STOCK MARKET WATCH, Wednesday 20 July

[ozymandius]

Wednesday July 20, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 185 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 212 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 276 DAYS
DAYS SINCE ENRON COLLAPSE = 1333
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54


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




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90

AT THE CLOSING BELL ON July 19, 2005

Dow... 10,646.56 +71.57 (+0.68%)
Nasdaq... 2,173.18 +28.31 (+1.32%)
S&P 500... 1,229.35 +8.22 (+0.67%)
10-Yr Bond... 4.19% -0.03 (-0.81%)
Gold future... 420.20 -0.80 (-0.19%)

GOLD, EURO, YEN, Dollars and Loonie




PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Ike Iossif

THE TECHNICAL PICTURE

I apologize for the short commentary, but this week I am traveling, and thus, I have to write this while I am on the go.

-cut past lotsa charts-

Yesterday, we got the pullback we talked about last week, and now the question is whether the TOs continue lower implying lower prices, or we get a bounce from current levels as we did 5 weeks ago. Judging from today's action, the latter is more likely.

Summary

We got remarkable divergences between all indicators and price suggesting lower prices. However, the most important indicator of all is price itself and it hasn't even broken support while most indicators are at the point that usually marks a bounce! The odds are even between a re-acceleration to the upside, and further price deterioration.

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

[ClintonTyree]

2. Will the selection of Roberts............

for SC Judge have any effect on the Street? They HAVE to love this guy, he's pro-corporation all the way. I doubt there's anything he wouldn't do environmentally to aid big business. "Clear cutting, relaxation of pollution laws, what do you 'fellas want, I'm here to help ya'."
The Street must be happy with the idea of this guy ruling in their favor for the next 30 years or so. :shrug:

[ozymandius]

17. too early to tell

The confirmation process has yet to start. After looking at the DU homepage's listing of his opinions, there is quite a bit to digest. Sure, he's an industry shill. But the fact that he dissented on the Cheney energy task force case surely gives corporatocracy a free pass.

[UpInArms]

64. Supreme Court pick has won major cases for Toyota, Fox

http://www.marketwatch.com/news/story.asp?guid=%7BA51DA263%2D0387%2D4E48%2DA973%2D01424E0E091E%7D&siteid=mktw

WASHINGTON (MarketWatch) - In selecting John Roberts as his Supreme Court nominee, President Bush appears to have found a candidate that will please business interests.

Roberts, 50, practiced telecommunications, energy and other business law at Hogan & Hartson, the prestigious Washington law firm, from 1986 to 1989 and again from 1993 to 2003.

He won a Supreme Court case for Toyota (TM: news, chart, profile) in 2002, after an assembly line worker developed carpal tunnel syndrome and tendonitis in her neck and arms. She sued the company but the court ruled her injuries weren't covered by the Americans With Disabilities Act.

The decision won praise from business leaders, who argued too many borderline lawsuits are filed by people not entitled to ADA coverage.

Roberts also represented Fox Television (FOX: news, chart, profile) (NWS: news, chart, profile) in its successful challenge to the federal government's broadcast ownership rules, and served as counsel for the Associated General Contractors of America when the group argued unsuccessfully against an affirmative action program.

"He has an understanding of the impact of regulation and litigation on businesses," said Glenn Lammi, chief counsel of the legal studies division at the Washington Legal Foundation, a conservative group. "He has a limited-government view of things."

...more...

Yep. I'm certain the "business community" is excited. :eyes:

[54anickel]

3. 401(k)'s to take place of traditional plans

http://www.chicagotribune.com/business/chi-0507200163jul20,1,4786119.story?coll=chi-business-hed&ctrack=1&cset=true

Hewlett-Packard Co. has joined a long line of companies trying to cut costly pension obligations that originated in another era.

snip>

In 1979, 61 percent of employees with pensions were on a defined-benefit plan, but by the late 1990s that had dropped to 13 percent, according to an analysis by the Center for Retirement Research at Boston College.

The biggest reason for the decline, companies contend, is that the plans have too many uncertainties: The vagaries of stocks and other investments change the amount--anywhere from zero into the billions--that businesses must contribute to their pension funds in a given year.

snip>

Companies have more recently shifted that uncertainty onto employees, such as with 401(k) plans in which workers get a defined contribution they are responsible for investing.

snip>

All this can become a drag on earnings in an ever-more lean and competitive marketplace in which younger, smaller rivals do not carry pension responsibilities. (Of course, when investments were skyrocketing in the go-go 1990s, surplus in many companies' pension funds helped pad the bottom line.)

more...

[54anickel]

4. Haier Group Drops Bid to Buy Maytag

http://www.latimes.com/business/la-fi-maytag20jul20,1,7010025.story?coll=la-headlines-business

Maytag Corp., which is the subject of a bidding war, said Tuesday that Haier Group of China and two partners had dropped their bid for the U.S. appliance maker.

snip>

The group's decision came as Maytag rival Whirlpool Corp. prepared a $17-a-share bid for the company, valuing it at $1.3 billion.

In addition, a group of investors led by Ripplewood Holdings has a $14-a-share offer in place that values Maytag at $1.12 billion.

Haier, Bain and Blackstone had indicated to Maytag that they were interested in offering $16 a share for the company.

bit more...

[54anickel]

5. China 2nd-Qtr Growth Unexpectedly Accelerates to 9.5%

http://www.bloomberg.com/apps/news?pid=10000080&sid=aU8us90oN6qo&refer=asia

snip>

July 20 (Bloomberg) -- China's economic growth unexpectedly picked up in the second quarter as exports surged and investment in power plants, coal mines and other fixed assets gathered pace.

Gross domestic product rose 9.5 percent from a year earlier after climbing 9.4 percent in the first quarter, the National Bureau of Statistics said in Beijing. That beats the median 9.2 percent gain forecast in a Bloomberg News survey of 13 economists.

Expansion in China, the world's fastest-growing major economy, is being sustained by a widening trade surplus and infrastructure spending as Premier Wen Jiabao restricts investment in real estate, steel and cement to prevent overcapacity and falling prices.

``This strong growth rate is not a concern, it's in line with the
long-term trend of 9.4 percent since economic reform began in the late 1970s,'' Julian Jessop, chief international economist at Capital Economics in London, said ahead of today's announcement. ``The headline rate is less important than the prospect that the government is rebalancing growth away from wasteful investment toward net exports and consumer spending.''

snip>

While expansion in the government's targeted industries is being reined in, Premier Wen is encouraging investment in infrastructure to help ease shortages of power and transport and that's benefiting companies including General Electric Co., which makes power turbines, trains and aircraft engines. The world's biggest company by market value said second-quarter revenue from China rose 40 percent, twice as fast as its European sales.

more...

[54anickel]

7. China Debt Ratings Raised to A- by Standard & Poor's (Update4)

http://www.bloomberg.com/apps/news?pid=10000080&sid=awfY.Ku7V29M&refer=asia

July 20 (Bloomberg) -- China's foreign and local currency debt ratings were raised by one level to A- by Standard & Poor's, which cited government efforts to overhaul Asia's second-largest economy.

``The government's aggressive restructuring of its financial sector combined with improved profitability of the state-owned enterprises'' prompted the upgrade, Standard & Poor's said in a statement in New York. Hong Kong's foreign-currency rating was also raised one level, to AA-.

snip>

``Standard & Poor's expects China's leadership to maintain a measured and incremental approach in dealing with the current debate over its exchange-rate policy to preserve its export competitiveness without provoking retaliatory sanctions from its major trading partners,'' the statement said.

The yield on China's dollar-denominated bond due in October 2013 fell 1 basis point to 4.80 percent as of 10:02 a.m. in Hong Kong, according to data compiled by Bloomberg. The price of the 4.75 percent bond rose 0.085, or 85 cents per $1,000 face amount, to 99.629.

The extra yield, or spread, investors demand to hold the security instead of like-maturity U.S. Treasuries narrowed to 65 basis points from 66 basis points yesterday. It has contracted from 76 basis points on June 1. A basis point is 0.01 percentage point.

more...

[54anickel]

14. The China-CAFTA connection

Sorry about the source, and for the record I think most of this is BS, but it's good to see ANYTHING that will stop CAFTA.

http://washingtontimes.com/commentary/20050719-093627-2855r.htm

snip>

The sticking point are Republican members concerned not only with the mounting trade deficit, which will likely top $700 billion this year, but the lack of action by the administration against the largest bilateral part of the trade imbalance, China. The issue is not just economics, but national security, as Beijing uses the gains from trade -- the inflow of capital and technology -- to support a foreign policy agenda that threatens major U.S. national interests.

CAFTA proponents have tried to square the circle by arguing it is part of an anti-China strategy. The agreement will supposedly create a trade bloc that will protect infant industries of Central America from Chinese competition so democratic governments can put down roots. This harkens back to the Caribbean Basin Initiative during the Reagan administration. CBI used trade preferences to strengthen anti-communist regimes against Soviet-fomented revolutions.

Last month Robert Zoellick, the U.S. Trade Representative who negotiated CAFTA, wrote in The Washington Post that a CAFTA defeat would send "jobs in apparel production and similar industries to China." New USTR Rob Portman in the Wall Street Journal wrote, "The trade agreement will allow us to compete more effectively with China."
The discussion of trade blocs and geopolitics is a refreshing advance over the usual rhetoric of "free trade," but is it credible? The political question is whether those making the argument are sincere. The technical question is whether CAFTA would create a trade bloc strong enough to fend off the Chinese. Unfortunately, the answer to both is no.

CIA Director Porter Goss has warned Beijing is tilting the Asian balance of power against the U.S. Defense Secretary Donald Rumsfeld made the same case in congressional testimony and at a June 4 international conference in Singapore. Yet, administration policy has been weak.

more...

[54anickel]

18. U.S., Others Agree to Rework CAFTA Rules

http://www.latimes.com/business/la-fi-cafta20jul20,1,13701.story?coll=la-headlines-business

The U.S. trade representative's office, which had refused to amend the U.S.-Central American Free Trade Agreement, received a letter from the ambassadors of the six CAFTA nations agreeing to prohibit the use of non-U.S. pockets and linings in duty-free apparel from the region, House of Representatives Ways and Means Committee Chairman Bill Thomas (R-Bakersfield) said Tuesday.

CAFTA would end tariffs on more than $33 billion in goods traded between the U.S. and Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. It also would do away with a requirement that shirts, trousers and other items from the region can enter the U.S. duty free only as long as they are made from yarn or fabric produced in the U.S.

In a letter to Rep. Bob Inglis (R-S.C.) on Monday, Thomas pledged to push legislation through Congress that would change that, maintaining requirements on the pockets and linings being made in the U.S.

snip>

Democratic opponents of CAFTA criticized the new textile agreement, saying the Bush administration is unwilling to push for improving labor rules in the agreement in order to get broad bipartisan support, but is willing to change a small element on textiles in order to round up a few Republican votes.

