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Wednesday Financial Briefing

Equities gave up much of the ground they gained earlier in the week in yesterday's trading. The Dow was off 148 points to close at 10293.52, while the S&P 500 dropped 17.89 to close at 1095.31. [UPDATE: Fixed the S&P close.] Energy stocks led the losers, but investor concerns over the poor US housing numbers and the continuing weak employment picture also contributed to the decline. On the fixed-income side of the house, the US Treasury just conducted an auction of 2-year notes at a record-low 0.738 percent rate. The US Treasury is still seen by most investors as the safest port in the financial storm now sweeping across the globe. Pull quote:

“It was a great auction,” said Michael Franzese, managing director and head of Treasury trading at Wunderlich Securities Inc. in New York. “If the world goes to hell, your money is secure. If things turn around really fast, you don’t lose a lot.”

Translation: yield is dead; investors are just looking not to lose money at this point.

Sales of previously-owned homes fell in May. Unexpectedly. A total shockeroo, that's what that was. A real gob-smacker. A once-in-an-epoch bit of weirdness that absolutely no one could have seen coming. An anomaly, a "black swan", a 25-sigma event. A bizarre, unrepeatable, out-of-left field happenstance that has left observers flummoxed.

In a bid to ensure that their 2010 electoral drubbing goes from "historic" to "epochal", the Democrats won't even bring a budget to the floor for 2010. They will simply use a "deeming" resolution. Remember that word from the health care bill debacle, kids? If your Mom tells you to clean your room, now you can simply deem it cleaned without lifting a finger and then go out and play! And just to break the knife off after they've stuck it in, Steny Hoyer announces that taxes on the middle class are going up.

GOP leader Boehner is not amused.

Even the Germans are making fun of Obama and his Keynesian Keystone Kops now. The next thing you know, it'll be the French mocking us. And that, my friends, will burn like acid. Acid!

Standard & Poor states the obvious, and was probably handsomely compensated for doing so.

Peter Orszag looks out over the smoking ruin of America's economy, pronounces himself satisfied, and dashes off to wed his lady fair. (Orszag, let us remember, is the guy who said that the reason government workers pull down more than their private-sector counterparts is because they're smarter than you.)

In news that is sure to warm the cockles of fiat-money partisans, Gold took a drubbing, falling nearly 2% from its record high. To gold bugs like me? Buying opportunity, baby! Gotta build up that pirate-hoard! (Commodities are doing pretty badly across the board, actually, which is another bad sign for any kind of recovery. If no one is buying raw materials, then industrial output is probably also slowing.)

Housing bubble version 2.0. It's kind of like the software business, I guess: it still crashes a lot, and it's got a lot of new features that no one is quite sure how to use.

British cider is spared the dreaded cider-tax! Thank God and all the saints! Albion's cider is safe!

Grandpa would like you to know that he's very disappointed in you. Yes, you. No five-dollar bill in your birthday card this year, young man!

Dollar Bill warns Dr. Doom that justice will prevail! (Does anyone else smell the rather piquant whiff of sour grapes emanating from this column, by the way?) Booster Gold looks on and mutters, "Gold, bitches!"

I always thought that Jimmy Carter would remain the gold standard for modern Presidential incompetence and futility. But Barack Obama, the comback kid, has already usurped Jimmah's spot a mere two years into his term. What wonders still await us as the remainder of Bammer's term plays out? And Bammer is a young man; he has a great shot at being the worst former President as well, a title also held by the lamentable Mr. Carter.

Peter Schiff, noted dollar-doubter and gold bug, qualifies for the Connecticut Senate primary. He'll be contending against Linda McMahon, wife of World Wrestling Entertainment impresario Vince McMahon. The outcome will be decided in a pay per view cage match in a three-falls-out-of-five contest.

Orwell would have been proud: "Prosperity from Austerity". INGSOC thrives in Albion. (I don't argue, by the way, that austerity isn't needed. I just doubt -- seriously -- as to whether it will be fully implemented and stuck to.)

In Timmah's world, increasing the availablility of credit to people who are already drowning in debt counts as smart financial advice. You know who Tim Geithner reminds me of? Fredo from The Godfather. Hopeless, helpless, shifty, incompetent, not terribly bright. If someone invites you on a little fishing expedition, Fredo, do yourself a favor: make sure to have other plans.

If you're a high-schooler looking for a summer job, your best bet looks to be sex slavery, murder-for-hire, selling your blood, or Occult Apprentice to a Master of the Dark Arts. (Teens who have already sold their souls for liquor, sex, or illegal drugs need not apply to the Dark Arts Guild. Teens will be required to promise their souls in exchange for a Guild Card.)

California was ridin' dirty before Illinois was even in the neighborhood, talking smack and acting the fool. California is boned, homies; no one can be boned like Callie. But haters gonna hate.

NRO has stolen my "Daily Briefing" idea* and given it a hoity-toity Limey name. But you come to the AoS Daily Financial Briefing. Why? Poop jokes, bile, witty repartee, up-to-the-minute social satire, and doom, that's why! Go to them for baseline conservative financial op-ed stuff; come to me for hilarity and pants-shitting dread in equal measure!

*Which I in turn stole from any number of other people.

Today's financial briefing brought to you by Mongo, who wishes you to know that he is only a pawn in the game of life.