US stocks ended Monday with losses on fresh concerns that the current market levels are overblown.  A rebound in dollar against key foreign currencies sent commodities lower and financials fell as reports emerged the federal government may require Bank of America to raise more capital.  The group took another beating as influential analyst Richard Bove trimmed his ratings on a number of regional banks.  Homebuilders also led the market lower on reports the first time homebuilders' tax credit is unlikely to be extended.

The Dow Jones industrial average oscillated within a 200-point range and briefly touched the 10,000 mark, before some profit taking saw the index squandering the earlier advance and ending the day 104-points lower.  Technology shares, only sector to have recorded gains last week, fell out of favor and slid along with the broader market.  The technology-laden Nasdaq retreated 12.62 points, or 0.6%, to 2,141.63.  The CBOE

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Billionaire investor George Soros said yesterday (Monday) that the U.S. recovery would be a slow one because of all the “basically bankrupt” financial companies impeding it.

U.S. Federal Reserve Chairman Ben S. Bernanke and Congress agreed Friday that the financial system – not the American taxpayer – should bear the costs of bank bailouts. Sheila Bair, head of the Federal Deposit Insurance Corp. (FDIC), wants the banks to ante up $45 billion – three years’ worth of deposit-insurance premiums – to bail out the fund that insures bank deposits.

When it comes to bank stocks, we all know that there were a number of Money Morning readers shrewd enough to buy Citigroup Inc. (NYSE: C) shares when the foundering giant’s stock price was below $1 a share.

If you’re one of those investors, good for you: With Citi’s shares now trading at nearly $4.70 a share,

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The FDIC is considering tapping its emergency line of credit with the Treasury. FDIC Chair Sheila Bair recently hinted after a speech at Georgetown University that all options are on the table when it comes time to replenish the dwindling Deposit Insurance Fund. We’ll find out more in the next few weeks after the FDIC board of directors meets.

Stock market bulls aren’t concerned about the inevitable acceleration in bank failures — at least for now. Even though deposits will be insured against loss, the loss of local banks will still have a depressing effect on hundreds of small communities. These communities are going to lose their only access to business credit when their local zombie banks — loaded with toxic construction or commercial real estate loans — are liquidated or merged into other weak banks.

Meanwhile, the latest monthly figures show that commercial bank balance sheets are shrinking at a fairly

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Looks like another government arm will soon be knocking on the Treasury’s door: “We are currently considering all options, including borrowing from the Treasury,” said FDIC chairwoman Sheila Bair. As we’ve forecast many times, the steady collapse of banks around the U.S. has put an irreparable dent in the FDIC deposit insurance fund.

Now likely less than $10 billion strong and with more bank failures sure to come, the FDIC faces two choices: Raise their taxes on banks to bolster the fund or tap the Treasury. Given the health of the U.S. banking system and the tendencies of our government over the last decade, you can probably guess which Bair will chose. Here’s another hint… Barney Frank, leader of the House Financial Services Committee, has already publicly opined on what Bair should do.

The FDIC has the authority to borrow as much as $500 billion through 2010.

“Stock market bulls aren’t concerned about

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The main purpose behind the FDIC is to insure bank deposits. To do so, it must have money available to pay off depositors. That pool of capital is rapidly draining away. The deposit insurance fund fell to $10.4 billion at the end of the second quarter from $13.0 billion at the end of the first quarter. As a percentage of insured deposits, that is down to 0.22% from 0.27% at the end of the first quarter and 1.01% a year ago. Normal is about 1.20% of deposits. (See graph below from http://www.calculatedriskblog.com/). The decline came despite a special assessment on the banks that brought in $9.1 billion in the quarter. Why? It is because of all the Friday night pizza parties Sheila Bair (head of the FDIC) has been holding. During the quarter, 24 insured institutions with combined assets of $26.4 billion failed, at a net ...

Alabama regional lender, Colonial Bank, just became the 6th largest bank failure in U.S. history and the largest since Washington Mutual last year.

Regulators seized Colonial last Friday, selling the bank’s deposits and assets to their competitor BB&T. Colonial was founded by real estate developer, Robert E. Lowder in 1981. The bank stayed true to its roots, right to the end (of the housing bubble).

