[PRCo] Re: Dollar

Thu Nov 8 06:29:45 EST 2007

> ----- Original Message -----
> From: "Fred Schneider" <fwschneider at comcast.net>
> Yes, Jim, but remember how many times I isolated San Francisco, New 
> York and Chicago city proper from the rest of the United States.
>>
>> Ken & Tracie wrote:
>
> They isolate themselves from the rest of the country, too, Fred.
>   
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BERRY  Berry  True~!~!~!       Reading election analysis this evening 
and possibilities in future for a few  *Top__People*  from SF and they 
say they will have trouble outside SF because the rest of the country  
*Perceives~(~?~!__--__Knows~?~!)*   that  SF  is  *Wacky*  --  Their 
Words,  SF  Journalists~!~!~!~!
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> I wonder where we'd farm our food if we had direct voting and the inhabitants of those major urban areas wanted to outlaw farming to protect the habitat of the cottontail rabbit? ;-) Or use all federal tax revenue for urban welfare schemes at the expense of farm subsidies???
>   
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We have Water Wars here and City Dwellers say to Cut Off The Farmers  
--  considering that CA supplies Much food for Much of the Nation In 
Addition to CA, there would be Hades to pay~!~!~!       Talk about short 
sightedness And Much More as well as cutting off the hand to spite the 
foot~!~!~!
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Speaking of which  --  because of some certain fishie in the bay, Delta 
water may  NOT  be diverted for Humans  --  Da Judge Has Ruled  --  we 
Shall have crisis going forward  --  Solly Cholly  --  Not A White 
Rabbit  --  Possibly Red Herring~!~!~!~!~!
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> Or to build rail transit lines that really don't serve the commuters but make the politicians feel good about themselves?????
>   
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That could be AnyWhere U.S.A.      In the early 1900s photographers // 
printers put  TrolleyCars  in the scenes if the town didn't have any 
because it was  *Fashionable.*       Cincinnati started a subway system 
that was interrupted by The Great Depression of the 1930s and was never 
completed.       Some lrv systems today were built because they are  
*Fashionable*    ----    if the Current Credit Crunch spills further 
into the economy then Transit will eventually be hit.       As I 
Mentioned Earlier  --  Recessions // Depressions Do what Humans Should 
Do but are Too Frail to Act.
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http://tinyurl.com/346m6g  --  details some of what I wrote about here 
and before.       Some Isolated Quotes:::::::
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....... """The malaise in the mortgage market is starting to spread to 
credit-card and auto loans in what one analyst has dubbed consumer 
credit "contagion." It's an ominous warning signal for the economy."""
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....... """An added complication was that many Americans used their 
homes as piggy banks in recent years. When debt was cheap and easy to 
get and the value of their homes was surging, they borrowed against 
them. People used part of that cash to pay off other debts, but mostly 
to fuel a spending surge on everything from flat-screen TVs to new cars 
to vacation homes."""
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....... """That party seems to be over. Morgan Stanley analyst Betsey 
Graseck warns that an oncoming consumer credit "contagion" could be 
ahead, and uses that as the basis to downgrade her ratings on large 
banks to "cautious" - the lowest rating at Morgan Stanley has on 
industries. Among those on her watch list: Citigroup, Bank of America 
and Wells Fargo."""
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....... WHOA--- """So much for this year's credit turmoil resolving 
itself soon. Now it seems to be feeding on itself."""
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....... PS  --  Not happy that Capitol One is having so many problems, 
but not surprized either as I received Multiples upon Multiples upon 
Multiples of solicitations for their CC  --  to which I never responded.

ALL BUSINESS: Credit "Contagion" Spreads

Nov 6, 2007 12:52 PM (1 day ago) By RACHEL BECK, AP

NEW YORK (Map 
<http://www.examiner.com/map.cfm?latlong=40.75%20-73.9967&dateline=NEW%20YORK>, 
News <http://www.examiner.com/Dateline-NEW%20YORK.html?cid=dateline>) - 
The malaise in the mortgage market is starting to spread to credit-card 
and auto loans in what one analyst has dubbed consumer credit 
"contagion." It's an ominous warning signal for the economy.

Many of the nation's big banks and credit-card companies have begun 
acknowledging that they are seeing a shift in consumer behavior, 
including more people unable pay off their debts.

Things are unraveling faster than expected for some like Capital One 
Financial Corp. (COF 
<http://www.examiner.com/Stock_Quotes.html?symb=COF>, News 
<http://www.examiner.com/News-Capital_One_Financial_Corp.html>), which 
on Tuesday boosted its estimates for credit losses next year to 
potentially above $5 billion in part because of elevated delinquencies 
on its cards.

