The Google search bar helpfully tries to autofill when you’re doing a search. Start typing in the letters h and a and it prompts “haute couture” and “Harry Potter.” I assume this based on the frequency of other searchers’ terms.

Start typing in Geithner, and this is what it prompts:

Is that really what Google searchers are most interested in?

Google’s documentation explains: “As you type a search query into the new Toolbar’s search box, you’ll see a list of useful suggestions based on popular Google searches, spelling corrections and your own Toolbar search history and bookmarks.”

Looking at the results for the “Geithner jewish” search, the fifth is to another blogger’s previous observations on the same disturbing trend.

Mashing up two of the fastest growing phenom of our time: http://twitter.com/nationaldebt.

Why would anyone buy low-yield fixed income securities when we know governments around the world are preparing to unload trillions of the things? Bonds are going to be priced like sand at the beach. If you’ve got the bucket — take as much as you want. It looks like UK buyers are starting to rebel as the government starts selling “gilts” as the UK government bonds are called. Bloomberg reports:

U.K. gilts slumped after demand at an auction of bonds fell short of the amount offered, the first time the Treasury failed to attract enough bids at a sale of regular debt in 14 years.

Investors bid for 1.63 billion pounds ($2.4 billion) of the 40-year securities, less than the 1.75 billion pounds of 4.25 percent notes slated for sale, the U.K. Debt Management Office said today in a statement from London.

“Basically it’s the first failed auction,” said John Wraith, head of sterling interest-rate strategy at RBC Capital Markets in London. “They didn’t receive enough to cover it all so the market has obviously sold off extremely heavily.”

The yield on the 10-year gilt jumped 10 basis points to 3.43 percent by 11:45 a.m. in London. The 4.5 percent security due March 2019 slipped 0.84, or 8.4 pounds per 1,000-pound face amount, to 109.02. The yield on the two-year note rose six basis points to 1.30 percent. Yields move inversely to bond prices.

In my thirty years of watching the US treasury market, we’ve never had a failed auction in the US. How long before we see one?

Bloomberg:

The 8.875 percent 30-year bond that the government sold in February 1989 yields 0.44 percentage point, or 44 basis points, more than the current 10-year 2.75 percent note, which is the most comparable security and yields 2.89 percent. That amounts to about $44,000 a year in interest on a $10 million investment.

In laymen’s language: current buyers of US treasuries are not long-term investors, but flight-to-quality money-stashers. Not a sound base for an rate curve and a sign of much higher rates to come. And higher rates mean fewer home buyers & slower economy.

Madoff “lost” or “stole” $65 billion. That’s the headline of the day.

How is that possible when Madoff hasn’t even been trading for at least 15 years?

More likely Madoff “redistributed” $65 billion in the form of dividends and cash distibutions to investors.

Or, the bulk of the $65 billion is bogus paper profits. But you can’t really lose money that never really existed, right? (If I wrote you a check for $5 million and it bounced, would we say you’d “lost” $5 million?)

In the week ending March 7, the advance figure for seasonally adjusted initial claims was 654,000, an increase of 9,000 from the previous week’s revised figure of 645,000. The 4-week moving average was 650,000, an increase of 6,750 from the previous week’s revised average of 643,250.

Japan is worse? Bloomberg:

The world’s second-biggest economy shrank an annualized 12.7 percent last quarter, the government said Feb. 16, the biggest contraction since the 1974 oil crisis. Capital spending excluding software dropped 18.1 percent in the three months ended Dec. 31, the seventh quarter of declines, a separate government report showed on March 5.

A Cabinet Office report on March 11 may show machinery orders slumped 40.2 percent in January from a year earlier, according to a Bloomberg News survey.

Signs of a deepening recession dragged the Nikkei 225 Stock Average down 5.2 percent this week. Ten-year yields had a correlation of 0.7 with the Nikkei in February, Bloomberg data show. A value of 1 would mean the two moved in lockstep.

“While falling stocks normally push yields down, we need to be alert to the risk that Japanese financial institutions, which suffered heavy equity losses, will sell bonds to generate profits before the fiscal year ends this month,” said Chotaro Morita, chief strategist at Barclays Capital Japan Ltd. in Tokyo. “Such selling of bonds may emerge as the Nikkei 225 comes closer to or falls below 7,000.”

Of course, Japanese banks own plenty of US bonds too. How high do US long term yields go when UST cancels auctions of TIPS, the inflation adjusted security, and tries to sell 100 billion worth of 30 year bonds — 15%? Unless of course, the Fed prints more money and buys the bonds itself.

More assurances that there’s nothing to worry about in Hungary.

Hungary PM says bank deposits are safe, guaranteed

BUDAPEST, March 6 (Reuters) – Hungarian bank deposits are safe and the government provides a comprehensive guarantee for client deposits, the prime minister said on Friday.

‘We have made very important steps (during this crisis). It is a very big thing that depositors in Hungary need not worry,’ Prime Minister Ferenc Gyurcsany told a meeting of business leaders.

‘They can be safe during a global financial crisis,’ he said.

Gyurcsany also said the government was ready to consider deeper and more comprehensive reforms than the measures laid out last month.

It’s a truism among money market mavens that any bank that has to proclaim its health is almost dead.

So it is with great sadness that I read this story tonight, datelined 03.05.09, 05:56 PM EST.

Hungary cbank, regulator say bank system stable

BUDAPEST, March 5 (Reuters) – Hungary’s central bank (NBH) and financial market regulator PSZAF said on Thursday that the financial situation of banks in Hungary was stable and bank clients’ money was safe.

‘The Hungarian central bank and PSZAF are closely monitoring the situation of banks,’ the bank’s spokeswoman Nora Hevesi and PSZAF spokesman Istvan Binder told Reuters.

‘The financial situation of the Hungarian banking system is stable, the money of depositors is in safety,’ they added.

The forint, having traded at 300 to the Euro just a week ago and having closed today in Budapest at 309 to the Euro is at 315 tonight.

Make that 316.

I got to know Andras Simor, the guy who today runs Hungary’s central bank, in the 1990s when I was living in Budapest and writing about business in the former Soviet bloc. Simor ran the securities arm of Creditanstalt Securities and was always generous with his insights.

Simor is in a tough spot now, because every currency speculator in the world is trying to bludgeon the IMF’s $15.7 billion loan out of his vaults and into their own wallets.

A devaluing forint hurts Hungarians who’ve borrowed avidly in Euros and Swiss Francs. And it puts great pressure on the banks in Europe (Creditanstalt being high on the list) who have loaned this money. The dominoes are tumbling.

(For Blogads’ business partners, it’s worth noting that this craziness is benign: Hungary’s tailspin means Budapest staff get paid more in local terms and we can hire more great programmers.)

I’d missed this passage in Warren Buffett’s annual report:

This debilitating spiral has spurred our government to take massive action. In poker terms, the Treasury and the Fed have gone “all in.” Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once-unthinkable dosages will almost certainly bring on unwelcome aftereffects. Their precise nature is anyone’s guess, though one likely consequence is an onslaught of inflation. Moreover, major industries have become dependent on Federal assistance, and they will be followed by cities and states bearing mind-boggling requests. Weaning these entities from the public teat will be a political challenge. They won’t leave willingly.