STOCK MARKET WATCH THREAD...Tuesday, October 14, 2003

[Maeve]

Tuesday, October 14, 2003

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 468
REICH-WING RUBBERSTAMP-Congress = DAY 330
DAYS SINCE DEMOCRACY DIED (12/12/00) 2 YEARS, 305 DAYS
WHERE'S OSAMA BIN-LADEN? 1 YEAR, 363 DAYS
WHERE'S SADDAM? WHERE ARE THE WMD'S? - DAY 205
DAYS SINCE ENRON COLLAPSE = 689
Number of Enron Execs in handcuffs = 17
ENRON EXECS CONVICTED = 1
Other Arrests of Execs = 53


U.S. FUTURES & MARKETS INDICATORS

NASDAQ FUTURES..............S&P FUTURES



AT THE CLOSING BELL ON October 13, 2003
Dow 9,764.38 +89.70 (+0.93%)
Nasdaq 1,933.53 +18.22 (+0.95%)
S&P 500 1,045.35 +7.29 (+0.70%)
10-Yr Bond 4.255% +0.007

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

DOW…...........NASDAQ…........S&P (auto-update, hit refresh/reload)


GOLD, EURO, YEN and Dollars


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

PIEHOLE ALERT

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

For information on protests and other actionsCitizens For Legitimate Government
~~~~~~~~~~~~~~

[Maeve]

1. Wrap-up by Jim Puplava

Main Street
It has been the best of times and the worst of times, depending on your perspective. Economists are calling the recession of 2001 the mildest downturn in recent memory. Stocks went down as company profits fell, but consumer spending remained firm putting a floor underneath the economy. Although stock prices plummeted during the last three years, the loss in equities has been made up by housing appreciation.

Your Home
A rising housing sector has acted as fuel for the economy with strong residential construction spending feeding into other sectors of the economy. It has kept raw material prices strong from cement to lumber and has spurred sales in other sectors from home appliances and furniture to gardening. More importantly, strong housing appreciation has allowed consumers to keep up their spending spree by enabling households to monetize real estate inflation through home equity loans and cash out financings. Last year cash out financing allowed consumers to pull out over $200 billion in equity from their homes which went towards consumption
<snip>
This market--like the economy--rests on a false set of assumptions and hopes. The economic numbers are getting better, but they are heavily massaged. The earnings numbers are improving, but they are also reconfigured. Stocks continue to trade up on fictional earnings and Wall Street pretends to not know the difference. Everyone is celebrating because prices are up and that is all anyone is paying attention to. The rising debt levels of the consumer, rising mortgage delinquencies and maladjusted corporate balance sheets are ignored. The focus has been on rising prices, rising home prices and rising equity prices. The bubble in housing and the return of the stock market bubble is ignoring deteriorating economic and financial fundamentals. The debt levels look good only when compared to inflated home and equity prices. All anyone cares about is that prices are rising again for stocks and housing inflation continues.

[starroute]

11. Article at Salon questions some of these assumptions

http://www.salon.com/tech/feature/2003/10/13/bankrupt_parents/index_np.html

"Americans are not going broke over lattes!"
Home mortgages, insurance and, above all, children are driving middle-class parents into bankruptcy, says Harvard law professor and author Elizabeth Warren.

The point it makes it that there has been no consumer "spending spree." The middle class is spending far less now on discretionary purchasing that it did 30 years ago. Most of its money is going into basics -- housing, energy, food, insurance, and education -- and people are slipping into debt just to keep their heads above water.

It also emphasizes that a system based on two-income families has far less resilience than one based on single-income families. If either spouse loses a job, becomes ill, or has an aging parent to care for, the family has no back-up source of revenue.

Sobering reading -- and well worth sitting through the advertisement for a one-day pass to read it.

[Maeve]

12. Good one--Newsweek ran an article on that book a couple weeks back

"The Two-Income Trap: Why Middle-Class Mothers & Fathers are Going Broke."

Elizabeth Warren, a professor at Harvard Law School, and her daughter, Amelia Warren Tyagi, a former McKinsey consultant, studied nearly 2,000 families that had gone bankrupt in the U.S. They analyzed myriad federal data detailing what Americans are actually spending their money on today compared to the legendarily more austere 1970s. What they discovered shocked even themselves: the effort to keep the kids in a good school district when one parent is laid-off is the main factor driving Americans into bankruptcy court, not all those trips to the Niketown store.
