STOCK MARKET WATCH, Friday 17 September

[ozymandius]

Friday September 17, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 125
DAYS UNTIL W* GETS HIS PINK SLIP 46
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 280 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 334 DAYS
WHERE ARE SADDAM'S WMD? - DAY 547
DAYS SINCE ENRON COLLAPSE = 1030
Number of Enron Execs in handcuffs = 19
Recent Acquisitions: Ken Lay
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

---

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

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AT THE CLOSING BELL ON September 16, 2004

Dow... 10,244.49 +13.13 (+0.13%)
Nasdaq... 1,904.08 +7.56 (+0.40%)
S&P 500... 1,123.50 +3.13 (+0.28%)
10-Yr Bond... 4.07% -0.10 (-2.42%)
Gold future... 406.50 -0.50 (-0.12%)





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 88.76 Change -0.03 (-0.03%)

http://futures.fxstreet.com/Futures/news/afx/singleNew.asp?menu=economicnews&pv_noticia=MTFH21415_2004-09-17_12-05-15_L17602442

FOREX-Dollar pauses, market looks ahead for Fed impetus

LONDON, Sept 16 (Reuters) - The dollar was hemmed in narrow ranges on Friday as investors tried to assess how quickly the U.S. central bank was likely to raise interest rates after a widely-expected increase next week.

The Federal Reserve is tipped to hike rates next Tuesday by a quarter-point to 1.75 percent in what would be its third rate rise in consecutive meetings.

The dollar was buoyed by robust economic data earlier this week but soft U.S. inflation and manufacturing activity indicators on Thursday have cast fresh doubt over whether the Fed will maintain its recent pace of monetary tightening.

"The Fed will really have to surprise the market to make a big move," said Niels Christensen, currency strategist at Societe Generale in Paris.

"But everything indicates it's going to be a similar statement to the last meeting. They will probably maintain that they are going to tighten at a measured pace ... There's no reason to rock the boat."

<snip>

Although many foreign exchange dealers expect rates to reach 2 percent by the year-end, U.S. interest rate futures markets have begun to price in the possibility the Fed may not raise rates at its policy meetings in November and December. The Fed does not meet in October.

<snip>

Speculation an upcoming G7 meeting could put pressure on Asia countries to revalue their currencies gave the Japanese currency a boost earlier in the week but dealers were keen to close positions ahead of the weekend.

...more...

http://futures.fxstreet.com/Futures/news/afx/singleNew.asp?menu=economicnews&pv_noticia=MTFH19826_2004-09-17_10-45-35_KEM721435

GLOBAL MARKETS-Shares firm as Treasury yields hit 5-month lows

LONDON, Sept 17 (Reuters) - Government bonds were in demand on Friday after weak economic data and firm oil prices provoked fresh insecurity about U.S. growth, leading investors to bet against aggressive interest rate hikes by the Federal Reserve.

Shares in Europe rose to 10-week highs, led up by mining stocks, after Wall Street ended with pared gains on Thursday and most Asian stock benchmarks ended the week on a down note.

Markets are still pricing in a 25 basis point U.S. rate rise next Tuesday, however, and currency traders appear relatively unmoved by the reduced yield potential, pushing the dollar down slightly but keeping it within its established trading ranges.

"The Fed's message is going to be quite important. They're going to continue to talk reasonably positively, they don't want to raise any doubts about the recovery, so they'll maintain that tone on Tuesday," said Ian Gunner, head of foreign exchange research at Mellon.

...more...

http://www.reuters.com/financeNewsArticle.jhtml?type=bondsNews&storyID=6257643

US Treasury's Snow repeats support of strong dollar

CINCINNATI, Ohio Sept 16 (Reuters) - U.S. Treasury Secretary John Snow on Thursday repeated the United States supports a strong dollar, following new data that fanned some concern about the nation's ability to attract foreign capital.

"Our policy on the dollar is well-known: we support a strong dollar," Snow told reporters after speaking to the Cincinnati Chamber of Commerce.

Earlier Thursday, a Treasury Department report showed the pace of foreign investment in the United States slowed in July, to $64.0 billion from a revised $74.0 billion in June.

...very short newsblurb...

http://www.iht.com/articles/539226.htm

Currencies: Philadelphia Fed data dismay, hurting dollar

NEW YORK The dollar fell Thursday after an index of Philadelphia-area manufacturing this month tumbled.

Traders hoped for a second strong regional factory report in two days, after the New York Federal Reserve Bank's similar index of New York state manufacturing surged Wednesday.

Instead, the Philadelphia Fed's index dropped to 13.4 for September, from 28.5 in August, significantly below most analysts' forecasts.

"Investors got excited yesterday after the Empire Manufacturing report and were expecting a stronger reading on the Philly Fed," said Brian Taylor, head currency trader at Manufacturers Traders Trust. "The number didn't come in that way, and immediately sellers got back in the market."

...more...

http://informationweek.com/story/showArticle.jhtml?articleID=47208542

Worries About A Slower Second Half Are Growing

Corporate forecasts are falling short and signals point to more-modest capital spending, intensifying worries of a slower second half.
By Meg Richards, Associated Press Business Writer








NEW YORK (AP) -- Stocks sagged Wednesday after Coca-Cola Co. and several other companies issued gloomy forecasts, and a lower-than-expected reading on industrial production for August threw the nation's broader economic outlook into question.

Adding pressure to technology shares, the Goldman Sachs Group lowered its rating on both hardware and software stocks based on its latest survey of corporate officers who oversee high-tech spending. With corporate forecasts falling short of expectations and a number of signals pointing to more modest capital spending, worries about a slower second half were intensifying, but analysts say it's really too soon to tell what lies ahead.

"We've been saying for a while that investors need to be much more selective ... this is a stock-picking kind of market," said John Caldwell, chief investment strategist for McDonald Financial Group. "It may be that Coke's problems are just Coke's problems. On the flip side of that, there are a number of companies out there that are saying relatively good things."

...more...

Have a Great Day Marketeers!

[ozymandius]

6. UIA, do you remember when...

Financial pontificators predicted a robust third and fourth quarter in market growth and corporate earnings? I believe that Snowjob was spewing some of his homegrown dimensia in that vein.

"Just you wait...prosperity is just around the corner-" "The next two quarters will realize 8% GDP growth or better-" were among the delirious nuggets of hope Snowjob espoused at campaign rallies disguised as economic forums.

[UpInArms]

13. their lies still ring in my ears, Ozy

http://money.cnn.com/2004/01/09/news/economy/jobs/

excerpt:

And while the economy grew at a blistering 8.2 percent rate in the third quarter -- and will probably grow a still healthy 4 percent or so this year -- businesses have been able to generate much of that growth by pushing their current workers harder and using technology to produce more efficiently.

<snip>

And more recently, Treasury Secretary John Snow suggested the economy could start adding 200,000 jobs a month as early as October 2003. So far, neither prediction has come anywhere close to true.

President Bush said that all signs pointed to strength in the economy. "I'm optimistic,'' the president told a forum on small business, according to Reuters. "All of the signs in our economy are very strong.''

Other administration officials called for making permanent the tax cuts passed in 2003.

Certainly, most economists believe stronger hiring will come in 2004, and the National Federation of Independent Business said Friday that its December survey of small businesses showed hiring plans at their strongest level since August 2000.

"To handle the rising level of spending in 2004, firms will have to increasingly rely on the addition of new workers -- job creation is about to ramp up," the NFIB said.

[ozymandius]

18. "Other administration officials called for making tax cuts permanent"

Other administration officials called for making permanent the tax cuts passed in 2003.

Not surprising that this comment comes from the wealthiest administration in U.S. history.

[UpInArms]

20. wonder what the 2003 tax cuts were?

http://jobwatch.org/

The Bush Administration called the tax cut package, which took effect in July 2003, its "Jobs and Growth Plan." The president's economics staff, the Council of Economic Advisers (CEA, see background documents), projected that the plan would result in the creation of 5.5 million jobs by the end of 2004 — 306,000 new jobs each month starting in July 2003. The CEA projected that the economy would generate 228,000 jobs a month without a tax cut and 306,000 jobs a month with the tax cut. Thus, it projected that 4,284,000 jobs would be created over the last 14 months. In reality, since the tax cuts took effect, there are 2,668,000 fewer jobs than the administration projected would be created by enactment of its tax cuts. The August job growth of 144,000 fell 162,000 jobs short of the administration's projection. As can be seen in the chart below, job creation failed to meet the administration's projections in 12 of the past 14 months.

[54anickel]

24. But, but "the tax cuts are working"! Just not quite the way the planned,

sort of like Iraq, Afghanistan, and every "plan" this boob-admin has implemented.

Not working out the way they planned? --- Or is it?

Guess that would depend on what the real objectives were. Can't believe there weren't "other" objectives all along. Why else would any idiot continue to push a plan through while the circumstances the decisions were based on were rapidly changing.