"If they could do it for pockets and linings, I would hope they could do it for something as important as the core rights of workers," ...

more...

:eyes: Guess that explains their dropping the Free-trade line of BS. Free-trade? My ass - more special interest group crap - round up a few more votes for the POS. Thomas sums it up nicely ""We haven't lost a trade vote yet, and I don't intend to start now," :nuke:

[54anickel]

21. Rep. Blunt seeks K Street help on CAFTA (DUers need to counter this BS)

I friggen hate what K street has become! Of the people, for the people, by the people my ass!!! It's the corporations and plutocracy now. :grr:

http://www.thehill.com/thehill/export/TheHill/News/Frontpage/071905/blunt.html

Majority Whip Roy Blunt (R-Mo.) has asked lobbyists hoping to pass the Central America Free Trade Agreement (CAFTA) to redouble their efforts to press members of the New Democrat Coalition to support it.

CAFTA, the pact among the United States and six other nations, remains in jeopardy despite its passage in the Senate earlier this month. The sugar lobby has persuaded some Republicans who represent sugar farmers to oppose CAFTA, and others from manufacturing districts have also voiced their opposition.

Presumably falling short in its vote count with two weeks left before the August recess begins, the House GOP whip’s office turned to its K Street allies to try to persuade Democrats to vote in favor of CAFTA.

“The Republican leadership will not schedule CAFTA for a floor vote without significant bipartisan support,” Sam Geduldig, Blunt’s liaison to K Street, told the lobbyists in an e-mail sent last Tuesday. It was sent to remind staffers and GOP lawmakers about a meeting organized by Blunt and the House GOP conference to discuss CAFTA.

snip>

Burson Taylor, Blunt’s spokeswoman, said, “Trade votes never pass without Democrats. wants to see the Democrats who run on pro-trade platforms stay pro-trade when it counts.”

more....

[54anickel]

25. Bush tries to salvage trade accord (Arrogant little bastard)

http://www.iht.com/articles/2005/07/18/business/cafta.php

snip>

"This deal is a good deal for workers," Bush said in a speech on Friday at Gaston College in suburban Charlotte, North Carolina. "This basically says if you make a good product, it's going to be easier to sell your product to 44 million new customers."

Bush was mainly aiming his words at House Republicans from textile-producing areas, whose opposition to the Central American Free Trade Agreement has prevented party leaders from lining up a majority in favor of that pact. But so far, Bush is getting few results. Only one Republican from either North or South Carolina has pledged to vote for the accord - Representative Sue Myrick, whose district includes the Charlotte area. She flew in with Bush aboard Air Force One.

snip>

Bush is trying to persuade more Republicans to sign on to the deal because Democrats are unusually united in their opposition, with many who had voted for previous trade deals saying that too many jobs have been lost in the United States to trade deals and that the labor provisions in the pact will hurt workers in the United States and in Central America.

snip to arrogant little bastard quote>

In his speech, Bush painted a picture of booming exports that would result from eliminating tariffs that Central American countries now impose on American yarn and fabric.

"Central America is the second-largest market in the world for our textile products," he said. "I don't know if people here in North Carolina know that. Think about what I just said: It is the second-largest market for textile products. So if you're a textile worker, it seems like to me, one of the questions you ask is, Where do we sell our products?"

more..

[UpInArms]

43. Countering Doublespeak

http://tinyurl.com/b27og

The Nation -- The House of Representatives is moving toward a vote on the proposed Central American Free Trade Agreement, and the spin machines of the White House and the corporate special interests - along with their amen corner in the media - are working overtime.

These are the days when the big lies get told - as we learned more than a decade ago when the Clinton White House was busy working with congressional Republicans to win support for the North American Free Trade Agreement and more recently when Congress debated establishing permanent normal trade relations with China.

To counter the Orwellian twists of facts and figures that are sure to come from the White House and its political allies, fair trade campaigners (www.citizenstrade.org and www.wiscotrader.org) have come up with a top 10 list of trade doublespeak - and the facts to counter it:

No. 10: Our trade deficit actually shows how strong the economy is.That's a lot like arguing that the more you go into debt, the richer you really are. Here's what happened with NAFTA: Our trade deficit with those countries is 12 times bigger than before the pact - it shot up from $9 billion in 1993 to $111 billion last year. A high trade deficit weakens our economy.

No. 9: CAFTA slows immigration.This same false promise was made under NAFTA, and we all witnessed the opposite result of increased immigration from Mexico. CAFTA has back-door provisions that may make U.S. immigration laws and visa requirements in violation of the agreement, and unenforceable.

<snip>

No. 1 doublespeak: CAFTA trade policies create jobs and stimulate economic growth.It's the Big Lie. When we import more, and our trade deficit grows, we lose jobs, and export our wealth to other countries. We lost an estimated 900,000 net jobs to NAFTA. Outsourcing the American economy to other countries is a failing strategy for our future.

...more...

(edited to fix bad link)

[54anickel]

47. Thanks UIA - a great top 10 list!!! *co even tossed in a bit of fear and

terra, terra on this one. Terra, it's so versatile these days. :evilgrin:

No. 5: CAFTA is essential for national security.This desperate plea by Defense Secretary Donald Rumsfeld and Secretary of State Condoleezza Rice is a last-ditch effort by a failing administration to resuscitate CAFTA using fear and divisiveness. Short of votes in Congress, with a flawed strategy, they are attempting to scare the American people into support. Nobody really thinks al-Qaida has splinter cells in Costa Rica. We won't be fooled into believing Osama bin Laden is hiding out in the Dominican Republic.

And here's one of the important reasons folks should be fighting against this one tooth and nail as it has NOTHING in it for the working class of ANY country involved.

No. 4: CAFTA is a relatively small trade agreement.CAFTA is the largest trade agreement before our country since NAFTA, and a critical steppingstone toward creation of a 34-nation Free Trade Area of the Americas. It has become a national referendum on failed trade policies of the past, and the outcome will set a course for our future dealings with China. For local and state government, CAFTA would become the highest law of the land, determining rules on procurement, health care, zoning and immigration.

[54anickel]

42. A 21st Century Powerhouse: China Rising

http://www.truthout.org/docs_2005/071805D.shtml

snip>

Americans and people around the globe can feel the effects of China's voracious appetite for resources and the enormous output of its factories, staffed by an endless stream of migrants who toil for $2 a day churning out low-cost goods, undercutting foreign competitors and upending the low-end global work force.

The world has never seen a nation as big as China rise as far and as fast as China has in the last 20 years. Its ascent, like those of the United States, Germany and Japan before it, is challenging more established powers. Its continued progress depends on harmony with these and other nations.

snip>

In its quest, China has extended its influence to Africa, the Middle East and Latin America. Its "see-no-evil" foreign policy sometimes puts it at odds with the U.S. interest in promoting democracy, human rights and nuclear security. With investment and diplomatic support, for example, China bolsters oil-rich Iran and Sudan.

snip>

But China's economic power isn't only a source of friction; it's also attracted admiration. Australians, who are doing a brisk business selling to China, now view China more positively than they do the United States, an opinion poll by the prestigious Lowy Institute, a research center in Sydney, found in February. Some 69 percent of Australians look positively on China, while only 58 percent do so on the United States, the poll found.

Eventually, the United States could find itself competing with China for dominance in Asia. It would be the first time the United States faced a challenger with so much economic power.

more...

[UpInArms]

6. daily dollar watch

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

Last trade 89.77 Change -0.08 (-0.09%)

http://www.dailyfx.com/index.php?option=com_content&task=view&id=2336&Itemid=39

All Eyes Are On The Fed Chairman

Greenspan’s Congressional Monetary Policy Testimony (14:00 GMT, 10:00 EDT)

Outlook: Like all other planned statements from Alan Greenspan, the market started speculating on his words and their implications days before the actual event. This time, we were lucky enough to get a preview of things to come in the form of a well-timed written response to questions posed by Joint Economic Committee Chairman Jim Saxton. Just two days prior to his testimony, the response was released by the JEC and it contained several key phrases expressing opinions which are probably congruent with those that will be articulated during Wednesday’s testimony. First, he said that “a sharp flattening of the yield curve is not a foolproof indicator of economic weakness.” In further defense of economic performance, he acknowledged that, despite the negative effects of recent crude oil prices on GDP, the US economy is still “coping pretty well with the run-up in crude oil prices.” And even though Greenspan believes that the economy is in good health, it received help from falling long-term yields, which he described as “stimulative”. This comes after the latest official monetary policy meeting statement which found that the stance of policy remains accommodative. These tidbits add up to the economy absorbing pressure from oil prices while still being supported by both short-term monetary policy and long-term interest rates. This certainly allows the Chairman to say on Wednesday that the “measured” pace of tightening will be maintained since the economy obviously doesn’t need more handouts from the Fed.

...more...

http://www.dailyfx.com/index.php?option=com_content&task=view&id=2329&Itemid=39

Will Greenspan Bring the Dollar More Volatility?

US Dollar
The US dollar has given back most of its gains to end the session virtually unchanged. Dollar strength originally pushed the euro below the 1.20 level as European traders sent the greenback soaring on the back of easing oil prices and expectations for some positive words from Greenspan when he makes his speech tomorrow on the economy and monetary policy. The enthusiasm though evaporated when US traders joined the market. Throughout the US trading session, the EURUSD quietly recuperated all of its losses. The most logical explanation for the reversal was that even though Europeans may be expecting some outlier optimism from Greenspan, US traders believe that for the most part, Greenspan will only be cautiously optimistic, which will fail to satisfy the majority who happen to be banking on the Chairman’s words or lack thereof to inject some much needed volatility back into the markets. We expect Greenspan to reiterate his already known view that despite energy prices increasing inflation risk, growth in the economy remains firm and the labor market continues to improve. He will also probably add that for the time being, interest rates will continue to be increased at a measured pace. The debate between 3.75% and 4.00% rates should remain very much alive after Greenspan’s speeches Wednesday and Thursday, but as always, the semi-annual Humphrey Hawkins testimony does have the means of moving markets, especially since there will be a lively question and answer session after each of his testimonies.

...more...

http://www.dailyfx.com/index.php?option=com_content&task=view&id=2337&Itemid=39

EUR/USD – Euro bulls proved to be stronger than initially anticipated as single currency traders successfully defended the 1.2000 figure following an initial greenback assault. As the pair continues to head higher, a pullback toward the 1.1950 line will most likely provide euro longs with additional buying opportunity, with euro crosses experiencing an unparallel strength during the last few sessions, especially EUR/CHF which has been in an upward momentum since 1.5300. Indicators signal range trading conditions with ADX below key 25 line and oscillators remaining in a neutral territory.

