STOCK MARKET WATCH, Friday 4 August

[ozymandius]

Friday August 4, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 901 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2050 DAYS
WHERE'S OSAMA BIN-LADEN? 1750 DAYS
DAYS SINCE ENRON COLLAPSE = 1711
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54


U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON August 3, 2006

Dow... 11,242.59 +42.66 (+0.38%)
Nasdaq... 2,092.34 +13.53 (+0.65%)
S&P 500... 1,280.27 +1.72 (+0.13%)
Gold future... 657.00 -7.10 (-1.08%)
30-Year Bond 5.04% -0.02 (-0.32%)
10-Yr Bond... 4.95% -0.01 (-0.20%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[Sven77]

1. mislabel

its not October...

[ozymandius]

3. thanks

That's what I get for being late and in a hurry.

:hi:

[RawMaterials]

24. Or Maybe Ozy is trying to tell us something about

october 4th :tinfoilhat:

:hi:

spill the beans ozy what do you know that we don't.

[ozymandius]

67. Bush will be photographed wearing mascara.

And the Dow will drop by 6,000 points. Eeverything else will collapse as Nasdaq and S&P devotees cover their losses. But then -- I'm just talking outta my ass.

Them's beans for ya.

[ozymandius]

2. WrapUp by Martin Goldberg

WHILE MARKET INTERNALS CRUMBLE, IS PRICE NEXT?

There are countless ways of describing the deterioration of stock market internals, yet internals are only internals until they become the signs of a crumbling stock market. For most people, this occurs only in hindsight. For those using internals to look forward there is the pitfall of saying (with feeling) “Ah-Ha, this crumbling ‘internal’ is a sign of a stock market doomed to failure!” While this may now be true, the time frame for failure may be longer than most folks expect. The bullish predisposition of today’s market and preponderance of hope in the market is typified by the action of General Motors (GM) common stock. A stock market that can be led by a company sporting GM’s current (lack of) fundamentals is capable of doing practically anything in the intermediate term. These were my thoughts and suspicions going into this week, and they were further solidified by this lucid article.

To summarize my thoughts, this is a market containing crumbling internals which is capable of doing almost anything in the intermediate term. From a trading perspective, this requires great care, risk management, and patience. If the internals are signaling a new intermediate bearish trend, I’d want to be following the young trend; yet prudence requires care of entry and exit points because recent experience has shown that any stock or sector is capable of becoming the next GM, even homebuilders.

Bullish Percent, a deteriorating market internal, is described in Stockcharts.com:

“The Bullish Percent Index (BPI) is a popular market breadth indicator that is calculated by dividing the number of stocks in a given group (an exchange, an industry, etc.) that are currently trading with Point and Figure buy signals, by the total number of stocks in that group. Bullish Percent levels that are above 70% are considered overbought, whereas levels below 30% are considered oversold. Strong buy signals occur when the Bullish Percent Index falls below 30% and then reverses up by at least 6%. Conversely, promising sell signals occur when it goes above 70%, and then reverses down by at least 6%. The most popular version of this chart is the NYSE Bullish Percent ($BPNYA) which is mentioned prominently in Thomas Dorsey's book, Point & Figure Charting however it is important to remember that the Bullish Percent index can be calculated for any grouping of stocks.”

-cut-

Today’s Market

There’s more internals to discuss that pertain to today’s action. Whereas the Nasdaq composite traded higher on significantly lower volume than yesterday, the NYSE composite traded about even on significantly higher volume than yesterday. That shows another (small) sign of deteriorating market internals. But until the internals are confirmed by price action, they are only “internals.” Today’s leading indices included transportation, technology and perhaps the next General Motors – homebuilders. The point is that the recent lagging indices led the market higher today. The bear-market laden Dow Jones US homebuilder index was up over 5%.

http://www.financialsense.com/Market/wrapup.htm

[ozymandius]

4. Today's Reports

8:30 AM Average Workweek Jul
Briefing Forecast 33.9
Market Expects 33.9
Prior 33.9

8:30 AM Hourly Earnings Jul
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.5%

8:30 AM Nonfarm Payrolls Jul
Briefing Forecast 135K
Market Expects 145K
Prior 121K

8:30 AM Unemployment Rate Jul
Briefing Forecast 4.6%
Market Expects 4.6%
Prior 4.6%

[stop the bleeding]

10. Here are some of the numbers for Reports

By Greg Robb, MarketWatch
Last Update: 8:30 AM ET Aug 4, 2006


WASHINGTON (MarketWatch) - U.S. job growth continued at its lukewarm pace in July, the Labor Department said Friday.
U.S. nonfarm payrolls rose by 113,000 in July after a revised 124,000 gain in June, the agency said.

Economists surveyed by MarketWatch were expecting payroll gains of about 143,000 in July. See Economic Calendar.
The unemployment rate rose to 4.8% in July from 4.6% in June. This is the highest level since February.

Average hourly earnings rose 0.4% and are up 3.8% year-on-year. Economists had been expecting a 0.3% gain in earnings.

Economists have viewed the July nonfarm payroll report as critical piece of the puzzle over whether the Fed will hike rates again or pause on Aug. 8. The sluggish pace of job growth and the rise in the unemployment rate may give the Fed room to pause after 17 straight meetings with a rate increase.

The gain in payrolls is in line with the average job growth of 112,000 in the second quarter. This is a slower trend than the 176,000 job pace in the first three months of the year.

In July, goods-producing industries lost 2,000 jobs while private-sector service-producing jobs gained 115,000.

Within services, retail jobs were flat after three straight monthly declines.

The biggest gain was in professional services which added 43,000 jobs.

The manufacturing sector lost 15,000 jobs in July, reversing a gain of 22,000 in the previous month.

Construction employment rose by 6,000 in July, the first increase in the past three months.

Among 278 industries, 53.2% were adding employees in July. Among 84 manufacturing industries, 45.2% were adding jobs.

Average hourly wages rose 7 cents or 0.4% to $16.76. Average hourly earnings are up 3.8% in the past year. June wage gains were revised down to a 0.4% gain, compared with the initial estimate of a 0.5% increase.

The average workweek was steady at 33.9 hours. Within manufacturing, average hours rose to 41.5 from 41.3 in June. Factory overtime was down 6 minutes to 4.5 hours.

Total hours worked in the economy rose 0.1% to 105.2. The manufacturing index rose by 0.4% to 97.3.

In a separate survey of households, the Labor Department found that unemployment jumped by 248,000 in July. Employment fell by 34,000, while 29,000 dropped out of the workforce.

Payrolls in May and June were revised higher/lower by a total of xx,000. June's payrolls, which had originally been reported as an increase of 121,000, rose by xx,000 in the latest revision. Payrolls increased by xx,000 in May, up/down from 92,000 estimated earlier.

Retail sales down three consecutive months



http://www.marketwatch.com/news/story/Story.aspx?guid=%7BFB773CD7%2DB1DE%2D4469%2DBD4B%2DE864F001D222%7D&siteid=

[54anickel]

13. And the markets rejoice!

Stocks ready to rally
Weaker-than-forecast July jobs report fuels optimism about a halt to more interest rate hikes

http://money.cnn.com/2006/08/04/markets/stockswatch/index.htm

NEW YORK (CNNMoney.com) -- Stocks looked set for a gain at the open Friday after the July employment report came in weaker than expected, thereby boosting investor optimism that the Federal Reserve might halt its rate-hike campaign.

S&P futures, and Nasdaq futures reversed course and headed higher immediately following the jobs numbers.

snip>

The Fed is due to meet Tuesday and, for the first time in a while, financial markets aren't sure what central bank policymakers will do at the meeting. Another rate raise would bring the Fed's target for a key short-term interest rate to 5.50 percent. (Full story)

Interest rate futures are pricing in a less than 50 percent chance that the Fed will raise rates again Tuesday.

"There's a lot of nervousness because the market has been trading on that expectation," said Anthony Chan, chief economist with JPMorgan Private Client Services.

more...

[ozymandius]

5. Oil prices continue to fall in Asia

SINGAPORE - Oil prices continued to fall Friday as concerns eased that a tropical storm blowing through the Caribbean could damage oil facilities in the Gulf of Mexico.

Light sweet crude for September delivery dropped 21 cents to settle at $75.25 a barrel in midmorning Asian electronic trading on the New York Mercantile Exchange.

September Brent crude was down .15 cents at $76.41 a barrel at London's ICE Futures exchange.

Prices in recent days had largely been driven by fears that Tropical Storm Chris could become the first major hurricane of the season and affect Gulf Oil facilities. But forecasters said the storm was weakening as it swept through the eastern Caribbean.

more

[ozymandius]

6. 3 Filipinos workers kidnapped in Nigeria

PORT HARCOURT, Nigeria - Three Filipinos working for a U.S. construction firm were kidnapped in southern Nigeria early Friday, a day after a German was abducted in a region where the handling of oil revenue has caused strife between multinational companies and local communities.

Four armed men blocked the vehicle of the Baker Hughes Inc. employees on the road, fired in the air and then took them hostage, according to a colleague who spoke on condition of anonymity because he was not authorized to talk to the press.

State police spokeswoman Irejua Barasua confirmed the kidnapping.

more

[ozymandius]

7. Iran says oil may hit $100/barrel

NEW DELHI (Reuters) - Iran's Deputy Oil Minister Mohammad Hadi Nejad-Hosseinian said on Friday global crude oil prices could touch $100 a barrel on geopolitical tension and soaring winter demand.

"There is still a possibility of crude reaching $100 a barrel due to geopolitical problems worldwide and peaking of winter demand," the minister, in the Indian capital for two days of talks on a proposed $7 billion gas pipeline, said.

He did not see the possibility of Iran withdrawing crude supplies from global markets in the event of U.S. military action against Tehran over its controversial nuclear program.

Concerns over Iran persisted as its president, Mahmoud Ahmadinejad, insisted on the country's right to produce nuclear fuel, despite a United Nations resolution demanding that Tehran suspend its nuclear activities by August 31 or face the threat of sanctions.

more

[4dsc]

52. $200 a barrel by 2010

Simmons says officially published reserves numbers for the Middle Eastern countries are obviously bogus.

"The proven reserves, which used to be reported on a detailed, field-by-field basis disappeared, rolled up into just country-by-country. Over the period of the first eight years of the 1980s, all of the Middle East oil producers tripled the amount of proven reserves they said they had. And then, effectively, country-by-country, the number stayed still. It never changed from 1987-88 to 2005; and nobody ever said, What's going on? How do you basically keep producing 15-20 million barrels a day out of the Middle East and the proven reserves never change?"

