If you learn nothing else from this profile of Blaine Lourd, you should learn to always hang up on Brokers.

I laughed out loud when I read this….

Nina loans?

The abbreviation stands for “No income, no assets.” It does not mean the loans went to people without either assets or income, only that the borrowers were not asked if they had either. I had known about “stated income” loans — also known as “liars’ loans” — in which the bank took a borrower’s word for how much he earned. But I had not realized you could borrow money without even being asked about your income.

Starting this month, Freddie won’t guarantee such loans, which seem to default more often than other loans.

If you don’t check to see if someone has any income or assets, the loan is more likely to default. Who would have thunk?

(h/t Calculated Risk)

From R-Squared comes an explanation of why oil did not break the 100 mark even though inventory fell. I did not understand the explanation until I read the last comment.

The Bank Of England is going to (has already?) lose a lot of taxpayer money.

From the New York Times comes an article about how insurance companies are shifting costs to homeowners.

Airbus is getting killed by the falling dollar even as its orders soar. It has the misfortune of selling its products in dollars even as it pays for its supplies in euros.

Not much to say about the past week. I did keep up with the claims as they came in, and I spent Saturday dispatching the remaining backlog. But as the second (or third?) week of working overtime to quell the claims came to a close, my capacity to continue doing so waned. on Thursday and Click Here to continue reading.

It is easy to get tired of reading about the current subprime problems. It seems likes everyone is writing the same story over and over again with different words. But sometimes I read something that tells me something I did not now before.

This speech by David Einhorn on the rating agencies was one of those things that told me something new. It is well worth reading if you want a better understanding of how we got into the current mess.

This from Bloomberg….

Saudi Arabia, the world’s largest crude oil exporter, rejected a proposal by Iran and Venezuela to discuss the weak dollar at this weekend’s OPEC summit in Riyadh, saying it didn’t want the U.S. currency to “collapse.”

Saudi Arabia won’t discuss pricing oil in currencies other than the dollar, Saudi Foreign Minister Prince Saud Al-Faisal said, speaking at a meeting of oil and finance ministers today that was accidentally broadcast to journalists.

Oil has stopped its rapid rise for now. So I had hopped that would mean that gas prices would slow their rise. But the government does not think so….

U.S. consumers could pay record gasoline prices for the upcoming Thanksgiving holiday with pump costs expected to climb another 20 cents over the next two to three weeks, the government’s top energy forecaster warned on Monday.

Guy Caruso, who heads the U.S. Energy Information Administration, said not all of the recent jump in crude oil prices has been reflected in motor fuel costs which now top $3 a gallon in many parts of the country, about 80 cents more than a year ago.

“We haven’t seen the full pass-through (of high oil prices) yet,” Caruso told reporters at a briefing on oil market conditions held at Energy Department headquarters. “I would say what’s in the pipe right now (for gasoline) is about another 20 cents.”

This from AP…

A year after its worst holiday sales season ever, Wal-Mart Stores Inc. may rebound to have a good season after finding the right mix of merchandise and marketing to complement its return to a focus on low prices.

A whiff of this already showed up when the nation’s largest retailer posted third-quarter earnings Tuesday of $2.86 billion, an 8 percent rise that beat Wall Street expectations.

The company earned 70 cents per share, up from 62 cents per share in the same period a year ago. The 70 cents includes an after-tax gain equal to 1 cent per share. Analysts surveyed by Thomson Financial had forecast earnings of 67 cents per share on revenue of $91.67 billion.

In part this good news is overstated. Wal-Mart had a horrible year last year, so a lot of that 8% rise is just recovering ground from last year. Still, given the sub-prime problems and the higher gas prices, it is not a bad showing.

Some people suggest that Wal-Mart has survived by luring higher income people down market to replace the money that poor people were not longer able to spend. But I think a large part of it is due to the fact that Wal-Mart sells so much food now. If we assume that Wal-Mart sets its margins as a percentage of total price it would seem that rising food prices would help out their bottom line. People have got to eat.

Also, there is also a lot of anecdotal evidence that indicates people are not eating out as much as they use to. This would also cause them to buy more groceries from Wal-Mart. (Restaurants buy their food from other places).

The other new that help out the stock market today was this…

Last Wednesday, benchmark New York crude oil futures hit an intraday record of $98.62 a barrel and most analysts were saying triple-digit oil was a given. Almost a week later, after the rally in crude oil had the wind knocked out of it by reduced demand growth forecasts and with prices closer to $90, the question being asked is “how low can crude fall?”

Many market participants are loathe to predict a drop below $80 a barrel in the short term, or at least until there’s a better idea of how cold the all-important Northern Hemisphere winter will be. The fourth quarter normally sees the biggest demand for global oil as heating fuel and power demand steps up going into winter.

“It looks to me like the run to $100 a barrel is over for the year as we’re starting to see signs demand is starting to slow,” said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago, who has been a long-time predictor of rising prices based on increasing demand and slowing supply. He said prices could pull back to near $85 a barrel, but the possibility of a cold winter should hold them above that in the near term.

Robert Rapier has been arguing that the run up in oil prices was too extreme even given the falling dollar. Perhaps he is right.

Certainly there are signs that demand destruction is starting to kick in, so I don’t expect oil prices to go much higher unless there is another cut in interest rates or some negative geo-political event happens.

Still, gas prices might keep going up for a while yet. Refiners’ margins are still at a record low.

I still think that in a rational mind the good news would be outweighed by the bad news. All sorts of serious issues have been coming to light with CDO’s and SIV’s that I will not bore you with just yet. But every now and then I like to highlight the good news just so people don’t accuse me of being too unbalanced.

Over at Marginal Revolution we read….
It was Jeffrey Sachs and Betsey Stevenson against myself and Will Wilkinson on the topic of whether America is failing in the pursuit of happiness. The Economist magazine was the sponsor and it was held in Gotham Hall in New York, which yes could have been out of a Click Here to continue reading.

A while ago–a longer while than I realized–I outlined a plan to reduce shipping errors. At that time I promised to give updates and to stay focused on what I could control.
I’ve strayed from that worthy plan. It began to fall apart when the supervisor of the spare parts order pickers would not or could Click Here to continue reading.