$43.5 Billion Spying Budget for Year, Not Including Military
The number released Tuesday does not include the billions of dollars that military services spend annually on intelligence operations. The total spying budget for the last fiscal year, including this Pentagon spending, is said to have been in excess of $50 billion.

Quick Overview

• The Federal Reserve reduced the federal funds rate from 4.75% to 4.50%, as expected. The discount rate was reduced from 5.25% to 5.00%
  

• U.S. GDP rose 3.9% YoY, the best quarterly performance in over a year.
  

• U.S. employment cost index rose 0.8% QoQ and up 3.3% YoY.
  

• U.S. Personal consumption rose 1.9%
  

• U.S. construction spending rose 0.3% QoQ. YOY construction spending is down 3.2%
  

• The Chicago purchasing managers' index fell from 54.2% to 49.7%, weaker than expected
  

• Canada's GDP rose 0.2% MoM, and 2.4 YoY.
  

• Japan estimates GDP growth at 1.8% down from 2.1%.
  Japan kept rates unchanged at 0.50%.
  Japan's housing starts fell 44% YoY
  

• Unemployment rate in the Euro area dropped from 7.4% to 7.3%.
  

• The U.S. Department of Energy said:
  Supplies of crude oil fell 3.9 million barrels to 312.7 million barrels.
• Supplies of gasoline rose 1.3 million barrels
  Supplies of heating oil supplies rose 500,000 barrels.
  Refinery use fell from 87.1% to 86.2%
  U.S. gasoline demand rose 0.3% YoY
  Distillate demand fell 0.7%.
  
  
  

War Plans: United States and Iran
A possible U.S. attack against Iran has been a hot topic in the news for many months now. In some quarters it has become an article of faith that the Bush administration intends to order such an attack before it leaves office. It remains a mystery whether the administration plans an actual attack or whether it is using the threat of attack to try to intimidate Iran -- and thus shape its behavior in Iraq and elsewhere. Unraveling the mystery lies, at least in part, in examining what a U.S. attack would look like, given U.S. goals and resources, as well as in considering the potential Iranian response. Before turning to intentions, it is important to discuss the desired outcomes and capabilities. Unfortunately, those discussions have taken a backseat to speculations about the sheer probability of war.

Quick Overview

• U.S. Consumer confidence fell more than expected, from 99.5 to 95.6, lowest in two years.
  

• Germany's unemployment rate fell from 8.8% to 8.7%.
  

• The national average price of diesel fuel rose 6.3 cents to $3.157 a gallon, matching the all-time record set two years ago.
  
  

• Australia predicts the current wheat crop at 12.1 million tons down form 15.5 previously forecast and 13.5 the last USDA prediction.
  

• Australia's livestock industry will be forced for the first time to import grain from overseas if local supplies continue to dwindle in the crippling drought, producers have warned.
  

• The International Sugar Organization said a global sugar excess may take as long as two years to reduce because of record crops in India and Brazil.
  

• Cocoa: There is concern that black pod disease may be spreading in the Ivory Coast
  

• US real estate wealth is expected to fall anywhere from US$2 trillion to US$4 trillion when the total costs of the recent credit crunch are tallied, the New York Times reported.

Quick Overview

• The Federal Reserve begins its two-day meeting tomorrow, and the market anticipates a rate cut.
  

• Retail sales in Japan rose 0.5% MoM

• Japan's unemployment rate rose to 4% from 3.8% last Month.
  

• Tropical Storm Noel may be heading for the Gulf of Mexico.
  

• Gold and agriculture prices rose, and oil reached a new record close.
  

• The dollar sank to a new low against the euro and a 47-year low against the Canadian $.
  

• There is talk of increasing South African mine safety rules, that could make it harder for South African gold production to recover.
  

China Passes U.S. in Top 10 List as China Life Surges
``European countries were also surprised at the beginning of the 20th century when American companies overtook European companies,'' he said. ``The world better get used to it.''

Rumsfeld flees France fearing arrest US embassy officials whisked Rumsfeld away yesterday from a breakfast meeting in Paris organized by the Foreign Policy magazine after human rights groups filed a criminal complaint against the man who spearheaded President George W. Bush's "war on terror" for six years.

Under international law, authorities in France are obliged to open an investigation when a complaint is made while the alleged torturer is on French soil.

Quick Overview

• The University of Michigan's consumer sentiment index dropped from 82.0 to 80.9 in October.
  

