ALMOST ARMAGEDDON – MARKETS WERE 500 TRADES FROM A MELTDOWN

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The market was 500 trades away from Armageddon on Thursday, traders inside two large custodial banks tell The Post.

Had the Treasury and Fed not quickly stepped into the fray that morning with a quick $105 billion injection of liquidity, the Dow could have collapsed to the 8,300-level – a 22 percent decline! – while the clang of the opening bell was still echoing around the cavernous exchange floor.

According to traders, who spoke on the condition of anonymity, money market funds were inundated with $500 billion in sell orders prior to the opening. The total money-market capitalization was roughly $4 trillion that morning.

The panicked selling was directly linked to the seizing up of the credit markets – including a $52 billion constriction in commercial paper – and the rumors of additional money market funds “breaking the buck,” or dropping below $1 net asset value.

The Fed’s dramatic $105 billion liquidity injection on Thursday (pre-market) was just enough to keep key institutional accounts from following through on the sell orders and starting a stampede of cash that could have brought large tracts of the US economy to a halt.

Read moreALMOST ARMAGEDDON – MARKETS WERE 500 TRADES FROM A MELTDOWN

Paulson Bailout Plan a Historic Swindle

Financial-market wise guys, who had been seized with fear, are suddenly drunk with hope. They are rallying explosively because they think they have successfully stampeded Washington into accepting the Wall Street Journal solution to the crisis: dump it all on the taxpayers. That is the meaning of the massive bailout Treasury Secretary Henry Paulson has shopped around Congress. It would relieve the major banks and investment firms of their mountainous rotten assets and make the public swallow their losses–many hundreds of billions, maybe much more. What’s not to like if you are a financial titan threatened with extinction?

Read morePaulson Bailout Plan a Historic Swindle

Bomb Explodes at Hotel in Pakistan’s Capital, Killing at Least 40


Flames poured from the Marriott Hotel in Islamabad on Saturday after a massive truck bombing.

ISLAMABAD, Pakistan – A huge truck bomb exploded at the entrance to the Marriott Hotel in Islamabad on Saturday evening, killing at least 40 people and wounding more than 150, the police said.

The blast, one of the worst acts of terrorism in Pakistan’s history, went off just a few hundred yards from the prime minister’s house, where all the leaders of government were dining after the president’s address to Parliament.

Read moreBomb Explodes at Hotel in Pakistan’s Capital, Killing at Least 40

Bush wants OK to spend $700.000.000.000

Bailout proposal sent to Congress seeks authorization to spend as much as $700 billion to buy troubled mortgage-related assets.

NEW YORK (CNNMoney.com) — President Bush has asked Congress for the authority to spend as much as $700 billion to purchase troubled mortgage assets and contain the financial crisis.

The legislative proposal – the centerpiece of what would be the most sweeping economic intervention by the government since the Great Depression – was sent by the White House overnight to lawmakers.

Read moreBush wants OK to spend $700.000.000.000

Pat Buchanan: The Party’s Over

The Crash of 2008, which is now wiping out trillions of dollars of our people’s wealth, is, like the Crash of 1929, likely to mark the end of one era and the onset of another.

The new era will see a more sober and much diminished America. The “Omnipower” and “Indispensable Nation” we heard about in all the hubris and braggadocio following our Cold War victory is history.

Read morePat Buchanan: The Party’s Over

Greenspan’s sins return to haunt us

Back in 2002, when his reputation as “The Man Who Saved the World” was at its peak, Alan Greenspan, former chairman of the Federal Reserve, came to Britain to pick up his knighthood. His biggest fan, Gordon Brown, now the UK prime minister, had ensured that the citation said it was being awarded for promoting “economic stability”.

During his trip, Mr Greenspan visited the Bank of England’s monetary policy committee. He told them the US financial system had been resilient amid the bursting of the internet bubble. Share prices had halved and there had been massive bond defaults, but no big bank collapses. Mr Greenspan lauded the fact that risk had been spread, using complex derivative instruments. One of the MPC members asked: how could this be? Someone must have lost all that money; who was it? A look of quiet satisfaction came across Mr Greenspan’s face as he answered: “European insurance companies.”

Six years later, AIG, the largest US insurance company, has in effect been nationalised to stop it blowing up the financial world. The US has nationalised the core of its mortgage industry and the government has become the arbiter of which financial companies should survive or die.

Read moreGreenspan’s sins return to haunt us

US Taxpayer: A Giant Dumpster For Illiquid Assets

Paulson, Bernanke, and Congress are conspiring to make the US taxpayer the fall guy for financial stupidity by banks and brokers. Congress is now willing to ram through legislation at the last moment, even though Senate Majority Leader Reid Says “No One Knows What to Do”.


Please consider Paulson, Bernanke Push New Proposal to Cleanse Balance Sheets (at taxpayer expense).

U.S. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke proposed moving troubled assets from the balance sheets of American financial companies into a new institution.

Congressional leaders who met with Paulson and Bernanke late yesterday in Washington said they aim to pass legislation soon. The initiative, which may also insure money-market funds, is aimed at removing the devalued mortgage-linked assets at the root of the worst credit crisis since the Great Depression.

Read moreUS Taxpayer: A Giant Dumpster For Illiquid Assets