Unscrew the cap and savor the aroma. Yes, relief is on the way. You turn the bottle up, one swig, and then another. Yeah, that'll do it. Put the bottle down, sit back, and relax. Let the Maalox work its magic....Ahhhhhhhhhhhhhh   Whewwwww, that was close!   Financial Times – July 29 – (Paul J Davies and Joanna Chung):  “Banks have been given a one-year reprieve by US accounting standard-setters from having to take up to $5,000bn of debt assets on to their balance sheets, easing fears that they would be forced to raise large amounts of new capital quickly.  The Financial Accounting Standards Board voted to delay until January 2010 the introduction of rules that will force banks to consolidate more off-balance-sheet vehicles directly in their accounts.  However, Robert Herz, FASB chairman, said that the move was made reluctantly after a staff recommendation for a delay because there might not be enough time for all companies to adjust to the up-heaval.  ‘It does pain me to allow something that has been abused by certain folks, to let that go on for another year,’ he said.”

What, no bonus this year?!!

July 30 – Bloomberg (Meg Tirrell):  “Profits at U.S. companies may have dropped the most in at least a decade last quarter after credit writedowns triggered a combined $7.43 billion loss at Merrill Lynch & Co. and Lehman Brothers Holdings Inc.  Earnings of S&P 500 Index companies have tumbled 24% from a year earlier, according to data compiled by Bloomberg on the 291 companies that had reported quarterly results… As recently as July 3, analysts expected a drop of 11%.  Financial industry profits… have plummeted 87%... The energy group of the S&P 500 has posted a 15% gain in profits so far.”

Buffy can't sell her summer home.

July 30 – Bloomberg (Sharon L. Lynch):  “Home prices in the Hamptons, the summer haven of New York financiers and socialites, fell almost 12% in the second quarter from a year earlier as Wall Street firms cut jobs and the economy teetered near a recession.  Sales dropped 26% and the median price slid to $970,000 in the resort towns on the East End of Long Island… broker Prudential Douglas Elliman Real Estate and appraiser Miller Samuel Inc. said… ‘We used to think of the Hamptons as insulated and that’s not the case,’ said real estate developer Arthur Rauscher…  It’s not what it used to be.’” (Duhhh, ya' think?)

Sleepless in New York   July 29 – Bloomberg (Henry Goldman):  “New York Governor David Paterson said the state’s economic slide has created a fiscal crisis so severe the Legislature must meet in special session next month. Paterson… said the deficit for the budget year beginning April 1, 2009, has ballooned to $6.4bn from a previously projected $5bn amid a slump on Wall Street… New York state, where Wall Street’s workers and businesses provide about 20% of state tax revenue, has been hurt as financial firms posted more than $468 billion in writedowns and credit losses... Sixteen of the state’s largest banks sent taxes totaling $5 million to the state treasury in June, a 97% decrease from a year earlier…”   http://www.prudentbear.com/index.php/CreditBubbleBulletinHome