STOCK MARKET WATCH, Tuesday 5 September

[ozymandius]

Tuesday September 5, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 869 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2084 DAYS
WHERE'S OSAMA BIN-LADEN? 1784 DAYS
DAYS SINCE ENRON COLLAPSE = 1743
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 September 1, 2006

Dow... 11,464.15 +83.00 (+0.73%)
Nasdaq... 2,193.16 +9.41 (+0.43%)
S&P 500... 1,311.01 +7.19 (+0.55%)
Gold future... 632.60 -1.60 (-0.25%)
30-Year Bond 4.87% -0.01 (-0.10%)
10-Yr Bond... 4.73% -0.01 (-0.13%)






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

[ozymandius]

1. WrapUp by Tim W. Wood

THE DOW REPORT
Dow Theory and Cycles

Recently I have received e-mails asking about cycles and Dow theory. I have addressed this before, but it seems that it’s now time to look at this topic again. I have virtually every scrap of material written by Charles H. Dow, William Peter Hamilton and Robert Rhea and I want to confirm that cycles are definitely not a part of the Dow theory. I’ll also add that head and shoulder formations, rising wedges, symmetric triangles and other technical patterns are not a part of the Dow theory. The McClellan oscillator, stochastics, RSI nor any other oscillator for that matter, is a part of the Dow theory. Gold, the dollar, bonds or individual stock analysis is not a part of the Dow theory.

-cut-

For the record, Dow, Hamilton and Rhea also spoke of the market having “three well defined movements” or dimensions. Hamilton said, “There are three movements of the averages, all of which may be in progress at one and the same time. The first, and most important, is the primary trend: the broad upward or downward movements known as bull or bear markets, which may be of several years’ duration. The second, and most deceptive movement, is the secondary reaction: an important decline in a primary bull market or a rally in a primary bear market. These reactions usually last from three weeks to as many months. The third, and usually unimportant movement, is the daily fluctuation.” Cycles are simply another way of looking at these movements.

-cut-

It was the combination of both my trend or cycle quantifications and the Dow theory that I used to develop my 2006 forecast in which I stated in January we should first see the gain in 2006 and that the pain would follow in the last half of 2006. Also, In January I used statistical analysis to develop the projected market path for 2006. Thus far, that projection has been right on track with the market. It is cycle theory and my work with the Dow theory that is now telling me we are about to enter a window of great market risk. I hear many now saying that the 4-year cycle low was made in June/July, while others are expecting the low in October. According to my cycle/trend quantification, this is incorrect and as I see it, the market has a surprise or two up its sleeve in regard to the phasing of the 4-year cycle.

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

[ozymandius]

2. no Fed economic reports due today n/t

[ozymandius]

3. Oil prices recover in Asian trading

SINGAPORE - Oil futures rose Tuesday as some traders bought up contracts after the price plunged by more than a dollar in the previous session, but they still hovered below $69 a barrel.

The market remained wary about how the Atlantic hurricane season and the Iranian nuclear standoff might affect supplies.

"Some traders took the opportunity to buy contracts since the price has fallen quite a bit since Friday," said Victor Shum, energy analyst with Purvin & Gertz in Singapore. "This is probably an indication that the market may not fall beyond current levels unless some bearish event occurs."

Brent crude for October delivery rose 41 cents to $68.12 a barrel on the ICE Futures exchange in London. The contract settled Monday at $67.71 a barrel, down $1.44 a barrel.

http://news.yahoo.com/s/ap/oil_prices

[ozymandius]

4. Russia, Greece and Bulgaria to sign new pipeline agreement by year end

ATHENS (AFP) - Russia has reached an agreement with Greece and Bulgaria to speed up preparations for a new 280-kilometre (174-mile) Balkan pipeline transporting Russian oil to Europe and the United States, a project stalled for the past 13 years.

"We have set a timetable... to sign (the relevant) agreement in 2006," Greek Prime Minister Costas Karamanlis told a news conference on Monday, after holding talks with Russian President Vladimir Putin and Bulgarian President Georgy Parvanov in Athens.

Originally drawn up in 1993, the plan envisages transporting Russian oil by sea to the Bulgarian port of Burgas, and from there by pipeline to the Greek Aegean Sea port of Alexandroupolis.

A declaration signed by the three leaders on Monday pledges to speed up the process to create a project company, and to have a tripartite state agreement signed in the next three months.

http://news.yahoo.com/s/afp/20060904/bs_afp/greecerussiabulgariaoilenergypolitics_060904162811

[ozymandius]

5. Coaxing oil from huge U.S. shale deposits

Underneath the high, scrub-covered rangeland of northwest Colorado is the world's biggest oil field. Getting the oil out of the ground, however, is one of the world's biggest headaches.

The area's deposits of oil shale are believed to be larger than all the oil reserves of the Middle East. But past attempts to get at this oil locked in tarry rock have cost billions of dollars and raised the prospect of strip-mining large areas of the Rocky Mountain West.

Now, as the federal government makes another push to develop oil shale, Shell and other companies say they have developed techniques that may extract this treasure with much less environmental impact.

Shell's project is stunningly complex. Instead of strip-mining the rock and then processing it, Shell plans to superheat huge underground areas for several years, gradually percolating oil out of the stone and pumping it to the surface.

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2006/09/04/MNGIEKV0D41.DTL

[ozymandius]

8. Crude Oil Trades at 11-Week Low on Easing U.S. Gasoline Demand

Sept. 5 (Bloomberg) -- Crude oil traded at an 11-week low in London on easing demand for gasoline in the U.S., the world's largest energy consumer, with the end of the summer driving season.

U.S. gasoline usage usually rises 5 percent in the summer, then drops after Labor Day, which was yesterday. U.S. crude oil inventories held 332.8 million barrels at the end of August, 12 percent more than the five-year average for the period, the Energy Department said Aug. 30.

``Supply is high compared with the same period a year ago,'' said Alessandro Di Nunzio, an analyst at Wings Partners in Milan. ``So far, the hurricane season has not been as harsh as expected and that's led to an accumulation'' in stockpiles.

-cut-

Gasoline for October delivery fell 3.14 cents, or 1.8 percent, to $1.703 a gallon in after-hours trading in New York. The average U.S. price for unleaded gasoline fell to $2.740 per gallon on Sept. 3 from $3.023 the month before, according to the American Automobile Association, the nation's largest driver organization.

http://www.bloomberg.com/apps/news?pid=20601103&sid=abnlZb7qMwUI&refer=us

[AnneD]

64. We're saved , we're saved...

until the next big hurricane...

Test suggests huge Gulf of Mexico oil discovery

WASHINGTON — U.S. oil and gas reserves could grow by more than 50 percent as three companies said today that results from a deep-water exploratory drilling project in the Gulf of Mexico indicate a significant oil discovery.

Chevron Corp. estimated the 300-square-mile region where its test well sits could hold between 3 billion and 15 billion barrels of oil and natural gas liquids. Analysts are calling it the most significant domestic discovery since Alaska's Prudhoe Bay more than a generation ago.

<snip>


The country's reserves currently are more than 29 billion barrels of oil equivalent, according to the U.S. Energy Department. But the U.S. imports more than half of its oil from countries with much larger reserves, such as Saudi Arabia whose reserves are nearly 10 times those of the United States.

Chevron's well, called "Jack 2," was drilled about 5.3 miles below sea level. Chevron has a 50 percent stake in the field, while partners Statoil ASA of Norway and Devon Energy Corp. of Oklahoma City own 25 percent each.

http://www.chron.com/disp/story.mpl/front/4163472.html

[Ghost Dog]

32. Indonesia may take over Exxon Mobil gas field in Jan

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060905:MTFH15301_2006-09-05_10-08-57_JAK21091&type=comktNews&rpc=44

JAKARTA, Sept 5 (Reuters) - The Indonesian government may take over a huge natural gas field in the Natuna offshore area run by Exxon Mobil Corp. (XOM.N: Quote, Profile, Research) when its contract expires in January, Energy Minister Purnomo Yusgiantoro said on Tuesday.

The Natuna D-Alpha block contains around 222 trillion cubic feet (tcf) of gas, of which 46 tcf is thought to be commercially recoverable, but the field contains about 70 percent carbon dioxide, making it expensive to develop and difficult to sell.

"We will wait until next January, if Exxon Mobil has no commitment to produce gas and no commitment to sell gas, we will terminate the contract," Purnomo told reporters.

"After we extended the contract by another two years in 2005, there still has been no gas production and no market."

Indonesia and Exxon Mobil signed a basic agreement in 1995 covering an estimated $40 billion to be invested in the offshore gas project in the South China Sea. However, tapping the reserves has proved difficult.

"The cost of capturing and storing CO2 is very expensive with current technology. If it's not properly contained, it would be a problem for Exxon's public image," said Yonghun Jung of the Asia Pacific Energy Research Centre.

Exxon Mobil spokeswoman Deva Rachman said the company was looking for buyers for gas from Natuna D-Alpha.

/...

[54anickel]

36. Bit more....sounds like another great movie plot

"I think this is largely a negotiating ploy," said another analyst, declining to be named. "It was not one of Exxon Mobil's priorities to develop. This must be frustrating Pertamina.

"The best solution might be to tweak the terms to give Exxon Mobil an incentive to build the gas processing facilities and handle the CO2, and for Pertamina to help move up domestic gas prices to attract more suppliers... This is too big a field to get into a fight over."

Any government move not to renew Exxon's contract may cause concern among foreign investors about the uncertainties of doing business in Indonesia, adding to worries about Indonesia's legal system, labour and mining policies and corruption.

"If indeed Exxon Mobil's contract was cancelled, it would be interesting to see whether the big Chinese companies -- CNOOC or PetroChina -- would be tempted to take up the block," said Andrew Symon, Asia manager for consultancy Menas Associates.

[ozymandius]

6. Cairn leads fallers on London's FTSE

Cairn Energy led fallers in early exchanges in London on Tuesday as investors were disappointed by news that the group's biggest oil field would come onstream later than originally planned.

Shares in the UK-based oil explorer fell 3.3 per cent to £20.49 after it said that first oil at its Mangala field in Rajasthan had now been rescheduled for 2009 two years later than planned.

The company also told investors that the partial IPO for Cairn India on the Bombay Stock Exchange and National Stock Exchange of India in December 2006 was on track.

http://news.yahoo.com/s/ft/20060905/bs_ft/fto090520060406326104

[Ghost Dog]

51. FTSE ends below 3-1/2 month highs, retailers fall

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=londonMktRpt&storyID=2006-09-05T165157Z_01_L05064638_RTRIDST_0_MARKETS-BRITAIN-STOCKS-UPDATE-3-CLOSE.XML

LONDON, Sept 5 (Reuters) - Britain's leading shares fell from 3-1/2 month highs to end slightly lower on Tuesday, with Tesco (TSCO.L: Quote, Profile, Research) leading retailers down and pharmaceutical stocks including GlaxoSmithkline (GSK.L: Quote, Profile, Research) slipping.

Miners such as BHP Billiton (BLT.L: Quote, Profile, Research) and Rio Tinto (RIO.L: Quote, Profile, Research) bucked the trend and extended recent gains after a rally in copper prices, while BP (BP.L: Quote, Profile, Research) also edged higher.

Some economists and strategists highlighted the possibility of higher interest rates as a survey showed a surge in input prices despite Britain's services sector growing more slowly than expected in August.