Oh yeah, I forgot - that's Shrubs quality of decisiveness. :eyes:

[ozymandius]

2. WrapUp by Martin Goldberg (Special Contribution by Sarel Oberholster)

Greenspan's Legacy? Worldwide Debt Folly
edited by Martin Goldberg

Similar to democracy, monetary freedom via central banking is a concept that only works with responsible participants. Without appropriate responsibility, we get anarchy. Governments have hijacked monetary freedom under the banner of good intentions, by claiming absolute right to the creation of money. Yet, wielding this power always requires more power and more wielding. With misguided citizens and irresponsible central banks, intervention breeds debt in the name of “economic stimulus”. This breeds more intervention and more debt. As I’ll describe in this article, the long-term world wide economic impact is likely to be astronomic.

A friend asked me whether excessively leveraged consumer mortgages are the reason for the red-hot real estate sector. It seems to be a straightforward answer to ascribe at least some blame to these geared mortgages, yet that would not be entirely true. I had to draw on my 27 odd years of experience in banking and my economic training to answer such a simple question truthfully. No. The real reason is the absence of market forces in the decisions regarding the amount of money in the world economy and the absence of market forces in establishing the price of money, interest rates, in the world economy. Both belong to government and central banks and, in this, Greenspan rules all. Here’s how.

-cut-

How much can I borrow? As much as you can afford to repay. The repayment amount is then calculated as a function of the interest rate and the term. Will a debtor in this controlled monetary environment be turned away for a lack of money? No. He who controls the price also controls supply and in today’s “accommodative environment” will provide whatever is called for. Here is the central banker’s and the debtor’s temptation all rolled in one. Drop the price of money low enough and debtors will foolishly demand almost unlimited amounts of debt. All that is left to do is to supply unlimited amounts of money. Is it the makings of an economic miracle or as I believe, an economic nightmare?

-cut-

Today’s Market from Martin Goldberg

The Case for Rally’s Near End

Having done some reading of financial periodicals such as Barron’s and watching business TV over the last 3 weeks or so, some common themes are apparent to me. Among them:

*Bush’s success in the polls is helping the stock market, and the stock market is helping Bush’s success in the polls.

*The stock market will be helped if the price of oil does not rise from its current levels.

*The market’s resilience in the face of lukewarm economic data and numerous earnings warnings from many company tethered to business fundamentals is a good sign for the longer term stock market.

*Many market technicians have discussed the intermediate trend of lower-lows and lower-highs in spite of the current month-old rally. (This almost begs a contrarian's view that the previous market’s (lower) high will at least be pierced upside.)

-more-

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

[UpInArms]

7. Sunny Fed leaves no doubt about another rate increase

http://www.bankrate.com/brm/news/bank/20040920a1.asp

Another Fed meeting looms with another quarter-point interest rate hike virtually assured. It may seem strange that the Fed continues to raise interest rates on the heels of a summer-long economic soft patch. However, the course has been set for recent Fed interest rate moves, and as far as the Sept. 21 meeting is concerned, the Fed has left little room for deviation from the current course.

Communication is a high priority at the Fed as they don't want to surprise financial markets when it comes to raising interest rates. So it is no accident that Greenspan sent a strong signal about the upcoming Fed meeting in testimony before the House Budget Committee on Sept. 8.

Greenspan was again optimistic on the economy, stating that the "expansion has regained some traction" and that "inflation and inflation expectations have eased in recent months." At that point, the intent to raise rates another quarter-point on Sept. 21 became clear.

Greenspan has expressed confidence in the strength of the economy before, during his July Humphrey Hawkins Congressional testimony and, along with other Fed governors, in prior Fed statements. While saying in each post-meeting statement since May 2003 that the upside and downside risks to economic growth and low inflation are roughly equal, Greenspan and Fed governors lately give little hint of any pessimism. Instead, the recent stance has been that any economic soft patch is temporary and largely attributable to sharp increases in energy prices.

Has this view been proven correct? It is too early to say, but there are other considerations.

...more...

Goldilocks Meanspin either doesn't have a clue or he is malevolent.

[ozymandius]

8. "We'll all be dead." - Bush on his historical legacy

It makes me wonder how many at the highest levels of Federal government think this way. Because Greenscam, already with one foot in the grave, appears totally unconcerned about his legacy as a bubble manager. Why should he care about traction in the economy? He has served most elegantly as an apologist of Bush I and II. The Clinton years saw him attempting to derail economic growth with higher and higher interest rates and cautionary rhetoric - despite the economy's own momentum.

I am grateful to be relatively young as this affords me opportunity to see his tenure at the Fed discredited as an exercise in economic piety.

[UpInArms]

3. Jaguar puts brakes on at historic plant

http://www.guardian.co.uk/business/story/0,3604,1306949,00.html

The halting of production at Jaguar's Browns Lane factory in Coventry, the birthplace of the British motor industry, marks the end of an era.

Much of the plant - which has featured prominently in the luxury maker's history - was destroyed in a disastrous fire in 1957, only six years after it was opened. But once it was rebuilt, Browns Lane went on to manufacture some of the world's most distinctive sports cars.

The sleek E-type Jaguar, one of the company's most successful cars, which became a symbol of the swinging 60s, was manufactured there, as was the "executives' favourite", the XJ6.

The first model to bear the Jaguar name - the SS Jaguar two-litre sports sedan - rolled off the production line in September 1935. William Lyons, who began his career in the motor industry by assembling motorcycle sidecars in a Blackpool garage, at first resisted the name Jaguar, when it was suggested by advertisers.

...more...

http://www.reuters.co.uk/newsPackageArticle.jhtml?type=businessNews&storyID=585527§ion=finance

Ford lifts profit forecasts

NEW YORK (Reuters) - Ford has raised its third- quarter and 2004 profit forecasts because of strength in its financial services business and cost improvements in its car operations.

Ford, which earlier in the day set plans to cut 1,150 jobs at its main Jaguar production facility in Britain, said on Friday it expects third-quarter earnings of 10 cents to 15 cents per share, up from a prior estimate of break-even to 5 cents per share.

For the full year, it expects to earn $1.90 to $2 per share, up from a previous estimate of $1.80 to $1.90.

The quarterly and annual estimates exclude any costs from the Jaguar actions and other special items.

...more...

http://www.thestreet.com/_tscbrk/stocks/automakers/10183348.html

Ford Repeats Guidance Trick

Ford's (F:NYSE - news - research) third-quarter earnings will be more than twice its old estimate thanks to strength in its lending arm. The automaker also outlined a restructuring of its Jaguar unit that will result in $450 million of pretax charges over two years, reducing 2004 net income by 25 cents a share.

The No. 2 automaker expects to earn 10 cents to 15 cents a share before nonoperating items in the third quarter, up from its old estimate of breakeven to earnings of 5 cents a share. Analysts, who have consistently low-balled Ford's earnings over the last two years, this time had their forecasts on target. The consensus prediction for Ford's third quarter was for earnings of 10 cents a share, according to Thomson First Call.

Ford's estimate Friday is almost identical to a preannouncement it released ahead of its second-quarter earnings. Fourteen days before that quarter ended, Ford said second-quarter earnings would be 45 cents to 50 cents a share, not the 30 cents to 35 cents a share it had previously forecast. It cited strength in its finance division.

...more...

[UpInArms]

4. August chip equipment orders fall

http://money.cnn.com/2004/09/17/technology/chip_equipment.reut/

SAN FRANCISCO (Reuters) - North American semiconductor capital equipment manufacturers reported that orders fell in August after nearly a year of growth, a U.S. trade group said Thursday, adding that orders may weaken further in coming months.

Orders for equipment used to produce microchips reached $1.52 billion in August, down 5 percent from July, Semiconductor Equipment and Materials International said in a monthly update.

Orders were still more than double the same month last year, when the chip industry ordered $731.8 million in equipment.


Billings, or shipments, were $1.51 billion in August, down 1 percent from July and up 90 percent from a year earlier. The ratio of orders to shipments, known as the book-to-bill ratio, was 1.00 in August, meaning that for every $100 of products shipped, an equal amount of new orders were received.

...more...

[UpInArms]

5. Japan shuts Citigroup private bank operations

http://www.reuters.co.uk/newsPackageArticle.jhtml?type=businessNews&storyID=585513§ion=finance

TOKYO (Reuters) - Japan has ordered the commercial banking unit of Citigroup to close its Japanese private banking offices, shutting it out of the lucrative business and prompting the second apology this week from the bank's international operations.

The Financial Services Agency (FSA) ordered Citibank to suspend operations at a branch in Tokyo and three satellite offices in Osaka, Nagoya and Fukuoka as of September 29.

Citibank then has one year to terminate accounts at the offices, at which point their licenses will be revoked.

The bank may apply for new licenses to continue its private banking operations at other locations, but the punishment effectively forces it out of the industry in Japan.