[ozymandius]

8. Good morning all.

:donut: :donut: :donut:

It's another short day for me as I got here late and must leave early.

It's good to see AnneD back. Anne, you've been missed.

Have a great day and may you make a few pennies at the Casino.

Ozy :hi:

[AnneD]

30. Morning Marketeers,

:donut: and lurkers. Thanks Ozy :hi:. I missed you guys too. When you don't have this thread as a reality check....it is easy to see how some folks think that every thing is coming up roses (cue Ethel Merman for me).

I am going to report a few tid bits of cheery news today. These are not stories that you will hear about, they are back page if at all (there were NO celebraties involved).

1) One of the GOOD things to come as a result of the hurricane season last year is that coastal wildlife are having a great year. Seem a lot of nasty things were swept out/filtered/turned over. We haven't seen any O2 dead zones, and that's a good thing.

2) The hurricane season is less active this year. I figured when we had a cooler than normal Spring this year that the prognosticators for the hurricane season were wrong. The Gulf cooled down a bit and the wind patterns have been kind to us down here. Unfortunantly, every one else (Midwest and northeast) has been getting the heat that is usually reserved for the Southwest and Gulf Coast states in the summer. We will still have them no doubt-but it will be a more normal season.

3) The teacher's union in Texas flexed their muscles. Every since the redistricting (illegal no matter WHAT the SCOTUS says), the GOP in the Texas Leg. has been insufferable and rude to boot. One particular high profile mouthpiece was so anti teacher anti public education that he was targeted (along with 16 others) in the TFT's educator to voter campaign. TFT members hand wrote cards and letters to educators in the Representitives' districts. When the dust settled, 15 of the 17 Reps were voted out-but the sweetest victory (and the one that had the others pissing in their boots-was the rude mouthpiece). Chris Bell spoke to our union stewards meeting. We are backing him here in Houston. He will be a refreshing change. Govoners in Texas don't have much power...but they can veto stupid laws. Chris seems to be smart and his heart is in the right place. Goodness we haven't had a good Gov. since Anne Richards.

4) Today marks the start of the tax free weekend. Clothing and shoes that are under $100 are tax free. This helps parents buy kids school clothes. Wish they would include school supplies. This is such a popular program that folks from the surrounding states cross the border to get school clothes during this time. It is a small respite for the working and middle class.

Happy hunting and watch out for the bears.

[Buttercup McToots]

9. A possible look forward...

I posted this last night but with so much hoopla going on it never got looked at.
I find the article interesting and a portent of things to come.

link:
http://www.321gold.com/editorials/orlandini/orlandini080306.html

Snip>
Why would anyone want to go down such a dangerous road? Well, for the US a lot of it has to do with oil whereas for Israel it would be a chance to settle some old scores once and for all. I have no idea who threw the first stone in the Middle East some three thousand years ago, but if George Jr. is dumb enough to start dropping nuclear ordinance on the Arabs, and I think he is, you will be fighting the next war throwing stones from your respective caves2. Anyone who thinks China and Russia will sit quietly by while the US goes about the confiscation of +/- 50% of the world's oil is more than a few bricks shy of a full load. So far they have been content to let America kill innocent men, women, and children in Iraq and Afghanistan, all in the name of democracy, because they know full well it's a war we can't win. Russia can write volumes about going down to defeat in Afghanistan. The implementation of nuclear weapons changes all that, even low grade nuclear weapons, as the Arab nations would be powerless to fight back. At least over the sort run. Over the run long the United States would reap what it sows as the Al Qaeda would find some way to explode a nuclear weapon on American soil. It's worth remember that throughout the course of human history, whenever a bully has started throwing stones, someone eventually comes along with a bigger stone. The process of retribution often takes years, or even decades, but it inevitably happens. Mr. Bush will find that out the hard way.

snip>
MARKET COMMENTARY

It has been an interesting month to say the least. The DJIA was suppose to rally to new highs and never did while gold was suppose to fall to new lows and didn't Bonds and the dollar stayed range bound while the CRB is making noises like it wants to break out to the upside. To me it all smacks like the calm before the storm. The calm could drag on for another month or two but look out in October and November as history looks like its going to repeat itself. Let's take a look:




snip>
The markets remind me of a kid I knew years ago. He used to drive like a bat out of hell. One day we were traveling together, he was driving, and I dosed off. I woke up an hour later, looked at the speedometer which was pegged at 120 mph, and asked where the hell we were at? He responded "I don't know, but we're making great time!" There's a wreck coming, it will take place in the Middle East, and it will be very, very bad. Try to protect yourself as best as possible.

[54anickel]

17. I caught that one yesterday, I'm not so sure I have his confidence

of a rosy rebuilding of America. We as a nation have become much more self-centered, greedy, arrogant and very divided politically, economically, and spiritually. He even hints to that "pull yourself up the bootstraps" "I've got mine, go get your own" American mentality.

America lost her heart and sense of humaneness long ago. Remember the neocons have their roots in being disenchanted liberals, and what we are now witnessing is the end result of their effect and empowerment in the Republican controlled Congress since the Ray-gun days. Payment for Newt's Contract on America has come due.

We've been on the edge before, and cooler heads have always prevailed, but I just can't get past the feeling that this time is different. There are very few people in Congress, the Senate, and the White House who have suffered hard times. The few that exist, like Charles Byrd from West Virginia, seem to have given up. Kennedy isn't even the shadow of his brother Robert, but given what happened to his family, I suppose it's understandable. He learned the hard way that you just don't tilt against windmills. I had high hopes for McCain but he seems to have chosen a different path. He ceased being an individual and became a politician somewhere along the way. If I'm right and government fails the people, where do you turn to? How does one protect himself from the four horsemen? Personally, I only see one way out. Any and all improvement, and there will be improvement, will be on an individual level. Institutions and political parties will be of little or no help. Don't forget that America began with just fifty-four individuals locked in a room, ready to sacrifice everything, in order to build a republic. They succeeded. The same thing happened with the Depression and World War II, and will happen again as there will be some individuals who will step to the front, lead by example, and leave the country a better place. The US will not go the way of Rome and Carthage, at least not yet. The pain and suffering that I see on the horizon will leave the US a much better place. The United States will become a Republic again, as it was intended to be. But as usual, there will be a big price to pay.

[Buttercup McToots]

23. Good Morning, 54anickel

After I read your reply, I had to turn to inward reflection, and found that I still believe in the people...the heros...the cause...liberty...justice. Guess that I am still optimistic for the future.
The breaking of this current system has to happen...it is riddled with rot from within.

"America lost her heart and sense of humaneness long ago." you say...
I believe it was hijacked when people became complacent.
I read all the posts on this messageboard and many others. America's heart is her people and the principals of her beginning and I read/see/hear that louder and louder as more and more people find their way to places like the Democratic Underground.

I do believe that we are on the edge of a cliff and that it will take a fall off that cliff to get some couch potatoes to wake up to what has been going on around them...

That's me
The Eternal Optimist
Buttercup McToots

[54anickel]

25. I hope your are correct B. McToots. I hope folks are waking up, and

that somehow we are actually a silent (more likely a silenced) majority. I guess I'm just not seeing it here in my neck of the woods (WI, that once great bastion of progressives is quickly being overrun by the Newt-type Republicans and "fundies"). It's getting scary around here. While I have been able to turn once strong Bush supporters around on Bush, they still hang on to their "hatred" of Democrats and what they call "Lib-a-rils".

In a way, the waking of couch potatoes scares me. Look at what has been filling their noodles all these years while they were lounging in front of that "idgit box". Isn't that how we got stuck with the Contract on America to begin with? Now we have couch AND pew potatoes.

I will continue to seek out signs of an optimistic awakening. There are glimmers here and there on the "internets", hopefully they will make their way more and more into the mainstream.

But that's just me.
The Eternal Pessimist striving to become an Optimist ;-)

[54anickel]

11. Dollar Watch

By the gold and currency charts above, I take it the buck got hit by the employment reports, but there's that 20 minute lag....

http://quotes.ino.com/chart/?s=NYBOT_DX&v=s

Last trade 85.19 Change +0.10 (+0.12%)

Settle Time 15:00 Open 85.10

Previous Close 85.09 High 85.27

Low 85.02 2006-08-04 08:19:45, 30 min delay

52wk High 92.63 52wk High Date 2005-11-16

52wk Low 83.6 52wk Low Date 2006-05-15


The September Dollar was higher due to short covering overnight as it consolidates some of this week’s decline. Stochastics and the RSI are becoming oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If September extends the decline off July’s high, the reaction low crossing at 84.42 is the next downside target. Overnight action sets the stage for a steady to higher opening in early-day session trading.


Dollar steady ahead of US jobs data

http://biz.yahoo.com/ft/060804/fto080420060704453089.html?.v=1

The dollar steadied on Friday ahead the US employment report as investors wait for any indications the data may give on whether the Federal Reserve will raise interest rates for an 18th straight time next week.

The euro failed to gain much support on Thursday from the European Central Bank raising interest rates by a quarter point to 3 per cent.

As to non farm payrolls, economists forecast a 142,000 increase for July, up from June's 121,000.

Unless the figure comes in very strong, expectations were seen increasing that the Fed will pause its monetary tightening.

The dollar gained 0.2 per cent against the Japanese yen to Y115.31, but was flat versus the euro at $1.279 and lost 0.1 per cent on the pound to $1.8911.

more...


GLOBAL MARKETS-U.S. jobs data boosts stocks, bonds, hits dollar

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-08-04T124146Z_01_L04111610_RTRIDST_0_MARKETS-GLOBAL-JOBS-URGENT.XML

LONDON, Aug 4 (Reuters) - Surprisingly weak U.S. jobs data boosted stocks, raised demand for government bonds and weakened the dollar on Friday as investors bet the data could stop the U.S. Federal Reserve from raising interest rates next week.

The U.S. Labor Department said non-farm payrolls rose just 113,000 in July and the jobless rate increased to 4.8 percent from 4.6 percent a month earlier.

Economists polled by Reuters had expected a 142,000 rise while derivative traders bet on around 149,000 just before the data's release.

snip>


The 10-year Treasury <US10T=RR> yield was 5.4 basis points lower at 4.909 percent, while the 10-year Bund yield <EU10YT=RR> was down 2.8 basis points at 3.939 percent.

bit more...

[54anickel]

16. A peek at the buck now that it's starting to catch up in time here....

The chart shows the steep cliff.

http://quotes.ino.com/chart/?s=NYBOT_DX&v=s

Last trade 84.60 Change -0.49 (-0.58%)

Settle Time 15:00 Open 85.10

Previous Close 85.09 High 85.27

Low 84.56 2006-08-04 09:08:36, 30 min delay

[54anickel]

27. Whoopsie, looks like another tumble for the buck....

Last trade 84.44 Change -0.65 (-0.76%)

Settle Time 15:00 Open 85.10

Previous Close 85.09 High 85.27

Low 84.43 2006-08-04 09:59:02, 30 min delay

[54anickel]

38. No "Surprise" To Us! ....Today's Pfenning

http://www.kitcocasey.com/displayArticle.php?id=871

snip>

Well... The Bank of England (BOE) and the European Central Bank (ECB) both did as I thought they would yesterday and raised rates 25 BPS respectively. As I was signing off yesterday, the BOE had wet their powder, and the pound sterling was soaring... So, let's talk about that rate hike first.

The headlines read.... "The Bank of England Surprises The Markets With A Rate Hike" Surprised? Well... I guess anyone that doesn't read the Pfennig might have been "surprised"... We certainly were not, as I had chronicled the sizzling growth, and inflation pressures for the past few months... Anyway... The pound sterling continued its flight to higher ground all day after the announcement, and the statement afterward which left the door open to further hikes.

Pound sterling also got a boost from a story in the U.K. papers yesterday that the Bank of Italy had cut the U.S. dollar portion of its reserves by 21% while increasing its pound sterling portion from 0% to 24%. There were no actual hard numbers discussed... But one would have to figure that we're talking about something that's larger than a breadbox! Pound sterling seems to be stealing the spotlight from the other European currencies right now... Pretty interesting, eh?

Later in the morning, yesterday, the ECB walked the walk, after talking the talk all month about higher interest rates. The euro received little support from the announcement, as I said yesterday that I had thought the rate hike had already been priced into the euro's value. I was, and the markets were, concerned about ECB President Trichet's press conference afterward... Would he back off his mega-hawk stance, or remain dedicated to fighting crime, and seek truth, justice and the American way..... Wait, he's no Superman! But seriously... What would he say?

Well... Grasshopper... Trichet remained a central banker that the inflation hawks can be proud of! How about these two comments from Trichet... "Monetary policy remains accommodative". And... "Progressive withdrawal of accommodation warranted" Ok... For those of you new to Central Bank parlance... Basically Trichet said that rates were still accommodating, which means low... And that, and I loved this statement... "progressive withdrawal of accommodation warranted"... Which means, he feels that he will continue to remove the low rates, and do so with a 50 BPS hike in his back pocket to pull out anytime he believes it necessary to do so.... There! Hope that helps!

more...

[Ghost Dog]

47. Hmm. Let's see, today's watch on Swiss Franc (CHF), Pound Sterling (GBP)

Vaya, vaya.

[54anickel]

12. Apple Shares Fall as Options Lead to Restatement

http://www.bloomberg.com/apps/news?pid=20601087&sid=a6DntXKI55LU&refer=worldwide_news

Aug. 4 (Bloomberg) -- Shares of Apple Computer Inc., the maker of Macintosh computers and iPod music players, fell after the company said it will probably restate earnings following an internal investigation into options backdating that found more suspicious grants.

The stock traded at the equivalent of $63.85 at 9:08 a.m. in Germany, down 8.2 percent from yesterday's closing price on the Nasdaq Stock Market. Before today the stock had declined 3.2 percent this year.

Apple is among the most prominent companies embroiled in the stock-option scandal that has unfolded across Silicon Valley. The Cupertino, California-based company said in June it was investigating stock-option grants from 1997 to 2001, including an award to Chief Executive Officer Steve Jobs. That announcement caused the stock to drop 2.9 percent the next day.

``We know it's significant, we just don't know how significant,'' said Rob Enderle, an analyst at San Jose, California-based Enderle Group. ``We're going through what appears to be a very painful process of rediscovering how to account for certain things that were done about five years ago.''

The company said yesterday after U.S. markets closed that will delay its quarterly filing with regulators while it continues a review. Apple said it hasn't determined the size of the charge it will likely take to account for stock options, or which periods need restating.

more...

[54anickel]

20. Apple finds more evidence of options irregularities

"Irregularities" phfft! What the hell does that mean anyway? I tend to associate that word with products involving bowel movements. Hmmmm, perhaps it is the best choice of words afterall. Don't take this as a rip on Apple, it's this whole fiddling with the dates of options that stinks to high heaven. It seems to be quite wide-spread. Once again, like off-shore tax-havens, there are no ethical questions involved - just bottom line "is it legal". Seems to work as a defense for Bush, Cheney, Rummy and the rest of their gang these days. :eyes:

Had to post this one just for the headline and the tiny little snippet from the end of the article.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B960B1ACF%2D8289%2D4CE6%2DAA42%2DC3031DF643CE%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

snip>

The recent concerns about options could provide a buying opportunity for less-squeamish investors, some observers note. Unlike the scandals at Enron and WorldCom, which went bankrupt, alleged options accounting issues have not aimed to mask underlying weakness in fundamentals. See full story.

Wonder how many companies listed in the "Socially Responsible" labeled funds practice this options game? Should they be? Just what is social responsibility these days anyway and are their any major corporations that "walk the talk"?

[54anickel]

14. Secret of the Up-or-Holding Rate: Tuesday's Fed Mystery Theater

http://www.washingtonpost.com/wp-dyn/content/article/2006/08/03/AR2006080301484.html

Federal Reserve policymakers haven't provided a wink, a nod or even a coded phrase to telegraph what they plan to do with interest rates when they gather Tuesday -- the first time in three years the outcome has been uncertain so close to their meeting.

The reason, analysts say, is simple: Fed members themselves don't know, with some pressing for the 18th consecutive increase in interest rates and others ready for a break.

But the situation reflects something more: a shift in the Fed's communications strategy. Instead of providing short-term guidance about interest rates, the new chairman, Ben S. Bernanke, is highlighting a long-range view of where he wants the economy to go over 18 months or longer.

That contrasts with the practices of his predecessor, Alan Greenspan. In his last 2 1/2 years as chairman, Greenspan sent clear signals ahead of time to prepare financial markets for Fed decisions on interest rates. Bernanke continued that policy when he took over in February.

If Bernanke sticks with the new approach, stock and bond investors will have to do a lot more guesswork about where interest rates are headed.

more...

[54anickel]

15. Stock buybacks spike along with bad news

http://today.reuters.com/news/articlenews.aspx?type=reutersEdge&storyID=2006-08-03T213254Z_01_N03621873_RTRUKOC_0_US-MARKETS-STOCKS-BUYBACKS.xml

NEW YORK (Reuters) - Stock buybacks aren't what they're cracked up to be.

While Corporate America is spending billions of dollars on repurchases, they are doing so as companies report disappointing quarterly results amid already sagging share prices.

"Buybacks are certainly not a buy signal" for investors, said Nicholas Colas, director of research at Rochdale Research in New York.


"What we are seeing is an indication that companies see slower economic growth and don't want to risk huge capital expenditures if that unfolds."

While it may prove prudent that companies are repurchasing their shares in the current environment, it doesn't mean they are doing so at the cheapest price.

"A rush of stock buybacks tends to be a sign of a market top, not a market bottom," Colas said.

more...

Heh-heh, when Ozy was questioning whether or not to keep the Enron numbers I was going to suggest tracking buyback announcements instead - but there'd be no easy way to do it. :evilgrin:

[RawMaterials]

42. isnt this a way for the execs that hold a lot of stock

a chance to dump the stock at a set price back to the company???

[54anickel]

43. Well, sometimes it works out well for them. Timing is everything.....

U.S. Bancorp's Grundhofer to cash in $108M in options

U.S. Bancorp CEO Jerry Grundhofer, who will retire in December, plans to liquidate options to buy 3.36 million shares of stock, worth nearly $108 million.

Grundhofer, who last month said he would retire from Minneapolis-based U.S. Bancorp, would see his options expire if he didn't exercise them before Dec. 2007, the company said in a securities filing Thursday.


Under the plan, Grundhofer will exercise stock options for a total of 3,362,712 shares of U.S. Bancorp common stock and sell one-fifth of such shares each quarter for five successive quarters, beginning this quarter. The sales will occur over a three-day period beginning three trading days after the public release of U.S. Bancorp's quarterly or annual financial results.

The exercise prices for the options range from $18.79 to $21.54 a share, allowing Grundhofer to buy shares for about one-third less than Thursday's closing price of $32.17. Assuming he then sells the shares and U.S. Bancorp's stock price stays about $32, that will mean Grundhofer will clear at least $30 million in the deal.



US Bancorp to buy back up to 150 mln shares
http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-08-03T151410Z_01_WEN3277_RTRIDST_0_FINANCIAL-USBANCORP-BUYBACK-URGENT.XML&rpc=66&type=qcna

NEW YORK, Aug 3 (Reuters) - U.S. Bancorp (USB.N: Quote, Profile, Research), the No. 6 U.S. bank, on Thursday said its board of directors authorized it to buy back up to 150 million common shares by the end of 2008.

The buyback is equivalent to about $4.79 billion of stock, based on U.S. Bancorp's Wednesday closing price. It is equivalent to about 8 percent of reported shares outstanding.

Minneapolis-based U.S. Bancorp said the buyback replaces an existing repurchase program.

U.S. Bancorp has about $213 billion of assets, and operates 2,434 banking offices, mostly in the western two-thirds of the United States. Its shares rose 23 cents to $32.15 in morning trading on the New York Stock Exchange.


edit cuz I can't type!

[54anickel]

18. U.S. Companies' Quarterly Profits Climb 19%, Lifted by Energy

http://www.bloomberg.com/apps/news?pid=20601103&sid=aDBLCIX8todE&refer=us

Aug. 4 (Bloomberg) -- U.S. companies' second-quarter earnings rose by an average of 19 percent as energy producers, bolstered by record oil prices, regained their standing as the fastest-growing industry group.

Profit for members of the Standard & Poor's 500 Index climbed more than 10 percent for the 12th straight quarter, matching the longest streak since 1950, according to Thomson Financial.

Oil and gas companies reported a 45 percent increase on average, the largest among the index's 10 main industry groups. Earnings at Marathon Oil Corp., the fourth-largest U.S. energy company, and Valero Energy Corp., the country's biggest refiner, more than doubled. Crude-oil futures averaged $70.72 a barrel in the quarter, 33 percent higher than a year earlier.