<snip>

USD/JPY – Japanese Yen longs once again retreated with dollar longs pushing the pair above the 113.00 figure during the latest attempt by the greenback bulls to test the offers around the 114.00 figure. A move toward the 114.00 line will most likely see the pair test the offers around the psychologically important 115.00 handle, as a break above the 115.00 figure will most likely see the pair aim for the psychologically important 120.00 figure. Indicators continue to signal trending conditions with ADX at 39.92, but a note should be taken that the recent trend is about to run its course as momentum began to wane with the pair most likely toping out at 114.50 mark.

...more...

No Reports today - but the Petroleum Inventories will come out. We'll see if the DOE and the API have any semblance of agreement.

Have a Great Day Marketeers!

[UpInArms]

60. a peek at the buck (dropping like a rock)

check out the chart

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

Last trade 89.65 Change -0.20 (-0.22%)

Settle 89.85 Settle Time 23:35

Open 89.75 Previous Close 89.85

High 90.31 Low 89.53

Last tick: 2005-07-20 13:34:23 ET
30-min delayed quote.

It was sailing high earlier at 90.31 - check out the straight line down beginning at about 1:00 EST.

hmmmm

[54anickel]

63. OUCH! I was just gonna look when I saw that up line of the gold chart.

[UpInArms]

68. none too healthy today on the buck

Last trade 89.33 Change -0.52 (-0.58%)

Settle 89.85 Settle Time 23:35

Open 89.75 Previous Close 89.85

High 90.31 Low 89.13

Last tick: 2005-07-20 14:49:15 ET
30-min delayed quote.

[UpInArms]

76. Dollar loses post-Greenspan gains

http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid=%7BBC10F76B-3D20-4B29-96F3-1DD623DFD3A2%7D&

CHICAGO (MarketWatch) -- The dollar turned a sloppy, mixed trade into a steep decline against the euro and fell from 14-month highs against the yen as the gains for Treasury yields seen in the immediate wake of bullish congressional testimony from Fed Chairman Alan Greenspan faded by late afternoon. Yield differentials, compared to Europe in particular, had put the dollar in greater demand. The benchmark 10-year yield fell back to unchanged at around 4.18% as the bond market further digested what were largely as-expected comments on future interest-rate hikes from the Fed chief. The dollar decline also unearthed sell stops, traders said, accelerating its decline agains the euro. The greenback was last down 1% against Europe's shared currency, with the euro worth $1.2155. The dollar was down 0.1% at 112.69 yen after reaching 113.66 yen, its highst since May 2004.

[UpInArms]

8. GM posts quarterly loss (economists are surprised?)

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-07-20T122656Z_01_N20174287_RTRIDST_0_BUSINESS-AUTOS-GM-EARNS-DC.XML

DETROIT (Reuters) - General Motors Corp. (GM.N: Quote, Profile, Research) posted an unexpected second-quarter loss on Wednesday as its core North American automotive business lost more than $1 billion.

The result capped a nightmarish quarter for GM, which is struggling to regain market share from Asian rivals led by Toyota Motor Corp. (7203.T: Quote, Profile, Research) and saw its debt cut to "junk" status by the Standard & Poor's rating agency in May.

GM shares fell nearly 3 percent in pre-market trade.

The world's largest automaker, which triggered alarm bells on Wall Street when it reported a $1.1 billion loss in the first quarter, said its second-quarter loss totaled $286 million, or 51 cents per share.

The results, which included several one-time items, compared with a profit of $1.38 billion, or $2.42 per share, a year earlier.

Excluding one-time items, GM lost 56 cents per share in the quarter. On that basis, Wall Street analysts' average forecast was a profit of 3 cents a share, according to Reuters Estimates.

...more...

[UpInArms]

10. GM euro bonds drop after results - traders

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T125136Z_01_L20640022_RTRIDST_0_MARKETS-BONDS-GM.XML

LONDON, July 20 (Reuters) - Euro-denominated bonds of General Motors (GM.N: Quote, Profile, Research) dropped on Wednesday after the company posted a quarterly loss that was much worse than analysts' forecasts, traders said.

GM's 8.375 percent euro bond due 2033 traded down two points at 83 percent of face value, one trader said, while the cost of insuring against a default by the company's finance arm, GMAC, rose 35 basis points to around 480 basis points.

"This is horrible ... You can't miss earnings by that much," the trader said.

GM's core North American automotive business lost more than $1 billion in the second quarter. Excluding one-off items, GM lost 56 cents per share in the quarter, compared with an average of analysts' forecasts of a profit of 3 cents per share, according to Reuters Estimates.

...more...

Don't these folks understand the word "junk"?

[ozymandius]

12. Holy manhole! The forecasted profits just disappeared in mid-stride.

What were they thinking? Did they expect the employee discount gimmick to give them that much of a kick?

[UpInArms]

9. Kodak posts net loss, sets more (10,000) job cuts

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-07-20T121325Z_01_N20418134_RTRIDST_0_BUSINESS-TECH-KODAK-EARNS-DC.XML

NEW YORK (Reuters) - Eastman Kodak Co.(EK.N: Quote, Profile, Research) on Wednesday posted a quarterly net loss, hurt by restructuring costs, and said it would cut up to 10,000 more jobs than previously announced to speed its move into digital products and due to a faster-than-expected decline in film sales.

The world's top maker of photographic film posted a second-quarter net loss of $146 million, or 51 cents a share, compared with a net profit of $136 million, or 46 cents a share, a year earlier.

<snip>

Kodak, which in January 2004 had said it would cut its worldwide work force by up to 15,000 jobs, said it now plans to cut the work force by a total of 22,500 to 25,000 jobs.

Kodak at the end of 2004 had a worldwide work force of 54,800, down from 64,000 at the end of 2003.

The increased cuts will include about 7,000 manufacturing jobs and will result in total charges of $2.7 billion to $3 billion, up from expected charges of $1.3 billion to $1.7 billion announced originally, the company said.

Kodak said it also plans to trim its traditional manufacturing assets, including plants, factories and other equipment, to about $1 billion, compared with $2.9 billion in January 2004. The company, which has been closing factories since its restructuring began, did not detail if more plants would be closed.

...more...

[UpInArms]

11. U.S. mortgage applications increase last week-MBA (on refinancings)

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T110007Z_01_NAT001704_RTRIDST_0_ECONOMY-MORTGAGES-URGENT.XML

NEW YORK, July 20 (Reuters) - Applications for U.S. home mortgages edged higher last week, with a rise in refinancing activity offsetting a modest decline in home purchasing as interest rates increased, an industry group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity rose 1.2 percent to 801.1, denting the previous week's 7.2 percent loss.

The MBA's seasonally adjusted index of refinancing applications climbed 2.5 percent to 2,618.2 after falling 8.4 percent in the prior week.

The MBA's purchase index, a gauge of loan requests for home purchases, declined 0.1 percent to 488.7, after dropping 6.1 percent the previous week.

...more...

More "seasonally adjusted" numbers :eyes:

[ozymandius]

13. Gulp... check out the futures.

8:30AM: S&P futures vs fair value: -4.0. Nasdaq futures vs fair value: -11.0. Negative bias persists in pre-market trading as the absence of notable economic data this morning places even more emphasis on earnings and guidance... The latest large-cap name to disappoint investors and weigh heavily on early sentiment has been General Motors (GM), which has posted a huge loss of $0.59 a share versus an expected profit of $0.03

8:00AM: S&P futures vs fair value: -3.9. Nasdaq futures vs fair value: -10.0. Futures market versus fair value suggesting a lower open for the cash market in the wake of disappointing Q2 reports from Intel (INTC) and Yahoo! (YHOO) last night... On a positive note, better than expected earnings from Dow components Altria (MO), JP Morgan (JPM), Pfizer (PFE) and United Technologies (UTX) may help minimize weakness among blue chips

[ozymandius]

15. some backhanded positive news

JPMorgan Chase Beats Reduced Profit Target

NEW YORK (AP) -- JPMorgan Chase & Co., the nation's third largest bank, on Wednesday reported second quarter earnings of $994 million, or 28 cents a share, beating reduced Wall Street earnings' projections despite a sharp drop in trading revenue.

-cut-

The New York-based bank said that the second-quarter results included a number of special charges, including a $1.9 billion litigation reserve after a settlement over the bank's role in the collapse of Enron Corp. and $279 million in costs related to its merger last year with Bank One Corp.

Excluding the charges, earnings would have been $2.3 billion, or 66 cents a share.

Analysts surveyed by Thomson Financial had expected the bank to report earnings of 64 cents a share in the April-June period.

more...

http://biz.yahoo.com/ap/050720/earns_jpmorgan_chase.html?.v=5

[UpInArms]

16. After 14,500 HP layoffs, what?

http://www.mercurynews.com/mld/mercurynews/news/12174283.htm

excerpt:

HP declined to say how many of its 9,000 Bay Area employees would be let go but indicated that half the job cuts will come from information technology, human resources and finance. The rest will come from specific divisions. The company will offer a voluntary retirement program to its longer-serving employees in the United States.

As of January, the company will stop providing a pension to new U.S. employees. Those workers whose age and years of employment add up to less than 62 as of Dec. 31 will stop accruing pension benefits.

<snip>

Employees at HP campuses throughout Silicon Valley were somber and nervous Tuesday morning as they awaited ``the real details'' about the layoffs.

In his video message, Hurd said he would further explain the restructuring during an internal company Webcast scheduled for this morning. He said in the video he wants to make it simpler for customers to do business with HP.

...more...

Listening to A(lways)B(roadcasting)C(rap) last night - Charlie Gibson said that HP had been a "struggling" corporation now for years. How does that jibe with "booming economy"? :eyes:

[54anickel]

19. Hope none of those folks getting canned took on one of those new

fangled mortgages. Bay areas been pretty "bubbly". :-(

[UpInArms]

20. 2 big Phila.-area banks planning more job cuts (lots of management cuts)

http://www.philly.com/mld/inquirer/business/12173062.htm

Two of the biggest banks in the Philadelphia region are cutting jobs to stay attractive for investors in the face of rising expenses and tough competition.

PNC Financial Services Group, Pennsylvania's largest bank, plans to eliminate 3,000 positions, or nearly one worker out of every eight, over the next year and a half as the bank streamlines its bureaucracy, chairman Jim Rohr told investors yesterday.

Managers earning more than $80,000 a year and employees of corporate departments based at the company's Pittsburgh headquarters will account for a disproportionately large share of the cuts, spokesman Brian Goerke said.

