STOCK MARKET WATCH, Tuesday 22 June

[ozymandius]

Tuesday June 22, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 216
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 193 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 247 DAYS
WHERE ARE SADDAM'S WMD? - DAY 460
DAYS SINCE ENRON COLLAPSE = 943
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 21, 2004

Dow... 10,371.47 -44.94 (-0.43% )
Nasdaq... 1,974.38 -12.35 (-0.62%)
S&P 500... 1,130.30 -4.72 (-0.42%)
10-Yr Bond... 4.69% -0.02 (-0.42%)
Gold future... 394.50 -1.20 (-0.30%)


|||


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

---

[54anickel]

1. SNARF!*!* Great toon again, Ozy. Now I've got that crazy

"neener-neener neener-neener" Twilight Zone "music" stuck in my head along with that Rod Serling diag bubble in his voice.

[ozymandius]

3. Alice In Wonderland (screen adaptation by Rod Serling)

<<Bush is the Red Queen>>

Now I cannot get that image out of my head.

[54anickel]

8. "Off with her head!!! Off with her head!!!" - Yep, I can see it.

[htuttle]

56. I think that 'White Rabbit' by Jefferson Airplane...

...would be a suitable new national anthem for the US under Bush.

Especially that part where logic and proportion fall dead and the white knight starts talking backwards. I can relate to that.

[ozymandius]

2. WrapUp by Jim Willie

THE FED’S HYPER-LIQUIDITY ENDGAME

The current financial mess requires, nay, demands a solution. An economic recovery in the usual sense is totally out of the question, since higher interest rates will kill off both the financial sector and the real economy. Each in its structural makeup has grown far too dependent upon easy credit terms, weighed horribly down by debt. The solution needs an engine, a mechanism to recycle debt waste products, and some harsh compromises. Mark Rostenko offers a brief but incisive opinion, that bubbles are everywhere, including in the economy in his May article “Let the Market Do the Talking.”

The Federal Reserve has begun its hyper-liquidity endgame, probably sanctioned by the Dept of Treasury, but certainly not publicized by Wall Street nor even noticed by Main Street. As the differential strengthens between the low-pressure real economy and the high-pressure financial economy, something must give the PERFECT STORM its power. Jim Puplava has outlined its structural makeup for over two years now. He rightly argues that the exploding money supply and declining USDollar will be forces behind the storm. Here, my intention is to describe some of the hypothesized inner workings of that storm and its powerful engineering machinery. The financial engineering, about which the USA boasts, will be put to use on a grand scale. The process has begun in calendar year 2004.

-cut-

THE ANATOMY OF A TRAP

The USDollar decline is powered by economic forces, by financial forces, by banking forces, all of which are gathering momentum. The natural mechanisms, designed to restore economic health, have been supplanted by man-made devices that destroy wealth through monetary growth and encroach upon the real economy. As the real economy shows stress, as the financial sector frets over higher rates, the solution will be seen to print money even faster, and to eradicate official debt (Treasury and Mortgage Agency) via monetization, using freshly minted dollars. The risk from higher interest rates will be transferred to the USDollar. While the real economy heads more firmly into a trap, its liquidity will be accelerated.



-cut-

HYPER-LIQUIDITY TRAP SOLUTION

For the last three years, the Federal Reserve has justified artificially low interest rates, flimsy reasons which the economically untrained masses and experts eagerly gobble up. Investors, speculators, and consumers seem blindly unaware of the risk. The real economy might be breathing some life, perhaps temporarily, but that life depends on ultra low rates. The financial economy might seem strong, perhaps temporarily, but that robustness depends on ultra low rates. It probably is in the midst of a grand stall before the downturn. Each measure used by the Fed presents a signpost for monetary policy toward disaster. No economy can continue forever to extend consumer debt, mortgage finance, and feed the bond, banking, and carry trade industries indefinitely. In the next phase, the USGovt ministries and agencies will secretly fund credit, and redeem bonds, on a level never seen before in our national history. The process has already begun.

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

[ozymandius]

4. This phrase here:

The Fed might interrupt any semblance of economic growth by capping interest rates, and impose more commodity inflation via USDollar debasement. The scale involved for money growth has not been witnessed since the Weimar Republic in the 1920 decade.

I read anymore comparisons between the US today and the 1920's Weimar Republic - even the symbolism of the burning of the Reichstag.

[54anickel]

7. Think I'll buy a couple of wheel-barrows on the next trip to the hardware

store.

[54anickel]

6. Always loved that Jim Willie. He explains the difference between the

US and Japan so well.

snip>

Japan has provided the United States an example of a grand systemic failure. The Fed has publicly stated that the Bank of Japan did not flood their economy will enough liquidity, i.e. inflated money supply. But the BOJ did just that, flood their system. The Fed has criticized the Bank of Japan for encouraging both stock and real estate bubbles. But the Fed has done exactly the same, and has even boasted of doing so. Wealth generation is its specific boast, pointing to the housing sector. Japan had no Fanny Mae centrifuge apparatus. The Japanese bond market became mired and stuck in the proverbial “trap” wherein bond yields remained stubbornly in the 1% range, sometimes even lower. Their govt enforced the tight trap door by enacted regulations that direct govt worker pensions into the Japanese Govt Bonds (“jags”). In doing so, they averted the damage of bond yield reversal. However, the Japanese employed very little bond speculation from carry trade (including mortgage debt) and its powerful leverage. They also have much less consumer debt. They suffered a 50% housing decline, which the US leaders will fight to prevent. We compare poorly to Japan, despite our arrogant claims to the contrary. Japan never suffered from lack of liquidity, and neither will the USA. Our outcome will be as distorted as our population is obese. In almost every respect, Japan has advantages. They continued to overbuild their real economy after bubbles broke. The USA overbuilt its financial sector chronically, and continued to export its real economy after bubbles broke.

A couple of other great points made (IMHO):

...A weaker US Economy than reported will expose the plan as pure folly. The real economy slowdown might be much worse than anyone anticipates. For 30 years we have exported inflation, and now it returns home, directly or indirectly.

The best indicator on the health of the real economy is the yield curve. As the Fed grudgingly hikes rates, watch to see whether long-term rates rise in step. If LT rates do rise, danger exists for unwound carry trades to take them unexpectedly high from a convex response built from speculation. If LT rates do not rise, it could be from Fed backroom actions which put the US Economy at even greater risk down the road, from a USDollar crisis. In the absence of product pricing power, and absence of wage growth, rising oil prices tied to terrorist actions are most likely to slow the US Economy. In the past, higher oil prices have been inflationary. In this current distorted and dislocated environment, higher oil prices might be economically deflationary....