No one is calling this problem the next debt-related land mine yet, but 
it is still important to watch what happens, especially as the holiday 
shopping season gets under way.

Much attention has been paid in recent months to the collapse in housing 
prices and the upheaval in the mortgage market. The initial trigger was 
people with shaky credit - known as subprime borrowers - increasingly 
defaulting on their home loans.

An added complication was that many Americans used their homes as piggy 
banks in recent years. When debt was cheap and easy to get and the value 
of their homes was surging, they borrowed against them. People used part 
of that cash to pay off other debts, but mostly to fuel a spending surge 
on everything from flat-screen TVs to new cars to vacation homes.

That party seems to be over. Morgan Stanley analyst Betsey Graseck warns 
that an oncoming consumer credit "contagion" could be ahead, and uses 
that as the basis to downgrade her ratings on large banks to "cautious" 
- the lowest rating at Morgan Stanley has on industries. Among those on 
her watch list: Citigroup, Bank of America and Wells Fargo.

She says there is already evidence that subprime mortgage implosion is 
affecting other areas, given that banks have tightened their lending to 
consumers. She expects more stringent lending standards to put the 
squeeze on consumers at the same time unemployment rates are rising and 
housing values are falling.

In recent weeks, many banks and card issuers have boosted what is known 
as loan-loss reserves. Under accounting rules, they are required to 
estimate the amount of loans that won't be collected, and should that 
increase, they must set aside more money to cover those loans. Higher 
loan-loss reserves equal lower earnings.

"Firms that are now adding to the portfolio might have had a few whiffs 
of trouble brewing earlier this year, and dragged their feet in adding 
to reserves because they were hoping that interest rate cuts might bail 
them out and give borrowers breathing room," said Jack Ciesielski, who 
writes the industry newsletter, The Analyst's Accounting Observer.

"Now the odor is getting stronger, and it looks like adding reserves is 
the only course of action they can follow without presenting misleading 
financials," he said.

When Citigroup announced its quarterly earnings last month, it noted two 
"behavioral patterns" that could be correlated with future delinquencies 
and losses on its credit cards. The bank said that it had seen evidence 
of cardholders increasing the balance on their cards or some for the 
first time are using the card to take cash advances.

CFO Gary Crittenden, during a conference call with analysts, said such 
evidence contributed to the company's decision to take a charge totaling 
$1.30 billion to increase its loan-reserves for U.S. cards during the 
quarter ended Sept. 30. That compared with a reserve release of $197 
million in the same period a year ago.

Capital One, when announcing its third-quarter results on Oct. 18, cited 
higher delinquency rates in its credit card and auto loan divisions, and 
said in both areas it had boosted provisions for uncollectable debts. It 
had estimated total 2008 credit losses for its entire loan portfolio 
would be around $4.9 billion.

Then on Tuesday, the McLean, Va.-based company said more difficult times 
were likely ahead. It raised its range of credit losses to as high as 
the mid-$5 billion mark. Its chief risk officer, Peter Schnall, said 
during an investor conference that card delinquencies in the fourth 
quarter are "unlikely" to decline the way the company had assumed. He 
said the company, in its revised range, now assumes the economy in 2008 
will continue to be sluggish.

Loans for credit cards, auto financing and other debt are often sliced 
up and sold as securities on global debt markets. Mortgages are 
securitized that way, too. And as has been evident in recent months, 
surging defaults in mortgage portfolios have knocked down the value of 
those assets, creating a ripple effect as securities have had to be 
repriced at much lower values.

These new consumer worries could just spell more trouble for financial 
companies, as Morgan Stanley's (MS 
<http://www.examiner.com/Stock_Quotes.html?symb=MS>, News 
<http://www.examiner.com/News-Morgan_Stanley.html>) Graseck noted last 
week in her banking industry downgrade.

Financial stocks have accounted for 342 points to the downside in the 
Dow Jones industrial average this year, and are the only sector dragging 
down the index. Without them, the Dow would be 2.5 percent higher than 
it is now, according to Bespoke Investment Group.

So much for this year's credit turmoil resolving itself soon. Now it 
seems to be feeding on itself.
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^~^~^~^~^~^~^~^~^~^
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Jim  Holland
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Studying Pittsburgh Railways Company (PRCo)
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..............................From 1930 -- 1950
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Pennsylvania  Trolley  Museum  (PTM)
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http://www.pa-trolley.org/
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N.M.R.A.
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http://www.nmra.org/