Wachovia Corp., which runs the biggest branch-banking network in the Philadelphia area, said it, too, planned further "efficiencies" after eliminating a net 4,000 positions in the last year following mergers. The Charlotte, N.C., bank has ended a number of commercial-lending and support jobs in Philadelphia and other markets, retail stockbroker positions, and staff at Southern offices targeted for closing.

<snip>

The banks' cost-cutting moves come as local financial companies have seen an increase in applications from veterans of MBNA Corp.

The credit-card company is preparing to eliminate 6,000 jobs, or one-quarter of its national workforce, pending its planned acquisition by Bank of America Corp. following several years of slowing growth. The cuts are expected to fall especially heavily at MBNA's Wilmington headquarters.

...more...

[54anickel]

24. OUCH!!! Always a bad thing when big lay offs hit a concentrated

area. Poor Pittsburgh, certainly not as big as when the steel mills closed but not a good thing.

Looks like too many middle managers? :shrug:

[UpInArms]

22. 9:46 EST numbers (all red)

Dow 10,604.60 -41.96 (-0.39%)
Nasdaq 2,160.57 -12.61 (-0.58%)
S&P 500 1,227.11 -2.24 (-0.18%)
10-Yr Bond 4.192 +0.03 (+0.07%)

NYSE Volume 140,390,000
Nasdaq Volume 180,490,000

[UpInArms]

23. Treasurys dip ahead of Fed testimony

http://www.marketwatch.com/news/story.asp?guid=%7B2A3E58A0%2D1388%2D4AEE%2DB331%2D09C4E88FDE18%7D&siteid=mktw

CHICAGO (MarketWatch) - The benchmark 10-year Treasury note bobbed between unchanged and slightly lower Wednesday ahead of congressional testimony from Federal Reserve chief Alan Greenspan that most observers see reinforcing expectations for higher U.S. interest rates.

With no major economic reports on Wednesday's docket, Greenspan's 10 a.m. Eastern Capitol Hill appearance was the day's marquee event.

Most economists believe the economy is on a firm enough footing to allow the Fed chief to point to the effectiveness of gradual interest-rate hikes and signal there are more to come.

Greenspan "is more likely to validate the view that the Fed will continue to raise interest rates than endorse the view that a pause is imminent," said Tony Crescenzi, chief bond market strategist with Miller Tabak & Co. "Such can be surmised from recent economic news, which appears to indicate the economy is snapping back from a short and shallow soft patch."

"There are some in Washington who are saying that the neutral fed-funds rate may be higher than the market thinks and that the fed-funds rate will have to be raised above the neutral rate -- a new concept for which the bond market is not priced," Crescenzi said.

...more...

[UpInArms]

70. US Treasuries rebound, heightening Fed's conundrum

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T192601Z_01_N20545562_RTRIDST_0_MARKETS-BONDS-UPDATE-4.XML

NEW YORK, July 20 (Reuters) - Longer-dated U.S. Treasury debt rallied on Wednesday as investors appeared unimpressed by Federal Reserve Chairman Alan Greenspan's warning that interest rates should continue to move higher.

After an initial jolt lower on Greenspan's upbeat assessment of economic conditions, longer-dated bonds trimmed losses to squeeze above the breakeven mark in the afternoon.

Ten-year notes managed to climb 4/32 to yield of 4.17 percent from 4.18 percent on Tuesday, having failed to break a key resistance threshold at 4.25 percent.

Greenspan largely reiterated the central bank's usual line of thinking -- economic growth is steady and inflation is contained, a scenario that should allow policy-makers to continue tightening monetary policy.

...more...

[54anickel]

26. Skews and Smiles (Hussman)

http://www.hussmanfunds.com/wmc/wmc050718.htm

snip>

Hot Potato and Musical Chairs

The skew implied by options prices suggests the sort of considerations that investors should have at present. With valuations very rich, bullish sentiment high, and stocks generally overbought, there's a certain momentum to the market that makes it likely – in terms of probability – that stocks will be higher in the weeks ahead. Unfortunately, there's a small probability of some real damage, and that's what keeps us defensive.

Being defensive isn't the most comfortable position, of course, because most probably we'll be disappointed to miss some amount of gains in the market. But that small probability of a large loss matters here, particularly because as I've noted in numerous weekly comments, whatever gains that the market generates at this point are unlikely to be durable. A moderate market decline without much internal damage might make it reasonable to accept a limited amount of market risk, but given the market's present overbought condition, it makes sense to tread lightly here.

If you listen to the tenor of investment strategists here, the basic message sounds a lot like what we heard in the late 1990's: stocks may not be priced to deliver strong returns on a sustained basis, and there are substantial risks in the longer-term picture, but for now, things seem to be going well and so there's no need to be defensive just yet.

Famous last words: The light's still yellow. Punch it.

Essentially, investors are playing hot potato and musical chairs here. Smelling smoke in the crowded theatre, but with the aisles still fairly empty, not willing to miss any of the show until somebody yells fire. It's a dangerous game.

more...

[UpInArms]

27. UPBEAT GREENSPAN CALLS FURTHER RATE HIKES NECESSARY

http://www.marketwatch.com/news/story.asp?guid={BC09FBB8-DC90-4547-9C2A-65E129E89169}&siteid=mktw

Greenspan sees good times ahead
Says Fed must keep raising rates

What planet does this mutant freak live on?????!!!????

WASHINGTON (MarketWatch) - The U.S. economy is in good shape and the positive news should continue as long as the Federal Reserve keeps nudging interest rates higher, said Fed chief Alan Greenspan.

"Our baseline outlook for the U.S. economy is one of sustained economic growth and contained inflation pressures," Greenspan told the House Financial Services panel on Wednesday in his semi-annual report on monetary policy.

In order to ensure this forecast, the Fed must continue to raise interest rates, Greenspan said.

"In our view, realizing this outcome will require the Federal Reserve to continue to remove monetary accommodation," he said.

The Fed has raised interest rates in baby steps to 3.25% from 1.0% in the past year.

<snip>

The trade sector was likely to remain a drag on the growth rate in coming quarters, Greenspan said, although the rebound in the dollar would damp some inflationary pressure.

Although there are some overheated housing markets, Greenspan said, the economy should be able to handle any drop in home prices.

...more...

:wtf:

I don't even know where to begin - but this thing is an abomination to mankind.

:argh:

[UpInArms]

33. Credibility Problems Plague Has-Been Partisan Hack

Conundrum still worries Greenspan

http://www.marketwatch.com/news/story.asp?guid=%7B0DB5A55A%2DBFE6%2D42E7%2D9B72%2DA474363F9E12%7D&siteid=mktw

WASHINGTON (MarketWatch) - The U.S. economy is doing fine and inflation is under control, but Federal Reserve Chairman Alan Greenspan is worried.

Greenspan, for all his years of experience, can't figure out why monetary policy doesn't seem to be working the way it usually has.

For the past year, the Fed has been diligently raising short-term interest rates, yet long-term rates remain stubbornly low. At the same time, investment remains weak even after years of stimulative policies.

"Such a pattern is clearly without precedent in our recent experience," Greenspan said Wednesday in congressional testimony. See full story.

...more...

The LIES don't seem to be selling quite so well.

:rofl:

[54anickel]

37. I like this line, especially in lieu of the "idiot-n-thief" spewing on

about how his policies are working and all. ;-)

Contrary to supply-side theory, a huge infusion of cash into U.S. corporations in the past few years has not led to a large increase in investment. It appears that it was not high taxes that restrained investment in the future, but executives' uncertainty about the prospects for a decent rate of return.

[ozymandius]

38. He's playing a psychops game. It's a bit like Russian Roulette.

Rising interest rates are a bluff to provide window dressing to the notion that everything's fine with our economy. This is willful ignorance. It is also criminally irresponsible.

Decent intellectuals everywhere should shun the man.

[patcox2]

41. Greenspan knows the real inflation numbers.

And above all, modern monetary policy is anti-inflation, because inflation erodes the value of amassed wealth and capital.

Inflation can actually help the working person who is a net creditor, as real estate inflation right now is building equity for people. But inflation reduces the value of wealth in general, and of many of the safest investments, like bonds, so people who don't work and live off investments are hurt by inflation.

Thats why Greenspan is and always has been batshit crazy about warding off inflation and will always choose a recession to an inflationary period any day.

And he is doing so, because despite that the published figures purport to show little or no inflation, he knows the truth, that the figures are bullshit.

[54anickel]

44. Greenspan May Remain Chairman a Little Longer

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_berry&sid=aMi8rALrcumU

snip>

To get a new chairman confirmed this year, Bush needs to move exceptionally fast because Congress would like to adjourn as early in the fall as possible. There is no hint he will do that, and Karl Rove has said Bush doesn't want to undermine Greenspan's authority by naming a successor before his term expires.

Under the law, a member of the Board can continue to serve until a successor has been nominated and then confirmed by the Senate. In other words, Greenspan could easily still be chairman when it's time for the next monetary policy report in February.

The problem with a delay is that even without the chairmanship up in the air, around the turn of the year there is likely to be plenty of uncertainty about Fed policy -- and perhaps significant market volatility as a result.

snip>

Greenspan has said he and his colleagues will be able to know when they have moved the target into the neutral range. Some other officials indeed worry that they may overshoot before they recognize where they are.

snip>

``You don't have the same burden of transparency with an easing,'' he said. ``When it comes to cutting rates, you don't have to apologize'' for surprising the market.

The scenario Kim and DiClemente are describing might well play out early next year. It is hardly comforting that the future of the chairmanship may be uncertain as well. Unfortunately, given the White House timetable, and the potential for some opposition to Bush's choice, it could easily be March, April or even May before Greenspan's successor actually moves into the office on Constitution Avenue.

more...

[UpInArms]

59. J.P. Morgan in black due to consumer, home-equity lines

http://www.marketwatch.com/news/story.asp?guid=%7B17A91DAD%2D59F4%2D4554%2D937E%2D091696D429AE%7D&siteid=mktw

NEW YORK (MarketWatch) - J.P. Morgan Chase & Co. said Wednesday that strong consumer banking and home-equity business helped offset a big drop in trading results and lift the company to a profit in the second quarter.

The New York bank (JPM: news, chart, profile) reported second-quarter net income of $1 billion, or 28 cents a share, compared with a net loss of $500 million, or 27 cents a share, in the year-ago period.

In June, J.P. Morgan said it would take a $2 billion charge in the second quarter to account for the settlement of a class-action lawsuit filed by investors in Enron Corp. See archived story.

...more...

Look at all the "equity" that homeowners have built up in case the price of housing drops! We're rich! Rich, I tell you!