• Australia’s leading indicators rose 0.7%.
  

• The USDA said that beef production totaled 2.09 billion pounds in September, down 3% YoY.
  

• The USDA said pork production totaled 1.75 billion pounds in September
  

• Countrywide Financial lost $1.2 billion in the third-quarter, but its shares rose after the largest U.S. mortgage lender said it expects to be profitable in the fourth quarter and in 2008.
  
  
  

• While Bush, and G.O.P. candidates led by Romney, take hostilities against Iran to new highs, the dollar makes new lows, crude oil and gold make new highs.
  

Quick Overview

• U.S. New home sales fell 23% YoY.
  

• U.S. Durable goods orders fell 1.7% in September, weaker than expected. Excluding transport orders rose 0.3% in September.
  

• The DoE said underground supplies of natural gas were up 68 billion cubic feet last week to 3.443 trillion cubic feet.
  

• China’s GDP rose 11.5% QoQ.
  

• The U.S. Fed is close to agreeing to changes in its communication strategy, including quarterly publication of internal forecasts, but it will not adopt an inflation target any time soon.
  
  

• Microsoft said first-quarter earnings rose 23 percent, exceeding estimates.
  
  

• Crude oil rose above $90 after a report showed a drop in U.S. stockpiles and the U.S. imposed new sanctions against Iran. This is prompting new fears about supplies ahead of the peak winter season.
  

• For the eighth month Japan's consumer prices fell 0.1%, a sign that deflation lingers in the world's second-largest economy.
  

• Japan’s industrial production fell 1.4 %
  

Quick Overview

• U.S. Existing home sales fell 8.0% from August's pace -- the lowest since records began in 1999.
  

• The U.S. Department of Energy said that:
  Supplies of crude oil were down 5.3 million barrels to 316.6 million barrels,
  Supplies of gasoline were down 2.0 million barrels.
  Supplies of heating oil were up 900,000 barrels.
  

• Australia’s consumer prices rose 0.9% QoQ and up 2.9% YoY.
  

• Germanys leading economic indicators fell 0.8% in August.
  

• The Commodity Futures Trading Commission told Congress on Wednesday the electronic Intercontinental Exchange's natural gas contract should be subject to more government oversight.
  
  

• Merrill Lynch announced that its US mortgage-related losses were not $4.5bn but $7.9bn.

The cost of the wars in Iraq and Afghanistan could total $2.4 trillion
A previous CBO estimate put the wars' costs at more than $1.6 trillion. This one adds $705 billion in interest, taking into account that the conflicts are being funded with borrowed money.

Quick Overview

• Retail sales in Canada rose 0.7%
  

• Industrial new orders in the Euro area rose 0.3% MoM and 5.1% YoY.
  

• YoY Japan's trade surplus rose 62.7%.
  
  

U.S. lawmakers to mull subprime bankruptcy relief Under the plan, bankruptcy judges could extend the life of a home loan, change the interest rate or simply mark down the loan amount. Judges currently have that broad authority to modify other types of debt, including money owed on credit cards or auto payments.

Updates resume "after" San Diego fires, hopefully within the next couple of days!

Quick Overview

• Turkey is serious about sending troops into northern Iraq to hunt down Kurdish separatist rebels hiding there and is not bluffing, a senior minister said.
  
  
  
  

• The dollar fell to a 33-year low against the Canadian, hit a record low ageist the Euro, a poor housing market, so-so corporate earnings, oil prices at $90 -- and Wall Street took a hit.
  
  

• U.K.'s GDP rose 0.8% QoQ and up 3.3% YoY
  

• Canada’s consumer prices rose 0.2% MoM and 2.5% YoY
  
  
  

• USDA's Keith Collins believes US corn acreage will decline in the coming year to 87 million, cotton to 10 million. Collins estimates US wheat plantings at 64 million acres, soybeans at 70 million - both increases from the previous year.
  
  

• There is talk that Russia will increase its export duty on wheat to 30%. Currently Russia plans a 10% duty on wheat exports to take effect next month.
  
  

• The USDA said there were 10.967 million head of cattle on feed on October 1st, down 3.7% YoY. Placements rose 9% YoY and marketing’s fell 3%.
  
  

• The USDA attaché expects Brazil’s sugar production in 2007-2008, up 2%. He also expects Brazil’s ethanol production up 16%.
  

