STOCK MARKET WATCH, Thursday 15 April

[ozymandius]

Thursday April 15, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 284
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 125 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 178 DAYS
WHERE ARE SADDAM'S WMD? - DAY 392
DAYS SINCE ENRON COLLAPSE = 874
Number of Enron Execs in handcuffs = 18
Recent Acquisitions: Skilling
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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




AT THE CLOSING BELL ON April 14, 2004

Dow... 10,377.95 -3.33 (-0.03%)
Nasdaq... 2,024.85 -5.23 (-0.26%)
S&P 500... 1,128.17 -1.27 (-0.11%)
10-Yr Bond... 4.38% +0.04 (+0.97%)
Gold future... 400.50 -7.20 (-1.77%)

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

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

[ozymandius]

1. WrapUp by Mike Hartman

Take a Few Steps Back

The big news that got everybody excited today was the release of the Consumer Price Index for March indicating inflation worries are back on the radar screen. The Labor Department said consumer prices increased 0.5%, a fourth straight monthly increase led by rising energy, transportation and clothing costs. Seventy economists polled by Bloomberg News expected an increase of 0.3%, so they missed the mark once again. It may look like a small difference, but on an annualized basis the number implies inflationary pressures at 6% versus the forecast of 3.6%. Treasury bonds reacted strongly to the downside while the dollar moved higher with expectations the Federal Reserve would be forced to raise interest rates sooner than expected. Take a look at the daily chart of the Ten-year Treasury Note Yield and you can see the sharp increase in the last week and a half.

In the last nine trading days we have seen extraordinary market volatility attributed to three key pieces of economic data. The one thing that occurred to me above all is that the economists’ forecasts have been way out of the ballpark on each one, and each release has sent interest rates noticeably higher. The first knockout number came two Fridays back when job creation for March was expected to come in at 120,000, but the reported number was 308,000. Yesterday economists were expecting an increase in retail sales of 0.7% and the number came in more than double at 1.8%. Today the CPI was reported 40% higher than anticipated, and once again the bond market sold off forcing interest rates higher.

<cut>

A Turning Point?

We have now seen three stellar economic reports depicting economic recovery and forcing interest rates higher, but I am not fully convinced it will be sustainable. I believe the market is telling us a major turning point is near at hand, but I don’t think we’re there quite yet. While interest rates have shot up to their highs for the year, they are still at historic lows. When we have all this market noise of big news headlines it forces me to take a few steps back to look at the big picture. Back to the top of the Wrap-Up, you can see the spike in interest rates from the recent economic data, but you should also notice the relative strength indicator stands in overbought territory. By the inverse relationship this also means that bonds are oversold on a short-term basis, ready for a rebound. Now take a look at the longer term weekly chart.

<cut>

Guaranteed Inflation

The Fed has virtually guaranteed they will err toward the side of inflation, and they must. Our monetary system is based on debt where money is borrowed into creation. I still maintain the belief that the bond market is far more important than the stock market. The Federal Government MUST continue to borrow money just to pay their bills from month to month. They can’t afford a meltdown in bonds! From the previous graph you see the downtrend in rates is still intact, but now look at the weekly chart for the Dow Jones Industrials.

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

[ozymandius]

2. Editorial: The Inglorious End of "Bull" Street

Riding High Before the Fall
by Robert B. Gordon, Sc. D.

In the fifth year of the greatest bear market in world history, our financial industry is riding high, piling profits on profits given to them on a silver platter by the Fed‘s benevolent low interest rates. The brokerage and fund experts march across the "QNBC" stage daily, offering one optimistic forecast after another to the great detriment of the average American investor. This sorry spectacle is heading for an inglorious end in my considered opinion. The profound changes in "Bull" Street will be interesting to watch.

<cut>

STOCK MARKET AND BUSINESS CYCLES FOLLOW A NATURAL LAW

Known only to a very tiny number of investors is the pioneering work done in the 1930s by Ralph Elliott, a retired accountant. Reportedly ill and seated in a rocking chair, he perused hundreds of stock charts over a limited time period and evolved a series of principles that dominate all stock charts in every currency and every time interval from seconds to centuries. His brilliant work was published during the Great Depression under the title of the Elliot Wave Principle.

His followers have extended his work backwards to the London stock market in early 1700. Elliott’s pioneering discoveries have been duplicated by independent work in the mathematical field of fractal geometry. Elliott’s laws are known to have a parallel in some phenomena found in nature, like snowflakes and sea shells, since they all obey the Golden Number series rediscovered by Fibonacci, a13th century mathematician.

<cut>

WHO IS TO BLAME FOR THE COMING GREAT DEPRESSION?

The list of guilty is indeed very long, but surely our entire economic profession takes first place with no competition. They misread all the events of the 1929 Crash and Depression and are repeating them again today with no apparent knowledge of the guidance available from the Elliott Wave Principle. If this failure ever becomes public news, a once honored profession will be in disgrace.

http://www.financialsense.com/editorials/gordon/2004/0414.html

[UpInArms]

3. daily dollar watch

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

Last trade 90.41 Change +0.17 (+0.19%)

and it's MaeveDay!

http://cbs.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38092.3559259259-813673243&siteID=mktw&scid=0&doctype=806&property=&value=&categories=&

U.S. jobless claims highest in a month

WASHINGTON (CBS.MW) - U.S. weekly jobless claims rose to their highest level in a month in the weeks ending April 10, the Labor Department said Thursday. The seasonally adjusted four-week average of first-time filings for state unemployment benefits rose by 6,750 to 344,250, the highest level since March 6. Wall Street economists expected a slight increase in filings. Initial claims in the most recent week jumped by 30,000 to 360,000, the highest since early February. The data in the first week of April are particularly difficult to seasonally adjust, a Labor Department official said.

...more...

Well, the dollar is climbing in response to the inflation numbers that suggest that a rate increase is on the way (sooner than later), but imho this administration is happy to allow rumors to dictate reality and they rarely coincide.

I take a "wait and see" attitude as the "weaker" dollar suits their "stronger" dollar policy much better.

Good Morning Ozy and 54anickel and all the Marketeers! :hi:

[Maeve]

4. Great googli-mooglies! I forgot it was Thursday!!

Intial Claims were expected to hit 335K, up from 328K, but they rocketed to 360K (hey, they wrote "dived" and the like last week--I get "rocketed")

Oh, yeah--last week's was revised up to 330K

[Frodo]

6. So let's see...... hmmmm.

The initial claims number came in much higher than expected... sooo... that means things might NOT be taking off so fast.... and maybe the Fed won't raise rates as fast to fight inflation...sooo....

BIG up day on the markets!!! Right?

Right???


< /crickets>

[Frodo]

7. oh. I didn't notice the Empire State index

Maybe it will be an up day.

Big jump in the index from 25.3 to 36 (expected 25-29). This brings it back close to the record high from a couple months ago.

[jamesinca]

8. The Empire State index of importance

Listening to AAR this am they read some poll that showed John Kerry leading by a 2:1 margin over Bush in the Empire State.

That is the best Empire State index in over 3 years.

[jamesinca]

5. Good morning all, revised UE numbers

Reuters
Jobless Claims Rise More Than Expected
Thursday April 15, 8:32 am ET


WASHINGTON (Reuters) - The number of Americans filing initial claims for jobless aid rose a sharper than expected 30,000 last week, the biggest jump in over a year, according to a government report on Thursday that could temper budding enthusiasm over a U.S. labor market revival.
First-time claims for state unemployment benefits climbed to 360,000 in the week ended April 10, their highest level since early February, from a revised 330,000 in the prior week, the Labor Department said.

The increase in initial claims was the largest weekly rise since December 2002.

Wall Street economists had expected claims to rise to only 335,000 from the more than three-year low reached in the previous week.

http://biz.yahoo.com/rb/040415/economy_jobless_1.html

[ozymandius]

10. Do you remember the trumpeting from the previous jobless claims?

The usual suspects, Hastert and Frist, clamored for Bush's economic policies such as tax cuts and monetary policy to be made permanent. This was due to the "real results" of job creation.

Ha ha ha ha ha ha ha!

[jamesinca]

18. with some thought about your post

I wonder if they ever brag about the revised numbers?

[54anickel]

9. Jobless Claims Jump, Factory Survey Rosy

http://biz.yahoo.com/rb/040415/economy_1.html

snip>

NOISE?

Economists on Wall Street also said the data should be viewed with some skepticism.

snip>

In the claims report, the department said the number of people on the benefit rolls who had already received an initial week of aid dropped 22,000 last week to 2.98 million, the lowest level since July 2001.

The decline in so-called continued claims could signal improved job prospects, but may also reflect workers falling off the rolls as benefits expire.