The FTSE 100 index (.FTSE: Quote, Profile, Research) closed 4.9 points, or 0.08 percent, lower at 5,981.7, paring gains after a two-day rally which pushed the index to its strongest level in 3-1/2 months in the previous session. On Monday, the FTSE was up 37.5 points, or 0.6 percent.

/...

[ozymandius]

7. European bourses fall as profits booked

European equity markets gave back some of their recent gains on Tuesday as profit taking followed the previous session's run up to near four month highs.

In early trade, the FTSE Eurofirst 300 was down 0.2 per cent to 1,381.47, Frankfurt's Xetra Dax fell 0.2 per cent to 5,900.26, the CAC 40 in Paris shed 0.2 per cent to 5,191.21 and London's FTSE 100 slipped 0.1 per cent to 5,981.4.

EDF, the French power generator, fell 1.7 per cent to EU42.70 after the country's opposition Socialist Party said it would renationalise the company if it won next year's presidential election.

Credit Suisse cut its recommendation on EDF from "outperform" to "neutral", saying the next twelve months would be "more challenging" at both an earnings and political level. New energy laws could have an impact on earnings, the broker said, while "the context of a very uncertain presidential election also adds uncertainty".

http://news.yahoo.com/s/ft/20060905/bs_ft/fto090520060404316101

[Ghost Dog]

31. HK shares shed 0.43 pct, China properties gain

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060905:MTFH14350_2006-09-05_09-20-26_HKG3232&type=comktNews&rpc=44

HONG KONG, Sept 5 (Reuters) - Hong Kong stocks on Tuesday consolidated recent gains that had lifted the market to fresh six-year peaks, but Agile Property (3383.HK: Quote, Profile, Research) and other mainland real estate issues extended their winning streak, a day after the yuan <CNY=CFXS> set a post-revaluation high against the dollar.

The benchmark Hang Seng index <.HSI> ended on Tuesday down 0.43 percent, or 75.08 points, at 17,438.80.

Turnover fell to HK$24.9 billion (US$3.2 billion), as investors awaited fresh signals from Wall Street, which was closed on Monday for a national holiday.

"I still think the market will make another run to make a new high for the year, between 17,600 and 17,800, but if we can't make it there in the next few days, we may have further consolidation," said Jackson Wong, investment manager at Tanrich Securities.

Others said the market was showing signs of weariness, pointing to steep advances by small-cap stocks like INNOMAXX Biotechnology Group Ltd (0340.HK: Quote, Profile, Research).

"When you see small caps moving, it's a negative signal for the market," said Steve Cheng, associate director at Shenyin Wanguo. "When people have nothing else to buy, they chase third- or fourth liners ... and bid up garbage."

/...

[Ghost Dog]

50. European stocks close lower after recent gains

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2006-09-05T163625Z_01_L05577444_RTRIDST_0_MARKETS-EUROPE-STOCKS-UPDATE-3.XML

LONDON, Sept 5 (Reuters) - European shares closed lower on Tuesday, dipping from near four-month highs as technology stocks suffered and investors opted to cash in after recent healthy gains.

Technology names were hit by Getronics (GTN.AS: Quote, Profile, Research) and Capgemini (CAPP.PA: Quote, Profile, Research) being downgraded by Standard & Poor's and Societe Generale respectively. Finnish mobile handset maker Nokia (NOK1V.HE: Quote, Profile, Research) fell 1.6 percent.

The FTSEurofirst 300 <.FTEU3> index of top European shares closed 0.35 percent lower at 1,378.98 points having hit its highest close since May 11 on Monday.

The narrower DJ Stoxx 50 index <.STOXX50> was also 0.34 percent weaker at 3,537.3 but some strategists remain upbeat on European equities after strong earnings helped the market recover from May and June's sharp correction.

"In continental Europe, we have made a big increase in our earnings assumptions for 2006. We now expect earnings to grow by 19 percent in 2006, up from the 8 percent we forecast at the start of the year," said Lehman Brothers' Ian Scott.

"We expect global equities to rally into year-end, giving an index gain of 9 percent, and a U.S. dollar-based total return of 12 percent. Regionally, we see the best potential upside for stocks in Japan and continental Europe."

<snip>

Trading volumes picked up as U.S. markets reopened after Labor Day but Germany's DAX <.GDAXI> slipped 0.4 percent, France's CAC 40 <.FCHI> fell 0.6 percent and the UK's FTSE 100 (.FTSE: Quote, Profile, Research) lost 0.1 percent as Wall Street indexes were volatile.

/...

[ozymandius]

9. Ford needs new business model: memo

NEW YORK (Reuters) - Ford Motor Co. <F.N> needs a new business model in order to turn the automaker around, according to a memo addressed to staff by its Chairman and Chief Executive Bill Ford and seen by Reuters.

On Thursday, Ford said it wanted to sell its Aston Martin luxury unit to free up funds to invest in its other brands amid a sharp downturn in sales.

In the memo, dated Friday, September 1 and published by the Detroit News on Saturday, Bill Ford outlined the problems facing the company and his aims to turn it around.

http://www.washingtonpost.com/wp-dyn/content/article/2006/09/04/AR2006090400086.html

[ozymandius]

10. Good morning!

:donut: :donut: :donut:
I hope everyone had a wonderful weekend. Mine sure was. Our new digs have that moved-in feel.

Have a great day. I'll be back when it's over.

Ozy :hi:

[UpInArms]

16. Hiya, Ozy!

Glad that your move has yielded the hoped-for results and that all is well :D

Have a great day back at the 'zem -

:grouphug:

[AnneD]

34. Morning Marketeers...

:donut: and lurkers. Hope everyone is well rested. I am trying to get into business today, but I just can't get Steve Irwin's death out of my mind. I know everyone is focusing on the sad, but I find it one of the most eloquent death I have heard of in a long time. It was quick, relatively painless, and he was doing what he loved. And folks, I have seen a lot of death and it doesn't get any better than that. Death is usually a micro tableau of how you lived (loving people are surrounded by love in death etc). Of course, I feel sorry for the family and I am sure Steve is upset because he left his young kids and wife behind. My special prayers go out to his daughter 'cause that age and their closeness will make it very hard for her. The environment lost a great ambassador.

I wonder what type of death some of our 'leaders' will have. I won't mention any cause-no mater how eloquent. I am sure Agent Mike might take accept ion to them. Thinking is still legal...right? Maybe when they are no longer in office.

[Ghost Dog]

37. Hiya AnneD.

Although these past many years I do not watch TV, I'd heard about this guy, and read closely the full-(back)-page article about him in my Spanish newspaper this morning.

That's a powerful (non-aggressive: purely instinctive, I read) thing, a sting-ray dasyatidae tail, "coated with a powerful venom, as sharp as a razorblade and serrated".

...As you say, not at all a bad way to go...

My lady's mother here, on the other hand, appears to be just slowly (but at least not painfully) fading away. And there ain't much (legally) one can do about that in this country (Spain) other than trying to stay as close as possible, every day.

Ah, and be continually amazed, with a few sometimes wonderful exceptions, by the little and large errors, the general lack of genuine care (self-defense in a difficult job, I guess) the missing management and the grossly inflated bills one encounters most of the time...

ed: I'd thought about setting up a residential nursing home, trying to do the job properly (there is clearly a 'market'). My lady has some professional experience managing a surgery. But, I don't know: I guess it gets depressing.

[AnneD]

41. A well run home..

Is far from depressing. There are several models here in the US that are really breaking new ground. The group home seems to be rather cutting edge. Having the Nurses and other med folk 'visit' for the therapies etc, but other than that...an assisted home. The current model IS depressing and so many of the folks give up.
With the wages depressed, pensions frozen, government coffers raided....it's cardboard houses and dumpster diving in this countries retiring boomer's future.

[DemInDistress]

53. hi AnneD..yes I am a lurker but I enjoy this forum even with

limited knowledge about the wonderful world of finances. You folks here at terrific at what information you
porduce and display and I as a lurker applaud your efforts.

I call you the "Stock Marketeers" keeping a close eye on the global implications in this new world of finances.

Take a bow for you and the market gang are worth your weigh in gold.


thanks for being there..btw, I lurk everyday.

:hi: :thumbsup: :thumbsup:

[AnneD]

62. Hello Lurker

:hi: DemInDistress. Thanks for the kind word about the BB. Don't hesitate to drop in an post when you see something. That is how we get good info on this BB. I don't have the wonderful business background that some of these fine folks do-my expertise is Nursing and I figure in 10-15 more years, I am going to be everyones new best friend cause Nurses will be extinct.:rofl:

[DemInDistress]

66. thanks AnneD... you made my day. I wish I had the expertise

some of you marketeers have in this forum. Still by lurking around daily I hope to learn something and maybe contribute to the array of financial information here.

Thanks again AnneD.. I'll be lurking again tomorrow .


PS. I am waiting for the Dollar to crash. Somehow it just seems it has to happen sort of a financial blood letting.

[UpInArms]

11. daily dollar watch

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

Last trade 84.97 Change +0.12 (+0.14%)

Dollar Wavers But Doesnt Budge Much

http://www.dailyfx.com/story/strategy_pieces/trade_or_fade/Dollar_Wavers_But_Doesnt_Budge_1157366340101.html

In–line was good enough this week for dollar longs. Non-Farm payrolls printed at 128K near the expected value of 120K and though hardly a banner result, the news was sufficient to drop the EUR/USD by more than 70 points in a matter of minutes of Friday. The move was more of relief rally rather than a true sign of dollar strength as near record euro long positioning skewed the order books and triggered a price adjustment in the pair. By end of the day. However, remorse set in and the Euro managed to gain 66 basis point for the week.

Looking beyond the headlines, the data was even weaker than the surface figures with wages rising a paltry 0.1% and hourly workweek contracting to 33.8 from 33.9 hours. Overall the data suggested that US economy is clearly slowing down – fact that was affirmed by slightly weaker ISM Manufacturing report that followed the NFP and hour and half later. Nevertheless, though lackluster, US economic growth is nowhere near the danger of tipping into recession for now and that news perhaps more than anything assuaged trader’s worries and help to keep the bid underneath the buck.

Next week, the holiday shortened calendar is exceedingly light with the Fed Beige Book and ISM Services as the only releases of note. The 1.2700-1.2900 range that we have been trapped in for the past month is likely to continue until dealing desks return to full staff the week following and the markets get a better handle on whether US growth slows further or stabilizes at these levels.



...more...

[Ghost Dog]

18. Dollar hits 2-week low on growing views of future rate hike by BOJ

http://asia.news.yahoo.com/060905/kyodo/d8jujbm00.html

(Kyodo) _ The U.S. dollar fell to the upper 115 yen zone Tuesday in Tokyo, sinking below the 116 yen line for the first time in two weeks on speculation that the Bank of Japan may carry out another interest rate increase before the end of the year.

At 5 p.m., the dollar was quoted at 115.66-68 yen, against 115.90-116.00 yen at 4 p.m. Monday in London and 116.22-25 yen at 5 p.m. Monday in Tokyo. The U.S. market was closed Monday for the Labor Day holiday.

It moved between 115.57 yen and 116.21 yen in the day, trading most frequently at 115.85 yen. The day's low was the lowest since Aug. 21, when it fetched 115.35 yen in Tokyo.

The euro was quoted at $1.2823-2825 and 148.32-36 yen, compared with $1.2862-2872 and 149.10-20 yen at 4 p.m. Monday in London and $1.2850-2853 and 149.37-41 yen at 5 p.m. Monday in Tokyo.

The dollar fell below the 116 yen line in the morning and continued to weaken in the upper 115 yen range throughout the day.

Dealers said investors continued to buy the yen against the dollar and the euro a day after yen-buying was activated in the wake of strong Japanese corporate capital spending data.

The capital spending data renewed speculation for another rate increase by the BOJ before the year is out.

/...

[Ghost Dog]

19. BOJ seen keeping tightening bias despite CPI shock

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060905:MTFH14030_2006-09-05_09-05-18_T28147&type=comktNews&rpc=44

TOKYO, Sept 5 (Reuters) - The Bank of Japan looks certain to keep interest rates on hold this week, but it is also likely to remind financial markets that future hikes are still on the cards despite surprisingly soft inflation data out last month.

The BOJ policy board holds a two-day meeting on Thursday and Friday. While almost nobody expects any policy change at this meeting, they do expect the central bank to underline its view that rates should be raised gradually as prices pick up slowly after nearly eight years of decline, analysts said.

"I think the BOJ will make it clear that it has not finished with its rate hike campaign," said Koji Ochiai, senior bond strategist at Mizuho Securities.

A new series of consumer price data released in August based on a revised calculation method was sharply lower than both market expectations and the old data series.

The new numbers showed that consumer prices excluding volatile fresh foods have risen only slightly from the previous year so far in 2006. Under old calculations, core CPI has risen 0.5 percent or more every month since January.

The subdued CPI readings dampened expectations that the BOJ's second rate raise, after its first hike in six years in July, will take place before the end of this year.

Japanese bond yields fell to a 5 1/2-month low last week and interest rates futures are not pricing in the full possibility of another rate hike until March.

/...

[Ghost Dog]

20. Nikkei gains but stronger yen weighs

http://asia.news.yahoo.com/060905/3/2pfpb.html

TOKYO (Reuters) - The Nikkei average ended up 0.17 percent on Tuesday as investors sought bargains in stocks such as Internet group Softbank Corp. while a stronger yen saw profits taken on exporters such as Honda Motor Co. Ltd.

<snip>

The Nikkei eked out a 27.89-point gain to close at 16,385.96 after hitting a three-month high on Monday. The broader TOPIX index inched up 0.12 percent to 1,651.35.

Investors appear to be split over the outlook for the Japanese economy, keeping the market in check. Pessimists include Takahiko Murai, general manager of equities at Nozomi Securities, who said weak consumer price and industrial production data, among others, had led institutional investors to reallocate money into bonds from stocks.

"The Japanese economy is slowing down. Corporate earnings look strong right now and money is coming into the stock market," he said. "It looks like we might see a limit to profit growth going forward."

But Masaru Hamasaki, a senior strategist at Toyota Asset Management, said his firm projects 7 to 8 percent growth in recurring profit for the year to next March at major non-financial companies on the Tokyo Stock Exchange's first section.

That compares with an average 2 percent rise projected by those firms, according to data compiled by Shinko Research Institute, which raises the possibility that many of them could upgrade their forecasts.

"A slowdown in the economy probably cannot be avoided. But we expect corporate earnings to remain strong with factors such as cost-cutting," he said.

/...

[UpInArms]

12. U.S. Aug. corporate layoffs up 76% to 65,278

8:03 AM ET 9/5/06 U.S. AUG. CHALLENGER LAYOFFS UP 76% TO 65,278

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B0F658674%2DE79D%2D4FDD%2DAA20%2D0A77DB32617D%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- U.S. major corporations announced 76% more job reductions in August, according to a tally conducted by outplacement firm Challenger Gray & Christmas released Tuesday. Offical announcements of layoffs rose to 65,278 in August from a six-year low of 37,178 in July, the firm said. The figures are not seasonally adjusted.

[UpInArms]

14. US Aug layoffs surge, housing slowdown cited

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-09-05T113832Z_01_N05230969_RTRIDST_0_ECONOMY-LAYOFFS-CHALLENGER-UPDATE-1.XML

NEW YORK, Sept 5 (Reuters) - Planned U.S. layoffs surged 76 percent in August compared with the previous month amid signs that a slowdown in housing was starting to have an impact on employment, an independent report showed on Tuesday.

Announced layoffs in August totaled 65,278 jobs, compared with a six-year low of 37,178 in July, according to Challenger, Gray & Christmas Inc., an employment consulting firm. It was the only second time this year that monthly job cuts have increased.

<snip>

"There are some signs that the housing slowdown is taking a toll on jobs," said John A. Challenger, chief executive of Challenger, Gray & Christmas.

"Job-cutting in real estate this year is nearly double last year. However, we have not as yet seen a major uptick in job cuts in the sectors we might expect during a significant slowdown. The housing slowdown has not had a major impact on the job market, yet."

The report said the surge in planned layoffs might also be a signal of an early start to year-end cuts as companies start implementing 2007 payrolls plans.

...more...

[UpInArms]

13. Americans Concerned About Job Stability

http://cbs11tv.com/topstories/local_story_247222149.html

(CBS 11 News) DALLAS Labor Day acknowledges the contributions of American workers. CBS 11 News spent a little time Monday talking to some of the states' workers, getting their views on job stability.

<snip>

A growing number of Americans are becoming more and more concerned about the possibility of layoffs, outsourcing, and downsizing.

Angela Johnson has worked for Kroger Food Stores for 27 years. Monday she credited and saluted organized labor, in particular her union, as the key to keeping her job for so long.

“We have pension plans, health and welfare, we have wages. If it weren’t for the union I know I wouldn't be able to work there,” Johnson said.

According to the Bureau of Labor Statistics, seven million Americans are out of work. In the month of August 128,000 of them found jobs… most of them in the education field.

...more...

[54anickel]

38. You Are Working Harder & You Are Getting Paid Less

http://www.nypost.com/business/you_are_working_harder__you_are_getting_paid_less_business_john_crudele.htm

September 5, 2006 -- AMERICANS shouldn't celebrate Labor Day just once a year. They should do it twice or maybe even three times - that's how many jobs it now takes to maintain the standard of living they had in the early 1970s.

Yesterday was the 123rd anniversary of Labor Day as a national holiday. And now that people are going back to their post-summer, workaday routines, I thought it would be a good time for a reality check.

Politicians will try to make jobs an issue in the congressional election in two months. I'm not going there: The current financial state of the American household has more to do with the costs of homes, education and health care over decades, as well as the pricey amenities of life we've all come to love, than it does with political parties.

And we are paying for all that stuff with declining incomes.

Here's a figure that I find stunning.

When I was in college in 1972 (and paying about $3,000 a year total for an expensive private school), the average American had an average weekly paycheck of $334.60.

Today, the figure is just $277.96 after it's adjusted for inflation. And that is down about 90 cents a week from August of 2005.

Don't believe me? Look it up on the U.S. Department of Labor's Web site - www.bls.gov.

more...

[54anickel]

40. For young people, U.S. wages trail costs

http://www.iht.com/articles/2006/09/04/business/workers.php

The 45 million young people in the U.S. work force face a choppy job market in which entry-level wages have often trailed inflation, making it hard for many to cope with high housing costs and college debt loads.

Entry-level wages for college and high school graduates fell more than 4 percent from 2001 to 2005, after factoring in inflation, according to an analysis of Labor Department data by the Economic Policy Institute. In addition, the percentage of college graduates receiving health and pension benefits in their entry-level jobs has dropped sharply.

Some labor experts say wage stagnation and the sharp increase in housing costs over the past decade have delayed purchases of first homes among workers 20 to 35 years old.

"People are getting married later, they're having children later, and they're buying houses later," said Cecilia Rouse, an economist at Princeton University and a co-editor of a coming book on the economics of early adulthood. "There's been a lengthening of the transition to adulthood, and it is very possible that what has happened in the economy is leading to some of these changes."

Census Bureau data released last week underlined the difficulties for young workers, showing that median income for families with at least one parent aged 25 to 34 fell $3,009 from 2000 to 2005, sliding to $48,405, a 5.9 percent drop, after having jumped 12 percent in the late 1990s.

snip>

Lawrence Katz, a labor economist at Harvard University, said plenty of slack remained in the job market for young workers. The percentage of young adults who are working has dropped since 2000, largely because many have grown discouraged and stopped looking for work.

This has happened even though the unemployment rate, which includes only people looking for work, has fallen to 4.4 percent for those aged 25 to 34. It is 8.2 percent for workers 20 to 24.

"Any way you slice the data, the labor market has been pretty weak the past five years," Katz said. "But hotshot young people coming out of top universities have done fine, just like top-notch executives have done fine."

snip>

U.S. Department of Labor officials voiced optimism for young workers, noting that the Bureau of Labor Statistics had projected that 18.9 million net new jobs would be created by 2014.

"The future is bright for young people, because the opportunities are out there," said Mason Bishop, deputy assistant labor secretary for employment and training.

more...

[modrepub]

15. More Misery

Wages down for 90% of Pa. workers

By Stacey Burling
Inquirer Staff Writer

The rich really are getting richer in Pennsylvania.

And, according to a new report on wages, everybody else is getting poorer.

When adjusted for inflation, wages for the bottom 90 percent of workers in the state fell between 2004 and 2005, the report released last weekend by the Harrisburg-based Keystone Research Center said. The decline came despite rising profits and productivity, and it affects workers at all education levels.


http://www.philly.com/mld/inquirer/business/15439530.htm

[UpInArms]

17. "Ah'm gonna pik up whar ma daddy lef' off" GWB (campaign 2000)

[AnneD]

39. New law may not salvage pensions.........

WASHINGTON - When DuPont announced plans last week to scale back its traditional pension, it became the third large employer to cut back on retirement benefits since Congress passed the Pension Protection Act of 2006.

The changes were brewing long before Congress passed the bill Aug. 3. But the cuts reflect a larger reality: The system of traditional pensions is in retreat, and little in the new law is likely to stop the trend.

<snip>
"Certainly, nothing in this legislation served as an incentive for anyone to keep their plans," she said. "The American people should know this is a real missed opportunity."

<snip>
The move followed pension freezes by Tenneco, an auto parts maker in Illinois, and Blount International of Portland, Ore., which makes outdoor equipment. All the companies said they would make improvements to their employees' 401(k) savings plans.:eyes:

Yeah, the Enron folks got a good 401K too. I use to think I would end up on an iceberg a la Eskimo style retirement. I think the polar caps will be gone before then so I guess my best retirement plan will be to commit some white collar crime and land up in club fed.

edited for source.....
http://www.chron.com/disp/story.mpl/business/4162880.html

[UpInArms]

21. OFHEO: Fastest Deceleration in Home Prices in 3 Decades

10:00 AM ET 9/5/06 U.S. 2Q OFHEO HOUSE PRICE INDEX UP 4.7% ANNUALIZED

10:00 AM ET 9/5/06 U.S. 2Q OFHEO HOUSE PRICE INDEX UP 10.1% YEAR-ON-YEAR

10:01 AM ET 9/5/06 OFHEO: FASTEST DECELERATION IN HOME PRICES IN 3 DECADES

[UpInArms]

24. "housing market is cooling in a very significant way"

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B30A99599%2D1448%2D4141%2DBACA%2DDA8FFA0F8235%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- U.S. home prices were appreciating at a 4.7% annual rate in the second quarter, the slowest gains since 1999, the Office of Federal Housing Enterprise Oversight said Tuesday. In the past year, home prices are up 10.1%. The purchase-only index is up 8.3% in the past year. The deceleration in OHFHEO's home price index is the fastest in the three-decade history of the index. "These data are a strong indication that the housing market is cooling in a very significant way," said James Lockhart, OFHEO director. In the first quarter, home prices had risen at an 8.8% annualized rate, with prices up 12.8% year-over-year.

[AnneD]

63. Talk about....

putting lipstick on a hog...."cooling in a significant way". That is Wall Street babble speak which means 'holy shit, the RE is crashing and we are top heavy and cannot sucker buyers in fast enough." Couldn't happen to a nicer group of folks.

[UpInArms]

22. Treasurys swing lower after long weekend

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B3BFCFEA4%2D1DD0%2D4D9D%2D8A09%2D284ECE2D3F26%7D&symbol=

NEW YORK (MarketWatch) -- Treasury prices were under pressure early Tuesday, pushing yields above recent multi-month levels, as the market took a breather from a major rally staged in August.

The 10-year benchmark Treasury note last was down 9/32 at 100-29/32 with a yield ($TNX) of 4.760%, up a bit from its Friday close 4.725%. Bond prices and yields move in opposite directions.

The 2-year note was 2/32 lower at 100-5/32, yielding 4.791% as the 5-year note dropped 5/32 to 99-19/32 with a 4.716% yield.

The 30-year long bond rose 14/32 to 93-25/32 with a 4.902% yield.

"The market may have gotten a little bit ahead of itself in August," said Tom Girard, senior portfolio manager at Weiss, Peck & Greer. "You are seeing a bit of a pullback because the market got a little overheated in August."

"There's no fundamental reason ," he added.

During August the 10-year benchmark yield took its largest monthly decline in a year, registering a 5.2% decline, driven lower by expectations for a slowdown in the U.S. economy and a speedy end to rate increases.

...more...

[UpInArms]

23. Printing Press Hums: Fed adds bank reserves via overnight system RPS

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-09-05T133530Z_01_N05343625_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, Sept 5 (Reuters) - The Federal Reserve said on Tuesday it added temporary reserves to the U.S. banking system through overnight system repurchase agreements.

Fed funds traded at 5.25 percent -- the Fed's target for the benchmark overnight lending rate -- at the time of the operation.

For further details on the operation, see http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[54anickel]

54. Bonds fall on Fed rate hike speculation

Treasury prices ease after economic group suggests central bank may keep raising rates; dollar gains.

http://money.cnn.com/2006/09/05/markets/bondcenter/bonds/index.htm?source=yahoo_quote

NEW YORK (CNNMoney.com) -- Treasury prices slipped Tuesday after a group issued a report that suggested that the Federal Reserve may need to resume raising interest rates.

The dollar climbed against the euro and the yen.

snip>

Traders blamed declining bonds prices on profit-taking and a report issued Tuesday by the Organization for Economic Cooperation and Development that said the central bank may have to continue raising rates, Reuters reported.

Huh? Having a hard time finding much of anything on the OECD report...Found this little tidbit - sorry about the source

http://washingtontimes.com/upi/20060905-111159-1945r.htm

snip>

The Organization for Economic Cooperation and Development predicted Tuesday the overall growth of member economies will average 2.9 percent this year.

U.S. economic growth in 2006 is estimated to be 3.6 percent, Japan, 2.8 percent, and the "euro area," 2.2 percent. Canada's economy will increase at 3.1 percent, while Britain's will grow by 2.4 percent, OECD said.

snip>

"In this context, the recent data for the first half of 2006, indicating a much stronger-than-expected performance in Europe and a significantly weaker one in the United States and Japan, should not be extrapolated going forward. Indeed, following this catch-up, growth is likely to slow somewhat in Europe whilst the U.S. and Japanese expansions regain momentum.

"As concerns inflation, price stability is still some way off in the United States and, in the opposite direction, in Japan."

[54anickel]

56. Fed may have to hike, ECB should do so -OECD

&cap=U.S.%20Federal%20Reserve%20Chairman%20Ben%20Bernanke%20testifies%20to%20the%20House%20Financial%20Services%20Committee%20on%20Captitol%20Hill%20in%20Washington%20in%20July.%20%20REUTERS/Joshua%20Roberts&from=business

PARIS, Sept 5 (Reuters) - The U.S. Federal Reserve may need to raise interest rates again to tame inflation and the ECB can afford to hike euro zone rates further now that it has proof of solid economic recovery, the OECD said on Tuesday.

The Organisation for Economic Co-operation and Development said the U.S. central bank had to get to grips with stubbornly high inflation, notably fuelled by rising labour costs, and this could prove a more real concern than the spectre of a housing market collapse.

"There's a trade-off. You don't want to precipitate a crash but at the same time you want to rein in inflation," OECD chief economist Jean-Philippe Cotis told a news conference.

And abandoning earlier objections, the OECD said strong first-half growth data justified an end to expansionary monetary policy and an upwards shift to neutral European Central Bank rates.

Cotis said contrary to what many people assumed, the short-term outlook was broadly positive for U.S. growth and nothing had come of doomsday predictions in other red-hot property British and Australian property markets.

"Maybe there's a bit of dramatisation on the (regarding the U.S.) housing market."

more...

[Ghost Dog]

57. IMF chief sees global growth at 5 percent this year

http://money.cnn.com/2006/09/05/news/international/imf_economy.reut/index.htm
But Rodrigo Rato anticipates more moderate economic expansion for United States, stresses need to renew Doha Round trade talks.
September 5 2006: 1:58 PM EDT

WASHINGTON (Reuters) -- The global economy should maintain a healthy pace this year, with growth likely to reach 5 percent in 2006, led by China and India, the managing director of the International Monetary Fund said Tuesday.

Rodrigo Rato told reporters that growth in the United States should moderate to a more sustainable level, largely reflecting the slowdown in the housing market and the impact from higher interest rates.

"We expect next year to be another year of solid growth, with expansion in Europe and Japan supporting global demand, even if the U.S. economy cools," he added.

Still, Rato said risks to the outlook had increased, with high oil prices a threat to inflation and growth.

"The risk of inflationary pressures materialized in a strong way, is certainly a key question for monetary authorities worldwide," he noted.

He said the risk of a disorderly adjustment of global economic imbalances - the deficits in the United States and surpluses in Asia and oil-producing nations - had not been removed.

/...

Horses for courses...

[Ghost Dog]

58. EU Is Expected To Raise 2006 Growth Outlook - Economists

http://www.nasdaq.com/aspxcontent/NewsStory.aspx?cpath=20060905\ACQDJON200609051405DOWJONESDJONLINE000614.htm&selected=9999&selecteddisplaysymbol=9999&StoryTargetFrame=_top&mkt=WORLD&chk=unchecked&lang=&link=&headlinereturnpage=http://www.international.na

BRUSSELS -(Dow Jones)- The European Commission will increase its growth forecast for 2006 Wednesday when it publishes its latest economic assessment for the European Union and euro zone, four private-sector economists surveyed by Dow Jones Newswires said Tuesday.

Three of the four economists surveyed forecast E.U. and euro-zone economic growth at 2.5% in 2006, and one predicted a 2.2% expansion. All expect the commission to raise its forecast.

In February, the commission predicted economic growth of 2.1% for the euro zone and 2.3% for the E.U. as a whole.

The commission will publish its new forecasts around 0945 GMT and Economic and Monetary Affairs Commissioner Joaquin Almunia will give a press conference around 1015 GMT. The E.U. will refrain from giving any new predictions for next year's growth, said spokeswoman Amelia Torres.

The commission will publish forecasts for growth and inflation in 2006 for both the E.U. and the euro zone. It will also release individual estimates for the five biggest economies - Germany, the U.K., France, Italy and Spain - plus Poland, which together account for almost 80% of the E.U.'s gross domestic product. Poland is included because it is the biggest economy of the 10 countries that joined the bloc in 2004.

"Growth in the second quarter was above most people's expectations," and followed stronger than expected growth in the first quarter of 2006 and in the last quarter of 2005, said Marcus Heider, economist at Deutsche Bank in London. He points to strong rises in the first and second quarters of this year.

Much more uncertainty hangs over 2007. Slower growth in the U.S. and Asia could hit European exporting companies. In addition, budgetary tightening in Germany and Italy could reduce domestic consumption.

/...

[Ghost Dog]

59. European Currency Traded Choppy Against Franc Amid Swiss CPI Data

http://www.tradingmarkets.com/.site/news/FOREX%20NEWS/358876/

(RTTNews) - The Euro showed choppy trading against its Swiss counterpart Tuesday in New York. The pair remained range-bond throughout much of New York trading. This came as Swiss consumer price index data reported in line with economists expectations during the early morning hours. As of 1:35 pm ET, the Euro was worth 1.5814 francs.

This came amid the release of mixed Euro-zone economic data. Euro-zone PMI services data for the month of August printed at 57.1, below the expected 57.5 and the previous reading of 57.9. Shortly after, Euro-zone retail sales data for July, reported higher-than-expected, showing a month-to-month reading of 0.6%, compared to 0.5% in June. Traders now turn their attention to German factory orders data due out Wednesday.

/...

[Ghost Dog]

60. Euro Fetched 11-day High Against British Pound Tuesday

http://www.tradingmarkets.com/.site/news/FOREX%20NEWS/358878/

(RTTNews) - The Euro advanced against the British pound Tuesday in New York. The pair gained momentum during the early morning hours, pushing up to a 11-day high of about 0.6770. Soon after, the European currency entered a range against its British counterpart. This came amid the release of lower-than-expected British PMI and BRC retail sales data. As of 1:35 pm ET, the Euro was worth 0.6766 of a pound.

This came amid the release of mixed Euro-zone economic data. Euro-zone PMI services data for the month of August printed at 57.1, below the expected 57.5 and the previous reading of 57.9. Shortly after, Euro-zone retail sales data for July, reported higher-than-expected, showing a month-to-month reading of 0.6%, compared to 0.5% in June. Traders now turn their attention to German factory orders data due out Wednesday.

/...

[54anickel]

69. Makes you wonder who's off script in these articles. Seems the powers

that be in in charge of the world's finances can't agree on their spin these days. Makes me wonder just how bad things really are.

[UpInArms]

25. 10:09 EST numbers and it's only a flesh wound blather

Dow 11,461.35 -2.80 (-0.02%)
Nasdaq 2,193.20 +0.04 (+0.00%)
S&P 500 1,311.06 +0.05 (+0.00%)
10-Yr Bond 4.751 +0.025 (+0.53%)

NYSE Volume 323,643,000
Nasdaq Volume 279,051,000

10:00 am : Major averages are still on the defensive but mixed industry leadership and market internals offer little conviction on either the bullish or bearish side of the aisle. Of the six sectors trading lower, Technology is pacing the way (-0.5%), which is not all that surprising after it had such a huge run-up in August (+8.4%). Health Care is also a notable leader to the downside, as pharmaceutical stocks lose ground after Bristol-Myers (BMY 22.69 -0.26) followed the lead of Sanofi-Aventis (SNY 44.54 -0.83) and lowered its FY06 earnings outlook. Financials, though, is providing some modest leadership and preventing the indices from slipping even further into the red as an analyst upgrade on Lehman Brothers (LEH 65.50 +1.95) helps the rate-sensitive sector deal with a rise in borrowing costs as yields at five-month lows prompt bond traders to lock in gains. DJ30 -16.01 NASDAQ -4.78 SP500 -1.25 NASDAQ Dec/Adv/Vol 1275/1203/216 mln NYSE Dec/Adv/Vol 1279/1381/166 mln

09:40 am : Market stumbles out of the gate as investors find few catalysts following the long Labor Day weekend to extend the August rally. Meanwhile, crude oil prices are off nearly 1% near $68.50 a barrel following a deep-water discovery in the Gulf that could become the nation's biggest new domestic source of oil, providing some early relief. However, profit-taking throughout the bond market lifting yields across the curve, coupled with the absence of any notable economic or earnings data to set a more definitive tone to trading, have stalled early follow-through efforts.DJ30 -17.05 NASDAQ -7.45 SP500 -1.48 NASDAQ Vol 99 mln NYSE Vol 78 mln

[Ghost Dog]

26. Base metals charge higher as funds buy

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060905:MTFH21043_2006-09-05_13-54-21_L05207047&type=comktNews&rpc=44

LONDON, Sept 5 (Reuters) - Base metals rallied sharply on Tuesday, led by gains of between three and five percent in copper, nickel and zinc on chart-driven fund buying, dealers said.

"The buying is coming from the systematic trading funds and it is fairly predictable. The general expectation last week was that the upside would be probed after we failed to break lower," a trader said.

"Supply is another issue. The worries about short-term supply problems have outweighed any concerns about long-term economic growth. The question is whether consumers will step in and chase this higher," he said.

Analysts said investment funds might be pouring their September allocation into base metals, driving prices up.

"This could be new fund money for the start of the month. The dollar is weaker, which in the absence of anything else also means new buying," Man Financial analyst Edward Meir said.

/...

[Ghost Dog]

27. NY gold, silver surge on reopen from holiday

http://yahoo.reuters.com/news/articlehybrid.aspx?type=comktNews&storyID=2006-09-05T142338Z_01_N05371021_RTRIDST_0_MARKETS-PRECIOUS-COMEX.XML

NEW YORK, Sept 5 (Reuters) - Precious metals rose sharply early Tuesday in New York as traders returned from the last long weekend of the summer in a buying mood, shrugging off weaker crude oil prices and a mixed dollar.

Though floor traders were still trying to get their bearings after Monday's U.S. Labor Day holiday, there was some speculation that metals were benefiting as investors grew more sour on crude oil after recent declines in the price.

"I'm thinking there is some money coming out of the energies and coming into metals," said a floor broker. "We saw some fund buying earlier last week. We continue to see a little bit of buying here this morning."

Silver took a leading role overnight, but gold sprinted ahead at the open on the COMEX division of the New York Mercantile Exchange.

December gold <GCZ6> at 9:38 a.m. EDT (1338 GMT), was up $12.10, or 1.9 percent, at $644.70 an ounce, trading to a 25-day high at $646.50 from $631.60, the bottom overnight.

Another broker said the floor considered $649 an ounce the next resistance point for the benchmark contract.

Spot gold <XAU=> fetched $636.00/80, up from $624.85/625.85 an ounce when trading wrapped up Friday afternoon. Tuesday's morning fix in London was $629.75.

"It is quite a sharp jump when you consider oil is well entrenched below $70 and the U.S. dollar at $1.28 against euro is relatively strong," said Bernard Hunter, a director of precious metals trading at ScotiaMocatta in Toronto. "Gold's reaction is probably breaking away from those traditional indicators."

/...

[Ghost Dog]

29. Toronto stocks climb on rising gold, Inco drops

http://yahoo.reuters.com/news/articlehybrid.aspx?type=comktNews&storyID=2006-09-05T142630Z_01_N05340729_RTRIDST_0_MARKETS-CANADA-STOCKS.XML

TORONTO, Sept 5 (Reuters) - Toronto stocks rose near the start of trading on Tuesday as rising gold prices lifted resource shares, though shares of Canadian nickel giant Inco (N.TO: Quote, Profile, Research) fell after U.S.-based Phelps Dodge Corp. (PD.N: Quote, Profile, Research) abandoned plans to buy Inco due to lack of shareholder support.

The Toronto Stock Exchange's S&P/TSX composite index <.GSPTSE> was up 31.74 points, or 0.3 percent, at 12,176.84.

Only four of the TSX index's 10 main groups rose, but a 1.6-percent boost in the materials group and a 2.2-percent rise in its gold subindex were enough to prop up the market.

/...

[54anickel]

49. Seems strange, gold and buck heading up together. "Feels like" funds

placing their bets. Pump it up, since oil will probably stay capped through the election season. Gold seems to be the last place the "general public" looks for evidence of inflation. :shrug:

[54anickel]

28. Tread Carefully With New Treasury ETFs

http://www.thestreet.com/funds/etftuesday/10306942.html

snip>

Ameristock's new bond ETFs will be more of a benefit to people who trade actively, or to institutional managers, who now will have a fast and easy way to more narrowly manage duration, make short-term directional bets on interest rates, and quickly reallocate the makeup of their bond portfolios.

Unfortunately, these funds may not be right for do-it-yourself investors looking for steady income.

According to the Ameristock prospectus , the bonds (or notes) owned in each fund will be from the most recent auction for that maturity -- sort of. Each of the funds will blend together maturities, and possibly futures contracts, to "create" the yield associated with the targeted maturity for each given ETF.

The downside of this strategy is that investors are not locking in what might be a favorable yield.

snip>

In late June, five-year Treasury notes yielded 5.15% to 5.20%. The investor who bought a five-year Treasury bond in June would get that 5.15% until maturity. But the investor who bought the five-year ETF, had it existed in June, would now be facing a much lower yield. Though there's always the chance the reverse situation will happen, giving the ETF a higher yield, an investor counting on a particular income stream will face perpetual uncertainty with these funds.

In addition, the new ETFs will pay a dividend only once a year, which is rather quirky. Specifically, the wording in the prospectus reads: "Each fund pays out dividends to investors at least annually and may pay them on a more frequent basis."

more...

Looks like those meetings between Treasury and Wall Street have devised a way to cover the days when no one shows up at the auction. :eyes:

[54anickel]

30. Record Share Repurchases by U.S. Companies May Aid Stock Rally

http://www.bloomberg.com/apps/news?pid=20601084&sid=ajsKXBTDMx_0&refer=stocks

Sept. 5 (Bloomberg) -- U.S. companies are spending record amounts of money on their shares, and the repurchases may help stocks exceed the five-year highs reached earlier in the year.

snip>

``Supply's shrinking,'' said Kenneth Fisher, chairman of Fisher Investments Inc. in Woodside, California, who oversees $32 billion. ``That's got to be bullish.''

Stocks rose last week as data on inflation, job growth, manufacturing and consumer confidence reinforced the Federal Reserve's view that economic growth is slowing gradually.

The S&P 500 ended the week 1.1 percent below this year's peak of 1325.76, reached May 5, when the index climbed at the highest level since February 2001. U.S. markets were closed yesterday for the Labor Day holiday.

Reports tomorrow may provide more evidence that the economy is meeting the Fed's expectations, suggesting policy makers may be done raising interest rates after 17 increases in two years.

Advisers' Optimism

The Institute for Supply Management may say banks, builders, retailers and other service companies expanded last month, according to a survey of economists by Bloomberg News. Productivity probably rose in the second quarter at a faster pace than first reported, another survey showed.

Speculation that the Fed won't lift rates sent optimism about U.S. stocks to a five-week high, according to the latest survey by Investors Intelligence, a New Rochelle, New York-based financial newsletter.

The number of bullish newsletter writers rose during the week ended Aug. 25 by 2.1 percentage points, to 42.1 percent. Bearish, or pessimistic, writers fell to 33.7 percent, a six-week low, from 34.7 percent.

more...

[54anickel]

33. `Blank Check' IPOs Alarm NASD Amid Resurgence of Unnamed Deals

http://www.bloomberg.com/apps/news?pid=20601087&sid=aCL3tvbKfFUc&refer=home

Sept. 5 (Bloomberg) -- A type of initial public offering that vanished in the 1990s in a wave of scandals is making a comeback, and regulators say they are concerned investors may be defrauded again.

NASD, which polices more than 5,000 U.S. brokerage firms, says it is investigating the resurgence of ``blank checks'' -- shell companies that raise money in public markets without saying what they will spend it on.

This year, blank-check companies have sold $2.2 billion of stock in 28 offerings, and $4.3 billion more in new issues is planned with help from some of Wall Street's best-known banks and underwriters, including Citigroup Inc. and Merrill Lynch & Co., according to data compiled by Bloomberg. The data from filings show that firms have earned fees averaging 6.4 percent, generating a potential $417 million.

``I'm not sure that all that's going on with these securities is above-board,'' says James Shorris, head of enforcement for the Washington-based NASD, formerly known as the National Association of Securities Dealers Inc.

Shorris says he is troubled by the possibility that the renewed trust in blank-check deals will trigger new abuses. NASD is examining whether anyone is trying to artificially create or inflate demand for the shares.

much more....was slow to load but worth the read

[54anickel]

35. Taking aim at big 'retention bonuses' for managers of bankrupt firms

http://www.iht.com/articles/2006/09/05/business/pay.php

The U.S. Justice Department is setting the stage for what could become the first major test of a new provision in American bankruptcy law aimed at curbing large retention bonuses for top managers.

The agency has joined with unions and creditors of Dana Corp., an auto parts company in bankruptcy protection, in opposing a proposed pay system for top executives of the company.

The U.S. bankruptcy trustee, a Justice Department employee charged with ensuring that bankruptcy laws are complied with, also raised questions about the integrity of the proposed compensation plan.

She notified the court that she might request an independent examiner to investigate the "proposed executive compensation scheme" and the manner in which it was developed. Diana Adams, the trustee, said the proposal "appears to fall far short of the integrity required for this court's approval."

snip>

The provision was inserted in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to win support from Democrats, who had complained that executives received lavish pay packages while citing a company's financial distress as a reason to reduce the pay and benefits of ordinary workers. The provision is known to lawyers by the numbers of the two new sections, 503(c)1 and 503(c)2.

In a submission to the court last week, the trustee defined the issue as raising the question: "Can debtors circumvent the restrictions and evidentiary burdens enacted by Congress in Sections 503(c)1 and 503(c)2 - provisions designed specifically to limit and restrict lavish insider retention and severance burdens - by avoiding the mere mention of the statute and transparently recharacterizing these payments as 'incentive' payments?"

snip>

"At a time when the debtor's work force faces great uncertainty and angst," she wrote, the company "proposes to substantially insulate the six executives. It is exactly this type of managerial overreaching that led to the recent enactment of Section 503(c), and exactly the type of insulation the statute is designed to prevent."

more...

[54anickel]

42. It is not just America’s car giants that are in trouble. So are those in E

It is not just America’s car giants that are in trouble. So are those in Europe
Fields of cars under gathering clouds

http://www.economist.com/agenda/displaystory.cfm?story_id=7854907

EVER since Europe’s big car companies put their houses in order a decade ago and started making money, their biggest worries have been sluggish demand and ever-tightening rules on emissions laid down by European regulators. Now both fears are proving justified. This week Brussels threatened to get tough as it becomes clear that the industry will fail to meet a voluntary 25% cut in carbon-dioxide emissions promised by 2008. At the same time, the business climate has taken a turn for the worse.