Regulators said they had found a long list of problems at the private banking operation, including failing to prevent suspected money laundering, lax screening of customer information and improper trading practises.

...more...

[ozymandius]

9. That hurts.

Isn't Citibank in cahoots with Riggs over money laundering in this country and hiding Pinochet's weighty accounts?

[UpInArms]

17. why, yes! Citibank was one of the banks named

http://www.pressaction.com/news/weblog/full_article/hand09152004/

Investigators have discovered that Pinochet held at least five secret bank accounts in the United States in addition to the eight discovered at Riggs Bank in Washington. The accounts were opened by Pinochet under his own name and those of two of his children, Lucia and Marco Antonio, in four other U.S. banks, including Citibank in Miami. The accounts were discovered by the U.S. State Department during its investigation of Pinochet’s accounts at Riggs Bank.

[54anickel]

25. I was wondering what Japan was going to do. I am relieved to see

that Japan does still value honor and ethics after all. After the article early in the week, (stated this wasn't the first time this had happened) I was concerned that the Japanese were accepting crooked dealings as minor, common occurences. Sort of like the US does.

[ozymandius]

10. Consumer Prices Climb; Jobless Claims Up

WASHINGTON - Consumer prices barely budged in August, suggesting that inflation isn't currently a problem for the economy and Federal Reserve (news - web sites) policy-makers can stick with a gradual approach to raising interest rates.

The government's closely watched inflation barometer, the Consumer Price Index (news - web sites), rose by just 0.1 percent in August from the previous month, the Labor Department (news - web sites) reported Thursday. Falling prices for clothes, cars and airfares helped to temper rising prices for medical care, education and some food items.

story

[MARALE]

19. Okay

I usually just read, but this really bothers me. Prices for things that are essential for a strong future and a strong country are rising, and prices for things we don't really need are falling. This country does not have the right priorities. I am really burned up this is not bigger news than this.

[ozymandius]

11. Treasury Yields Hold at Lows Before Data

NEW YORK (Reuters) - Treasury yields held near five-months lows on Friday as the market digested recent hefty gains while awaiting a key reading on the U.S. consumer.

The benchmark 10-year note tacked on another 2/32 in price gains, nudging yields down to 4.06 percent having already dropped almost 10 basis points on Thursday.

Traders said speculators were now eyeing a break of 4.00 percent in the hope of forcing mortgage funds to buy Treasuries to hedge against prepayment risk.

story

[54anickel]

27. Think the bond market is giving Greenspin ulcers yet? n/t

[ozymandius]

12. Dividend Funds Enjoy Best of Times

Rewarding shareholders the old-fashioned way -- with dividends -- has made a comeback, thanks largely to investor tax breaks enacted in 2003.

But will presidential politics and federal budget constraints quickly lead to higher dividend tax rates again, just as dividend-paying stocks are getting some respect?

If ever there was a time for dividend stocks to shine, it's now, when rising interest rates are dampening the markets, and a company's genuine ability to generate cash flow every year produces real value for investors.

http://www.thestreet.com/funds/annperry/10183114.html

[ozymandius]

14. U.S. stocks set to open higher on Ford's raised outlook

NEW YORK (CBS.MW) -- U.S. stock futures are indicating a higher open Friday after Ford eased investor concerns about the outlook for corporate earnings by raising its third quarter and full-year forecasts.

-cut-

"The market is going to open higher," said Paul Mendelsohn, chief investment strategist at Windham Financial Services. "Ford's news was very positive. It took the market by surprise."

Mendelsohn said Ford's revised outlook and today's options-related expiration activity seem to be putting a floor on the declines seen earlier in the week.

story

Hasn't Ford consistently lost market share in auto sales over the past three quarters?

[UpInArms]

15. pre-opening blather

briefing.com

9:12AM: S&P futures vs fair value: +3.0. Nasdaq futures vs fair value: flat. Near the end of pre-market trading, it now looks like a mixed start for the indices... QCOM's raised Q4 and FY04 outlook has proven to be a mixed bag - the company announcing it plans to review its ongoing Accounting Method for royalties in addition.

8:55AM: S&P futures vs fair value: +3.3. Nasdaq futures vs fair value: +4.0. Futures indications continue to boast moderate gains, signaling a higher open for the indices... Better than expected earnings reports from CC and CCL have contributed to the positive bias, along with healthy gains seen in Europe (France's CAC 40 +1.0%).

8:32AM: S&P futures vs fair value: +2.9. Nasdaq futures vs fair value: +3.5. Still looks like a higher open for the indices as the futures trade holds most of its gains... News that TXN boosted its annual dividend and announced a $1 bln share buyback has increased interest in tech - which looks to lead the market in the early action.

8:03AM: S&P futures vs fair value: +3.2. Nasdaq futures vs fair value: +3.0. Futures trade pointing to a higher open in response to the gains seen in the European bourses and a number of positive earnings pronouncements (including F this morning).

ino.com

The December NASDAQ 100 was higher overnight as it extends this week's breakout above the 50% retracement level of the June-August decline crossing at 1420.59. However, stochastics and the RSI are overbought and are turning bearish hinting that a short-term top might be near. Closes below the 10-day moving average crossing at 1412.50 would signal that the rebound off August's low has come to an end. The December NASDAQ 100 was up 2.50 pt. at 1428 as of 5:44 AM ET. Overnight action sets the stage for a steady to firmer opening by the NASDAQ composite index later this morning.

The December S&P 500 index was higher overnight due to short covering as it consolidates above the 10-day moving average crossing at 1122.84 and the 75% retracement level of the July-August decline crossing at 1125.15. If the rally continues, a test of gap resistance crossing at 1131.19 is December's next upside target. However, stochastics and the RSI are overbought and are turning bearish signaling that a short-term top might be in or is near. Closes below the 10-day moving average crossing at 1122.86 would signal that a short-term top has likely been posted. Overnight action sets the stage for a steady to firmer opening when the day session begins later this morning.

[ozymandius]

16. Casino is open for bidness

9:32
Dow 10,270.67 +26.18 (+0.26%)
Nasdaq 1,906.31 +2.23 (+0.12%)
S&P 500 1,125.98 +2.48 (+0.22%)
10-Yr Bond 4.083% +0.014

[UpInArms]

21. Consumer sentiment sinks in early Sept., UMich says (95.8)

http://cbs.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38247.4100925926-820867547&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (CBS.MW) -- Consumer sentiment eroded slightly in early September, according to researchers at the University of Michigan. The consumer sentiment index slipped to 95.8 from 95.9 in August. The increase was below the consensus forecast of Wall Street economists who had expected sentiment to improve to 96.5.

Headline was a bit over the top - but the fact is that the index failed to rise as predicted.

[UpInArms]

51. US Sept Consumer Sentiment Stagnates

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6267492

NEW YORK (Reuters) - U.S. consumer sentiment stagnated in early September as doubts about the economy and the job market persisted, a report indicated on Friday.

The University of Michigan's index of consumer confidence moved lower to a preliminary reading of 95.8 from 95.9 in August, according to sources who saw the subscription-only report. Analysts had looked for a rise to 96.5.

U.S. economic growth weakened in the second quarter and forecasters are now trying to determine whether that softness was transitory or marked the start of a longer-term trend.

The answer to that question will determine the pace at which the Federal Reserve is likely to raise interest rates, with widespread implications for consumers and businesses.

<snip>

"The continued weakness in a number of components of the index suggests that it's more than just high oil prices that are ailing the economy," said Lakshman Achuthan, managing director at ECRI.

...more...

a better article regarding today's tealeaf reading

[UpInArms]

22. 10:07 EST numbers and blather

Dow 10,260.56 +16.07 (+0.16%)
Nasdaq 1,897.69 -6.39 (-0.34%)
S&P 500 1,124.93 +1.43 (+0.13%)
10-Yr Bond 4.074% +0.005

10:00AM: Major indices dip off their opening highs following the weaker than expected preliminary Michigan Consumer Sentiment report... The September index declined 0.1 to 95.8 (consensus of 96.8) as the current conditions portion fell 2.1 points and the expectations component increased 1.2 points... Still, the reading is within the range seen over much of the year... The only real areas to get hit with selling are tech in nature, along with brokerage, airline, and retail... Energy, industrial, and consumer staple are still boasting large gains and keeping the S&P 500 afloat... NYSE Adv/Dec 1605/984, Nasdaq Adv/Dec 1126/1124

9:45AM: Stock market starts the day with modest gains, prompted by a number of positive corporate news announcements... Earnings this mornings have been positive - with notables such as Circuit City (CC 14.59 +0.48) turning in a better than expected Q2 (Aug) report and Ford (F 14.37 +0.42) raising its Q3 (Sept) and FY04 (Dec) EPS outlook... Texas Instruments (TXN 21.93 +0.34) also boosted its annual dividend and announced a $1 bln stock buyback in the latest wave of tech dividend announcements...