FACTORY REVIVAL

snip>

The two-year-old Empire Manufacturing Survey's business conditions index rose to 36.05 in April from 25.33 in March, moving back toward February's record high of 42.05.

snip>

The prices paid index rose to a record high of 56.19 in April from 50.00 in March. The prices received component ticked up only slightly to 12.38 from 11.76, suggesting profit margins were being squeezed.

snip>

Expectations for six-month ahead pulled back slightly to 48.91 from 53.03 in March, though that remains high historically.

/snip>
Historically? Am I misunderstanding something here? A two year "new" type of survey, and they are talking historically about a figure looked at for 6 months?

[Maeve]

11. 9:34 and the wheel spins

Dow 10,392.07 +14.12 (+0.14%)
Nasdaq 2,027.56 +2.71 (+0.13%)
S&P 500 1,129.84 +1.67 (+0.15%)
10-Yr Bond 4.380% -0.002

Another slow connection day for me--I'll try to kick in a few posts, tho.

[54anickel]

12. Rothschild, the bank built on gold, quits market

http://news.independent.co.uk/business/news/story.jsp?story=511516

After 261 years, N.M. Rothschild & Sons, the most prestigious bank in the City of London still owned by its founding family, shocked the financial world yesterday when it pulled out of trading in gold and other commodities.

The chairman, David de Rothschild, said: "Our income from commodities trading in London, including gold, has fallen as a percentage of our total income in each of the past five years. Following a strategic review of our activities we have concluded that this is no longer a core area of activity and have, therefore, decided to withdraw from the market.

"We remain committed to growing further our activities in specialist commercial banking, private banking and trust services, and objective relationship-based investment banking advice."

As part of the decision, Rothschild will no longer take part in the twice-daily London Gold Fixing, which it currently chairs and which has been held in its offices since 1919.

more...


edit to add -
Rothschild Australia retrenches seven traders
http://biz.yahoo.com/rm/040415/financial_rothschild_commodities_australia_1.html

SYDNEY, April 15 (Reuters) - NM Rothschild & Sons Australia has retrenched seven people following a decision to stop volatile commodities trading on its own books in favour of pursuing more work for clients.

Rothschild Australia Chief Executive Richard Martin said the company wants to focus on resources clients after its London headquarters said on Wednesday it was quitting commodities trading.

"We've let seven traders go," Martin said by telephone, adding eight support staff who process or document trades will also lose their jobs within six months.

snip>

"What we're trying to do is create a more client-focused business. The people who do the hedging for clients, we're keeping," he said of 12 remaining commodities traders and sales people who mainly focus on precious metals.

more...

[tlcandie]

13. So please...what does this mean in the bottom line as to how it affects..

the whole picture, 54?

[54anickel]

14. I'm not sure yet, will need to do some more digging over a couple

of days, but they were one of the biggest "price manipulators" at one time.

From the article:

After the First World War, the victorious governments were anxious to stabilise the price of gold, and asked Rothschild to organise what became the London Gold Fixing. Despite the development of 24-hour trading, at 10.30am and 3pm, every day for the past 85 years, representatives of the five leading London gold dealers have met at Rothschild's offices in St Swithin's Lane to fix the price.

[KoKo]

15. Well, this is an interesting bit of history from the "Independent" article

In 1825 Rothschild rescued the Bank of England after a run on gold, causing an economic crisis and the collapse of 145 banks. Rothschild shipped £10m of gold into the Bank and became its official gold broker. Rothschild manufactured gold bars for more than 100 years, until 1967. It also owned and operated the Royal Mint. By the end of the 19th century Rothschild had twice bailed out the US government when its gold reserves fell to what were regarded as dangerously low levels.

[54anickel]

21. A bit more history here -

Seems gold hedging has lost its profitability

Rothschild's retreat signals end of era
http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1079420346764

One of the oldest rituals in the City of London is about to change for ever with NM Rothschild exiting the gold business.

The London gold fixings has taken place twice a day on the third floor of Rothschild's office in St Swithin's Lane for the past 85 years.

Five men sit behind desks, each equipped with a little Union Jack. The men, deputed by investment banks with bullion trading activities, search for an agreed price after discussions with their dealing rooms and clients on the price for gold, in order to set a benchmark price for trading in gold each day.

snip>

The bank generated just £4.6m ($8.2m) of dealing income last year, or 2.2 per cent of the bank's total operating income.

This still allows the operation to just cover its costs but the trend line is not encouraging: five years ago dealing income was £14.2m, or 8.6 per cent of the total.

Mr de Rothschild says the bank's gold operations consisted mostly of hedging gold producers' exposure to the market.

more...


There's been a lot of unwinding of hedges in the gold market being reported. Some days you could see it taking place in the charts as well. Think JP Morgan is still doing a lot of hedging for miners, but the miners have been reducing those positions - if what's being reported in that are is true.

Here's an article that states they've decreased by some 80%.

http://biz.yahoo.com/rm/040415/markets_gold_gfms_3.html

snip>
DE-HEDGING TO RISE

Although gold de-hedging fell in 2003, gold producers cutting back overall on forward sales was seen as another major factor in the precious metal's rise, the group said.

GFMS said that gold producers were expected to keep trimming their hedge books in 2004, with producer de-hedging seen rising to between 340 and 400 tonnes, after falling 310 tonnes in 2003 to levels last seen in 1996.

"The report states that 83 percent of total de-hedging was completed in the first half of the year and was, therefore, arguably the dominant factor supporting higher prices in the six months to June. In the second half, the focus shifted to gold investment demand as de-hedging slowed," GFMS said.

[KoKo]

23. The Rothschilds are also renowned for "seeking stability and peace"...

Rothschild interests touch virtually every aspect of our lives. They have controlling interests in companies like Royal Dutch Shell and De Beers. Following World War II they invested in vast areas of resource rich properties in Canada, possibly gold rich deposits. Their influence extends to the U.S. Federal Reserve, helping to set monetary policy of the world's most powerful nation.

What is unique about old power and money of the Rothschilds is their uncanny ability to sustain their power and wealth, and keep it within the family. It is the power of family and faith which makes such wealth and power sustainable. Ironically, it would seem that they are motivated not so much by gaining more power and control but by a need to maintain a sense of security against historical discrimination due to their faith and financial prowess. Nevertheless, they do control and influence.
What is most unique about the Rothschilds, that seems to differ from all other influential merchant banking interests (e.g. Rockefellers), is their continued bullishness on gold exhibited through their involvement in gold trading and investment in gold real estate (financing of gold mining companies).

The Rothschilds are also renowned for seeking stability and peace, since chaos and war ultimately leave their wealth more vulnerable.

http://www.gold-eagle.com/gold_digest/alberta909.html

[KoKo]

27. And another interesting thought of "Two Scenarios" about the Rothschild's.

This article was written in 1997 but has alot about gold and Rothschilds which seems very relevant to our current situation. It's a bit :tinfoilhat: maybe and folks here are probably already familiar with the "Gold Digest." But, I posted because it seems so significant that Rothschilds are getting out of "hedging," that maybe there's something here which could make sense of it. Seems they have great interest in "stability." What are they up to, here? They are great friends with George Soros according to another aticle linked in "Gold Digest." Interesting...



The U.S. liquidity bubble is building again to unprecedented heights along with a speculative stock market bubble of unparalleled
proportions and unparalleled involvement by average citizens.


What would precipitate such a crash? There are points of vulnerability to the U.S. debt and market bubbles, notably a war in the Middle East, environmental "Acts of God" disasters (El Nino), and votes of non-confidence by the Japanese or Chinese holders of U.S. treasuries. The best case scenario might see a doubling of oil prices, as in 1979 that preceded the rise to $850 gold, or a food shortage combined with energy shortages (due to war) that would drive inflation and send gold skywards. But is the current situation more like the 1980s or the 1920s?

There is a second, more sinister possibility. That a crash is being orchestrated, as McFadden and others suggested occurred in 1929. But how and why? The history of the 1929 Crash and history of the Fed provide clues. The U.S. liquidity bubble is building again to unprecedented heights along with a speculative stock market bubble of unparalleled proportions and unparalleled involvement by average citizens. One push over the edge and the house of cards collapses. But to what end would some as powerful as those who control the Fed seek such calamity? Possibly to set the foundation for a new monetary system rationalized on the basis that the existing system failed to provide checks and balances to prevent such a calamity. Such a new and global monetary system could be argued as being conducive to peace and harmony. Has coined liberty been sufficiently neutralized? The current Fed was rationalized on the basis that historical private financial institutions were inherently unstable and vulnerable to continual collapse. They might argue that "never again" shall we have irrational markets and unstable fiat currency systems. A new system could be built using a global electronic funds transfer system, the perfect saviour of unstable fiat currencies.

Such a new system would eliminate the need for both fiat currencies or any other stores of value, including gold. Having manufactured a sentiment against gold, confidence in the current U.S. dollar or future forms of currency (electronic) has been eliminated. Even with U.S. citizens now allowed to buy gold, gold no longer may be viewed as a threat and, if it were, another "Roosevelt" bill could be enacted to collect the gold under emergency banking regulations... Ultimately, the system is still controlled, yet now the control would extended beyond the U.S. Fed and throughout Europe and Asia. Preposterous? I shall leave that to your contemplation and coffee house chats!

Given these two possible scenarios, if you believe in the first scenario, then gold is still the investment of choice given the certainty of market implosion. Under the second scenario, gold may never have its day in the sun because it has been orchestrated that way. If you are a Rothshild you win in both scenarios.

http://www.gold-eagle.com/gold_digest/alberta909.html

[54anickel]

46. GACK!!!

I don't know what to make of any of it KoKo, but this part surely seems to ring true -

Most of us are ignorant of the apparent dominion and tutelage underlying our economic lives. With our basic needs met, we have no need to question to, seek knowledge, to rebel, or to ask questions. In the words of Noam Chomsky, our consent may already be subtly manufactured.

But so what? Have we not benefited from a grand meal our "parents" have served us for all these years. The children are content and naive. Yet our naiveté, complacency, and ignorance is in itself dangerous. Most of our life is lived as if behind a veil of uncertainty.

We have assumed that all things are good, that someone is ensuring our system does not fail, and that if a financial crisis ensues that there is a better system nodding our heads that the current one was after all unsustainable. Those of us with intuition and an analytical capability to catch glimpses of such control and power, can be easily be discounted as crack-pots or deluded conspiracy freaks. Without concrete evidence, all illusions become reality. While we might suspect the system is rigged, we often lack evidence of such control since the very media which provides us with information could be under the same control.

[KoKo]

54. Global transfer funds replacing "unstable fiat currencies." Where might

gold fit into this? How would this work? What would they base the value of the electronic funds on? Is this what the Rothschilds are thinking of? They don't need to "hedge" gold anymore, because they will be doing "other" things with it? :shrug:

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

A new system could be built using a global electronic funds transfer system, the perfect saviour of unstable fiat currencies.

[UpInArms]

56. this has that ring of the "cashless society" that

there has been a great push toward.

Methinks we are in deep trouble. :(

[KoKo]

60. Yes, that's what I thought, but where does gold fit in? If we believe

Puplova, then maybe the "cashless" would be replaced with somekind of "world gold standard" controlled by the same folks who control it now, but not responsible to individual countries but the "Rothschild & others" Cartel?

Should I put my :tinfoilhat: on here. Or is this a possibility. Reading the article I linked with the Soros connection and that the Rothchilds like "peace and stability" it's not to great a leap to wonder what's going on. :shrug: Remember Soro's gift of 200 Million to help a Democrat get elected?

This is very worrysome....

[Maeve]

16. 10:10 and the picture changes

Dow 10,392.92 +14.97 (+0.14%)
Nasdaq 2,019.66 -5.19 (-0.26%)
S&P 500 1,129.46 +1.29 (+0.11%)
10-Yr Bond 4.371% -0.011

10:00AM: After setting new session highs, the major averages are back near the lower end of their trading range, with the Nasdaq flirting with negative territory... The bulk of the sectors are little changed, but among the leaders to the upside are the drug, oil services, utility, steel, homebuilding, and coal sectors... Laggards of note include the internet, semiconductor, computer storage, managed healthcare, airline, and insurance groups...

http://finance.yahoo.com/mo

I think we're into that 50-50 chance of ups & downs...

[54anickel]

17. Using the Consumer Price Index to Rob Americans Blind

http://www.gold-eagle.com/editorials_04/benson041404.html

Most Americans have been led to believe that the Consumer Price Index (CPI) actually measures, from one year to the next, the "cost of maintaining a constant standard of living" as the prices for goods we purchase increase. Indeed, we are foolish enough to believe that the index is an accurate measure of the price increases for the same basket of goods we buy every year.

If this were actually true, the index would show an honest increase of 3% - 4% in price, there would be no productivity miracle, interest rates would be much higher, and bond and stock prices would be lower. Of course, with an election approaching, our elected officials don't want the CPI to be an honest measure of the cost of maintaining the same standard of living or quality of life. They want a politically convenient index, cleverly devised to hardly ever rise at all!

What you should find unsettling and fraudulent are the ways that the CPI is manipulated to ensure there is no inflation, regardless of how high the prices rise for things we must buy to live. Manipulating the CPI - specifically because the benefits to the retired on Social Security, Medicare and Medicaid are tied to it - and making people believe that inflation is low, will keep the "fraud" of monetary inflation alive. The government simply can't afford to keep the promises it has made, and it needs to use this clever accounting fraud. If productivity is really so high, why isn't government policy pushing through a 10% flat increase in Social Security benefits so that the retired can get their share of the productivity miracle? (Maybe the real miracle is robbing them without them noticing!) By changing the definition of "what inflation is", our government won't have to pay nearly as much to retirees as they were anticipating. The implications of defining inflation away are vast, and the magnitude of the fraud is extraordinary!

The primary sources of manipulation are: 1) Making sure the wrong items are in the index; 2) Taking "hedonics" to ridiculous extremes; 3) Getting consumers to do more of the work and receive less services; and, 4) Changing to a Chain Weighted Index.

more...

[JNelson6563]

19. Anybody catching any Quarterlies?

Man the profits are rollin' in! Seems banking is doing very well. Citing their credit card income as a real kicker. I remember stating that very thing not long ago only to be told by a certain banker how those poor banks don't hardly make anything off that. Those great philanthropists, the bankers. Ugh.

Julie

[Frodo]

20. I believe I was that banker. And I stick by it.

Most banks (the VAST majority) don't even have their own credit card operations anymore. There are a couple big "banks" that are essentially "credit card only" that I didn't consider "banks" in that post (they don't take deposits, don't make car/home loans etc) and a handful of the truly huge banks "Citi, BofA, etc" who are huge enough to essential have "credit card only" subsidiaries.

Both of these types of companies CAN benefit from positive changes in that line of business. It's unlikely that rest of the industry sees much of anything from it. If your bank isn't one of the top 10-15 or so in the country (out of thousands of banks), it probably doesn't have any positive impact from the business...

I'm confident that if you find my post on the subject you will see I'm consistent on the issue.

[54anickel]

26. Wouldn't those "big banks" be all the ones that are publicly traded

on the stock market? Or to re-phrase the question, don't all the banks that make up the finance/banking sector that they mention in the blather deal in credit cards?

I really don't know, I've never looked at the list that makes up the sector as a whole. :shrug:

[Frodo]

29. Nah. There are a handful of truly HUGE banks...

Then a number of "super regionals" in the $10Billion to $150Billion range. Then Hundreds of "medium large" banks going up to around the $10B line. Most of these are "public ally traded" on major stock markets.


There are certainly thousands of banks that are NOT on the DOW or Amex, but the dividing line is WAY WAY WAY below the line of "who deals heavily in credit cards".

[JNelson6563]

68. Yes, you're the one alright!

The only person I ever met in banking with such a "Gee whiz Skippy" kind of view of the industry.

I am sure that banks outside of the top 15 are merely doing credit cards cause they're a bunch of nice guys and they don't care about profits.

Don't even get me started on predatory lending practices....

We'll never agree because we have fundamentally different views of the industry. I predict we will continue to see stellar profits for banking. Just as I said before. Read my post, I think you will see I am consistent on the issue.

Cheers! :toast:

Julie

[Frodo]

70. Gee whiz skippy! :-)

Ever know anyone who worked in banking for more than a long lunch break?

I am sure that banks outside of the top 15 are merely doing credit cards cause they're a bunch of nice guys and they don't care about profits.

If you take a look at one of those credit cards you're more than likely to find that the were just selling it as an agent for MBNA, or Capital One or Citi etc. etc. etc.

So sure, they're looking for profits, but they made most of it when they brought in your application.

[JNelson6563]

86. heh heh

Ever know anyone who worked in banking for more than a long lunch break?

Um, yes. In fact, I am sure you'd be rather surprised.

How do ya think I got so cynical er, Skippy? ;-)

Julie

[Frodo]

36. Hey J ?

Did you get out of some bonds?

It ain't over yet.

[jamesinca]

22. At 10:49 NY time

it all goes red.