In a 2006 interview, Lowder said, “We’ve always been a real estate bank. We understand real estate lending. For us, we think it’s a good safe market to be in.” Evidently, they didn’t understand the market as well as they thought. The bank sunk under the weight of $1.7 billion in losses on bad real estate loans.

The real question regarding the failure of Colonial, is what this will do to the Deposit Insurance Fund (DIF) maintained by the FDIC.

The FDIC Deposit Insurance Fund started 2008

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As you can see, more green shoots! Boy this stimulus sure is working. US Sen Bunning: FDIC#8217;s Bair Said Up To 500 More Banks Could Fail By Jessica Holzer, Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- Federal Deposit Insurance Corp. Chairman Sheila Bair believes up to 500 more banks could fail, a U.S. senator said Bair told him [...]div class="feedflare" a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:yIl2AUoC8zA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=yIl2AUoC8zA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:F7zBnMyn0Lo"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=sGkRxWbazfc:K2usq4yFtUY:F7zBnMyn0Lo" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:7Q72WNTAKBA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=7Q72WNTAKBA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:V_sGLiPBpWU"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=sGkRxWbazfc:K2usq4yFtUY:V_sGLiPBpWU" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:qj6IDK7rITs"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=qj6IDK7rITs" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:l6gmwiTKsz0"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=l6gmwiTKsz0" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=sGkRxWbazfc:K2usq4yFtUY:gIN9vFwOqvQ"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=sGkRxWbazfc:K2usq4yFtUY:gIN9vFwOqvQ" border="0"/img/a /div

The Dow Jones Industrial Index on Thursday breached 9,000 for the first time since January and the Nasdaq Composite Index notched up a 12th consecutive advancing day (the first time sine 1992) as favorable reactions to earnings and economics reports propelled stocks and other risky assets higher. Meanwhile, the usual debate on the outlook for the economy and shenanigans of financial institutions again dominated the video channels over the past few days.

Fed Chairman Ben Bernanke’s bi-annual testimony on Capitol Hill (and an expected grilling by Alan Grayson) and other highlights of the week’s trials and tribulations were captured on video and are included in this video-o-rama compilation. Strutting their stuff were a star-studded cast including the likes of Martin Feldstein, Stephen Roach, Bill King, Nouriel Roubini, Sheila Bair, Mario Gabelli and George Friedman.

The compilation starts off with an interview with Harvard’s Martin Feldstein about his “double-dip” economic

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If history is our guide, then the rally we’ve seen in U.S. stocks in recent weeks is more than just a periodic run-up in share prices – it’s the initial stage of a prolonged bull market.

The 13-week rally the Dow Jones Industrial Average has experienced off its March lows is the most powerful surge that index has seen since the Great Depression. If we look to history, stocks should continue to rally over the next three months.

“I say this with the utmost confidence and my fingers tightly crossed: This is the start of a new bull run,” Hugh Johnson, chairman of Johnson Illington Advisors, told MarketWatch.com.

The 13-week stretch from March 9 through May 29, which saw the Dow soar 28.3%, has been bested only once – by the 40.8% run-up the Dow enjoyed in the 13 weeks that followed its hitting a bottom in May 1932. The

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A free market no longer exists. The government’s multi-trillion attempt to ‘fix’ the recession has dealt whatever was left of a free market a death blow. And the scam-financed rally in US stocks off March lows shows that the government is able to pull off an impressive shift in the markets despite a slew of appalling economic data points.

Take a bow, Mr Geithner… Well done, Mr Bernanke… Hats off, Mr Obama… You want us to believe that banks are recovering, housing has bottomed, stimulus works and borrowing leads to prosperity. And so far, you’ve mostly got your way.

As economic commentator James Quinn put it recently on PrudentBear.com, Obama, Geithner and Bernanke, aided and abetted by Sheila Bair, Barney Frank and a Democrat-controlled Congress “colluded to commit taxpayer funds to enrich bankers that brought down the financial system, without getting congressional approval.”

They also have delayed foreclosures and have tried

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