The market will get its sole economic report of the morning with its preliminary September Michigan Consumer Sentiment reading at 9:45 ET... The consensus estimate stands at 96.7...

[UpInArms]

23. Economy: Unctad Warns of Threats to Global Recovery

http://allafrica.com/stories/200409170007.html

The current recovery of the global economy is dampened by risks that could give rise to financial and exchange-rate instability and to a slowdown in growth, the United Nations Conference on Trade and Development (UNCTAD) warned Thursday.

Unequal distribution of demand, the impact of the rise in oil prices and pressures on the U.S. dollar are the factors threatening the global recovery, according to the annual report signed by the U.N. body's outgoing secretary- general, Rubens Ricupero.

<snip>

The ECLAC expert underlined the increased regional autonomy of Asia, whose economies no longer depend as heavily on exports to the United States as they did before the southeast Asian crisis that broke out in 1997, and whose effects continued to be felt until 2000.

In their attempt to prevent a repeat of that meltdown, the economies of Asia, including China, have followed expansive fiscal and monetary policies, accumulating reserves in dollars through high interest rates and exchange rates fixed at competitive levels.

<snip>

"In 2003, East Asian developing countries, including China, bought more than 210 billion dollars in foreign currency, as against the U.S. budget deficit of 455 billion dollars and the U.S. trade deficit of 490 billion dollars," says the report.

"In practice, developing countries are financing the U.S. deficits," said Ramos.

<snip>

UNCTAD warns that this situation is unlikely to be sustainable in the long- term, and that pressures could be expected to lead to a strengthening of the Chinese yen and other Asian currencies, and to the corresponding devaluation of the dollar, which could in turn generate exchange-rate and financial imbalances and inflationary pressures.

...more...

[UpInArms]

26. 10:59 EST numbers and blather (the sky is the limit!)

Dow 10,309.60 +65.11 (+0.64%)
Nasdaq 1,910.11 +6.03 (+0.32%)
S&P 500 1,129.99 +6.49 (+0.58%)
10-Yr Bond 4.106% +0.037

10:30AM: Equity market remains relatively unchanged, the blue chip averages outperforming the Nasdaq... The Composite has been hurt by selling in pockets of technology, such as networking, disk drive, and communication equipment... The latter has dropped following a Lehman Brothers downgrade of Cisco Systems (CSCO 19.18 - 0.41) to Equal Weight from Overweight due to 'mixed trends in August'... Semiconductor has also been held back by an announcement from Qualcomm (QCOM 38.20 -2.20)...

The licenser of CDMA technology increased its Q4 (Sept) and FY04 estimates, but then added it was reviewing the way it reports license royalties, saying it may change its accounting policy to record royalties as revenue...NYSE Adv/Dec 1268/1542, Nasdaq Adv/Dec 914/1656

[UpInArms]

28. Murdoch's American dream bad for investors

http://www.theage.com.au/articles/2004/09/17/1095394003049.html?oneclick=true

The proposed transfer of News Corporation's domicile to Delaware will probably occur after this week's lukewarm endorsement from News' independent expert, Grant Samuel. Local shareholders, however, could lose significantly in the transition.

There are two broad elements to the proposal that remain contentious with local institutional shareholders and that could yet cause problems for the scheme, which requires approval from 75 per cent of the shareholders, other than the Murdoch family, who will vote at the scheme meeting.

One relates purely to the market impacts of the transition and the exit of News from local sharemarket indices, which will affect all fund managers with Australian share mandates and prompt a wave of forced selling over News' nine-month phased withdrawal.

The other element flows from the radically different governance environment in Delaware. News shareholders will have much less protection than they have under Australian corporate law and regulation. That is causing some consternation among the funds.

<snip>

It is, as indicated, probable that the transfer of domicile will be endorsed by shareholders. Rupert Murdoch generally gets what he wants and it appears News believes it has sufficient support from its US shareholder base and elsewhere to get the proposal across the line.

...more...

[54anickel]

29. Complacency and the Rain Dance for Money

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=36048

One has to appreciate, in theory and in practice, Alan Greenspan’s genius, at least in the Machiavellian sense, and how it has been used in the financial markets to drive the real economy. Indeed, many notable economists, financial market participants and the press, are now acknowledging how the Fed has used asset bubbles in stocks, bonds, and housing to facilitate the continued household spending of borrowed money. This has created a false sense of wealth and has kept the economy rolling with no savings.

What is becoming crystal clear is that if the United States’ bond and stock markets suddenly “re-priced to fair value”, the world would witness a crash in stocks, bonds, housing prices and the dollar. This inevitable re-pricing, caused by unsustainable Treasury and Trade deficits, will be fiercely and politically delayed, at all costs, until after the November election. Also, the extent to which the Treasury and Fed can use legal but undisclosed Exchange Stabilization Policies is not widely understood by the financial markets.

More importantly, while the magnitude of aid – amounting to $1.3 Trillion – given to America’s financial markets by foreign central banks has been disclosed, it is not appreciated that these holdings will most likely keep US Treasury rates 3% lower than they would be if the Treasury needed to fund its deficits within the US.

Evidence of the government’s “active hands” in the markets continues to grow. First, there is the manipulation of the gold market that has been solidly documented but not widely disseminated in the press...

snip>

Second, evidence also appears in the stock market’s strange but predictable behavior. Whenever the markets look like they are about to crash, major buying suddenly appears at the regular scheduled times during the day to keep the stock indexes from breaking down below major psychological barriers. It always looks like a major player has stepped in with an unlimited checkbook. In reality, the checkbook is a printing press owned by the Fed that can flood the market with REPO funds, and allocate a few billion to have market agents buy stock futures to smooth the market out.

more...

[UpInArms]

30. this week's checkbook offerings

http://www.321gold.com/fed/temp_bank_res.html

The Desk has entered the market announcing: O/N RP
The Desk has entered the market announcing: 6-day RP
The Desk has entered the market announcing: 14-day RP
Fed's Daily Securities Lending
Thu 09/16/04
$8.250 billion
$4.000 billion
$13.00 billion
$1.300 billion

The Desk has entered the market announcing: O/N RP
Fed's Daily Securities Lending
National Debt $7,353,679,708,420.92 treas.gov
Wed 09/15/ 04
$7.000 billion
$1.450 billion
.

The Desk has entered the market announcing: O/N RP
Fed's Daily Securities Lending
National Debt $7,372,477,498,441.96
Tue 09/14/04
$6.750 billion
$1.903 billion
.

The Desk has entered the market announcing: O/N RP
Fed's Daily Securities Lending
National Debt $7,371,695,470,163.46
Mon 09/13/04
$6.000 billion
$2.196 billion
.

[54anickel]

32. Yes, it's been rather amazing to watch the repos lately. I've noticed

an increase not only in amounts, but also in the frequency of the overnight repos over the past few months.

Hard to believe they've only been issued to maintain bank reserves. There's just not THAT much lending going on, is there? :shrug:

[UpInArms]

34. I think that most of that "lending" is on the

US taxpayers' backs



The estimated population of the United States is 294,297,202
so each citizen's share of this debt is $25,071.81.

The National Debt has continued to increase an average of $1.69 billion per day since September 30, 2003

[wasp in a wig]

71. That number doesn't appear to be accurate

Do you know how that figure is calculated ? Because the treasury website says that the current national debt stands at

$7,347,867,800,168.01

for 9/16/04.

Not that it still isn't a really huge number, I just don't understand why it's different from the actual number, since it seems pretty precise.

[54anickel]

72. Your's appears to be yesterday's total.

These figures are from the 13th and adds the repos for that day. How's bout that, it actually went down for a change.

http://www.brillig.com/debt_clock/

This debt clock is maintained by Ed Hall ([e-mail]). It was last calibrated using information obtained from the U.S. Department of the Treasury dated 13 September 2004. Population figures are derived from the U.S. Bureau of the Census' Population Clock.


Repos:
http://www.321gold.com/fed/temp_bank_res.html

[54anickel]

35. Did you catch this part in the article regarding "politics & the Fed"?

Snip>

...So, what must the Fed hope for and encourage? From their perspective, the best thing would be for a massive stock market rally to occur in anticipation of a Bush re-election. However, with rising interest rates and a slowing economy - the peak having already passed in the corporate earnings cycle – a stock market rally is unlikely with stock and bond prices currently at record levels. So, the best outcome is boredom and complacency in the bond, stock, and currency markets. The key to engendering complacency is engineering low volatility - the Fed’s gift to the White House. With low volatility and high complacency, the stock market looks just as safe as an insured FDIC bank CD.

[UpInArms]

39. interesting combination: low volatility and high complacency

http://www.falkland-malvinas.com/Detalle.asp?NUM=4262

The global financial system is stronger than at any point since the stock market bubble burst in 2001, the International Monetary Fund said on Wednesday, in spite of interest rate increases by the US Federal Reserve.