[UpInArms]

5. daily dollar watch

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

Last trade 89.36 Change +0.07 (+0.08%)

http://www.fxstreet.com/nou/noticies/afx/noticia.asp?pv_noticia=1087886711-9e32d306-07657

Forex - US dollar firmer vs yen in Singapore but rangebound ahead of FOMC

SINGAPORE (AFX-ASIA) - The US dollar continued to rebound against the yen in Singapore afternoon trade after hitting two-month lows overnight but remained caught in a range ahead of the US Federal Open Market Committee (FOMC) meeting on June 29-30, dealers said

The euro was also treading water ahead of the FOMC meeting as well as the German ZEW business expectations data for June, which is expected to be released today, and the key Ifo index, an indicator of German business confidence, due out Friday

At 2.10 pm (0610 GMT), the dollar was trading at 108.63 yen, up from 108.54 in early early Tokyo afternoon trade, and off an earlier low of 108.42 and a high of 108.98

The euro stood at 1.2095 against the dollar, compared to 1.2119 in Tokyo earlier, and after trading in a tight 1.2086-1.2133 range earlier

Standard Chartered Bank head of foreign exchange strategy Claudio Piron believes that the yen will continue to strengthen against the dollar in the near term as Japan's economic fundamentals continue to display sound growth

Furthermore, the relatively better performance of Japan's stock market as well as yields for its 10-year bonds compared to that of the US has also helped to strengthen the yen

"Comments from the Federal Reserve suggest that the approach (to US interest rates) will be measured. Taking into account a 25 basis-point hike in US interest rates by the end of this month, our forecast for the dollar by end- June is (still) 105 yen," Piron said. Piron attributed the possible weakness in the US dollar going forward to the widening US current account deficit. The US Commerce Department reported recently that the current account deficit, the broadest measure of the nation's financial interaction with the rest of the world, widened to a record 144 bln usd in the January-March quarter. As for the euro, Piron said the market will be waiting for the release of two German economic indicators, namely the ZEW business expectations for June and the key Ifo index, this week.

...more...

http://economictimes.indiatimes.com/articleshow/748944.cms

Weak dollar adds a punch to foreign debt

(this is from an Indian point of view)

Since the dollar has depreciated against all other currencies over the past one year, India has seen a peculiar situation unfolding. Of the total rise in India’s external debt of $6817m, between December ’02 and December ’03, $5690m, or about 83%, of the increase has been contributed by the valuation changes that have resulted from the weakening of the US dollar against other currencies.

The status report on external debt published recently has revealed this statistic. The major currencies that make up the Indian external debt consist of the US dollar (46bn), Special Drawing Rights (SDRs) of the IMF ($12bn), Japanese yen (1.3trillion), euro (5.7bn) and Indian rupee (Rs 1.1trillion).

Queerly, according to the provisional numbers, while US dollar debt constitutes 41.6% of the external debt as of December ’03, Indian rupee debt has the next biggest share in the currency composition of external debt at 21.4%. The rupee debt is owed to Russia and is payable only through exports to Russia.

Using end-December ‘02 exchange rates, the rupee component of the debt is valued at $22.7bn while using end-December ‘03 exchange rates, the debt is valued at $23.9bn, an increase of $1.2 bn. In a similar fashion, yen and euro denominated debt has seen an appreciation of $1.4bn and $1.2bn respectively. The SDR, which is an international reserve asset, created to supplement world trade and financial development used by the IMF is defined in terms of the basket consisting of US dollar, euro, Japanese yen and pound.

...more...

and just 'cause we should know:

http://www.newsok.com/cgi-bin/show_article?ID=1268185

Ailing finances force hospital to lay off 71

MIDWEST CITY - Seventy-one employees of Midwest Regional Medical Center have been laid off.

A hospital-based Medicaid obstetrical clinic for poor, pregnant women and a home health care service also have been closed because of the firings.

Sixty layoffs were made Friday, following 11 earlier this month. Of that number, 38 are full time and 33 are part time.

Officials said the firings won’t directly affect patient care at the hospital, 2825 Parklawn Drive.

...more...

Great 'toon today, Ozy! I know I have felt in the "Twilight Zone" since Dec 12, 2000. Will someone wake me up when it's over?

Have a Great Day Marketeers!

[54anickel]

10. Hey, the buck is up quite a bit from the 89.12 low late last night. Have

you noticed lately how the currency markets tend to look at, comment and move on "real" economic data for the Euro and Yen, but for the almightly buck the commentary and moves tend to revolve around interest rate anticipation and the Fed?

[54anickel]

12. A bit on the overnight rise in the currency futures from INO

The September Dollar was higher overnight due to short covering but remains below the 10-day moving average crossing at 89.90. Closes below last Tuesday's low at 89.42 would signal that the rebound off last week's low has come to an end. Stochastics and the RSI are turning neutral hinting that this month's short covering bounce might be coming to an end. Closes above last week's high crossing at 90.77 would open the door for a possible test of the 62% retracement level of the May-June decline crossing at 91.13 later this summer. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

The September Euro was lower overnight as it consolidates above the 62% retracement level of the April-June rally crossing at 119.586. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. Closes below last Monday's low at 119.36 would open the door for a possible test of the 75% retracement level crossing at 118.71 later this summer. Closes above last week's high crossing at 121.50 would temper the near-term bearish outlook in the market. Overnight action sets the stage for a steady to weaker tone in early-day session trading.

snip>

The September Japanese Yen was slightly higher overnight and are challenging resistance marked by the early-June high crossing at .9239. Multiple closes above .9239 would open the door for a test of May's high crossing at .9280. Closes below the reaction low crossing at .8970 would confirm that a short-term top has been posted while opening the door for a larger-degree decline during June. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

[54anickel]

9. S&P futures are headed the wrong way again this morning.

8:26AM: S&P futures vs fair value: -0.2. Nasdaq futures vs fair value: +6.0. Better than expected earnings results from Goldman Sachs (GS) and Morgan Stanley (MWD) greeted with a collective yawn by the futures market, which continues to point to a mixed start for the cash market

8:01AM: S&P futures vs fair value: +0.2. Nasdaq futures vs fair value: +6.5. Futures market pointing to a relatively mixed start for the cash market with the tech sector likely to outperform in the early-going, boosted by the palmOne (PLMO) earnings report and guidance

6:27AM: S&P futures vs fair value: +0.5. Nasdaq futures vs fair value: +6.0.

[UpInArms]

11. I think I heard someone yawning

as they woke up this morning.

http://www.kansascity.com/mld/kansascity/business/8979586.htm?1c

Small step against inflation

When it comes to tracking inflation, it's becoming ever more tempting to adopt the pro forma accounting approach.

You know the drill: Ignore the bad stuff and declare all is well.

We've been hearing that sort of logic lately from some of the folks with a sartorial taste for tweed. We're told to ignore the fact that the Consumer Price Index surged in May at the highest monthly rate in more than three years. Although the 0.6 percent increase in May is just a one-month snapshot, it projects to more than a 7 percent annual inflation rate if sustained.

But that's not the right way to look at things, we're told. If we throw food and energy out of the equation, the so-called core inflation rate was just 0.2 percent in May, which projects to a relatively tepid annual inflation rate.

Economists argue that food and energy prices are too volatile to overreact to on a monthly basis.

“Our general view is that inflationary pressures are not likely to be a serious concern in the period ahead,” Federal Reserve Chairman Alan Greenspan told Congress last week.

That's quite comforting, actually. At least until we top off the tank or buy milk for our kids.

In May alone, the cost of gasoline surged 8.1 percent. (It increased at an annual rate of 66.7 percent over the past three months.) The cost of dairy products jumped 6.8 percent in May. (It has risen at an annual rate of 41.4 percent over the past three months.)

The problem for regular folks is: We buy that stuff every week. Those prices are right in our face. They're unavoidable. They shape mass psychology. We don't check the price of personal computers, which have declined at a 7.3 percent annual rate over the past three months, every week of our lives.

That's why we have people like Greenspan around to keep their eyes on the big picture.

...more...