• YoY the U.S. cocoa grind, at 94,179 tons, fell 14%.
  
  

Quick Overview

• The number of U.S. workers filing new claims for jobless aid jumped by 28,000 last week, more than expected and the biggest increase for any week since February.
  

• The Philadelphia Federal Reserve's regional index of manufacturing dropped from 10.9 to 6.8 in October, a sign of slower growth.
  

• U.S. leading indicators rose 0.3% in September
  

• U.K. Retail sales rose 0.6% in September, more than expected.
  

• The U.S. Department of Energy said that underground supplies of natural gas were up 39 billion cubic feet last week to 3.375 trillion cubic feet. YoY supplies are down 2%
  

• Wheat sales have reached 82.6% of the USDA forecast for the entire marketing year as compared to 51.3% on average over the last five years.

Housing Downturn Takes Toll on Cities’ Revenue
In Palm Beach County, Fla., foreclosures rose to 4,830 in 2006 from 3,049 in 2005. And in just the first eight months of this year, the number hit 7,544, said Sharon R. Bock, the county’s comptroller and clerk. Vacant job positions in Ms. Bock’s office are going unfilled, and “it could get worse,” she said.

OJ Prices Jump As Citrus Land Shrinks
Florida lost 127,182 acres (17 percent of its total) in the 2006 crop census -- the second worst drop in history behind only a January 1986 freeze. The net loss was higher than the previous eight years combined.
The U.S. Department of Agriculture does not tie specific reasons to any acre lost, but growers and other industry officials say the problems are plain. Canker and greening forced the destruction of tens of thousands of acres of trees in the past decade, and bad hurricane seasons in 2004 and 2005 raked groves. Some farmers sold to developers when land prices skyrocketed the past few years, though recent slowing in the housing market probably stymied that trend.

Britain to claim more than 1m sq km of Antarctica
The United Kingdom is planning to claim sovereign rights over a vast area of the remote seabed off Antarctica, the Guardian has learned. The submission to the United Nations covers more than 1m sq km (386,000 sq miles) of seabed, and is likely to signal a quickening of the race for territory around the south pole in the world's least explored continent.

The claim would be in defiance of the spirit of the 1959 Antarctic treaty, to which the UK is a signatory. It specifically states that no new claims shall be asserted on the continent. The treaty was drawn up to prevent territorial disputes.

Quick Overview

• U.S. Housing starts were down 10.2% MoM and down 31% YoY.
  

• U.S. consumer prices rose 0.3% MoM and 2.8% YoY
  

• The adjustment from recent financial market turmoil is "far from over" though the situation seems to have improved, a senior New York Federal Reserve Bank official said.
  

• The Fed’s Beige Book said economic activity continued to expand in all Districts in September and early October but the pace of growth decelerated since August.
  

• The USDA is reporting the first Asian soybean rust finding in Indiana, in addition to several new cases in Iowa and Missouri

• The U.S. Department of Energy said that:
  Supplies of crude oil rose 1.8 million barrels to 321.9 million barrels.
• Supplies of gasoline rose 2.8 million barrels
  Supplies of heating oil rose 1.2 million barrels.
  Refinery use fell from 87.8% to 87.3% of capacity.
  Gasoline demand fell 0.5% YoY
  Distillate demand rose 0.9% YOY
  The Strategic Petroleum Reserve increased by 500,000 barrels.
  
  

• The U.K.'s unemployment rate remained at 5.4%, down 0.2% YoY.
  
  

• The International Monetary Fund said that they expect world GDP to increase 5.2% in 2007 and 4.8% in 2008.

Life is harder now, some experts say

The basics, according to Warren, now take up close to three-fourths of every family's spending power (it was about 50 percent in 1973), leaving precious little left over at the end of the month — and leaving many families with no cushion in case of a job loss or health crisis.

Quick Overview

• Foreign investors slashed their holdings of US securities by a record amount as the credit squeeze intensified, according to the latest Treasury figures. Foreign investors sold $34.9 billion of U.S. securities in August while U.S. investors bought $34.5 billion of foreign securities. Overall $163 billion left the U.S. in August.
  
  

• U.S. industrial production was up 0.1% in September
  

• YoY consumer prices in the U.K. rose 1.8%.
  

• YoY consumer prices in the Euro area rose 2.1%.
  