Dow 10,377.31 -0.64
Nasdaq 2011.23 -13.62
S&P 1127.69 -0.48

[Maeve]

25. 11:03 and redder still

Dow 10,362.38 -15.57 (-0.15%)
Nasdaq 2,008.00 -16.85 (-0.83%)
S&P 500 1,125.40 -2.77 (-0.25%)
10-Yr Bond 4.366% -0.016

[54anickel]

28. Still laying the cause to an anticipated interest hike. Yet, toward the

end of each day they say the decline was pricing the hike in. How long will it take for them to finish "pricing it in"? :shrug:
This is getting old, starting to sound like Shrub with his blaming all the violence in Iraq on "foreign fighters". Sooner or later folks have got to realize it is the Iraqi's themselves there. How long before the "blatherers" realize it's the stocks and their high valuations compared to P/E ration themselves?

11:00AM: New session lows for the market, as this morning's batch of better than expected earnings reports has proven insufficient to outweight the market's concerns over the rising interest rates... This morning's economic reports, including the NY Empire State at 36.1 (consensus 29.0), once again pointed out that the economy is accelerating and the Fed may tighten sooner than previously anticipated... In its decline, the Nasdaq has slipped below its 50-day simple and exponential moving averages at 2015 and 2013, respectively, inciting added selling efforts in the broader market...NYSE Adv/Dec 1648/1348, Nasdaq Adv/Dec 1103/1778

[54anickel]

24. FOREX-Dollar pares gains vs euro on claims, asset flows

http://www.forbes.com/markets/newswire/2004/04/15/rtr1333182.html

NEW YORK, April 15 (Reuters) - The dollar pared gains but remained higher against the euro on Thursday after a bigger than expected rise in U.S. jobless claims and data on flows into U.S. assets disappointed the market.

The dollar lost some ground against the euro after the Treasury Department released data for February showing net foreign purchases of U.S. assets totaled $83.4 billion, compared with net inflows of $92.0 billion in January.

"That is a number that the markets were expecting at the very least and you could see the dollar sell off slightly," said Paresh Upadhyaya, portfolio manager with Putnam Investments in Boston.

big snip>

"Clearly there has been a fairly dramatic move in interest rate markets on the back of the strong data. Now the market is fully pricing in an August (interest rate) hike, which has been a major dollar driver."

Analysts say the Federal Reserve may be reluctant to raise interest rates unless the U.S. labor market shows signs of sustainable improvement. U.S. rates at 1 percent, their lowest since 1958, have weighed on the dollar as investors seek higher returns elsewhere.

[KoKo]

30. AHA! The Fed may be reluctant to raise interest rates....Gotta keep

those rates low so that Shrub's Economic disaster doesn't fall on his head right now with all this other problems...


Analysts say the Federal Reserve may be reluctant to raise interest rates unless the U.S. labor market shows signs of sustainable improvement. U.S. rates at 1 percent, their lowest since 1958, have weighed on the dollar as investors seek higher returns elsewhere.

[54anickel]

32. Yep, and the only excuse they have to keep them down now is the

employment picture. Sort of painted into a corner now. Employment too low and they get socked with "jobless recovery", too high and there will be screams for a rate hike now that the inflation genie is out of the bottle.

Remember that ranting from yesterday by The Mogambo Guru about the appointment of Janet Yellen?

snip>
Then, to make matters worse, the WSJ had an article by Greg Ip on Tuesday that caused my blood to run cold. The headline was "Yellen Is to Head San Francisco Fed Following Parry." This flaming nincompoop, Janet Yellen, thinks that goosing employment is more important than controlling inflation, and is on record as arguing that inflation should not be allowed to drop below 2%! When I read that, all three remaining brain cells in my brain went into spasm.

This mental midget, and for those of you who have not been paying attention I remind you that her name is Janet Yellen, actually WANTS price inflation to rise, which, unless wages also rise by more than that, will cause a fall in standards of living! She wants us to have a falling standard of living! And since wages do not rise across the board, the people at the low end of the scale pay a heavy price, as their wages always seriously lag. So remember what I said about Janet "Jackass" Yellen, as you will find that you will spend a considerable amount of your time in the future cursing her name.

Greg Ip, bless his heart, wrote "Her appointment continues an unusual amount of turnover in Fed policy makers." This may be the biggest understatement of the century, as the Fed has metamorphosed into an America-killing inflation-machine, and if I thought Ben "Bonehead" Bernanke was bad, this Yellen succubus is a horror straight from hell.

[UpInArms]

35. historical info on Yellen

http://www.businessweek.com/1997/09/b3516111.htm

excerpt:

The couple has been collaborating professionally for more than a decade. At Berkeley, they conducted groundbreaking research that refuted prevailing wisdom about how the economy functions (table). In the 1970s, economists such as Robert E. Lucas Jr. of the University of Chicago had argued that using monetary and fiscal policy to move the economy was futile, since people adjust their behavior in ways that negate the policy changes. This ''rational expectations'' theory gained widespread acceptance at the expense of the Keynesian school, which held that the government could act to smooth out business cycles.

But in a landmark 1985 paper, Yellen and Akerlof argued that individuals lacked the time and resources to conduct the intensive research. Such a deviation from Lucas' assumptions, when magnified, might mean that an interest-rate cut could have a major impact on the economy. Former Fed Vice-Chairman Alan S. Blinder says the couple's research ''has given theoretical economic underpinnings to the New Keynesian school,'' which explains why government intervention in the economy is sometimes justified.

RELUCTANT AT FIRST. Yellen, who was sworn in to the CEA job on Feb. 13, has quietly emerged as a forceful figure on her own. As a Fed governor since 1994, she helped convince fellow governors that downsizing and foreign outsourcing was enabling the economy to run with lower unemployment and less inflation than was thought possible. Last fall, Yellen and Fed Chairman Alan Greenspan joined in arguing that the strong economy wouldn't trigger an inflationary spike--a call that appears shrewd today. ''Janet pushed for more conceptual analysis within the Fed,'' says one central bank colleague. ''She wanted the Fed to ask less 'What's the Chicago Purchasing Managers Index?' and more 'What are the broader forces affecting the economy?'''

...more...

:puke: :hitsheadonwall:

[KoKo]

40. Yes....I see now why Mogambo called her a "Succubus"....and was whigged

out over her appointment. This great new economic "experiment"is being practiced on the American people at the worst possible time and we are just the lab rats. At least Reagan's folks had the wisdom to get rid of their "supplysider experimentor," before he did too much more damage although the theory never went out of favor with some of them. What was that guy's name? Stockman?

[UpInArms]

42. here's some supply side background

and the name was David Stockman

http://www.worldhistory.com/wiki/s/supply-side-economics.htm

In 1981 supply-side economist Robert Mundell, in 1999 to win the Nobel prize for "for his analysis of monetary and fiscal policy under different exchange rate regimes and his analysis of optimum currency areas", told Ronald Reagan that theory predicted that by cutting upper bracket taxation rates, and by lowering rates on capital gains, it would be possible to raise government revenues while cutting taxes. Subsequent budget years did not bear out this prediction, and between 1986 and 1994 a series of tax restructurings and tax increases were passed which raised the percentage of GDP taken as federal taxes to the same level that it had been in 1980. David Stockman, the self-proclaimed supply side Budget Director under Reagan later admitted that the "Rosy Scenario" which he used to justify the predictions was "cooked" and "So the supply-side formula was the only way to get a tax policy that was really 'trickle down.' Supply-side is 'trickle-down' theory."

Critics of supply side economics, cited this as proof that the theory had failed, and that the lack of academic credentials by movement leaders such as Jude Wanniski and Robert Bartley show that the theories were bankrupt. Mundell in his Nobel prize lecture countered that the success of price stabilty was proof that the supply-side revolution had worked. The continuing debate over supply-side policies tends to focus on the massive federal and current account deficits that have accumulated in the US since 1980.

[KoKo]

62. Thanks UIA's. This is an excellent read to remind us and help in putting

pieces of this puzzle together. I wasn't aware of the latest on this especially that Wanniski and Bartley were connected. I'm assuming that's the Bartley who headed the Wall St. Journal and was instrumental in further the interests of those who worked to bring Clinton down? And, isn't Wanniski allied with the PNAC crowd? :shrug:

[UpInArms]

73. More on Wanniski and Bartley

http://www.wsws.org/articles/2001/jan2001/med6-j08.shtml

excerpt:

As noted, there is nothing surprising about the Wall Street Journal's response. After all, the daily newspaper of the financial elite spent the past seven years first de-legitimizing and then attempting to destabilize the Democratic Clinton administration through all the sordid twists and turns of the Whitewater, Paula Jones and Monica Lewinsky scandals, culminating in the impeachment and Senate trial of Clinton.

The Journal's editorial and op-ed pages have been in the thick of every assault on democratic rights in recent years. The newspaper's editors distort, manipulate and lie in the pursuit of their right-wing goals. Innuendo, character assassination, smears, guilt by association, political witch-hunting—these are their stock in trade. The Journal's editorial page writers cannot properly be described as journalists. It would be more accurate to characterize them as political provocateurs and right- wing thugs in print. Over the past decade in particular, these people have carved out a sinister niche for themselves in American political life.

Robert Bartley is the chief editorial thug. Born in Minnesota and raised in Ames, Iowa, the son of a veterinarian, Bartley went to work for the Journal in 1962. After brief stints in its Chicago and Philadelphia bureaus, he joined the editorial page staff in New York City in 1964. He was appointed editor of the editorial page in 1972, editor of the Journal in 1979 and a vice-president in 1983. He has guided the newspaper's editorial policies for more than a quarter of a century.

Bartley is an ultra-right ideologue. By some combination of social and psychological processes he long ago developed a pathological hatred for the radicalism of the 1960s and lays virtually all of the evils of the world at its door. At the time of the shooting of Dr. David Gunn, who performed abortions, by a right-wing fanatic in Pensacola, Florida in March 1993, the Journal editorialized, “We think it is possible to identify the date when the United States ... began to tip off the emotional tracks.... The date is August 1968 when the Democratic National Convention found itself sharing Chicago with the street fighters of the anti-Vietnam War movement.”

<snip>

As Steve Rendall and Jim Naureckas of Fairness and Accuracy in Reporting (FAIR) point out in their “20 Reasons Not to Trust the Journal Editorial Page,” Jude Wanniski, one of Bartley's former sidekicks at the Journal and a longtime associate, in a letter to the New York Times in 1988 claimed there was no evidence linking Salvadoran military officer and politician Roberto D'Aubuisson to death squads, and labeled reports to the contrary as “McCarthyist” and “one of the most successful propaganda hoaxes of the decade.” D'Aubuisson's well-known ties to death squads and to torture of political prisoners were confirmed by internal Reagan administration memos.

The Journal's brutality and bloodthirstiness surfaced in response to the slaughter of virtually defenseless Iraqi troops in the Persian Gulf War. In February 1991 Bartley's editorial page called on “America's elite, long at each other's throat,” to draw the lessons of the war: “Force is a legitimate tool of policy; it works.... America can lead, stop whining, think more boldly. Starting now.”

Pinochet and D'Aubuisson are political kindred spirits of Bartley and company. Were there a military or fascist takeover in the US, they would preside over or support the same sort of murderous political cleansing operation as their Latin American counterparts. A fanatical anti-socialist, Bartley views working people, minorities and others with scarcely concealed contempt. He once commented that in the US “there aren't any poor people, just a few hermits or something like that” ( Washington Post, July 11, 1982).

...lots more...

and

http://www.pnac.info/cgi-bin/mt-comments.cgi?entry_id=18

excerpt:

To those who knew and worked with Wolfowitz's mentor, Wohlstetter, none of this is surprising. "Albert believed he was put here on earth to be a man who would increase the security of the United States at the expense of those who threatened that security, and he was never going to be satisfied until there was nobody around at all who owned a slingshot that would allow them to be a potential David against the American Goliath," says Jude Wanniski, the father of supply-side economics and a former Wohlstetter acolyte who broke with his fellow hawks after the Cold War. "He basically believed that was the only way for a truly secure peaceæand that America was the only country that could get a secure peace for the world. And part of that means, if you look down the road and see a war with, say, China, 20 years off, go to war now."

For almost 30 years, says Wanniski, Wolfowitz and Perle have complemented each other nicely as Wohlstetterian partisans, with Perle playing the tactician and Wolfowitz the more circumspect scholar. But around the end of the Gulf War, Wolfowitz was anything but circumspect, arguing not only for a final push to Baghdad but, later and more vociferously, for fielding U.S. forces in support of the ill-fated Kurdish and Shia intifadas against Saddam. Since then, he's backed all possible funding and support for the Iraqi National Congress, a hopelessly ineffectual expatriate (and, many say, corrupt) opposition group.

...more at link...

[54anickel]

77. Oh boy, I'm gonna have to bookmark this whole thread for later

reference now. So much info here today!

[KoKo]

84. Well, UIA's it seems that PNAC is intertwined with our Financial Guru's

and that except for the brief Clinton break, seems we've had a continuous reign of the "Supply Siders." Clinton's guys and Rubin "tweaked" it here and there and managed to get the deficit undercontrol after much wailing and teeth grinds,but the "supply siders" were still there at every turn. And Rubin wasn't tough enough when the "Tech Bubble" started to blow up. However, by that time he had Gingrich's take back of Congress to deal with and Clinton had his Monica problems, so here we are the the guinea pigs for a couple of decades of "Supply Side Theory" experimentation.

I don't know about you, or others here. But it stinks. And, I don't want to go down with their mistakes. :-( The guinea pig who didn't survive. I'm glad we here can discuss all this. It's helpful to hash this out, and most of all to learn from each other.

Thanks for your posts and links. Gotta go back tonight and do some heavy reading. :-)'s and a :toast:

[jamesinca]

43. In the Suskind / O'Neil book

I think it was Larry Lindsey. Big time supply sider that never advanced to a full proffesor at a university because of his way of thinking. He worked in the BushII admin and was fired. He is the one that had Bush's ear, O'Neil was just some old man yapping a bunch of non-sense. I am sure there are other screwd up people on that side of the equation but Lindsey is the latest.

[KoKo]

80. My husbands reading this and says it's a real eye opener. Lindsay does

come off as a "lightweight" but I guess when O'Neil got kicked out they went back to their old tricks and found another Lindsay type. That person is the one mucking around adding to the mess we have.

The Bush's can't do anything right. I don't know how we got a second one after the first was a disaster.

[UpInArms]

31. Inflation hesitation

http://money.cnn.com/2004/04/15/commentary/column_hays/hays/

NEW YORK (CNN/Money) - Everyone is getting excited or worried or happy -- depending on your view of inflation and where it's heading -- about the prospect of the Federal Reserve raising interest rates. But maybe we should all stop and take a deep breath, because there are still lots of reasons why the Fed is going to take it's time before it pulls the interest rate trigger, as one key official hinted this week.

Yes, it looks like the labor market has turned the corner, according to the March employment report. And new claims for unemployment benefits have been on a downtrend, notwithstanding the latest unexpected spike up of 30,000 to 360,000 -- the highest level since February and the largest one-week increase since December of 2002.

Inflation numbers yesterday were uncomfortably high, led by rising prices for services, especially medical care (no surprise there). One price that is NOT rising much, however, is the price of labor. Wage growth is still very anemic. There is still a lot of slack in the economy, both in terms of people waiting to get jobs again and excess capacity in factories and all kinds of businesses. Do you think that workers at your company are suddenly in a position to say "Hey boss! Give me a big fat raise or I'm outta here!" Most of us aren't.

If prices for things like gasoline keep marching higher, we will pay those higher prices and inflation will rise. But it will put many of us in a cost squeeze, leaving us with less money to spend on other things. So whatever bulge we see in inflation now may get dampened down. Yes, the Fed is going to raise interest rates. Everyone agrees the key short-term rate can't stay at a 45-year low forever. But if wage growth stays meager, their rate hikes may not come as quickly as the biggest inflation worrywarts are hoping, and the number of increases we see may not match the kinds of increases we have seen from the Fed in the past.

...more...

Yeah, that's the ticket! see my note in the dollar watch this a.m. Those rates will not be raised until after November. :shrug:

[54anickel]

34. Was there ever any doubt in your mind?

[UpInArms]

37. no doubt in my mind,

but I do doubt my mind :crazy:

[54anickel]

33. China's competitors will have to adjust-IMF report

http://www.forbes.com/personalfinance/funds/newswire/2004/04/14/rtr1332128.html

WASHINGTON 14 (Reuters) - The International Monetary Fund said on Wednesday countries competing in the same markets as China will have to adjust their product and labor markets to keep up with its explosive growth.

After years of isolation, China's economy has grown annually about 9 percent while its share of world trade has risen to almost 6 percent from 1 percent in recent years, raising concerns about the impact on the rest of the world.

In its World Economic Outlook, issued twice a year, the IMF said competing nations could minimize losses by increasing their own flexibility through structural reforms.

"A successful response to China's growth will involve significant inter-sectoral mobility. As resources move to more productive areas, transitional problems may rise, particularly for less skilled workers," the report cautioned.

more...

[54anickel]

38. Everyone's problem

http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1079420356348

The old adage "My currency is your problem" is the attitude with which US policymakers have in recent decades faced the rest of the world. And as the global market for capital becomes ever more unified, the US fiscal deficit is becoming everyone else's problem too.

The International Monetary Fund's criticism of profligacy in the US public finances has won it few friends across town in the White House and the Treasury. In its latest considered view on the subject, the IMF has noted that the US's feeble attempts to rein in its looming fiscal problem will have an impact way beyond its borders.

It might seem churlish to criticise America for boosting global demand by going into deficit over the past few years, a time when much of the rest of the world economy was close to stalling. Foreigners benefited mightily, since between a half and a quarter of the effect of US fiscal expansions is estimated to leak abroad. But as the Bush administration chooses not to hear, the problem is not the short-run deficits run up now as a result of the global economic slowdown but those that respectable economists predict will persist even when the US economy has returned to full employment.

The US borrowing spree will push up real interest rates on dollar assets, constraining investment and consumption such that the net medium-term effect of the recent US tax cuts on economic growth will quite probably be negative. It will also immediately affect the many emerging market nations that borrow in dollars, worsening debt positions that in some cases look precarious. Morever, the IMF reckons that in the medium term it makes sense to talk about a global real interest rate: rises in real US interest rates eventually tend to feed through almost one-to-one to other rich countries, crowding out investment and consumption.

more...

[UpInArms]

39. anyone have the dramamine?

11:38 am EST

Dow 10,386.25 +8.30 (+0.08%)
Nasdaq 2,010.42 -14.43 (-0.71%)
S&P 500 1,128.12 -0.05 (0.00%)
10-Yr Bond 4.396% +0.014

[KoKo]

41. Just 10 points to go down on the Nasdaq before something big triggers in.

Getting closer and closer every day. One wonders how long this will play out before the capitulation.

[Maeve]

45. 12:17 and not getting any easier to stomach

Dow 10,370.64 -7.31 (-0.07%)
Nasdaq 2,003.02 -21.83 (-1.08%)
S&P 500 1,125.90 -2.27 (-0.20%)
10-Yr Bond 4.410% +0.028

Why do I keep feeling like I did last weekend at the amusement park? Too many roller coasters in too short a time (the "joys" of season passes and early previews!)

[Frodo]

44. Now tha Philadelphi Fed number surprises to the upside.

Comes in at 32.5 on top of last month's 24.2 (expected 26). Even the bullish "briefing.com" that had raised it's expectation immediately following the Empire Index surprise had only raised it to 31.

Still a bit under January's "highest in a decade" of 38.

[UpInArms]

47. a side serving of noon blather to go with that

12:00PM: Although in the pre-open session it looked like the market was going to be able to shift its focus off concerns over rising interest rates and to the generally favorable earnings reports, the morning activity has proven otherwise... Accordingly, after a favorable open, the market has spent the bulk of the session on a downward slope, with the Nasdaq spearheading the decline... The relative underperformance of the tech composite has been sponsored by the influential networking, storage, software, telecom, and semiconductor sectors...

The weakness in the latter is particularly striking on the heels of a batch of better than anticipated earnings reports from the likes of Advanced Micro Devices (AMD 16.09 -1.03), Fairchild Semi (FCS 23.32 -2.04), Lam Research (LRCX 25.75 -1.07), and Cypress Semi (CY 19.62 -0.73)... Other laggards of note include the banking, broker/dealer, insurance, airline, casino & gaming, and iron & steel sectors...Among the leaders to the upside are the real estate operations, drug, oil & gas services, and coal sectors...

Note that the drug sector has been resilient of late as investors have looked for defensive positions in the rising interest rate environment... Briefing.com, for its part, believes that concerns with regard to rising interest rates are justified and reduce the upside potential for the stock market as several rounds of tightening are likely over the coming year... Nevertheless, interest rates are not at a level where they have started to impact the models and a conservative long-term investment stance remains warranted... This morning's economic reports were mixed...

[54anickel]

49. HA! briefing.com, for its part, -

change their minds more often than I change my shorts! :evilgrin:

[54anickel]

48. KoKo, help me out here as one of the long time market watchers -

Can you remember a time when so many economist have been so far off on their estimates of so many reports, by so much, in such a short time span (what a month here?).

Is this not unprecedented? I'm not that long time of a watcher, but have been a long time student of economic history - this stuff is not ringing a bell with me, but it may not be the sort of thing that makes it into the archives. :shrug: :tinfoilhat:

[KoKo]

58. It's not so much that all the economists are off in predictions that's

worrysome because I've heard more discussion through the years by market analysts using the analogy of: "Put a hundred economists in a room and they will all come up with a different forecast."

What's been odd is that the markets always reacted to news and rumor and would rise an fall based on that with bigger swings than we are seeing. Our markets aren't plunging on what's going on in Iraq, or bad employment numbers, or Credit Card Debt and all the rest of the indicators that our economy is not healthy like the record trade imbalances and debt. The Mutual Funds Scandals barely budged the markets where in years past it might have caused a panic. Some of that may be due to the fact that 401-K's are forcing folks to be in the maket and stay in it and that has changed the way the whole system works to make things more stable so that bad news doesn't have the effect it once would have. And, since there's no place else to get a return on investment for those who have something left to invest, I suppose that could also bring a forced stability to the stock market.

Still....

This market since Bush came in seems to be very "controlled." Our use of PPT comes to mind because we notice that there's always a "safety net" when the market really wants to go down, it never can fall as far as the Global news or the economic news would would seem to warrent.

Also, Greenspan/Fed seems to be much more involved than at anytime I remember going back into the mid-eighty's when I started watching the markets. The Fed was important then, but no one seemed to hang on every word coming out their mouth like now.

Actually "54" I find this all well...as upsetting as "Mogambo." Although I suspect that Mogambo is Libertarian leaning and so might be all the more worked up about what he/she sees going on since Libertarians are opposed to any intervention at all, and I do believe that "safety nets" are necessary in dire circumstance.

I'm very worried about this Rothschild thing with gold. I think that's
something which has to do with our markets and that something is about to happen. But, living in the Bush America it could just be induced paranoia from what we've seen of their incompetence.

I wonder if the "BIG GUNS" in the world aren't getting very concerned and rather than helping prop our markets, something is about to blow.

I don't know if I've given you any useful insight, but I'm very worried. Something just isn't right here. And, that's what you and the others here are picking up, I think.

[54anickel]

63. Thanks KoKo, you've given me plenty to chew on here. It does

seem that there's been a lot more "manipulation" than ever before. They have been trying to over come the nature of business cycles in all of their "experimentations" since the "crash" in 87.

Scary questions come to mind, have they only been successful in postponing a natural cycle and now that it has been trapped into a corner for so long it will come back even stronger and with more vengance?

All this talk of free markets and free trade taking being allowed to run their course in the labor market - sure on the working class, but they've not allowed that same "freedom" in the market place.

:tinfoilhat:

[54anickel]

50. Outrageous ads sign of speculative market

ANNANDALE, Va. (CBS.MW) - One of my informal indicators of an overvalued market is flashing warning signs.

My indicator is based on how many liberties newsletter advertisers are taking with the truth. It varies widely over a market cycle.

snip>

Extremes of greed, of course, more often than not occur near market tops.

Unfortunately for the bulls, recent newsletter ads incline me to believe that we're closer to the greed end of the spectrum.

more...

Gee, can we add to that all of the late night infomercials on how to make a killing day-trading with their "special" software and seminars that have been running lately?

[54anickel]

51. Floyd Norris: Greenspan races the rate clock

http://www.iht.com/articles/515266.html

snip>

It has been convenient for the Fed to assume that any inflation threat - and therefore any pressure to raise short-term interest rates - is far, far away. Speeches by Fed officials have downplayed inflation, and it will be interesting to see if that begins to change. "They will find themselves with a big credibility problem if they do not acknowledge that there is more inflation than they expected," said Roger Kubarych, an economist with HVB Group.
.
By engineering negative real interest rates - that is, rates lower than the inflation rate - Greenspan has boosted the economy at the risk of encouraging speculation. Some of the rise in copper - from 60 cents a pound, or E1.11 per kilogram, at the economic nadir in the fall of 2001 to a peak last month of almost $1.40 - is due to rising demand from real users. But some of it reflects speculation on borrowed money. Similarly, the search for yield has allowed companies - and countries - with dicey credit to borrow money cheaply. History says some of those loans will go bad in a few years, creating pain for investors.
.
Markets are starting to realize that the economy is too strong to justify keeping short-term rates so low. A federal funds rate of 2.5 percent, far above the current 1 percent, might be reasonable. That won't happen quickly, but expectations are growing that the Fed will have to begin raising rates well before this fall's U.S. presidential election. Now the Fed needs to gradually change expectations so that speculative trades can be unwound without doing unnecessary damage to markets.
.
"The last trick Alan Greenspan has to pull off," said Robert Barbera, chief economist of ITG/Hoenig, "is to get the federal funds rate up from crazy easy and still have everyone live happily ever after."

more...