[54anickel]

14. On that same theme: "Everything Is Under Control"

http://www.gold-eagle.com/editorials_04/rostenko062104.html

snip>

Stocks finished out another rather uneventful week as participants continued to weigh various geopolitical concerns and economic uncertainties. The market is still neither here nor there, continuing to carve out a wide trading range or very possibly, a massive topping formation. Seems that every month we have something new to be concerned about and every month someone from the Fed comes out to tell us there's nothing to worry about. And the market simply teeters back and forth, worrying and then feeling relieved again.

Deflation? "We've got it licked." Inflation? "Licking it as we speak." Housing bubble? "No such thing." Iraq? "Under control. Never mind all the dead soldiers. Out of sight, out of mind." Terrorism? "We've confiscated over 300,000 Swiss Army nail files from American business travelers in the last 15 months alone. Enjoy your flight."

The Administration has been gloating over the 5.6% unemployment rate for some time. But the hidden numbers tell a different story. A broader number which attempts to account for the "hidden unemployed" suggests the rate is closer to 9.7%.

No worries says Fed Governor Lyle Gramley. "It shows there is more slack in the labor market than appears on the surface...That means fears that inflation is about break out all over the place do not seem warranted."

Truly we're blessed to live under the firm guidance of a Fed that has managed the ultimate "Goldilocks economy" in which all news is good news and that includes the bad news. Which is of course in fact good news only masquerading as bad for variety.

more...

[UpInArms]

13. When Fighting HMOs, Shoot First

http://www.forbes.com/healthcare/2004/06/22/cx_da_0622topnews.html

NEW YORK - Are health maintenance organizations in the business of practicing medicine? No, the Supreme Court says: They are in the business of denying medicine.

Yesterday, the court weighed in on one aspect of so-called patients' rights laws and held that patients could not sue HMOs for the results of their refusal to pay for certain doctor-approved remedies. The best they can do under the federal law that governs such matters is sue under the insurance policy for reimbursement of the cost of the benefits the HMOs denied.

In a unanimous decision written by Justice Clarence Thomas, the court held that coverage-denial suits against HMOs cannot be filed under state malpractice laws but must proceed in federal court under the Employee Retirement Income Security Act of 1974. "We hold that the causes of action are completely pre-empted and hence removable from state to federal court," Thomas wrote.

The decision in Aetna Health v. Davila came in response to two cases first filed in Texas courts. In one, plaintiff said the HMO forced him to take the drug Naprosyn for his arthritis, rather than the Vioxx his doctor prescribed. The patient reacted badly in way that required extensive treatment and hospitalization. The second suit involved a patient who underwent surgery. Although her treating physician recommended an extended hospital stay, a Cigna (nyse: CI - news - people ) discharge nurse determined that she did not meet the plan's criteria for a continued hospital stay. The result, she alleged, was a relapse and a return to the hospital.

Then Governor George Bush signed the patients' rights law. But since coming to Washington, Bush's enthusiasm for the Texas law has waned and the Justice Department sided with the insurance companies, units of Aetna (nyse: AET - news - people ) and Cigna. A federal appeals court said the insurers should be held to the duty of ordinary care that applies to doctors practicing medicine. But the Supreme Court said the only issue was whether the insurer provided the coverage that the policy dictates. Thus the patients were out of court--at least state court. They could still sue on other, less remunerative, grounds in federal court.

...more...

[54anickel]

15. Is the dollar crisis over? (There is no crisis - damn it!) From the same

author that last week was claiming this is a bull market. A contrarian view for a "balanced" perspective. :evilgrin:

http://www.gold-eagle.com/gold_digest_04/droke062204.html

Everyone you turn in the financial press, it seems, you're confronted with discussions about the "horrible dollar crisis." This of course refers to the bear market recently experienced in the U.S. dollar index. But while pundits continue to talk of a "coming collapse" of the U.S. currency, has the time now come for us as contrarians to start thinking about a dollar turnaround? I believe so.

That the so-called "dollar crisis" has very likely ended smacked me right in the face recently. I noticed this ad for a top-selling financial book addressing the very same issue in the London Financial Times. The headline reads, "The dollar crisis has only just begun." Actually, just the opposite is likely true. If this isn't a sure-fire contrarian bottom signal for the dollar then I don't know what is! It doesn't get any more obvious than this, folks! The message is plain and clear -- the dollar crisis is over for now.

Despite what many pundits are saying, I believe the dollar has very likely seen its low for a good while. The dollar found support above a major long-term benchmark and has been grinding out a basing pattern every since. The weekly chart below shows the dollar index gently rounding out a bottom. But an even more persuasive case for a dollar bottom is found in the longer-term monthly chart.

snip>

A glance at the long-term yearly chart of the dollar shows that every time in the past 20 years the dollar index has tested its critical benchmark 80-85 area (in 1990, 1992, 1995 and more recently in 2003) there is always a strong support between those levels followed by an upside reversal. The feds have no plans to allow the dollar to collapse anytime in the near future, especially as the global economy isn't fully integrated yet (the ultimate objective). Until then we can expect a supported dollar.

[54anickel]

16. Zero Down for the American Dream (Ron Paul)

Some interesting points:

http://www.house.gov/paul/tst/tst2004/tst062104.htm

snip>

The Zero Downpayment Act, as its names suggests, creates a federal program that allows some homebuyers to obtain federally-insured mortgages without making a down payment. “Federally-insured” really means taxpayer-insured, as taxpayers like you foot the bill for defaults. So while Congress congratulates itself on yet another program that supposedly helps the poor, it is taxpayers who pay for the inevitable defaults.

Every mortgage banker knows that even a modest downpayment greatly increases the likelihood that a buyer will pay his mortgage as promised. A buyer who has consistently saved money for a down payment is by definition a better credit risk, and it’s harder to walk away from an obligation if it means losing a sizable amount of hard-earned money. A downpayment measures a buyer’s willingness and ability to make sacrifices in order to reach a goal and improve his standard of living. Banks used to recognize hard work and thrift as indicators of creditworthiness, and in a free market would demand a significant down payment for virtually all homebuyers.

But as with all federal intervention in the economy, housing welfare distorts the mortgage industry and makes ordinary Americans poorer. Banks, of course, love federal mortgage programs- after all, the risk of default is transferred to American taxpayers. The lending mortgage banks get paid whether homebuyers default or not, and what business wouldn’t love having the federal government guarantee the profitability of its ventures? Between the Federal Housing Administration, which is the largest insurer of mortgages in the world, and the government-created Fannie Mae and Freddie Mac corporations, the mortgage market is hopelessly distorted. Millions of mortgages in this country are federally insured, and the tax bill for defaults could be astronomical if the housing bubble bursts.

Despite the congressional rhetoric about helping the poor, federal housing policies often harm poor people by pushing them into houses they may not be ready to buy. Given the realities of insurance, property taxes, maintenance, and repairs, many low-income buyers lose their homes and destroy their credit ratings. Easy credit and low interest rates, courtesy of the Federal Reserve, have dramatically increased housing demand and artificially increased prices. Zero down payment schemes do the same thing by pushing renters into the housing market. This increased demand actually serves to price many poor Americans out of the housing market indefinitely.

[Doctor Smith]

48. Ron Paul is one of the few politicians who "gets it".

And he's from Texas, too!