[UpInArms]

62. un-American Has-Been Partisan Hack sells out USofA

Only small rate impact from o/seas bond demand-Greenspan

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T172238Z_01_WAT003577_RTRIDST_0_ECONOMY-GREENSPAN-RATES-URGENT.XML

WASHINGTON, July 20 (Reuters) - Federal Reserve Chairman Alan Greenspan said on Wednesday the net impact on U.S. borrowing rates from large purchases of Treasury securities by overseas governments and investors is small.

"We've examined the issue of the impact of the purchases of foreigners of U.S. Treasury issues and the increase or decrease of those purchases on U.S. interest rates - and there is an effect but it's not a very large effect," Greenspan told the House Financial Services Committee.

"The reason is that, in the aggregate world of markets, there are enough securities that compete with U.S. Treasuries ...that you don't get as large an impact as you would suspect," Greenspan said following his semi-annual testimony on the U.S. economy.

...short newsblurb...

[UpInArms]

65. more split-pea spew

Some house price declines a certainty - Greenspan

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T165735Z_01_WAT003575_RTRIDST_0_ECONOMY-GREENSPAN-DISPARITY-URGENT.XML

WASHINGTON, July 20 (Reuters) - Federal Reserve Chairman Alan Greenspan said on Wednesday there are certain to be price declines in some U.S. housing markets and reiterated warnings about the increasing use of "exotic" mortgages.

He also said the rise in incomes of skilled workers while lower incomes languished was a product of an undersupply of highly skilled workers.

"So we are getting a bivariant income distribution and as I've said many times before, for a democratic society, this is not helpful, to say the least," Greenspan told the House of Representatives Financial Services Committee.

...very short blurb...

[UpInArms]

28. Crude futures climb above $58 a barrel

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38553.4213923611-838930784&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- August crude is up 69 cents at $58.15 a barrel in early New York trading. Analysts attributed the strength to Hurricane Emily's disruption to oil output in Mexico as well as market expectations that the Energy Department will report a decline in last week's crude inventories. The government data will be released after 10:30 a.m. Eastern.

[UpInArms]

32. Oil rises as US warns of Saudi attack threat (Reuters story missing?)

http://today.reuters.com/business/newsarticle.aspx?type=tnBusinessNews&storyID=nL20651759&imageid=&cap=

Reuters - 45 minutes ago
Oil prices shot up on Wednesday after the United States embassy in Saudi Arabia warned that militants were planning fresh attacks in the world's number one oil exporter.

Found on Google News Business Page -

here's what I get when I go to the link:

No story could be found.

© Reuters 2005. All Rights Reserved.

hmmmmmm

[54anickel]

40. U.S. says militants planning attacks in Saudi

Interesting short thread on it....

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1640292


http://today.reuters.com/News/newsArticle.aspx?type=topNews&storyID=2005-07-20T124452Z_01_N20432175_RTRIDST_0_NEWS-SECURITY-SAUDI-USA-DC.XML

RIYADH (Reuters) - The United States embassy in Saudi Arabia warned U.S. citizens on Wednesday that militants were planning fresh attacks in the world's biggest oil exporter.

"The American embassy in Riyadh advises all American citizens living in Saudi Arabia that it has received indications of operational planning for a terrorist attack or attacks in the kingdom," an embassy statement read out by an official said.

"The embassy has no specific information concerning timing, target or method of any possible attack(s)," the statement said.

[UpInArms]

39. Energy Dept reports small (?) fall in crude stocks

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38553.4411786458-838931878&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- The Energy Department said crude supplies fell by 900,000 barrels to 320.1 million for the week ended July 15. Motor gasoline inventories also fell 1.3 million barrels to total 211.3 million. Distillate stocks were up 2.3 million barrels at 122.7 million barrels. Following the data, August crude in New York is up 14 cents at $57.60 a barrel on its expiration day after trading above $58 earlier. August heating oil is up 0.49 cent at $1.635 a gallon and August unleaded gasoline is up 2.15 cents at $1.695 a gallon.

Almost a million is small? And then over a million? Okie dokie!

[UpInArms]

29. 10:17 EST numbers (redder) Market does see "Good Times Ahead"

Dow 10,587.17 -59.39 (-0.56%)
Nasdaq 2,159.41 -13.77 (-0.63%)
S&P 500 1,223.53 -5.82 (-0.47%)
10-Yr Bond 41.92 +0.03 (+0.07%)

NYSE Volume 368,447,000
Nasdaq Volume 405,895,000

[54anickel]

31. So does the DOW break 10,500 again this week? Seems to be the

pattern this year.

[UpInArms]

36. 10:34 EST - a little help going on?

Dow 10,601.18 -45.38 (-0.43%)
Nasdaq 2,163.39 -9.79 (-0.45%)
S&P 500 1,224.70 -4.65 (-0.38%)
10-Yr Bond 4.200 +0.11 (+0.26%)

NYSE Volume 467,670,000
Nasdaq Volume 503,474,000

10:00AM: Stocks still on the defensive as the majority of sectors remain negative... Providing the bulk of leadership to the downside has been Technology, as INTC and YHOO shares get hammered... Aside from GM's disappointment , Eastman Kodak's (EK 26.23 -2.51) profit checking in well below expectations has also weighed on Consumer Discretionary... Despite rising oil prices ahead of weekly inventories data (10:30 ET), Energy has also lost ground... The EIA is expected to show a 3.5 mln decline in crude supplies, a 1.5 mln barrel draw in gasoline supplies and a 1.7 mln barrel build in distillates...

Health Care, however, has surged following strong Q2 reports from Pfizer (PFE 27.40 +0.02) and Amgen (AMGN 78.48 +7.96)... Materials has also traded higher, getting a boost following upbeat analyst comments on several market leaders (i.e. AA, GP, X, PD)... DJTA +0.7, DJUA -0.2, DOT -1.3, Nasdaq 100 -0.6, Russell 2000 -0.2, SOX -1.3, S&P Midcap 400 -0.2, XOI -0.5, NYSE Adv/Dec 1188/1316, Nasdaq Adv/Dec 937/1416

9:40AM: Market opens lower as a batch of quarterly disappointments counter yesterday morning's upbeat reports... An unsatisfactory Q3 outlook from Intel (INTC 27.01 -1.70), following in-line Q2 results amid weaker than expected gross margins, as well as in-line Q2 earnings (revenues were light) and lackluster guidance from Yahoo! (YHOO 33.98 -3.75) last night have been the catalysts weighing most heavily on early trading...

Couple those results with a poor quarterly performance from General Motors (GM 35.40 -1.43) and investors have found little reason to extend a rally yesterday that was fueled by strong earnings data...

back above that magic 10,600 number :eyes:

[54anickel]

30. Assessing the Demand for Residential Real Estate

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=44901

Recently the CEOs of some residential construction companies have been on television’s “financial news” networks taking about their companies and emphasizing the following two points.

1. This time, the housing market is not as sensitive to increases in interest rates as in the past, especially since the rates are at historically low levels. The point being emphasized is that the rates can go higher (another 200 basis points?) before having a significant impact on home sales.
2. The housing market is all about SUPPLY and DEMAND.


Point 1 is related, in part, to the “Greenspan’s Conundrum” that writers on this site and elsewhere have explained using a “supply and demand” scenario for dollar denominated debt, with contribution from foreign buying of the intermediate-to-long end of the yield curve. This article examines the second point made above, especially the demand side of the housing market. Demand For Residential Housing can be classified into two categories. The first covers houses (or condos) purchased for buyer-occupancy as primary residence (PFR). All other purchases can be categorized as Purchases for Investment (PFI). Vacation homes which are not the primary residence of the owner will be included in the PFI bucket. The next two sections examine the demand in these two groups. Only net demand is considered here- someone selling a house to buy another does not create net incremental demand.

snip>

House Purchases for Investment


Recent reports indicate that in certain areas more than ten percent of house purchases are being made purely for investmen purposes, with the buyer not residing in the house. Part of this is being attributed to foreign buying of American housing. While the demand in this foreign-ownership category is hard to assess, it can be inferred that a further weakness in the dollar vis-à-vis other major currencies will be positive for incremental demand. If the Yuan strengthens by nearly 40% relative to the dollar, as many China-critics want, this will enable greater purchases of American real estate by the Chinese. One point to note about real-estate investment is that unlike paper investments such as equities or bonds, there is a “real” outflow of money during the time of ownership of real-estate. This includes taxes and maintenance costs. A house purchased as an investment can be rented out for income, but there may be downward pressure on rents if the rate of homeownership among the “renters” goes up relative to the rate of conversion of apartment units into condos or other units meant for sale.


In summary, the magnitude of the unfulfilled demand for housing combined with financial “new product development” can keep the current housing boom going for a few more years. However these new financial products have yet to stand the test of the vagaries of the environment- an economic downturn or an interest rate spike or other events that may cause lenders to pull in the reins. To understand the magnitude of the impact of a constrained lending environment it is useful to look at the sharp decline in prices of telecommunications stocks in 2001-2002 when investors became more risk-averse. Some companies went bankrupt and those left holding the bag (like the author) did not receive any bailout from the government. Others like Lucent and Nortel are currently trading at less than 5% of their peak values. The expectation with the housing market now is quite different. Despite the new bankruptcy law that makes filing Chapter 7 more difficult, house buyers are purchasing financial products with greater risk on the downside. Investors are pouring more money into the homebuilders and the lenders. Part of the bet is that with the scale of liabilities of the mortgage industry, especially the GSEs, the Fed and the government will bail out the financial sector from any disasters, shifting the burden to the public. As alluded to by others, ‘character’ is being tested- that of buyers, lenders, builders, investors, and the public at large.

more...

[54anickel]

34. Local janitors inspire striking in other cities

http://www.chron.com/cs/CDA/ssistory.mpl/business/3273610

Striking janitors from Houston flew to Washington, New York and Sacramento on Tuesday and set up picket lines to protest their low wages and lack of health insurance.

The janitors, who work for ABM Janitorial Services, went on strike Monday night at First City Tower.

In sympathy with the Houston workers, janitors in more than 30 cities, including Chicago, Philadelphia and San Francisco, went on strike. Janitors in Indianapolis, who filed charges of unfair labor practices against ABM on Monday, also joined the strike.

snip>

As many as 10,000 janitors work in Houston cleaning the city's office buildings at night. They're mostly immigrant women who earn about $5.25 an hour for the part-time work. The majority work for one of five national cleaning companies, including ABM, which dominates the local office-cleaning market.

snip>

And if they do join the picket line, and do not report to work, they face the chance of losing their jobs, he said.

more one sentence paragraphs :grr:....

[UpInArms]

35. Putnam Lovell M&A deal volume up 67% in first half

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38553.4300969097-838931343&siteID=mktw&scid=0&doctype=806&

BOSTON (MarketWatch) -Putnam Lovell NBF Securities Inc. Wednesday said its investment banking team advised on 10 transactions announced in the first six months of this year, up 67% from six deals announced in the first half of last year. Putnam Lovell said it expects a "robust" deal-making environment in the global financial services industry in the second half of 2005, fueled by pressure on companies to "firm up favored business lines and carve out unwanted operations."

[UpInArms]

45. 11:33 EST numbers and blather (good times are coming!)

Dow 10,622.12 -24.44 (-0.23%)
Nasdaq 2,170.25 -2.93 (-0.13%)
S&P 500 1,228.14 -1.21 (-0.10%)
10-Yr Bond 4.238 +0.49 (+1.17%)

NYSE Volume 756,947,000
Nasdaq Volume 779,292,000

11:00AM: Market rebounds some but not nearly enough to make a significant change in the standings as oil prices fall following inventories data... The EIA has reported a smaller than expected draw in crude oil supplies of 900K barrels (consensus -3.5 mln), a larger than anticipated build in distillates of 2.2 mln barrels (consensus +1.7 mln) and a 1.3 mln barrel decline in gasoline inventories (consensus -1.5 mln)...

But even though crude oil futures ($57.40/bbl -$0.06) have turned negative, providing some relief for investors, further deterioration in the Energy sector has removed some of the market's much needed leadership... XOI -1.0, NYSE Adv/Dec 1105/1842, Nasdaq Adv/Dec 1126/1591

10:30AM: Major indices extend their reach below the flat line, taking a bearish cue from a continued rise in benchmark yields... Within the last 30 minutes, bonds have fallen to session lows, lifting yields on the 10-year note (-13/32) to 4.23%, as traders keep a close eye on Greenspan's testimony... Even though inflation remains in check and the economy is on firm footing, Greenspan has said the Fed must "continue" to raise interest rates, as high energy costs continue to put pressure on consumer prices...NYSE Adv/Dec 1190/1639, Nasdaq Adv/Dec 1033/1576

[54anickel]

46. Bank Risks Boosted by Beggar-Thy-Neighbor

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_gilbert&sid=ac71uLaw4EAI

July 20 (Bloomberg) -- Ask central bankers which market poses the greatest potential risk to global financial stability, and they'll probably point an accusing finger at the derivatives industry. They should be worrying instead about the plain-vanilla syndicated loans market.

Banks are engaged in a cutthroat game of beggar-thy-neighbor, sacrificing fees and interest rates to lend to their customers in the hope it will win them higher-paying investment banking business in the future. That's fine when times are good, the economy is growing and few companies are defaulting. As a method of storing up trouble, however, guaranteeing cheap money for five, six, seven years into the future is hard to beat.

snip>

The Fed itself is partly to blame for lax lending, a victim of its own success in managing the economy. About half of the banks in its survey ``cited a more-favorable or less-uncertain economic outlook as a reason for their move toward a less- stringent lending posture,'' the U.S. central bank said.

snip>

Increased trading in the secondary market, which allows banks to sell their loans to tune their range of obligations, was also cited as making institutions more willing to take on new loans at more favorable rates for the borrowers. A similar argument can be made for credit-default swaps, which allow lenders to buy insurance against a default by the companies they've lent money to.

The secondary market, though, may close for business at the very time deteriorating creditworthiness prompts banks to scale back their loan books. A sudden surge in defaults could do the same to the credit-default swap market. Both markets are too young and lacking in history to be relied on at times of trouble.

more...

[54anickel]

48. Funds expect US rates to reach 4%

http://news.yahoo.com/s/ft/20050719/bs_ft/fto071920051957233542;_ylt=Av2E0Bb5eTGUtRCqkint3vP2ULEF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl

The figures have led fund managers to believe that the Fed will raise benchmark interest rates by a further 75 basis points to reach a so-called neutral stance in monetary policy - the point at which borrowing costs do not slow down economic growth, while inflationary pressures are kept in check.

snip>

He added that while fund managers thought growth was improving, they were unconvinced that it would support corporate margins.

Their scepticism is reflected in higher cash positions, with a net 19 per cent of managers saying they hold overweight positions in cash. The net refers to the balance of fund managers' views.

snip>

US stocks remained out of favour, with a net 29 per cent of global fund managers saying they were underweight in Wall Street shares.

snip>

Meanwhile, an index of investor confidence from State Street Global Markets fell to 81.1 for July, from 85 last month. Michael Metcalfe, senior strategist at State Street, said the index was near its lowest point this year, reached in March, and warned " highlights that the economic outlook is perhaps not as rosy as a cursory glance at the fundamentals might suggest".

more...

[54anickel]

49. Next Impetus for Gold (Willie)

http://www.321gold.com/editorials/willie/willie072005.html

From the early months of 2002, the key currency movement associated with the rise in gold has been the euro. Clearly, gold and the USDollar compete for primacy. When investors shied away from the world reserve currency and its linked Treasury bonds, they paid less attention to capital flows and sought interest rate differentials, but with a certain liquidity requirement. The euro has the liquidity, without question. The Euro Central Bank had offered a right fine carry trade during all those months where the US short rates were stuck in the mud at 1.0% and the long Eurobonds offered almost 4% yield. Those days are gone. The euro currency has become the first victim of the competing currency wars. The Eurozone economy is a victim of its own currency appreciation, a success in some queer circles by those who favor inflation as a policy and harbor disdain for European unwillingness to inflate. One should keep in mind that in six of the last 12 months reported, the US bilateral trade deficit with the European Union is over $10 billion. The capital flows will help to offer the euro some stability in the face of the rate differential which favors the USDollar nowadays.

STAGE #1 LED BY EUROPE
Von Mises warned of casualties in entire economies from currency warfare. The EU has suffered and is now weakened. Its euro currency can no longer compete against the USDollar, nor compete as a gold alternative. As a result, gold will rise in euro denomination, not so much from vigor or strength in gold demand, but more from euro weakness and impending debasement of the euro itself. The EU member nations are certain to stimulate their economies, invite wider asset bubbles, and encourage their flagging economies by whatever means, even if those methods mimic the discredited, fraudulent, heretical devices employed as principal driving forces in the US Economy. Namely, monetary inflation and unbridled credit growth in all their infamous glory. The gold alternative has been evident in Europe in recent months. The technical chart is very bullish for gold in euro terms. A breakout is upon us. A pullback to the breakout point, much like a diver on a springboard, is followed by a leap.

STAGE #2 LED BY ASIA
About three years ago, several conversations can be recalled with friends of mine. A train of evolutionary advance was clear to me. Gold could not simply take the mantle from the USDollar. First the euro rises, then the Asians rise, then gold leads uniformly, in that order. Too much had to happen along the way, a path to destruction. The currency wars would have to play out, to unfold, to wreck their havoc. The USDollar would give ground to the euro currency in the first round. That is done. The USDollar would give ground to the Asian currencys in the second round. That has yet to begin, but with the advent of the Chinese yuan currency revaluation, we might indeed be at that doorstep.

The Japanese yen has been engineered not to rise, by force, executed by the Bank of Japan (which some believe takes orders from the US Federal Reserve). As pointed out frequently in the Hat Trick Letter, the USFed is tied to JPMorgan in the rescue of the former's underwater hedge book. Of course, just a rumor. JPMorgan has merged in some sense with giant Sumitomo Bank in Japan, with $1.5 billion cash dowry bestowed upon JPM two years ago in a marriage of titans. Thus the link between the USFed and Bank of Japan. A legless JPM married an acne-scarred Sumitomo in order to enable potential control of the Japanese giant banks from New York City puppeteer strings. Regardless, by holding fort in preventing a yen currency rise, Japan has finally shot itself in the foot. While Europe lost its export trade, Japan incurred higher energy costs. The untold story about the Japanese economy is that Japan has been harmed by the Chinese resurgence of manufacturing outsourcing, just like the US Economy was harmed in the 1980 and 1990 decade by the rise of Japan and the entire Pacific Rim of Asian Tigers (Taiwan, Hong Kong, South Korea, Singapore). So without a rising yen, the Japanese have suffered rising energy costs in unhedged fashion. The technical chart is very bullish for gold in yen terms. A breakout is upon us. A pullback to the breakout point, much like a diver on a springboard, is followed by a leap.

snip>

The USGovt officials seem eager for China to lift the value of their yuan currency. As though that will make an iota of difference in narrowing the bilateral China trade deficit. Over the last 12 months, that deficit has averaged $15.0 billion per month. With a higher valued yuan, China will give themselves an instant discount on all imported oil, natural gas, coal, copper, silver, iron, cement, lumber, and chemicals. The discount will be roughly 80% to 90% of the yuan change, save shipping costs. The rise in US retail shopping shrines (malls) will be roughly 15% to 20% of the yuan change, the proportion of value added by Chinese labor. Wall Street analysts have only begun to come around and recognize the extremely limited potential change to the trade deficit from a currency shift. So why pursue it? My answer is to show China that Washington DC carries the leader baton, the stick, and calls the shots. Look for WalMart prices to rise no more than 2% on Chinese items. Look for no change in the bilateral trade deficit. But but but... look for extreme changes to China's willingness to play the insane Bretton Woods Plastic Accord game any longer. In 1985, the Plaza Accord called for a concerted climb in the USDollar with foreign central bank assistance. The Plastic Accord (aka Bretton Woods II) is the informally maintained insanity of Asian credit supply for profligate consumption, counter-productive tax reform, highly leveraged retail financing, and housing speculation inside the United States. China, via the trade war and the simultaneous political pressure to alter its yuan currency regime, will react badly. The Plastic Accord is at risk, nay doomed.

more...

[54anickel]

50. 12:30 lunchtime check

Dow 10,609.54 -37.02 (-0.35%)
Nasdaq 2,167.47 -5.71 (-0.26%)
S&P 500 1,226.87 -2.48 (-0.20%)
10-Yr Bond 4.215% +0.03
NYSE Volume 960,442,000
Nasdaq Volume 970,451,000

12:00PM : Market trades at improved levels, as oil prices continue to tumble, but remains under modest pressure midday as quarterly disappointments from bellwethers like Intel, Yahoo and GM and surging bond yields continue to weigh on the proceedings... Second-quarter reports from Intel (INTC 27.05 -1.66) and Yahoo (YHOO 33.57 -4.16) that failed to amaze Wall Street last night have underpinned a sense of nervousness all morning, as a lack of noteworthy economic reports has placed even more emphasis on earnings and guidance...
And even though the majority of S&P 500 constituents (16 of 23) posting results this morning have beaten analysts' expectations, a blue chip disappointment from General Motors (GM 36.32 -0.51), which missed analysts' Q2 forecasts by a large margin, has weighed on sentiment and left 6 out of 10 economic sectors underwater... Pacing the way lower has been Technology, stemming from the INTC and YHOO disappointments... Minimizing sector losses, however, has been a turnaround in Semiconductor, following better than expected reports from TER and NVLS...

In addition to GM's poor quarterly performance, worse than expected earnings from Eastman Kodak (EK 26.58 -2.16) have also weighed on the Consumer Discretionary sector... Energy has also traded lower, amid further deterioration in crude oil prices ($56.35/bbl -$1.11) following better than expected oil inventories data... Crude oil supplies fell 900K barrels (consensus -3.5 mln) and gasoline inventories fell 1.3 mln barrels (consensus -1.5 mln) while distillates rose 2.2 mln barrels (consensus +1.7 mln)... The interest-rate sensitive Utilities sector has fallen at the expense of rising bond yields...

The benchmark 10-year note, which is off 8 ticks to yield 4.21%, has been under pressure all morning after Fed Chairman Greenspan said the Fed must "continue" to raise interest rates as high energy costs still put pressure on consumer prices... Health Care, however, has surged following strong Q2 reports from Pfizer (PFE 27.48 +0.10) and Amgen (AMGN 80.50 +9.98) while upbeat analyst comments on several market leaders (i.e. AA, GP, X, PD) has provided a boost to Materials...DJTA +1.3, DJUA -0.4, DOT -1.0, Nasdaq 100 -0.2, Russell 2000 +0.3, SOX +0.8, XOI -0.7, NYSE Adv/Dec 1614/1445, Nasdaq Adv/Dec 1431/1395

11:30AM : Renewed buying interest, spearheaded by a turnaround in chip stocks, lifts the major averages to their best levels of the session... The PHLX Semi Index, which was off almost 2.0% right around the open, has recently turned positive, getting a boost from semi cap equipment names like AMAT (+2.0%), KLAC (+2.5%), NVLS (+5.4%) and TER (16.9%)... Last night, TER posted a narrower than expected loss while NVLS beat analysts' Q2 estimates by $0.03...

Oil prices losing more than $1/bbl within the last 15 minutes, falling to $56.25/bbl (-$1.21), may be providing the boost to overall sentiment that has inspired investors to pare early losses...SOX +0.3, NYSE Adv/Dec 1262/1726, Nasdaq Adv/Dec 1265/1500

11:00AM : Market rebounds some but not nearly enough to make a significant change in the standings as oil prices fall following inventories data... The EIA has reported a smaller than expected draw in crude oil supplies of 900K barrels (consensus -3.5 mln), a larger than anticipated build in distillates of 2.2 mln barrels (consensus +1.7 mln) and a 1.3 mln barrel decline in gasoline inventories (consensus -1.5 mln)...

But even though crude oil futures ($57.40/bbl -$0.06) have turned negative, providing some relief for investors, further deterioration in the Energy sector has removed some of the market's much needed leadership... XOI -1.0, NYSE Adv/Dec 1105/1842, Nasdaq Adv/Dec 1126/1591

[UpInArms]

51. 1:20 EST miracle recovery in progress

Dow 10,646.64 +0.08 (+0.00%)
Nasdaq 2,176.45 +3.27 (+0.15%)
S&P 500 1,230.97 +1.62 (+0.13%)
10-Yr Bond 4.200 +0.11 (+0.26%)

NYSE Volume 1,122,216,000
Nasdaq Volume 1,128,220,000

1:00PM: Little changed since the last update as the major averages continue to vacillate in roughly the same ranges... The Industrials sector, however, has recently inched into positive territory... Solid gains in shares of Honeywell (HON 37.93 +0.33), following a strong Q2 report that included upside FY05 guidance, coupled with better than expected earnings from General Dynamics (GD 113.60 +3.03) and broad-based strength in Railroads (i.e. BNI, NSC, CSX, UNP) have provided a floor of support... NYSE Adv/Dec 1613/1506, Nasdaq Adv/Dec 1434/1429

???

[54anickel]

53. Amazing. And more better than expected earnings to boot.

[UpInArms]

55. perhaps a case of Divine Intervention:

'cause these earnings aren't looking so good :eyes:

http://www.marketwatch.com/news/story.asp?guid=%7B3C380B28%2D0546%2D47AF%2D8E4D%2DFB51A81D2BEC%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Gentex Corp. shares fell as much as 8% Wednesday after the rearview-mirror maker reported a second-quarter profit decline that came up short of Wall Street targets.

In midday trading, shares of Gentex (GNTX: news, chart, profile) were down $1.18, or 5.8%, at $19.09.

The Zeeland, Mich.-based parts supplier, which also makes smoke detectors and fire alarms, reported earnings of $26.04 million, or 17 cents a share, down from $28.98 million or 18 cents, a year ago.

Analysts polled by Thomson First Call were looking for a profit, on average, of 18 cents a share.

Executive VP Garth Deur said in a statement that the company hasn't seen much of a boost from the highly publicized employee-price discount programs offered by Detroit's Big Three.

"Gentex benefits only when production increases on the vehicles offering our mirror products," he added. "This did not, for the most part, happen with those customers during the second quarter."

...more...

[54anickel]

58. That would mean "Amazing Grease"...eom

[specimenfred1984]

67. Pumpty Dumpty: Fed Speaks, Fed Pumps

Then they'll dump.

Pumpty Dumpty sat on a wall
Pumpty Dumpty had a great fall
All the kings horses and all the kings men
Were a bunch of corrupt and conspiring traitor mutha fckers!

Oh well, there goes the kid's book!

[ozymandius]

69. Did you say DIVINE INTERVENTION?

[UpInArms]

56. U.S. stocks turn higher, investors shrug off Greenspan

spin spin spin

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38553.5621260417-838939003&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) -- The major stock indexes reversed course in afternoon trade as investors decided comments from Federal Reserve Chairman Alan Greenspan confirming further interest rate increases had already been priced into the market. The Dow Jones Industrial Average ($INDU) was last up 3 points at 10,649, the Nasdaq composite ($COMP) was up 3 points at 2,176 and the S&P 500 ($SPX) rose 2 to 1,231.

yeah, right :eyes:

[UpInArms]

73. US stocks rise on economy optimism, oil's decline

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T180848Z_01_N20299646_RTRIDST_0_MARKETS-STOCKS-UPDATE-10.XML

NEW YORK, July 20 (Reuters) - U.S. stocks rose on Wednesday, erasing an earlier loss, as investors focused on Federal Reserve Chairman Alan Greenspan's optimistic remarks about the economy's outlook and oil prices fell below $57 a barrel.

<snip>

Greenspan, in probably his last semiannual report on the economy to Congress as Fed chief this week, said that the U.S. growth outlook was solid and the Fed should keep raising interest rates.

Higher rates are seen as bad for stocks as they raise companies' borrowing costs and weigh on profits.

"The economy is basically doing well, and he's got some concern about what inflation will do and rates are his tool," Bernie Myszkowski, director of equity investments at ABN Amro Asset Management in Chicago, said referring to Greenspan.

"I think long-term we're setting a base for a fairly decent market."

...more...

Up is Down
Black is White
War is Peace

[54anickel]

52. Today's Mogambo Quiz

http://www.kitco.com/ind/Daughty/jul202005.html

- Total Fed Credit, the marvelous, magical wellhead from which flows the fabled "money from thin air", is again sputtering and drying up, and it went down by $3.8 billion last week. Remember, it was only the week before that the Fed actually increased Total Fed Credit for the first time in a long, long time. Now it is being taken away again. But the good news is that if you squint your eyes, you can sort of see, if you tilt your head just right, what may be a slight general uptrend in new money and credit over the last month or so. Of course, for years before that, Total Fed Credit always went up like exploding rockets, and that is where the bubbles and booms came from. So this is quite a radical departure from their usual modus operandi.


But $3.8 billion in a week ain't much, although this remarkable slowdown in creation of new Fed Credit is, as you can probably tell by the way I am curled up in a fetal position and vomiting blood in fear, very bad news. Very, very bad news. And if the lack in growth of Fed Credit continues, it will continue to be worse and worse news. This is because for all prices to go up, somebody has to fork over more money, but if no more money is being created, then all prices cannot continue to go up. SOME prices will, of course, continue to go up, especially real estate, as we butthead Americans demonstrate world-class stupidity by buying houses that are so overly expensive that they actually stopped being merely expensive a long, long time ago, and are now in that weird, parallel Twilight Zone world where they would call it "bizarre" and Homer Simpson would call it "bubble-licious!" But without more money in the system, it's a zero-sum game, and so for some things to go up in price, other prices will have to, to compensate, go down. Probably a lot.


Fortunately, foreigners are still buying US debt and stashing it at the Fed, and that account increased by $4.7 billion last week, which is about par for the course for them, maybe a little on the upside.


And of course the Treasury was out there selling debt, and as of today it has risen to $7.852 billion. So the part of that number to the right of the decimal point is "billions" of dollars, so that ought to give you some idea of how freaking much money we are talking about a lot of money. Audience shouts "How much money?" Mogambo answers, "A LOT of money!" The government has borrowed $25 billion in just the last two weeks alone!


But it is not just the federal government. Oh, nooOOOoooo! It's damn near everybody, as far as I can tell, as I gathered when I heard that Kurt Richebacher wrote, "In the quarter, overall credit skyrocketed by $2,976.1 billion, close to $3 trillion, at annualized rate". I admit I gulped, and a lump formed in my throat, and my heart is pounding, and I'm thinking that this is another heart attack at the same time as my brain is starting to comprehend the enormity of so much debt, then I get this mental flash that maybe this heart attack business is a good thing because I am not sure I want to live if this debt thing means what I think it means. And I am pretty damned sure that it means what I think it means.

more...

[UpInArms]

54. Fitch pushes Ford debt toward junk

http://www.marketwatch.com/news/print_story.asp?print=1&guid={47B09AE1-ACB9-4989-9988-32299DC90B97}&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Fitch Ratings on Wednesday pushed Ford Motor's debt one notch closer to junk, a day after the No. 2 U.S. automaker posted a 19% second-quarter earnings decline.

In midday trading on the New York Stock Exchange, shares of Ford (F: news, chart, profile) were off 17 cents, or 1.6%, at $10.67.

Fitch downgraded Ford's senior unsecured debt to BBB- from BBB with a negative outlook, citing a sharp decline in demand for its big truck and SUV lineup, as well as restructuring-related spending.

The ratings agency said, however, that it expects that Ford and its financial division will remain at investment grade through 2005, "as recent product performance and very healthy liquidity provide Ford with the time and resources to address structural cost issues."

Standard & Poor's already slashed Ford's debt to junk back in May, and Moody's is currently reviewing it for a downgrade.

...more...