``This oil price is going to remain high for some time and indeed could spike upwards,'' Michael Hughes, chief investment officer at Baring Asset Management Ltd. in London, said in an Aug. 1 interview. ``That obviously implies that the earnings growth from this sector is actually going to be pretty high for some time.''

Telephone-service providers were the S&P 500's leaders in the first quarter, with 46 percent earnings growth. Energy was second, at 34 percent, after having the best performance in the previous three quarters.

more...

[54anickel]

19. 9:35 and open for bidness!

Dow 11,319.19 +76.60 (+0.68%)
Nasdaq 2,111.16 +18.83 (+0.90%)
S&P 500 1,280.27 0.00 (0.00%)
10-yr Bond 4.901 -0.05 (-1.01%)
30-yr Bond 4.997 -0.038 (-0.75%)
NYSE Volume 78,492,000
Nasdaq Volume 100,386,000

09:15 am : S&P futures vs fair value: +10.2. Nasdaq futures vs fair value: +14.2.

09:00 am : S&P futures vs fair value: +11.0. Nasdaq futures vs fair value: +16.0. Bullish bias persists in pre-market trading, as a sharply higher start for the cash market remains intact. Stocks continue to rally into the opening bell, with the S&P 500 expected to get some notable support from the influential Financials sector as plummeting bond yields make rate-sensitive banks and brokers more attractive while reports that Chicago Mercantile Exchange Holdings (CME) will be added to the S&P 500 offers some additional support. The 10-yr note is now down 18 ticks to yield 4.88%.

08:30 am : S&P futures vs fair value: +6.4. Nasdaq futures vs fair value: +9.0. Futures indications are now signaling a higher open for stocks as an encouraging July jobs report provides more evidence that the Fed is likely to pause at next Tuesday's FOMC meeting. Non-farm payrolls rose a less than expected 113K (consensus 145K); hourly earnings rose 0.4%, exceeding economists' forecast of 0.3%, but the unemployment rate rose to 4.8%. Given the Fed's increased policy guidance from "incoming" data, the bond market is also embracing the soft data as the 10-yr note is now rallying up 14 ticks, knocking the yield down to 4.90%.

08:00 am : S&P futures vs fair value: +1.4. Nasdaq futures vs fair value: -0.2. Futures versus fair value reflects traders' wait-and-see attitude ahead of the much-anticipated July Employment report. It's due out at 8:30 ET and, not surprisingly, there is an air of nervousness ahead of it, especially since the report is the last key piece of data policy makers will get their hands on before they meet on Tuesday to determine if an 18th interest rate hike is necessary.

06:26 am : S&P futures vs fair value: +0.6. Nasdaq futures vs fair value: -1.8.

06:26 am : FTSE...5851.20...+12.80...+0.2%. DAX...5681.86...+41.83...+0.7%.

06:26 am : Nikkei...15499.18...+28.81...+0.2%. Hang Seng...16887.80...-160.62...-0.9%.

[54anickel]

21. Opposing Experts Square Off Over Grasso’s Pay

http://www.nytimes.com/2006/08/04/business/04nyse.html?_r=2&ref=business&oref=slogin&oref=slogin

Was the $200 million awarded to Richard A. Grasso in his four final years as head of the New York Stock Exchange just and reasonable? Or was his pay an egregious misstep approved by a beholden and blindfolded board?

It depends on which expert you ask.

Next month, a jury will begin hearing testimony in the lawsuit filed against Mr. Grasso by Eliot Spitzer, the New York attorney general. The suit contends that the $80.6 million in compensation and $119.8 million in retirement benefits awarded to Mr. Grasso from 1999 through 2002 was unreasonable and violated the state’s laws governing nonprofits. Mr. Grasso contends that the pay was reasonable and justified by his many contributions to the Big Board, a nonprofit organization.

Court filings made this week by experts on both sides provide a glimpse of what the jury will hear in the case. The filings also indicate that information about the exchange’s financial results, upon which the Big Board’s directors relied in approving Mr. Grasso’s biggest paydays, was inflated through the use of an improper accounting technique.

Mr. Grasso was ousted from the New York Stock Exchange in 2003 after details of his compensation became public. The outcry surrounding his pay opened the door to greater scrutiny of executive compensation across the country.

more...

[54anickel]

22. Mexico's Exchange Blockaded by Lopez Obrador Protests

Smart move. If you're looking to get the attention of those in power in this world, effect the flow of capital. But, in seeking that attention - be careful what you wish for. OBL got their attention and look at the mess the world is in today. Of course, I don't give OBL all of the credit - that would "go to his head". It helped immensely having an Idiot 'n Thief and his gang in the WH.

http://www.bloomberg.com/apps/news?pid=20601087&sid=a4k6qbPuH9Y0&refer=worldwide_news

Aug. 3 (Bloomberg) -- Supporters of Mexican presidential candidate Andres Manuel Lopez Obrador blocked the nation's stock exchange for about six hours in an escalation of protests to demand a recount of the July 2 election.

Hundreds of demonstrators, amid light rain, waved flags and chanted ``ballot by ballot'' as they obstructed the entrance to the exchange and to an adjacent building where companies including Bank of America Corp. and Lehman Brothers Holdings Inc. have offices. All trading on the exchange is electronic and operations weren't affected, spokesman Guillermo Medina said.

Lopez Obrador is stepping up street protests as the electoral tribunal prepares to rule on his request for a full review of the vote, which he says was marred by fraud. A blockade since July 30 of Mexico City's main avenue has turned the eight-lane boulevard into a tent city, disrupting traffic and causing shops and hotels in the area to lose about $23 million a day.

``This is part of our civil resistance plan,'' said Martin Zepeda, 39, who joined the protest outside the exchange. ``We want a ballot-by-ballot recount,'' said Zepeda, a member of Lopez Obrador's Party of the Democratic Revolution who was elected federal deputy in the July 2 vote.

The blockade of the exchange started at 5:30 a.m. Mexico City time (6:30 a.m. New York time). Protesters began lifting the blockade around 11 a.m.

more...

[WhiteTara]

26. US employment data softer than expected

http://www.ft.com/cms/s/913e47f8-23b3-11db-ae89-0000779e2340.html
US employment was softer than expected in July, providing a knee-jerk relief rally for the markets on hopes the data would encourage the Federal Reserve to hold interest rates steady next week.

The Labour Department said 113,000 jobs were created last month, less than the 145,000 expected by economists. The data followed a weak second-quarter growth report released last week and added to the impression that US economy is slowing.

The Federal Reserve has raised rates steadily by a quarter-point at each meeting for the past two years and its Fed funds target currently stands at 5.25 per cent. A further move next week would be the 18th in a row.
snip
There was some concern about wage inflation as average hourly earnings rose 0.4 per cent, more than the 0.3 per cent expected, for an annual rate of 3.8 per cent.

However, market attention was on the headline job creation rate and bonds and stocks rallied while the dollar slid sharply.

of course, more

[AnneD]

37. Main Street and Wall Street diverge....

how can less job creation combined with increased layoffs EVER be good for the economy. How can an annual hourly wage increase that is well under the inflation rate be good for Main street or that bad for Wall Street. Why does Wall Street insist on killing the goose that lays the golden eggs? Penny wise and pound foolish I say.

[WhiteTara]

28. Japan calls for reform at IMF

http://www.iht.com/articles/2006/08/04/business/yen.php
TOKYO Finance Minister Sadakazu Tanigaki of Japan on Friday reiterated calls to give Asian emerging economies more voting power in the International Monetary Fund to reflect their growing role in the global economy.

Speaking at a news conference, he added that giving them more say in the Washington- based institution would help narrow the psychological distance between the fund and Asian countries. Those relations soured during the Asian financial crisis in 1997 and 1998.

Reviewing the allocation of the fund's quota, which determines a member country's voting power and the amount of financing a member can obtain, is a pillar of the fund's medium-term strategy to reform itself.

For nearly a decade, Tokyo has been calling for a review of the fund's voting structure, saying Asian countries are underrepresented.

"If we don't appropriately reflect voices of those underrepresented countries whose economies are developing quickly, we cannot maintain the legitimacy and credibility of the IMF," Tanigaki said.

more

[WhiteTara]

29. Pension system bill goes to Bush More protection against collapse

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2006/08/04/MNGIDKB9OA1.DTL

(08-04) 04:00 PDT Washington -- The Senate on Thursday night overwhelmingly approved the most significant changes to the private pension system since Congress created comprehensive rules covering employee retirement plans three decades ago.

The bill, which goes to President Bush for his signature, is intended to bolster the system for more than 44 million workers and retirees who receive traditional pensions that provide defined benefits. It would require employers that operate such plans to fund them more completely and would put on sturdier financial footing the federal insurance agency that gives Americans some protection if their pension plans collapse.

The legislation, which passed the Senate 93 to 5, also could accelerate the trend in which companies have been switching to newer retirement systems that blend a traditional pension with savings arrangements such as 401(k) plans.

Other aspects of the bill would offer special help to parts of the airline industry. Taken together, these and other provisions in the bill's nearly 1,000 pages represent the first substantial pension changes in a dozen years -- and the largest step the government has taken to protect retirement benefits since 1974, when Congress established such rules.

[54anickel]

36. 1,000 pages?!?!? So, what else is in there?

Pension act won't hold water
http://www.news-journalonline.com/NewsJournalOnline/Opinion/Editorials/opnOPN16080406.htm

The Pension Protection Act would not pass a truth-in-advertising test. It's not that the big pension bill Congress is poised to enact -- it's more than 900 pages long -- doesn't protect any pensions. The airline industry, in particular, got most of what it wanted. Some other ailing pensions may get a temporary reprieve. It's just that millions of Americans, with all good reason, are worrying that the pension they've earned through years of loyal work won't be there when they retire.

The pension act began as an effort to keep the government's pension-insurance agency from having to assume the obligations of too many teetering plans, a liability that lawmakers feared would lead to a savings-and-loan-style taxpayer bailout. It has ended up as no bulwark against the erosion of the traditional company-based pension -- the only sort, other than Social Security, that guarantees a fixed income in retirement.

Instead, the measure likely will have a topsy-turvy effect. It will entice more corporations to drop their healthy pension plans, while simultaneously bolstering the save-for-yourself version of retirement. Congress has now become a powerful booster in corporate America's relentless drive to shift the financial risk and responsibility of old age onto workers themselves.

snip>

The cost of extending the retirement tax breaks, without offsetting spending cuts, is an estimated $52.6 billion between 2007 and 2016, according to an analysis of congressional data by the liberal Center for Budget and Policy Priorities. The biggest chunk of this money would flow to taxpayers with incomes of $1 million or more. Money drained away now will not be available later, when Medicare and Social Security are expected to need an infusion of cash to finance the retirement of the baby boom generation.

So the Pension Protection Act is likely to shrink traditional pension coverage, hasten the shift of the retirement burden to workers and undermine the government's future ability to shore up Social Security and Medicare. It is a remarkable feat of legislative engineering, with all the strength of a New Orleans levee.

more...

[54anickel]

31. REITs Play ‘Monopoly' With Real Money

http://www.nysun.com/article/37268

While "Monopoly" has always been popular, it is only a game. More interesting than the legendary game where players buy and sell properties and collect $200 for passing "Go" is the reallife real estate game that financial institutions, real estate investment trusts, and financial service companies are playing these days.

One active player is Boston Properties, a REIT that is one of the largest owners of Class A office buildings in Manhattan, including 599 Lexington Ave., 399 Park Ave., Times Square Tower, and Five Times Square. Earlier this year, Boston Properties purchased from a partner, Allied Partners, its interest in the Citigroup tower on Third Avenue. It also sold its 2.8 million-square-foot office complex at 280 Park Ave. to a foreign investor for $2.8 billion, or about $1,007 a square foot.

snip>

"Since the public REIT market does not value shares based upon a roll-up of underlying asset values, the market values of public REITs do not always estimate a REIT's underlying asset value accurately," the managing director at Alvarez & Marsal, Gerald Pietroforte, said. "As a result, some public REITs such as Arden Realty and CarrAmerica have recently sold at significant premiums to their market values based upon strong underlying asset values. Other public REITs such as Reckson may have reason to believe that their underlying asset values support a significant premium, and therefore are willing to test that belief through a corporate sale."

"I believe that the reason REITs are selling themselves (or privatizing) is the clear disparity between public and private market valuations," the president of Mack Cali Realty, Mitchell Hersh, said via e-mail. "There is just so much capital in the private funds, hedge funds, equity shops, etc., that they have driven up pricing, in some instances to unrealistic levels. There is a notion (or a wish) that rents will rise quickly to keep pace with these pricing levels. While that may be true in certain euphoric markets like Midtown Manhattan and Southern California, history has shown that this phenomenon might not exist in many areas (rents in many suburban markets are virtually what they were in the 1980s)."

Mr. Hersh added, "In any event, publicly traded REITs, particularly those with management teams frustrated by the onerous conditions set by Sarbanes-Oxley compliance and other SEC regulations, have decided to take the money and run. They can always start again if their views are right and a pricing correction occurs down the road a few years."

snip>

"The current market valuations have many companies trading at discounts to net asset values based upon private valuations, so that more public to private transactions are likely in the near future," the chairman of the national real estate practice at Greenberg Traurig, Robert Ivanhoe, said.

more...

[54anickel]

32. The Pause That Will Not Refresh

http://www.321gold.com/editorials/schiff/schiff080406.html

When combined with last week's soft GDP numbers, today's weak jobs report, which contained an up-tick in the unemployment rate, gives the Fed all the cover it claims to need to ignore evidence of accelerating inflation and finally come through with the highly anticipated "pause." Global stocks, bonds, foreign currencies and gold will likely react positively to this development. However, in relatively short order, I expect U.S. markets to come under renewed selling pressure, particularly the bond market, as increasing inflation fears and diminished demand for long-term dollar denominated debt undermine the rally.

In my opinion, the relative calm created by the long, slow, and utterly predictable series of 1/4 point rate hikes over the past two year has lent primary support for the U.S. dollar and the bond market. Once this prop is removed by a Fed pause, despite a knee-jerk bond rally, I expect both bonds and the dollar to be sold. But what the Fed giveth on the short end, the market will likely taketh away on the long end. Ironically, when the Fed finally stops notching up short-term rates, the market will likely start pushing up long-term rates. This will frustrate the Fed and Wall Street bulls who had hoped that a pause would breathe life into the stagnating economy.

A surge in long-term rates will immediately translate into higher mortgage rates, putting the final nail in real estate's coffin. The bubble is finally dead, may it rest in peace. Unfortunately the same can not be said for those who bought into it, and those who financed the speculation. For them, and the entire nation for that matter, the real estate nightmare is just about to begin.

Despite the strong likelihood that the hoped-for soft landing for the economy will more resemble a crash and burn, consumer price increases will only accelerate. This will come as a shock to most economists and Wall Street strategists who naively expect slower growth to cool inflation. Unfortunately, when it comes to inflation's effects on consumer prices, they ain't seen nothing yet. When the stagflation scenario is finally embraced as fact, things will really start to unravel for the U.S. dollar, bonds, stocks, and real estate.

bit more...

[54anickel]

33. Along with Peak Oil, Peak Grain and Peak Water, the world enters crisis ov

Along with Peak Oil, Peak Grain and Peak Water, the world enters crisis overload

http://www.koreaherald.co.kr/SITE/data/html_dir/2006/08/01/200608010027.asp

A deadly combination of heat and drought is slowly wreaking a trail of devastation across much of the globe, and the full extend of this scourge will only be felt as winter nears.

The current phenomenon took meteorologists by surprise as it was unusually global in its reach. Like Murphy's Law, everything that could go wrong did.

Nourishment for winter burnt up under an unusually fiery weather, along a food chain that progressed from withered wheat crops to cattle that were hastily sold off for lack of grazing grounds.

Crops that survived wilted under the sun, yielding produce of lowered quality and quantity; leading ultimately to higher prices. Alarmingly, these were scorched in the surplus granaries of the United States, Europe and Australia.

snip>

Lester Brown, President of the Earth Policy Institute, predicts that 20 million tons of global harvest may have winnowed up as summer chaff.

In June, he warned that the global cupboard - or "reserve" - of grains were at its lowest levels since the early 70s. According to this calculation, there's enough basic grain to keep people alive for 57 days, if a combination of disasters strike.

And there is no better place for that to begin than in the Middle East.

more...

[54anickel]

45. Safe haven assets

http://www.huahintoday.net/index.php?action=show&type=news&id=987

WHERE do you invest your money during market drift and times of economic uncertainty?

During times of economic downturn, there are asset classes that have traditionally been used as safe havens. On these occasions there is often a ‘flight to quality’ into asset classes that are perceived to preserve capital whilst offering the opportunity of at least some gains.

Bonds
Bonds are a promise to pay. They are a promise to repay the capital and a promise to pay a fixed amount of interest. In this way they have always been viewed as a core safe haven asset with the advantage of being highly liquid. However there are risks attached to this asset class.

snip>

Cash
Cash is King, isn’t it? Cash is held by those who want to preserve their nominal value. Unlike other financial markets investments, whose cash values can rise and fall, money in the bank enjoys a fixed ‘value’ and usually some form of interest income. But financial security requires the preservation of purchasing power, not preservation of nominal value. According the British Chartered Insurance Institute, the British pound today is worth around 10% of what it was 30 years ago. In May of this year, the OECD whose purpose is to develop and maintain global financial stability gave an unprecedented warning about the US Dollar when it stated that a devaluation of the Dollar in the order of 30% to 50% now seemed ‘unavoidable’. There is little financial security in holding a currency with this kind of prognosis.

snip>

Other commodities
Commodity is the term used to describe the whole spectrum of natural resources that provide for basic human needs of food and shelter as well as underpinning all commerce and trade in the world today. Commodities can be broadly grouped into three classes: agricultural, energy and metals (precious and base). Base metals are core components in the economy. Copper underpins the electrical and telecoms industries. Nickel is critical to stainless steel production while aluminum is used in construction and forms the basis of the transport and electricity distribution industries.

snip>

Monetary inflation is always initially diverted to equity and real estate markets, which do not feature in consumer price indices. When these markets are exhausted this liquidity moves to commodities and natural resources. Although food and energy are core expenditures for most people, these costs are puzzling excluded from the consumer price indices of most developed countries.

Given the continued and growing demand from developing countries as well as general population increases, demand for commodities is unlikely to fall. But unique to commodities is the lead time for increasing supply. It can take more than 10 years to bring a new mine into full production, assuming that new mineral deposits can be found.

In the meantime, existing mines are being depleted. The additional constraints of environmental restrictions ensure that supply will usually lag behind demand. It isn’t just metals. Agricultural commodities are suffering from the effects of global warming with severe droughts affecting wheat and other grain harvests as well as severe weather affecting sugar harvests in Australia. The current high oil prices mean that much of Brazil’s sugar production is now being diverted to ethanol production as an alternative fuel for Brazil’s drivers.

more...

[54anickel]

34. 11:13 numbers and yada

Dow 11,294.22 +51.63 (+0.46%)
Nasdaq 2,103.95 +11.62 (+0.56%)
S&P 500 1,286.10 +5.83 (+0.46%)
10-yr Bond 4.899 -0.052 (-1.05%)
30-yr Bond 4.994 -0.041 (-0.81%)
NYSE Volume 886,054,000
Nasdaq Volume 659,125,000

11:00 am : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges. Meanwhile, aside from the soft jobs data surprising investors this morning, there is one particular industry group that is unexpectedly pacing the way among all S&P industry groups -- Tires & Rubber (+8.3%). Of its two components, Cooper Tire & Rubber (CTB 9.21 +0.02) was downgraded this morning while Goodyear Tire & Rubber (GT 12.13 +1.06) posted a 97% drop in Q2 profits. Be that as it may, CTB, which is down 39% this year, is trading higher in sympathy with the market's broad-based move to the upside while GT, also garnering some bargain hunting interest with shares off 36% year-to-date, is surging 9.6% since earnings beat analysts' lowered expectations and management raised its cost-cutting goal. Tires & Rubber is the third worst performing industry group this year (-30.2%).DJ30 +72.44 NASDAQ +15.73 SP500 +7.13 NASDAQ Dec/Adv/Vol 888/1829/606 mln NYSE Dec/Adv/Vol 727/2302/546 mln

10:30 am : Equities are still on the offensive, but weakness from a few key technology names is preventing an even stronger performance for the Nasdaq and S&P 500. Apple Computer (AAPL 66.72 -2.87) plunging 4.0% amid reports that it may have to restate prior financial results due to irregularities in its option grant practices is the most notable tech laggard. Also, Motorola (MOT 22.85 -0.49) has fallen 2% after announcing an SEC probe and warning that expanding hostilities in the Middle East may disrupt its business while multiple analyst downgrades on Sprint Nextel (S 17.41 -0.34) following its Q2 disappointment Thursday extends its two-day losses to almost 14%. DJ30 +70.92 NASDAQ +15.38 SP500 +6.99 NASDAQ Dec/Adv/Vol 699/1896/458 mln NYSE Dec/Adv/Vol 558/2379/400 mln

10:00 am : Major averages are off their opening highs but the bulk of sector leadership remains positive. Providing the bulk of early support has been Financials (+1.2%), as a noticeable decline in borrowing costs makes rate-sensitive banks and brokers more appealing. The yield on the 10-yr note has fallen to as low as 4.876%, the lowest level since April 7th, and is now at 4.89%. Chicago Mercantile Exchange Holdings (CME 479.79 +21.72) surging 5% amid confirmation that it will be added to the S&P 500 is also offering some support. Other sectors gaining at least 1.0% include Industrials, Consumer Discretionary, and Materials. Energy, however, has recently inched into the red as follow-through selling in oil prices prompts investors to rotate out of some of this year's best performing industry groups like Oil & Gas Equipment, Refiners and Integrated Oil, which are up 25.6%, 22.9% and 21.6%, respectively, so far this year. DJ30 +63.02 NASDAQ +20.58 SP500 +8.05 NASDAQ Dec/Adv/Vol 471/1935/284 mln NYSE Dec/Adv/Vol 353/2324/236 mln

[54anickel]

35. OT - We're All Enemy Combatants Now

Did I already post this? Sorry if it's a dupe - been a crazy week here.

http://www.tompaine.com/articles/2006/08/02/were_all_enemy_combatants_now.php

Today in the Senate Judiciary Committee the Bush administration will unveil proposed new legislation to respond to the Supreme Court’s June ruling in Hamdan v. Rumsfeld. A final version of this legislation remained concealed right up to the day before the Senate hearing. Such secrecy disarms the public—and more importantly for today’s hearing, congressional staffers who need to brief their bosses—from analyzing and understanding the draft. This secrecy, aside from some leaked drafts of the bill, should sound alarm bells about what the administration is about to propose.

It appears the legislation moves two steps back for every step forward it takes in responding to problems identified by the Supreme Court. More dangerously, the administration’s proposed legislation likely will seek to assail vital checks and balances in subtle, invidious ways that might escape Congress’ attention.

Strictly speaking, the Supreme Court’s decision in Hamdan concerned only the president’s deeply flawed and procedurally irregular military commissions at Guantánamo. Yet any legislative response is likely to sweep further than the relatively narrow matter of how persons detained in battle can be tried for violations of the law of war. Administration testimony before Senate and House committees reveals the White House’s concern with issues of larger dimension: They are quietly looking for Congress’ seal of approval on a system of expansive military detention for both citizens and non-citizens.

Most American residents would be shocked to hear that the military has power to lock them up without an opportunity to prove their innocence before an independent judge. Indeed, a 1971 law, pushed by a former federal judge and survivors of the Japanese internment, actually bars executive detention without any statutory authorization. Yet drafts of the government’s proposed military-commission legislation slyly concede precisely this unchecked lock-up power to the executive branch despite the caution embodied in the 1971 law.

The leaked draft—admittedly, one that is likely to reflect the final version only imperfectly—does state that only “enemy combatants” can be hauled before a military commission, which offers less due process than the regular criminal courts or the military’s courts-martial. In other litigation, however, the administration has taken the position that an “enemy combatant” can also be detained until the end of the conflict, even if they are found to be innocent in a military commission. That conflict, moreover, is defined as a war “between the United States and international terrorist organizations,” to use the language of the leaked draft. For all practical purposes, this entails detention without end.

more...

[Gregorian]

39. Almost time? Someone spends time at B3TA!

That's Happy Toast's picture. I know. I live over at b3ta.


Very cool. Glad to see you hang out at the two best websites on the net.

YAY.

Now back to my real estate scheming.

[54anickel]

40. Gold gains moderate in wake of jobs data

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B9614F705%2D1B08%2D4CF3%2DACA6%2D6831C47CCEEA%7D&link=&keyword=silver

WASHINGTON (MarketWatch) -- Gold futures gave back some of their early gains Friday, but metals remained broadly higher as traders took their cue from weakness in the U.S. dollar tied to a slowdown in U.S. employment growth.

snip>

"The perception of the cooling economy reinforced the position of those market participants who believe that next week's Fed meeting will be just that -- a meeting without a resulting change in interest rates," said Kitco analyst Jon Nadler.

However, Nadler said there remains "ample evidence that inflation is ... alive and well." Indeed, the Labor Department's payrolls report showed average hourly earnings are up 3.8% in the 12 month through July.

"The combination of these opposing forces signals stagflation -- a scenario feared by many, especially in an election year," Nadler said in a note to clients.

more...

[54anickel]

41. 12:06 Lunch break

Dow 11,284.85 +42.26 (+0.38%)
Nasdaq 2,096.15 +3.82 (+0.18%)
S&P 500 1,284.27 +4.00 (+0.31%)
10-yr Bond 4.903 -0.048 (-0.97%)
30-yr Bond 4.998 -0.037 (-0.73%)
NYSE Volume 1,173,658,000
Nasdaq Volume 860,397,000


12:00 pm : Stocks are at session lows midday but still sporting modest gains as an encouraging July jobs report provides more evidence that the Fed will likely pause at next Tuesday's FOMC meeting.

Non-farm payrolls rising a less than expected 113,000 (consensus 145,000) and the unforeseen rise in the unemployment rate for the first time since November to 4.8% suggest that a labor market losing some steam does not warrant another rate hike. To wit, fed funds futures are only pricing in about an 18% chance of an August 8 rate hike versus 44% likelihood before the jobs report which had some investors on the fence about whether the Fed would finally take a breather. Less bullish, though, was an unanticipated 0.4% rise (consensus 0.3%) in hourly earnings, which will be of some concern to the Fed. However, the overall data reflect a slower rate of economic growth, with no indication of a recession, and are consistent with the soft landing that the Fed desires.

Of the nine economic sectors, providing the bulk of early support has been Financials (+0.8%), as plunging bond yields make rate-sensitive banks and brokers more attractive. The yield on the 10-yr note (+15/32) currently stands at a four-month low of 4.89%. Also offering some notable leadership has been Consumer Discretionary which, recently inched back into the green for the year as oil prices slipping below $75 per barrel exacerbate follow-through buying in retail. Crude oil futures are off 0.7% as Tropical Storm Chris being downgraded to a depression eases concerns of potential damage to oil platforms in the Gulf.

Weakness in oil, however, has prompted some consolidation throughout the Energy sector, whose absence to the upside is preventing an even stronger performance for the broader market. Also contributing to the market's recent pullback has been weakness from some key technology names. Apple Computer (AAPL 65.30 -4.29) has plunged 6.0% after warning it may have to restate profits due to stock option irregularities while multiple analyst downgrades on Sprint Nextel (S 17.41 -0.34) following its Q2 disappointment Thursday extends its two-day losses to nearly 14%. Other notable tech laggards include CSCO (-1.4%), MOT (-1.0%), ORCL (-1.4%) and ADBE (-1.3%). DJ30 +41.70 NASDAQ +7.81 SP500 +4.45 NASDAQ Dec/Adv/Vol 1097/1685/842 mln NYSE Dec/Adv/Vol 874/2233/754 mln

11:30 am : More of the same for the averages as buying remains widespread across most areas. Nine out of 10 economic sectors continue to post gains, led by the most influential of them all -- Financials (+1.1%) and noteworthy improvement in Consumer Discretionary. The latter has turned positive on the year amid follow-through buying in retail (+1.6%) and homebuilding (+1.3%) as well as a rebound in autos (+2.2%). DJ30 +68.12 NASDAQ +15.37 SP500 +8.14 NASDAQ Dec/Adv/Vol 1029/1738/724 mln NYSE Dec/Adv/Vol 827/2260/652 mln



Advances & Declines
NYSE Nasdaq
Advances 2227 (68%) 1641 (55%)
Declines 901 (27%) 1162 (39%)
Unchanged 136 (4%) 150 (5%)

--------------------------------------------------------------------------------

Up Vol* 690 (64%) 518 (64%)
Down Vol* 356 (33%) 278 (34%)
Unch. Vol* 17 (1%) 7 (0%)

--------------------------------------------------------------------------------

New Hi's 186 99
New Lo's 46 61

[54anickel]

44. FCC orders Time Warner to put NFL network back on (Thank Bob!!!)

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=google&guid=%7BC6397FCF-F8A2-491E-B35B-813ED2D817DD%7D&keyword=

WASHINGTON (MarketWatch) -- Federal Communications Commission Chairman Kevin Martin on Thursday said the agency ordered Time Warner Inc. (TWX) to put the NFL Network back on its cable systems.

snip>

NFL Network filed a complaint with the FCC after customers who formerly had NFL Network suddenly lost the channel on Tuesday, when Time Warner became their new cable provider. The network argued that Time Warner violated rules requiring that cable companies give 30 days notice to customers before changing their lineups.

Martin said that Time Warner will have until Aug. 15 to respond to the FCC's action.

At the center of the debate is the network's desire to be included on the basic expanded tier - which gets the largest swath of customers. Time Warner Cable wants to put the network on its sports tier instead, which it offers as NBA-TV, Outdoor Channel and various Fox Sports channels for $5 a month.

[54anickel]

46. 1:08 and mixed messages now appearing

Dow 11,275.73 +33.14 (+0.29%)
Nasdaq 2,088.03 -4.30 (-0.21%)
S&P 500 1,282.18 +1.91 (+0.15%)
10-yr Bond 4.903 -0.048 (-0.97%)
30-yr Bond 4.998 -0.037 (-0.73%)
NYSE Volume 1,450,507,000
Nasdaq Volume 1,081,041,000

1:00 pm : Major averages continue to trade in split fashion as market internals now suggest a mixed bias. After painting a very bullish picture most of the morning and underscoring the improved underlying tone that clearly became evident last week, market breadth continues to deteriorate. While advancers on the NYSE still outpace decliners, the more than 6-to-1 edge they enjoyed during the first hour of trading has long since disappeared as that ratio has been trimmed to a 3-to-2 margin. On the Nasdaq, decliners now outpace advancers, holding a 15-to-12 edge as ongoing concerns about stock option irregularities continue to plague the tech sector. DJ30 +26.09 NASDAQ -6.80 SOX -0.3% SP500 +0.68 NASDAQ Dec/Adv/Vol 1581/1275/1.06 bln NYSE Dec/Adv/Vol 1280/1893/942 mln

12:30 pm : Indices continue to weaken as the afternoon session gets underway. A reversal in Technology (-0.2%), spearheaded by further deterioration in Apple Computer (AAPL 65.14 -4.45), continues to weigh most heavily on the broader market and especially the Nasdaq, where APPL has been the most heavily traded stock. To wit, the tech-heavy Composite has recently turned negative and is now on pace to close down for the week.DJ30 +27.18 NASDAQ -4.51 SP500 +1.13 NASDAQ Dec/Adv/Vol 1419/1421/986 mln NYSE Dec/Adv/Vol 1189/1972/882 mln

[stop the bleeding]

48. Strike that - full on flip flop and everyone is fucked that got in this

morning, the DJIA just went below it's opening.

Now lets wait for the inevitable last hour pump and dump:eyes: - this never gets old but it is really quite predictable

[stop the bleeding]

51. update triple digit sell off in the DJIA

I would imagine the selling is starting to have run it's course for the day, but I could be wrong

[54anickel]

53. I was wondering if we wouldn't see an afternoon dive. The Adv/Dec

numbers were slowly deteriorating most of the day. 1:37 numbers - waiting on the blather.

Dow 11,220.42 -22.17 (-0.20%)
Nasdaq 2,076.43 -15.90 (-0.76%)
S&P 500 1,276.35 -3.92 (-0.31%)
10-yr Bond 4.901 -0.05 (-1.01%)
30-yr Bond 4.994 -0.041 (-0.81%)
NYSE Volume 1,604,626,000
Nasdaq Volume 1,194,861,000

I don't hold much hope for the 2:00 fairies seeing as it's a Friday and the world is a "bit outta wack" so to speak.

[54anickel]

54. Side of blather

1:30 pm : Stocks continue to make fresh session lows as sellers take control of the afternoon action and the blue chip indices join the Nasdaq in negative territory. In stark contrast to the strong industry leadership supporting early gains, when nine out of 10 sectors were trading higher, the complete opposite is true now, with Financials (+0.4%) as the lone sector still posting a gain. Fortunately for the rate-sensitive sector, bonds continue to hold up nicely, as the yield on the 10-yr note still stands at a four-month low of 4.89%; but the absence of leadership from Energy (-1.5%), as oil prices (-1.5%) continue to sell-off and Technology (-0.7%) extending its reach into the red leave a two-day winning streak for the indices in jeopardy. DJ30 -10.69 NASDAQ -14.17 SOX -0.8% SP500 -2.93 XOI -0.6% NASDAQ Dec/Adv/Vol 1620/1252/1.17 bln NYSE Dec/Adv/Vol 1308/1892/1.04 bln


Advances & Declines
NYSE Nasdaq
Advances 1705 (51%) 1111 (36%)
Declines 1507 (45%) 1775 (58%)
Unchanged 124 (3%) 141 (4%)

--------------------------------------------------------------------------------

Up Vol* 698 (45%) 420 (36%)
Down Vol* 787 (51%) 724 (62%)
Unch. Vol* 36 (2%) 16 (1%)

--------------------------------------------------------------------------------

New Hi's 191 103
New Lo's 52 82

[54anickel]

55. U.S. stocks fades to losses ahead of weekend

http://biz.yahoo.com/cbsm-top/060804/b974272439338425685d3a2578a886ef.html?.v=1

NEW YORK (MarketWatch) -- U.S. stocks turned lower Friday afternoon, as a rally, inspired by hopes for an end to the Federal Reserve's current rate hikes series, faded as traders readied for the weekend.

Investors have been puzzled in recent sessions as to whether the Fed will lift rates again at its Aug. 8 monetary-policy meeting. Earlier soft non-farm payrolls data were seen as providing the strongest possible incentive for the central bank to pause, sparking a rally.

"The sell-off that we're seeing this afternoon is just people lightening their positions ahead of the weekend," said Tim Heekin, head of stock trading at Thomson Weisel Partners.

more...

[Ghost Dog]

49. European stocks buoyed by weak US jobs data

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38933.4887615741-880018558&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

European equities rallied strongly on Friday, after the losses of the previous session, as fears of rising global interest rates were tempered by US jobs data indicating the Federal Reserve’s monetary tightening may soon be over. Non-farm payrolls in the US showed a fewer-than-expected 113,000 new jobs were created in the world’s largest economy in July. The numbers were interpreted as meaning the Fed would be less likely to raise interest rates next week. This followed Thursday’s sharp falls after unexpected hawkishness from the European Central Bank and a surprise rate increase from the Bank of England. In late trade the FTSE Eurofirst 300 was 1.2 per cent higher at 1,345.33. In Paris, the CAC 40 gained 1.2 per cent to 5,040.95, while Frankfurt’s Xetra Dax added 1.5 per cent to 5,723.03 and London’s FTSE 100 climbed 0.9 per cent to 5,889.4.

Yup, seems it's that simple: Higher unemployment, severer conditions for the less-well-off, implies less risk of higher interest-rates and hence greater riches for the few!

It's still all good. :silly: "It's the stoopidty, stoopid!"

[Ghost Dog]

50. London boosted by weak US jobs data and banking bounce

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38933.4888657407-880018563&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

London equities staged a comeback on Friday as the market recovered some of its poise after Thursday’s shock rate rise from the Bank of England. Weaker than expected US jobs data also provided a boost to stocks as it raised the likelihood the US Federal Reserve would pause its monetary tightening. Non-farm payrolls in the US showed a fewer-than-expected 113,000 new jobs were created in the world’s largest economy in July. Banking stocks, hard hit in the previous session amid fears that rising rates could trigger a jump in bad debt, made progress, with Alliance & Leicester up 2 per cent to £10.15, Northern Rock 3.4 per cent higher at £11.2225 and Barclays gaining 2.8 per cent to 634.36p. Royal Bank of Scotland, up 0.9 per to £17.365, also advanced as the UK’s second largest bank brought the curtain down on a busy reporting week for the sector. In the wider market, the FTSE 100 rose 0.9 per cent to 5,889.4, while the mid-cap FTSE 250 was 1 per cent stronger at 9,359.1.

[54anickel]

56. Ewwww, nice article on the "stoopid" Dimson in that link GD. Thanks

snip>

"We discussed a lot of issues. The Prime Minister has laid out a comprehensive plan. That's what leaders do. They see problems, they address problems, and they lay out a plan to solve the problems. The Prime Minister understands he's got challenges and he's identified priorities."
-- President George W. Bush, joint press availability with Nouri al-Maliki, Prime Minister of Iraq, July 25, 2006

The truly shocking thing about that bizarre statement is that it wasn't even in response to a question. Those were Bush's opening remarks. He did, one assumes, actually meet with Maliki. And they must have talked about something. But Bush doesn't seem to have been listening. Instead, he sounds like a college kid bullshitting in section because he didn't do the assigned reading. "We talked about security in Baghdad," Bush observed, delving into specifics. "No question the terrorists and extremists are brutal."

end snip>

Just another one of those embarrassing moments for the US. Our "diplomacy" would make great cuts on "America's Funniest Home Videos" if they weren't so damned sad. That's Bush, our chief resident - a regular comedian. :puke:

[54anickel]

57. Buyers Mock Wall of Worry

http://www.321gold.com/editorials/ackerman/current.html

Have stocks ever climbed a wall of worry so ostentatiously as they are climbing one now? Not that I can recall. With Iran threatening to goose oil prices to $200, all-out civil war erupting in Iraq, and Lebanon offering in microcosm all of the elements of a possible Third World War, investors somehow found ample reason yesterday to push the Dow Industrial Average 42 points higher. It surely wasn’t upbeat earnings reports that caused this; for in fact the tape brought yet more glum news from the corporate sector: layoffs at AOL, a bad July at Starbuck’s, huge losses at Ford, disappointing sales at Target, and widening concern among retailers and analysts that consumer spending is about to fall off the edge.

Wall Street’s apparent ability to take such things blissfully in stride suggests not so much cautious optimism as clinical insanity. Do bulls perhaps believe that the End of Days will produce the short squeeze that finally catapults the blue-chip average above 12000? We won’t deign to speculate on this, since we’ve learned that stocks can do just about anything on a given day -- no matter what the news, and especially if the news gives rise to the kind of strong expectations that so often get knocked on their ass.

For our part, we were long in Citigroup, which not only gave up ground while most other stocks were rising, but actually bucked a bullish trend in banking-sector shares. Our straddle position will make us longer if Citi rallies and shorter if it plunges, but all of this staggering around will only test our patience. On the bright side, one of our very favorite death-watch stocks, Beazer Homes, became even more shortable by rising 1.68 points on the day. The gain in the last two weeks has been 23 percent, a ripening trend that is going to make Beazer the short-of-the-month if it continues for just another day or two. Keep your bulletin launcher open, since the opportune moment could come at any time of the day.

[54anickel]

58. The Landing Pad

http://www.gold-eagle.com/gold_digest_05/ci080106.html

The Landing Pad…As you most likely know, or better know, housing is a classic leading economic indicator in terms of forward directional trajectory of domestic GDP. In the past, we’ve shown you the very strong historical correlation between the NAHB (Natl. Assoc. of Home Builders) housing survey and the year over year rate of change in real US GDP. There’s no mistaking the relationship between housing and the economy. And at the moment, the NAHB survey indicator is pointing directly to a slowing of the macro US economy to come. And very importantly, it’s not just the builders who are somber, but their customers are also none too confident. Below is the University of Michigan survey component regarding consumer sentiment toward real estate. For effect we have overlaid the year over year change in US payroll employment. Now do you see why housing is so important a leading indicator? Of course you do.

But as we step back a bit and ponder longer term risk in both the real economy and in financial asset prices that represent the real economy, a question of importance is the ultimate magnitude of the “landing”, so to speak, for the greater residential real estate cycle. Will we achieve the proverbial soft landing the Fed must surely be hoping for, or will it be a dreaded hard landing? Without sounding melodramatic, the correct answer to this question is of very meaningful importance if you ask us. Maybe really of primary importance over the next year or so. For at this point, what happens to housing ahead involves not only the domestic US economy, but also quite crucially the US credit cycle. As housing “lands”, per se, so lands the broader US economy? Let’s put it this way, we think it’s a very good bet.