<from the Salon article>

[JNelson6563]

13. ah yes, "children"!

"Home mortgages, insurance and, above all, children are driving middle-class parents into bankruptcy"

Between my son playing the cello, my daughter playing the violin and also having braces, just those come to $320 per month. It's expensive to raise kids.

Julie

[Maeve]

2. 9:58 update

After an initial drop, the indices are rising a bit
Dow 9,749.49 -14.89 (-0.15%)
Nasdaq 1,928.44 -5.09 (-0.26%)
S&P 500 1,042.58 -2.77 (-0.26%)
10-Yr Bond 4.338% +0.083

[JNelson6563]

3. Good morning Maeve!

Well it looks a little cloudy to start. Before I left the house to pump up the economy futures looked a bit flat and this thread wasn't posted yet. After Ozy's warning they'd be real early now I figured you may be in the Author column on today's thread. ;-)

Interesting wrap-up info on housing and equity. All that equity that was spent on consumption has not been rebuilt already and, I am sure, the black hole of debt still remains for many of these home-owners. I am still haunted by the quotes in yesterday's wrap-up from the '29 crash/depression era. Sobering stuff.

10:36 and things are looking up a bit:


Dow 9,757.49 -6.89 (-0.07%)
Nasdaq 1,932.20 -1.33 (-0.07%)
S&P 500 1,043.70 -1.65 (-0.16%)
10-Yr Bond 4.335% +0.080


Will check back in a bit! :hi:

Julie

[Code_Name_D]

5. Don't look out the window now! What ever you do, don't look out their.

I normaly hang out in the economics room, where we don't perticerly care much about the ups and downs of the market. But watching the economic figures, we are shaking our heads just as hard as you folks as the markets contiues to go up and up.

The storm clouds have been on the horizen for some time now. But now they are starting to rumble and thunder. Rusha recently switched to the Eruo. And while this dosn't have any direct effect on the dollar, it has got a lot of other contries talking.

They are talking about a run on the dollar. Non-US economist are scared. They are realy and truly scared, and its hard not to see it in the post shared down in the economics room. Some of the wizer market systems may be working to cut the ties that bind them to the dollar, in hopes of aviding its fate. Adding to the dive of the dollar much talked about here.

Safe to say that much of the US markets thinks the edge of the world is marked by the boundry of Manhaten. But what do you guys think of this?

[JNelson6563]

6. agreed

The world revolves around us! Everybody knows that! ;-)

Julie

[Maeve]

8. We've compared it to Wile E. Coyote

Running off the cliff, but not falling until he looks down.

The Stock Thread started last year when the bubble deflated--some of us are of the opinion this year's rally is simply another bubble. The economic basics are such, I'm AFRAID to go down to the econ forum! :tinfoilhat:

But then, I'm a pessimist.

[mrsteve]

22. Ha! Paul Krugman agrees -

Good visualization, Maeve - one of our favorite (ours, as in DU's) columnists used that exact phrase:

"But at a certain point we'll have a Wile E. Coyote moment. For those not familiar with the Road Runner cartoons, Mr. Coyote had a habit of running off cliffs and taking several steps on thin air before noticing that there was nothing underneath his feet. Only then would he plunge."

Maybe he reads DU, hmmm?

But this is only after he has already said very :scared: scary things, such as this from the thir paragraph:

"And there's one thing I can't help noticing: a third world country with America's recent numbers — its huge budget and trade deficits, its growing reliance on short-term borrowing from the rest of the world — would definitely be on the watch list.

I'm not the only one thinking that. Lehman Brothers has a mathematical model known as Damocles that it calls "an early warning system to identify the likelihood of countries entering into financial crises." Developing nations are looking pretty safe these days. But applying the same model to some advanced countries "would set Damocles' alarm bells ringing." Lehman's press release adds, "Most conspicuous of these threats is the United States.""

[Maeve]

4. 10:50 and another light trading day

Lots of earnings reports coming out, but haven't had time to look and see if they are "heavily massaged" numbers or not (y'all know by now my suspicions--if you don't, read the Puplava wrapup!)

I've got a lot coming up the next few weeks, so I hope someone can help take up the slack around here...


Dow 9,743.57 -20.81 (-0.21%)
Nasdaq 1,928.15 -5.38 (-0.28%)
S&P 500 1,042.08 -3.28 (-0.31%)
10-Yr Bond 4.336% +0.081

[JNelson6563]

7. update and some earnings blather

<snip>

Strong results from Johnson & Johnson were good for a 1.6 percent rise in the stock, but broad selling overwhelmed the gain's influence on the Dow's direction. 21 of the blue chip index's 30 components moved marginally lower in morning trades.

The sell-off didn't display much conviction though as not one component was off more than 1 percent.

Intel was among the leading losers, giving back 0.6 percent to $30.61. The average estimate of thirty analysts polled by Thomson First Call is for a profit of 23 cents per share from the chip giant in the September quarter.

<snip>

Johnson & Johnson reported third-quarter earnings of $2.1 billion, or 69 cents per share, a penny ahead of Wall Street's consensus. Sales at the New Brunswick, N.J., healthcare products giant jumped 15.2 percent in the latest three months to $10.5 billion from $9.1 billion in the same period a year earlier.

<snip>

In the financial sector, Merrill Lynch (NYSE:MER - News) sank almost 2 percent despite a strong report from the brokerage giant. Merrill posted third-quarter earnings of $1.04 billion, or $1.04 a share, well above the average analyst forecast compiled by Thomson First Call for a profit of 87 cents a share.

Banc of America (NYSE:BAC - News) , however, managed a tiny gain after the company reported third-quarter net income of $2.92 billion, or $1.92 a share, up from $1.45 a share in the year-earlier period, and well above the average analyst estimate compiled by Reuters Research of $1.69 a share.

http://biz.yahoo.com/cbsm-top/031014/2d61fb84ed3e551b8a7b62580b129121_1.html

As of 11:54 here's how it's lookin':

Dow 9,746.38 -18.00 (-0.18%)
Nasdaq 1,929.34 -4.19 (-0.22%)
S&P 500 1,042.49 -2.86 (-0.27%)
10-Yr Bond 4.304% +0.049


Kind of dull day. Slight bruising in Treasuries.

Will check back in a bit. Working on large mailing for my local Dem party.

Julie

[Maeve]

9. Ten minutes later and more sell-offs

What happened to the lunchtime lull? :shrug:

Dow 9,734.31 -30.07 (-0.31%)
Nasdaq 1,927.79 -5.74 (-0.30%)
S&P 500 1,041.24 -4.11 (-0.39%)
10-Yr Bond 4.308% +0.053

[JNelson6563]

10. Buck up Johnny! Here comes the sun!

12:34 and it's getting a little brighter:

Dow 9,746.38 -18.00 (-0.18%)
Nasdaq 1,929.34 -4.19 (-0.22%)
S&P 500 1,042.49 -2.86 (-0.27%)
10-Yr Bond 4.304% +0.049

Julie

[Maeve]

14. 1:42 update with a side of blather

1:30PM: Major indices remain confined to their tight trading ranges with no influential leadership to speak of... Retail, financial, oil service, homebuilding, and cyclicals have traded to the downside, and kept the broader market in negative territory.... The Nasdaq has also registered losses, although its weakness has been offset by slight gains in semiconductor, software, disk drive, internet, and biotech...
http://finance.yahoo.com/mo

Dow 9,762.01 -2.37 (-0.02%)
Nasdaq 1,932.18 -1.35 (-0.07%)
S&P 500 1,043.78 -1.57 (-0.15%)
10-Yr Bond 4.314% +0.059

[Maeve]

15. 2:04 and in the BLACK

Dow 9,790.01 +25.63 (+0.26%)
Nasdaq 1,937.83 +4.30 (+0.22%)
S&P 500 1,047.04 +1.69 (+0.16%)
10-Yr Bond 4.304% +0.049

However:
2:00PM: Indices spike higher in manner consistent with a buy program kicking in...that would reflect buying in the futures, leading to arbitrage buying of the cash securities...if that is the cause, it probably won't provide sustained push...
http://finance.yahoo.com/mo

[JNelson6563]

17. 2:34 still black

hanging in there:


Dow 9,789.20 +24.82 (+0.25%)
Nasdaq 1,937.94 +4.41 (+0.23%)
S&P 500 1,047.29 +1.94 (+0.19%)
10-Yr Bond 4.334% +0.079

10yr up almost 10 basis pts. Ouch.

Julie

[ozymandius]

16. I would've been here sooner if Earthlink were working!

Hi all. Earthlink was down in the Atlanta area this morning - not to be up sooner than I was able to wait.

Thank you! :donut: Thank you! :donut: Thank you! :donut: Maeve!

[mrsteve]

18. Let me second Ozy's thank yous

And give my own apologies for not posting - the customer is running around knocking holes in our carefully constructed little boats today, and I am one of the lead bailers. Hope to catch up with a Stock Thread review later tonight.

[Maeve]

20. Ni habairt e--da nada--don't mention it!

It's a dirty job, but somebody has to do it! :P

[JNelson6563]

21. *yawn* You didn't miss much

Hope you were able to patch all the holes. Looks like some magnificent patch-work on the Street today:

With a few pennies to shake out yet, closing looks like:


Dow 9,810.38 +46.00 (+0.47%)
Nasdaq 1,943.18 +9.65 (+0.50%)
S&P 500 1,049.31 +3.96 (+0.38%)
10-Yr Bond 4.350% +0.095


The indices fared alright in the end with moderate bruising in Treasuries.

Goodnight fellow marketeers!!

Julie

[Maeve]

19. A slow day, but a cheerful afternoon

I don't know and maybe it's just me, but it does seem that a lot of the up days happen when not many traders are shifting stock. :shrug:
Almost at the end and a bit of upsurge...

Dow 9,808.23 +43.85 (+0.45%)
Nasdaq 1,942.89 +9.36 (+0.48%)
S&P 500 1,049.18 +3.83 (+0.37%)
10-Yr Bond 4.350% +0.095