[UpInArms]

17. Markets are Open at 9:36 EST

Dow 10,348.02 -23.45 (-0.23%)
Nasdaq 1,973.59 -0.79 (-0.04%)
S&P 500 1,128.52 -1.78 (-0.16%)
10-Yr Bond 4.714% +0.024

and the pre-market blather

briefing.com

9:13AM: S&P futures vs fair value: -1.6. Nasdaq futures vs fair value: +3.0. Futures trade continues to slip off its highs, but still points to a mixed start for the indices... The past sessions have seen a narrowing of the trading range, and with volume exceptionally light, it is likely today will be another lackluster day in the market.

8:57AM: S&P futures vs fair value: -1.4. Nasdaq futures vs fair value: +3.0. Indices remain set for a split open as technology gets a lift from earnings from PCLN and PLMO last night, and the broader market finds few catalysts in the morning news items... GS and MWD's better than expected Q2 (May) earnings reports have not been a surprise following BSC and LEH's earnings last week - if anything, they have re-focused attention on the less favorable banking environment down the road.

8:26AM: S&P futures vs fair value: -0.2. Nasdaq futures vs fair value: +6.0. Better than expected earnings results from Goldman Sachs (GS) and Morgan Stanley (MWD) greeted with a collective yawn by the futures market, which continues to point to a mixed start for the cash market

8:01AM: S&P futures vs fair value: +0.2. Nasdaq futures vs fair value: +6.5. Futures market pointing to a relatively mixed start for the cash market with the tech sector likely to outperform in the early-going, boosted by the palmOne (PLMO) earnings report and guidance

6:27AM: S&P futures vs fair value: +0.5. Nasdaq futures vs fair value: +6.0.

ino.com

The September NASDAQ 100 was higher overnight due to short covering. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing at 1455.50 would open the door for a possible test of the June 3rd low crossing at 1446.50 later this month. Closes above 1500 are needed to renew the rally off May's low. The September NASDAQ 100 was up 4.50 points at 1462.50 as of 6:46 AM ET. Overnight action sets the stage for a steady to firmer opening by the NASDAQ composite index later this morning.

The September S&P 500 index was higher overnight due to short covering but remains below initial support marked by the 10-day moving average crossing at 1132.70. Closes below last Monday's low at 1121.80 would confirm that a short-term top has been posted. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes above the June 8th high at 1142.20 would open the door for a test of April's high crossing at 1147.10 later this month. The September S&P 500 Index was up 2.00 pts. at 1131.20 as of 6:48 AM ET. Overnight action sets the stage for a steady to firmer opening when the day session begins later this morning.

[54anickel]

19. Doesn't look like a mixed start to me, they're all the same color - RED!

[Maeve]

20. Give them a minute and the Nas will rise above the surface

Although it sure doesn't want to get above 2000, does it?

[54anickel]

24. HA, sure nuff, lookie here. You are such a see-er!

Dow 10,362.95 -8.52 (-0.08%)
Nasdaq 1,979.62 +5.24 (+0.27%)
S&P 500 1,129.90 -0.40 (-0.04%)
10-yr Bond 4.708% +0.018
30-yr Bond 5.386% +0.012

[UpInArms]

25. here's the "bounce" at 9:52 EST

Dow 10,364.03 -7.44 (-0.07%)
Nasdaq 1,979.86 +5.48 (+0.28%)
S&P 500 1,129.90 -0.40 (-0.04%)
10-Yr Bond 4.706% +0.016

[Maeve]

32. But unsustained at 10:33

Dow 10,344.11 -27.36 (-0.26%)
Nasdaq 1,972.91 -1.47 (-0.07%)
S&P 500 1,128.05 -2.25 (-0.20%)
10-Yr Bond 4.700% +0.010

Not sure why the fast fade in the past 15 minutes or so...

[ozymandius]

35. 54anickel's post (#31) may provide some answers.

Overseas markets sense rising interest rates. There's one specific mention of an immediate impact on US bond and equities markets.

[54anickel]

18. Morgan Stanley's Profits More Than Double

http://biz.yahoo.com/rb/040622/financial_morganstanley_earns_2.html

NEW YORK (Reuters) - Investment bank Morgan Stanley (NYSE:MWD - News) on Tuesday said its quarterly earnings more than doubled, driven by its investment banking businesses and strong trading revenue from fixed income and equities.

snip>

The increase comes as Morgan Stanley and other banks work to weather the changing interest rate environment. As borrowing costs rise, banks have tried to bolster revenues from mergers advisory and stock underwriting to make up for an expected decline in fixed income.

snip>

Revenues from fixed income sales and trading rose by 43 percent to $1.8 billion form last year's second quarter, while revenue from sales and trading of equities rose by 29 percent to $1.1 billion.

Revenue earned from advising companies on mergers and acquisitions, one of its most lucrative businesses, rose by 130 percent to $324 million.

[UpInArms]

21. (CA) Forecast: Jobs, Income To Rise, Real Estate To Fall

http://www.nbc4.tv/news/3446048/detail.html

LOS ANGELES -- Jobs and personal income will rise in California in 2004 and over the following two years, but the housing market will cool, although not dramatically, according to a bullish new economic forecast.

The new forecast reflects a growing consensus among economists that California's economy has finally turned the corner toward a robust recovery, according to the Los Angeles Times, which reported on some of the forecast's key findings ahead of its formal release Tuesday.

Although the state's job creation pace lags behind the nation's, that will soon change after three straight months of job gains, according to The University of California, Los Angeles and other economists quoted by The Times.

The UCLA forecast says rising incomes, better job balance, stronger foreign trade and an emerging comeback in the state's crucial technology sector are all behind the state's bright outlook, according to The Times.

...more...

[54anickel]

22. Global: The Asset Economy

http://www.morganstanley.com/GEFdata/digests/20040621-mon.html#anchor0

The equity bubble of the late 1990s was a transforming event in many ways for the US economy. But there is one lasting implication that stands out above all - an important transition in the character of the American growth dynamic. The income-driven impetus of yesteryear has increasingly given way to asset-driven wealth effects. For consumers, businesses, policymakers, and investors, the asset economy turns many of the old macro rules inside out. In the end, it could well pose the most profound challenge of all to sustainable recovery in the United States.

The genesis of the asset economy can be traced back to the late 1980s. Prior to that period, there was little change in the role of assets as a driver of US economic activity. Over the 1952 to 1985 time span, the ratio of household sector assets to GDP fluctuated in a fairly tight range centered around 3.75. But then, as the all-powerful secular bull markets in stocks and bonds took hold, that ratio started to drift upward. In the latter half of the 1980s and the first half of the 1990s, it moved up to around 4.25. And then, courtesy of the Great Equity Bubble, it took off. Over the 1994 to 2003 period, household sector assets expanded by 84% - more than 50% faster than the growth of nominal GDP over the same interval. As a result, the ratio of US household sector assets to GDP pierced the 5.25 threshold in 1999. While the asset base was then pruned in the post-bubble carnage that was to follow, by the end of 2003, household sector assets still stood at 4.9 times US GDP, well in excess of earlier norms.

The emergence of the asset economy over the past decade is traceable to two developments - the equity bubble of the late 1990s and the sharp appreciation of property in the early 2000s. Over the 1994-99 period, equity holdings rose from about 19% of total household assets to about 35%. For most of the long sweep of modern economic history, the home had been the American family's most important asset. As the equity bubble expanded, there was an extraordinary role reversal. In both 1998 and 1999, the equity share exceeded the property share of total household sector assets for the first time ever. In the post-bubble shakeout that was to follow, there was a reversion back toward earlier norms. However, while the equity share of total household sector assets fell back to 24% by the end of 2003, it was still double the average from the mid-seventies though the 1980s. Meanwhile, the tangible property share of consumer assets had risen back to about 37% at the end of 2003, near the upper end of historical experience.