Only Fiat, coming round after a near-death experience, is enjoying an exhilarating recovery, largely due to the success of the Punto. But elsewhere the big carmakers are in trouble. The strength of the euro is eating into profits on German exports to America and bloated labour costs at Volkswagen’s factories are squeezing margins in Europe. The French pair, Peugeot and Renault, have been hit by tepid sales, ageing product lines and rising raw-material prices. And they now have to cope with serious competition from Japan’s Toyota.

Renault’s operating margins fell alarmingly in the first half of the year. Although its bottom-of-the-range Logan is prospering, Renault’s Modus, a compact family car, has flopped. Carlos Ghosn, Renault’s boss, has a recovery plan involving new models and a push into luxury cars—where Renault has produced a string of eccentric duds in recent years. But if Renault’s problems worsen, he may need to cut capacity. This will be difficult. The French state owns 15% of Renault and the government is terrified of taking on powerful unions. Mr Ghosn’s reputation, after his legendary turnaround at Nissan, suggests that he should restore Renault to peak form. Yet he has distractions: as well as running Renault and Nissan, he is exploring tie-ups with General Motors or Ford in America.

Peugeot’s problems are similar. But analysts expect Peugeot to bounce back over the next couple of years. It is about to renew half of its models and has begun low-cost production in eastern Europe.

Perhaps the darkest clouds are gathering over Volkswagen. Outwardly, it appears that Europe’s market leader is going from strength to strength. It has just increased its share of the market to 19.2%, half as much again as the number two, Peugeot. But VW is trying to cut costs by getting its German employees to work more hours for the same pay. Talks with the unions are about to begin. Earlier this year the company said it needed to cut 20,000 jobs in its German factories to improve productivity, despite earlier promises not to shed workers.

The pain of its high labour costs is felt most keenly in America, where VW lost nearly $1 billion last year. The cars it sells there are made either in Germany, with costs further bloated by an unfavourable exchange rate, or in Mexico. Workers there recognise the bargaining power this gives them and have been pressing for hefty wage rises.

more...

[Ghost Dog]

44. Humm, yeah. Let's see how those new Peugeot designs work out.

(There are no Peugeots or Citroens in the USA, right?)

Me, I'm a lifelong Peugeot buyer, although my first car many years ago was an ancient VW Beetle and, while my personal vehicle is an 8-year-old Peugeot diesel 306 break, what we usually drive around town is my partner's SWB Toyota RAV 4 (small, sweet, but relatively inefficient).

I expect to see further Japanese-European integration in this industry in which design, mechanical reliablility and energy-efficiency are at a premium.

[54anickel]

43. Russia's Consumer Borrowing Feeds Asset-Backed Market (Update1)

http://www.bloomberg.com/apps/news?pid=20601009&sid=aHRzp5KfUiec&refer=bond

Sept. 5 (Bloomberg) -- A record amount of consumer borrowing in Russia, for everything from foreign cars to DVD players, is creating a new bond market.

Russian banks sold $1.3 billion of asset-backed debt in the last 12 months, compared with $350 million in the previous year, according to data compiled by Bloomberg. Sales may top $10 billion by 2008, said Levan Zolotarev, a senior vice president at Moscow-based Russian Standard Bank ZAO, the biggest issuer of the securities.

The bond sales are enabling banks to lower their funding costs and increase the amount of credit offered in car showrooms and shopping centers like Moscow's Mega mall, where $2,000 Italian fur coats are sold. Russian Standard Bank raised 300 million euros ($386 million) in March in a sale that shaved more than 1.5 percentage points off its previous borrowing costs.

``For Russian issuers, asset-backed bonds give them access to a very deep investor base that they couldn't otherwise reach,'' said Mike Strange, a director at Barclays Capital Inc. in London, who helped arrange Russian Standard Bank's deal. ``For many of them, this is cheaper funding than they could get in the unsecured market.''

snip>

Consumers are still borrowing only about 5.1 percent of their annual income, compared with 70 percent in the U.K. and 55 percent in the euro zone, Russian Standard Bank's data show.

President Vladimir Putin is pushing the development of the mortgage market as a way of making housing more affordable, one of four ``national projects.''

more...

[54anickel]

45. Home-building measure's effect unclear

Texas Residential Construction Commission

http://www.chron.com/disp/story.mpl/business/4162878.html

snip>

Consumer groups agree the city's check will give the state one more way to prevent the unregistered from building, but they warn consumers not to expect a lot.

"It's worthless and it's meaningless, except cities can say you can't take this permit out unless you're registered," said Janet Ahmad, head of HomeOwners for Better Building. The Better Business Bureau echoed those sentiments, saying that while the registration doesn't give the consumer much power, it's better than nothing.

But Alex Winslow of Texas Watch noted it doesn't take much to be registered in the state. There aren't any tests or continuing education requirements.

snip>

Consumer groups have long said the commission was created at the behest of builders, for builders.

The 2003 law that created the commission requires home buyers to go through a commission-run inspection and dispute resolution process before they can proceed to binding arbitration or file lawsuits against builders.

Builders, who lobbied heavily for the law, said the process would reduce lawsuits and help resolve disputes quickly and less expensively.

more...

[54anickel]

46. Storm Clouds to the East?

http://www.321gold.com/editorials/tanashian/tanashian090506.html

I was browsing around the Resources page of the Biiwii.com website recently, checking links I hadn't visited for a while to make sure they are alive and well. In the section entitled The Inflation/Deflation Debate I found myself reading from The Great Depression, which is actually part of a website on poetry from the University of Illinois at Urbana-Champaign that presents a vivid picture (literally) of the depression. I took particular note of the following passage from a section called About the Great Depression:

"The Great Depression began in the United States but quickly turned into a worldwide economic slump owing to the special and intimate relationships that had been forged between the United States and European economies after World War I. The United States had emerged from the war as the major creditor and financier of postwar Europe, whose national economies had been greatly weakened by the war itself, by war debts, and, in the case of Germany and other defeated nations, by the need to pay war reparations. So once the American economy slumped and the flow of American investment credits to Europe dried up, prosperity tended to collapse there as well. The Depression hit hardest those nations that were most deeply indebted to the United States, i.e., Germany and Great Britain. In Germany, unemployment rose sharply beginning in late 1929, and by early 1932 it had reached 6 million workers, or 25 percent of the work force. Britain was less severely affected, but its industrial and export sectors remained seriously depressed until World War II."

"Uhhgg!" said I. That first response, if articulated more clearly would have come out as "Wait a minute, I hear a lot of chatter out there, including some of my own, about the debt-ridden USA being in danger of an economic implosion that could set off a global depression, at least in so far as creditor nations need the vast debt-for-consumption engine the US has become to fuel their economies". But let's think about this for a moment. The US can, does and most likely will continue to inflate its money supply as needed to keep its debt situation from lighting the fuse to a bomb of epic proportions. But what happens if the fuse is lit elsewhere? What about China, a country with a murky (at best) banking system and a debt-for-growth (the yin to our debt-for-consumption yang) economic system? A growth story running well-publicized surpluses with the US, year after year. Lazy, greedy bulls think this can go on forever. Conventional doomsters bearish on the US buy commodities and hop aboard a global train that is passing the United States by. I am not currently long the "China Story" nor, by extension, the general commodity story. Yes, China is in the process of industrializing (like the US of the early 20th century) and they are recycling USD reserves into "resources" (read: necessary commodities for infrastructure and gold for an alternative to the US debt note), but none of this makes them immune to a deflationary hiccup along the way to a big picture of ascendancy, especially given that saving is ingrained in the culture.

I will leave it to global economists to sort out the extent to which China is propped on an unsound financial and economic foundation, but it seems to me that a real economic Armageddon, if it is to happen in the US, could start with our creditors who, led by the likes of China and Japan are major players in the US Dollar via the US Treasury markets. Until crisis strikes at home, and our creditors begin to sell off assets for liquidity, we may not enter a terminal stage of this great economic experiment. When will that be? What will the trigger be?

more....

Some interesting links in that article. The pictures from the depression are quiet powerful. Could it happen that way again?

A Photo Essay on the Great Depression
http://www.english.uiuc.edu/maps/depression/photoessay.htm

[54anickel]

47. Peter Schiff vs. Art Laffer

http://www.kitco.com/ind/Schiff/sep52006.html

In my most recent appearance on CNBC I debated Arthur Laffer, who gained fame during the Reagan administration for sketching his controversial "Laffer Curve" on a cocktail napkin. The encounter reaffirmed my belief that the same napkin would probably be large enough to hold the sum total of his economic wisdom.

In the pointed debate, the impeccably genial Mr. Laffer claimed that the U.S. economy has never been healthier, was not dependant on housing, and will be unfazed by higher interest rates. He described current monetary policy as "spectacular", declared wealth had risen dramatically, asserted our trade policy was working “beautifully,” attributed our trade deficit to foreigners outsourcing their monetary policy to America, and claimed that history had shown that such external deficits were not harmful.

Although I would love to refute all of his absurd positions, two in particular stand out as worthy of discussion.

First, Laffer compared today’s current account deficits to those experienced during America’s first two hundred years as a developing nation. This flawed comparison ignores that as a developing nation America borrowed to invest. Those current account deficits funded the construction of vast infrastructure, such as roads, canals, ports, and rail roads, as well the formation of capital equipment, farms, and factories, all of which fueled American productivity. Such investments enabled the production of vast quantities of consumer goods, which America sold back to its creditors, to both pay interest and retire principle. In the end, America's creditors got consumer goods, and America became the wealthiest industrial nation the world had ever seen, in the process turning its current account deficits into enormous surpluses.

In a “night and day” contrast, today's current account deficit has the much more limited role of solely financing consumer spending. Borrowing to produce is the way poor nations become rich. Borrowing to consume is the way rich nations become poor. By squandering borrowed money on consumption, America has no way to repay the principal of its debts, let alone the interest. Borrowing to build factories is not the economic equivalent of borrowing to buy flat panel, high definition televisions, and it’s amazing that Laffer can't see the difference.

more...

[54anickel]

52. The Tragedy of Busted Myths (Willie)

http://www.kitco.com/ind/Willie/sep052006.html

Mythology is powerful. Just a few thousand years ago, men would go to war over strange beliefs about gods and goddesses, or make decisions of state, or act upon the fate of cities and hamlets, or enter into big trade agreements, or embark on grand voyages, or agree to marriage, all after consulting the oracles. They were the gurus of their day, replaced today by economists from many corners. Budget advisors, brokerage analysts, government spokesmen, and academic charlatans are the modern soothsayers, hardly ever correct, always revered, never understood. It seems whenever things are about to go badly, we face more economic myths in the process of being shattered, and are soon subjected to new ones. In their failed wake, we install more controlling (corrupting) mechanisms like the Plunge Protection Team after crises like the 1987 Black Monday and the 2000 Tech Telecom bust.

Once again the motive in promoting silly myths is the same, or at least the nucleus motive is the same. Domestically, that is to deceive the hapless ignorant hopeful public to continue to trust the leadership out of Washington DC and New York City, to continue to remain invested in the Wall Street game, to continue to participate in the consumption game, to avoid a panic and head for exits before the losses mount. On the foreign front, the motive is to encourage other nations to continue to send their hard earned savings into the Great Black Hole that is the USEconomy, to continue to supply and satisfy its desperate credit needs, to continue to pay for the entry fee for selling in its vast marketplace. The unspoken motive is to enable the aristocrats to continue to churn their machinery, to ply their trade of exploiting the great paper game, to further the squeeze on the middle class. In fact, the middle class is the greatest loser from inflation’s impact and heavy cost.

