GM is now selling 10% below its IPO price and is a loss for the US Treasury

GM is now selling 10% below its IPO price and is a loss for the US Treasury

The FED is flooding the world with American dollars by printing dollars instead of borrowing the money from world creditors. What the fed is doing is competing with China and Japan to keep the competition for treasuries high so that the interest rates are low. It is beginning to appear as though most of the buying is now the USA and very soon none of the treasuries will be bought by foreign governments at these rates. If that happens then there would likely be hyperinflation and the silver and gold speculators will be made right. Since these dollars are flowing into the USA they show up a profits as long as labor costs stay low. Essentially the borrowed money is spent by people with no work ethic and goes to the bottom line of corporate profits creating a feeling that things are getting better when in fact the debt burden is getting precarious. This is no different from how people spent themselves into debt and lived lavishly until they went bankrupt.

The problem is that this cash has created a stock market bubble and a commodities bubble. In spite of high oil prices Saudi Arabia's oil minister said on Sunday the kingdom has slashed output by 800,000 barrels per day in March. Speculators are taking commodities off the market now to making fortunes on the mark-ups.


.Johnson & Johnson was the top performer on the Dow, with shares rising more than 3.5%, after the company reported better-than-expected sales and earnings. Goldman Sucks profit was down 21% from reported a year ago after paying a $1.64 billion preferred dividend to Warren Buffett’s Berkshire Hathaway Inc for his loan that rescued them. Market-making revenue fell 30%. Revenue from commodities, currency and fixed-income trading fell 28%. Goldman also took a $220 million hit related to its assets at Litton Loan Servicing.

The FED continues to buy treasuries to keep interest rates low by printing money to cover deficit spending. This hides the cost of debt until such time as the EU settles its deficit problem and then the focus of the creditors turns to the USA.

Standard & Poors lowered the outlook on the United States' credit to "negative. The United States kept its AAA rating, but the downgrade means that S&P analysts believe there is at least a 33% chance that the agency will have to lower its credit rating on U.S. debt in the next two years. The report released Monday morning says that the United States has a large debt and deficit compared with other highly rated nations, and unlike with those other nations the path to addressing the debt and deficit is absent.

Citigroup Earnings Fell 32%
Moody's Investors Service revised its outlook of Sears Holdings Corp downward from positive to stable citing the retailer's stagnant revenue and narrowing profit margins.

World Markets:
China’s Foreign Ministry spokesman Hong Lei said Tuesday. "U.S. government debt is a reflection of the U.S. government's credit, and is an important investment product for institutional investors in the U.S. and internationally," he said. "We hope the U.S. government earnestly adopts responsible policies and measures to protect the interests of investors." Immediately GE/MSNBC/Pravda stopped covering the Obama deficit spending. GE only pays 3% in American taxes and 10% to 20% in foreign taxes. It was recently disclosed by “60 Minutes” that GE has moved many offices oversees and is hiring oversees and not in America. Of course GE is now a foreign socialist shill corporation set up to take American military contracts away from American corporations. Check out GE’s “Protect America” home security product that doesn’t work. I searched on “GE protect America complaints 2011” and got 51000 hits. Some of the complaints appear to be put out by GE to make Americans sound stupid. This GE product does not work but they collect $29/mo on them anyway because no one discovers they do not work until their house is robbed or the system keeps going off every night for no reason. GE sells Americans fake placebo products and we certainly do not want defective jet engines, security systems, and military equipment.

European shares hit a three-week closing low on Monday.
Spain sold 12- and 18-month Treasury bills today, while Belgium auctioned bonds due in 2013, 2021 and 2041. German bonds gained on demand for safety.

European shares dropped to a three-week low in morning trade on Monday on lingering worries about indebted Euro zone countries. Finland’s election adds another leader opposed to bailouts. It is expected the market will have a long period of rangebound trade.

Greek two- and 10-year government bonds slumped, driving yields to the highest since before the introduction of the Euro amid concern the nation won’t be able to avoid defaulting on its debt.

US Market Highlights

Initial Claims 04/09 rose dramatically to 415K this week from 382K (corrected for Obama manipulation of 3K)
Continuing Claims 04/02 3695K almost unchanged from 3723K (corrected for Obama manipulation of 15K
NAHB Housing Market Index Apr declined again from 17 to now 16. Most of the 45% who pay no taxes live in subsidized housing so Obama doesn’t care if all that have a work ethic are stuck and cannot move because you can’t afford to sell your house at current depressed prices.
Housing Starts Mar 549K up from 512K
Building Permits Mar 594K up from 534K

Today
Apr 20 7:00 AM MBA Mortgage Purchase Index 04/15
Apr 20 10:00 AM Existing Home Sales Mar
Apr 20 10:30 AM Crude Inventories 04/16

This week
Apr 21 8:30 AM Initial Claims 04/16
Apr 21 8:30 AM Continuing Claims 04/16
Apr 21 10:00 AM Philadelphia Fed Apr
Apr 21 10:00 AM Leading Indicators Mar
Apr 21 10:00 AM FHFA Housing Price Index Feb

Market Outlook April 19, 2011
Market volume rose 15% with yesterday’s decline and the VIX rose initially and recovered half way.
http://finance.yahoo.com/q/bc?s=%5EVIX&t=5d&l=on&z=m&q=l&c=

Structural imbalances continue in the economy.
The third economic dip is beginning but likely will only slow growth and not go negative.

The job market and housing problems are growing again. Oil prices are rising again.

The Obama tax code changes reduce the incentive for people to donate to the arts. Socialists want that to happen because that causes people to then want the federal government to fund the arts. That way the socialists and communists control the arts because capitalists cut FED funding.

The stock market is continuing to test its head and shoulders now. The markets all appear to be topping out.
S&P
http://finance.yahoo.com/q/ta?s=%5EGSPC&t=1y&l=on&z=m&q=l&p=m50&a=m26-12-9&c=


World Markets
International trade shows that the world economy has only revived about 25% not the 60% shown by the stock and commodities markets. That means more than half of the stock market rise from the 2009 lows is unsupportable and could evaporate. See:
http://www.bloomberg.com/apps/quote?ticker=BDIY:IND

Asian markets were up last night. China up 0.3%, Hong Kong up 1.6%, India up 1.8%, and Japan up 1.8%.

European markets are up this morning in a range of about 1% to 2.4% half way through their day.

US pre-market futures are up about 1.1 % at 7:00 AM EST.