• Canada met and kept its rate unchanged at 4.5%
  

• Manufacturing sales in Canada fell 1.7% in August
  

• Japan's housing starts fell 43% in August. The government began requiring stricter inspections to protect new homes from earthquake damage.
  

• Southern California home sales fell in September to the lowest level in two decades. It was the slowest month since the firm began keeping records in 1988, DataQuick said. The previous low was in February 1995 when 12,459 homes sold.
  

• Intel profits rose 43 %, beating estimates.
  
  

• There's been another round of new record highs for crude oil on fears of an escalating conflict between Turkey and Kurds in northern Iraq.
  

Quick Overview

• Federal Reserve Chairman Ben Bernanke said on Monday that a weaker dollar would have some inflationary impact but that expectations for slower growth may stem price rises.
  

• The New York Federal Reserve's regional index of manufacturing rose from 14.7 to 28.8 in October.
  

• Canada's index of leading indicators rose 0.4% in September.
  

• The World Trade Organization ruled the U.S. provides illegal subsidies to cotton growers, giving Brazil the right to impose sanctions on up to $4 billion worth of U.S. goods.
  

Quick Overview

• U.S. Producer prices rose 1.1% in September and 4.4% YoY.
  

• U.S. Retail sales rose 0.6% in September. Without transport sales rose 0.4%
  

• Industrial production in the Euro area rose 1.2% and 4.3% YoY.
  

• Industrial production in India rose 10.7% YoY.
  

• The USDA's 2007-2008 U.S. ending stocks estimate of:
  Corn increased from 1.675 to 1.997 billion bushels.
  Soybeans are unchanged at 215 million bushels.
  Wheat was lowered from 362 to 307 million bushels.
  Sugar increased from 1.802 to 1.899 million tons.
  Cotton increased from 6.2 to 6.4 million bales.
  

• The USDA's 2007-2008 world ending stocks estimate of:
  Corn increased from 105 to 110 million tons.
  Soybeans increased from 50 to 51 million tons.
  Wheat was reduced from 112 to 107 million tons.
  Cotton increased from 52 to 55 million bales.
  

• The USDA estimates the 2007-2008 Florida orange crop at 168 million boxes, up from 129 million boxes YoY. Juice yield is predicted at 1.60 gallons a box, down from 1.65 gallons per box YoY.
  

• The income gap between the wealthiest and poorest Americans grew to its widest level since the 1920s
  

• China's foreign exchange reserves, the world's largest, rose to $1.434 trillion in Q3.
  
  

Quick Overview

• The U.S. deficit in international trade of goods and services shrank 2.4%.
  

• Australia's unemployment rate fell from 4.3% to 4.2%.
  

• The International Coffee Organization kept its guess of 2007-2008 world production and consumption unchanged at 114 and 122 million bags.
  
  

• The U.S. Department of Energy said that:
  Supplies of crude oil supplies fell 1.7 million barrels to 320.1 million barrels
  Supplies of gasoline rose 1.7 million barrels
  Supplies of heating oil rose 1.0 million barrels
  Gasoline demand fell o.4% YoY
  Distillate demand rose 1.3% YoY
  Underground supplies of natural gas rose 73 billion cubic to 3.336 trillion cubic feet.
  
  
  
  

Quick Overview

• Consumer confidence in Australia fell 0.3%.
  
  

• The Baltic Dry Index passed 10,000 for the first time since its inception in 1985.
  

• Crude oil rose on speculation that Turkish forces may attack Kurdish rebels in northern Iraq
  

Global warming hits Cereal production hard
According to the first study on the impact of climate change on global food production from 1981 to 2002, fields of wheat, corn and barley throughout the world have produced a combined 40 million tonne less a year because of the increase in temperatures caused by human activities.

....”Most people tend to think of climate change as something that will impact the future, but this study shows that warming over the past two decades has already had real effects on the global food supply,” said Christopher Field, co-author of the study and director of Carnegie Institution's department of
global ecology.

Quick Overview

• The Dow and S&P 500 closed at records after minutes from the Federal Reserve's last meeting showed inflation expectations were contained, leaving open the question of whether another rate cut is near.
  
  

• Federal Reserve Bank of St Louis President William Poole said the deprecation of the dollar should not hit inflation, owing to the limited pass-through from the currency via import prices.
  
  
  
  

• India has extended its export ban of wheat for an indefinite period, while allowing the restriction-free import of wheat indefinitely .
  
