dragging their feet and making statements like:

"What (Treasury Secretary Paulson) is saying here is, this program that they think is very important, we need it to get the economy out of the doldrums. But if it is going to nick (corporate executives ) of a couple of million of the many millions that they already have, they are going to boycott it. I hope they are not that selfish and unpatriotic." Rep. Frank

"What the Secretary put on the table is a proposal—we're examining that proposal. You can tell that a lot of people are not satisfied with the proposal... When you're going to [use] $700 billion, on top of other money, we want to know: "Will this do it? And what's the worse case scenario?" He didn't answer the questions because he didn't know." Sen. Shelby

"There has been a good deal of skepticism, certainly about a blank check on both sides of the aisle. So clearly, Secretary Paulson is going to have to modify his plan significantly. The good news is, they do seem open to changes. So I suggested two, just to protect the taxpayers." Sen. Schumer

I wasn't too worried until today. Now it seems to me that the house and the senate have no real intention of passing any sort of aid with any urgency. All the talk today was of the variety of: Well we've told the market we're going to help, so now that they now that they can relax and wait until we come up with something better. Give me a break. Let me put it to you this way, here is what we're dealing with. We're all in a very fast sports car that we bought we money we didn't have. The car is going very very fast. We just realized that we're headed for a brick wall and our brakes do not work. We have to engage the emergency brakes. At these speeds though, using the emergency brakes is going to damage the car considerably and we might still hit the wall kinda hard and damage our very expensive car. BUT, if we don't use the brakes at all, well, then we're going to hit that wall at full speed. But what I haven't told you, is that this particular brick wall is built at the edge of the grand canyon, and at these speeds we'll break right through that wall and fly off the edge and disintegrate at the bottom of the canyon. Trouble is, the house and senate think that this crash is going to end at the wall and they can just put in some money to buy a new car later and we're all not likely to die from a crash into the wall. I guess no one has told them about the canyon. No amount of money will fix anything once we break through the wall. Call your representative and scream at them.

Let me be clear. Even though the near trillion dollars is from tax payer money. It's not going to be wasted. It's going to buy bad debt at pennies on the dollar. That's a great deal for the taxpayer. They get to buy distressed loans at VERY low dollar prices. Warren Buffet is salivating at the mouth for this. I'm going to go find some xanax now.

See the blog on http://dollarone.blogspot.com/

Draft of the Treasury's Proposal for Toxic Debt

If you're going to try to guess how this bailout is going to turn out and how successful it might be, then you might want to read what the proposal actually is.

Here's a Draft of the Treasury's Proposal for Toxic Debt:

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY

TO PURCHASE MORTGAGE-RELATED ASSETS
Section 1. Short Title.
This Act may be cited as ____________________.
Sec. 2. Purchases of Mortgage-Related Assets.

(a) Authority to Purchase.--The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States.
(b) Necessary Actions.--The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:

(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;
(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;
(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;
(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and
(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.

Sec. 3. Considerations.
In exercising the authorities granted in this Act, the Secretary shall take into consideration means for--

(1) providing stability or preventing disruption to the financial markets or banking system; and
(2) protecting the taxpayer.

Sec. 4. Reports to Congress.
Within three months of the first exercise of the authority granted in section 2(a), and semiannually thereafter, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate with respect to the authorities exercised under this Act and the considerations required by section 3.

Sec. 5. Rights; Management; Sale of Mortgage-Related Assets.

(a) Exercise of Rights.--The Secretary may, at any time, exercise any rights received in connection with mortgage-related assets purchased under this Act.
(b) Management of Mortgage-Related Assets.--The Secretary shall have authority to manage mortgage-related assets purchased under this Act, including revenues and portfolio risks therefrom.
(c) Sale of Mortgage-Related Assets.--The Secretary may, at any time, upon terms and conditions and at prices determined by the Secretary, sell, or enter into securities loans, repurchase transactions or other financial transactions in regard to, any mortgage-related asset purchased under this Act.
(d) Application of Sunset to Mortgage-Related Assets.--The authority of the Secretary to hold any mortgage-related asset purchased under this Act before the termination date in section 9, or to purchase or fund the purchase of a mortgage-related asset under a commitment entered into before the termination date in section 9, is not subject to the provisions of section 9.

Sec. 6. Maximum Amount of Authorized Purchases.
The Secretary's authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time
Sec. 7. Funding.
For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.
Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
Sec. 9. Termination of Authority.
The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall terminate two years from the date of enactment of this Act.
Sec. 10. Increase in Statutory Limit on the Public Debt.
Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.
Sec. 11. Credit Reform.
The costs of purchases of mortgage-related assets made under section 2(a) of this Act shall be determined as provided under the Federal Credit Reform Act of 1990, as applicable.
Sec. 12. Definitions.
For purposes of this section, the following definitions shall apply:

(1) Mortgage-Related Assets.--The term "mortgage-related assets" means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008.
(2) Secretary.--The term "Secretary" means the Secretary of the Treasury.
(3) United States.--The term "United States" means the States, territories, and possessions of the United States and the District of Columbia.

--
http://dollarone.blogspot.com/

A new message from the treasury secretary

This is how I know the tech market will be up tomorrow

Oracle, the world's No. 3 software maker, posted stronger-than-expected quarterly profit as operating margins hit their highest level ever for the period, sending its shares up 6 percent in extended electronic trading.

The company also reported a 14 percent rise in sales of new software licenses and gave an outlook for the current quarter that matched expectations Thursday, reassuring investors who had feared that the weak economy would cause Oracle to miss.

The thing is, investors have been waiting on the sidelines to see if the turmoil in the market has leaked into other industries or not. Well, Oracle showed today that it hasn't really effected sales in the tech sector. So I think we'll get a good boost in tech at least in the early hours of tomorrow morning. I would be a buyer of LWSN and MSFT at these prices and as always the big GOOG.

Enough Said

My new bank

With all the turmoil in the banking system it's hard to say which bank is going to even be around tomorrow so I found a new bank that I feel pretty confident about and I recommend you all start using it too:

DollarOne

Wow, what a day in the market. Holy cow. I haven't seen such a disaster since June/July. I feel like someone punched me in the gut. It's been a while since I wrote one of these cause there really hasn't been any great trades. In fact the last dollarone update was on October of 2007. Okay so I've just been lazy. I've been shorting mostly and playing with the same stocks, mostly trading them within the week. But today is the first day in a while that I see some great buying ops out there. As always I think GOOG is a great buy for long term. But today I think that BIDU is an amazing deal at these prices. I also see Sprint (S) as a good opportunity to make 10% pretty quickly. I think there is still quite a bit of downside left in the banks and builders and real estate related industries. So if you have the stomach to short anything you might want to start researching.
As always you can find this blog on : http://dollarone.blogspot.com/
Oh, and I did find a great site which aside from having some ads gives some good insight: http://www.askstockguru.com/ . Hope you all are holding up well. Let me know if you have any tips.