STOCK MARKET WATCH, Tuesday 2 March (#1)

[ozymandius]

Tuesday March 2, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 327
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 81 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 133 DAYS
WHERE ARE SADDAM'S WMD? - DAY 345
DAYS SINCE ENRON COLLAPSE = 829
Number of Enron Execs in handcuffs = 18
Recent Acquisitions: Skilling
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 53

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




AT THE CLOSING BELL ON March 1, 2004

Dow... 10,678.14 +94.22 (+0.89%)
Nasdaq... 2,057.80 +27.98 (+1.38%)
S&P 500... 1,155.96 +11.02 (+0.96%)
10-Yr Bond... 3.99% +0.01 (+0.20%)
Gold future... 399.60 +2.80 (+0.71%)

DOW..........................NASDAQ.......................S&P

||


GOLD, EURO, YEN and Dollars


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

[UpInArms]

1. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DXY0

Last trade 87.95 Change +0.43 (+0.49%)

related articles:

http://www.forbes.com/business/newswire/2004/03/01/rtr1281834.html

FOREX-Dollar rises on ISM data, flinches at Greenspan

NEW YORK (Reuters) - The dollar gained Monday after a report showing expansion in U.S. manufacturing and a rise in the closely watched jobs component of the measure, hinting that labor market conditions are improving in the world's biggest economy.

But the U.S. currency pared some of its gains in late New York trade after remarks by Federal Reserve Chairman Alan Greenspan ahead of a scheduled appearance Tuesday.

The Institute for Supply Management's index of manufacturing activity for February came in at 61.4, down from January's two-decade high of 63.6. The reading was a little lower than expected but still above 50, signaling robust expansion in the sector.

"Anything over 60 is really gangbusters growth," said Grant Wilson, senior foreign exchange trader with Mellon Bank in Pittsburgh. As currency traders "dug a bit deeper, they realized the report was pretty good" also because of the rise in the employment reading, he said.

The employment component of the ISM index rose to 56.3 -- the highest since late 1987 -- from 52.9. That improvement bodes well for the widely watched U.S. non-farm payrolls report, due on Friday.

"That is exactly what we are looking for in this economy. Employment growth seems to be the last piece of the puzzle ... in this environment it would be good for the dollar. The dollar seems to be in a bit of a bullish mode," Wilson said.

The non-farm payrolls data are viewed as potentially pivotal for the dollar as an improvement in the jobs market could hasten a monetary tightening by the Federal Reserve.

Multi-decade low U.S. interest rates, with the fed funds rate at 1 percent, continue to be one of the biggest weights on the dollar.

...more...

http://www.nytimes.com/2004/03/02/business/02greenspan.html

Fed Chief Outlines Risk in Yuan Policy

China should shore up its "quite weak" banking system to prevent instability as it moves toward floating the yuan's value against the dollar, Alan Greenspan, the Federal Reserve chairman, has told a United States senator.

China needs to improve banks' internal controls by giving local managers more training and authority, Greenspan wrote. He was responding to questions posed at a Feb. 12 hearing by Richard Shelby, chairman of the Senate Committee on Banking, Housing and Urban Affairs.

To float its currency, China would also have to lift capital controls, allowing domestic investors to pull money from the local banking system.

...more...

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=4474256

Dollar Crawls Up on Hopes for Strong Data

TOKYO (Reuters) - The dollar edged up against the euro and the yen on Tuesday after good U.S. manufacturing data raised hopes for a strong reading in a key U.S. jobs figure due later in the week.

On Monday, the Institute for Supply Management's index of manufacturing activity for February came in at 61.4, down from January's two-decade high of 63.6.

Although the reading was a little lower than expected, it was still well above 50, signaling robust expansion in the sector.

Traders focused more on the employment component of the ISM index which showed a rise to 56.3 -- the highest since late 1987 -- from 52.9.

"It looks like the market is preparing for good jobs data after seeing the strong ISM figures yesterday," said a spot trader at a major U.S. bank, referring to the widely watched U.S. non-farm payrolls report due on Friday.

At 9:47 p.m. EST, the euro was trading at $1.2430/35 compared with 1.2465/71 in late U.S. trade on Monday.

It was also slightly weaker at 135.55/70 yen versus 135.73/85.

The dollar was at 109.10/13 up 0.2 percent on the day.

Some dollar bulls hope that a strong reading in the upcoming jobs data will lift the U.S. currency above recent resistance of 110 yen.

"If it (the data) is good, I think it will be positive for the dollar and may push through 110 yen," said Toshihiro Azuma, forex manager at Sumitomo Trust and Banking.

<snip>

"Despite the shift in positions, the dollar's rise has been capped so you have to wonder who is selling (dollars). Until we figure this out, it'll be difficult to take new positions."

...more...

http://www.nytimes.com/2004/03/02/business/worldbusiness/02YUAN.html?ex=1078808400&?en=bc58e2456b5aa0c4&?ei=5062&?partner=GOOGLE

Like Japan in the 1980's, China Poses Big Economic Challenge

GUANGZHOU, China — When Japan, at the zenith of its economic power, built a huge airport in Osaka in the late 1980's, the project set off a seven-year trade battle with the United States over the nearly complete exclusion of non-Japanese companies.

China, Japan's heir as Asia's rising star, is now completing its own immense airport here in Guangzhou, the sprawling commercial center of affluent southeastern China. But the Chinese are going about it differently.

American companies designed the terminal, its air-conditioning system and the flight information system. A German company engineered the vaulting roof, a Danish company produced the boarding gates and a Dutch company, the check-in counters. Chinese women in broad- brimmed straw hats wield shovels and brooms across from a modern air-traffic-control tower designed by a company from Singapore.

The welcome that China is offering to multinational companies and foreign investment has left many Western business executives, so critical of a closed Japan more than a decade ago, enthusiastically embracing China, its cheap work force and its huge markets.

But that same openness — combined with China's vast population of 1.3 billion and military muscle — makes it an even greater long-term economic challenge to the United States than Japan seemed to be in the 1980's, according to a growing number of executives, economists and officials.

While China's economy is still one-third the size of Japan's, the potential size of its market has made it very hard for companies to say no when Beijing officials demand that they build factories, transfer the latest technology or adopt Chinese technical standards.

Japan has effectively run out of low-wage workers for its industries, and quickly brought much of its economy up to and in some cases beyond Western technological standards. China still has vast reserves of cheap labor in inland areas and many backward industries that can grow swiftly as they copy Western and Japanese methods.

"China could do what Japan did, as a very fast follower, but China could do it bigger and better and for a longer period of time," said Steven Weber, an Asia scholar at the University of California at Berkeley. "It's not necessarily as vulnerable as Japan was."

But while Japan's danger to other economies over the last decade has taken the numbing forms of economic stagnation and political lassitude, China poses the risk of fast, sharp shocks.

...more...

Great 'Toon, Ozy! Wonder whether OBL watches FAUX or that new station we beam out of Virginia?

Have a Great Day at the slots, Marketeers!

[54anickel]

2. Good Morning UIA, Ozy and All. Have some technical numbers on the US$

that may be fun to watch for the week.

The March Dollar was higher overnight and remains poised to test January's high crossing at 88.32. Closes above January's high crossing at 88.32 would confirm an upside breakout of the upper boundary of this year's trading range. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes below the 20- day moving average crossing at 86.61 would temper the friendly outlook in the market. Multiple closes below February's low crossing at 84.77 would open the door for a possible test of monthly support crossing at 83.87 later this winter. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

[Frodo]

4. Translation?

"Oh look! It's going up! If it keeps this up much longer than it will have gone up more. But if it doesn't then it won't."


Why not just "The dollar index appears to have formed a very pretty 'double bottom' which could be a positive sign, but we've been here before"???

[54anickel]

15. Bit more of Greenspan on China peg

http://www.washingtonpost.com/wp-dyn/articles/A21243-2004Mar1.html

Greenspan Backs Currency Peg

snip>
China's banking system is too fragile for the country to immediately abandon its policy of pegging the value of its currency, the yuan, to the U.S. dollar, Greenspan said in a letter to Senate Banking Committee Chairman Richard C. Shelby (R-Ala.), responding to several of the senator's questions. Shelby's office released the documents, which were reported late yesterday by the Wall Street Journal.

"The condition of the Chinese banking system is currently quite weak," Greenspan wrote, noting that analysts estimate up to half of all loans made by the government-controlled institutions may be non-performing, and that even the government reports that the system's liabilities may exceed its assets.

Such a banking system can operate if people agree to keep their money in the banks, the Fed chairman wrote. But if Beijing removed the rules that currently limit the Chinese from investing abroad and purchasing foreign currency, as it would have to do if its currency were to float, Greenspan said, many in China fear that could trigger a destabilizing run on the banks, in which people pull their deposits out en masse.

more...

[ozymandius]

3. WrapUp by Jim Puplava - Collision Course

Collision Course
The Perfect Financial Storm

In the world of finance (besides guessing where the stock market will end up this year), a topic that dominates front page news is the issue of inflation or deflation. The financial world is divided over this issue with the deflationist dominating the debate.

The Deflation Argument
The deflationists cite the historical levels of debt overhanging the economy and the enormous asset bubbles in stocks, bonds, mortgages and real estate. In a levered economy and financial market any increase in interest rates would cause the whole debt bubble to implode. This would lead to a deflationary spiral as debts are liquidated contracting the supply of money.

Seven Headwinds of Inflation

As the financial markets begin to crater with an accompanying rise in bankruptcies and defaults, the government and the Federal Reserve will move with a use of force with every tool at its disposal. The result is that monetary and fiscal stimulus will accelerate. Listed below are seven inflationary headwinds that will confront a deflationary headwind in the financial markets and the economy.

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

read this after you have eaten

[UpInArms]

5. I do believe that

you have never posted an article that has disturbed me quite as much as that one, Ozy.

I didn't follow your "eat first" advise and now I feel quite sick.

here is a part of The Daily Reckoning from yesterday -

*** Introducing: INDEFLATION... .a slithering, obnoxious
animal...


*** Clash of civilizations... watch out, the Mexicans are
coming! The Reconquista of California... and more...


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


We had just turned up a big rock on Friday.


Under it was a slimy, repulsive animal with an empty,
deflated head and a puffy, deflated body. It is neither
fish nor fowl... neither the deflation of America in the
'30s nor Japan in the '90s... but not your typical
inflation, either. Instead, it has the worst
characteristics of each, mixed together in some terrible
mutant shape so horrible to look at, we just couldn't bear
it - at least, not while we were still on vacation.


We dropped the stone immediately.


But now it is a new week, a new month, and our holiday is
over. So we return to work with a hoe in our hand - ready
to bruise the head of the serpent should it get out of
line.


And what an odd beast it is!


Last week, GDP figures for the last quarter were revised to
over 4%. Alan Greenspan appeared in public and said the
U.S. was on the road to sustained growth. Stocks went
nowhere, but they didn't have to; they were already at
boom-time levels.


If it were true that the U.S. economy really was headed
towards another impressive growth spurt, you might expect a
spurt in employment, interest rates and consumer prices,
too. Or to put it another way, investors should prepare for
inflation; that is what you usually get when you juice up
the economy with easy money.


But this weird thing in front of us looks very different
from a typical inflation cycle.


Some prices are up sharply. The cost of shipping, for
example, has risen 550% since 2001. It takes a long time to
build a ship, and with the new Asian trade, it appears that
there aren't enough of them. But the prices of the goods
shipped are not necessarily going up. Commodities on their
way to China have gone up... but the finished goods coming
out of Chinese factories have actually gone down.


House prices, too, are up sharply. But rents are going
down... for an obvious reason: rising house prices have
encouraged production of homes and apartments.


And while we are supposedly a year and a half into a
recovery, employment still hasn't bounced back... and bonds
still act as though the economy were in a slump.


"January's mass layoffs set record," reports the Kansas
City Star.


Consumers may have reached the limit of their ability to
add new debt and new expenses. We know we have said this
before... but we are bound to be right sooner or later. And
when consumers can no longer spend what they don't
have... prices on what they don't need are likely to fall,
not rise. Plus, about a quarter of factory capacity in
America is still unused. So, there is a long way to go
before supply limitations force price increases.


Prices that are rising seem to be doing so either because
of unique circumstances - such as shipping - or because the
dollar is falling. The dollar may fall much further... which
will put up energy costs. But this is not the inflation of
an 'overheating' business cycle. This is the inflation of a
falling dollar... which could get worse as the U.S. economy
goes into a prolonged Japanese-style slump.


What can we call it? Rising prices and falling ones
too... inflating prices in the midst of a recession... ? What
name can we give this hideous new beast? Aha... let's call
it INDEFLATION, a period in which American consumers watch
their costs of living go up... even as their economy
collapses.


More on indeflation tomorrow...

[54anickel]

11. Terrible prognosis.

Makes me wish I was born 25-30 years earlier and on my way out with lots of "good memories" behind me rather than facing a rather bleak future. But there is always hope for things to be much better after a drastic change.
Let's hope the change goes by swiftly so that optimism may return in our lifetimes.

[ozymandius]

6. Good morning Marketeers!

:donut: :donut: :donut: :donut: :donut: :donut:

I will not be around much today. We are casting votes in the Dem primary and filing our taxes - so the plate is pretty full.

Please allow me to re-iterate my sentiment that is usually bandied in jest.

In reference to the data posted by 54anickel and Frodo, I think that both are correct summations of market tendencies. My own assessment of these numbers, reflective of one day's performance, is more cynical. I typically see a market spike, a-propos of nothing really, as a prelude for profit taking the following day. It is habitual.

When analysts lament that the market has essentially stalled or "reached resistance" it is because of this casino atmosphere. Money is continually shifted from one fund to another, to one market to another. Sucker rallies emerge and recede every week.

[KoKo]

10. Agree Ozy, it's been a "traders market" for a long while now. I've been

watching the stock market carefully for years and even for someone who is more an observer it's easy to see patterns if one has a few stocks they watch consistently. If I was a "trader" I could have made piles of money with my knowledge from watching the swings in these few key stocks as the go up for a week then "profit taking comes in" and they go down for two weeks, then they go up to where they were before the "profit taking occurred" and then down to just about where they were at the last trade out.

That this little group of stocks never tick too far above or below a certain price is proof enough to me that this is not based on any positive or negative news about the earnings or lack of in these stocks, but that it's the traders moving in and out and the mutual funds (basically traders, too, it seems) following the pattern. Strange times, indeed.

[54anickel]

12. Agree, but having their numbers in mind makes being a spectator much

more entertaining. Helps to understand the object of the game. Now if we could just figure out the currency dugout team members and "who's on first".
:evilgrin:

[ozymandius]

7. 9:41 and the market's open

Dow 10,650.14 -28.00 (-0.26%)
Nasdaq 2,059.98 +2.18 (+0.11%)
S&P 500 1,155.31 -0.66 (-0.06%)
10-Yr Bond 4.009% +0.017

[ozymandius]

8. 10:06 and bounceless

Dow 10,646.88 -31.26 (-0.29%)
Nasdaq 2,060.68 +2.88 (+0.14%)
S&P 500 1,155.60 -0.37 (-0.03%)
10-Yr Bond 4.006% +0.014

I must run folks as lots of work away from here must be done.

Have a wonderful day! :hi:

Ozy

[JNelson6563]

9. Mornin' all!

I'm just in from teaching the wee ones how to be good capitalists and I see the markets are down. Can't imagine why. There were on 77,000+ layoffs last month, I mean come on! Not to mention we've secured the launch spot for a take-over of oil-rich Venezuala so Wall Street should be dancing on a couple of soon to be dug graves. Curse those democratically elected leaders who refuse to privatize their nation's assets! If they won't sell by golly we shall commandeer them.

Ugh!


Was going to post update but my computer's giving me some trouble. The DOW's down about 20 pts. and there is a slight sell-off in Treasuries.

More later. Hope it's all good with you Marketeers! :hi:

Julie

[54anickel]

13. U.S. still wants China currency change

http://www.forbes.com/markets/newswire/2004/03/02/rtr1282729.html

WASHINGTON, March 2 (Reuters) - The White House still wants China to move to allow its currency's value to be determined by financial markets despite Fed Chairman Alan Greenspan's reservations about it, a spokesman said on Tuesday.

"Our policy remains the same. Our policy is very well known," White House spokesman Scott McClellan said.

He was reacting to Greenspan's warning to the U.S. Congress on Monday that the global economy could suffer if China were to move now to allow its currency's value to be determined by financial markets.

a bit more...

[54anickel]

14. Greenspan Skips Short-Term Deficit Risk to Rates

The theme to this article sounds much like part of todays wrapup.

http://quote.bloomberg.com/apps/news?pid=10000039&cid=berry&sid=aUseQ9AfTAVM

March 2 (Bloomberg) -- Federal Reserve Chairman Alan Greenspan said last week that big federal budget deficits eventually would lead to increases in long-term interest rates large enough to undermine U.S. economic growth.

However, Greenspan skipped over the possibility that ``eventually'' could arrive as soon as next year, leaving Fed policy makers with a potentially serious problem on their hands.

Perhaps the chairman didn't want to spook the markets. Perhaps he didn't want to go nose-to-nose with President George W. Bush over tax cuts, though Greenspan himself wants taxes to be as low as possible.

``The particular point where I think we have to be very careful is that point in which the expectation of looming deficits in the next decade begin to impact on long-term interest rates currently,'' Greenspan told the House Budget Committee.

``I don't know where that is. I don't believe it's in the immediate future. It's out there in this decade by all of the analysis that we can make,'' he said.

more...

[54anickel]

16. CB to Use Forex Reserves to Keep the Ruble Steady

http://www.themoscowtimes.com/stories/2004/03/02/050.html

LONDON -- The government is prepared to use its foreign exchange reserves to cushion any upward pressure on the ruble, as it closely watches the dollar's fall against the euro, the Financial Times reported on Monday.

Oleg Vyugin, the Central Bank's first deputy chairman, told the paper in an interview that the bank was prepared to act to prevent the currency market from "overheating." The country has seen strong interest from portfolio investors, lured by its rising markets and economic potential.

"If there is a big flood of portfolio investment into the Russian market, the Central Bank is ready to use its reserves to sterilize this," Vyugin was quoted as saying.

Gold and foreign exchange reserves stood at $86.7 billion as of Feb. 20, up $9.8 billion since the start of 2004, thanks largely to high oil and commodities prices, heavy corporate borrowing abroad and more Russians shifting their savings into rubles away from a weak dollar.

more...

[54anickel]

17. Another article that touches on deflation, and geopolitical tensions

http://www.financeasia.com/articles/7D0AF1BB-7F31-4816-B9377B41FAB606C6.cfm

snip>
The increasingly unilateralist foreign policy of the Bush administration was the primary factor driving global geopolitical risk higher. Unilateralism has defined U.S. positions on issues ranging from trade to the global environment.

However, the most profound and damaging expression of unilateralism has been through the pursuit of the war on terrorism. The invasion and occupation of Iraq explicitly contravened the United Nations and abrogated international law.

This severely damaged U.S. foreign relations with many countries, most notably France, Germany and Russia. In addition, the war on terrorism has also inflamed tensions between Israelis and Palestinians, and increased instability on the Korean peninsula.

Lastly, the war on terrorism has not subdued global terrorism. Terrorist strikes have become more frequent. The U.S. presidential election will be fundamental to pushing global geopolitical instability higher in 2004. Continued hardening of unilateralism, driven by electoral politics, will further strain US foreign relations and intensify instability in the Middle East and the Korean peninsula.


snip>
Last year the strong dollar policy advocated by the US Treasury since the mid-1990s was subtlely abandoned. It is generally assumed that dollar policy was changed in order to improve the competitiveness of US exports, spurring growth of manufacturing jobs.

It is more probable that dollar policy was changed, with heavy influence from the Federal Reserve, in order to counter building deflationary pressure in the US economy. According to the advance estimate of gross domestic product released by the US Bureau of Economic Analysis on January 30, deflation of durable goods prices accelerated to -3.7 percent in 2003 from -2.9 percent in 2002.

Durable goods purchases accounted for 20 percent of total US gross domestic product in 2003. In addition, deflation remained stubborn in non-residential fixed investment prices. This investment accounted for a further nine percent of US gross domestic product last year.

To counter deflationary pressure, the US Treasury, at the behest of the Federal Reserve, will continue earnestly exporting US deflation, via dollar depreciation, to the rest of the world in 2004.

In addition to abandonment of the strong dollar policy, the economic threat posed by the staggering twin US deficits are likely to push the value of the dollar lower in 2004. Last year, the US current account deficit was estimated to have reached a record 5.1 percent of GDP while the US general government deficit, which includes both the federal and state governments, was likely to have approached six percent of GDP.

This year, weaker US economic growth will ease the current account deficit toward four percent of GDP. However, very loose fiscal policy will push the general government deficit toward seven percent of GDP. The era of massive twin deficits in the US has returned.

The last such episode, which occurred in the mid-1980s, heralded a 30 percent decline in the real effective exchange rate of the dollar. By comparison, the real effective exchange rate of the dollar has depreciated by less than 10 percent over the past 18 months.

Nearly $1 trillion of foreign capital is funding the US public sector and current account deficits. About $800 billion of this foreign money is invested in US government, agency and corporate bonds. The size of these deficits and the nature of their funding make the dollar very vulnerable to depreciation, and long-term interest rates exposed to upward pressure.

Higher long-term interest rates will strongly undermine the growth of credit that has been crucial to US personal consumption expenditure and overall economic growth in the past two years. Assuming that dollar depreciation remains controlled, the dollar/euro exchange rate should exceed 1.40 by the end of 2004.

The yen/dollar exchange rate should reach about 98 by the end of 2004. The weight of foreign investment in the US financing the large twin deficits indicates that the risk of much greater dollar weakness is substantial. Expected dollar depreciation, the large current account and fiscal deficits and increasing geopolitical instability, driven by US electoral politics, make the dollar a very unlikely safe haven for global investors. Foreign capital flight from the US could easily trigger a large dollar devaluation.

[54anickel]

18. Ya-Hoo! Check out this straight upshot on the greenback just now!

?s=NYBOT_DXY0&t=f&w=5&a=2&v=s


Last trade 88.68 Change +1.16 (+1.33%)

Settle 87.52 Settle Time 23:35

Open 87.55 Previous Close 87.52

High 88.71 Low 87.43

[UpInArms]

19. I was just going to post that!

YeeeYYYYEEEEEE!!!!!

Where did all that money come from?

Was it the yen going to 110?

Did China whack the yuan?

going hunting....

[UpInArms]

20. factors for the day

http://www.fxstreet.com/nou/content/102055/content.asp?menu=market&dia=232004

Yen:

The Bank of Japan will remain determined to prevent fresh downward pressure on the dollar in the short term and will discourage dollar selling through intervention if necessary. The dollar has the potential for a move to 109.8 initially. Resistance here will be tough, but there is a 30-40% chance of extended gains to 112.0. Speculative short dollar positions offer little immediate value given the central bank stance.

The dollar has not been subjected to a test of the 108.0 level and the US currency has retained a firm tone over the past 12 hours. In early Europe on Tuesday, the dollar strengthened to 109.35.

There has been further evidence of Bank of Japan support for the dollar. This continues to suggest that the central bank stance has shifted and that it is trying to force short dollar positions out of the market rather than just preventing further yen gains. The authorities want to lessen the risk that the dollar will face renewed downward pressure in the near term and there is the risk that dollar short positions will be reduced further which could push the US currency towards the 112.0 level.

The medium-term outlook still suggests that the yen will strengthen and a move to 112.0 would offer some value in long yen positions.

Disclaimer: Investica's market analysis is not investment advice and must not be taken as recommending particular market positions. Investica can take no responsibility for any actions taken by investors.

[54anickel]

22. Forcing those buck short positions out - nice strategic move on BoJ's

part. They'be broken thru 110, 112 would indeed be impressive.

[UpInArms]

31. the following article says that this is all "technically driven"

http://www.forbes.com/markets/newswire/2004/03/02/rtr1282909.html

Dollar vaults higher on jobs outlook

CHICAGO, March 2 (Reuters) - The dollar hit multi-month highs against the euro and the yen on Tuesday, aided by a manufacturing report on Monday that stoked speculation a forthcoming U.S. jobs report would show solid improvement.

Analysts and traders said the ball started rolling in the dollar's favor after Monday's Institute for Supply Management report for February showed a bigger-than-expected rise in the employment component.

The dollar buying momentum accelerated after a pile of euro/dollar sell orders knocked the European currency to a 2-1/2-month low. The greenback simultaneously shot to four-month high against the yen.

"It's technically driven. The euro went through $1.2330 and we were off to the races," said Marvin Barth, senior currency economist at Citibank. "Dollar/yen also went above 110 at about the same time, but there is no fundamental news behind it."

...more...

[54anickel]

35. Pht-t-t-t Now that's funny. "No fundamental news behind it." Guy must

have never heard of the BoJ.

[UpInArms]

36. the space under his rock is quite large

:evilgrin:

[ze_dscherman]

23. Our FO will be happy, my daughter not

Since our companies U.S. prices are based on the Dollar, the rise of the Euro has hurt our companies profits quite bad (50% exports to the U.S.). But my daughter has lost quite some money, she was just about to change Euro to Dollar for a long school exchange ...

[54anickel]

24. Well, depending on how much time she has to wait it out, she may

get another opportunity soon enough. US$ should still have a long way to drop.

[54anickel]

21. 11:53 update

Dow 10,649.03 -29.11 (-0.27%)
Nasdaq 2,061.02 +3.22 (+0.16%)
S&P 500 1,155.54 -0.43 (-0.04%)
30-yr Bond 4.894% +0.036


http://biz.yahoo.com/cbsm-top/040302/2f6fb470391b56ae8080e10eff511984_1.html

NEW YORK (CBS.MW) - U.S. stocks were mostly lower Tuesday as a lack of economic data and the threat of higher interest rates prompted investors to book profits following the prior session's strong gains.

snip>
Investors were anxiously waiting for Friday's February employment report, which has the potential of setting the market's tone for the next month. A drop in layoffs at U.S. corporations, as reported by Challenger Gray and Christmas, led investors to believe that the report would be stronger than expected, and sparked a sell-off in the bond market and a surge in the U.S. dollar.

"Concerns over rising interest rates have been consistently overhanging the markets," said David Hegarty, head of equity trading at Commerzbank Securities. He acknowledged, however, that investors will remain "hesitant to act" ahead of news out later in the week.

[54anickel]

25. 12:36 update and blather (for cryin' out loud)

Dow 10,619.11 -59.03 (-0.55%)
Nasdaq 2,051.38 -6.42 (-0.31%)
S&P 500 1,152.23 -3.74 (-0.32%)
30-yr Bond 4.912% +0.054


12:30PM: The indices have dropped across the board, and there is talk that this is due to concerns about a strong employment report, and the possibility of subsequent higher interest rates...indeed, the 10-year note has fallen 18/32 today to yield 4.04%, but that is still pretty low...and the chance of the Fed altering its position on the back of a single, modestly strong payroll gain, is minimal...so, while the prospect of a strong employment report was bullish yesterday, today it is being called bearish...we'll settle for simply calling this more profit-taking than anything else...
some days there are more sellers than buyers...and today's losses are still small compared to the gains yesterday...NYSE Adv/Dec 1407/1745, Nasdaq Adv/Dec 1285/1733

[UpInArms]

26. Funny how the market "hates" for employment to go up,

isn't it?

Dow 10,601.55 -76.59 (-0.72%)
Nasdaq 2,047.30 -10.50 (-0.51%)
S&P 500 1,150.45 -5.52 (-0.48%)
10-Yr Bond 4.050% +0.058

[54anickel]

29. Guess you could read that as further evidence that the markets are

not the economy.

[UpInArms]

34. Numbers at 1:45 EST

Dow 10,579.85 -98.29 (-0.92%)
Nasdaq 2,043.97 -13.83 (-0.67%)
S&P 500 1,148.05 -7.92 (-0.69%)
10-Yr Bond 4.046% +0.054

[UpInArms]

27. Meanspin speaks

http://www.forbes.com/markets/newswire/2004/03/02/rtr1283034.html

Greenspan sees U.S. current account improving

WASHINGTON, March 2 (Reuters) - Federal Reserve Chairman Alan Greenspan said on Tuesday the dollar's falling value should eventually help curb huge U.S. trade deficits without leading to major disruption.

"The currency depreciation that we have experienced of late should eventually help to contain our current account deficit as foreign producers export less to the United States," the Fed chief told the Economic Club of New York.

In a wide-ranging address, Greenspan noted he did not believe heavy currency intervention by Asian countries, including Japan and China, was driving the value of the euro up against the dollar, notwithstanding European nations's complaints that it was happening and threatening their economic recovery.

and if you have a subscription you can read the whole text (I do not have one)

http://www.fednews.com/transcript.htm?id=20040302t0214

TEXT OF REMARKS TO BE DELIVERED BY FEDERAL RESERVE BOARD OF GOVERNORS CHAIRMAN ALAN GREENSPAN TO THE ECONOMIC CLUB OF NEW YORK
TOPIC: CURRENT ACCOUNT

ECONOMIC CLUB OF NEW YORK, NEW YORK, NEW YORK TUESDAY, MARCH 2, 2004

It has been a number of years since the foreign exchange rate of the dollar has played so prominent a role in evaluations of economic activity. I have no intention today of discussing the foreign exchange policy of the United States. That is the province of the Secretary of the Treasury. Nor do I intend to project exchange rates. My experience is that exchange markets have become so efficient that virtually all relevant information is embedded almost instantaneously in exchange rates to the point that anticipating movements in major currencies is rarely possible. The exceptions to this conclusion are those few cases of successful speculation in which governments have tried and failed to support a particular exchange rate. ..

( Registered users, please login to view the full transcript:)

[54anickel]

32. Uhh, ya. BoJ and others intervention plays no role in the rise in

value of the Euro. So hey, ECB why don't you just lower your interest rates. :eyes:

[54anickel]

28. ECONOMIC FORUM /Intl action needed to manage yuan revaluation

http://www.yomiuri.co.jp/newse/20040302wo11.htm

snip>
Until recently, the Chinese government wanted to delay any revaluation for up to two or three years due to fears that a rise in the value of the yuan, or renminbi, could cause drastic changes in the Chinese economy.

But if the yuan's fixed exchange rate is maintained at its current level, a number of serious economic problems may occur in China, such as an economic bubble caused by sharply rising property prices.

snip>
Everything, however, has both favorable and unfavorable elements.

To keep the yuan's rate low under the peg, the People's Bank of China, China's central bank, has made large dollar-buying interventions, leading to colossal accumulation of foreign exchange reserves. The ever-swelling reserves have caused excessive liquidity in China's domestic economy, threatening to trigger a property bubble and serious inflation that could plague the whole economy.

When a country keeps the value of its currency artificially low, imbalances in its domestic economy are certain to increase.

China, consequently, could see its weak yuan policy eventually result in a sudden sharp rise in the exchange rate and the bursting of the economic bubble, which could be followed by a major economic downturn.

snip>
Already, the influx of cash from abroad into China has been rising at a surprisingly rapid pace, causing the prices of one-year yuan futures to reach a value 5 percent higher than the current exchange rate.

Chinese monetary authorities could find themselves forced to do away with the current fixed exchange rate system should speculation over the yuan's value gain further momentum. Beijing should not think lightly of such market forces.

If the yuan peg is changed to a basket formula, what impact will it have on the Japanese economy?

According to BNP Paribas, after revaluing the yuan, China would ensure that its foreign exchange reserves are balanced with its trade with respective countries. The result would be a sale of about 86.8 billion dollars of its foreign reserves. This would mean the corresponding amount of yen and euros would be purchased by China, causing the dollar to dive and both the yen and euro to appreciate sharply, BNP Paribas said.

snip>
China and all other countries concerned over the yuan's value should engage in in-depth discussions over the issue, working together to minimize the unfavorable effects of a yuan revaluation by making thorough advance preparations.

[UpInArms]

30. Youch!! Watch out for falling dollars!

According to BNP Paribas, after revaluing the yuan, China would ensure that its foreign exchange reserves are balanced with its trade with respective countries. The result would be a sale of about 86.8 billion dollars of its foreign reserves. This would mean the corresponding amount of yen and euros would be purchased by China, causing the dollar to dive and both the yen and euro to appreciate sharply, BNP Paribas said.

and this is what our feckless Secretary of the Treasury is recommending????

[54anickel]

33. Well, that depends if you believe Snow REALLY wants the yuan

revalued or if he just "politicking" in a lame attempt to pacify the manufacturers complaining about China.

Either way, I think Greenspin's latest comments reflecting his concern for China's well-being if we push them into revaluing too quickly is actually concern for his own ass, and ours of course.

[nolabels]

40. European Union slaps retaliatory tariffs on US

Should of posted this here, instead of posting please excuse me and thanks for the space and the other peoples time hope this helps
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x394796


http://www.latimes.com/business/la-fi-trade2mar02,1,7755092.story?coll...
(Registration for access to link)
EU Imposes 1st Tariff Penalties on U.S. Goods
At issue is a law that allows American firms to exclude a portion of their foreign sales from corporate income tax.


By Warren Vieth, Times Staff Writer

WASHINGTON — The European Union slapped retaliatory tariffs Monday on a wide range of U.S. agricultural and manufactured goods, increasing pressure on Congress to make significant changes in the way U.S. corporations are taxed.

The EU sanctions start small — $17 million this month — but will gradually increase to a level of about $670 million a year unless Congress repeals an export tax break declared illegal by the World Trade Organization.

The sanctions are the largest authorized by the WTO since its creation in 1995 and the first imposed by the EU against the U.S. They apply to some 1,600 products, from California produce, toys and electrical machinery to Carolina textiles.

"This is big," said University of Maryland trade economist Peter Morici. "You cannot get rid of this tax break without rejiggering the entire corporate tax. Once you get involved in that, it becomes a major piece of legislation."
(snip)

[54anickel]

45. Thanks for posting the link Nolabels. This should get interesting

in the near future.
Doesn't this somehow effect the corps that set up office in the Bermudas? I thought the FSC was what those corps were utilizing.

[54anickel]

37. 2:25 numbers & blather

Dow 10,589.85 -88.29 (-0.83%)
Nasdaq 2,045.54 -12.26 (-0.60%)
S&P 500 1,149.45 -6.52 (-0.56%)
30-yr Bond 4.909% +0.051


1:55PM: Major indices drop to their worst levels with few sectors in the green... At this point, the Dow has given back all of yesterday's gains as sellers continue to book profits in some of the average's most defensive issues... The S&P 500 and Nasdaq are looking a little better - still up for the week - but have similarly fallen in the afternoon retreat... Strikingly, the bond market has also been hit in the past two hours...
Fed Chairman Greenspan's remarks to the New York Economic Club have not been very supportive to prices, reiterating that rates will need to rise 'at some point' and sending treasuries to their lows...NYSE Adv/Dec 1494/1731, Nasdaq Adv/Dec 1273/1819

[54anickel]

38. I'm surprised that the EU sanctions against the US haven't made it

into the "reasoning" of the blather yet.

http://www.rferl.org/featuresarticle/2004/3/43A29981-9504-4829-A77E-D85CC1BAECDB.html

The EU yesterday introduced what it says are its first-ever trade sanctions against the United States. The move raises the stakes in a simmering trade war with Washington.

The EU sanctions are in response to a ruling by the World Trade Organization (WTO) that a U.S. tax-break regime for U.S. exporters is illegal. The break amounts to some $4 billion a year. Now, the EU is imposing retaliatory tariffs on a long list of U.S. imports. The tariffs could amount to $1 billion by the end of next year.

Arancha Gonzalez is a spokeswoman for Pascal Lamy, the EU's trade commissioner. She said yesterday the EU had given the United States ample time to reconsider its tax breaks, and that countermeasures were now inevitable. "We have been, as you know, waiting for more than two years for compliance from the , and they have not yet brought their legislation in line with WTO rules," she said. "We have therefore been left with no other choice than imposing these countermeasures."

snip>
The EU has now drawn up a list of U.S. goods on which it will start levying customs tariffs at gradually increasing rates. Sanchez explained: "We have agreed to impose customs duties on a list of U.S. goods exported from the United States to the European Union starting at 5 percent in March, which will be increased by a gradual, additional 1 every month. So it's 5 percent this month, 6 percent next month, and 7 percent in the month of . The purpose is again the same -- to put pressure on the system so that at the end of the day, the system delivers on what we really want, which is change in the legislation. It's well below the $4 billion that the WTO awarded us as a maximum . If these duties are imposed during the entirety of 2004 -- and we hope that will not be the case -- a total amount in the order of 300 million extra U.S. dollars will be collected in 2004, and if it continues into 2005, it will be in the order of $600 million."

Yesterday, EU Trade Commissioner Pascal Lamy rejected suggestions that the move marks a dramatic escalation in the generally tense EU-U.S. trade relationship. "We are not in a trade war,” he said. “We just want the U.S. to comply with the WTO ruling that they have to repeal their system for subsidizing their exports and we have been authorized by the WTO to impose sanctions, which are just there to compliance."

The EU strategy may have worked. U.S. President George W. Bush yesterday urged Congress to quickly scrap the export-tax break by passing legislation that reforms the Tax Code and "removes the underlying reason for tariffs that have been imposed today on American exports."

more...

[UpInArms]

39. that won't affect companies' bottom lines as the US

taxpayer gets to foot the bill for sanctions.

To all taxpayers: Bend over! :spank:

[54anickel]

41. Silly me, but of course. The corps may loose their little tax-break

regime, but Shrub will just reappropriate the funds from elsewhere in out pool of tax dollars. We get to pay the sanctions as a bonus :silly:

[UpInArms]

42. by jove, I think you've got it!

You see - Idiotboy gets to go around and place sanctions on industries where he needs to get votes from those communities - during the photo-op sessions -

Then the global trading community that the pubs keep promoting as good for bidness determine that we do "unfair trade" and go the that wondrous organization (The WTO) where the corporate heads determine how we can do trade - knowing that they can collect hefty fines at the citizens' expense so the corps can't lose.

We can keep exporting our jobs - so that the corps can have a better stock price and need to have higher returns for lower costs.

And those that are left working get to pay the sanctions that those trading partners impose on our country!

[54anickel]

44. So best not use at as an excuse for any drop in the markets, lest they

run the risk of drawing attention to the latest scheme.

Guess they wouldn't want John Q investor to know that part of their "earnings" came from this extra little "tax break".

[nolabels]

43. They are FREAKING VAMPIRES, them corporate whores

I am waiting for them to just give some reasons for them just to plug directly into every bodies veins, giving the reason they need a more direct way to suck everybody dry :argh:

[UpInArms]

46. looking for the 3:00 to 4:00 EST push back up?

Dow 10,610.74 -67.40 (-0.63%)
Nasdaq 2,047.33 -10.47 (-0.51%)
S&P 500 1,151.99 -3.98 (-0.34%)
10-Yr Bond 4.049% +0.057

[UpInArms]

47. Final Numbers and Blather

Dow 10,591.48 -86.66 (-0.81%)
Nasdaq 2,039.66 -18.14 (-0.88%)
S&P 500 1,149.11 -6.86 (-0.59%)
10-Yr Bond 4.046% +0.054

3:30PM: The market has lifted broadly off its lows, suggesting a widespread bounce, rather than a spike on news...some press reports have it as really negative day, but it really is more that the current environment does not sustain gains such as yesterday as easily as was the case back in December...NYSE Adv/Dec 1451/1802, Nasdaq Adv/Dec 1300/1836

3:00PM: There are not many earnings reports on the near-term calendar...most are retailers...Foot Locker (FL 26.70 ) is due to report after the close today, as is Pacific Sunwear (PSUN 24.60 - 0.11)...tomorrow morning brings CostCo (COST 39.50 -0.44), Toys R Us (TOY 15.41 -0.28) and Saks (SKS 17.60 unch)...then on Thursday morning, February same-store sales data from all the retailers will come out...so, this could be one of the key sectors to watch the next couple of days...NYSE Adv/Dec 1449/1801, Nasdaq Adv/Dec 1243/1884

(edited for html)