  

• Heating oil customers will pay an average of 22 percent more this winter than last and natural gas customers will pay 10 percent more, the Energy Department estimated.
  
  

Study: GM corn might affect ecosystems
Assistant Professor Todd Royer said the study suggested pollen and other plant parts containing toxins from genetically engineered Bt corn are washing into streams near cornfields.
The researchers determined consumption of Bt corn byproducts produced increased mortality and reduced growth in caddisflies -- aquatic insects that are related to the pests targeted by the toxin in Bt corn.
Royer noted caddisflies are a food resource for higher organisms, such as fish and amphibians.
"If our goal is to have healthy, functioning ecosystems, we need to protect all the parts," said Royer. "Water resources are something we depend on greatly."

Quick Overview

• U.K.’s Producer prices rose 2.7% YoY.
  

• Factory orders in Germany rose 1.2%
  

EPA Asked to Regulate Ship Emissions
Marine vessels are responsible for nearly 3 percent of the world's greenhouse gases — equal to the amount generated by all cars in the U.S. — and ship emissions are projected to grow by more than 70 percent by 2020 as global trade expands, according to the petitions.

"If the U.S. is to do its part in reducing the threat of global climate disruption, then EPA must limit the global warming emissions from ships that enter the ports of the United States," Brown said.

Quick Overview

• U.S. jobless claims rose 16,000 last week to 317,000, more than expected.
  

• U.S. factory orders fell 3.3% in August.
  

• The Bank of England and the European Central Bank kept interest rates unchanged.
  

• Brazil predicted that the soybean crop will total 59.7 million tons in 2007-2008, up slightly from this year's harvest. They also predicted a 52.3 million ton corn crop, up from 51.0 million tons this year.
  

• The U.S. Department of Energy said that underground supplies of natural gas were up 57 billion cubic feet to 3.263 trillion cubic feet. Supplies are down 2% YoY.
  

• Canada estimated its wheat crop at 20.64 million tonnes, up slightly from the July guess of 20.3 million tonnes. This compares to 25.27 million tonnes last year.
  
  

• So far this year, Asian soybean rust has been found in 162 U.S. counties. More than likely not causing much damage to this year's crop.

Quick Overview

• The Institute of Supply Management said its index of services dropped from 55.8 to 54.8, about as expected.
  

• Democratic leaders in the U.S. Congress called for the appointment of a "mortgage czar" to help stem a jump in foreclosures.
  

• Australia's retail sales rose 0.7% in August.
  

• Retail sales volume in the Euro area rose 0.1% in August, and 1.0% YoY.
  

• Nine environmental groups called for annual investments of 1 billion reals to bring destruction of the Amazon rain forest to a halt by 2015.
  

• AWB Ltd. estimates the Australian wheat crop at 13 million tons.
  

• The U.S. Grain Council estimates China's corn crop at 139 million tons ( 5.5 billion bushels), down 6 million tons from last year.
  

• Brazils coffee crop needs rain, but the forecast is sunny and dry for the next ten days.
  
  

• The U.S. Department of Energy said that:
  Supplies of crude oil were up 1.2 million barrels to 321.8 million barrels.
  Supplies of Gasoline were down 100,000 barrels
  Supplies of heating oil down 200,000 barrels.
  Refinery use rose from 86.9% to 87.5% of capacity last week.
  Gasoline demand rose 0.1% YoY
  Distillate demand fell 0.4% YoY
  
  
  

Quick Overview

• The National Association of Realtors said that its pending homes sales index was down 6.5%
  

• The unemployment rate in the Euro area was 6.9% in August.
  YoY producer prices in the Euro area were up 1.7%.
  

In Wiki-Politics, Ron Paul and Mike Gravel Lead the Field
At this time during the run up to the last presidential election, Wikipedia was in its infancy. In July of 2003, the online encyclopedia attracted less than half a million US visitors. Fast forward four years. In July of 2007 over 41 million people, or 1 in 4 people online in the US, visited the site. Wikipedia is now the 12th most visited website and is likely to play a significant role in informing and influencing those who will choose our next president.

Quick Overview

• The Institute of Supply Management's U.S. manufacturing index dropped from 52.9 to 52.0 in September.
  
  

• Japan's Tankan index was unchanged at +23 in September, better than expected
  

• Manufacturing in Europe fell from 54.3 to 53.2 in August.