INFLATION WRECKAGE

Inflation has its hidden costs. Writers, analysts, and pundits catch the easy victims, like savers who are robbed of the stored value from the drip drip drip of erosion. Like small-time participants who shun the opportunity to grow big. Rising wages, which at first seem like an advantage from a steadily inflating economic system, have turned on the masters of the inflationary machinery. Job outsourcing to Asia has ripped the manufacturing foundation of the USEconomy clean off its mooring and capstone, deprived it of legitimate wealth generation. Consequently, the participants of our mfg-less society have been deceived into believing that consumption within retail chains can stand in its place. It offers the benefit of cleaner air, less sweat, and more fun. What’s not to like? Let’s go shopping, the great medication for the depressed. Instead of factories belching out smoke, noxious fumes, and rendering its workers musclebound but with damaged bodies from chemical intake, we have clean tidy shopping malls, nifty prevalent consumer retail chains, really cool electronic stores, and nice smelling furniture marts. Complimenting the networks of consumer havens are our homes, the veritable piggy banks. Who needs to save anymore, so passé? We have mutual funds and trading accounts. So we have suffered a deadly transition from making products in an industrial setting, wherein added value is gained from human labor with the aid of sophisticated machines. We now stand with one foot in the financial credit spin cycle replete with mortgages and car loans and vendor financed sales, not to mention the world of stocks and bonds, and the other foot in the service collage known to keep our devices and grounds in working order and looking spiffy.

Is this progress? No way! It is a tragedy in the making, fully denied. We crossed the Rubicon ten years ago, maybe as long ago as the 1971 date. At that time, we both abrogated the Bretton Woods gold standard for the USDollar, and embraced the USGovt social & military contract. The dual pact often called “Guns & Butter” committed to provide a vast social safety net (despite claims we are not socialist) and to wage war wherever we can. The Medicare plan is the latest socialist plan passed under the current Administration is certain to worsen the national bankruptcy condition, fully fingered by the St Louis Fed this summer. So since 2001 we have a grand scheme identified by Nationalism & Socialism, the former brandished proudly, the latter quietly engrained more deeply, all against a backdrop of growing fear, withering civil liberties, and wider war. My concept is that military actions represent the ultimate in fixed business investment, although with as much cleared paths for trade benefits on the positive side as global backlash on the destructive side. Whereas the multiplier effect reaps benefits in six to seven steps from trickle down in commerce, military and defense spending reaps benefits mainly to the contractors in an abrupt one to two steps as some degree of destruction results. On rare occasion, military contract engineering has civilian benefits, however far more being evident in NASA space research.

The most reckless and irresponsible phase change has been the overdue dependence within the USEconomy on the inflated equity of the entire housing sector. Indeed it sustains the system to a great degree. Americans have not saved actively since the mid-1990 decade, when Greenspan endorsed irrational exuberance by warning about it, but continuing to feed the destructive damaging condition. Several years later, Greenspan actively shocked the world by claiming that gains in home equity suddenly realized should be regarded as legitimate wealth. This is unprecedented in the modern era for a central banker. Worse still, in 2005 Greenspan added insult to injury by stating that “People who took on too much debt were desirous of financial harm.” He urged the housing bubble stampede, then stepped out of its path on political fallout. The central question should be “Will the Greenspan legacy be directly linked to the upcoming crisis in housing and the USEconomy, which is of his own making?” Given the utterly imbecilic naïve confounded lack of comprehension of economic matters, blame is likely to go to the current USFed Chairman Bernanke by the present public and current leaders alike.

more...

[54anickel]

48. 1:09 numbers and yada

Dow 11,453.51 -10.64 (-0.09%)
Nasdaq 2,199.35 +6.19 (+0.28%)
S&P 500 1,311.84 +0.83 (+0.06%)
10-yr Bond 4.779 +0.053 (+1.12%)
30-yr Bond 4.929 +0.056 (+1.15%)
NYSE Volume 1,149,810,000
Nasdaq Volume 1,015,339,000

1:00 pm : More of the same for stocks as the Nasdaq continues to outpace its blue chip counterparts to the upside. The recent turnaround in tech, led by strength in semiconductors (+0.9%) and software (+0.7%), is still acting as the biggest source of support for the index. However, the tech-heavy Composite is also getting noticeable contributions from retail (e.g. COST +2.0%, SHLD +3.7%), biotech (e.g. AMGN +1.5%, MEDI +1.9%) and transportation (e.g. EXPD +1.0%). DJ30 +1.02 NASDAQ +9.28 SP500 +1.76 NASDAQ Dec/Adv/Vol 1138/1781/992 mln NYSE Dec/Adv/Vol 1255/1904/712 mln

12:30 pm : Market is off its best levels as the afternoon session gets underway but continues to maintain its positive footing. Energy (+1.1%) is still providing the bulk of support while the Materials sector (+0.8%), as shareholders applaud the decision by Phelps Dodge (PD 93.26 +2.51) to take its $17.4 bln buyout offer of Inco Ltd (N 76.86 -0.84) off the table, is also turning in a notable performance. An analyst upgrade on Freeport McMoRan (FCX 61.65 +2.29), which has left Diversified Metals & Mining (+3.7%) as one of today's best performing S&P industry groups, has also helped the Materials sector extend its 6.0% year-to-date advance. DJ30 +12.65 NASDAQ +11.20 SP500 +2.89 NASDAQ Dec/Adv/Vol 1065/1827/908 mln NYSE Dec/Adv/Vol 1201/1928/650 mln

12:00 pm : Market is trading at its best levels midday as investors embrace easing inflationary pressures tied to a pullback in oil prices to three-month lows that hasn't sacrificed leadership in the Energy sector due to a breakthrough discovery and easing geopolitical concerns.

Since inflation is the key variable in the stock market outlook, and it now appears as if inflation will remain restrained enough to prevent the Fed from "going too far" in raising interest rates, the reduced downside risk for equities is thus acting as a modest source of early support. The improved outlook has prompted us at Briefing.com to raise our Market View to Moderately Bullish. Crude oil prices are off 1.1% at $68.40 a barrel amid signs that Iran may enter further negotiations about its nuclear program and reports that Chevron (CVX 67.01 +2.18), Devon Energy (DVN 70.44 +6.29) and Statoil (STO 28.11 +0.60) have tapped a new deep-water discovery in the Gulf that could become a major new domestic source of oil.

Aside from Energy's leadership, a modest gain in Financials fueled by M&A activity and an analyst upgrade on Lehman Brothers (LEH 65.75 +2.20) is helping the rate-sensitive sector overlook a rise in borrowing costs as yields at five-month lows and the absence of economic data to further support the Fed's holding pattern prompt bond traders to lock in gains. Compagnie Generale de Geophysique (GGY 31.43 -1.84) has agreed to buy Veritas DGC (VTS 69.29 +7.11) for $3.1 bln while Merrill Lynch (MER 74.27 +0.48) has offed to buy National City's (NCC 34.91 +0.34) subrime mortgage unit for $1.3 bln. DJ30 +21.93 NASDAQ +12.44 SP500 +2.96 NASDAQ Dec/Adv/Vol 1061/1794/804 mln NYSE Dec/Adv/Vol 1220/1876/576 mln

11:30 am : Stocks are back in the green, for now, but the market's advance is modest at best. Providing the bulk of support is Energy (+0.9%), as noticeable gains in Chevron (CVX 66.97 +2.14) and Devon Energy (DVN 70.55 +6.40) -- two of the three companies responsible for discovering one of the most significant finds for the domestic oil industry since the Alaska North Slope was discovered in the 1960's, help overshadow a 1.1% pullback in the price of crude which typically prompts consolidation in everything from explorers to refiners. DJ30 +6.57 NASDAQ +4.56 SP500 +0.75 NASDAQ Dec/Adv/Vol 1234/1544/674 mln NYSE Dec/Adv/Vol 1283/1773/496 mln

11:00 am : Recent recovery efforts are short-lived as sellers regain the upper hand. After opening higher amid reports it might lay off as many as 10,000 workers, further deterioration in Intel (INTC 19.66 -0.22) -- today's worst performing Dow component (-1.1%), continues to put pressure on the overall market, especially Technology. Analyst downgrades on Texas Instruments (TXN 31.59 -0.34) and Novellus Systems (NVLS 27.14 -0.41) are currently outweighing an upgrade on Advanced Micro Devices (AMD 25.75 +1.09).DJ30 -16.97 NASDAQ -3.48 SOX -0.4% SP500 -1.43 NASDAQ Dec/Adv/Vol 1275/1460/534 mln NYSE Dec/Adv/Vol 1345/1656/390 mln

10:30 am : Indices bounce off morning lows and have recently inched above the flat line, spearheaded in part by a turnaround in Industrials after Caterpillar (CAT 68.35 +1.08) said it is raising prices on machinery equipment and engines. Consumer Discretionary has also turned positive, as retailers getting a boost at the expense of oil's decline helps to offset a 5.6% sell-off in Viacom (VIA 34.90 -2.07) following the surprise departure of its CEO. DJ30 +1.44 NASDAQ +2.33 SP500 +0.24 NASDAQ Dec/Adv/Vol 1197/1422/384 mln NYSE Dec/Adv/Vol 1186/1685/272 mln

[54anickel]

55. 2:10 - the magical hour

Dow 11,468.72 +4.57 (+0.04%)
Nasdaq 2,203.23 +10.07 (+0.46%)
S&P 500 1,313.14 +2.13 (+0.16%)
10-yr Bond 4.777 +0.051 (+1.08%)
30-yr Bond 4.929 +0.056 (+1.15%)
NYSE Volume 1,379,061,000
Nasdaq Volume 1,197,128,000

2:00 pm : Blue chips continue to trade with a tinge of caution as the Dow slips to afternoon lows and the S&P 500 clings to a small gain. On the Dow, the index's priciest component pacing the way lower -- Altria Group (MO 82.69 -1.12), which is also the S&P 500's tenth most influential constituent, is acting as the biggest constraint. The stock hit an all-time high last week. DJ30 -15.12 NASDAQ +0.47 SP500 +5.41 NASDAQ Dec/Adv/Vol 1241/1703/1.16 bln NYSE Dec/Adv/Vol 1370/1798/858 mln

1:30 pm : Major averages are back to trading in split fashion but are still fluctuating in a relatively tight trading range. The Treasury market, though, continues to hit session lows driven by overbought technical indicators in the absence of meaningful economic data; the 10-year note is now down 14 ticks to yield 4.77%. Buying interest has pushed bond yields lower in nine of the past 10 weeks, fueled by policy makers pausing after 17 straight rate hikes and data signaling the Fed may remain on hold with its tightening efforts. DJ30 -5.44 NASDAQ +8.22 SP500 +1.55 NASDAQ Dec/Adv/Vol 1210/1710/1.08 bln NYSE Dec/Adv/Vol 1283/1873/786 mln

1:00 pm : More of the same for stocks as the Nasdaq continues to outpace its blue chip counterparts to the upside. The recent turnaround in tech, led by strength in semiconductors (+0.9%) and software (+0.7%), is still acting as the biggest source of support for the index. However, the tech-heavy Composite is also getting noticeable contributions from retail (e.g. COST +2.0%, SHLD +3.7%), biotech (e.g. AMGN +1.5%, MEDI +1.9%) and transportation (e.g. EXPD +1.0%). DJ30 +1.02 NASDAQ +9.28 SP500 +1.76 NASDAQ Dec/Adv/Vol 1138/1781/992 mln NYSE Dec/Adv/Vol 1255/1904/712 mln



Advances & Declines
NYSE Nasdaq
Advances 1740 (52%) 1671 (53%)
Declines 1428 (42%) 1289 (41%)
Unchanged 173 (5%) 145 (4%)

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

Up Vol* 714 (54%) 616 (53%)
Down Vol* 560 (43%) 509 (44%)
Unch. Vol* 27 (2%) 21 (1%)

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

New Hi's 150 97
New Lo's 17 27

[Ghost Dog]

61. Don't be fooled by this reform: the IMF is still the rich world's viceroy

http://www.guardian.co.uk/commentisfree/story/0,,1864923,00.html

What will be passed off as a democratisation is in fact a way of ensuring the poor global majority continue to have no say

George Monbiot
Tuesday September 5, 2006
The Guardian

The glacier has begun to creak. In the world's most powerful dictatorship we detect the merest hint of a thaw. I am not talking about China or Uzbekistan, Burma or North Korea. This state runs no torture chambers or labour camps. No one is executed, though plenty starve to death as a result of its policies. The unhurried perestroika is taking place in Washington, in the offices of the International Monetary Fund.

Like most concessions made by dictatorial regimes, the reforms seem designed not to catalyse further change, but to prevent it. By slightly increasing the shares (and therefore the voting powers) of China, South Korea, Mexico and Turkey, the regime hopes to buy off the most powerful rebel warlords, while keeping the mob at bay. It has even thrown a few coppers from the balcony, for the great unwashed to scuffle over. But no one - except the leaders of the rich nations and the leader writers of just about every newspaper in the rich world - could regard this as an adequate response to its problems.

The fund is a body with 184 members. It is run by seven of them - the US, Japan, Germany, the UK, France, Canada and Italy. These happen to be the seven countries that (with Russia) promised to save the world at the G8 meeting in 2005. The junta sustains its control by insisting that each dollar buys a vote. The bigger a country's financial quota, the more say it has over the running of the IMF. This means that it is run by the countries that are least affected by its policies.

A major decision requires 85% of the vote, which ensures that the US, with 17%, has a veto over the fund's substantial business. The UK, Germany, France and Japan have 22% between them, and each has a permanent seat on the board. By a weird arrangement permitting rich nations to speak on behalf of the poor, Canada and Italy have effective control over a further 8%. The other European countries are also remarkably powerful: Belgium, for example, has a direct entitlement to 2.1% of the vote and indirect control over 5.1% - more than twice the allocation of India or Brazil. Europe, Japan, Canada and the US wield a total of 63%. The 80 poorest countries, by contrast, have 10% between them.

These quotas no longer even reflect real financial contributions to the running of the IMF: it now obtains much of its capital from loan repayments by its vassal states. But the G7 nations still behave as if it belongs to them. They decide who runs it (the managing director is always a European and his deputy always an American) and how the money is spent. You begin to wonder why the developing countries bother to turn up.

/continues...

[OrangeCountyDemocrat]

65. Intel S&*T Cans 10,500 - More Evidence Of Booming Economy

http://biz.yahoo.com/ap/060905/intel_restructuring.html?.v=10

intel to Cut 10,500 Jobs
Tuesday September 5, 4:29 pm ET
By Jordan Robertson, Associated Press Writer
Intel Corp. to Cut 10,500 Jobs in Restructuring

SAN JOSE, Calif. (AP) -- Chip-maker Intel Corp. said Tuesday a total of 10,500 jobs will be eliminated over the next year through layoffs, attrition and the sale of underperforming business groups as part of a massive restructuring.
The Santa Clara-based company said most of the job cuts this year will come from the management, marketing and information technology ranks.

The world's largest chip maker is fighting to reverse sinking profits and regain market share stolen by smaller rival Advanced Micro Devices Inc.

The cuts come amid intense pressure for Intel to unload money-losing divisions and halt the encroachment of AMD on its lucrative core business making the microprocessors that act as the brains of computers.

Intel has been steadily losing profits and market share. Analysts have criticized Intel for being too bloated and having lost its focus on making the chips that power servers, desktop computers and laptops.

[54anickel]

67. Closing "stuff"

Dow 11,469.28 +5.13 (+0.04%)
Nasdaq 2,205.70 +12.54 (+0.57%)
S&P 500 1,313.25 +2.24 (+0.17%)
10-yr Bond 4.781 +0.055 (+1.16%)
30-yr Bond 4.932 +0.059 (+1.21%)
NYSE Volume 2,046,565,000
Nasdaq Volume 1,794,700,000

4:20 pm : Stocks kicked off the week on a positive note amid more signs that the Fed will remain on hold with its tightening efforts and notable industry leadership from some influential sectors.

Since inflation is the key variable for stocks, and with the Fed recently citing higher energy prices as putting upward pressure on overall inflation, investors embraced a pullback in oil to three-month lows that did anything but jeopardize leadership in the Energy sector. Crude oil prices fell 0.9% to $68.59 a barrel amid signs that Iran may enter further negotiations about its nuclear program. Also contributing to the oil's decline but renewing interest in oil & gas explorers and drillers -- which were among the day's best performers, was news that Chevron (CVX 66.34 +1.51), Devon Energy (DVN 72.14 +7.99) and Statoil (STO 28.17 +0.66) tapped a new deep-water discovery in the Gulf of Mexico that could become a major new domestic source of oil. That announcement helped the Energy sector pace the way higher among the seven sectors posting gains.

St. Louis Fed President Poole saying in an interview on Bloomberg TV that the economy is on an "even keel" and that inflation is "well-controlled" lent further credence to the reduced risk of the Fed "going too far" in raising interest rates that led us at Briefing.com to raise our Market View to Moderately Bullish.

Turning in the next best performance was Technology, as bargain hunters awaiting potential job cuts of up to 10,000 at Intel (INTC 19.99 +0.11) continued to scoop up beaten-down chip makers. Perhaps more notably was the fact that the tech-heavy Nasdaq, which continues to outperform its blue chip counterparts, is back in positive territory for the year as a result. Also helping the Dow close higher for the 10th time in 12 years (on the day after Labor Day) was Caterpillar (CAT 69.68 +2.41), which surged 3.6% after saying it will raise prices on machinery equipment and engines.

Another area of support was Financials. Helping the rate-sensitive sector overlook a rise in borrowing costs was an analyst upgrade on Lehman Brothers (LEH 66.25 +2.70) and Merrill Lynch (MER 74.14 +0.35) offering to buy National City's (NCC 34.99 +0.42) subprime mortgage unit for $1.3 bln, which increased the appeal of other mortgage lenders as potential takeover targets. Treasuries consolidated all day as the absence of economic data to further support the Fed's holding pattern and yields at five-month lows prompted bond traders to lock in two months of gains. DJ30 +5.13 NASDAQ +12.54 SOX +1.7% SP500 +2.24 NASDAQ Dec/Adv/Vol 1191/1838/1.78 bln NYSE Dec/Adv/Vol 1375/1869/1.34 bln

3:30 pm : Stocks still hold their own going into the close as buyers continue to set the tone and position the indices to begin a new week in positive territory. The Nasdaq remains the best performer among the majors and is very close to break even on the year while the Dow is only up fractionally but, with a recent history of doing well the day after Labor Day (i.e. closing up in 9 out of last 11 years), is also on track to finish on an upbeat note. DJ30 +3.84 NASDAQ +11.53 SP500 +2.26 NASDAQ Dec/Adv/Vol 1247/1757/1.52 bln NYSE Dec/Adv/Vol 1409/1818/1.12 bln

3:00 pm : Market is holding onto the bulk of its afternoon gains as buying remains widespread across most areas. Of the seven sectors trading higher, Energy still leads the charge (+1.1%) but gains of 0.5% in the influential Financials and Technology sectors are providing even more notable leadership. Be that as it may, even though volume on the Dow and Nasdaq has been slightly better today, as both are trading at levels just above their 20-day average volume, total participation tapering off into the close reflects less enthusiasm behind the major averages' late-day push to extend Friday's advance.DJ30 +11.89 NASDAQ +13.44 SP500 +3.11 NASDAQ Dec/Adv/Vol 1196/1772/1.28 bln NYSE Dec/Adv/Vol 1391/1828/1.02 bln

2:30 pm : Indices spike higher since the last update and are now at their best levels of the afternoon. However, blue chip gains remain modest at best while those on the Nasdaq are largely the result of strong performances from a handful of influential components. To wit, Apple Computer (AAPL 70.49 +2.11) is surging 3.0%, eBay (EBAY 28.89 +0.74) is enjoying a 2.6% advance, Qualcomm (QCOM 39.12 +0.77) is tacking on 2.0% and Costco (COST) is recovering more than half of the 2.6% it lost last week.DJ30 +8.11 NASDAQ +11.50 SP500 +2.58 NASDAQ Dec/Adv/Vol 1219/1745/1.29 bln NYSE Dec/Adv/Vol 1323/1865/942 mln

[54anickel]

68. Bill Ford Out As Ford CEO

Wow, that's counter to an article I read this morning but didn't bother to post!

http://biz.yahoo.com/ap/060905/ford_ceo.html?.v=13

Bill Ford Replaced As Ford CEO by Boeing Executive Alan Mulally


DEARBORN, Mich. (AP) -- Bill Ford, who struggled for five years to steer Ford Motor Co. toward financial stability, is stepping down as chief executive of the company founded by his great grandfather and is being replaced by Alan Mulally, a top executive from the airplane maker Boeing Co.

Bill Ford will remain as chairman, the company said Tuesday in a surprise announcement.

The change comes more than seven months into a restructuring, which is the second under Ford's watch and has so far failed to revive the nation's No. 2 automaker.

snip>

In announcing Mulally's appointment to Ford employees, Bill Ford said in an e-mail that Ford's turnaround effort "required the additional skills of an executive who has led a major manufacturing enterprise through such challenges before."

more....


I thought something was up when I read about "the memo".....

Ford needs new business model: memo
http://biz.yahoo.com/rb/060905/autos_ford_ceo.html?.v($250%20million)=12

NEW YORK (Reuters) - Ford Motor Co. (NYSE:F - News) needs a new business model in order to turn the automaker around, according to a memo addressed to staff by its Chairman and Chief Executive Bill Ford and seen by Reuters.

snip>

In the memo, dated Friday, September 1 and published by the Detroit News on Saturday, Bill Ford outlined the problems facing the company and his aims to turn it around.

"The business model that sustained us for decades is no longer sufficient to sustain profitability," the memo, shown to Reuters by a representative for the company, said.

"We must change to a new business model that requires greater bottom-line contributions from cars and crossovers, continued leadership in pickups in North America, healthier profits from all other business units, growth in Asia, greater integration of our global operations and an evaluation of strategic alliances."

snip>

Regarding leadership, he wrote that he was now "even more determined to continue to develop leaders inside the company and to attract leaders from outside when we need additional skills to turnaround our business."

Separately, Bill Ford said in a magazine interview he was prepared to let someone else lead the car maker his great-grandfather founded should the right manager be available.

Ford told the September 11 issue of Newsweek in an interview posted on the magazine's Web site: "I'm always looking to bring talent into this company. If I can find somebody -- I thought Carlos (Ghosn) was an exceptionally talented executive who could help the company -- I'll go get him. That is regardless of the position."

Asked if that applied to his own job as well, Ford replied: "Absolutely."

more...