Short of a big, devastating geopolitical incident or terrorist attack that had a lasting impact on consumer and investor confidence, "it is hard to see where systemic threats could come from in the short term", the IMF reported in its twice- yearly Global Financial Stability Report.

It said that a combination of stronger global growth, improved risk management by banks and other financial institutions, and the Fed's emphasis on clear communication had meant that banks were able to withstand the rise in the federal funds rate without a "visible impact on their profitability".

The Fed raised rates by a quarter point in June and August, and is expected to do so again next week, bringing the federal funds rate to 1.75 per cent. It is expected to continue raising rates in quarter point increments at a pace dictated by economic data.

"Market preparedness for stands in stark contrast to the surprise and volatility that accompanied the Fed's tightening in 1994," the report said.

However, it noted the risk that a further rise in oil prices could stoke inflation concerns or dent economic growth, with knock-on effects for financial markets.

The report also warned about investor complacency, following the smooth adjustment to higher rates in the US.

"This may be reflected in the low volatility observed in major stock and bond markets", it said.

"Such complacency could lead to a return of indiscriminate risk behaviour, due to a strong tendency to 'search for yield'".

Global current account imbalances pose a risk to financial stability, the report said, although it added that it was difficult to forecast how or when the financing of the current account deficits could become disorderly.

...more...

this article also seems to answer your Meanspin and the funds question.

[54anickel]

43. Interesting if you try to read between the lines -

"it is hard to see where systemic threats could come from in the short term"

Do they see some problem in the long-term, though?

Global current account imbalances pose a risk to financial stability, the report said, although it added that it was difficult to forecast how or when the financing of the current account deficits could become disorderly.

Hard to forecast how or when - sheesh they seem pretty damn sure about the IF don't they? Appears to be a given.

In the absence of a compelling alternative it was not easy to see why investors would trigger a wholesale shift away from liquid dollar assets, the report said.

Heh-heh, no compelling alternative to the US buck - yes and it's taken an awful lot of manipulation and intervention to keep anything from rising to the status of compelling alternative, no?

[KoKo]

37. UIA..your link also had Fleckstein's interesting comments about Bush/polls

economy. The link at the top.

http://moneycentral.msn.com/content/P92948.asp

Housing: a reprieve from reality
Folks who've been paying attention know the economic data have been slipping since last spring. Considering this fact, I would have expected (and did expect) that the dollar would be under more pressure than it has been -- and stocks might be, too. Therefore, it has taken longer for the "next time down/post-stimulus" trade to start working. I've been wondering why, and in particular why the dollar has hung in there as it has.

My conclusion is related to why I think President Bush has been able to hold his position in the polls, despite what's happened on the economic front. (This is an economic comment, not a political one, as I am not a fan of either Bush or Kerry.) The housing market has been holding up. That’s made people feel good, and the byproduct of the housing-as-ATM-funding vehicle has continued to help them live beyond their means.

I may be totally wrong about this, but I think that housing has enabled people to feel better about the economy and where we're headed than my reading of the data suggests would be possible.

That said, given the early signs of trouble building, I still believe that the economy, the stock market and the Fed's credibility are on borrowed time. The problems that I have outlined in the past about the next time down/post-stimulus trade await us in the future. However, this scenario appears to have taken longer to unfold than I would have guessed, based on the data.
http://moneycentral.msn.com/content/P92948.asp

[UpInArms]

42. hanging onto one's home is one of the most

instinctive things for people.

As long as that illusion remains, the clapping for tinkerbell will continue.

[KoKo]

45. "clapping for Tink...." that's a good one.

:D

[UpInArms]

46. I first started using that

analogy back in the RayGun era - it has re-emerged with the fiscal policies of this mal-administration. This one is RayGun's policy on steroids. :(

[UpInArms]

31. August Book-to-Bill Drops to 1.0, SEMI Reports

http://www.reed-electronics.com/electronicnews/article/CA453987\

Reflecting the recent cut revenue expectations and lowered analyst forecasts, North American semi equipment manufacturers reported a book to bill ration of 1.0 with $1.52 billion in orders for August on a three-month average basis, down 5 percent from in July, according to SEMI.

<snip>

“Semiconductor equipment bookings and billings for North American-based suppliers have declined slightly from peak levels in the past few months, yet remain at high levels (each above $1.5 billion). A number of recent company announcements suggest these levels may continue to soften in the coming months," said Lubab L. Sheet, research development director at SEMI, in a statement. "However, we believe the industry is on track to exceed our overall worldwide forecast projection of $36 billion this year.

...more at link...

[ozymandius]

33. 11:40 numbers and blather

Dow 10,294.25 +49.76 (+0.49%)
Nasdaq 1,908.23 +4.15 (+0.22%)
S&P 500 1,128.61 +5.11 (+0.45%)
10-Yr Bond 4.108% +0.039

U.S. stocks gain on positive corporate newsflow

NEW YORK (CBS.MW) -- U.S. stocks gained ground Friday as Ford's upbeat outlook, positive analyst comment on General Electric and Texas Instruments' $1 billion share buyback plan offset concern over a surprise dip in consumer sentiment and a rise in oil prices.

-cut-

The options-related expiration activity, known as quadruple witching, is when contracts for stock index futures, stock index options, stock options and single stock futures all expire. It occurs on the third Friday of March, June September and December.

Crude higher

Taking some of the shine off Ford's upbeat outlook was a fresh rise in oil.

Crude futures moved closer to $45 a barrel in early trading as the industry continued to take stock of the extent of the damage caused in the Gulf of Mexico by Hurricane Ivan.

story

I gotta run outside for awhile. My son and I need to run an errand. I hope to see you all later. In any case, have a wonderful weekend!

Ozy :hi:

[UpInArms]

36. bye Ozy! Have a Great Weekend!

:hi:

[54anickel]

38. Study: Fed's Unusual Strategy Worked

It's all just a friggen mind-game to these people. :grr:

http://www.nytimes.com/aponline/business/AP-Fed-Study.html

snip>

The policy makers decided at that point to stop cutting interest rates. They switched instead to a strategy that Bernanke and his colleagues call ``policymaking by thesaurus.'' For the first time in its history, the Fed began to make public statements about how it might change interest rates over a horizon beyond six to eight weeks.

On Aug 12, 2003, the Fed's monetary-policy committee announced that it believed ``the risk of inflation becoming undesirably low is likely to be the predominant concern for the foreseeable future. In these circumstances, the Committee believes that policy accommodation can be maintained for a considerable period.''

For the next five months, the committee retained the ``considerable-period'' promise. Then it began to tinker with the language, making subtle changes that slowly altered the meaning of the promise.

In late January 2004, the Fed's Open Market Committee dropped the phrase ``considerable period'' and replace it with an assurance that the Fed could be ``patient in removing its policy accommodation.'' In May, the language shifted again -- the committee said it believed policy accommodation could be removed ``at a pace that is likely to be measured.''

In their study, Bernanke and his co-authors provide hard evidence that the Fed's ability to steer the economy often depends far more on what it says than on what it does with interest rates. Moreover, they say, the Fed's ``considerable-period'' maneuvers had an even bigger effect on longer-term interest rates than previous statements of the FOMC.

``Shaping investor expectations through communication does appear to be a viable strategy,'' Bernanke and his co-authors, Vincent Reinhart and Brian Sack, concluded.

[UpInArms]

40. back to the Contract on America - and now the Agenda on America

http://www.fair.org/extra/9502/language-control.html

"Language: A Key Mechanism of Control"

excerpt:

In fact, the new speaker of the House--who once described his goal as "reshaping the entire nation through the news media" (New York Times, 12/14/94)--has given a great deal of thought to the media and how to manipulate them. One Newtonian axiom is "fights make news." (Boston Globe, 11/20/94) Another skill he has taught to Republican candidates through his political organization, GOPAC, is how to create a "shield issue" to deflect criticism:

"A shield issue is just, you know, your opponent is going to attack you as lacking compassion," a GOPAC training tape advises. "You better find a good compassion issue where, you know, you show up in the local paper holding a baby in the neonatal center, and all you're trying to do is shield yourself from the inevitable attack."

But the clearest expression of Gingrich's philosophy of media came in a GOPAC memo entitled "Language: A Key Mechanism of Control." Distributed to GOP candidates across the country, the memo's list of words for Democrats and words for Republicans was endorsed by Gingrich in a cover letter: "The words in that paper are tested language from a recent series of focus groups where we actually tested ideas and language." Next time you hear Gingrich complain about media focusing on the negative, refer back to these lists.

...more (including a list of words)...

[54anickel]

49. HAHA! "I wish I could speak like Newt." Man, hard to believe anyone

would wish for that! Sad commentary on our citizens if speaking like that idiot is considered desirable and necessary to win votes, isn't it?

[UpInArms]

50. a race to the bottom of the barrel

of rotten apples :evilgrin:

[54anickel]

41. ACK!!! The arrogance of these "things" - Last paragraph

Those maneuvers had other salutary effects as well, the study says. They ``reduced the volatility'' of public expectations of Fed policy, allowing investors to make more accurate guesses about the timing and magnitude of Fed interest-rate changes. They even taught investors how to accurately adjust their expectations in response to new economic data.

[UpInArms]

44. Bernaise - the father of public relations

had a lot to teach fascists:

http://www.abc.net.au/rn/talks/8.30/mediarpt/stories/s903570.htm

Sheldon Rampton: One of the fascinating things to me about the public relations industry, and one of the reasons that I was interested in writing this book in fact, is the public relations industry has always grown side by side with military propaganda. The people who founded a public relations industry, the man who today is known as The Father of Public Relations, is a guy named Edward Bernaise, and he got his start doing propaganda on behalf of the Administration of Woodrow Wilson to support US entry into the First World War. A lot of the techniques that have been developed to encourage us to buy everything from automobiles to slap, have been developed initially by people whose job was to figure out how to influence the thinking of populations during wartime, and I think that’s contributed greatly to the development of a propaganda model of communications that affected us in a lot of ways that aren’t directly related, or are not seen to be directly related to wars.

http://polit.com.ua/?lang=eng&cgid=5&mpid=16&poid=2&id=578

excerpt:

And finally I’d like to represent one historical experience just to “dethrone” a next-in-turn myth about imperfect moments of PR activities. In 1929 the USA celebrated 50th anniversary of a famous inventor and entrepreneur Edison. A lot of famous Americans, including the President Hoover took part in the celebration. E. Bernaise was the author and the producer of the celebration. But he was not aimed just to jubilee stuff. He had more serious task – an exploitation of historical anniversary of Edison to make benefits for “General Electric” company, directly related with Edison. That time US Congress deputies often went at the company because it had monopolized the production of electrical lamps and dictated its own conditions at the market. Bernaise decided to change the negative attitude towards the company and to create an appropriate publicity through creation of positive informational image. It’s natural, that the anniversary was represented in mass media in great degree and the desired result was achieved very soon. After the holidays US governing circles and publicity changed their attitude towards “General Electric” company comparatively with their attitude before the celebration. The result was further development of the company. The dream came true. PR works.

[KoKo]

47. It's that old "Repeat the Lie often enough and people will believe it"

thingy.... P.T. Barnum must be chuckling away in his grave....:crazy:

[UpInArms]

48. and Hitler is dancing in his grave

http://www.disinfopedia.org/wiki.phtml?title=Big_lie

Hitler writes in Mein Kampf (James Murphy translation, page 134):

"All this was inspired by the principle - which is quite true in itself - that in the big lie there is always a certain force of credibility; because the broad masses of a nation are always more easily corrupted in the deeper strata of their emotional nature than consciously or voluntarily; and thus in the primitive simplicity of their minds they more readily fall victims to the big lie than the small lie, since they themselves often tell small lies in little matters but would be ashamed to resort to large-scale falsehoods. It would never come into their heads to fabricate colossal untruths, and they would not believe that others could have the impudence to distort the truth so infamously. Even though the facts which prove this to be so may be brought clearly to their minds, they will still doubt and waver and will continue to think that there may be some other explanation. For the grossly impudent lie always leaves traces behind it, even after it has been nailed down, a fact which is known to all expert liars in this world and to all who conspire together in the art of lying. These people know only too well how to use falsehood for the basest purposes.

[KoKo]

52. My hope is that the "lie" at some point becomes so agregious that the

disconnect becomes too painful at some point for the "people" to ignore. Whatever event that precipitates this awakening then will bring out the "peasants with the pitchforks" to bring the monsters down.

Who knows where this will come from and if the "peasants with the pitchforks" will be our own American Citizens, or will come from somewhere else,(as Nazi Germany was brought down by Allies against it). But it will come. I see rumblings out there in the hundreds of thousands of demonstrators who have taken the time to try to do something, I see it here on the internet where we have so many questioners from so many different backgrounds across the country.

The overwhelming greed of these people has caused an imbalance that will be tipped back. At least that's my read of history. sigh....

Sorry for the pontificating rant...

[UpInArms]

54. I, too, await the cognitive dissonance

moment, Koko -

It cannot happen a moment too soon (imho).

Keep ranting :thumbsup:

[UpInArms]

53. 12:38 EST numbers and blather

Dow 10,296.40 +51.91 (+0.51%)
Nasdaq 1,907.78 +3.70 (+0.19%)
S&P 500 1,129.21 +5.71 (+0.51%)
10-Yr Bond 4.104% +0.035

12:30PM: Major indices continue to trade in moderately higher territory as buyers remain a fairly active bunch... Right now, the Nasdaq and S&P 500 are on track for a higher close to the week (the Dow still has 20 points to go)... The higher finish would mark the 6th straight week of gains for the S&P 500 - although most of these have been slim at best...

The market has begun to recover from the summer sell-off that left it at yearly lows as more investors have been encouraged by the lack of terrorist activity at events such as the Olympics, and been more willing to use dips as a buying opportunity...NYSE Adv/Dec 1693/1414, Nasdaq Adv/Dec 1380/1494

12:00PM: The market has put together a respectable advance this morning, bolstered by gains in Europe and upside earnings announcements from names like Carnival Corp (CCL 48.57 +0.52), Circuit City (CC 14.79 +0.68), and Ford (F 14.21 +0.26)... Investors have used the good news - particularly in a week better known for its warnings - as a reason to send stocks higher... Texas Instruments (TXN 21.78 +0.19) also announced a 17% increase to its annual dividend and a $1 bln stock buyback, which has raised interest in semiconductor...

That has only been partially offset by news that Qualcomm (QCOM 38.76 -1.64) is reviewing the way it reports license royalties (the company also raised its Q4 and FY04 guidance this morning)... Despite this, semiconductor has moved 1.4% higher and found among its ranks biotech, transportation, and energy... The latter has advanced on the heels of a 2% price climb in crude oil - off news Yukos is close to declaring bankruptcy and Ivan's damage to the Gulf Coast....

[54anickel]

55. HEDGE FUNDS TO SEC: WHO MADE YOU BOSS?

Me thinks that thou protest too much...

http://www.nypost.com/business/28732.htm

September 17, 2004 -- A powerful association of hedge funds fired another shot in its battle against government regulation.

The group slammed the Securities and Exchange Commission, saying the nation's top stock market cop does not have the legal authority to regulate hedge funds — private investment pools that cater to the super-rich.

"The SEC has anti-fraud authority over investment advisers, registered or unregistered," said Jack Gaine, president of the Managed Futures Association, the group representing the funds. "But I do not think they have the authority to do what they propose."

snip>

The SEC has insisted that the growth of the hedge fund industry, the rising incidence of fraud in it and the increasing availability of hedge funds to mom and pop investors requires it to collect more information on the funds and more actively regulate them.

The SEC plan said regulation of the funds was "inadequate" and relied too much on action taken after a fraud had occurred.

snip>

"I don't know why with 94 million investors in the mutual fund industry and who knows how many people trading on public exchanges, and millions of mom and pop investors, the SEC is giving so much attention to what is essentially an institutional market place," Gaine told The Post.

[54anickel]

56. Here's what happens if you don't play the credit game

http://www.chron.com/cs/CDA/ssistory.mpl/business/2799710

snip>

The problem is that Bensema has no recent history of borrowing money and paying it back. That means he has no verifiable credit and a minuscule credit score. In citing its reason for denying him a better rate, his insurer listed the reason as "total credit less than optimum."

snip>

For people like Bensema who live outside the credit nation in which so many of use are mired, scoring amounts to an unfair penalty.

It imposes rules of a game they have refused to play.

Now those ratings are affecting not only our ability to go further into debt but to get basic services such as telephones and electricity. In some cases, employers use them to evaluate job applicants.

snip>

On Friday, the Federal Trade Commission said Sprint and AT&T agreed to pay almost $1.5 million to settle charges that they failed to notify applicants for phone service that credit reports were used.

You'll notice that the phone companies got spanked for not telling potential customers about the practice, not for the practice itself.

The justification for using credit scoring for non-credit purposes is that there's a "correlation" between our credit histories and other behavior, like filing fewer auto claims. Bensema is proof those correlations are flimsy suppositions.

more...