[UpInArms]

57. 3 title insurers to pay $37.8M to settle Calif. probes (kickback schemes)

and they only have the consumer's best interest in mind :rofl:

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38553.5651058449-838939175&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- California Insurance Commissioner John Garamendi said Wednesday that Fidelity National Inc. (FNF) , First American Corp. (FAF) and LandAmerica Financial Group Inc. (LFG) have agreed pay $37.8 million to settle investigations into alleged kickback schemes that cost home buyers $25 million.

Where's the $25 million???

:banghead:

[UpInArms]

61. Moody's may cut International Paper's debt rating

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T175750Z_01_WNA4965_RTRIDST_0_TIMBER-IP-MOODYS-URGENT.XML

NEW YORK, July 20 (Reuters) - Moody's Investors Service on Wednesday said it may cut its debt ratings on International Paper Co.(IP.N: Quote, Profile, Research) because a proposed restructuring may not improve credit measures enough to keep the current rating.

International Paper on Tuesday said it will shed timberlands and consolidate plants as part of a huge overhaul aimed at exiting sluggish markets and focusing on more profitable businesses. Although the transformation may include debt reduction, credit protection measures may continue to lag Moody's targets, the rating agency said in a statement.

Moody's said it may cut International Paper's senior unsecured rating, now "Baa2," two steps above junk status, and its "P-2" commercial paper rating. Ratings downgrades usually raise borrowing costs.

...short newsblurb...

[UpInArms]

66. Moody's cuts Discover Bank's ratings

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T155928Z_01_WNA4936_RTRIDST_0_FINANCIAL-DISCOVERBANK-MOODYS-URGENT.XML

NEW YORK, July 20 (Reuters) - Moody's Investors Service on Wednesday said it had cut Discover Bank's ratings, citing the possible spin-off of Discover from Morgan Stanley (MWD.N: Quote, Profile, Research).

Moody's cut Discover's deposit rating three notches to "A3," the seventh highest investment grade level, from "Aa3." A ratings cut can increase a company's borrowing costs.

Moody's affirmed Morgan Stanley's "Aa3" debt rating with a negative outlook. A negative outlook indicates the rating may be cut in the next 12 to 18 months.

...very short newsblurb...

What a GREAT ECONOMY!!!!

[UpInArms]

71. U.S. taxable money funds report $9.4 bln outflows

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-07-20T184559Z_01_N22MONEYNE_RTRIDST_0_ECONOMY-MONEYFUNDS-URGENT.XML

NEW YORK, July 20 (Reuters) - U.S. taxable money market funds reported $9.4 billion of inflows in the week ended Tuesday, following $8.5 billion inflows the prior week, the Money Fund Report said on Wednesday.

Tax-exempt money market funds reported $3.2 billion of outflows for the week ended Monday, a reversal of the $4.2 billion inflows the prior week, according to the report, published by iMondayNet of Westborough, Massachusetts.

Average yields for taxable funds rose 4 basis points to 2.68 percent, while average yields for tax-exempt funds rose 16 basis points to 1.69 percent.

...very short blurb...

[ozymandius]

72. 3:37 - whaaaa?

How did this happen, really?

Dow 10,668.77 +22.21 (+0.21%)
Nasdaq 2,184.92 +11.74 (+0.54%)
S&P 500 1,234.16 +4.81 (+0.39%)
10-Yr Bond 4.177 -0.12 (-0.29%)
NYSE Volume 1,754,919,000
Nasdaq Volume 1,733,229,000

[UpInArms]

74. see my post #73

Greenspan, in probably his last semiannual report on the economy to Congress as Fed chief this week, said that the U.S. growth outlook was solid and the Fed should keep raising interest rates.

Higher rates are seen as bad for stocks as they raise companies' borrowing costs and weigh on profits.

"The economy is basically doing well, and he's got some concern about what inflation will do and rates are his tool," Bernie Myszkowski, director of equity investments at ABN Amro Asset Management in Chicago, said referring to Greenspan.

Markets are just reacting normally :crazy:

[UpInArms]

75. 3:45 - is it really aiming for 10,700????

Dow 10,686.53 +39.97 (+0.38%)
Nasdaq 2,190.48 +17.30 (+0.80%)
S&P 500 1,235.94 +6.59 (+0.54%)
10-Yr Bond 4.177 -0.12 (-0.29%)

NYSE Volume 1,819,415,000
Nasdaq Volume 1,800,765,000

3:30PM: Market still off its best levels going into the close but buying remains prevalent across most industry groups... While Health Care (+1.1%) has provided the bulk of upside momentum, the Materials sector has turned in the best performance on a percentage basis... The sector has surged 1.5% after Prudential upgraded Georgia-Pacific (GP 34.71 +1.05) to Overweight and Deutsche Securities initiated coverage of Nucor (NUE 54.13 +2.58) and Phelps Dodge (PD 107.53 +2.85) with Buy ratings...

Late-day weakness in the greenback has also made dollar-denominated commodities like paper, steel and copper more attractive... NYSE Adv/Dec 2109/1143, Nasdaq Adv/Dec 1871/1141

[54anickel]

81. Hmmm, looking at the 2 year chart 10,500 seems rather unsustainable,

but what the hey, maybe the DOW will come close to 11,000 again. Just to give 'em all some excitement for the year. :eyes:

http://finance.yahoo.com/q/bc?s=%5EDJI&t=2y&l=on&z=m&q=l&c=

[loudsue]

77. Kickin' it back up!

:hi: Hi, Marketeers! Quite a ride on the Market today, ey?

:kick::kick::kick:

[ozymandius]

78. at the close

Dow 10,689.15 +42.59 (+0.40%)
Nasdaq 2,188.57 +15.39 (+0.71%)
S&P 500 1,235.20 +5.85 (+0.48%)
10-Yr Bond 41.77 -0.12 (-0.29%)
NYSE Volume 2,041,917,000
Nasdaq Volume 2,005,852,000

blather still out

[ozymandius]

79. still no blather - so there's this:

Dow Ends Up 43 on Solid Earnings Reports

NEW YORK (AP) -- Stocks turned higher Wednesday after Federal Reserve Chairman Alan Greenspan delivered an upbeat assessment of the economy and Wall Street focused on the solid earnings reported by a growing number of companies.

-cut-

The market opened lower as investors punished Intel Corp. and Yahoo Inc. after their earnings reports, issued following the close of regular trading Tuesday, fell below analysts' expectations. Stocks briefly slid further after Greenspan told Congress that the economy should enjoy sustained growth with low inflation in coming months, a sure sign incremental interest rate hikes would continue.

But the selloff didn't stick -- additional rate increases have long been expected. The market tends to fall when Greenspan starts talking and gain when he's done, said Todd Leone, managing director of equity trading at SG Cowen Securities.

"It's the uncertainty" that pushes stocks down, Leone said. "You never know what he's going to say, but today he said what everyone expected."

more...

http://biz.yahoo.com/ap/050720/wall_street.html?.v=25

Have a great evening!

Ozy :hi:

[UpInArms]

80. closing blather

(guess they had to figure out how to spin the lies)

The market showed its toughness in the face of large-cap quarterly disappointments, as a sell-off in oil prices and a turnaround in the Treasury market helped investors refocus on the quarter's broader earnings picture and close virtually every sector to the upside... Stocks opened lower after mediocre Q2 reports from Intel (INTC 27.05 -1.66) and Yahoo (YHOO 33.57 -4.16) failed to impress investors last night, weakening overall sentiment following yesterday's earnings-induced rally... General Motors (GM 36.32 -0.51), which posted a huge loss of $0.59 a share versus an expected profit of $0.03, also weighed on early trading, as the absence of schedule economic reports placed even more emphasis on earnings and guidance... To that end, comments from Fed Chairman Alan Greenspan provided an additional sense of uncertainty... While Greenspan said the economy is on firm footing and inflation remains contained, he also said that the Fed must continue to raise interest rates, so long as high energy costs put pressure on consumer prices... However, upon further analysis of his testimony amid a sell-off in oil prices, a recovery in the bond market and the foregone conclusion that more rate hikes are expected, investors embraced the possibility that Q2 aggregate EPS growth for the S&P 500 should still check in above a previously expected 7%, especially after 16 out of 23 S&P 500 constituents reporting results this morning beat analysts' forecasts... Pacing the way to the upside was the Materials sector, getting a boost from a analyst upgrades on Georgia-Pacific (GP 34.71 +1.05) and Vulcan Materials (VMC 69.59 +2.82), upbeat commentary Deutsche Securities on NUE (+4.8%), ATI (+4.0%) and PD (+2.7%) and a reversal in the dollar... The greenback had traded near its best levels since May 2004 against the yen (113.35) after Greenspan gave no indication the Fed will pause its rate hiking campaign... Health Care also surged, following strong Q2 reports from Pfizer (PFE 27.40 +0.02) - which also raised FY05 EPS guidance - and Amgen (AMGN 78.48 +7.96), which topped $100 bln in market cap for the first time ever... Another influential leader to the upside was the Industrials sector, which benefited from a strong Q2 report and upside FY05 guidance from Honeywell (HON 37.93 +0.33), better than expected earnings from General Dynamics (GD 113.60 +3.03) and a 3.6% surge in Transportation... Trucking stocks got boost after CNF Inc. (CNF ) nearly doubled Q2 profits and issued upside Q3 guidance, while Railroads (i.e. BNI, NSC, CSX, UNP) advanced after Canadian National Railway (CNI 62.82 +2.62) raised its FY05 EPS outlook and approved a 16 mln share buyback program...

The interest-rate sensitive Financial and Utilities sectors also closed to the upside, benefiting from the late-day reversal in bonds...

The benchmark 10-year note closed up 5 ticks to yield 4.16% as traders breathed a sigh of relief after Greenspan said nothing new to rattle the market...

Despite oil prices ($56.72/bbl -$0.74) falling 1.3% after the EIA indicated diminishing pressure on oil inventories, Energy posted a modest gain...

The EIA reported a smaller than expected draw in crude oil supplies of 900K barrels (consensus -3.5 mln), a larger build in distillates 2.2 mln (consensus +1.7 mln) and a 1.3 mln barrel decline in gasoline inventories (consensus -1.5 mln)...

Even though the Nasdaq inched into positive territory for the year and closed at a 4-year high, Technology failed to close to the upside following the weakness in INTC and YHOO...

Despite the drubbing in Intel, chip stocks got a boost after Teradyne (TER 16.46 +2.75) posted a narrower than expected loss on strong revenues and boosted Q3 outlook...

..NYSE Adv/Dec 2297/996. ..NASDAQ Adv/Dec 1989/1053.

[54anickel]

82. WTF?

the Fed must continue to raise interest rates, so long as high energy costs put pressure on consumer prices...