STOCK MARKET WATCH, Tuesday 8 June

[ozymandius]

Tuesday June 8, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 230
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 179 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 232 DAYS
WHERE ARE SADDAM'S WMD? - DAY 446
DAYS SINCE ENRON COLLAPSE = 929
Number of Enron Execs in handcuffs = 18
Recent Acquisitions: Jeff 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 June 7, 2004

Dow... 10,391.08 +148.26 (+1.45%)
Nasdaq... 2,020.62 +42.00 (+2.12%)
S&P 500... 1,140.42 +17.92 (+1.60%)
10-Yr Bond... 4.77% -0.01 (-0.19%)
Gold future... 394.50 +2.80 (+0.71%)


|||


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 88.20 Change -0.05 (-0.06%)

http://www.fxstreet.com/nou/noticies/afx/noticia.asp?pv_noticia=1086614500-9e32d306-24249

Dollar plummets vs. yen after Japanese stocks rally

CHICAGO (AFX) -- The dollar plummeted nearly 1.5 percent against the yen Monday, with the Japanese currency rallying after the Nikkei 225 Stock Average had its largest jump this year. The greenback was down 1.4 percent against the yen, at 109.66 per dollar. The dollar's slump against the yen came as Japan's benchmark stock index closed at a one-month high. In other currency action, the dollar fell 0.3 percent against the euro to $1.2326

...very little more...

http://news.moneycentral.msn.com/breaking/breakingnewsarticle.asp?feed=OBR&Date=20040608&ID=3777726

Dollar Hovers at Lower Levels

LONDON (Reuters) - The dollar hit a two-month low on the euro and hovered near a one-week trough on the yen with investors doubting whether the Federal Reserve would hike interest rates aggressively this month.

The market was waiting to see what Federal Reserve Chairman Alan Greenspan might say at a conference in London later in the session to confirm or alter this view.

Investors broadly expect the Fed to raise interest rates by a quarter point from 1.0 percent when it meets at the end of the month, fulfilling a pledge for a ``measured'' pace of tightening rather than making a more aggressive 50 basis point hike.

``The market needs to be surprised by the Fed in terms of how aggressively they raise rates. At present it's not likely they will raise by 50 basis points,'' said Steven Pearson, chief currency strategist at Halifax Bank of Scotland Treasury Services.

``The dollar is also under pressure as people put reflation trades back on -- buying Asia and commodity currencies.''

The dollar fell to a two-month low of $1.2351 per euro from $1.2310 in late New York on Monday, before edging back to $1.2330 by 5:55 a.m. EDT.

Its descent began on Friday as U.S. jobs data left doubts as to whether the Fed would be more aggressive and make returns on dollar-denominated assets more attractive.

<snip>

``Given that we have a pick up in employment, an implied slowdown in productivity and a rise in inflation, what Greenspan needs to do now is suggest that this is not a worry. But what he says today will be hostage to inflation numbers later.''

Producer prices data will be released on Thursday instead of Friday, as government offices will be closed for the state funeral of former President Ronald Reagan. Consumer prices are due the following Tuesday, as scheduled, but trade data has been put off from Friday to Monday.

...more...

http://www.chicagotribune.com/business/chi-0406080050jun08,1,5375950.story?coll=chi-business-hed

Consumer borrowing slows to a 2.3% increase in April

WASHINGTON -- Americans pulled back on credit card spending in April, the Federal Reserve reported Monday, as consumer credit rose at a seasonally adjusted annual rate of 2.3 percent, or $3.91 billion.

Consumers borrowed more freely in March, adding to their debt by nearly $9.3 billion, a sizable 5.5 percent increase. That was stronger even than the Fed's original estimate of a month ago.

Even with the slowdown in April borrowing, the increase for the month pushed outstanding consumer credit to a record $2.031 trillion.

"Consumer spending continues to be healthy," said Christopher Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi in New York. "Car sales went through the roof in May."

Cars and light trucks sold at an annual rate of 16.4 million in April, close to the 16.7 million in March, according to industry figures. Vehicle sales climbed to 17.8 million in May.

The Fed's report includes credit card debt and loans for such commodities as boats, cars and mobile homes. It does not include home mortgages or popular home-equity loans.

In April, credit card and other revolving credit dropped 5.1 percent, or by $3.21 billion. That compared with a $3.75 billion increase in March, a brisk 6 percent growth rate.

The decline in revolving credit marked the biggest drop since December 2002.

"Consumers were spooked by skyrocketing energy and food prices, and decided to keep their credit cards in their pocketbooks and wallets," said Richard Yamarone, economist at Argus Research Corp.

...more...

My computer was down more than it was up yesterday - so I missed most of the action - and boy oh boy, did the market have a great time! Guess it loves the funeral procession of RayGun :D

Have a Great Day Marketeers!

[UpInArms]

2. interesting article on young workers and the 401(k) plans

http://www.cincypost.com/2004/06/08/money060804.html

On autopilot
Many young workers shirk 401(k), so industry pushes automatic plans

Tracy Yen's opinion of 401(k) plans soured when she was laid off from her first job and learned she hadn't been with the company long enough to keep the matching funds her employer had contributed to the plan.

"All that time I was thinking I had this much money, when all that time I didn't," she recalled. "I didn't understand what vesting was until that point."

The experience led the 28-year-old Oakland, Calif., woman to decide not to participate in the 401(k) plan at her next job.

That put her in the middle of a large group of young workers ignoring the chorus of financial planners who tout the employer- sponsored retirement plans as their best chance of enjoying a comfortable retirement.

Financial service firms have tried diligently to reach the younger generation and explain that choosing not to participate can mean turning down thousands of dollars in matching funds from their companies -- money that could grow exponentially by the time they retire.

Young workers give a variety of reasons for not participating.

A recent survey by Cigna Retirement & Investment Services found almost half of respondents 25 and younger said their opinion regarding savings had been influenced by global political instability and corporate corruption. Only about a quarter of baby boomers had the same response.

According to other studies and experts, some young workers don't see far- off retirement needs as urgent because they need every dollar they earn to pay living expenses or to save for houses or cars. Some don't stay in the same job long enough to qualify, while others, like Yen, simply are not educated enough about the workings of the plans.

"The 401(k) is an experiment, and it's successful outcome is in doubt," said Wayne Gates, general director of market research and development at John Hancock Financial Services, Inc. "Education isn't working. We need to change the way the plan is designed and operates."

...more...

[Redhead488]

6. Never underestimate

the ignorance or carelessness of the average American worker.

"All that time I was thinking I had this much money, when all that time I didn't," she recalled. "I didn't understand what vesting was until that point."

FIND OUT! It's part of your benefits! It's YOUR retirement. I'm amazed at this nonchalant attitude expressed by some many young workers. It's simply appalling.

[54anickel]

7. WTF? The idea is failing to catch on so they are going to "mandate"

participation by automating it? Can an employer legally set up a contribution percentage? I mean, isn't that YOUR money and YOUR raise?

I can see automating the enrollment. My former employer did not do that but did strongly encourage new workers to enroll, even if they did not make any contributions. Main part of the reason was that any profit sharing was paid directly to the 401K accounts - you needed to have one if you were going to get part of that profit sharing.

Back in the good old days when it was a great company to work for (before they brought in a lot of new management with the big corporation mentality - but I'm not bitter) and those profit sharing bonuses were a pretty healthy chunk of change.

[Redhead488]

8. Why not?

The Govt mandates that you contribute to FICA--at least the young workers will see the money in their 401k. Unless something changes, they won't get a cent of the ~6% they are putting into FICA.

Sarcasm off

[UpInArms]

11. Welcome to DU (and the SMW) Redhead488!

We're glad to have you here! :hi:

Mandated participation in 401(k)s does appear to be yet another way to have an "involuntary tax" on earnings.

Since the worker really has no control of what investments the fund managers do, and real return on money is not guaranteed (just look at what has happened in the past few years), I believe that the worker should not be forced to participate.

Enron is a very good example of misconduct of investments.

[Redhead488]

12. Still, though

in MANY cases, the employee may be throwing away "free money." My company matches 5% of employee salary (up to $3,500) with just 1% participation from the employee. That is a GREAT deal. And we do get control of where our investments go. We use Fidelity.

I agree, though, that no worker should be forced. They ought to be educated though.

Let's be fair; Enron is one example of what can go wrong when crooks run a company. 99% of companies aren't like Enron.

[54anickel]

21. Control of where your investments go with Fidelity -

Isn't your control limited to specific "funds" offered by Fidelity? You cannot pick and choose individual investment options, can you? (individual stocks, gov't bonds, corporate bonds, foreign stocks, currencies, etc)

[Redhead488]

49. Yes, we can

to some extent. Fidelity's option range is HUGE.

[Frodo]

9. There's another reason why they want to mandate it.

Sure, it's the right thing to do. With the exception of the "vesting" issue, young employees who think they can't "afford" to participate actually can't afford NOT to.


But there's a bigger reason. Did you know that the amount "highly compensated" employees can contribute is largely determined by how many lower paid employeed participate? That your company may allow, say.. 6% to go to the 401(k) but senior management may be limited to 3% or 4% because not enough employees participate in the program?


Edit - Oh, and of course somebody makes a profit off the extra investments (the plan administrator).

But it's still a good idea. Too many people put off savings whent hey are young and it KILLS their finances later. Ric Edelman "wrote" a book a few years ago called "ordinary people, extraordinary wealth" kind of like "the Millionaire Next Door". I say "wrote" because 90% of the book was just quotes from his clients. A chapter on how they did their budgets, a chapter on wat they did right, a chapter on picking investments/advisors.

The interesting one for today's point was the chapter on "what was your biggest mistake - what would you do differently if you had to do it again". 75% of the responses (my estimate without having read it in over a year) were "I didn't start saving early enough".

[Redhead488]

10. What dollar amount

distinguishes a highly paid employee? And where can I find info on what you just posted.

[Frodo]

13. It varies

When I last looked, the limit was very close to the Social Security tax cutoff (say $80,000), but I don't think they were tied together.

Alternatively, the company can define it as the "top 20%" of the employees. This would be more legitimate in a professional environemnt where 80k may not be all that much money (Oh, where to find such a place for me?)

I think there is also something about owning more than 5% of the company, but that would only matter in pretty small comapnies (if you own more than 5% of a publicly traded firm, your salary is going to exceed the 80k)

[Redhead488]

14. Can you provide a link so I can read up on this?

Thanks!!

[Frodo]

16. Gotta run to a meeting.

Try googling "highly compensated" and "401(k)". I'm sure there are plenty of links.

Alternatively, I use Fidelity for brokerage as well, I know they run a site called www.401k.com that is bound to have definitions.


Good luck.

[Redhead488]

18. Thanks!

Found some good info!

[54anickel]

17. A quick google of "401K highly compensated" gave me this one -

http://www.401khelpcenter.com/mpower/feature_030702.html

[Redhead488]

19. Read that too! Thanks!

[54anickel]

15. Right, and that was the reason my former company went to putting

the profit sharing carrot into the 401Ks - it was a Christmas bonus before we had 401Ks implemented. So, it was more of a win-win situation for the participants. And many of the younger workers did eventually start to contribute a small percentage of their pay to the plans.

If a company wants a larger number of participants from the rank & file, they should make it more attractive to participate, whether that be shorted vesting periods, matching contributions, immediate eligibility for enrollment or whatever. That was part of the reason for the rule you brought up regarding the highly compensated. By allowing companies to automate/mandate participation, they've taken away the push to "entice" participation. It becomes yet another "tax" now levied by the Employer, NOT the government.

Personally, I think it (automating participation) sucks.

edit to clarify what I think sucks. B-)

[54anickel]

3. Here's a theory on the recent jump in the money supply.

Or maybe it's just getting ready for when this mal-admin implodes at the direction of God the almighty himself thru Shrubs "erratic behavior" that's been discussed in another thread here. :evilgrin:


http://www.gold-eagle.com/editorials_04/ekervik060704.html

Where is the horror?

In recent weeks I as many other financial writers have noticed the extreme M3 expansion by the FED. The size of expansion is what would follow after a catastrophic event that could threaten the financial system like the WTC attacks or the failure of LTCM. What kind of horror forces the FED to hyper inflate M3? I believe this is the most important question at the moment.

Some writers try to explain that the FED is hyper inflating to counteract the underlying forces of global deflation. I agree that deflationary forces are like a wet blanket over the global economy. However we have had deflationary forces in the economy due to overinvestment/overcapacity since at least 2000. I am not satisfied with such a general explanation to this last month sudden super growth in M3. I think there is a more specific reason for the FED´s action!

OK, what kind of horror has got the FED spooked? They must know something since they are acting before the event has become public. I think the FED has told us about the horror they now expect/experience several times the last two years. Here are some clues for you! Alan Greenspan touched the issue in Feb 2002 and warned us again in Feb 2004. William Poole president of the St Louis FED made a publicized in depth analysis on the "problem" in May 2004.

I will soon reveal what I think the FED is scared of. But first lets try to see if we can figure out where all the money is going.

more...

[UpInArms]

4. very interesting Ah-lee

Mr Poole: "I note also that FF have a powerful incentive to grow. They report returns on equity in the neighborhood of 30 percent per year. They are able to achieve these returns by exploiting the implicit federal guarantee of their obligations, which enables them to borrow at near Treasury rates despite their thin capital positions and invest in mortgages at private market rates. Their growth objectives insure that their scale will increase over time, unless they become subject to full private market incentives through convincing federal policies that lead to market recognition that the federal government will not guarantee GSE obligations in a crisis."

sounds a lot like a ponzi scheme to me :D

[ozymandius]

5. WrapUp by Jim Willie CB

US FINANCIALS AS AN ADDICTION SYSTEM

The financial nerve centers of the United States, its capital flows, leveraged engineering, risk management, widespread perception, retail promotion, institutional relationships, and public participation, these have degraded to an incredible extent since 1971, the time of the Bretton Woods Divorce. When false money is permitted to behave as real, the consequence has tended to expand both debt and gambling, which results in more frequent booms and busts. Loose claims abound that the largest economy in the world resembles a bubble economy whose engines are powered by inflation and debt, and whose debt dependence has grown out of control. One can make a compelling argument that various elements of the US Economy display clear evidence of an addiction manifestation. Such is too large a claim to defend here, so focus will be given to the financial side of the claim.

-cut-

First, an argument will be presented to demonstrate the parallels of our financial structures to the gambling casino. Several key addiction components will be analyzed. Their betting vehicles can be easily identified. The breadth of comparison with intoxicating mood-altering drugs is somewhat disconcerting. The punch bowl metaphor is commonly used, as is the spiking of that bowl by the Fed. Our banking institutions provide ample supplies of easy money, available in credit, taken as debt. The system depends upon liberal credit terms. Lately, concern abounds as to whether withdrawal will be severe, since the easy money drug must be allowed to wear off. Or will it at all ?!? Accommodation might become a permanent fixture to the financial landscape. Debt and available credit are omnipresent in our economy and in our society. It is my opinion that new innovative credit devices will be offered in coming months, such as reverse mortgages. Progression in the debt addiction continues on many levels.

-cut-

The most prominent gambling tables are stocks and bonds in the financial markets. Step past these to the back rooms, and one will find options, futures, swaps, spreads, and all manner of exotic gambling vehicles. These games make craps, blackjack, and roulette seem quite tame and boring. New games are being invented every year. Why just last week, a Fanny Mae balance sheet management tool was revealed to me, in the form of a swaption, which is an interest rate swap option. Short-term trades do not qualify as investment in a true sense, but rather gambles. The language even mimics the gambling vernacular, with hedged bets, handicapping on Fed rate decisions, putting money on the table during earnings season, positioning before economic news release, over-unders on jobs reports, and so on. The pyramid of the MGM Grand in Las Vegas has a parallel in the giant $100 trillion derivative pyramid which rests inverted and balanced atop our national financial system. Its shadow casts a dreadful specter over both the markets and the economy. As the financial sector rises in weight as a component to the overall economy, the real economy has diminished. Like a cancer, the credit business and speculative trade with their many financial services have encroached upon the real economy. The real estate boom is powered within this bond machinery. It offers a vital link between the bond market and the Main Street shopping markets. That real portion of the economy actually designs things, builds things, repairs things, and maintains things. A case in point is General Motors, whose profits come from mortgage origination and car loans more than from building cars.

-cut-

RONALD REAGAN REMEMBERED

-cut-
Reagan presided over two key developments. The federal deficit expanded from $2 trillion to $4 trillion under the dual effect of huge defense budgets and expansive tax cuts, in order to deal with a stubborn recession, which lasted over two years. Some believe that while the Soviet “Evil Empire” folded, the USA suffered a Pyrrhic Victory, badly wounded by debt that plagues us to this day. Tax reduction and regulatory relief did aid the economic recovery, but its success is exaggerated. The “trickle down” supply side economics has been discredited as not producing the anticipated business investment expansion. While over 19 million new jobs were created, a squeeze continued for the middle class, which required two household jobs and withstood rising debt burdens.

more...

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

[54anickel]

20. Ozy, did you catch yesterday's blather - Fond memories of the

Raygun era were credited for yesterdays rally. I don't know about you, but "hubby" has no fond memories of that era - says they were some of the worst years of his professional/economic life. Then again, he's a union man.

[ozymandius]

22. Selling nostalgic toothpaste

I remember the Reagan era too well. Reagan spanned my high school and college years. It was a formative political era for me in that I saw Reagan and Edwin Meese attempt to stomp on our civil liberties with their pronography witchhunts (bleeding onto mainstream First Amendment freedoms) and the War on Drugs. 1987 was a watershed year with Oliver North reaping the fruits of his criminal labor.

This was the only time that I recall reporters being criticized for "irreverence". Sheesh! To think that some people believe that reporters should be reverent!

Of great relish was the lampooned "tinkle-down" Reaganomics. Or as the elder Bush said, "voodoo economics".

[54anickel]

24. Remember the Simply Red song - "Money's Too Tight to Mention"

I been laid off from work
My rent is due
My kids all need
Brand new shoes

So I went to the bank
To see what they could do
They said son - looks like bad luck
Got-a hold on you


Money's too tight to mention
I can't get an un-em-ploy-ment ex-ten-sion
Money's too tight to mention

I went to my brother
To see what he could do -
He said bro-ther like to help you
But I'm unable to
So I called on my fa-ther fa-ther
Oh my fa-ther
He said


Money's too tight to mention
Oh mo-ney mo-ney mo-ney mon-ey
Mo-ney's too tight to mention
I can't even qual-i-fy for my pension

We talk a-bout rea-gan-on-ics
Oh lord down in the con-gress
They're passing all kinds - of bills
From down cap-it-ol hill - (we've tried them)


Money's too tight to mention
cut-back!
Mo-ney mo-ney mo-ney mon-ey
We're talk-in' a-bout mon-ey mon-ey
We're talk-in' a-bout mon-ey mon-ey
We're talk-in' 'bout the dollar bill
Now what are we all to do
When the mon-ey's got a hold on you?
Mo-ney's too tight to mention
Oh mon-ey mon-ey mon-ey mon-ey
Mo-ney's too tight to mention
A-mero - mon-ey oh yeah
We're talk-in' a-bout mon-ey mon-ey
We're talk-in' a-bout mon-ey mon-ey
We're talk-in' a-bout mon-ey mon-ey
We're talk-in' a-bout mon-ey mon-ey:..

[ozymandius]

29. I am living it.

That song came to mind this past week when the last paycheck I received was gone almost as soon as it graced my palm. (Notice my donor star has not returned. Soon, my friends. Soon.)

Now that I have completed the last big project, my woodshop is shutting down. Some shop equipment is selling today. That will keep my son in shoes for awhile longer.

[UpInArms]

30. my "star" was missing for

over a year - I got paid for one of my writings (does that make me "real"?) and got my "star" back.

What a long strange ride it has been :(

[UpInArms]

23. Markets open at 9:37 EST

Dow 10,365.88 -25.20 (-0.24%)
Nasdaq 2,010.63 -9.99 (-0.49%)
S&P 500 1,136.68 -3.74 (-0.33%)
10-Yr Bond 4.783% +0.018

[54anickel]

25. Dang, forgot to post the futures yada before the open - better late than

never - Looks like it's a new day. Enough of those warm fuzzies regarding the "good old Raygun days".

9:00AM: S&P futures vs fair value: -1.5. Nasdaq futures vs fair value: -4.5. Expectations remain set for a lower open in the cash market, as futures indications continue to trade below fair value. Buyers are hesitant ahead of Fed Chairman Greenspan's address at the International Monetary Conference and the G-8 meeting. Also contributing to the negative bias is the higher price of crude oil. Technology sectors are looking to underperform the broader market, with worse than expected earnings from TTWO and disappointing guidance by CYMI cooling buying interest.

8:25AM: S&P futures vs fair value: -1.6. Nasdaq futures vs fair value: -4.5. Futures indications slip slightly and continue to point to a lower open for the cash market. There are no economic reports today, but the market has Chairman Greenspan's address at the International Monetary Conference to look forward to. The G-8 summit is taking place today in Georgia and is another event worth keeping an eye on, especially since it has been suggested as one of potential opportunities for terrorist activity.

8:00AM: S&P futures vs fair value: -1.4. Nasdaq futures vs fair value: -3.5. The futures market is trading lower this morning on the heels of yesterday's sweeping gains of 1.5-2.1% and in the midst of mixed trade in overseas markets. Contributing to the slightly negative bias is the increase in the price of crude oil, which is higher on Iraq disruptions and the threat of a strike in Nigeria.

[ozymandius]

28. so much for Reagan nostalgia

However if the numbers continue to go down, it could be nostalgia for Reagan-era profit taking. Reemember: "greed is good".

[UpInArms]

26. Oil Up on Iraq Disruption, Nigeria Threat

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=5370180

LONDON (Reuters) - Oil prices made fresh gains on Tuesday after news of further disruption to Iraq's oil exports and the threat that a strike in Nigeria could disrupt its flows to a tight international market.

U.S. light crude for July (CLc1: Quote, Profile, Research) was up 24 cents at $38.90 a barrel, while in London, July Brent (LCOc1: Quote, Profile, Research) was up 29 cents to $36.25.

U.S. prices have dropped around 10 percent from 21-year highs above $42 a barrel as an increase in U.S. crude and gasoline stocks reported last week bolstered confidence in supplies for peak summer driving demand.

Even so, a lack of spare world oil supply capacity as producers pump flat out to meet strong demand has left traders nervous about any supply disruption that would further strain world oil flows.

Prices rose after a source at Iraq's state oil marketing organization said that attacks on Iraq's vital oil pipeline to Turkey have again halted crude flows, leaving Baghdad unable to sell Kirkuk oil for several more weeks.

Iraq's oil exports will be limited to some 1.65 million barrels per day (bpd) of Basra Light from its southern Gulf terminals until enough Kirkuk accumulates in storage tanks at the Turkish Mediterranean port of Ceyhan.

Nigeria's umbrella labor union is to hold last-minute talks with government officials late on Tuesday over a planned general strike protesting recent increases in gasoline prices, a union leader said.

...more...

It made my heart soar when I learned that we (the US taxpayer) were paying roughly $2 a gallon for Halliburton to truck gasoline into Iraq and selling it for 5 cents!

Knowing that we get to pay $2 (on average) here and there and subsidize the difference was just touching. /sarcasm off

[UpInArms]

27. Ford to Triple China Output to Chase GM

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=5369962

BEIJING (Reuters) - Ford aims to more than triple output in China this year, executives said on Tuesday, as it races to catch General Motors and other foreign auto makers in the world's fastest-growing major car market.

Ford Motor Co plans to make 65,000 units in the country in 2004, less than one percent of its global production and about a tenth of arch-rival General Motors Corp's output in China.

Rivals such as GM, Volkswagen AG and Toyota Motor Corp plan to spend about $13 billion to make some six million cars in coming years -- stoking fears of a glut and price war at a time when global car capacity is outstripping demand.

GM, the world's top auto maker, will spend $3 billion to double output in China to 1.3 million units by 2007. Rival Toyota aims to make up to 400,000 cars by 2010.

And with Beijing trying to gently cool its racing economy, some fear sales growth could slow to as little as 10 percent in 2004 after nearly doubling to two million units in 2003.

...more...

[UpInArms]

31. Greenspan Won't Rule Out Aggressive Moves

http://www.forbes.com/home/feeds/ap/2004/06/08/ap1401364.html

Federal Reserve Chairman Alan Greenspan suggested Tuesday that Fed policy-makers can boost now super-low interest rates gradually, but he didn't rule out more aggressive action to keep inflation at bay.

Although Greenspan repeated the Federal Open Market Committee's view that any upcoming rate increases would likely be at a very methodical pace, he said that assessment was made on Fed policy- makers' best judgment of how economic and financial forces will evolve in the months ahead.

"Should that judgment prove misplaced, however, the FOMC is prepared to do what is required to fulfill our obligations to achieve the maintenance of price stability so as to ensure maximum sustainable economic growth," Greenspan said in prepared remarks to an international monetary conference in London. He spoke via satellite.

The FOMC is the group that sets interest rate policy in the United States.

With the economy now on a firm growth path, economists widely expect Federal Reserve policy-makers on June 30 to raise a key short- term interest rate for the first time in four years. That rate is now at a 46-year low of 1 percent, where it has been since last June.

In his prepared remarks, Greenspan did not say what the Fed would do with interest rates at the June meeting. Most economists are expecting a quarter percentage point increase.

Now that the economy is growing solidly, some companies are finding it easier to raise prices, something that they were hard-pressed to do during the economic slump.

In the first four months of this year, consumer prices rose at an annual rate of 4.4 percent, compared with a 1.9 percent increase for all of last year. Core prices - excluding volatile food and energy - also picked up steam. So far this year, they went up at a rate of 3 percent, outpacing the 1.1 percent rise for 2003.

Meanwhile, labor costs, driven mostly by skyrocketing benefits costs, also are on the rise.

Fears of losing customers should dissuade businesses from fully passing along to consumers the higher labor, energy and other costs, Greenspan said.

"To date, the aforementioned costs pressures have been relatively subdued," he said. "Nonetheless, the persistence of the rise in energy prices is a worrisome element in the cost picture."

...more...

[ozymandius]

34. HA! This part of a related story made me laugh.

He (Greenspan) said the return of pricing power was also visible in accelerating core consumer prices, which strip out volatile food and energy costs.

Meaning: life's essentials are not considered in the overall economic picture. Heaven forbid we develop the ability to ingest DVD players.

[UpInArms]

36. no eating of DVDs, but we are being

encouraged to eat our homes.

[UpInArms]

32. Market Numbers at 10:01 EST and blather

Dow 10,360.49 -30.59 (-0.29%)
Nasdaq 2,011.59 -9.03 (-0.45%)
S&P 500 1,136.19 -4.23 (-0.37%)
10-Yr Bond 4.811% +0.046

9:45AM: Indices open a bit weaker than indicated by futures trading...Federal Reserve Chairman Greenspan made some comments this morning that have hurt the bond market...not really surprising, but he said the Fed will take measured moved, but "Should that judgment prove misplaced, however, the FOMC is prepared to do what is required to fulfill our obligations to achieve the maintenance of price stability so as to ensure maximum sustainable economic growth"...in other words, they will raise rates faster if necessary...he also noted energy price increases as worrisome...

[ozymandius]

33. Greenspan: Ready to Guard Price Stability

WASHINGTON (Reuters) - The Federal Reserve (news - web sites) will do "what is required" to keep inflation in check if it turns out the forecast behind its view that interest rates can rise gradually is wrong, Fed Chairman Alan Greenspan (news - web sites) said on Tuesday.

"The (Fed policy-making) committee is of the view ... that monetary policy accommodation can be removed at a pace that is likely to be measured," Greenspan said in remarks prepared for delivery by satellite to a conference of bankers in London.

"That conclusion is based on our current best judgment of how economic and financial forces will evolve in the months and quarters ahead," he said. "Should that judgment prove misplaced, however, the (committee) is prepared to do what is required to fulfill our obligations to achieve the maintenance of price stability so as to ensure maximum sustainable economic growth."

more...

[ozymandius]

35. Greenspan Speaks, Treasuries Slip

NEW YORK (Reuters) - U.S. Treasury debt prices retreated on Tuesday after Federal Reserve Chairman Alan Greenspan warned about the impact of higher energy costs and noted companies were regaining pricing power.

Greenspan repeated that the Fed could be measured in tightening but said this view was based on economic forecasts and if these proved wrong the central bank would act to ensure price stability.

short piece

[54anickel]

37. Hot Vegas

http://www.lewrockwell.com/french/french18.html

It was reported last week that the M3 money supply has increased at a breathtaking 20% annual rate in the last 4 weeks, going up $155 billion.

Coincidently (or not), the Bureau of Land Management (BLM) held another of its semi-annual land auctions in Las Vegas. With Alan Greenspan providing the juice and animal spirits aplenty in attendance, the BLM set new records both in terms of the total amount of land sold ($707,185,000 worth) and price per acre ($279,299). The total sales figure was more than double the $309,769,500 total appraised value of the parcels.

Please don’t get the idea that you will get a check in the mail once these sales close; government schools in Nevada will receive five percent of the loot, and the Southern Nevada Water Authority will receive 10 percent of the proceeds to continue convincing Las Vegas residents to stop using so much of its product. The remaining monies go to the Secretary of the Interior to buy environmentally sensitive land. So the government is not really selling land, but trading its land for other land.

snip>

Considering that these are homes built on land purchased a couple of years ago, builders in Las Vegas are reaping profit margins like they have never seen before. But will home prices grow to the sky? At the land prices paid last week, they will have to. However, median income grows at a snails pace, mortgage rates are increasing, and new supply is coming to the market. The number of listings for existing homes has doubled. The number of permits pulled for new homes is up over 58 percent from a year ago. Builders are on track to pull permits for 38,000 new homes in 2004. That is close to the number of permits pulled in the Phoenix metropolitan area, which has three times the population of the Las Vegas valley.

Just how long can it continue?

"There are three rules for bubbles," Jim Jubak wrote in The Daily Reckoning last week.

"Rule #1 is that they continue much longer than you expect.
"Rule #2 is that they expand faster near the end of the cycle... so just when you think they should have ended long ago, they seem more robust than ever.
"Rule #3 is that no one wants to admit when it's over."
The Las Vegas real estate market seems to personify Rule #2.

"It is difficult to predict how long bubbles will last and when they will go bust," economist Mark Thornton wrote on Mises.org. "The best indicator is interest rates, because when the Fed forces rates down it tends to create bubbles, and when rates are forced upward bubbles tend to pop."

Suffice it to say that when the real estate bubble does pop in Las Vegas, the pain will be felt by many; from the big developers who borrow millions gambling that home prices will continue to soar, to people like the couple who sat next to me at the auction, who moved to Vegas just to speculate on real estate.

There is talk that the BLM auction scheduled for next January will be moved to a larger venue and Las Vegas seems to be the talk of the nation, the city is "on a roll," as they say. But, any dice shooter will tell you that hot rolls don’t last forever. The market could "seven out" if mortgage rates continue to rise and bidders may want to stay in the casino and gamble rather than buying government land at inflated prices. However, that’s not likely, as Mr. Jubak says with his Rule #3, no one will want to admit when it’s over.

[htuttle]

39. I can't think of a worse place to build right now than Las Vegas

Except maybe Phoenix.

Both are probably going to be under water rationing all summer the way things are shaping up. Really stupid to put more people in the SW desert right now.

[Frodo]

56. Reminds me of a comedy sketch

From around the time of the Ethiopian famine (which was political anyway, but the joke was still pretty funny)


It was something like "You live in a @#@#$ desert! Food doesn't grow here! MOVE to the FOOD!

[htuttle]

57. That rings a bell

I think it might have been Sam Kinnison who did that bit.

[Frodo]

59. Yep -

Can't find the whole thing, but google turned up a piece...


YOU KNOW WHAT THIS IS... IT'S SAND.... NOTHING GROWS IN SAND, KNOW WHAT IT'LL BE IN A THOUSAND YEARS???? SAND YOU IDIOT!


Works pretty well for this situation I think.

[htuttle]

58. Duplicate (n/t)

[UpInArms]

38. gotta run away for a while

hopefully back later today

:hi:

[54anickel]

40. The rantings of Mogambo

http://www.dailyreckoning.com/home.cfm?loc=/body_headline.cfm&qs=id=3952

St Petersburg, Florida - Foreign central banks are still in there wasting their own citizens' money in vainly trying to prop up the ridiculous US dollar, and last week their Custody Holdings at the Federal Reserve ballooned up another $11 billion, bring their enormous stash of US Debt to the staggering sum of $1.21 trillion, of which $284 billion was bought in the last twelve months alone.

snip>

...Taking a look at the amount of selling of new Treasury debt, they are surprisingly constant, as far as putting us farther and farther into the hole is concerned, by consistently burying us under about $53 billion in new debt per month. It's almost a spooky linear thing.


snip>

Marshall Auerback, who spends his time at the Prudent Bear website thinking about the economic nightmare that we are in and randomly making sure that the door is locked so that the MoGu can't get inside and get his cooties all over the place, found that he still had enough time left over to write his latest essay entitled "Inflation Remains The Least Bad Option For The US." The first thing we notice is that he does not see any GOOD options for us. "For all of the talk of 'rising inflationary pressures', the real story of the 21st century thus far has been the vast explosion of debt on the heels of a historically unprecedented credit bubble. The efforts of U.S. policy makers to avoid a full unwinding of the 1990's stock market bubble through the encouragement of a credit bubble and a housing bubble has, despite something of a recovery, made both conditions worse, so there is no guarantee that an embrace of inflation, even if on the quiet, will achieve anything better than a 1970s style stagflationary outcome."

Steve Puetz of the Steve Puetz Letter is obviously thinking along the same lines, only he is not as sanguine, when he writes "Recognizing the formation of a bubble, central banks usually burst a bubble before it gets completely out of control. But the Fed has proved to be the exception. The Fed has let the multitude of bubbles form with complete indifference. The damage from a bubble is always in future years. Given the magnitude of the current bubbles, the damage will likely translate into a total collapse of the US financial system. In short, any economy based on ever-expanding credit is doomed in the long-term. The size of the bubble dictates the following pain. Judging by the current bubbles, the coming pain will be unprecedented. The Great Depression of the 1930s will be mild in comparison."

- Robert McHugh of Safe Haven has seen us talking about this, and he has something to say about the flood of money that is being produced by the Fed. "Let me just say from the outset that the Federal Reserve has confirmed our Stock Market Crash forecast by raising the Money Supply (M-3) by crisis proportions, up another 46.8 billion this past week. What awful calamity do they see? Something is up. This is unprecedented, unheard-of pre-catastrophe M-3 expansion. M-3 is up an amount that we've never seen before without a crisis - $155 billion over the past 4 weeks, a $2.0 trillion annualized pace, a 22.2 percent annualized rate of growth!!! There must be a crisis of historic proportions coming, and the Federal Reserve Bank of the United States is making sure that there is enough liquidity in place to protect our nation's fragile financial system. The amazing thing is, the Fed's actions mean they know what is about to happen. They are aware of a terrible, horrific imminent event. What could it be?"

At the same time, Dave Ramsden is a guy whose background is to develop models of large fluid systems. He has taken a look at these unholy goings-on as concerns money, and writes on FinancialSense.com site that the monetary aggregates are displaying some unusual traits: "First, just before the models would go unstable, they would usually start exhibiting unreal behaviour. Timeseries of financial instruments are starting to look a lot like a model about to go unstable."

more....his rantings are always too difficult to cut and paste.

[KoKo]

47. Thanks 54...another great rant from him where he "lampoons" everyone.

Always good to read his ravings for a howl. :D

[54anickel]

41. Housing: It’s Different This Time (As It Was For Stocks In 1999)

http://www.ntrs.com/library/econ_research/weekly/us/pc060404.pdf

Below are four charts pertaining to the value of owner-occupied residential real estate. The last period plotted is 2003:Q4. In all cases but one, the last data point is a post-WWII record high. The one exception is mortgage debt as a percentage of the market value of residential real estate, which was at a record high in 2003:Q3. At the end of 1999, similar statistics related to the U.S. stock market were at post-WWII highs. Those who thought that U.S. equity prices at the close of 1999 were significantly overvalued were dismissed with: “You don’t understand. It’s different this time.” Asset price bubbles deflate when the “gas” flowing into them – central bank credit – gets restricted. As we enter a period when the Fed will start to restrict the growth in the credit it provides the U.S. financial system, it will be interesting to see if it really is different this time for the housing market or if it is a bubble just as the stock market was back in 1999.

snip>

If I were a creditor, I would be more concerned about the loan amount compared to the replacement cost of the house rather than the market price. I recall back in the late 1990s, when corporations were taking on large amounts of debt, the cognoscenti told creditors not to worry because debt levels relative to the market value of corporations were falling. When corporate equities went into a swoon starting in 2000, corporate defaults shot up because debt levels relative to the replacement value of corporations were highly elevated. But I’m sure it will be different this time for housing. We had better hope so inasmuch as U.S. commercial banks have a record 60% of their earning assets in mortgage-related obligations.

[54anickel]

42. Shell to cut 600 to 800 information technology jobs

http://www.chron.com/cs/CDA/ssistory.mpl/business/2615683

Shell Oil Co. is cutting 600 to 800 information technology jobs in the United States as part of an effort to save the company $850 million annually beginning in 2008.

The job cuts will be made through attrition, reducing the number of contractors, reassigning some employees to other jobs and offering voluntary severance packages.

Shell hopes to make the reductions by 2006.

Currently, Shell has 9,000 software developers, computer support and other information technology employees worldwide, including 2,200 in the United States. Most of the domestic information technology jobs are in Houston.

snip>

Shell also plans to send more of its work to India and Malaysia. Shell recently signed contracts with IBM and Wipro in India for software support and application development.

[54anickel]

43. Japan's Bonds Have Longest Decline Since 1990 as Stocks Advance

http://quote.bloomberg.com/apps/news?pid=10000101&sid=afqh2oDnM5r8&refer=japan

June 8 (Bloomberg) -- Japanese 10-year bonds fell for a ninth day, the longest losing streak since 1990, as the Nikkei 225 Stock Average rose to a one-month high, cutting demand for debt's fixed payments.

Bonds also fell on expectations a report Thursday will show machinery orders rose in April, adding to evidence economic growth will accelerate. Ten-year bonds have handed investors a loss of 7.5 percent, including reinvested interest, in the past year, compared with a 31 percent gain in the Nikkei 225.

snip>

The sale price was ``too expensive'' which is ``causing some selling after the auction,'' said Kato, chief fixed-income strategist at Lehman, one of 23 banks and securities companies invited to discuss bond sales with the Ministry of Finance.

The government in October will start a primary-dealer system, similar to those in the U.S. and Europe, for selling bonds. It will ask brokerages and lenders to bid for at least 3 percent of government bonds at auctions to qualify as a primary dealer. The bidding results at auctions between April and September will be used to select the primary dealers.

more...

[54anickel]

44. Unions find way to grow; As jobs travel overseas, U.S. recruiting picks up

http://www.chron.com/cs/CDA/ssistory.mpl/business/2614647

During his 15 years with Boeing Co., Stephen Gentry never pictured himself wearing the union label.

Then the computer programmer from Auburn, Wash., was laid off last summer after training his replacement, a worker in India.

Now Gentry, who hasn't worked since, is among those convinced that America's white-collar workers have to band together to keep their futures from being exported to places where skilled labor comes cheap.

"I don't see any other options," said Gentry, 52, who's joined a Seattle-based union trying to organize tech workers around the country. "There's no loyalty anymore. I feel my job was taken by corporate greed."

more...

[54anickel]

45. Parliament debates what to do with excess gold

http://www.swissinfo.org/sen/Swissinfo.html?siteSect=41&sid=4986498

snip>

In the late 1990s the Swiss National Bank (SNB) came under pressure as the public sector began looking for ways to reduce spiralling debt.

The SNB began putting its excess gold reserves on the market in May 2000 with the aim of investing the proceeds in the public sector.

Three years earlier the government had suggested that a third of the excess gold could be used to set up a special charitable fund.

But in a nationwide vote in 2002 the electorate rejected the proposal for a so-called Solidarity Foundation as well as an alternative plan by the rightwing Swiss People’s Party to spend all the money on the old-age pension scheme.

Daily sales

More than 1,000 tons of gold have so far been sold, according to National Bank spokesman Roland Baumann.

He estimates that only 130 tons of the excess reserves will still be in the bank’s vaults at the end of the year.

Garelli says moves are being made in other countries, including in neighbouring France, to follow Switzerland’s example.

“Many governments have discovered that the central banking system has accumulated a lot of reserves which are actually not needed any more in the modern monetary system,” he said.

more...

[KoKo]

48. hmmm....does anyone know who is buying this "excess gold?" That

information could come in handy some day, methinks.

[54anickel]

51. Unfortunately, it ain't me - no money. Looks like Japan's gold has ticked

up a bit again this month though. From post 50 on their reserves -

"Japan had $9.68 billion in gold, up from $9.56 billion in April."

[ozymandius]

46. I gotta run folks.

It's time the boy and I get out for awhile.

Have a great afternoon.

Ozy :hi:

[54anickel]

50. Foreign exchange pool at near-record level

http://www.japantimes.co.jp/cgi-bin/getarticle.pl5?nb20040608a3.htm

Japan's foreign exchange reserves stood at $816.85 billion in May, up $1.88 billion from the previous month, the Finance Ministry said Monday.
The figure for the reporting month was the second highest on record following the $826.58 billion registered in March. The nation's foreign reserves in April fell for the first time in eight months as Japan halted dollar-supportive currency operations.

Separate data released recently by the Finance Ministry show that Japan has stayed away from yen-weakening operations, with the dollar having remained firm against the yen since March 17.

Therefore, the increase in the reporting month is probably a result of investment gains in U.S. Treasury securities that the Japanese government holds.

Japan remained the largest holder of foreign reserves of any country or territory for the 54th straight month, the ministry said, citing the latest comparable data.

more....

[54anickel]

52. 1:05 post lunch update Treasuries still doubled over from Greedspin's

low sucker punch.

Dow 10,401.37 +10.29 (+0.10%)
Nasdaq 2,017.60 -3.02 (-0.15%)
S&P 500 1,139.77 -0.65 (-0.06%)
10-yr Bond 4.790% +0.025
30-yr Bond 5.480% +0.021

NYSE Volume 604,127,000
Nasdaq Volume 807,414,000

12:55PM: Fed Greenspan's comments suggesting the Fed might move faster than expected in raising rates has had little impact on the stock market...bonds, however, have moved lower on the comments, and the dollar has strengthened...that in turn has taken gold (and gold stocks) lower...Sears (S 41.35 +3.05) and KMart (KMRT 65.46 +3.46) are higher on various rumors that Sears might buy or that Sears may be taken private...NYSE Adv/Dec 1240/1869, Nasdaq Adv/Dec 1158/1770
12:25PM: Dow pushes into the green but action is still lackluster...tomorrow, Tommy Hilfiger (TOM) and H&R Block (HRB) report earnings, and the only economic release is wholesale inventories, which has little market impact...on Thursday afternoon, PPI will be released at 3:00 ET...there are thus very few scheduled releases that might create significant market action ahead of the three-day weekend...NYSE Adv/Dec 1144/1952, Nasdaq Adv/Dec 1086/1799

12:00PM: It has been a very stable morning in the stock market...the indices opened lower in response to the big gains yesterday and have shown minor losses throughout the morning...Fed Chairman Greenspan commented that the Fed would do what is required to maintain price stability, which was taken to mean the Fed might raise rates faster than previously expected...this knocked bonds back a bit but had only a minor impact on stocks...more positively, oil prices have dipped a bit ahead of the DOE inventory data tomorrow, but that also has had little impact...

there has been very little corporate news other than Texas Instrument (TXN 25.88 -0.35) reaffirming guidance for the current quarter...decliners lead advancers by a wide margin on light volume, and there are very few strong sectors...the most notable aspect is thus the lack of action, as the indices seem content to post a mild reaction to yesterday's move


Advances & Declines
NYSE Nasdaq
Advances 1226 (36%) 1165 (37%)
Declines 1887 (56%) 1766 (56%)
Unchanged 201 (6%) 172 (5%)

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

Up Vol* 230 (40%) 374 (48%)
Down Vol* 322 (56%) 373 (47%)
Unch. Vol* 19 (3%) 31 (3%)

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

New Hi's 74 67
New Lo's 11 13

[54anickel]

53. Saudi Arabia lifts ban on women working to boost economy after attacks

http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=3&article_id=4920

RIYADH: Saudi Arabia has lifted a ban that kept women from jobs in most fields in what analysts see as a way of fighting extremism and boosting the economy in the wake of the deadly terror attacks in the kingdom.

The Saudi Cabinet, chaired by King Fahd, last week made a landmark decision allowing women to obtain commercial licenses. Previously women could only open a business in the name of a male relative, and religious and social restrictions excluded them from all but a few professions such as teaching and nursing.

"This decision will certainly reduce social and economic pressures on men, who are no longer capable of meeting family needs due to a drop in personal income," said Nahed Taher, a senior economist at National Commercial Bank.

She said that creating employment had become a way of fighting homegrown terrorism.

"It also has an important security aspect in fighting terrorists in the kingdom, as the solution to this problem is no longer of a purely security nature," she said.

more...

[Frodo]

54. So now..... ?

Terrorist attacks in Spain caused an election to swing to the left

and now terrorist attacks in Saudi Arabi are giving women some rights!!???!?!?


I'm almost afraid to draw a conclusion here...

[54anickel]

55. Hey, did any of you Marketeers get a call for this poll?

B-) I know I wasn't included.

Big Investor Outlook Falls to 9/11 Level

http://story.news.yahoo.com/news?tmpl=story&u=/nm/financial_fund_affluent_dc

NEW YORK (Reuters) - The outlook for the U.S. economy among affluent investors polled by Chicago-based consultants Spectrem Group in May fell to the same level as it was in the aftermath of the attacks of Sept. 11, 2001

Spectrem Group said Tuesday its "affluent investor index" fell to a level of 12 in May from 16 in April, remaining in "mildly bullish territory."

However, the index's measurement of the U.S. economic outlook for the next 12 months fell dramatically from 40 in April to 15 in May -- the same level seen shortly after the attacks.

The Spectrem affluent investor index measures the investment outlook each month of 250 U.S. households with $500,000 or more in assets to invest.

more...

[54anickel]

60. Ice cream parlors sweating over surge in milk prices

http://www.chicagotribune.com/business/chi-0406080187jun08,1,2029024.story?coll=chi-business-hed

Blanca Macias knew she would have her hands full when she opened her North Side ice cream shop.

She didn't plan on a double scoop of trouble.

Less than two months after she welcomed her first customers through the doors at her North Clark Street store, she made the difficult choice to raise her prices by as much as 10 percent.

Record milk prices are leaving her, and others in the ice cream business locally and across the country, little choice.

Milk prices have shot up dramatically in recent months, driven by a lack of dairy cows caused by an earlier industry downturn and the mad cow disease scare that has prevented trade across the border with Canada.

On Monday, ice cream manufacturers were paying 40 percent more for Class 4 milk, which includes buttermilk, a key product ingredient, than they were a year ago.

Class 4 milk futures closed at $14.20 at the Chicago Mercantile Exchange on Monday, compared with $10.10 a year ago.

more...

[54anickel]

61. Closing

Dow 10,432.52 +41.44 (+0.40%)
Nasdaq 2,023.53 +2.91 (+0.14%)
S&P 500 1,142.18 +1.76 (+0.15%)
10-yr Bond 4.771% +0.006
30-yr Bond 5.452% -0.007

NYSE Volume 1,193,380,000
Nasdaq Volume 1,465,293,000

Close: The major averages ended up only marginally, but it was a solid day for the stock market...a lower open on profit-taking following Monday's big gains was exacerbated by comments from Federal Reserve Chairman Greenspan that suggested the Fed would raise rates faster than expected it conditions warranted...the may sound obvious, but some took it as a signal that the Fed might be aggressive in tightening...from there, stocks drifted a bit higher, helped by soft oil prices...
when the US government issued a forecast early afternoon that oil prices would drop to $36 a barrel in the third quarter, stocks got a late afternoon boost and the July crude oil contract ended $1.51 lower at $37.15, but the boost to stocks quickly faded...nevertheless, even small gain after the major move yesterday is seen as consolidative and thus supportive...volume was light again, and decliners easily outpaced gainers, so the action was hardly exuberant...there was very little corporate news and the actives list had all the usual suspects with no big movers...NYSE Adv/Dec 1484`/1756, Nasdaq Adv/Dec 1331/1762

3:30PM: The boost from the sharp decline in oil prices today wasn't sustained...the government issued a forecast which suggested oil prices would fall to $36 a barrel in the third quarter, and the July crude contract closed at $37.15, down $1.51...however, the attachment stocks had to oil has weakened in recent sessions once it appeared as if the price would not up forever, and today, the impact was limited...NYSE Adv/Dec 1388/1844, Nasdaq Adv/Dec 1282/1778

2:55PM: The slow, steady ascent continues...the gain of less than 1 point on the S&P is hardly massive, but it is not unimpressive considering the big gain yesterday, the weak breadth today, the low volume, Greenspan's comments, and the lack of any leadership sectors...one thing that has clearly helped is that the July crude oil contract fell $1.51 today...it hasn't been an exciting day, but it is turning into a solid day...NYSE Adv/Dec 1458/1749, Nasdaq Adv/Dec 1330/1687

2:30PM : Indices continue modest upward drift as lack of significant selling pressures after yesterday's move are seen as a positive...Nasdaq is nearing yesterday's high (close) and some technicians put initial resistance at 2025, with a move above that a possible bullish signal...the ratings changes from the brokers have been limited today, with perhaps the biggest call being an upgrade of Bristol-Myers (BMY 25.84 -0.06) to neutral by Oppenheimer and an upgrade of Alcoa (AA 31.59 +0.27) to outperform by Bear Stearns...NYSE Adv/Dec 1327/1843, Nasdaq Adv/Dec 1240/1750


Advances & Declines
NYSE Nasdaq
Advances 1518 (44%) 1361 (41%)
Declines 1736 (50%) 1728 (52%)
Unchanged 181 (5%) 187 (5%)

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

Up Vol* 577 (48%) 800 (54%)
Down Vol* 582 (48%) 635 (43%)
Unch. Vol* 34 (2%) 30 (2%)

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

New Hi's 101 93
New Lo's 15 17