[54anickel]

57. 1:42 and buyers are beginning to slack

Dow 10,271.92 +27.43 (+0.27%)
Nasdaq 1,904.37 +0.29 (+0.02%)
S&P 500 1,126.54 +3.04 (+0.27%)
10-yr Bond 4.106% +0.037
30-yr Bond 4.907% +0.031
NYSE Volume 865,117,000
Nasdaq Volume 1,055,599,000

1:30PM: Market gives up a noticeable portion of its gains as the price of crude oil hits new highs at $44.95/bbl... The commodity is now up more than 2% as US companies begin to assess the damage from Ivan and worry about Yukos - Russia's largest exporter... On its conference calls this morning, the company noted its high cash burn rate and said it was putting off paying taxes so they have money on hand to run operations...
The company has been on the verge of bankruptcy for some time and has been at odds with the government, and Briefing.com has tracked its progress on the Daily Sector Wrap (archives dated July 30)...NYSE Adv/Dec 1705/1455, Nasdaq Adv/Dec 1353/1569

12:55PM: Plus signs continue to abound as up volume leads down volume at the NYSE and Nasdaq... Very few sectors are not finding buying interest at this stage as the uptick remains fairly uniform... One of the groups that is not, however, is managed care... The group has been under pressure as of late, and today Barron's Online published a piece that says net profit margins could fall next year as the spread between premium rate hikes and medical cost trends narrow... Rate increases have been slow, and although medical loss ratios have remained at low levels, this could be enough to crimp net income...NYSE Adv/Dec 1760/1374, Nasdaq Adv/Dec 1395/1499

[UpInArms]

58. GE ready to sell India BPO ops

http://timesofindia.indiatimes.com/cms.dll/html/uncomp/articleshow/854688.cms

WASHINGTON: General Electric Co (GE), which began business process outsourcing to India long before the term became familiar and the issue a hot button one, is planning to sell its India operation.

The price tag: $1 billion.

GE is in talks to sell all or part of GE Capital International Services, or GECIS as the division is known, the Wall Street Journal reported on Friday.

Started in 1993 in Delhi-Gurgaon as part of GE Capital, the division employs nearly 17,000 people and had revenues of $400 million.

It is described as the largest BPO operation in India by a foreign company.

The move does not mean GE is backing down from its professed goal to continue outsourcing, the report said. Instead, it reflects GE's desire to profit from some of its investments in India.

The parent company will also save money by freelance outsourcing instead of having a captive unit.

...more...

[KoKo]

65. hmmm says either GE is going to find cheaper employees outside India

or their investors are sick of GE's stock price languishing. I couldn't understand from the article just what a BPO is but GE Capital does alot of mortgage and temporary building financing and they sold one of their US units off this Spring.

:shrug:

On Edit: In a related article found BPO=Business Processing Outsourcing.. GACK! I hate acronyms...especially when the article just assumes one "knows.."

[54anickel]

59. Ex-CEO of Enterasys Pleads Guilty

Sad, I have a friend that works for this company and some experience with their products. Their products are very good, just having a hard time competing with the likes of Cisco. These idiots seem to be getting off pretty easy compared to the havoc they've created in the lives of the employees, shareholders and customers.

http://www.cfo.com/article.cfm/3215044/c_3215051?f=home_todayinfinance

Enrique "Henry" Fiallo, the former chief executive officer of Enterasys Networks, has pleaded guilty to a federal charge of conspiracy to commit securities, mail, and wire fraud, the Associated Press reported.

According to prosecutors cited by the AP, Fiallo participated in accounting fraud that was designed to inflate the company's revenues to meet Wall Street projections but that eventually cost the networking company at least $20 million.

Fiallo made his guilty plea in U.S. District Court in Concord, New Hampshire. Enterasys, now headquartered in Andover, Massachusetts, was based in Rochester, New Hampshire at the time of the fraud. Fiallo is scheduled to be sentenced on December 17; he could receive up to five years in prison and a $250,000 fine.

In August, former Enterasys vice president Gail Spence Luacaw pleaded guilty to conspiracy to commit securities fraud; in May, ex-assistant controller Anthony Hurley and onetime executive Gary Workman pleaded guilty to wire fraud. Former Enterasys chief financial officer Robert Gagalis and former senior vice president for finance Bruce Kay have pleaded not guilty to federal charges and face trial in October.

[54anickel]

60. Productivity Endgame?

http://www.morganstanley.com/GEFdata/digests/20040917-fri.html#anchor0

Long ago -- way back in the late 1980s -- no one really cared about productivity. Now, of course, the world has come full circle in realizing that productivity is the Holy Grail of any economy. It not only plays a critical role in shaping business profitability, inflation, and interest rates, but it is key to competitiveness and real wages -- important building blocks of any nation’s standard of living. Rapid productivity growth and high-performance economies go hand in hand. Low productivity growth, by contrast, has a corrosive impact on economic performance. As everyone also knows, America is riding the crest of eight years of spectacular productivity growth -- an outcome that most believe has now become a permanent feature of the US economic landscape. Yet behind the scenes lurk some disquieting signs on the productivity front. Could it be that the days of rapid productivity growth in the US economy are finally nearing an end?



For starters, incoming data point to anemic productivity growth in the current quarter. By our latest estimates, GDP growth -- a good proxy for the output that drives the numerator in the productivity equation -- appears to be rising at about a 4% annual rate in 3Q04. At the same time, hours worked in the private economy -- a good proxy for the labor input that shows up in the denominator in the productivity equation -- is on track to rise at about a 3.25% annual rate. Moreover, with the headcount of self-employed workers likely to increase at close to a 15% annual rate in the current quarter, there is good reason to believe that growth in total hours worked could easily be in excess of 3.5%. Consequently, the gap between output growth and the increase in labor input -- a close approximation of productivity growth -- appears to be no higher than 0.5% in 3Q04. If that estimate is even close to being accurate, it would mark the weakest productivity gain of this recovery -- well below average annualized gains of 4.5% recorded over the first 11 quarters of this upturn.



By sector, the bulk of the slowing appears to be concentrated in the services sector. At least, that’s the implication I draw from labor market data that are pointing to relatively brisk increases in hours worked in information services, professional and business services, and the education and healthcare sectors. By contrast, the manufacturing productivity story remains impressive. The manufacturing piece of industrial production appears to be on track for a 6.0% annualized growth rate in the current period, well in excess of the 2.8% annualized increase in factory hours worked. Given the intrinsic labor-intensive bias of white-collar functions, the services sector is usually the first to fade on the productivity curve. Incoming data do little to dispel that historical pattern.



Alas, no serious student of productivity would ever generalize on the basis of results in any one quarter -- even a downshift as sharp as that which is now unfolding. After all, productivity is a broad measure of the efficiency of an economy’s overall production technology. As such, it hardly turns on a dime. Quarterly trends in productivity can often be volatile, especially since they are measured largely as a statistical residual between growth in output and labor input. In addition, the rhythm of productivity cycles typically follows a very predictable pattern: Big gains normally occur in the early stages of recovery, when businesses doubt the improvement in demand and hold the line on hiring and other costs. But then productivity growth usually slows once recovery expectations firm up and companies commit to expansion programs and job creation. Such a cyclical slowing of productivity growth is the rule, not the exception, as recoveries make the transition to expansion. If that’s all that’s going on today, why worry?


more...

[54anickel]

61. Washington Agreement update (Gold-buggy)

Central Banks to announce Gold sales
The 2004 Central Bank Gold Agreement

http://www.gold-eagle.com/editorials_04/phillips091604.html

The Central Banks involved in the 2004 Central Bank Gold Agreement are to announce the amounts of gold they intend selling under this agreement at the I.M.F. meeting early October.

At present they have already agreed that there will be a 'ceiling' of 500 tonnes of gold sold per annum under this agreement. We have been led to believe that this is the amount that will be sold each year. However, announcements made subsequently, have not confirmed that this amount will, in fact, be sold. Since the agreement was announced earlier this year, the market has been waiting expectantly for confirmations of further sales. As of this moment intended sales may well fall short of the 500 tonne ceiling.

The "Washington Agreement" is due to terminate on the 26th of September this year and the new agreement will come into force thereafter. These announcements we believe will demonstrate the continued value of gold in the reserves of the European Banks, despite these sales. It may well be that these announcements confirm our expectation of lower sales than the 500 tonnes but imply that the sales that do take place will be conducted in such a way as to stabilise any overheated market. A look at the present situation leads us to expect certain likely announcements in October, in Washington at the I.M.F. annual meeting.

more...

[UpInArms]

62. off topic: Former Sara Lee executive missing since Tuesday

http://www.usatoday.com/news/nation/2004-09-17-missing-exec_x.htm

GREENVILLE, S.C. (AP) — Investigators searched Friday for a former top executive at Sara Lee Corp. who disappeared after he went to meet a couple about buying his sport utility vehicle.

"There's a strong possibility of foul play," sheriff's spokesman Sgt. Shea Smith said Friday.

James Cockman, 71, was last seen Tuesday morning when he bought a cup of coffee at a convenience store near a lot where he was to meet the couple, sheriff's officials said.

His wife, Cathy Cockman, said he did not mention the couple's names to her but they paid him a $100 down payment on the SUV and he had gone to collect the remaining $8,400.

...more...

Now who would give someone their vehicle (worth $8,500) for only $100 and then go after the rest later?

[54anickel]

67. Weird...maybe it was just pocket change to him. Who knows, you

wouldn't think a former exec would be that trusting, but he was 71. Probably believed in the old idea that a person was good for their word.

Sad. Hope he's OK.

[54anickel]

63. 2:43 - Have the 2:00pm fairies arrived again?

Dow 10,282.69 +38.20 (+0.37%)
Nasdaq 1,908.23 +4.15 (+0.22%)
S&P 500 1,128.55 +5.05 (+0.45%)
10-yr Bond 4.114% +0.045
30-yr Bond 4.913% +0.037
NYSE Volume 1,010,483,000
Nasdaq Volume 1,202,223,000

2:30PM: The stock market continues to head slightly lower, although the speed of the decline remains slow... Crude oil has continued to surge, now up 4% for the day at $45.60/bbl... Traders continue to buy October contracts ahead of the weekend, as they anticipate further supply disruptions (Yukos, Hurricane Jeanne, problems in the Mideast) down the road... Equities have understandably not responded well to this, particularly in an afternoon in which not much is going on...
In other markets, treasuries have been moderately lower today as investors have taken profits from the area's large run-up this year - the yield on the 10-year note coming close to falling below the 4.0% level...NYSE Adv/Dec 1704/1511, Nasdaq Adv/Dec 1389/1596

2:00PM: Equities continue to deteriorate as the Nasdaq begins to approach the unchanged mark... Selling has become more pronounced in networking, disk drive, and electronic manufacturing service and threatened the Composite's lead... The blue chips have also dropped as selling has cropped up in influential areas such as retail, basic material, and brokerage... Volume has actually run stronger today as compared to other Friday sessions - which is probably the result of today's quadruple witching... That in itself has kept trading conditions fairly volatile...NYSE Adv/Dec 1692/1483, Nasdaq Adv/Dec 1342/1606



Advances & Declines
NYSE Nasdaq
Advances 1649 (48%) 1358 (42%)
Declines 1559 (46%) 1628 (51%)
Unchanged 170 (5%) 188 (5%)

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

Up Vol* 552 (57%) 628 (53%)
Down Vol* 382 (39%) 493 (42%)
Unch. Vol* 25 (2%) 42 (3%)

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

New Hi's 174 128
New Lo's 11 29

[UpInArms]

64. you can almost set your clock by it

2:49

Dow 10,293.53 +49.04 (+0.48%)
Nasdaq 1,910.10 +6.02 (+0.32%)
S&P 500 1,129.29 +5.79 (+0.52%)
10-Yr Bond 4.114% +0.045

[54anickel]

66. Hmmm, options expiring - another of those witchy thingys

U.S. stocks pare gains as oil rises more than 3 percent

http://biz.yahoo.com/cbsm-top/040917/71f91c5667ac7db74b55bba339c9705a_1.html

NEW YORK (CBS.MW) -- U.S. stocks traded higher but off their best levels Friday as rising crude-oil prices capped gains sparked by a raft of positive corporate news including a raised third quarter and full-year outlook from Ford.

snip>

"Ford's news was very positive. It took the market by surprise," said Paul Mendelsohn, chief investment strategist at Windham Financial Services.

Mendelsohn said Ford's revised outlook and Friday's options-related expiration activity seem to be putting a floor on the declines seen earlier in the week.

The options-related expiration activity, known as quadruple witching, is when contracts for stock index futures, stock index options, stock options and single stock futures all expire. It occurs on the third Friday of March, June September and December.

[54anickel]

68. FBI: Mortgage Fraud Is Rampant in U.S.

http://asia.news.yahoo.com/040917/ap/d855h7ig0.html

Fraud is running rampant in the nation's mortgage industry, with nearly three times as many reports of suspicious activity so far this year compared with 2001, a top FBI official said Friday.

"It has the potential to be an epidemic," said Chris Swecker, FBI assistant director for criminal investigations.

Through the first nine months of 2004, mortgage companies and banks have reported more than 12,100 instances of suspicious activity compared with only 4,220 in 2001. The FBI currently has 533 pending mortgage fraud investigations, compared with 102 in 2001.

Law enforcement officials say the lending and refinancing boom that accompanied record low interest rates in the past few years is a key reason for the increased fraud. The FBI has identified several "hot spots" around the country where fraud is especially prevalent, including Florida, California, Nevada, Michigan, Missouri and Illinois.

[54anickel]

69. Copper Heads for 2nd Weekly Gain in London as Hedge Funds Buy

http://quote.bloomberg.com/apps/news?pid=10000086&sid=atwZeWdJMM8E&refer=latin_america

Sept. 17 (Bloomberg) -- Copper futures rose to a one-month high in London, heading for their second weekly gain as hedge funds bought metal amid falling inventories and forecasts of a deficit.

Stockpiles monitored by the London Metal Exchange dropped 3.6 percent this week to 102,850 metric tons, less than three days' global demand. China, the world's biggest consumer, will use 12 percent more copper this year in products like electrical cable and water pipes.

``It appears that the funds are building fresh longs,'' Martin Fewings, an analyst at Mitsui Bussan Commodities Ltd. in London, said in an e-mailed note.

snip>

Hedge funds and other speculators pushed commodities prices to multiyear highs this year. Copper closed at an eight-year high of $3,030 a ton on the LME on March 1 and crude oil reached a record $49.40 a barrel in New York on Aug. 20. The Dow Jones Industrial Average of stocks, by comparison, has fallen 2 percent this year.

``Relative to other markets, commodities look to have attractive properties,'' Michael Lewis, head of commodities research for Deutsche Bank AG, said Wednesday at a conference in London.

[54anickel]

70. Closing

Dow 10,284.46 +39.97 (+0.39%)
Nasdaq 1,910.09 +6.01 (+0.32%)
S&P 500 1,128.55 +5.05 (+0.45%)
10-yr Bond 4.127% +0.058
30-yr Bond 4.917% +0.041
NYSE Volume 1,439,752,000
Nasdaq Volume 1,640,369,000

Close: The market came away with modest gains today - ones that were subject to wide swings in response to the quadruple witching options expiration... Still, the indices maintained a positive bias throughout the day that resulted from a wave of upbeat earnings announcements... In contrast to the warnings seen most of the week, Circuit City (CC 14.72 +0.61), Carnival Corp (CCL 48.30 +0.25), Ford (F 14.22 +0.27), and Qualcomm (QCOM 38.83 -1.57) released upside earnings results that inspired buyers to dabble in stocks...
Texas Instruments (TXN 22.08 +0.49) also appeased market bulls by upping its annual dividend by 17% and initiating a $1 bln stock buyback plan... As a result, semiconductor was one of the leading names of the day, and found support in biotech, industrial, and energy... The latter's movement, however, was a bit of a double-edged sword as it resulted from the 4% hike in the price of crude oil, to $45.59/bbl... The commodity climbed higher during the day as damage from Hurricane Ivan was assessed and Yukos - Russia's largest oil exporter - revealed it was close to bankruptcy...

Another factor that limited the indices' upside was the September Michigan Consumer Sentiment index... The preliminary reading dropped 0.1 points to 95.8 (consensus of 96.7) as the current conditions portion fell 2.1 points and the expectations component increased 1.2 points... Not surprisingly, growth-oriented stocks - like retail, airline, and brokerage - were some of the weakest areas...SOX +1.9, NYSE Adv/Dec 1695/1586, Nasdaq Adv/Dec 1558/1518

3:30PM : The late-day advance comes to a bit of a halt, as stocks fall off their afternoon highs... That being said, the market is still modestly higher which is good enough for its second day of gains... Industrial, energy, biotech, and semiconductor have emerged as the biggest winners of the session, with brokerage, airline, and managed care coming in as the weakest sectors... Upbeat corporate news has been responsible for the positive tone, although the 4% spike in the price of crude oil has stymied a certain amount of enthusiasm...

The simultaneous expiration of four different types of expirations has also added to the volatility...SOX +1.6, NYSE Adv/Dec 1737/1493, Nasdaq Adv/Dec 1409/1618

2:55PM : The choppy afternoon of trade continues, as the indices suddenly accelerate after two hours of declines... As it stands now, the Dow, Nasdaq, and S&P 500 are making a run at their best levels as they have jumped 24, 6, and 2 points, respectively, in the past half hour... It's hard to say if this rally will hold- as no trend (aside from a slightly positive bias) has held throughout the day due to the options expiration - but it is an encouraging sign for the bulls... Next week will provide the market with many tests, as the brokerages will report and the FOMC meets on Tuesday...

A 25 basis point increase, to 1.75%, is still expected despite yesterday's relatively benign inflation data... NYSE Adv/Dec 1639/1568, Nasdaq Adv/Dec 3196/1613