So, can Greenspin pull another miracle outta his butt without causing the collapse of the huge derivative markets? :scared:

[KoKo]

75. Geeze, the derivatives..and much of our real estate holdings by Fannie May

and Freddie Mac are wading in them. Plus that this article says much of the boom in commodities is speculation on borrowed money?

How much speculation in our stock market is those folks using their re-fi's to trade using those nifty infomercial programs and the stuff that's touted all over the web.

I agree, "54" :scared: Plus what about our GDP based on consumer spending!

What a house of cards this is!

[54anickel]

52. Mortgage rates soar on economic reports

http://www.inman.com/inmannews.aspx?ID=40856

Mortgage rates climbed to fourth-month highs this week in response to positive economic news, according to surveys conducted by mortgage giant Freddie Mac and Bankrate.

In Freddie Mac's weekly survey, the 30-year fixed-rate mortgage averaged 5.89 percent, with an average 0.6 point, for the week ended today, up from last week when it averaged 5.79 percent. The average for the 15-year fixed-rate mortgage this week is 5.23 percent, with an average 0.6 point, up from last week when it averaged 5.12 percent. Rates on one-year adjustable-rate mortgage averaged 3.69 percent, with an average 0.6 point, up from 3.65 percent last week.

"With economic news continuing to point to a growing economy, the financial markets are beginning to think about the likelihood of inflation again," said Frank Nothaft, Freddie Mac chief economist.

"Although economic indicators thus far suggest March was an outstanding month, we still have to see how April will fare, especially with higher—although still moderate—interest rates," Nothaft added.

more...

[UpInArms]

53. Market Numbers at 1:22 EST and blather

Dow 10,374.97 -2.98 (-0.03%)
Nasdaq 2,002.34 -22.51 (-1.11%)
S&P 500 1,126.22 -1.95 (-0.17%)
10-Yr Bond 4.366% -0.016

1:00PM: In its decline, the Nasdaq tested the psychologically important 2000 mark, but was able to bounce off it... The tech composite's ability to do so served as a virtual break-pedal for the broader market, which has similarly bounced off its session lows... The Nasdaq's failure to stay above the 2000 mark would likely incite additional selling pressure in the broader market...

While the blue-chip averages are staying within only a short distance of the unchanged mark, with the Dow in positive territory, note that the banking sector continues to struggle in the face of rising interest rates and is among today's most notable laggards... Given the influential role that the banking group plays in determining market direction, its lagging stance is likely to limit gains in the blue-chip averages...NYSE Adv/Dec 1540/1672, Nasdaq Adv/Dec 1105/1981

[54anickel]

57. Within 20 pennies at 1:48

Dow 10,367.94 -10.01 (-0.10%)
Nasdaq 2,000.20 -24.65 (-1.22%)
S&P 500 1,125.97 -2.20 (-0.20%)
30-yr Bond 5.166% -0.003

NYSE Volume 954,061,000
Nasdaq Volume 1,217,770,000

1:30PM: The Nasdaq is probing the 2000 mark, while the S&P 500 and the Dow are slipping toward their worst levels of the session... The Dow continues to outperform the S&P 500 and the Nasdaq on a relative basis, with only 10 of its 30 components in the green... Among the laggards of note are Citigroup (C 49.73 -1.22), Intel (INTC 26.65 -0.72), and United Technologies (UTX 87.40 -0.77)... C is lower despite beating the consensus by $0.03 with its Q1 EPS of $0.98, reported this morning (see Briefing.com's Earnings Briefing for more perspective)...
Leaders to the plus-side include drug companies Johnson & Johnson (JNJ 54.26 +1.66), Merck (MRK 47.06 +1.62), and Pfizer (PFE 37.25 +1.44)...NYSE Adv/Dec 1553/1682, Nasdaq Adv/Dec 1106/2009

[54anickel]

59. Stop-losses kicking in yet?

Dow 10,365.75 -12.20 (-0.12%)
Nasdaq 1,998.01 -26.84 (-1.33%)
S&P 500 1,125.49 -2.68 (-0.24%)
30-yr Bond 5.162% -0.007


Oh yeah, with each hit of the refresh button.

Nasdaq 1,997.58 -27.27 (-1.35%

[KoKo]

65. OMG.....this should be interesting. How will it be handled......is the

question. :-(

[54anickel]

67. Plenty of time left to go in the day - but will anyone come to the

rescue today? Any "bargain hunters" out there to step in again during the last hour? :evilgrin:

[UpInArms]

55. The Daily Reckoning

Too good to be good.


That was the problem with yesterday's financial news. So
many corporations, for example, reported earnings 'greater
than expected,' it was almost as if they planned it that
way.

We explained a day or two ago how consumer spending seemed
to have topped out. Would you hold that item, dear reader?
We will use it later.

But yesterday's news brought more evidence that the
consumer was still ruining himself - faster than ever.
Retail sales rose 1.8% in March. The poor lumpen consumer
had no more money to spend - his wages had not gone up, his
costs had not gone down - but he spent it anyway.

Where did the money come from? Thank the feds. Like
sneaking whiskey into a rehab center, the Fed keeps plying
consumers with the one thing they cannot resist: free
money.

The Fed's key lending rate is 1% - well below the actual
level of consumer price inflation. This is an "emergency"
level, we've been told. But as for what the emergency is,
the feds keep that to themselves.

Reading the news, we see no emergency at all. Life goes on
as always. People borrow. People spend. People go further
into debt.

It has to come to an end sometime. We don't know when. What
we do know is that it didn't come to an end in March.
Instead, the fantasy economy became even more fantastic.

In San Diego, house prices rose more than 16% over a year
ago. In LA they were up an incredible 29%. Even in the
Baltimore area, the median house sold for 20% more in March
than it had a year ago.

This is great news, of course. It means your editor can
borrow more money against his house. He is not sure how he
will answer the "use of funds" question... or even if the
question is still posed to prospective borrowers. But the
lure of taking out equity - that is, spending money you
never earned - is so strong, he is sure he can think of
something.

Alas, good fortune is self-correcting. Yesterday's news was
so good, investors were spooked by it. "Now the Fed will
have no choice," they said to themselves. "They'll have to
raise interest rates... before the election, not after."

The morbid specter of higher rates dropped upon Wall Street
like an exhausted zombie. Stocks fell. Gold fell. Bonds
fell. Only the dollar rose - in anticipation of higher
yields from U.S. dollar holdings.

Isn't it fascinating, dear reader? We mean, the way
everything works. Things seem to get better... but only as
long as people fear they are getting worse. Then, when the
betterness is undeniable... they suddenly get worse. And
then it looks as though they were right all along!

No, consumer spending didn't head down in March as we
thought it might. Nor did the dollar end its rally. But
hold these thoughts, dear reader; we may need them soon.

[UpInArms]

61. bond market only thing up at 2:00 EST

Dow 10,357.22 -20.73 (-0.20%)
Nasdaq 1,994.69 -30.16 (-1.49%)
S&P 500 1,124.33 -3.84 (-0.34%)
10-Yr Bond 4.376% -0.006

Dollar numbers

Last trade 90.20 Change -0.04 (-0.04%)

[54anickel]

64. Nasdaq seems to be dropping rather quickly - 2:12 all following suit

Dow 10,323.36 -54.59 (-0.53%)
Nasdaq 1,989.45 -35.40 (-1.75%)
S&P 500 1,120.85 -7.32 (-0.65%)
30-yr Bond 5.181% +0.012

[JNelson6563]

66. 2:21 and still dropping

Hi Everybody! :hi:

Well it's getting a tad uglier.


Dow 10,338.85 -39.10 (-0.38%)
Nasdaq 1,992.79 -32.06 (-1.58%)
S&P 500 1,122.45 -5.72 (-0.51%)
10-Yr Bond 4.396% +0.014

Blood everywhere, even Treasuries. Ugh.

Hope everyone weather's the storm ok.

Julie

[54anickel]

69. Splash of blather to go with that shot?

2:00PM: After sitting at the 2000 mark for the past hour, the Nasdaq has slipped below the psychologically significant level, inciting added selling pressure in the broader market... The semiconductor sector continues to spearhead the feat lower, with the SOX index down 3.5%... Among the weakest components in the group are National Semi (NSM 44.76 -2.21), Xilinx (XLNX 37.43 -2.15), and KLA Tencor (KLAC 50.76 -1.38)... Breadth figures on the Nasdaq are dreadful, with decliners leading advancers by a 2-to-1 margin and down volume outpacing up volume by a 3-to-1 degree...
There are currently 56 new highs on the Nasdaq versus 24 new lows...NYSE Adv/Dec 1582/1684, Nasdaq Adv/Dec 1087/2039

[KoKo]

71. What's interesting about this drop is that "safety" seems to be upticking.

I have my little "basket" of stocks I watch. My Nasdaq bloated tech/trader stock is holding and not being challenged by this downturn,which seems very peculiar because it should have tumbled.

And my very safe Fortune 500 drug stock which tanked in the last challenges we've had, went up five points.

This is a very odd picture I'm getting, here. Not like the last three times the market has been challenged recently. :shrug: Ive been watching these two stocks for years, and this behavior signals to me that something different is going on in this latest drop. A different pattern is emerging...

[54anickel]

72. Do you ever wonder......

why they never mention the idea of a rising dollar squeezing multi-nationals profits? They were blathering all over the place how a lower dollar helps their bottom line. Now it seems to just focus on a rate hike. :shrug:

[KoKo]

74. And, rising dollar should hurt the flight to safty in the international

drug stocks. Why would the drugs be up today given that they tend to do better when the dollar falls and yet they've been languishing over the last two years. The drugs were always considered "safety" and the market would move into them when the Nasdaq had a problem in the past (before Bush). All of a sudden the markets are falling and we now for the first time in three years have the old "return to safety" pattern emerging. It has to be saftey because the dollar rise should have the drugs even or down. :shrug:

Stranger and stranger. Where are those little pills that Alice took that made her grow taller and then shorter? :crazy:

[54anickel]

76. Here's What I See: When in Doubt, Stay Out

http://www.kitco.com/ind/GoldReport/apr142004.html

snip>

I've said that my own basic position is in cash and gold (two-thirds coins, one third gold stocks). My reason for this position – the old adage, "When in doubt, stay out."

I didn't like this wildly-overvalued stock market, I didn't like the fact that everybody was "unfriendly" to the dollar and was on the other side of the equation (meaning they were in foreign currencies). As far as the universe of gold, I don't trade it, I sit with it. As for bonds, I haven't liked bonds for months or longer – not with the Fed hell-bent to inflate. And inflate they are doing – nonstop.

As for the big picture, I believe the government has about "shot its load." Look what's happened over the last 12 months, and still the major stock averages have been unable to rise to new highs.

- Eleven rate reductions taking short rates down to a Great Depression level of 1%.

- Massive refinancing of home mortgages to the tune of $2.5 trillion in 2003.

- Fed injecting over a trillion dollars in liquidity into the banking system over the last 12 months. Over the last four weeks we've seen M-3 rise $100 billion or at an annualized rate of over $1 trillion.

- Massive foreign buying of US Treasuries, which has (up to now) kept long rates down.

- Series of tax cuts by the Bush administration.

- Weekly "happy news" propaganda from various Fed governors.


- Huge government deficits which tend to stimulate the economy.

- All-out spending spree by US consumers.


So what the Fed and the US government have done is to build the greatest edifice of debt ever seen by one country in history. And this debt continues to build. For the US government, the debt build-up is continuing at the rate of over $13 billion a WEEK. The current rising trend in interest rates will bear down on this ocean of debt.

snip>

And in the end, what I've warned about all along will come to pass. "In a bear market everyone loses, and the winner is the one who loses the least."

[UpInArms]

79. ahhh, yes, that debt thingie

The estimated population of the United States is 293,805,116
so each citizen's share of this debt is $24,420.00.

The National Debt has continued to increase an average of $1.98 billion per day since September 30, 2003

[54anickel]

78. 3:04 and the calvary has arrived?

Dow 10,381.14 +3.19 (+0.03%)
Nasdaq 2,002.35 -22.50 (-1.11%)
S&P 500 1,127.11 -1.06 (-0.09%)
30-yr Bond 5.185% +0.016

NYSE Volume 1,221,536,000
Nasdaq Volume 1,542,984,000

[UpInArms]

81. all red at 3:19 EST

Dow 10,365.46 -12.49 (-0.12%)
Nasdaq 1,999.22 -25.63 (-1.27%)
S&P 500 1,125.88 -2.29 (-0.20%)
10-Yr Bond 4.402% +0.020

dollar

Last trade 90.05 Change -0.19 (-0.21%)

and a side of blather:

2:30PM: As expected, the Nasdaq's failure at the psychologically significant 2000 mark has incited added selling pressure in the broader market... Accordingly, like the Nasdaq, the blue-chip averages have slipped to fresh session lows and are showing mild losses at this juncture... The Nasdaq, for its part, is down 1.6%... Today's volume totals are a bit heavier than the levels seen over the past two days, which is to say that they're moderate... As mentioned previously, breadth figures on the Nasdaq are quite uninspiring...

On the NYSE, decliners and down volume are leading advancers and up volume by only a slight degree... Note, however, that there are currently 58 new 52-week highs versus 103 new lows on the NYSE...NYSE Adv/Dec 1426/1844, Nasdaq Adv/Dec 907/2227

[UpInArms]

82. calvary officially checked in at 3:35 EST

Dow 10,401.08 +23.13 (+0.22%)
Nasdaq 2,006.55 -18.30 (-0.90%)
S&P 500 1,129.20 +1.03 (+0.09%)
10-Yr Bond 4.402% +0.020

3:30PM: With half an hour of trade remaining, the blue-chip averages have lifted into the green, while the Nasdaq is sitting right at the psychologically significant 2000 mark and is underperforming the S&P 500 and the Dow on a relative basis... Supporting the blue-chip indices' relative outperformance are the gold and oil services sectors... The latter is up 2.0%, as indicated by the OSX index...

The group's advance coincides with gains in the price of crude oil, which is up $0.84 at $37.56/bbl on concern that the U.S. inventories of gasoline and heating oil are insufficient to meet the summer demand... The gold sector is higher despite a $2.20 decrease in the price of gold to $398.30/oz... Gold futures had their biggest decline since 1993 after signs of a stronger U.S. economy boosted the dollar, making the precious metal more expensive for overseas buyers...NYSE Adv/Dec 1581/1720, Nasdaq Adv/Dec 1132/2053

3:00PM: The latest dip to fresh session lows has been used as a buying opportunity, with the Nasdaq reaching toward the psychologically significant 2000 mark... While the market clearly doesn't trade in patters, it's worth keeping in mind that over the past several sessions the major averages had come under severe selling pressure in the last hour of trading... Separately, earnings reports will continue to roll in, with today's being the heaviest reporting day of the week... After the close, look for reports from IBM, CREE, DCLK, KOPN, LEXR, NFLX, PMCS, SEBL, and SUNW...

[KoKo]

83. Well, those traders have to make a buck one way or the other...

:D

[54anickel]

85. Closing numbers & blather -

Sorry about disappearing - had to drop everything for an errand.

Dow 10,397.46 +19.51 (+0.19%)
Nasdaq 2,002.17 -22.68 (-1.12%)
S&P 500 1,128.84 +0.67 (+0.06%)
30-yr Bond 5.205% +0.036

NYSE Volume 1,562,335,000
Nasdaq Volume 1,983,065,000

Close: Participants were grabbing at straws through the entirety of today's session, as they continued to reassess the risks associated with the rising interest rates and the benefits of a clearly accelerating economy... Accordingly, the early optimism over the generally better than expected earnings reports was short-lived and the major averages spent much of the morning trending lower, with the Nasdaq spearheading the decline and dipping below its 50-day simple and exponential moving averages at 2013 and 2015, respectively...
The semiconductor sector led the decline of the tech-composite, which was striking in the face of a batch of better than expected earnings reports from the likes of AMD, LRCX, CY, and FCS... The broader market experienced added selling pressure when the Nasdaq dipped below the psychologically significant 2000 mark... Yet, the tech composite's ability to lift above the 2000-mark incited buying in the blue-chip averages, which ended up lifting into positive territory and closing in the green, while the Nasdaq also closed well off its session lows...

Hence, technical levels proved to be just as significant of market movers in today's session, as readjustments for the higher interest rate environment... Among the leaders to the upside were the real estate operations, drug, gold, oil services, and coal groups... Laggards of note included the internet, networking, semiconductor, software, telecom, storage, insurance, retail, and iron & steel sectors... This morning's economic reports were mixed... The Initial Claims for the week of 4/10 checked in at 360K (consensus 335K), although the higher than expected reading could prove to be an aberration....


Ha, funny! Didn't hear anything about a possible aberration with last months jobs numbers! So, seemingly bad numbers are probably an aberration while out of this world most excellent numbers are Gospel.


edit to add -
Good thing for that closing bell by the looks of the futures right now. Maybe they'll head up by morning.