For now, the ultimate character of a housing cycle soft or hard landing is unknown. Since housing cycles play out over a period of years, as opposed to months or quarters, it’s still probably a while to come until we can offer up an intelligent answer as to the magnitude or depth of the real estate cycle endpoint or trough. So what do we do in the meantime? Of course, we watch and listen. We watch the numbers that characterize the fundamentals of the industry and “listen” to what the financial markets are predicting vis-à-vis financial asset price movements. We thought we’d have a look at a few of the items we’re watching in an attempt to formulate some type of objective outlook moving forward. Let’s start with a look at the DJ Home Construction Index. This relatively broad index was very close to a ten bagger between early 2000 and the summer of last year. In our minds, it’s literally the picture that symbolizes the systemic liquidity bubble baton handoff from stocks to residential real estate at the dawn of the current decade. At recent levels, this index is down over 45% in just about 12 months. This type of price action suggests a good bit of sector distress to us, but so far we have not seen the real US housing sector or industry completely fall apart. Remember, in the wonderful world of theoretical efficient market theory, financial asset prices lead real world outcomes. So for now, this index is telling us that the coast is certainly far from clear when it comes to the real world of domestic residential real estate.

snip>

As a bit of an aside, although the housing industry stocks have absolutely taken it on the chin lately, and the mortgage purchase apps are in a clear downtrend, the stocks of companies that finance residential real estate look nothing like their housing industry counterparts as you'll see below. Why haven't these stocks fallen as has real world real estate activity and the stocks of the homebuilders, etc.? It's simple. Remember, as we've told you on many occasions now, the financial economy IS the real economy in the US. The fact that these stocks have not cratered is simply testimony to the fact that market participants are fully aware of this concept. At all costs, the Fed will protect the financial economy. Isn't that really the overriding implicit bet in the broader financial markets these days? (Answer: Of course it is.) Moreover, in all likelihood, another set of banking industry executive brain surgeons may indeed take one or all of the folks you see below out in M&A deals. Wachovia was the first to jump into the real estate finance game after the cycle of a lifetime has already been completed with the Golden West merger. Who's next? As you can see below, the stocks are waiting to find out. Yes, even highly risky sub prime lender New Century seems to implicitly be anticipating a bid. Oh well, banks and other large financial institutions seem to be doing what they do best in terms of market timing - buying exactly at the top of each cycle. As you know, the multiplicity of brokerage firm buyouts by the banks in the late 1990's and early in this decade worked out so well that the mortgage lenders must be next, right?

more...

[54anickel]

59. 2:25 and no sign of the calvary yet

Dow 11,198.65 -43.94 (0.39%)
Nasdaq 2,072.94 -19.39 (0.93%)
S&P 500 1,275.16 -5.11 (0.40%)
10-yr Bond 4.905% -0.046
30-yr Bond 4.996% - 0.039
NYSE Volume 1,856,027,000
Nasdaq Volume 1,370,474,000

edit for blather

2:00 pm : Indices are still languishing near their worst levels of the day as a diminishing number of traders continue to make their way toward the exits earlier than usual. With the first nine days of August historically weak, as much of Wall Street begins their summer vacations, it's not all that surprising to see some modest consolidation heading into the weekend. After all, the major indices averaged gains of more than 3.0% last week alone. However, continued weakness among blue chips now has the Dow and S&P 500 positioned to end this week on a lower note as investors question whether or not moderate economic growth will be able to support decent profit growth over the next 6-12 months. DJ30 -27.77 NASDAQ -14.94 SP500 -3.94 NASDAQ Dec/Adv/Vol 1805/1102/1.28 bln NYSE Dec/Adv/Vol 1580/1626/1.15 bln

[stop the bleeding]

60. yep, hide your daughters hide your wife

lock up your back door and run for your life - ACDC

[54anickel]

61. 3:07 and more red with volumes beginning to show some conviction

Dow 11,192.16 -50.43 (-0.45%)
Nasdaq 2,069.42 -22.92 (-1.10%)
S&P 500 1,274.23 -6.04 (-0.47%)
10-yr Bond 4.901 -0.05 (-1.01%)
30-yr Bond 4.991 -0.044 (-0.87%)
NYSE Volume 2,073,886,000
Nasdaq Volume 1,519,906,000

3:00 pm : Major averages continue to sport broad-based losses as the absence of spirited leadership from a number of blue chips further underscores the change of heart among buyers. JP Morgan Chase (JPM 44.74 -0.92) now paces the way lower among the 23 Dow components losing ground, turning a 1.0% gain into a 2.0% decline and contributing to the recent reversal in Financials. The latter was providing the only semblance of support this afternoon but JPM's decline is one of 1651 others that now outpace the number of advancers on the NYSE. DJ30 -50.27 NASDAQ -21.00 SP500 -5.83 NASDAQ Dec/Adv/Vol 1929/1012/1.49 bln NYSE Dec/Adv/Vol 1652/1606/1.36 bln

2:30 pm : No real change in sentiment as the complete reversal -- from early optimism to the return of concern tied to an economic slowdown -- continues to weigh on the proceedings. Aside from weakness throughout Technology acting as the biggest of afternoon impediments, a huge 4% swing in the Dow Jones Transportation Average, despite another pullback in oil prices, has also been a thorn in the market's side, especially on Industrials (-0.7%). Transports were up as much as 2.7% at the open but are now off 1.5%. DJ30 -42.82 DJTA -1.4% NASDAQ -18.74 SP500 -4.74 NASDAQ Dec/Adv/Vol 1796/1129/1.40 bln NYSE Dec/Adv/Vol 1539/1693/1.26 bln

[54anickel]

62. What do the Markets Think of the War?

http://www.kitco.com/ind/Silberman/aug032006.html

I was going to open this piece by telling you that the US will be joining the front lines in the Middle East (ME) imminently.

I was going to back up my sensational claim with charts showing the US economy on the brink of failure. My argument was going to be that financial problems at home would prompt the US Government to play the Patriot Ticket.

To divert the public’s attention away from their perilous financial situation the Government would become MUCH more active in the Middle East and the MUST WIN War against Terror.

Alas, those unforgiving and unemotional charts just won’t comply!

Some markets are definitely oversold. Most are up against support or resistance. But there is no evidence of a BIG break (up or down) just Yet.

more...

[54anickel]

63. 3:42 and DOW struggling for an up week

Dow 11,223.22 -19.37 (-0.17%)
Nasdaq 2,079.82 -12.51 (-0.60%)
S&P 500 1,277.81 -2.46 (-0.19%)
10-yr Bond 4.901 -0.05 (-1.01%)
30-yr Bond 4.992 -0.043 (-0.85%)
NYSE Volume 2,301,568,000
Nasdaq Volume 1,673,663,000

3:30 pm : Indices are staging somewhat of a comeback going into the close but it remains to be seen if there will be enough buyers to get stocks back into the green. The Dow has seen the biggest improvement among the majors, more than halving its recent losses within the last 30 minutes, and is back into positive territory for the week. The Nasdaq, however, would need nearly a full 1.0% swing from current levels just to get back to breakeven since closing at 2094 last Friday. DJ30 -17.13 NASDAQ -14.01 SP500 -2.05 NASDAQ Dec/Adv/Vol 1970/996/1.64 bln NYSE Dec/Adv/Vol 1678/1578/1.50 bln

[54anickel]

64. Closing time - just waiting on the volume numbers to settle and the yada

Dow 11,240.35 -2.24 (-0.02%)
Nasdaq 2,085.05 -7.28 (-0.35%)
S&P 500 1,279.36 -0.91 (-0.07%)
10-yr Bond 4.901 -0.05 (-1.01%)
30-yr Bond 4.992 -0.043 (-0.85%)
NYSE Volume 2,529,928,000
Nasdaq Volume 1,812,808,000


on edit:
NYSE Volume 2,530,943,000
Nasdaq Volume 1,878,592,000

4:20 pm : Friday was a wild day on Wall Street as early gains fueled by an encouraging July jobs report were wiped away as the return of concern tied to an economic slowdown outweighed the potential of a pause in tightening at Tuesday's Fed meeting.

Before the bell, nonfarm payrolls rose a less than expected 113,000 and the unemployment rate fell for the first time since November, suggesting the labor market is losing steam and reinforcing the view that the economy is on track for a soft landing. To wit, fed funds futures were pricing in a 44% chance of an August 8 rate hike before the jobs report was released at 8:30 ET, but then slashed hopes of more tightening by pricing in only 18% likelihood, which helped spark a broad-based rally in stocks right out of the gate.

Be that as it may, as the day wore so too did investors' patience as the improved underlying tone that so clearly became evident last week and had the market's poised to close higher for a third straight day diminished.

Technology was the first notable sector to relinquish early leadership due largely to Apple Computer (APPL 68.30 -1.29), which was down as much as 6.7% after saying it may have to restate past financials due to irregularities with stock-options backdating. Since the greatest risk for investing in tech has been tied to fears that the Fed will go too far with its tightening, further evidence of a possible pause did allow some bargain hunters to rear their head into the close, but the tech-heavy Nasdaq still finished modestly lower.

The Industrials sector was another notable leader to the downside as concerns about the pace of economic activity continued to take a toll on transports even in the face of another decline in oil prices. The latter resulted in the absence of leadership from this year's best performing sector and largest contributor to operating earnings growth on the S&P 500 -- Energy.

Meanwhile, Financials managed to post a modest gain, as a noticeable decline in borrowing costs made banks and brokers more appealing. The yield on the 10-yr note (+15/32) plunged to 4.89%, its lowest level since April 7th. However, the rate-sensitive sector's upside influence wasn't enough when it was all said and done to restored enough broad-based enthusiasm into the close to inch stocks back into positive territory. DJ30 -2.24 DJTA -1.0% NASDAQ -7.29 SP500 -0.91 NASDAQ Dec/Adv/Vol 1745/1248/1.87 bln NYSE Dec/Adv/Vol 1411/1851/1.72 bln

[stop the bleeding]

65. typical - now it is a holding pattern until tuesday

thanks for the updates 54nickel I know I was a little scarce this week, but I still enjoyed everyone's efforts/updates.

Have a good weekend and maybe UIA and Roland99 will be back next week - just in time for more funzzeee's

[54anickel]

66. Thanks Stop The Bleeding. I appreciate you and the others chiming

in here. It gets pretty lonesome posting to yourself during the day. Always nice to be appreciated. I haven't been as active on the SMW as I once was, hope I didn't scare anyone away that's been more accustom to this being UIA's gig.

Hope everyone has a great weekend. :hi: And I do hope some of the "regulars" return next week as my plate here is getting pretty full again. Won't have much time for DU and the SMW thread.