It didn't take long for the American consumer to uncover the miracle of the Roaring Nineties. The "wealth effect" - the ability to monetize asset inflation and convert it into consumer purchasing power - quickly became the rage. The macro role of wealth effects is very much dependent on context. In a vigorous income generation climate, wealth effects are the "icing on the cake" - in effect, allowing households to indulge in excess spending or build saving for the future. In an income-constrained environment, the wealth effect takes on a very different role; it can plug the gap brought about by a shortfall in income generation, thereby enabling consumers to defend the lifestyles they had grown accustomed to. Both roles have come into play in recent years.

more...

[UpInArms]

23. Dow, DuPont in price-fixing probe

http://money.cnn.com/2004/06/22/news/international/bayer.reut/

FRANKFURT (Reuters) - Bayer AG said Tuesday it will cooperate fully with an investigation over price fixing by chemical makers that is reported to have widened into a global probe and also involves Dow Chemical Co. and DuPont.

The Wall Street Journal reported that U.S. and European investigators were looking into allegations of price fixing in half a dozen chemicals used in plastics, rubber and synthetic materials in the United States, Canada, Europe and Japan.

It said this represented a widening of a two-year-old investigation into price fixing in the chemical industry.


Bayer did not comment on the specifics of the report but said it was cooperating with the authorities.

"This is not a new development. It's based on allegations of cartel activities in certain rubber-related lines of business and has involved Bayer since the fall of 2002. We are fully cooperating with the authorities," a Bayer spokesman said.

...more...

[54anickel]

26. Don't Bet the House

http://www.thestreet.com/_tscana/funds/annperry/10167010.html

Don't get caught with your mortgage rate going up and the value of your home going down.

With mortgage rates on the rise as the Fed approaches its first rate hike in more than four years and home buyers scrambling for affordable monthly payments, some alternatives to the standard 30-year fixed and adjustable-rate mortgages (ARMs) could prove risky, say mortgage experts.

"Leverage is the order of the day," says Keith Gumbinger, vice president of HSH financial publications of Pompton Plains, N.J. "You need to be very careful of misusing a mortgage product. A lot of these things have not been tested in a rising interest rate environment."

Gumbinger is especially concerned about heavily promoted "interest-only" loans that allow borrowers to reduce their monthly payments for a period of time, say three or five years, by paying only interest and no principal. After the prescribed time period, the borrower either owes the entire balance or must begin paying both principal and interest on the balance of a 30-year term, typically resulting in a big jump in monthly payments.

The scariest interest-only loan is an ARM whose interest rate adjusts monthly based on a standard index, says Gumbinger.

more...

[UpInArms]

27. here are some background links

http://www.merkinvestments.com/archive-by-date/2004/2004-02-23.en.html

Greenspan: "the traditional fixed-rate mortgage may be an expensive method of financing a home"

In a speech at the Credit Union National Association, Greenspan today said that homeowners "might have saved tens of thousands of dollars had they held adjustable-rate mortgages rather than fixed-rate mortgages during the past decade." He continued: "American consumers might benefit if lenders provided greater mortgage-product alternatives to the traditional fixed-rate mortgage."

Short-term or variable rate mortgages are the better deal in an environment with sinking interest rates, such as what we had in the past decade. However, as the Bank of England has warned (see our 18 Nov 2003 Newsletter), many consumers are not aware of the risks posed of short-term debt exposure in a rising interest rate environment.

There are already numerous variable and short-term instruments available for the sophisticated (or naive) homeowners. Greenspan's speech is an encouragement to use these short-term instruments. As the Wall Street Journal comments, "It is almost unheard of for an official of the central bank to offer advice on interest rates, over which it has enormous influence."

We would go much further than this: unless Greenspan clarifies his comments, he must resign. Calling on homeowners to leverage their personal finances using short-term debt is a financial distress call. Greenspan must be desperate to get consumers to take ever more money out of their homes, to inflate home prices. He can only make such a statement if he knows short-term rates will stay low for years to come, at any cost. The "cost" will be sharply higher long-term rates and a faltering dollar.

We very much hope that Greenspan will put his words into perspective. It is our view, however, that Greenspan is indeed desperate and means exactly as he said. Greenspan's entire monetary policy has been based on wealth creation through higher real estate prices; he is taking this concept to new levels thereby risking an unprecedented real estate bubble, and a subsequent collapse of unprecedented proportions.

...more...

http://www.suntimes.com/output/savage/cst-fin-terry045.html

Look before you leap on Greenspan's ARM plug

Don't follow Alan Greenspan's advice! The Federal Reserve chairman isn't supposed to forecast interest rates, but there he was last week, warning home buyers against fixed-rate mortgages and promoting adjustable-rate mortgages to achieve financial "flexibility." Instead, it's likely he's luring many households into financial disaster.

Greenspan can't promise that interest rates will remain at present, historically low levels, because the Fed chairman can't control long-term rates. And the Fed chairman is not supposed to be forecasting future interest rates anyway. So why would he lead homeowners into a trap that could cost them plenty of money if long-term interest rates rise in the coming years?

I've previously noted in this column that Greenspan doesn't have a great track record on forecasting markets. It was just a few months ago that he was warning of soaring natural gas prices, just as that market hit its peak, and started to fall. And back on March 6, 2000 -- four days before the all-time peak in the Nasdaq index and the subsequent meltdown -- he was publicly extolling the virtues of the new era in technology.

...more...

[54anickel]

28. So glad he's watching out for the public's best interest!

:puke:

[ozymandius]

30. I've come to loathe this jackass.

After so many years at the helm of the Federal Reserve, a pattern has emerged that reveals his modus opperandi. Greenspan is a bubble charlatan. Is it any wonder why the faces of the Senators on the banking committee looked so grim? These are not stupid people. I imagine they tasted a bit of bile in the base of their throats during the dog-and-pony-show of a confirmation hearing.

Greenspan's policies are, in effect, a mortgaging of their grandchildrens' future.

[54anickel]

31. He's got the world by the kahunas - U.S. Rate Hike Gloom Weighs Overseas

http://www.washingtonpost.com/wp-dyn/articles/A59541-2004Jun22.html?nav=headlines

LONDON (Reuters) - Expectations that the U.S. Federal Reserve will hike official interest rates at next week's meeting dampened equity and bond market sentiment Tuesday.

The dollar was firm against most major currencies for the same reason, but softer against the yen on hopes that Japanese economic data would confirm the rosy economic outlook and prompt the Bank of Japan to end its ultra-easy interest rate policy.

Overall, markets are focused on the U.S. central bank's meeting on June 29-30, U.S. June jobs data on July 2 and the handover of power in Iraq on June 30.

"Stock, bond and currency markets go into a temporary void until next week's FOMC rate decision and the June US employment report, which will provide the next key directional trading signals," said David Brown economist at Bear Stearns.

more...

[UpInArms]

36. Meanspin has been one of the worst things

(I can't even raise him to the level of animal life - merely an object) that has been foisted on the US citizenry.

The spin and thievery that he has managed to inject into every monetary facet is horrific.

[54anickel]

38. Yep, and he's been there for sooooo long. There's an entire generation

that knows nothing else but "financial engineering" as the "normal" MO for the Fed.

[54anickel]

29. GACK!! The Pledged Assets Mortgage - Why would anyone DO that!

Wonder if we will see a huge drop in the HNWI numbers over the next couple of years?

snip>

The association said that unnamed brokerage firms were providing up to 100% financing loan-to-value mortgages to customers who, in lieu of a down payment, pledged their stocks, bonds, mutual funds and other securities. While these mortgages allowed the customers to avoid paying private mortgage insurance, or PMI, the NASD warned that they could be risky.

Here's what can happen. If the value of the securities falls below a set minimum, the borrower could be required to deposit more cash or securities and the brokerage can sell the securities to meet a collateral call without contacting the borrower or getting permission about which securities to sell.

Also, because the loan is a 100% mortgage, the interest is usually greater than on a mortgage used with a cash down payment. If borrowers who choose an adjustable-rate mortgage and interest rates rise, the NASD cautioned, the returns from the investment portfolio might not keep up with the rising mortgage payments. This is especially prone to happen if the portfolio contains bonds, which decline in value when interest rates rise.

[Maeve]

39. That's a balloon mortgage

Good grief...remember the old melodramas where the villain has the mortgage on the family house and they have to pay up or lose everything? (But the villain will take the daughter's hand in marriage as payment?)

Balloon mortgage. More like leasing than actually buying.

[ozymandius]

33. WHO???

A donor star has suddenly appeared by my name. If someone here is responsible for this then I need to thank you properly.

My gratitude is overflowing.

Thank you!

Ozy :loveya:

[54anickel]

34. The Bear's Lair: When bond bubbles burst

http://www.upi.com/view.cfm?StoryID=20040618-032512-6704r

WASHINGTON, June 21 (UPI) -- "Gentlemen prefer bonds" responded Treasury Secretary Andrew Mellon when asked his opinion of investing in the 1920s stock market bubble. Well not today they don't, if they've got any sense.

The bond market has been the principal prop of most of the financial services industry since 2000. Just as income from investment banking activities took a precipitous drop, at the end of 2000, the Federal Reserve began to cut short term interest rates to historically unprecedented levels, currently 1 percent for federal funds, providing a large "carry" whereby you could borrow in short term markets and buy long term Treasury bonds, locking in a profit of 3 percent per annum or more, which may not sound much but is pretty juicy when you're allowed to leverage the position 15 or 20 times.

This allowed the major banks to write off a high proportion of their bad loans, incurred during the bubble years -- banks made billion dollar write-offs on such borrowers as Enron and Global Crossing, and still managed to report record profits for the year in which the write-offs were made.

snip>

If a bank tells you it can hedge this interest rate risk in the derivatives markets for swaps and options, don't believe it. Particularly don't believe it if it is a participant in home mortgage lending, let alone Fannie Mae or Freddie Mac themselves. The price risk on holdings of long term bonds can be hedged, it's true. So can the gap risk between short term funding and long term assets, although almost nobody does hedge this risk since it's been profitable for the last 20 years. However, the duration risk, from home mortgages being refinanced if rates drop but not if they rise, has never been hedged successfully, because models predicting the pattern of refinancings are highly inaccurate. In addition, whereas a mortgage lender's losses when rates drop from early refinancings are easily matched by its profits from refinancing fees, the losses on below-market interest rate mortgages stuck in its portfolio for 30 years have no corresponding match -- holders of mortgage bonds have at that stage turned themselves into 1970s S&Ls.

Even more unhedgeable is credit risk, which increases as interest rates rise, borrowers find it more difficult to service their debt, asset markets cool and asset prices decline. While you can on-sell credit risk to a third party, the overall volume of credit risk cannot be hedged away, it just lands on the insurance companies or whoever has bought the credit risks.

more...

[54anickel]

37. As company profits rise, stock prices ... don't

A rally just waiting to happen!
Greenspin: "See, everything is going as planned." :eyes:

http://www.usatoday.com/money/markets/us/2004-06-21-peshrinkage_x.htm

NEW YORK — It's an equation that some Wall Street gurus say simply doesn't add up: Corporate profits are booming, but stock prices have barely budged.
As the second quarter winds down, Corporate America is on track for its fourth-consecutive quarter of year-over-year profit growth above 20%, the first such streak in four years, Thomson First Call says. Yet, the benchmark Standard & Poor's 500-stock index is up just 1.7% in 2004.

That disconnect between business profits and stock profits is frustrating investors. But there is a silver lining: It has made stocks more affordable.

If you value the S&P on projected 2005 profit, stocks trade at 15.5 times earnings, not far from the average price-earnings ratio of 14 dating to 1926, says Ibbotson Associates, and about half 1999's nosebleed P-E of 28.9. "While everyone has been sitting around worrying about the market being overvalued, it has sneakily revalued itself," says Jim Paulsen, chief investment strategist at Wells Capital Management.

The shrinking P-E does not mean stocks are super cheap, but it suggests they have room to rise if the inflation rate stays low and the Federal Reserve raises interest rates more than expected, Paulsen says.

more...

[UpInArms]

40. Market Numbers at 10:52 EST

Dow 10,334.16 -37.31 (-0.36%)
Nasdaq 1,971.18 -3.20 (-0.16%)
S&P 500 1,127.20 -3.10 (-0.27%)
10-Yr Bond 4.702% +0.012

0:30AM: Steady trade continues...focus is on the Fed's policy announcement a week from today...durable goods orders is the next potentially significant economic release, which is due on Thursday...Nasdaq held after approaching 50 and 200 day moving averages...decliners slightly lead advancing issues, and the Russell 2000 Index is down slightly, indicating that the broad market is soft along with the major averages...NYSE Adv/Dec 1240/1499, Nasdaq Adv/Dec 1223/1351

10:00AM: Indices hold near unchanged in listless trade...volume is again light...palmOne (PLMO 29.16 +7.70) heads the Nasdaq most active list after posting much better than expected earning after the close yesterday and guiding current quarter estimates higher...otherwise, the Nasdaq actives list has the regular suspects...

Gotta run for now - hopefully will be back later :hi:

[54anickel]

41. Enron's Lay seeks meeting with gov't

Hmmm, a meeting to discuss his position of "ya can't touch this, nosiree, can't touch me!" NA-NA!!!

http://money.cnn.com/2004/06/21/news/newsmakers/lay.reut/index.htm

HOUSTON (Reuters) - Former Enron Corp. Chairman Ken Lay is seeking a meeting with federal prosecutors to discuss reports that he would be indicted within two weeks, his lawyer said Monday.

Michael Ramsey, head of Lay's legal team, also reiterated his belief that the government had no case against his client.

"I don't believe Ken Lay will be indicted at all. Ken Lay didn't do a crime," Ramsey told a press conference.

The Houston Chronicle reported Saturday that prosecutors from the U.S. Department of Justice's Enron Task Force would seek a grand jury indictment in the next two weeks, although sources told Reuters such a move was not imminent.

snip>

Lay, a major financial contributor and political ally of President Bush and his father, former President George H.W. Bush, returned to Enron's chief executive post after Jeff Skilling resigned shortly before the company imploded in late 2001.

[54anickel]

42. And in a related case: Bankers fighting extradition

http://www.chron.com/cs/CDA/ssistory.mpl/business/2639993

Three former bankers are contesting extradition from Britain to face charges in the United States that they stole $7.3 million in an Enron-related fraud. David Bermingham, Gary Mulgrew and Giles Darby, who face seven counts of wire fraud, appeared before Bow Street Magistrates Court in London.

They were indicted by a Houston grand jury in 2002 for allegedly using an Enron off-the-books partnership to defraud their employer, Greenwich NatWest, which is now a part of Royal Bank of Scotland Group.

"The defendants persuaded their employer to sell for $1 million an interest in a company from which they themselves then engineered a payment of $7,352,626," said John Hardy, a lawyer for the U.S. government.

The indictment alleges that the bankers, between February and August 2000, misled the former National Westminster Bank unit over the amount Enron was paying for a stake in "Swap Sub," an Enron entity used to hedge the energy trader's investment in Internet service provider Rhythms NetConnections.

The men argue they should be tried in Great Britain

more...

[KoKo]

47. "Kenny Boy" is going to whine....but you promised me.....you promised me..

I wouldn't go down...I wouldn't be prosecuted if I was a good little boy....you promised...YOU BETTER KEEP YOUR F*'n DAMN PROMISE...because what I know could bring your whole F'n Government down..HEAH that Boy?"

(psst..heard as a fly on the wall..)

[54anickel]

43. HEDGE FUNDS: Regulators to vote on plan to provide greater oversight

My bet - it ain't happening!!! In a pigs eye!!! This is the basis of the greater percentage of our "new economy"!

http://www.chicagotribune.com/business/chi-0406220321jun22,1,3344327.story?coll=chi-business-hed


WASHINGTON -- The Securities and Exchange Commission is moving ahead with plans to bring hedge funds under greater government oversight despite the opposition of most of the $800 billion industry.

SEC Chairman William Donaldson scheduled a mid-July meeting to vote on a plan that would require hedge fund managers to register with the agency, according to an e-mail sent by his office to SEC officials.

snip>

Criticism of the SEC's desire to oversee hedge funds has grown since the agency's staff last year issued a report calling for registration, which would allow SEC examiners to review the funds' books and conduct regular inspections.

Federal Reserve Chairman Alan Greenspan, New York Atty. Gen. Eliot Spitzer and Rep. Michael Oxley (R-Ohio), an author of the Sarbanes-Oxley corporate governance law, have all spoken out against greater regulation of hedge funds.

[54anickel]

44. Foreigners Put Dollars to Use

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

Did you catch this headline in last Friday's edition of The Wall Street Journal?: "U.S. Trade Deficit Isn't Likely to Devastate Dollar." That's the kind of man-bites-dog story we would ordinarily expect to find on the front page. Instead, it ran inside, tucked between a Porsche advertisement and a story about the passage of a corporate-tax bill. Perhaps the journal's editors were afraid to play it more prominently because, like me, they just didn't "get" it.

The story originated with two research organizations: the Conference Board and the clubby-sounding Group of Thirty. The gist of their findings is that foreigners use our dollars for so many different purposes that, even though we are running huge trade deficits with them, their insatiable demand for paper dollars to facilitate transactions has been helping to even things out.

Not Spooked

You might think foreigners would be spooked about hanging onto dollars, given the fact that they've been piling up in their trading coffers at a rate approaching $50 billion per month. So far, though, no such reaction has occurred. "While the dollar has fallen significantly against the euro and yen over the last year," notes the Journal, "its slide hasn't prompted a panicked flight from the greenback or dollar-denominated securities. Nor has the U.S. trade balance corrected itself." Talk about understatement.

The researchers says the apparent complacency of our trading partners is due to changes in the way they use dollars. "Instead of thinking of dollars as foreign currency, they think of them more as their own currency. The survey results imply a demand for U.S. dollars for transactions purposes that is to some degree independent of the economic fundamentals of the United States itself." And a good thing, too.

Seigniorage

Oddly, the report does not mention the word seigniorage, which is the free benefit the U.S. reaps when foreigners choose to hold surplus dollars as cash rather than as bonds on which we would have to pay them interest......


"Money for nothin, and the stuff's for free....."

"We gotta install microwave ovens
Custom kitchen deliveries
We gotta move these refrigerators
We gotta move these colour tv’s"

Now that ain’t workin’ that’s the way you do it
You play the Forex while the buck's empty
That ain’t workin’ that’s the way you do it
Money for nothin’ and your stuff's for free
Money for nothin’ and stuff's for free

[KoKo]

49. Did I read this correctly? An implication that "dollars" are replacing

gold as that stuff you put away for bad times? Holding dollars instead of bonds? :eyes: No...I think I must have read that one wrong...

[54anickel]

45. Global Investor Confidence Tumbles

http://biz.yahoo.com/rb/040622/markets_investors_confidence_1.html

LONDON (Reuters) - Global investor confidence fell in June, hitting a new 2004 low as institutions hunkered down in anticipation of the first U.S. interest rate hike in four years, State Street said on Tuesday.

The U.S.-based financial services firm said its State Street Investor Confidence Index slipped to a fresh 2004-low of 85.5 points in June, down 6.4 points, the sharpest monthly fall since February. The index is now at the lowest since October 1999.

snip>

State Street senior strategist Michael Metcalfe said comments from U.S. Fed chairman Alan Greenspan (News) earlier in June warning that it would act if necessary to ensure price stability have continued to hit confidence.

That is despite recent attempts by Greenspan and other U.S. central bankers to soothe worries about aggressively higher interest rates in the United States.

"The implication is that the Fed cannot afford to be complacent in its assumptions that financial market participants are ready to absorb significantly higher interest rates," said Metcalfe.

more...

[54anickel]

46. 11:45 heading into the lunch hour will the S&P get the boost it needs?

Gotta stay above last Monday's low at 1121.80, according to the INO blather.....

Dow 10,324.35 -47.12 (-0.45%)
Nasdaq 1,971.02 -3.36 (-0.17%)
S&P 500 1,126.18 -4.12 (-0.36%)
10-yr Bond 4.710% +0.020
30-yr Bond 5.391% +0.017


11:25AM: The market weakness today is commonly being ascribed to technical factors, which to some extent means there is no other strong reason for the move...one possible supportive sign for the day is that the SOX semiconductor index (SOX 454.58 +3.81) is higher...it is often seen as a key leadership sector for the overall market...it was even higher early this morning, and declined ahead of the overall market, but the gains today could ultimately prove supportive...the index has been on a downtrend since January...NYSE Adv/Dec 1078/1877, Nasdaq Adv/Dec 970/1802

10:55AM: Similar to yesterday, market sags a bit on little news...even though it is a week away, and there is an extremely strong consensus that a 1/4% move is what will be enacted, the Fed FOMC meeting next week is commonly mentioned as a top market concern...that reflects the lack of news available to support the market...NYSE Adv/Dec 1246/1617, Nasdaq Adv/Dec 1228/1472

10:30AM: Steady trade continues...focus is on the Fed's policy announcement a week from today...durable goods orders is the next potentially significant economic release, which is due on Thursday...Nasdaq held after approaching 50 and 200 day moving averages...decliners slightly lead advancing issues, and the Russell 2000 Index is down slightly, indicating that the broad market is soft along with the major averages...NYSE Adv/Dec 1240/1499, Nasdaq Adv/Dec 1223/1351

[54anickel]

50. Greenspan Proposes Changing National Motto To "In Fraud We Trust"

Someone set this old article up to float to the top in a google on Greenspan. Must be in honor of his reinstatement.

:evilgrin:

http://www.newshax.com/modules/news/article.php?storyid=461


Posted by spm on 2003/9/5 13:04:15 (527 reads)


WASHINGTON (NewsHax wire) -- Federal Reserve Chairman Alan Greenspan, befuddled by the impact of the corporate fraud upon the economy in the past few years, proposed to a Senate Committee, changing the national motto, currently inscribed on all United States coins, from IN GOD WE TRUST to IN FRAUD WE TRUST.

“Hopefully, such a move will have a similar impact to the speech given by stock speculator Ivan Boesky in 1985 stating that ‘greed is good,’ and help to restore the peoples’ confidence in the decision-making capability of America’s corporate leaders,” Greenspan said. (more...)

The motto IN GOD WE TRUST was originally placed on United States coins on November 13, 1861, largely because of the increased religious sentiment existing during the Civil War. Since 1938, all U.S. coins have had this motto inscribed on them. On July 30, 1956, the president approved a Joint Resolution of the 84th Congress, declaring IN GOD WE TRUST the national motto of the United States.

[54anickel]

51. Treasury's Snow to meet Brazil leader in New York (Looking for pointers

there John?) :eyes:

http://www.reuters.com/financeNewsArticle.jhtml?type=bondsNews&storyID=5484355

WASHINGTON, June 22 (Reuters) - U.S. Treasury Secretary John Snow will meet Brazil's President Luiz Inacio Lula da Silva in New York on Wednesday, a Treasury official said on Tuesday, without offering any details on their talks.
Lula, accompanied by Finance Minister Antonio Palocci, is leading a delegation to meet investors in New York, seeking to attract more foreign investment to Brazil.

Lula's government is losing popularity, according to a poll that showed its approval rating dropping to 29 percent in June from 35 percent in May.

On Tuesday, investors were watching to see whether Brazil's central bank would roll over almost $2.5 billion in dollar- linked securities maturing July 1.

[ozymandius]

52. Gotta run folks.

Thanks to everyone for this great discussion. Special thanks to the mystery donor who gave me a star!

See you in the morning!

Ozy :hi:

[54anickel]

53. Treasury secretary says to expect continued strong growth in economy, jobs

Why am I reminded of that StarTrek episode where Picard finally breaks under the pressure and screams, "I see four lights! FOUR lights!!!!"

Allen, Snow, stop, STOP already!!! I see an economic recovery!!! ReCOVerYYYYYYYYYY!!! ARRRRGH!!!!


http://www.wcfcourier.com/articles/2004/06/21/business/local/8b20002a10836eee86256eba0045ab5f.txt

WASHINGTON (AP) -- Treasury Secretary John Snow said Sunday he expects continued strong economic growth and "lots and lots of good jobs" created in the coming months.

At the same time, however, he said world affairs have so dominated the public's attention that the strong growth is not reflected in polls about President Bush's stewardship of the economy.

"There's been so much attention to other things, particularly the war in Iraq, that it's deflected attention from the economy," Snow said. "But the news on the economy ... is so good and so pervasive, so far-reaching, that I think people will change their views here."

The nine-month period that ended April 30 showed an annual growth of 5.5 percent in the gross domestic product, which measures the value of all goods and services produced in the United States. That was the strongest three-quarter growth in 20 years, Snow said on CNN's "Late Edition."

more...

[htuttle]

57. I see inflation!

Inflation!



:evilgrin:

[54anickel]

61. Thanks htuttle! That's the episode alright!

[54anickel]

54. DUPE!!!!

That's it for me. Too many ISP problems today. Will try to check back later.

[54anickel]

55. 2:21 Rally in the pits! Bargain hunters

Dow 10,365.20 -6.27 (-0.06%)
Nasdaq 1,983.37 +8.99 (+0.46%)
S&P 500 1,131.61 +1.31 (+0.12%)
10-yr Bond 4.703% +0.013
30-yr Bond 5.384% +0.010

NYSE Volume 885,485,000
Nasdaq Volume 1,092,612,000

2:00PM: Major indices improve their stance as the Nasdaq approaches its highs of the day... Like yesterday, today's trade has been relatively trendless with volume totals light for the session... Yesterday was actually one of the fifth lightest days for both the Nasdaq and NYSE as the summer doldrums and the impending Fed meeting/Iraq handover date (both next Tuesday) hang over the market... Today, volume has improved some with the Nasdaq having just crossed the 1 bln share mark...NYSE Adv/Dec 1307/1896, Nasdaq Adv/Dec 1352/1662
1:25PM: Earnings reports due after the close today include 3Com (COMS), Darden Restaurants (DRI), CKE Restaurants (CKR), and Christopher & Banks (CBK)...R.J. Reynolds (RJR 65.80 +1.49) stock spikes upward on Dow Jones newswire report that the Federal Trade Commission Chairman is skeptical of challenging the companies purchase of Brown & Williamson unit, but off its highs...NYSE Adv/Dec 1305/1834, Nasdaq Adv/Dec 1358/1642

12:55PM: Indices manage to build a bit on mid-day bounce as Nasdaq goes into the green...SOX semiconductor index (SOX 459.85 +9.08) holds solid gains...NYSE volume is on track for about 1.3 billion shares, another light day...NYSE Adv/Dec 1224/1885, Nasdaq Adv/Dec 1342/1646

12:25PM: Indices got a boost as the SOX semiconductor index (SOX 459.43 +8.66) rose, boosted by a move in Broadcom (BRCM 43.49 +0.84) during their conference call...but the mini-run hasn't yet shown any legs...NYSE Adv/Dec 1127/1957, Nasdaq Adv/Dec 1263/1699

[hang a left]

58. Bottom of page 2..........

wtf? kick

[Maeve]

59. Final with blather

Dow 10,395.07 +23.60 (+0.23%)
Nasdaq 1,994.15 +19.77 (+1.00%)
S&P 500 1,134.41 +4.11 (+0.36%)
10-Yr Bond 4.704% +0.014

Close: Stocks opened lower, and the continued selling from yesterday took the S&P Index hit -5.93 by mid-morning...then, the market turned around, and the S&P Index rallied over 10 points and closed near its highs of the day...all of this developed on very little news......semiconductor and telecom stocks rallied, and got credit for jump starting the market, but the action today simply left the major averages little changed for the week following yesterday's weakness...
in essence, today was largely a reversal of yesterday, and maintains the trading range mentality that has been in place for weeks...in the Dow, Wal-Mart (WMT 54.06 -0.87) was lower after a judge ruled a class action lawsuit could proceed, and DuPont (DD 44.00 -0.35) was down after a Wall Street Journal article said the US government might investigate chemical price fixing...Morgan Stanley (MWD 52.15 +0.90) and Goldman Sachs (GS 90.65 +1.86) were helped by strong earnings reports...attention remains on the Fed policy statement a week from today, as the economic and earnings calendar this week remains light...that also defines volume, which came in at only 1.38 billion shares on the NYSE...

bonds were slightly lower today, and crude oil futures bounced back $0.48 to $38.25 after falling $1.23 yesterday...
http://finance.yahoo.com/mo

[54anickel]

60. Hey Hey!!! Lookie there, quite the rally - well at least back into the

"trading range". Hmmm, another week of going nowhere, huh? So, why does the market even bother to open for business these days? :evilgrin: