STOCK MARKET WATCH, Tuesday 9 August

[ozymandius]

Tuesday August 9, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 165 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 232 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 296 DAYS
DAYS SINCE ENRON COLLAPSE = 1353
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 August 8, 2005

Dow... 10,536.93 -21.10 (-0.20%)
Nasdaq... 2,164.39 -13.52 (-0.62%)
S&P 500... 1,223.13 -3.29 (-0.27%)
10-Yr Bond... 4.42% +0.03 (+0.61%)
Gold future... 440.30 -2.50 (-0.57%)

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 Rob Kirby

TWILIGHT AT THE FED: SUBLIMINAL PARALLELS

I couldn’t help but get a sense of déjà vu all over again with Jim Puplava’s interview of Matt Simmons this weekend, Aug. 6, 2005, on the Financial Sense News Hour. That would be Matthew Simmons - Chairman of Simmons & Company International and author of "Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy.” Specifically - what got my goat, so to speak, was Matt’s revelations regarding two years of service he put in on an energy supply workshop a few years back – at the behest of energy analysts at the CIA – whose purpose was to ‘model’ or predict world oil output/supply by geographical region going forward.

Simmons reveals the methodology employed by the other 9 experts on that panel as it related to China’s future oil production. These experts had Chinese oil production rising with demand in future years. That Chinese oil production would increase - was simply assumed! This prompted Simmons to ask questions like; how anyone knew for a fact that China could increase supply? And could anyone making these claims even identify the top two or three oil fields in China? As you might have already guessed, no one had answers to these questions. There was no provable basis for the assumptions that China would be able to increase oil production. This got Simmons thinking more about the bigger picture and he wanted to know if there existed a list of, say, the top 20 largest oil field in the world? He was astonished to learn that no such list had ever been compiled.

This led Simmons, in 2001, to begin compiling a list of the largest oil fields in the world. In doing so, he arbitrarily used 100,000 barrels of production per day as a cut off point as to what large is. His study found that there is roughly 120 oil wells in the world that meet this description and together they constitute roughly 49% of the world’s oil supply . Furthermore, the top 14 of the illustrious 120 wells that produce more than 500,000 barrels per day constituted 20% of the world’s supply and the average age of these magnificent 14 wells was in excess of 50 years. Then, when focusing on Middle Eastern oil producers, he found that each producing country had somewhere between 3 and 5 major wells that accounted for approximately 90% of its production.

-cut-

What Jim Puplava points out, is that all oil supply modeling done in the world today is largely predicated on the notion that Saudi Arabia, currently producing at close to full bore, has vast resources of ‘cheap’ oil to still be tapped and can do so in a timely fashion as demand increases. Simmons points out the amazing thing about these assumptions; they have been made without any supporting data. The scenario above makes it clear just how ‘wishful thinking’ these rosy assumptions are. The cheap easy flowing oil is in increasingly finite supply and this makes the world more and more dependant on heavier, more expensive, slower flowing / thicker grades of crude. So while oil supplies will never run out altogether, new supply is likely to be comprised of much more expensive oil which by its very nature will not be available at ample flow rates commensurate with existing stocks that are quickly depleting.

more...

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

[UpInArms]

2. daily dollar watch

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

Last trade 87.90 Change -0.02 (-0.02%)

Dollar Tries To Revive Its Former Glory

http://www.dailyfx.com/index.php?option=com_content&task=view&id=2747&Itemid=39

EUR/USD – Euro bulls launched another attack against the dollar bulls with initial charge testing the offers above the 1.2400 figure. As single currency longs remain in an anti-dollar mode, a sustained break above 1.2400 handle will most likely see the pair head toward the psychologically important 1.2500 level, which is right above the 1.2483 level, a level marked by the key 38.2 Fib of the 1.3477-1.1869 USD rally. A break above the 1.2500 will most likely see the pair test the next round of dollar defenses around 1.2650, right below the 50.0 Fib of the 1.3477-1.1869 USD rally. Indicators remain supportive of the move to the upside with the momentum indicator above the zero line and MACD sloping upward toward the zero line while Stochastic became extremely overbought thus signaling to the euro longs that they can become vulnerable to the countermove by the greenback bulls.

<snip>

USD/JPY – Japanese Yen longs went on offensive with the pair falling below the 112.00 figure after the yen traders successfully defended the 113.00 level from the greenback longs. As the pair heads lower, a sustained momentum below the 112.00 will most likely see the pair head lower toward the 111.00 handle, with a break to the downside testing the dollar bids around the 110.07, a 38.2 Fib of the 104.18-113.74 USD rally, which is further reinforced by the psychologically important 110.00 handle. Indicators continue to favor a move to the downside with momentum indicator crossing below the zero line , MACD sloping toward the zero line and with both oscillators remaining in a neutral territory, thus giving either side enough room to maneuver.

...more...

Dollar down before expected rate hike

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-08-09T114640Z_01_L09313168_RTRIDST_0_BUSINESS-MARKETS-FOREX-DC.XML

LONDON (Reuters) - The dollar hit two-month lows against the euro and Swiss franc on Tuesday as investors viewed an expected Federal Reserve interest rate hike later in the session as unlikely to offer support for the U.S. currency.

The dollar's rally has stalled in recent weeks despite upbeat U.S. economic data and expectations that the Fed will continue to raise interest rates as the greenback has already enjoyed a gain of nearly 10 percent since January.

"We won't see big moves today in anticipation of the FOMC statement. The risk is out there that the Fed could be a bit more hawkish... We still expect the Fed to continue its measured interest rate hikes until the end of the year," said David Mann, currency strategist at Standard Chartered.

"But good news is in the price and dollar positives are running out. Friday's trade numbers will be a reminder for U.S. structural imbalances."

Some analysts said oil prices, which hit a record high above $64 a barrel on Tuesday due to Middle East security concerns, weighed on the U.S. currency.

...more...

Have a Great Day Marketeers!

[UpInArms]

11. Dollar sees limited movement after U.S. productivity data

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38573.3662914931-840194874&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

CHICAGO (MarketWatch) -- The dollar briefly extended its decline against the euro before clawing back and remained little changed against the yen after a U.S. report showed a slower gain in productivity and labor costs in the most recent quarter. Labor costs on a year-over-year basis, however, rose by the most since 2000. The report is seen doing little to change the near-term outlook for Fed interest rates, expected to be lifted Tuesday and by most accounts, at each of the remaining meetings this year. The euro was trading at $1.2362, rose to $1.2366 and is changing hands more recently at $1.2354, which is up 0.1% from late Monday. The dollar stands at 112.10 yen, unchanged from Monday, after falling to 112.07 yen after the report.

[UpInArms]

3. Today's Reports:

http://biz.yahoo.com/c/e.html

Aug 9	8:30 AM		Productivity-Prel		Q2	-	2.0%	2.0%	2.9%	-	
Aug 9	10:00 AM	Wholesale Inventories		Jun	-	0.2%	0.4%	0.1%	-	
Aug 9	2:15 PM		FOMC policy announcement	-	-	-	-	-	-

[UpInArms]

6. U.S. productivity decelerates to 2.2%

http://www.marketwatch.com/news/story.asp?guid=%7B80208C55%2D0559%2D475B%2D9A29%2DDB79EBE93FAC%7D&siteid=mktw

WASHINGTON (MarketWatch) - Productivity in the American workplace decelerated in the second quarter, rising at a 2.2% annual rate, the Labor Department estimated Tuesday.

Productivity rose a revised 3.2% in the first quarter, up from the 2.9% gain estimated two months ago.

Economists were expecting nonfarm business productivity to slow to about 2.0% in the second quarter. See Economic Calendar.

Unit labor costs - a key measure of inflationary pressures from compensation- increased 1.3% in the second quarter, after rising 3.6% in the first quarter.

Despite the moderation in the second quarter, unit labor costs have risen 4.3% in the past year, the fastest gain since the third quarter of 2000.

<snip>

In the second quarter, output in the non-farm business sector rose 4.4%, while hours worked rose 2.1%, the government said.

Real hourly compensation (adjusted for inflation) fell 0.6%, the biggest drop since the second quarter of 2004.

...more...

8:30am 08/09/05 U.S. Q2 LABOR COSTS UP 4.3% YR-ON-YR, BIGGEST SINCE Q3 2000

8:30am 08/09/05 U.S. Q2 UNIT LABOR COSTS UP 1.3% VS 3.6% IN Q1

8:30am 08/09/05 U.S. Q1 PRODUCTIVITY REVISED TO UP 3.2% FROM 2.9%

8:30am 08/09/05 U.S. Q2 PRODUCTIVITY UP 2.2% VS. 2.0% EXPECTED

[54anickel]

14. From yesterday - Productivity Is the Issue of the Hour for the Fed

http://www.nytimes.com/2005/08/08/business/08fed.html?

WASHINGTON, Aug. 5 - Ten years ago, Alan Greenspan, the Federal Reserve chairman, broke with conventional wisdom and correctly recognized that the United States had entered an era of faster growth in productivity.

It was a huge shift that allowed the Fed to encourage faster economic growth and increased prosperity without significant inflation.

Uhhhh, wasn't that when NAFTA was passed?

snip>

As shown by the big jump in jobs during July, up 207,000 from June, and the more than 1.3 million jobs added this year, the pool of unemployed workers is dwindling and wages are rising faster than productivity. The big question for the Federal Reserve is whether the lull is simply a return to the average pace since 1995 or a return to the doldrums that prevailed from the early 1970's to the early 1990's.

With economic growth strong and labor costs rising, Fed officials are all but certain to raise short-term interest rates on Tuesday to 3.5 percent and to increase them again to at least 4 percent by the end of the year as they grope toward a neutral monetary policy.

The issue of productivity growth lies behind much of the debate. If output climbs more slowly than labor costs, companies will be under pressure to raise prices. If output rises in line with labor costs, whether because of new technology or new ways of doing business, wages and employment can rise without contributing to inflation.

more half truths and lies....

[UpInArms]

17. U.S. 2nd-qtr productivity, labor cost growth slow

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2005-08-09T123102Z_01_N08347976_RTRIDST_0_ECONOMY-PRODUCTIVITY-URGENT.XML

WASHINGTON, Aug 9 (Reuters) - U.S. business productivity growth slowed in the second quarter but an easing in the pace of compensation gains kept labor costs in check, a government report showed on Tuesday.

The Labor Department said growth in non-farm business productivity, or worker output per hour, rose at a 2.2 percent annual rate in the second quarter after an upwardly revised 3.2 percent first-quarter gain.

However, unit labor costs - a key inflation and profit pressure gauge - rose at a mild 1.3 percent pace, well below the first quarter's revised 3.6 percent advance.

Wall Street economists had expected productivity to rise at a 2 percent annual rate in the second quarter, with unit labor costs up 2.8 percent.

The slower-than-expected rise in unit labor costs could temper inflation worries in financial markets that might otherwise be sparked by signs of slowing productivity growth.

...more...

[54anickel]

22. Doesn't the attention given to productivity seem rather out of place.

I mean, we're in Greenspin's "New Economy" - we don't produce jack-shit!!! It's all finance, all the time - that seems to be where the jobs are. So, if the Fed is raising rates aren't they themselves in a way raising the cost of the goods (credit) so the producers don't have to? :crazy:

[54anickel]

20. U.S. 2Q Productivity Rises 2.2%; Labor Costs Gain

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aupYqKFx6P6Y&refer=home

Aug. 9 (Bloomberg) -- The productivity of U.S. workers grew from April through June at the slowest pace in nine months and labor costs accelerated from a year earlier, a government report showed.

Productivity, a measure of how much an employee produces for every hour of work, rose at a 2.2 percent annual rate compared with a 3.2 percent increase the previous three months, the Labor Department said today in Washington. Labor costs rose 4.3 percent from a year earlier, the biggest increase in almost five years.

Companies that have previously relied on gains in efficiency are now having to hire more workers to help meet demand, as businesses added 584,000 employees and increased the number of hours worked last quarter. Rising labor costs that threaten to boost inflation support forecasts that Federal Reserve policy makers will extend their series of interest-rate increases through the first half of next year.

``Nothing in the report suggests a deviation from the Fed's measured pace of interest rate increases,'' Dean Maki, chief U.S. economist at Barclays Capital Inc. in New York, said in an interview. ``Slower productivity growth and rising year-over-year labor costs will push the Fed to keep raising rates.''

Among companies adding workers is Citigroup Inc., the biggest U.S. financial-services company, which said last week it will hire 200 as it expands a credit-card services facility in Urbandale, Iowa, near Des Moines. Oh, the irony :evilfrown:

more...

[UpInArms]

4. US chain store sales fall in the latest week-ICSC

http://today.reuters.com/investing/FinanceArticle.aspx?type=economicNews&storyID=URI:urn:newsml:reuters.com:20050809:MTFH75351_2005-08-09_11-46-24_NAT001737:1

NEW YORK, Aug 9 (Reuters) - U.S. chain store retail sales fell for the first time since June 25, as August got off to a slow start with consumers shopping for fall apparel, a retail report said on Tuesday.

Sales fell 0.8 percent in the week ended Aug. 6, compared with a 0.9 percent increase the previous week, the International Council of Shopping Centers and UBS said in a joint report.

Compared with the same week a year ago, sales softened to a 4.0 percent increase after a 4.9 percent rise the preceding week.

"During the past week seasonally hot weather pared demand for fall apparel," said Michael Niemira, ICSC's chief economist and director of research.

...more...

[UpInArms]

5. Fed seen raising rates for the 10th time

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-08-09T061327Z_01_N08663804_RTRIDST_0_BUSINESS-ECONOMY-FED-DC.XML

WASHINGTON (Reuters) - The Federal Reserve was expected to ratchet up U.S. interest rates on Tuesday by a quarter-percentage point for the 10th straight time and will likely signal further increases ahead, economists say.

With mounting signs the economic pulse is quickening, the U.S. central bank's policy-setting Federal Open Market Committee was set to not only push rates modestly higher but also repeat its view that further "measured" rises are likely.

A quarter-point hike would take the overnight federal funds rate, which governs interbank lending and influences borrowing costs throughout the economy, to 3.5 percent, its highest level in four years.

The FOMC is set to gather at 9 a.m. (1300 GMT) and will announce its decision on rates around 2:15 p.m. (1815 GMT).

...more...

[UpInArms]

7. Fuel costs stagger business

http://www.signonsandiego.com/news/business/20050809-9999-1b9oil.html

It's hard to complain when business is good. But Mike Hurley, a veteran of 30 years in the trucking business, is willing to make the case.

Hurley owns a 16-truck operation in Spring Valley that haul rocks, dirt and other raw materials for the region's booming construction industry. But he says what should be strong profits for Kelly & Associates are getting erased by $12,000 to $15,000 more each month in diesel costs.

"We can't pass on the fuel costs fast enough to recoup the increases," said Hurley, who noted that diesel costs have risen about 50 cents in two weeks. "We're not making what we should be making in a booming business."

There's little relief in sight.

Crude prices for September delivery closed yesterday on the New York Mercantile Exchange at $63.94 a barrel, up $1.63, or 2.6 percent, after climbing as high as $64 shortly before the end of the regular session. Oil prices have risen 47 percent this year.

...more...

[RUMMYisFROSTED]

12. Saw diesel at $3.24 in Western Nevada. nt

[UpInArms]

13. Oil near record with Middle East in focus

http://today.reuters.com/news/newsArticle.aspx?type=topNews&storyID=2005-08-09T121926Z_01_L09412732_RTRIDST_0_NEWS-MARKETS-OIL-DC.XML

LONDON (Reuters) - Oil held near its record high of $64 a barrel on Tuesday as traders worried a nuclear stand-off with Iran and possible militant strikes in Saudi Arabia could disrupt crucial Middle East exports.

The United Nations' nuclear watchdog was to hold an emergency meeting in Vienna after OPEC's second biggest producer Iran restarted work at a uranium conversion plant, defying the European Union and running a risk of U.N. sanctions.

In the world's top exporter Saudi Arabia, U.S. missions were shut for a second day because of security concerns. Britain said militants were in the "final stages" of planning attacks.

"By far the biggest jolt to the markets has come from the geopolitical front," said Edward Meir, an analyst at Man Energy.

...more...

[UpInArms]

16. Cost of oil not slowing drivers

http://www.chicagotribune.com/news/nationworld/chi-0508090175aug09,1,1326770.story?coll=chi-newsnationworld-hed

Oil and retail gasoline prices hit record highs again Monday, propelled by threats to the American Embassy in Saudi Arabia and problems at U.S. refineries.

But even as prices continue to rise, industry observers said they are seeing no change in consumer behavior.

People continue to drive to work despite higher prices at the pump, and the stock market has largely shaken off the effect of higher energy costs.

"It's awfully hard ... to switch commuting modes in great numbers," said Donald W. Jones, senior economist with Chicago-based RCF Economics and Financial Consulting Inc., who said his study of census data shows that so far there is no big surge of people getting out of their vehicles to ride public transit.

Jones said consumer behavior will change if the public perceives that high gas prices are permanent and not a temporary phenomenon, but so far that has not happened.

Oil traders turn on a dime, however, and Monday they bid up the price of oil after it was disclosed Sunday that the U.S. Embassy in Saudi Arabia had closed for at least two days because of security threats.

Crude oil rose to an intraday record of $63.99 a barrel on the New York Mercantile Exchange before closing up $1.63, at $63.94. That broke the previous record close of $62.31, set Friday.

...more...

[UpInArms]

8. J.P. Morgan may face SEC charges over Century Financial

http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid=%7BD24AB02F-8D4E-46A8-934D-ED57ED981AF1%7D&

NEW YORK (MarketWatch) -- J.P. Morgan Chase & Co. (JPM) said the Securities and Exchange Commission may bring civil charges against the bank over its role with National Century Financial Enterprises (CYFL) . In a filing late Monday with the SEC, J.P. Morgan said two employees, one current and one former, may have violated securities laws when they served on the board of the directors of the company which is now operating under bankruptcy protection. Shares of J.P. Morgan fell 26 cents to close at $34.99 on Monday.

[UpInArms]

9. Blockbuster posts loss, drops forecast

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-08-09T123123Z_01_N09387142_RTRIDST_0_LEISURE-BLOCKBUSTER-EARNS-UPDATE-2.XML

CHICAGO, Aug 9 (Reuters) - Movie rental chain Blockbuster Inc. (BBI.N: Quote, Profile, Research) on Tuesday posted a quarterly loss that was more than double what analysts expected as lackluster new video releases failed to attract consumers.

The company also said it was no longer on track to meet its 2005 financial forecast.

Also Tuesday, Blockbuster said it was raising the monthly fee for its online service. The price of a three-movie plan will rise to $17.99 from $14.99 as of Aug. 19, bringing it in line with Netflix Inc.'s (NFLX.O: Quote, Profile, Research) price.

Blockbuster has been spending heavily to build an online service to compete with Netflix, while its business has also been hit by consumers buying videos at retailers like Wal-Mart Stores Inc. (WMT.N: Quote, Profile, Research) rather than renting.

...more...

[UpInArms]

10. Ford reportedly eyes more job cuts

Reports: Consolidation could lead auto maker to slash up to 25% of its sales and marketing staff.

http://money.cnn.com/2005/08/09/news/fortune500/jobs_ford_staffcuts/

NEW YORK (CNN/Money) - Ford Motor Co. is looking at cutting up to 25 percent of its sales and marketing staff, according to published reports.

The nation's No. 2 auto manufacturer will combine the now-separate marketing and field-sales staffs for its Ford and Lincoln-Mercury divisions, according to reports in The Wall Street Journal and the Detroit News on Tuesday.

The depth of the cuts was not disclosed by the company, according to the reports, but the News reports at least 15 percent -- or 525 -- of the 3,500 employees throughout Ford's marketing, sales and service staff will be affected, while the Journal reported that ultimately 20 to 25 percent of Ford's current sales and marketing staff could be affected.

The papers reported that as part of the streamlining, 34 U.S. field-sales offices for the two divisions will be reduced to 11, while six of the current 17 Ford U.S. customer-services offices also will be closed.

<snip>

In June, the Journal reported that Ford was eyeing cutting up to 30 percent of its salaried staff overall, or a reduction of 10,000 jobs, in the next few years, although Ford would not comment on the report at that time.

...more...

[54anickel]

58. Ford to Cut Costs by Shedding Sales Jobs

http://www.washingtonpost.com/wp-dyn/content/article/2005/08/09/AR2005080900681.html

snip>

The No. 2 U.S. automaker is reducing the number of regions covered by its field offices from 17 to 11 as part of the plan. The regional offices sell vehicles to Ford's 4,000 U.S. dealerships and handle local marketing. Regional customer service offices also will be cut.


Ford is closing regional offices in Boston, Philadelphia, Cincinnati, Minneapolis-St. Paul and Seattle, but will keep some staff in those cities, Lincoln Mercury spokeswoman Sara Tatchio said.

snip>

Tatchio wouldn't say how many jobs will be affected, but the Dearborn-based automaker has said it wants to cut at least 1,750 more jobs before the end of this year. Ford has 3,500 employees on its sales, marketing and service staff.

snip>

Ford spokesman Oscar Suris said Tuesday that the company's goal is to reduce its salaried work force in North America by 2,750 jobs. More than 1,000 people had left the company through buyouts and layoffs at the end of July. Ford has 35,000 salaried workers in North America.

snip>

Ford shares rose 6 cents to $10.43 in afternoon trading on the New York Stock Exchange.

more...

[UpInArms]

15. Texas Instruments bullish on India

http://inhome.rediff.com/money/2005/aug/09texas.htm

Describing its growth in India as the most "dramatic", leading analog and DSP technolgies provider Texas Instruments on Tuesday said the company would continue its expansion in India.

"We have been under massive expansion plans in India for a number of years. We will continue to expand," Thomas Engibous, chairman, Texas Instruments said while characterising TI's expansion in India as "probably one of the most dramatic that we have had in the company."

The company is expecting that China would emerge as the biggest market for its single chip solution for cellular phones launched on Monday.

TI had a "very large business" in China, which was the largest cell phone market in terms of subscribers for the last four or five years, he said.

TI was the first multinational company to set up software development facility in Bangalore in 1985. The single chip solution for mobile phones was designed and developed in Bangalore centre.

...more...

[UpInArms]

18. pre-opening blather

9:00AM: S&P futures vs fair value: +6.0. Nasdaq futures vs fair value: +9.0. Stocks still looking to rebound in the wake of recent market weakness, as futures indications trade at their best levels of the morning... While today's policy announcement is very likely to specify further rate hikes, the fact that economic growth has not slowed at all in response to nine previous tightenings, coupled with a pullback in oil prices, a favorable read on inflation and a potentially strong Q4 report from Cisco Systems (CSCO) after the bell, has helped improve underlying sentiment

8:33AM: S&P futures vs fair value: +6.0. Nasdaq futures vs fair value: +8.5. Futures trade gets a boost following economic data, indicating an even higher open for the indices... A preliminary Q2 productivity figure came in at +2.2% (consensus +2.0%) while unit labor costs checking in up just 1.3%, versus expectations of 2.9% and a prior read of 3.6%, suggests inflation remains contained... Bonds, which were relatively unchanged ahead of the report have also ticked higher, as the 10-yr note is up 4 ticks to yield 4.40%

8:00AM: S&P futures vs fair value: +4.1. Nasdaq futures vs fair value: +5.0. Futures market versus fair value suggesting a higher open for the cash market ahead of economic reports and the Fed's latest decision on monetary tightening (2:15 ET)... While the Fed is widely expected to raise rates again by a 1/4% (to 3.5%), the belief that accompanying Fed language will keep the "measured" pace of tightening could be providing a floor of support for investors looking for bargains following three consecutive market declines...

[UpInArms]

19. U.S. Fed starts policy meeting, rate hike on tap

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-08-09T130300Z_01_N09356937_RTRIDST_0_ECONOMY-FED-MEETING.XML

WASHINGTON, Aug 9 (Reuters) - Federal Reserve policy-makers began a meeting on Tuesday that economists expect will result in the 10th consecutive hike in short-term U.S. interest rates and few clues on when rate rises will end.

The central bank's rate-setting Federal Open Market Committee began meeting at 9 a.m. (1300 GMT), a Fed official said. A decision on interest rates is expected around 2:15 p.m. (1815 GMT).

Fed officials are widely expected to push up the overnight federal funds rate, which influences borrowing costs throughout the economy, by a quarter-percentage point to 3.5 percent.

Policy-makers are also expected to repeat their view that rates are still low enough to support economic activity and that the Fed is likely to continue to raise credit costs at a "measured" pace -- code for more quarter-point moves.

Minutes from the central bank's last policy session in late June showed officials had begun to debate how much further rates might need to rise.

...more...

[UpInArms]

21. Treasury investors turn cautious before FOMC-poll

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-08-09T130252Z_01_N09395239_RTRIDST_0_FINANCIAL-TREASURIES-JPMORGAN.XML

NEW YORK, Aug 9 (Reuters) - More investors investors turned cautious on Treasuries ahead of the Federal Reserve's policy meeting on Tuesday, a poll released on Tuesday shows.

The Fed's policy committee is widely expected by the market to raise its target for short-term U.S. interest rates by a quarter percentage point to 3.50 percent, a four-year high.

Investors polled on Monday who said they were neutral on Treasuries climbed to 47 percent compared with 41 percent the prior week, J.P. Morgan Securities said.

The bank's active clients, which include market makers and hedge funds, who said they were neutral on Treasuries, climbed to 9 percent from last week's 6 percent.

...short blurb...

[UpInArms]

23. Drastic Fall in Wheeling-Pittsburgh steel profits

Wheeling-Pittsburgh second quarter profit falls

http://today.reuters.com/investing/financeArticle.aspx?type=marketsNews&storyID=2005-08-09T131503Z_01_WEN7253_RTRIDST_0_MINERALS-WHEELINGPITTSBURGH-EARNS-URGENT.XML

NEW YORK, Aug 9 (Reuters) - Steelmaker Wheeling-Pittsburgh Corp. (WPSC.O: Quote, Profile, Research) on Tuesday posted a smaller profit for the second quarter on coal supply problems as well as other operational issues.

The company posted a net profit of $2.6 million, or 18 cents per share, compared with a year-earlier profit of $27 million, or $2.79 per share.

...very short blurb...

From $2.79 to .18 ???!???

[54anickel]

24. Fed's Fight Squeezes Banks, Spooks Markets

http://online.wsj.com/public/article/0,,SB112351375695107584-6U4PFQ6PFXcxC3dxWfU1S6_u9ik_20060808,00.html?mod=tff_main_tff_top

The Federal Reserve's campaign to tame inflation has created an investment rarity -- a "flattening" yield curve -- that is squeezing banks and Wall Street firms, and which in the past has presaged economic downturns.

As the Fed prepares today to raise its short-term interest-rate target for the 10th consecutive time in 14 months, to 3.50%, long-term interest rates remain stubbornly low, although they have risen in the past few weeks. That has some market watchers predicting that the difference between short and long rates -- known as the yield curve -- will disappear by year end. Under that scenario, consumers and companies would end up paying the same rate for short- and long-term loans, from certificates of deposit to long-term bonds.

A flattening yield curve removes banks' age-old profit model: Borrow money at low short-term rates and lend it out to people and companies at higher long-term rates. Already, as rates converge, banks are cutting costs to address their shrinking profit margins. "Banks are scrambling, because they have this huge amount of income that is disappearing that they need to replace," says William S. Demchak, chief financial officer of PNC Financial Services Group Inc.

Should the curve end up "inverting" -- with short rates climbing above long -- banks could lose their incentive to lend. That is one reason previous flat yield-curve inversions have signaled recessions, though some economists think this time will be different. Now, they say, falling long-term rates have offset the braking effect of the Fed's short-term rate increases, in what traders call a "bull flattening": People and companies are able to bypass banks and secure low, long-term rates from other lenders or even through the bond market, meaning they still are able to make big-ticket purchases, including that new home or factory.

"It matters a lot to Wall Street, but it's not necessarily a bad thing for Main Street," says Jim Bianco, president of Bianco Research LLC, an independent research firm based in Chicago. Rising short-term rates also boost the return on extreme short-term investments such as money-market funds -- good news for folks on fixed incomes.

more...

[54anickel]

25. Housing Prices High for Low Income Workers

http://biz.yahoo.com/ap/050809/affordable_housing.html?.v=2

Dream of Owning a Home Slips Further From Low and Moderate-Income Families


WASHINGTON (AP) -- Housing prices are far outstripping salary increases for low- and moderate-income jobs, putting the American dream of owning a home beyond the reach of teachers, firefighters and other community workers in many cities, said a study being released Tuesday.

The report, by a coalition advocating affordable housing, found that even cities once considered affordable, such as Tulsa, Okla., are rapidly becoming too pricey for lower-income workers such as janitors and retail sales employees.

The study found the median price of a home in the United States rose 20 percent in just 18 months, to $225,000. During the same period, wages for teachers, firefighters and nurses in most cities remained flat or increased slightly, but still fell far short of the annual salary needed to buy a home, the report from the Center for Housing Policy said.

For example, the median household income for a nurse rose 10 percent between 2003 and 2005, to about $36,000. For a firefighter, wages were flat, remaining at about $37,000 a year.

Those salaries don't come close to the $71,000 annual income needed to qualify to purchase a $225,000 home. The number is based on a down payment of 10 percent.

more...

[UpInArms]

26. 9:40 EST Markets Open and Overjoyed at 10th Rate Hike!

Dow 10,599.75 +62.82 (+0.60%)
Nasdaq 2,173.45 +9.06 (+0.42%)
S&P 500 1,229.43 +6.30 (+0.52%)
10-Yr Bond 4.405 -0.14 (-0.32%)

NYSE Volume 93,618,000
Nasdaq Volume 92,113,000

[UpInArms]

29. blather and bye!

NEW YORK (MarketWatch) - U.S. stocks opened higher Tuesday, as investors awaited the afternoon decision on interest rates from the Federal Reserve and monitored oil prices. In premarket electronic action early Tuesday crude futures struck a new high of $64.27. The Dow Jones Industrial Average ($INDU) was up 51.67 points at 10,588, the S&P 500 ($SPX) up 4.73 at 1,227, and the Nasdaq composite ($COMPX) up 8.31 at 2,172.

Well, all you other marketeers and lurkers are going to have to keep the world up to date on the financial machinations for the next week - am away and off.

Take care and keep the wolves at bay!

:hi:

[54anickel]

30. By UIA Guess we'll "see ya" next week?

[UpInArms]

27. Charges bog down May Department Stores earnings

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38573.3918748032-840196440&siteID=mktw&scid=0&doctype=806&

CHICAGO (MarketWatch) -- Loaded with merger and divestiture charges, May Department Stores reported second-quarter earnings that were well below last year's results. For the quarter that ended July 30, May said it made $52 million, or 16 cents a share, compared with $101 million, or 33 cents a share in the year-ago period. The results included charges of $63 million, or 13 cents a share, related to Federated Department Stores (FD) upcoming acquisition of May, as well as costs related to May's purchase last year of Marshall Field's stores. Total sales climbed 16.6% to $3.45 billion while same-store sales declined 1.6%. Federated is expected to close on the May purchase in the third quarter. Shares of May (MAY) ended Monday's session at $40.20.

[UpInArms]

28. Surging home prices outpace worker wages: report

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38573.3883102662-840196291&siteID=mktw&scid=0&doctype=806&

BOSTON (MarketWatch) -- Although average home prices have skyrocketed in many parts of the country, incomes of "key community workers" such as teachers, police officers and janitors in most cities have remained flat, putting a new home out of reach for many, according to a report released Tuesday. "Across the nation we are seeing a growing disparity between the skyrocketing home prices of recent years and the minimal increase, if not flattening, in wages for our nation's community workers," said Barbara Lipman, research director for the Center for Housing Policy. "Additionally, the disturbing trend of retail salespersons and janitors, and those in similar wage groups, paying in excess of what is considered affordable in order to rent a one- or two-bedroom apartment continues in metropolitan areas throughout the country."

[54anickel]

31. 'China to fuel gold to $725'

http://www.financialexpress.com/latest_full_story.php?content_id=98692

snip>

Prices may reach 725 US dollar an ounce by 2010 from the current level of 437 US dollar and China may overtake India as the world's largest consumer of gold jewellery, said analysts.

snip>

Jewellery demand in China, the world's fastest-growing major economy, rose 13 per cent in the first quarter and investment demand increased 36 per cent, according to the World Gold Council, a producer-funded group.

Chinese retail sales of gold jewellery rose more than 11 per cent to 224 tons in 2004, according to GFMS. Sales may increase to as much as 600 tons within five years, according to Merrill Lynch's Birch, leading China to surpass India as the biggest consumer. Indian demand for gold jewellery totaled 517.5 tons last year, GFMS figures show.

Chinese incomes in urban areas rose 9.5 per cent in the first half and are forecast to surge further by the end of the decade.

more...

[Renew Deal]

45. Is this legit.

I see and hear more stuff hyping gold than any other stock or commodity. I don't trust anything I see on gold anymore. There is a commercial running on AAR in NY saying that gold will "double", whatever that really means.

[54anickel]

49. Don't know - the increase in demand is legit enough, but no one can

really speculate on the price.

The report is actually being laughed at in the gold-bug crowd as they always see gold taking off to the moon and when it doesn't they point to a conspiracy. Not that there hasn't been some gov't hanky-panky with gold in the past, but they tend to cry wolf a bit too often The motivation behind the gov't hanky-panky actually goes w-a-a-a-a-y beyond simply wanting to depress the price of gold.

[54anickel]

63. Did the gold price really increase this week?

http://www.kitco.com/weekly/paulvaneeden/aug052005.html

The gold price increased by 1.6%, from $430.10 on Monday to $437.12 on Thursday. At the same time the dollar fell 1.7% against the euro and 1.3% against the yen. If we just use those two currencies as a proxy for the dollar then the average decline was 1.5%. That is not materially different from 1.6% given that we are only looking at two currencies. It therefore seems reasonable to state that the increase in the gold price this week was due to a decrease in the US dollar exchange rate.

While more and more analysts now recognize the US dollar exchange rate causes changes in the US dollar gold price, many still do not understand how and why. I sometimes read that a decline in the US dollar made gold less expensive in other currencies, thereby increasing demand for gold and causing the price to increase. That is hogwash. Take this week as an example.

The gold price is up because the dollar went down. But did the decline in the US dollar cause gold to become less expensive in euros? No. The gold price was 354.79 euros on Monday and 354.42 euros on Thursday. Clearly the gold price in euros did not change in any significant way. The same would be true if we consider the gold price in yen.

When the US dollar declines it does not change the gold price in other currencies and it does not change the demand for gold. It merely means that stuff we buy (or price) on international markets with US dollars become more expensive in US dollars.

I also read this week that the increase in the gold price was due to the looming labor strike in South Africa. A major strike in South Africa could have a short-term (emotional) impact on the gold price, but it did not this week.

more...

[54anickel]

32. U.S. debt explosion!

http://worldnetdaily.com/news/article.asp?ARTICLE_ID=45657

"Are you saying ... that to maintain our lifestyle today, Americans are starting to borrow against their home equity and credit cards?"

– Jan Mickelson, "Mickelson in the Morning," WHO, Aug. 3, 2005

I've never heard it put quite that way, but "yes" I told the astute radio host from Des Moines, Iowa, during a radio interview last week. I went on to make a rare prediction:

Unless Americans make a radical change in our "living-on-borrowed-money" lifestyle (personal and governmental), and oil prices start falling soon, and we begin saving instead of consuming – I expect we'll witness the collapse of the U.S. dollar by 2010.

more...

[54anickel]

33. What Housing Bubble?

http://www.321gold.com/editorials/shedlock/shedlock080905.html

Neil Barsky, managing partner of Alson Capital Partners, LLC, wrote an absurd opinion piece about housing in the Commentary section of the July 28 online issue of The Wall Street Journal in which he claims there is no housing bubble.

Now, plenty of people, some just plain stupid, some with axes to grind, write the same thing. Typically, these opinions are not worth replying to, quite frankly, because they are so widespread and preposterous that one would spend all his time rebutting such nonsense. But Barsky is a special case, for reasons we will address later.

In the meantime, let's review some of the nonsense spewing forth from Mr. Barsky. Here goes:

snip>

...What is relevant is that an original holding of 3,166,680 shares has now been reduced to 1,135,000 shares. This means that Alson Capital Partners, LLC has sold 64.2% of their holding of TOL (2,031,680 shares out of 3,166,680) in the first two quarters of this year.

Since there is a discrepancy in the numbers, it not clear precisely what percentage of TOL that Alson Capital Partners, LLC has been dumping. It does seem to be huge. What is clear is the fact that two sources show Alson Capital Partners, LLC dumping TOL while a managing partner of the corporation went out of his way to defend a housing bubble in a major publication. It is also clear that Mr. Barsky failed to disclose those facts while claiming to be putting his money where his mouth is.

more...

[54anickel]

34. Is the Housing Bubble Popping?

http://www.lewrockwell.com/thornton/thornton27.html

Friday was a bad day for housing stocks and this could be a sign that the housing bubble may have sprung its first leak. This is what the Philadelphia Housing Index looked this week – losing about 5% for the week.



Investors have made around 50% on their money since I first reported on the housing bubble and there could very well be more bubbling to come. Here is a linear graph of high-flying Toll Brothers (TOL), one of the largest homebuilding companies. The stock has increased by over 50% in the last year. Optimists point to the company’s price-to-earnings ratio of "only" 15, which is below the market average.



snip>

The larger problem may be for long-term rates. As Greenspan increases short-term rates the thinking goes that he is reducing inflation expectations and thus reducing the likelihood of increases in long-term rates. However, if long-term rates rise, this is an indication that short-term rates are not rising fast enough to dampen inflationary price pressures. The graph below shows a big increase in the interest rate on 10-year Treasury bonds on Friday that coincided with the fall in homebuilder stocks.

Here is a graph of the interest rate on 10-year Treasure bonds over the last six months. The interest rate made a "double bottom" this summer – below 4% – the lowest rate ever in my lifetime.

more...

[mike923]

36. Could this effect the stock market?

I have a theory that people have not invested as much in the stock market, because they are getting better returns on their money in real estate. If people start pulling money out of that area, where are they going to put it?

The market could go way up if the real estate bubble pops.

[54anickel]

38. I don't know, but I doubt it would drive the market up for a couple of

reasons.

First, some of the people started investing in real estate early on because they got burnt by the dot.com bust. They wanted something real and tangible. Once bitten twice shy; Twice bitten? - I'm thinking Ziplock bags for under the matress might become a good investment. :evilgrin: If interest rates rise enough to get decent returns on "safe" investments, that's probably where that money will head.

People have got to be able to actually pull money out. If they end up with upside down mortgages as prices drop, there's nothing to move anywhere. There has been a "whole lot of equity lendin' goin' on" and bankruptcy will no longer be an option.

Don't foget those 30 year treasuries that will be coming back soon as well. Those will pull a lot of institutional money (ie pensions)out of the markets as they divest into treasuries. The hope is that they will make up for a decrease in demand for our treasuries by foreign central banks - but, who's gonna make up for what they pull out of stocks? The return of the 30 year also points to the gov't wanting to lock in lower rates - so I suspect they see rates rising, perhaps much higher than Greenspin's "measured pace" BS would lead one to believe.

Just my 2 cents worth.

[54anickel]

35. Doomed Empire

http://www.lewrockwell.com/reese/reese213.html

snip>

"Matabeleland (a part of future Rhodesia) is doomed by what seems a law of nature to be ruled by the white man, and the black man must go, or conform to the white man's laws, or die in resisting them. ... The British colonist is but the irresponsible atom employed in carrying out a preordained law – the law which has ruled upon this planet ever since ... organic life was first evolved upon the earth – the inexorable law which Darwin has aptly termed the Survival of the Fittest."

Of course, today there is no Rhodesia, and Zimbabwe is ruled by black people, as is all of sub-Saharan Africa. The British Empire, upon which in the past the sun never set, no longer exists. What happened to the survival of the fittest?

Well, intellectuals, whether British or American, are inevitably out of touch with reality. It didn't seem to occur to them that even a person who couldn't read Latin or solve a simple equation could nevertheless wield a machete and shoot a rifle. An illiterate man can eradicate a lot of intelligence, experience and education with one 10-cent bullet. He can undo the work of years in a second. The Europeans didn't voluntarily abandon their colonies. They were driven out by people they had considered inferior.

The code word we use for superiority these days is "democracy." It is democracy that is superior to all other forms of government, and therefore we are doing people a favor to spread it while, like the British, exploiting their natural resources and cheap labor. We will eventually meet the same fate as the British. The Philippines have already kicked us out. Sooner or later, the Japanese will tell us to get out of Okinawa and other parts of Japan. Even one day the South Koreans and the Germans will say, "Go home."

And we should go home without even being asked. As long as we play the game of empire, we are both bankrupting and corrupting ourselves. No empire in the history of the world has ever lasted beyond a few centuries. While the president plays his futile fiddle tune of spreading democracy, our domestic problems multiply. The debt piles up. The trade deficit piles up. Money, manpower and resources are gobbled up by the world's largest military-industrial bureaucracy. Staggering deficits are growing in terms of future obligations for Social Security and Medicare.

more...

[54anickel]

37. Economists Raise U.S. Growth, Spending Forecasts, Survey Shows

:wtf: are these economist smoking and where can I get some of that? :smoke:

http://www.bloomberg.com/apps/news?pid=10000087&sid=ak3kazPPCqD4&refer=top_world_news

Aug. 9 (Bloomberg) -- Surging automobile sales will contribute to faster U.S. economic growth for the rest of the year, causing interest rates to rise and the jobless rate to fall, according to a Bloomberg News survey of 66 economists.

The world's largest economy will grow at a 4.1 percent annual rate this quarter, the most since the first three months of 2004 and up from the 3.5 percent estimated last month, based on the median forecast in the monthly survey. Growth for October through December is predicted to reach a 3.5 percent pace, up from last month's prediction of 3.4 percent.

The jump in auto-sales triggered in July by discounts at General Motors Corp. and rivals will reverberate as production picks up to rebuild inventories, economists said. The Federal Reserve probably will raise its target interest rate for a 10th straight time later today to keep inflation from flaring as the economy grows and energy prices reach records.

``We are heading toward an even more solid expansion,'' said Gary Schlossberg, a senior economist at Wells Fargo Capital in San Francisco, who raised his third-quarter forecast to 4 percent from 3.5 percent. ``We have consumer spending picking up, and a lot of that is driven by the auto incentives.''

Consumer spending this quarter may grow at a 3.7 percent annual pace, 0.5 percentage point more than forecast last month, and unemployment may drop as spare capacity is absorbed, the survey showed. The jobless rate may end the year at 4.9 percent, the lowest since August 2001 and lowest year-end rate since 2000, instead of the 5.1 percent estimated last month.

more...

Will these folks join the ranks of surprised economists?

http://www.galleryone.com/images/kate2/bullas%20-%20element%20of%20surprise,%20the.jpg

[AnneD]

43. Morning Marketeers

:donut: Oh 54anickle, I thought that the first paragraph would be hard to top :spray: it just gets better and better. I just wonder where these future 'suprised' economists go to school. I graduated magna cum laude from the school of hard knocks-I definantly have a different outlook on things.

[54anickel]

46. Morning AnneD. Yep, that article would be pretty entertaining if it

weren't so sad.

I'm guessing these are the same e-CON-o-mist whose livlihood depends on conning folks into investing in the markets. I'd like to know the names and affiliations of these 66 "gurus".

[54anickel]

39. 11:18 numbers - bonds flatlined

Dow 10,604.05 +67.12 (+0.64%)
Nasdaq 2,175.65 +11.26 (+0.52%)
S&P 500 1,230.58 +7.45 (+0.61%)
10-yr Bond 4.419% 0.00
30-yr Bond 4.6% 0.00
NYSE Volume 640,958,000
Nasdaq Volume 506,803,000

11:00AM : Holding steady near session highs as buyers get some relief amid a pullback in oil prices...
While the commodity's decline has been modest at best, still leaving crude oil futures ($63.43/bbl -$0.51) hovering near record levels, the fact that some consolidation has snapped a four-day winning streak that lifted oil prices 5.8% to historic highs has helped investors take some money out of Energy, which has soared nearly 29% so far this year, and look for bargains in more influential sectors like Financial, Technology, Industrials and Consumer Discretionary - all of which have underperformed in 2005...NYSE Adv/Dec 1867/1079, Nasdaq Adv/Dec 1633/1084

10:30AM : Major indices continue to hold their own but are showing little reaction to the latest economic report... At the top of the hour, June wholesale inventories rose 0.7% (consensus +0.4%), led by a 3.1% increase in auto inventories... While the inventory data don't usually garner much attention, they have gained some substance of late after inventory reductions shaved 2.3% off the advance read on Q2 GDP a week and a half ago... It is worth noting that strong inventory trends could lead to real GDP growth of 5% or more in for Q3...

However, since the data say little about personal consumption and with the FOMC meeting forthcoming, the overall report has gone relatively unnoticed by both stock and bond investors... NYSE Adv/Dec 1810/1026, Nasdaq Adv/Dec 1546/1063

10:00AM : Equities still on the offensive as virtually every sector trades in positive territory... Pacing the way higher has been the Utilities sector, getting a boost from falling bond yields, better than expected Q2 earnings from Edison International (EIX 41.13 +0.96) and an analyst upgrade on PG&E Corp (PCG 36.17 +0.43)... Another interest-rate sensitive sector attracting buyers has been Financial, led by solid follow-through buying in brokerage and a rebound in REITs...

Technology has been strong across the board amid optimism that Cisco Systems (CSCO 19.47 +0.22), which reports after the bell, had a strong Q4, while a Lehman Brothers upgrade on Advanced Micro Devices (AMD 20.64 +0.68) has helped chip stocks... Industrials has also traded higher, as strength in transportation and aerospace has offset a disappointing Q2 report from Fluor Corp (FLR 60.29 -3.51), while Consumer Discretionary has benefited from a 1.1% surge in Disney (DIS 25.68 +0.27) ahead of its Q2 earnings and an upgrade on Gap Stores (GPS 21.80 +0.45)... DJTA +0.6, DJUA +0.6, DOT +0.4, Nasdaq 100 +0.6, Russell 2000 +0.4, SOX +1.0, S&P Midcap 400 +0.4, XOI +0.5, NYSE Adv/Dec 1766/689, Nasdaq Adv/Dec 1561/842

[54anickel]

40. Wal-Mart Faces Tough Questioning by Judges

http://www.latimes.com/business/la-fi-walmart9aug09,1,5549898.story?coll=la-headlines-business

SAN FRANCISCO — Wal-Mart Stores Inc. ran into hostile questioning Monday from judges deciding whether the nation's biggest employer must face the country's biggest lawsuit claiming men were favored over women on the job.

Two of three judges on a federal appeals panel grilled the retail behemoth's attorney, bringing up facts harmful to the company's defense and faulting him for using "arrogant" language in criticizing the trial court judge.

snip>

Employer defense lawyers and trade associations say that if the case proceeds as a class action, Wal-Mart may be forced to settle rather than risk paying out billions of dollars in back pay and punitive damages. They say that will encourage more sweeping suits to be brought against big companies.

Only Judge Andrew Kleinfeld, the sole Republican appointee on the panel, directed many pointed questions at Brad Seligman, the Oakland lawyer representing at least six women and potentially every woman who worked at Wal-Mart or Sam's Club stores since 1998.

Damned "librul" activist judges! This "sole Repuke" is the only one doin' his job! :sarcasm:

more...

[54anickel]

41. U.S. Wholesale Inventories Rose 0.7% in June; Sales Rise 0.6%

http://www.bloomberg.com/apps/news?pid=10000103&sid=aHpjReHeYzQY&refer=us

Aug. 9 (Bloomberg) -- Stockpiles at U.S. wholesalers rose more than expected in June, a sign that companies are rebuilding inventories as the economy picks up speed.

The 0.7 percent increase brought the total value of inventories to $353.1 billion and followed a revised 0.3 percent gain in May, the Commerce Department said today in Washington. Sales rose 0.6 percent to $297.3 billion in June, up from $295.6 billion the month before.

Companies finished paring bloated stockpiles in the second quarter, a process that slowed economic growth because businesses didn't have to order as many goods. Economists surveyed by Bloomberg News are raising their third-quarter economic growth forecasts as companies restore inventories and consumers and businesses increase spending.

``We are in the midst of an inventory resurgence from a shortfall that occurred in the March to May period,'' Michael Englund, chief economist at Action Economics LLC in Boulder, Colorado, said before the report.

more....

[54anickel]

42. But is the glass half full or half empty?

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2005-08-09T140142Z_01_N09188514_RTRIDST_0_ECONOMY-INVENTORIES-URGENT.XML

snip>

The Commerce Department said stocks of durable goods -- products meant to last three years or more -- rose 0.9 percent in June. Automotive inventories rose 3.1 percent in June, marking their biggest increase since December 2003. Wholesale auto sales also were strong, gaining 1.2 percent in June amid heavy retail discounting by automakers.

Nondurable inventories rose 0.3 percent, with sales up 0.8 percent.

Rising inventories can signal either growing business confidence about future demand or an unexpected sales drop that causes unsold stocks to pile up.

The inventories-to-sales ratio, a measure of how long it would take to deplete stocks at the current sales pace, was flat in June at 1.19 months' worth.

[54anickel]

44. More details

http://futures.fxstreet.com/Futures/news/afx/singleNew.asp?menu=latestnews&pv_noticia=1123596967-e04f0f08-31503

snip>

In the first estimate of second-quarter gross domestic product, slower growth in inventory building had subtracted 2.4 percentage points from growth, but the June data released Tuesday point to an upward revision in GDP from the 3.4% originally reported

Sales of durable goods increased 0.3% in June, held back by tepid sales of metals, computers and electrical equipment. Sales of autos, furniture and machinery were robust

Inventories of durable goods rose 0.9%, including the 3.1% gain in autos, the largest since December 2003. Stockpiles of machinery increased 1.5% while computer inventories increased 1.4%. Inventories of metals, lumber and furniture declined

The inventory-to-sales ratio for durable goods rose to 1.50 from 1.49

Sales of nondurable goods increased 0.8% on the 3.5% rise in petroleum sales, which was likely the result of higher prices. Drug sales increased 2.1%

Inventories of nondurable goods increased 0.3%, with declines in drugs and groceries offsetting a large increase in petroleum

The inventory-to-sale ratio for nondurable goods remained at 0.88. The inventory-to-sales ratio for drugs fell to a record low 1.01. The ratio for petroleum remained at 0.30

more...

[54anickel]

47. 12:37 - leveling off over the lunch-hour

Dow 10,611.85 +74.92 (+0.71%)
Nasdaq 2,176.19 +11.80 (+0.55%)
S&P 500 1,231.03 +7.90 (+0.65%)
10-yr Bond 4.43% +0.01
30-yr Bond 4.608% +0.01
NYSE Volume 920,547,000
Nasdaq Volume 718,972,000

12:00PM : Market holding onto respectable gains across the board as investors embrace tame inflation data and get some reprieve from consolidation in crude prices ahead of this afternoon's FOMC meeting... At 2:15 ET, the Fed is widely expected to raise rates again by a 1/4% (to 3.5%) - the tenth consecutive such increase...
However, the belief that accompanying Fed language will keep a "measured" pace of tightening and the fact that economic growth has not slowed at all in response to nine previous rate hikes, has provided investors with some breathing room to look for bargains following three consecutive market declines... Providing additional support behind broad-based buying efforts that has left all 10 economic sectors in positive territory has been a pullback in crude oil futures ($63.70/bbl -$0.24), after a four-day surge (+5.8%) sent oil to historic highs, and a favorable read on inflation...

Earlier, as investors dug deeper into a preliminary read on Q2 productivity, which grew 2.2% (consensus +2.0%) - the slowest pace in nine months, the observation that unit labor costs - a key inflation gauge - rose just 1.3%, versus an expected 2.9% rise and a 3.6% increase in Q1, also helped improve sentiment, especially since the Fed is very likely to specify further rate hikes to stave off rising price pressures... Even though an early recovery effort in bonds has reversed course, as the benchmark 10-year note is now down 1 tick to yield 4.42%, the Utilities sector has turned in the morning's best performance, getting a boost from Edison International's (EIX 40.47 +0.30) strong Q2 report and an analyst upgrade on PG&E Corp (PCG 36.08 +0.34)...

Financial - a much more influential interest-rate sensitive sector - has also traded higher, benefiting from strong follow-through buying in brokerage and a rebound in REITs... Technology has also been strong across the board, led by a 1.2% rebound in semiconductor following a Lehman Brothers upgrade on Advanced Micro Devices (AMD 20.62 +0.66) and upbeat comments out of Texas Instruments (TXN 32.47 +0.94) at the Pacific Crest Tech Forum... Growing optimism that Cisco Systems (CSCO 19.62 +0.37), which reports after the bell, had a strong Q4 has also provided support...

Consumer Discretionary has also posted a solid gain taking advantage of strength in Disney (DIS 25.92 +0.51), following several upbeat analyst comments ahead of its Q2 earnings report, and Gap Stores (GPS 21.80 +0.45), which was upgraded to Buy from Hold at A.G. Edwards... Health Care has also been an influential leader to the upside, as the potential return of Tysabri to the market has lit a fire under shares of Biogen Idec (BIIB 42.06 +3.64)... Industrials has also traded higher, as gains in transportation and aerospace offset a disappointing Q2 report from Fluor Corp (FLR 59.92 -3.88) while Materials has also shown relative strength, as continued momentum in aluminum offsets modest weakness in gold and diversified metals...

Despite falling oil prices and a disappointing Q2 report from El Paso Corp (EP 11.61 -0.40), even Energy has shown relative strength... Separately, June wholesale inventories rose 0.7% (consensus +0.4%), but since the data say nothing about consumer spending, the report has been largely ignored by investors in favor of today's FOMC policy statement...DJTA +0.4, DJUA +1.3, DOT +0.6, Nasdaq 100 +0.7, Russell 2000 +0.5, SOX +1.2, S&P Midcap 400 +0.4, XOI +0.5, NYSE Adv/Dec 1950/1132, Nasdaq Adv/Dec 1704/1141

11:30AM : Indices continue to put together a solid advance as buyers remain in control of the early action... Aside from an overall improvement to underlying sentiment, following the first down week in over a month for the broader market, the U.S. markets may also be taking notice of widespread strength in European markets... Since the last update, the Dax Index finished up 1.3% - its best one-day advance since June 1 - while the CAC 40 Index closed up 1.1%, just 19 points shy of a new three-year high...NYSE Adv/Dec 1920/1084, Nasdaq Adv/Dec 1683/1107

11:00AM : Holding steady near session highs as buyers get some relief amid a pullback in oil prices...

While the commodity's decline has been modest at best, still leaving crude oil futures ($63.43/bbl -$0.51) hovering near record levels, the fact that some consolidation has snapped a four-day winning streak that lifted oil prices 5.8% to historic highs has helped investors take some money out of Energy, which has soared nearly 29% so far this year, and look for bargains in more influential sectors like Financial, Technology, Industrials and Consumer Discretionary - all of which have underperformed in 2005...NYSE Adv/Dec 1867/1079, Nasdaq Adv/Dec 1633/1084

[54anickel]

48. Saudis to retrieve $360 billion abroad

http://www.sciencedaily.com/upi/?feed=TopNews&article=UPI-1-20050807-09573600-bc-saudi-funds.xml

RIYADH, Saudi Arabia, Aug. 7 (UPI) -- Saudi Arabia said Sunday it was working to bring back to the kingdom a total of $360 billion invested abroad in the last 18 months.

Foreign Minister Prince Saud al-Faisal told reporters the government was working on returning these "national assets" back to the oil-rich Arab country and to attract foreign investments in Saudi Arabia.

He said the kingdom has "established qualified institutions for that purpose," but did not elaborate.

The minister added that the "smooth way" in which power was handed over to new King Abdullah bin Abdul Aziz after King Fahd's death last week meant a continuation of stability.

Hmmm, getting ready to invest in the Iranian oil bourse? Or just an attempt to calm jittery markets?:shrug:

[belab13]

53. Dollar Dump... and prepping for significant stock market declines

They're selling Treasuries and stock investments IMO.

what else could it be?

Keep in mind the Saudis have the inside scoop on the oil picture and methinks they are maxed out in terms of production.

[54anickel]

56. Reasons to be optimistic about the GCC real economy

Looks like there maybe some bargains coming up in the Gulf capital markets. :shrug:

http://www.ameinfo.com/65373.html

snip>

Saudi Arabia will boast a budget surplus of more than $50 billion this year, according to Samba Group, whose economists always err on the cautious side. The UAE will have perhaps $15 billion or more in unplanned income from oil, ditto Kuwait, ditto Qatar, and even Oman and Bahrain will enjoy higher than expected energy related income.

snip>

Standby for a catch-up in the rest of the Gulf States as oil revenues surge beyond the amounts required to pay off old debts. State-run institutions have also been cautious so far, fearing that oil prices might suddenly dive as in late 1998.

But that is changing. Abu Dhabi is the first to join the spending party, but Saudi Arabia is about to let rip. It is well known that the Kingdom is serious about internal reforms, and the best way to make such reform universally popular is to make them at a time of great prosperity.

Thus for Saudi Arabia a renewed burst of oil riches has come just at the right time to enable the Kingdom to manage a peaceful transformation to a more modern nation, albeit one with a distinctly Saudi identity. Maintaining your own identity is one advantage of being extremely rich.

snip>

Not since the 1970s have the Gulf States had it so good, and investment at home and not abroad is the mantra for the 2000s. Thus the real economy is going to undergo a huge wave of investment in all manner of infrastructure and projects, and probably attract foreign direct investment as well, which will be welcome this time rather than shunned as in the past.

more...

[54anickel]

50. Moody's warns of risk in CMBS

http://news.yahoo.com/s/ft/20050808/bs_ft/fto080820051654205697;_ylt=Ank6RRep1q6zjDHy1V8jajD2ULEF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl

Investors in structured products backed by commercial property debt may be at risk from the "frothy" lending climate, according to a recent report by Moody's Investors Service, the credit rating agency.

Some investors in commercial mortgage backed securities, or CMBS, are relying partly on the strong track record of the asset class - a record established during a period of rising property prices and falling interest rates, according to Tad Philipp, one of the authors of the report.

By Moody's analysis, the typical loan destined for inclusion in CMBS instruments now exceeds the sustainable value of the property on which it is secured - although the market value might be higher.

"Loans are originated to sell rather than hold," said Moody's. The institutions that make such loans often repackage them into CMBS, which are sold to capital market investors.

The US market for CMBS was $72bn in the first half of this year, 65 per cent up on the same period last year, according to the agency.

more...

[54anickel]

51. Hedge Funds Get Trounced

http://www.forbes.com/home/services/2005/08/09/hedge-funds-july-cx_lm_0809hedge.html

NEW YORK - So how much would you, as a rich investor, pay to get beaten by every major stock index?

Hedge funds, those expensive investment toys of the rich and famous, who have high expectations for how much they ought to earn for taking bigger risks, posted their best monthly performance of the year in July. But that wasn't enough to beat the performance of any of the three major stock indexes.

For July, the average hedge fund edged up 2.35% over June. But put that up against the Standard & Poor's 500, which is up 3.72%, the Dow Jones Industrial Average, which is up 3.56%, and the Nasdaq, which is up a whopping 6.22% for the month.

Hedge fund consultants, who are inclined to put a positive spin on just about anything, say the showing reflects the strong stock markets during the month. The goal of most hedge funds these days is seemingly to make sure that rich investors simply don't lose very much of their pile, even if they don't make as much as they might have had they put their money, say, in a Vanguard Index Fund.

Hedge funds are supposed to be big risk takers--taking actions like options trading and short-selling that regular mutual funds for smaller investors were never allowed to do. Now, however, the proliferation of hedge funds, with so many managers chasing the same strategies, has eaten sharply into the kinds of profits that once were quite routine.

more...

[54anickel]

52. Despite Illegal Status, Buyers Get Home Loans

http://www.latimes.com/business/la-me-house9aug09,1,6173060.story?coll=la-headlines-business

snip>

"Do you want a house, work and pay taxes but don't have a Social Security number?" reads his flier, written in Spanish and tailored to his potential customers. "We can help you LEGALLY!"

Across the country, particularly in Texas and parts of the Midwest, hundreds of illegal immigrants have bought homes using special lending programs that bypass the need for a Social Security number. Now, with backing from some of the country's largest financial institutions, this newest effort to tap customers for the real estate market is moving to the nation's largest concentration of illegal immigrants — California.

As buyers begin to queue up, real estate is becoming the latest arena to highlight the often-bizarre contradictions of American immigration policy.

snip>

But for years, because qualifying for a mortgage required a Social Security number, the only way for an illegal immigrant to do so was by using a false number. In addition, such immigrants often were rejected or overlooked by legitimate lenders, leaving them vulnerable to fraud.

Lenders have a powerful incentive to find ways to get around those barriers: tens of thousands of potential customers. The National Assn. of Hispanic Real Estate Professionals estimates that more than 216,000 undocumented immigrants, including many who have been in the country for decades, could buy homes if they had better access to the market.

more...

:wow: And here I can't even get anyone to look at my job application or get utility service unless I give them my SS #.

[54anickel]

54. Clear Channel profit off, backs off special payout

http://today.reuters.com/news/newsArticle.aspx?type=industryNews&storyID=2005-08-09T165241Z_01_N09387941_RTRIDST_0_INDUSTRY-INDUSTRY-CLEARCHANNEL-DC.XML

LOS ANGELES (Reuters) - Clear Channel Communications Inc., the largest U.S. radio station chain, on Tuesday posted slightly lower earnings and revised plans for a special dividend related to a restructuring involving an IPO of part of its outdoor business and spin-off of its entertainment unit.
The company said it still intends to return $1.6 billion to shareholders.

However, unlike its previous plan to pay a $3 per share special dividend following the close of the IPO of part its outdoor division, the payout may come in the form of share buybacks, a special dividend, or a combination of the two.

In a release, Clear Channel said it expects the spinoff to be completed by the end of this year.

Clear Channel reported second-quarter earnings fell to $220.7 million, or 40 cents a share, from $253.8 million, or 41 cents a share, a year earlier.

more...

[54anickel]

55. Investing in Iraq's Foreign Currency Can Increase Your Future Prosperity

:wtf:

http://www.emediawire.com/releases/2005/8/emw268006.htm

snip>

How does buying the Iraqi Dinar help your future prosperity? The Dinar has long been a strong currency. Right now it is at a historically low rate. It is similiar to what happened in Japan and Germany after World War II. Their economies were shattered so you could buy up lots of their currency very cheaply. Once their economies got back on track, anyone who had taken advantage of that opportunity became extremely wealthy. The US Government has invested over 200 Billion Dollars in the future of Iraq so far. They have commited another 18 Billion Dollars in Reconstruction Aid. That is more than $2000 per US Household. Are you in a position to directly profit from that investment? You are if you buy New Iraqi Dinars.

“Before Saddam came to power the Dinar was worth $3.30 PER DINAR. That is a typical value for some oil producing countries in that region. For example, Kuwait's currenciy is valued between $3 - $4 a piece now. Then Saddam came to power, lost 2 wars (Iran & Kuwait) and years of UN Sanctions drove the Dinar down to it's lowest exchange rate ever. Right before Operation Freedom began, the Dinar was worth about $0.30 PER DINAR,” says Matthew Yonan, founder of Why Buy Dinar (why-buy-dinar.com), a federally registered foreign currency dealer. “Right now you can buy 1 Million Dinars for less than $1000.00 US. That is less than $.001 PER DINAR! Speculators have been buying the New Iraqi Dinar up in the Billions. Even if the Dinar only returns to be worth $0.01 PER DINAR, that 1 Million Dinar would be worth $10,000.00 US.”

There is no international exchange rate set for the New Iraqi Dinar yet, that is why you cannot go to a bank right now and get it. It is also what makes this opportunity possible. Once the international exchange rate is set, you will be able to bring the Dinar to many international banks and money brokers in the US and abroad to exchange it for any currency you like. The only way you can get their new currency now is to be in Iraq or buy it from a registered money broker. Why Buy Dinar brings it in legally through connections with money brokers they have there. :eyes:

“Eventually the holders of New Iraqi Dinar will benefit as Iraq improves its oil production and economy. Those who position themselves by buying the Dinar today will profit at that time,” Yonan says.

All the New Iraqi Dinar sold by Why Buy Dinar is Certified Authentic Dinar. They offer a triple your money back guarantee if any of the Dinar they sell you is not authentic.

more...

Heh, just googled iraqi dinar - there are tons of websites selling them. You too could become a currency speculator :eyes:


On edit - wonder if it looks like this:

[54anickel]

57. 2:35 Whoa babycakes DOW up nearly 100

Dow 10,634.38 +97.45 (+0.92%)
Nasdaq 2,180.70 +16.31 (+0.75%)
S&P 500 1,233.62 +10.49 (+0.86%)
10-yr Bond 4.432% +0.01
30-yr Bond 4.615% +0.02
NYSE Volume 1,316,875,000
Nasdaq Volume 1,029,406,000

2:30PM : Market gets a modest boost, extending gains amid a modest turnaround in the Treasury market... While the policy statement was basically left unchanged, further validation of contained inflation has helped send benchmark yields on the 10-year note (+3/32) back to 4.40%...

The actual text of the statement reads: "The Committee believes that, even after this action, the stance of monetary policy remains accommodative and, coupled with robust underlying growth in productivity, is providing ongoing support to economic activity. Aggregate spending, despite high energy prices, appears to have strengthened since late winter, and labor market conditions continue to improve gradually. Core inflation has been relatively low in recent months and longer-term inflation expectations remain well contained, but pressures on inflation have stayed elevated. The Committee perceives that, with appropriate monetary policy action, the upside and downside risks to the attainment of both sustainable growth and price stability should be kept roughly equal. With underlying inflation expected to be contained, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured. Nonetheless, the Committee will respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability."NYSE Adv/Dec 1811/1407, Nasdaq Adv/Dec 1656/1324

2:15PM : As expected, the FOMC has raised the fed funds rate by 25 basis points to 3.5% and maintains balanced risk assessment, with declaration that it believes policy accommodation can be removed at a pace that is likely to be measured...NYSE Adv/Dec 1808/1397, Nasdaq Adv/Dec 1659/1309

2:00PM : Range-bound trading persists, as stocks continue to trade sideways ahead of the Fed's upcoming decision regarding monetary policy... The FOMC's policy statement, which will be released in roughly 15 minutes, really remains the only unknown with regards to the Fed's action today, as a 25 basis point hike in the fed funds rate to 3.5% is widely anticipated...

Given the Fed's stated tone and the decidedly stronger economic data over the last few weeks we at Briefing.com expect a policy directive nearly identical to June's, which simply perpetuates the outlook for continued tightening to higher policy rates... NYSE Adv/Dec 1788/1406, Nasdaq Adv/Dec 1635/1315

1:30PM : Indices are off their best levels but still hold on to the bulk of today's gains, as oil prices slip to session lows... While further deterioration in crude oil futures ($63.35/bbl -$0.59) is normally a positive for equities, a reversal in Energy, which has been a pocket of strength based on expected Q2 earnings growth for the S&P of 41% (the highest growth rate of at 41%), has taken a bit of steam out today's upside momentum, but hardly enough to make a significant change in the standings... NYSE Adv/Dec 1825/1355, Nasdaq Adv/Dec 1602/1325

1:00PM : Stocks have been kept on a tight leash over the last two hours as the market continues to run in place ahead of the FOMC meeting... Bonds, however, have recently slipped below the flat line in quiet trade, as benchmark yields on the 10-year note (-2/32) hover around 4.42%... However, lighter than usual volume in the Treasury market has provided little conviction behind the modest pullback, as interest-rate sensitive areas like Financial, Utilities and Homebuilding have barely batted an eye... NYSE Adv/Dec 1874/1271, Nasdaq Adv/Dec 1681/1235

[DoBotherMe]

59. Lipstick on a pig?

http://64.233.167.104/search?q=cache:bNkIy9BJnzUJ:www.321gold.com/editorials/daughty/daughty081104.html+lipstick+on+a+pig+stock+market&hl=en

[54anickel]

61. Ewww, a Mogambo classic. Thanks DanaM!!! Seems nothing's changed

[54anickel]

60. Crawford meeting designed to highlight good economy

http://www.marketwatch.com/news/story.asp?guid=%7B6DD59299-2CE2-48F2-9ECD-1318B8D14879%7D&siteid=google

WASHINGTON (MarketWatch) -- Against a backdrop of falling public approval ratings, President Bush on Tuesday lauded strengthening economic data and credited his policies with setting the stage for continued economic growth.

"The economy of the United States is strong and the foundation for sustained growth is in place," Bush told reporters ahead of a meeting with his top economic advisers at his Crawford, Texas, ranch.

Bush repeated his calls for Congress to permanently extend his first-term tax cuts, create private Social Security accounts, and pass legislation to limit medical-malpractice lawsuits.

snip>

"In terms of whether interest rates will -- the effect interest rates will have on our economy, I think we're more concerned about energy prices and health-care prices," Bush said.

Asked about the potential impact of rising interest rates, Bush said he trusts the judgment of Fed Chairman Alan Greenspan on monetary policy.

"He makes decisions based upon facts, not based upon politics. And I think it's important for the American people to understand that," Bush said. :rofl:

more...

[54anickel]

66. Bush cites upbeat economic data to promote domestic agenda

http://www.nctimes.com/articles/2005/08/09/news/nation/890510425.txt

CRAWFORD, Texas (AP) -- President Bush cited recent positive economic reports on Tuesday to promote his domestic agenda, including his embattled plan to restructure Social Security.

"The economy of the United States is strong and the foundation for sustained growth is in place," Bush declared, flanked by members of his domestic policy team after a strategy session on his Texas ranch.

Bush cited last Friday's report that the economy created 207,000 jobs in July -- the best showing in three months. That followed reports that the economy expanded at a solid 3.4 percent rate in the April-June quarter.

In contrast to Bush's upbeat assessment, public opinion of his handling of the economy is not as positive. An Associated Press-Ipsos poll conducted earlier this month showed his economic approval rating at 41 percent -- his lowest rating yet on that poll.

Not all the economic news has been good. Real wages have been stagnant. Economists suggest most of the recent economic gains have gone to higher-income and higher net-worth households. And while job growth has improved recently, the level of U.S. jobs is still not back to the levels before the 2001 recession.

[54anickel]

62. 3:15 - flirted with resistance and got the cold shoulder

Dow 10,595.36 +58.43 (+0.55%)
Nasdaq 2,171.29 +6.90 (+0.32%)
S&P 500 1,229.24 +6.11 (+0.50%)
10-yr Bond 43.96 -0.23 (-0.52%)
30-yr Bond 45.79 -0.17 (-0.37%)
NYSE Volume 1,519,471,000
Nasdaq Volume 1,192,836,000


3:00PM : More of the same for the major indices as market internals still suggest a positive tone to trading... Advancers on the NYSE outpace decliners by an 19 to 12 margin while advancing issues on the Nasdaq hold a 17 to 12 advantage over declining issues... A more than 2-to-1 ratio of up to down volume, however, reflects an even more bullish bias at both the Big Board and the Composite...
Meanwhile, all three of the major averages continue to trade well above initial support levels but modest buying interest amid lighter than usual volume has not been enough to push the S&P and Nasdaq through resistance levels of 1233 and 2185, respectively... NYSE Adv/Dec 1989/1292, Nasdaq Adv/Dec 1747/1263

[54anickel]

64. Follow the Money - The Fed's Open Market Operations

http://www.gold-eagle.com/editorials_05/yu080805.html

After a furry of bills enacted passing along hundreds of billions of dollars to the energy, construction, and transportation sectors - including a $231 million bridge for Representative Don Young (R-AK) to be named after himself - and leaving the tab for our children and grandchildren, the legislature had finally gone home for their August holiday. And, just when we thought we could all feel a little safer, the market seemed to be treading dangerous water again.

There's no better way to follow the market than to follow the money, and there's no better way to follow the money than to follow the Fed's daily Temporary Open Market Operations. Open Market Operations are the most powerful and flexible tool of the Fed's monetary policy, yet it's probably one of the least understood and discussed topics. Basically, the Federal Reserve, which is NOT a branch of the government, buys and sells government securities in the secondary market to add or drain reserves from the banking system.

There are two different approaches in the Open Market Operations - Temporary and Permanent. When the shortage or excess of reserves are expected to persist for a long period, the Fed makes outright purchases or sales of securities that permanently affect the Fed's portfolio and the supply of reserves. This Permanent Open Market Operations only occur a few times each year. Temporary Open Market Operations, on the other hand, occur daily as the Fed implements monetary policy by using short-term repurchase agreement (Repo) to add and reverse repurchase agreement to drain reserves.

One observation that should make anyone question the integrity of this private banking cartel called the Federal Reserve is the fact that there has been NO Reverse Repo, or the "draining" of reserves in the banking system. Although I've only started tracking this little known data since 2004, the duration of this data set should be sufficient to call the Fed's intent to fight the inflation a bluff - to put it mildly.

more...

[54anickel]

65. Indian gold market / U.S. treasuries

http://www.321gold.com/editorials/phillips/phillips080805.html

snip>

The globe depends less on the U.S.A.
We don't have to wait for China to take top place in the globe's economic ladder the mere fact that it is a rising global economic driver is changing the global economic structure. The world if fully aware that the Far East is developing as a bloc with China at the centre, despite Japan being the second largest economy in the world. The Eurozone has developed its own degree of self-sufficiency that makes it far less dependent on the States for its exports. The spread of global influence to these additional economic blocs has reduced the influence of the States over the global economy. The transition is slow but steady and will lead eventually to the States standing alongside, if not one step behind the States in global economic influence. The role of its currency has to reflect this change. So rather than looking at the State of an economy for its influence over its currency, one has to look at its Balance of Payments. A nation that through 'floating' its currency down in the case of a deficit, in the hope of balancing its international books is fooling itself as well as all others. The very piece of history we are seeing of the $ weakening over the long term will have to reflect this only in part, because its creditors need to help the $ to retain its value by re-investing those $s back in U.S. investments, thus negating this effect.

A far greater influence we will see from now on is the growing disenchantment of the creditors of the U.S. with the $ as a means of holding surpluses. In direct trade with the U.S. this is unrealistic of course, but in their dealings with other countries, the choice of currency can be changed, as we believe is the case with China and its selection of a 'basket of currencies' for its exchange value. The announcement of Russia that it will drop its target level of the $ in its reserves from 65% to 60% is a continuation of a process announced earlier this year by the likes of Korea. The fact that the States is not behaving as a Debtor should, is already making the present level of U.S. interest rates suspect as a means of valuing the $. How high would you accept as a reliable interest rate level from a Debtor with a poor repayment level before you called in the debt?

The use of the $ as a global reserve currency is falling and may well prove to be a heavy source of inflation inside the States in the future! For this reason the Fed will likely keep increasing interest rates.

snip>

You will note in the Table above the emboldened items, showing surprisingly Japanese holdings of U.S. Treasuries dropping between December 2004 and May 2005, as was the case with, again surprisingly the U.K. and as announced Korea. What is significant is the increase in the holding of these Treasuries by the Caribbean Centers who not far off doubled their holdings. We have believed that these are funds holdings, as they have proved a profitable investment, but could it be also a way of mopping up international liquidity, by those with distinctly nationalistic intentions? Certainly this picture shows a move away by foreign nations from U.S. Treasuries.

more...

[54anickel]

67. Closin' time - everybody goes home a winner

Dow 10,615.67 +78.74 (+0.75%)
Nasdaq 2,174.19 +9.80 (+0.45%)
S&P 500 1,231.38 +8.25 (+0.67%)
10-yr Bond 4.394% -0.03
30-yr Bond 4.574% -0.02
NYSE Volume 1,897,395,000
Nasdaq Volume 1,488,231,000

Stocks finished higher across the board, as tame inflation data and falling oil prices helped investors deal with another Fed hike... As expected, the Federal Reserve raised the fed funds rate by 25 basis points for the tenth consecutive time to 3.5%, maintaining their "measured" language and accommodative policy stance... However, further confirmation that "aggregate spending, despite high energy prices, appears to have strengthened" and that core inflation remains "relatively low," helped strengthen early optimism spurred by better than expected economic data...
Before the bell, investors got a preliminary read on Q2 productivity, which grew at a seasonally adjusted rate of 2.2% (consensus +2.0%), while a modest 1.3% increase in unit labor costs, versus an expected 2.9% rise and a 3.6% increase in Q1, suggested that inflation remains well contained... Offering investors some additional reprieve following three consecutive market declines was a pullback in oil prices ($63.07/bbl -$0.87), as traders consolidated gains which had lifted the commodity nearly 6.0% over the last four sessions to historic highs...

Providing the bulk of leadership, which helped all ten economic sectors close higher, was Health Care... Biogen Idec (BIIB 41.24 +2.82) rallied around a safety review that showed no new confirmed cases of the fatal brain disease behind Tysabri's late-February withdrawal while a rebound in the drug group, following a three-day correction, helped Schering-Plough (SGP 21.68 +0.54) break out to a new two-year high...

Another sector surging more than 1.0% was Consumer Discretionary, benefiting from a 2.9% surge in Disney (DIS 26.14 +0.73), following several upbeat analyst comments ahead of its Q2 report, and an A.G. Edwards upgrade on Gap Stores (GPS 21.50 +0.15) to Buy from Hold, which helped Retail (+0.9%) close higher for the first time in nearly a week... A rebound in Homebuilding, which had consolidated over the last five sessions, also provided a boost as benchmark yields on the 10-year note (+5/32) closed near session lows... Treasurys closed higher after the Fed's policy directive offered no major changes and did not fan concerns about inflation... Two other interest-rate sensitive areas closing higher included Financial and Utilities...

The latter benefited from an analyst upgrade on PG&E Corp (PCG 36.20 +0.46) while the former got a lift from a recovery in REITs and solid follow-through buying in brokerage... Technology was another influential leader to the upside, fueled by growing optimism that Cisco Systems (CSCO 19.61 +0.36), would deliver a solid fiscal Q4 (Jul) report and offer reassuring guidance after the bell...

Renewed buying interest in chip stocks, after Lehman Brothers upgraded Advanced Micro Devices (AMD 20.42 +0.46) to Overweight from Equal-Weight, citing a seasonally stronger 2H05, and following upbeat comments out of Texas Instruments (TXN 32.51 +0.98) at a Pacific Crest tech conference, also provided support... The Industrials sector also posted a noticeable gain, as strength in railroad and aerospace offset weakness in airline and a disappointing Q2 report from Fluor Corp (FLR 59.80 -4.00)... Even Energy, in spite of a 1.4% decline in oil prices ahead of tomorrow's weekly inventories report and a disappointing Q2 report from El Paso Corp (EP 11.83 -0.18), eked out a slim gain...

Separately, June wholesale inventories rose 0.7% (consensus +0.4%), led by a 3.1% increase in auto inventories; however, since the data provide little about personal consumption, the report was largely ignored as investors geared up for Fed's policy directive...DJTA +0.3, DJUA +1.1, DOT +0.5, Nasdaq 100 +0.7, Russell 2000 +0.2, SOX +1.2, S&P Midcap 400 +0.4, XOI +0.2, NYSE Adv/Dec 1891/1383, Nasdaq Adv/Dec 1596/1446

3:30PM : Major averages are well off their highs but still appear poised to close higher, as buyers remain an active bunch ahead of Cisco's report after the bell... While Cisco Systems (CSCO 19.60 +0.35) - the third most actively traded issue on the Nasdaq - typically reports earnings that are in-line to a penny ahead of consensus estimates, it appears investors are anticipating a larger (perhaps $0.02 or more) Q4 EPS surprise, given the number of positive earnings reports from related companies...

Meanwhile 28 out of 30 Dow components - including American International Group (AIG 61.20 +0.20) and Walt Disney (DIS 26.20 +0.79), which also report after the close - had traded in positive territory, but renewed selling pressure has recently inched six more fellow blue chips (i.e.AXP, HPQ, IBM, JPM, MO and SBC) into negative territory... NYSE Adv/Dec 1882/1361, Nasdaq Adv/Dec 1553/1462



Have a great evening :hi: