STOCK MARKET WATCH, Thursday 1 September

[ozymandius]

Thursday September 1, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 142 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 255 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 319 DAYS
DAYS SINCE ENRON COLLAPSE = 1376
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 31, 2005

Dow... 10,481.60 +68.78 (+0.66%)
Nasdaq... 2,152.09 +22.33 (+1.05%)
S&P 500... 1,220.33 +11.92 (+0.99%)
10-Yr Bond... 4.02% -0.07 (-1.71%)
Gold future... 438.10 +2.60 (+0.59%)

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 Mike Hartman

DAMAGE CONTROL ON ALL FRONTS

The tragedies of Hurricane Katrina are now starting to be seen more clearly. The markets are struggling to adjust for the damages created by the storm. We have havoc in the energy market with crude coming down on the announcement that supplies will be released from the Strategic Petroleum Reserve, but natural gas and gasoline are going through the roof due to infrastructure damages throughout the Gulf Coast. Treasuries have caught a huge bid, especially the two-year note, in a flight to safety. Interest rates are moving lower, as the Fed still talks of higher interest rates to come. The dollar finally caved today, but nothing can shake the Dow Industrials, as Dow 10,400 is vigorously defended!

-cut-

The markets were hit with some very negative news early this morning. The Commerce Department adjusted second quarter GDP down to 3.3% growth from the estimated 3.4% last month. This follows a growth rate of 3.8% in the first quarter. The economy is clearly slowing, and interest rate analysts are saying the Fed might now reconsider on their measured rate hikes.

The much bigger negative piece of news came from the Chicago Purchasing Managers when they said their Business Barometer fell to 49.2 from 63.5 in July, following expectations the number would drop to 61. This was the biggest decline on record and the first contraction in the NAPM index since April 2003, making a new 28 month low. The new orders index fell from 69.6 to 46.5; the production index dropped from 70.5 to 56.2; the measure of prices paid by manufacturers for materials rose from 61.3 to 62.9, and the employment index declined from 56.1 to 51.7. Four out of four components of the Purchasing Managers Report were all very negative for growth moving forward!

-cut-

The major stock indexes slumped in the first hour of trading, but refuse to go lower in the midst of all the bad news! With all the upheaval this week, the Dow Industrial Index absolutely refuses to close below the close last week. On Friday the Industrials closed at 10,397 and each day this week the index has gone below Friday’s close, but each day has crawled back to close higher, and in the last two hours of today’s session the index moved higher to close with a gain of 68 points at 10,481. Have a look at the chart to see what I mean:


more...

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

[legin]

2. A quick guide to futures markets

slightly off topic but it seemed like the logical place to post it.

Possibly I should have looked for this before, like about 2 or 3 years ago. :dunce:

(There are several pages to the article.)

http://www.investopedia.com/university/futures/

[UpInArms]

3. daily dollar watch

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

Last trade 87.24 Change -0.34 (-0.39%)

Will U.S. ISM Follow Chicago Down?

excerpt:

Outlook: For July, personal income growth is expected to remain at a 0.5% monthly rate, while spending growth is expected to accelerate again to 1.0% from 0.8%. Looking at the employment statistics, payrolls increased by 207,000 in July, while hourly earnings increased by 6 cents-much greater than June's increase of 3 cents. This definitely gives upside risk to the income growth number. Faster growth of spending is also well justified by the latest retail sales data which shows that auto sales advanced further in July than they did in June. This will be another hefty boost to spending on durable goods in this release. However, this kind of spending probably won't be sustained in the next few months as the pressure from energy prices builds. Also, the past few months have produced the lowest savings rates this nation has ever seen except for the -0.2% figure seen in October of 2001. Assuming that the median estimates are correct, July's savings rate will drop into negative territory again meaning that there isn't much steam building that could support this type of consumption going into the end of 2005.

Previous: In June, personal income growth accelerated more than expected to 0.5% from 0.2% in May while spending grew by 0.8% while not changing between April and May. Manufacturing wages fell after three months of increases whereas services industry wages continued their rise and grew by 0.3%. This drove personal spending to expand in all categories with the largest increase being in durable goods. Much of this could be from the additional purchases of automobiles prompted by promotions such as the General Motors employee discount. With all this zeal in spending, savings fell to a total of $1.9 billion out of over $10 trillion of income, thereby making the nation's savings rate nil. This is the lowest savings rate since it was briefly negative in 2001.

<snip>

U.S. ISM Manufacturing (AUG)(14:00 GMT, 10:00 EDT)
Consensus: 57.0
Previous: 56.6

Outlook: Median estimates predict that U.S. ISM manufacturing will rise to its highest level on the year. Such predictions may be overstated, however, as today’s Chicago Purchasing Manager survey showed that manufacturing in the Chicago area unexpectedly declined for the first time since April 2003. These results suggest that record-high oil prices are slowing factory demand and dragging down output. Consequently, outlook for tomorrow’s ISM data is less optimistic. The economic release will be particularly important to watch, as it could likely weigh on the U.S. Federal Reserve’s future interest rate considerations. The Fed has historically never raised interest rates with an ISM manufacturing reading below 50. With Chicago PMI crossing below 50, markets could see national ISM numbers likewise dip below the neutral mark.

Previous: July’s ISM manufacturing report showed that manufacturing rose to its highest level in a year, prompting improved optimism in American industrial production. Sky-rocketing oil prices seemed to have little effect on the figure, as new orders rose to their yearly high and production expanded at its fastest rate since September. Manufacturing had rebounded after swollen inventories prevented firms from boosting output earlier in the year. Heavy discounting in the automotive sector subsequently cleared stockpiles and allowed U.S. auto-makers to raise production. July’s positive report dispelled many doubts that surging energy costs would slow American industry. Subsequent data, however, suggests that future results may reflect the effects of crude oil trading at all-time record highs.

...more at link...

Dollar Slides as Weak Chicago PMI and Gasoline Shortages Counter Release of Oil Reserves

http://www.dailyfx.com/index.php?option=com_content&task=view&id=3175&Itemid=39

US Dollar

The dollar sold off over 150 pips today against the euro. For our readers, this move should come as no surprise since as early as Monday we were talking about how irrational the market was acting, rallying the dollar when the devastation of Hurricane Katrina was far from being over and the damage was yet to be properly assessed. Yesterday, we chimed in again and said that even though the dollar remained unchanged and the Conference Board survey was stronger, we doubted that the improvement in confidence was a real reflection of how Americans feel now. With at least 8 refineries (representing 9% of US refinery capacity) in the region still remaining shut and even though President Bush announced plans to release oil from the nation’s Strategic Reserves, we doubt that it would help much in such dire situations. Florida Governor Bush has already warned of possible gas shortages in the coming days in Florida because of Katrina. Airliners have cancelled flights and are rationing fuel, especially since hubs such as Washington’s Dulles Airport and Atlanta’s Hartsfield airport rely primarily on jet fuel supplies from Louisiana and Memphis. With most of Louisiana, Alabama and Mississippi expected to be at a near stand-still in terms of economic activity for at least a week, Katrina could shave a minimum of one percent off of Q3 GDP. As if things weren’t bad enough already, we had some extremely disappointing data release this morning. The preliminary Q2 GDP report indicated that the economy grew by only 3.3% compared to the market’s forecast for 3.4% growth. The biggest disappointment though came in the Chicago PMI report, which slipped from 63.5 to 49.2. We had expected a slide, but certainly did not anticipate that the slide would be so deep that it would indicate that the Chicago region’s manufacturing activity actually contracted during the month of August. This is exceptionally negative ahead of the release of the national ISM report tomorrow. With so many uncertainties ahead and clear signs of weakness, we doubt that the Federal Reserve would risk a sharp contraction in growth just to combat inflation – especially if this inflationary pressure could cause deflation in other sectors of the economy. We also think that even if this Friday’s non-farm payrolls report comes out strong, it may not do much to help the dollar because at this point, the one million people minimum evacuated out of the region could very well now be jobless. If this is really true, the September non-farm payrolls report could be horrendous even if the August report is good.

...more...

[UpInArms]

39. dollar in crater mode

Last trade 86.94 Change -0.64 (-0.73%)

Settle 87.58 Settle Time 23:29

Open 87.64 Previous Close 87.58

High 87.68 Low 86.94

Last tick: 2005-09-01 10:05:55 ET
30-min delayed quote.

[UpInArms]

44. still falling

Last trade 86.83 Change -0.75 (-0.86%)

Settle 87.58 Settle Time 23:29

Open 87.64 Previous Close 87.58

High 87.68 Low 86.76

Last tick: 2005-09-01 10:26:20 ET
30-min delayed quote.

and look at the charts on this page (refresh for the latest numbers)

http://www.weblinks247.com/exrate/

[UpInArms]

53. off the cliff

Last trade 86.70 Change -0.88 (-1.00%)

Settle 87.58 Settle Time 23:29

Open 87.64 Previous Close 87.58

High 87.68 Low 86.69

Last tick: 2005-09-01 11:16:20 ET
30-min delayed quote.

[54anickel]

67. Read between the lines of your post # 8

Europe was unnerved by how ill-prepared the world's biggest economy was for Hurricane Katrina's rampage.

The WORLD is loosing confidence in the US and it's paper. They are seeing what a cluster-fuck this country has truely become. We are unprepared for anything. Could you imagine what would happen if we were to have a terra-attack now? We are beyond the tipping point.

[UpInArms]

45. Gold up $10.70 to $448.80 oz

11:02am 09/01/05 DECEMBER GOLD UP $10.70 AT $448.80 AN OUNCE

[UpInArms]

49. Gold extends rally, up $10 on weak buck

http://www.marketwatch.com/news/story.asp?guid=%7BD0A96BE0%2D01AC%2D4CEC%2D922B%2D0FAB8015E3B5%7D&siteid=mktw

NEW YORK (MarketWatch) - Gold futures rallied Thursday, extending the prior day's sharp advance as it continued to benefit from the dollar's recent weakness, escalating violence in Iraq and higher energy prices.

The December gold contract last was quoted up $10.60 at $448.70 an ounce.

Peter Grandich, editor of the Grandich Letter, said gold futures continue to draw strength from the dollar's weakness. Gold, a traditional safe-haven investment, frequently trades in the opposite direction of the dollar.

The dollar is approaching some key technical levels and could drop considerably further if its breaks those levels, he said.

In addition, he predicted that the aftermath of Hurricane Katrina is likely to pressure the dollar further because the devastation in Gulf Coast states may persuade the Federal Reserve to back away from its current program of small, steady rate increases.

...more...

[UpInArms]

4. Today's Reports (It's MaeveDay or Truth to Power Day!):

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

Sep 1	8:30 AM		Initial Claims		08/27	-	310K	315K	315K	-	
Sep 1	8:30 AM		Personal Income		Jul	-	0.5%	0.5%	0.5%	-	
Sep 1	8:30 AM		Personal Spending	Jul	-	1.0%	1.0%	0.8%	-	
Sep 1	10:00 AM	Construction Spending	Jul	-	0.8%	0.5%	-0.3%	-	
Sep 1	10:00 AM	ISM Index		Aug	-	58.0	57.0	56.6	-
Sep 1	12:00 AM	Auto Sales		Aug	-	5.4M	5.3M	5.7M	-	
Sep 1	12:00 AM	Truck Sales		Aug	-	9.4M	8.8M	11.3M	-

[UpInArms]

10. Reports coming in:

8:30am 09/01/05 Neiman Marcus same-store sales rise 8.2% - Dan Burrows

8:29am 09/01/05 U.S. CONTINUING JOBLESS CLAIMS UP 36,000 TO 2.60 MLN

8:29am 09/01/05 U.S. 4-WK AVG. JOBLESS CLAIMS UP 1,250 TO 316,750

8:29am 09/01/05 U.S. INITIAL JOBLESS CLAIMS RISE 3,000 TO 320,000

8:30am 09/01/05 U.S. CORE INFLATION UP 1.8% YEAR-ON-YEAR, VS. 1.9%

8:30am 09/01/05 U.S. JULY CORE INFLATION UP 0.1%

8:30am 09/01/05 U.S. JULY SAVINGS RATE LOWEST SINCE 1959 AT LEAST

8:30am 09/01/05 U.S. JULY PERSONAL SAVINGS RATE NEGATIVE 0.6%

8:30am 09/01/05 U.S. JULY CONSUMER SPENDING UP 1% AS EXPECTED

8:30am 09/01/05 U.S. JULY PERSONAL INCOMES UP 0.3% VS. 0.5% EXPECTED

[UpInArms]

11. U.S. initial jobless claims rise 3,000 to 320,000 (l/w rev up 1,000)

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.3542448148-841072294&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Initial U.S. jobless claims for the week ending Aug. 27 rose by 3,000 to 320,000, the Labor Department said Thursday. The number was higher than economists expected. The four-week average of jobless claims was up by 1,250 to 316,750 and continuing jobless claims rose 36,000 to 2.60 million, the department said. The numbers released Thursday don't include jobless claim data related to Hurricane Katrina, a Labor Department official said.

[UpInArms]

16. more info: U.S. initial jobless claims rise to 320,000

http://www.marketwatch.com/news/print_story.asp?print=1&guid={2643BFD1-25C1-4715-B4B2-3A83349D2635}&siteid=mktw

WASHINGTON (MarketWatch) -- Initial U.S. jobless claims for the week ending Aug. 27 rose by 3,000 to 320,000, the Labor Department said Thursday.

It was the highest since July 9.

The four-week average of jobless claims was up by 1,250 to 316,750, the highest since July 30. Continuing jobless claims rose 36,000 to 2.60 million, the department said.

Economists surveyed by MarketWatch predicted initial claims to come in at about 315,000. See Economic Calendar.

Claims for the week ending Aug. 20 were revised upward to 317,000 from 315,000.

This week's numbers don't include jobless-claims data related to Hurricane Katrina, a Labor Department official said. Read the report.

But the department developed its own jobless claims estimates for Mississippi and Louisiana after failing to reach officials in those states.

...more...

[UpInArms]

12. U.S. July savings rate falls to -0.6%, lowest in 46 years

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.3542058912-841072267&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) - U.S. consumers spent more than they earned in July for just the second time in the last 46 years, the Commerce Department said Thursday. Personal incomes increased 0.3% in July, while spending soared ahead by 1%. The personal savings rate tumbled to negative 0.6%, the lowest since monthly records began in 1959. Economists were expecting incomes to rise 0.5% in July, with spending expected to rise 1%. The headline personal consumption expenditure price index rose 0.3%, eating up all income gains in the month. Core inflation increased 0.1%. Core inflation is up 1.8% in the past 12 months.

[UpInArms]

14. U.S. consumers tap wealth to fuel July spending boom

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2005-09-01T122930Z_01_N31383453_RTRIDST_0_ECONOMY-INCOME-URGENT.XML

WASHINGTON, Sept 1 (Reuters) - U.S. consumer spending rose a hearty 1 percent for the second straight month in July, outstripping a weaker-than-expected 0.3 percent rise in income and sending the personal saving rate into negative territory for only the second time on record, the government said on Thursday.

The saving rate, the percentage of disposable income consumers sock away, was a negative 0.6 percent, the smallest rate since monthly records began in 1959, the Commerce Department said.

It was the first negative saving rate since October 2001, right after the Sept. 11 attacks. The saving rate turns negative if consumers tap accumulated wealth in addition to current income to make purchases -- and they appeared to have done that in July to buy cars.

"An individual household's saving is unlikely to be positive over the short run when it makes a major purchase of a consumer durable good such as an automobile, and even at the aggregate level, personal saving may fluctuate in periods when an unusually high number of households make such purchases," the Commerce Department said in a statement.

The department's measure of consumer inflation, which is closely eyed by policy-makers at the Federal Reserve, advanced 0.3 percent, reflecting a run-up in energy prices. Excluding volatile food and energy costs, the so-called PCE price index edged up just 0.1 percent.

...more...

[54anickel]

20. That seems rather misleading, "lowest in 46 years" and "lowest since

monthly records begain in 1959". That would lead one to believe we've been here before, back in '59 and we survived just fine. I don't believe we started at a negative number in '59 though.

Anyone know where we can find out what the savings rate has been since the beginning of the record?

edit to add - I did find this in a quick search

http://banking.about.com/gi/dynamic/offsite.htm?site=http://money.cnn.com/2005/08/02/news/economy/savings/index.htm%3Fcnn=yes

snip>

June was only the second month the rate was at zero since the monthly figure started being calculated in 1959. The annual rate for 2004 was 1.8 percent; the last time the annual rate was lower was 1934.

snip>

"I find it just odd for all these economists and policy makers to be cheering for all this consumer spending when we're just digging ourselves into a hole," said Brusca. "With all the obligations we have ahead, to retirees and to ourselves, we have all the reasons in the world for people to be saving more and be controlling their spending."

more...

[UpInArms]

21. they only started keeping records in 1959

here is the chart since 2000

[54anickel]

22. Thanks UIA. So, we've never been here before except for 1934 per

the article I added to my post.

Heh-heh, guess it's better not to go "there".

[54anickel]

25. U.S. July Personal Spending Rises 1%; Incomes Increase 0.3%

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aR4kfisUiwRU&refer=home

Sept. 1 (Bloomberg) -- U.S. personal spending rose 1 percent for a second month in July, as consumers jammed automobile dealer showrooms to take advantage of discounts, a government report showed. The spending outlook has soured as Americans suffer record fuel costs in the aftermath of Hurricane Katrina, economists said.

The spending increase matched June's rise as the biggest since May 2004, the Commerce Department reported today in Washington. Incomes rose 0.3 percent after a 0.5 increase the previous month.

The price of gasoline futures in New York rose 36 percent in the last three days to reach a record $2.93 a gallon yesterday as Katrina shut oil refineries on the Gulf Coast. Those increases are making their way to the pumps, draining even more money from consumers' pockets, economists said. Recent retail sales surveys showed spending already slowed last month.

``The jump in energy prices during July and August represent a shock that could slow consumer spending and economic activity,'' said Michael Moran, chief economist at Daiwa Securities America Inc., before the report.

The jump in spending pushed the personal savings rate to a record-low minus 0.6 percent from zero in June. The only other negative reading occurred in October 2001, when auto purchases jumped as manufacturers introduced zero-interest loans to promote sales following the terrorist attacks.

The savings rate weighs current income from wages, salaries, dividends, businesses and government payments against spending. It doesn't take into account for borrowed money, income from investments, or rising home prices. Increased wealth from rising home values and higher stock prices have supplemented incomes and helped fuel spending. :eyes:

more...

[TrogL]

73. Rising home values in a housing bubble is NOT "increased wealth"

Especially with people funneling it off in home equity loans.

[UpInArms]

27. 10:00 reports in:

10:02am 09/01/05 U.S. AUG. ISM PRICES INDEX HIGHEST SINCE APRIL

10:01am 09/01/05 U.S. AUG. ISM JOB INDEX 52.6% VS 53.2% IN JULY

10:02am 09/01/05 U.S. AUG. ISM PRICES 62.5% VS 48.5% IN JULY

10:00am 09/01/05 U.S. AUG. ISM FACTORY INDEX BELOW 57.2% CONSENSUS

10:00am 09/01/05 U.S. AUG. ISM MANUFACTURING INDEX 53.6% VS 56.6% IN JULY

10:01am 09/01/05 U.S. AUG. ISM NEW ORDERS 56.4% VS 60.6% IN JULY

10:00am 09/01/05 U.S. JULY CONSTRUCTION SPENDING $1.1 TRILLION ANNUAL RATE

10:00am 09/01/05 U.S. JULY CONSTRUCTION SPENDING UNCHANGED FROM JUNE

[UpInArms]

28. U.S. July construction spending unchanged from June

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4167106944-841076601&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- U.S. construction spending in July was unchanged from June's seasonally adjusted annual rate of $1.1 trillion, the Commerce Department said Thursday. Economists surveyed by MarketWatch had been expecting construction spending to rise 0.6%. Spending on private construction rose 0.2% to $856 billion, while spending on public construction fell 0.8% to $243 billion, the department said.

Would levy funding have been in that category?

[UpInArms]

30. US construction spending unexpectedly flat in July

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2005-09-01T135931Z_01_N31383197_RTRIDST_0_ECONOMY-CONSTRUCTION-URGENT.XML

WASHINGTON, Sept 1 (Reuters) - U.S. construction spending was flat in July against forecasts for a 0.5 percent gain, government data showed on Thursday, following sharp revisions to previous months due to a change in methodology.

Construction outlays in July were reported at a seasonally adjusted annual rate of $1.099 trillion, unchanged from June, which was revised up from a previously reported $1.093 trillion. June spending was restated as a 0.6 percent decline from a 0.3 percent fall previously reported.

The Commerce Department said in a statement it had revised data back to January 2004 after deciding to revert to a smoothing process that had been suspended in its May annual revision.

<snip>

Total public construction declined 0.8 percent in July. Public residential outlays were down 1.9 percent while public spending on nonresidential building fell 0.8 percent.

...more at link...

More reporting revisions :eyes:

[UpInArms]

32. U.S. Aug. ISM factory index 53.6% vs 56.6% in July

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4248479861-841077315&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Factory activity in the United States decelerated in August, the Institute for Supply Management reported Thursday. The ISM index fell to 53.6% in August from 56.6% in July. The decline was unexpected. The consensus forecast of estimates collected by Marketwatch was for the index to rise to 57.2%. Readings above 50 indicate expansion. New orders slipped to 56.4% in August from 60.6% in July. The employment index fell to 52.6% from 53.2%. The price index spikes to 62.5%, the highest level since April.

More "surprised" economists. :argh:

[UpInArms]

58. Auto Sales tumbing in:

12:07pm 09/01/05 CHRYSLER GROUP U.S. AUG. SALES UP 5% TO 187,085

12:08pm 09/01/05 CHRYSLER GROUP ADJUSTED U.S. AUG. SALES UP 1%

12:06pm 09/01/05 FORD MOTOR AUGUST U.S. CAR SALES UP 22.2% TO 90,126

12:07pm 09/01/05 FORD MOTOR AUGUST U.S. TRUCK SALES UP 0.3% TO 198,303

12:05pm 09/01/05 FORD: VOLVO AUGUST U.S. SALES FALL 14.2% TO 10,806

12:06pm 09/01/05 DAIMLERCHRYSLER U.S. AUG. SALES UP 5% TO 206,352

12:04pm 09/01/05 FORD BRAND AUGUST U.S. SALES RISE 8% TO 242,849 UNITS

12:03pm 09/01/05 FORD MOTOR AUGUST U.S. SALES RISE 6.3% TO 288,429 UNITS

[UpInArms]

59. Ford August U.S. sales rise 6%; SUV sales slashed by a third

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.5052696065-841083180&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Ford Motor (F) on Thursday posted a 6% increase in August U.S. sales to 288,429 vehicles, with car sales leading the way, up 22% on the back of strong results from Ford Mustang, Focus and Five Hundred as well as the Mercury Montego. Record sales of F-Series pickups and a 52% jump in crossover utility vehicles offset lower SUV sales to keep total sales in the truck segment flat from a year ago. Overall, sales of traditional SUVs fell 33 percent.

[UpInArms]

60. DaimlerChrysler August U.S. sales rise 5%; Mercedes up 7%

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.5088114468-841083377&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- DaimlerChrysler (DCX) on Thursday posted a 5% increase in August U.S. sales to 206,352 vehicles, with the Mercedes-Benz side turning in a 7% rise to 19,267. The Chrysler Group, which is made up of Chrysler, Dodge and Jeep brands, sold 187,085 cars and trucks, up 5% from a year ago.

[UpInArms]

75. GM cars sales down 15%/truck sales down 16.8%

1:49pm 09/01/05 GM U.S. AUGUST CAR SALES DOWN 15% TO 150,900

1:50pm 09/01/05 GM U.S. AUGUST TRUCK SALES DOWN 16.8% TO 204,280

[UpInArms]

5. Crude prices edge past $69 a barrel

http://www.marketwatch.com/news/story.asp?guid=%7BF1EA9F15%2D87C0%2D4A7E%2D8A98%2D7B752C732C12%7D&siteid=mktw

NEW YORK (MarketWatch) - Energy futures resumed their upward move in electronic trade Thursday as investors continued to weigh the White House decision to release oil from strategic reserves to compensate for production shortages after Hurricane Katrina.

Traders said the move may ease the short-term panic in the market, which has driven futures for the entire petroleum complex to records this week. But with most refineries in the stricken area out of action, gasoline production is unlikely to keep pace with demand in the near term.

Crude futures ended under $69 a barrel in New York on Wednesday at $68.95, but crept up 21 cents to $69.15 a barrel in electronic trade Thursday. The contract touched a record $70.85 on Tuesday.

Unleaded-gasoline futures for October delivery were last up 12.5 cents, or 5.5%, at $2.38 a gallon.

October became the lead month for the petroleum products at Wednesday's close. The September contract struck a record of $2.90 a gallon on Wednesday before closing up 14 cents at $2.6145. Gasoline prices are up more than 51% from the end of last month.

...more...

[UpInArms]

8. Oil holds above $69, US scrambles for gas

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-09-01T115543Z_01_BAU072901_RTRIDST_0_BUSINESS-MARKETS-OIL-DC.XML

LONDON (Reuters) - Oil held above $69 within sight

of its record on Thursday as the United States scrambled for

gasoline to replace supplies lost when Hurricane Katrina slammed

into Gulf of Mexico rigs and refiners.

President George W Bush told Americans he expected close

ally Saudi Arabia to do "everything it can" to provide the

United States with more oil and said there would be zero

tolerance of price gouging at the gasoline pump.

Europe was unnerved by how ill-prepared the world's biggest

economy was for Hurricane Katrina's rampage.

...more...

[UpInArms]

9. AAA daily avg gas price at record $2.68/gallon

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.3459926968-841071813&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) -- The U.S. average price for unleaded gasoline hit a new record of $2.68 a gallon Thursday, surpassing the previous record of $2.619 a gallon hit the previous day, according to AAA. The auto association said the average price was $1.857 on Aug. 31, 2004, and was $2.283 a gallon a month ago. Diesel prices also hit a record of $2.689 a gallon on average Thursday, compared with $2.422 a month ago. (Correcting the day to Thursday from Wednesday)

[Roland99]

17. That's BS. It's gotta be about $2.90 if not $3.

[UpInArms]

29. Current Crude Prices ($6.25 bbl):

10:05am 09/01/05 OCT CRUDE CLIMBS 31C TO $69.25/BRL IN EARLY NY TRADE

10:05am 09/01/05 OCT NATGAS FALLS 13.7C TO $11.34/MLN BTU AHEAD OF STOCK DATA

10:05am 09/01/05 OCT UNLEADED GAS UP 5.5% AT $2.38/GAL

10:05am 09/01/05 OCT HEATING OIL UP 3.1% AT $2.14/GAL

[UpInArms]

35. Unleaded gas heads higher for a fourth session

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4257522222-841077374&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Unleaded gasoline futures climbed on the heels of a three-session winning streak on lingering concerns over fuel supplies in the wake of Hurricane Katrina. October unleaded gas was up 17.47 cents, or 7.8%, at $2.43 a gallon. October crude fell 4 cents to $68.90 a barrel and October heating oil tacked on 5.85 cents, or 2.8%, to $2.135 a gallon. October natural gas was down 17.2 cents, or 1.5%, at $11.30 per million British thermal units ahead of a weekly update on supplies from the Energy Department. Global Insight expects the report to show a 58 billion-cubic-foot climb in last week's natural-gas supplies.

[UpInArms]

40. Energy Dept posts 58 bln cubic foot rise in natgas stks

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4413423148-841078473&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- The Energy Department said U.S. natural-gas stocks rose by 58 billion cubic feet for the week ended August 26, in line with expectations by analysts at Global Insight. Total stocks now stand at 2.633 trillion cubic feet, down 50 billion cubic feet from the year-ago level, but up 130 billion cubic feet from the five-year average, the government data said. October natural gas is down 7.2 cents at $11.40 per million British thermal units in New York after trading as low as $11.22 earlier.

[UpInArms]

55. Natural-gas prices up as traders digest latest supply rise

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.485875544-841081596&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

SAN FRANCISCO (MarketWatch) -- October natural gas is up 20.8 cents, or 1.8%, at $11.68 per million British thermal units in New York, reversing an earlier fall to a low of $11.22. The Energy Department reported an increase to last week's supplies in storage of 58 billion cubic feet. That was in line with some market expectations, but below others. October unleaded gasoline is also up 6.9% at $2.41 a gallon. October crude, however, lost 19 cents to $68.75 a barrel.

[UpInArms]

43. Energy Dept. says company withdrew request for reserve oil

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4496008565-841079046&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- The Energy Department said it will not need to release oil from the nation's petroleum stockpiles to an unidentified company that had made a request for supplies this week following Hurricane Katrina. On Wednesday the company "rescinded its request," said Craig Stevens, a spokesman for the department. The company was able to receive planned deliveries of oil from commercial sources alleviating its need for federal supplies, according to the Energy Department. The department continues to review other pending requests for supplies from the reserve.

Was there only one request for reserves granted? If so, then there are no scheduled releases from the National Petroleum Reserves.

hmmmmm.....

Who was that "unnamed and unidentified company"?

[UpInArms]

63. Valero requests 1.5M barrels of crude from U.S. oil reserve

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.5180871644-841083964&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Valero Energy Corp. (VLO) said Thursday it has asked the Energy Department to provide the refiner with 1.5 million barrels of crude oil from the government's emergency oil stockpiles in the Gulf of Mexico. Valero said the oil is needed for two recently acquired refineries located in Memphis, Tennessee and Lima, Ohio, and for a third refinery in Krotz Springs, Louisiana. The additional supplies "should bring our Krotz Springs facility to full rates by this Sunday," Valero said in a statement. The Krotz Springs refinery is located roughly halfway between Baton Rouge and Lafayette, Louisiana. The Energy Department said it is continuing to review requests for oil.

[UpInArms]

50. Another day, another gasoline record (up 44.3% from year ago)

http://www.marketwatch.com/news/story.asp?guid=%7B1BFEEC04%2D8C14%2D49D4%2DBE04%2D89FA81413686%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Consumers have been forced to suffer another day with record retail gasoline prices Thursday, and analysts believe there's no end to the climb in sight.

At the retail level Thursday, the average price for unleaded gasoline hit a new record of $2.68 a gallon, surpassing the previous record of $2.619 a gallon hit the previous day, according to AAA.

Prices are up 44.3% from a year ago. See the data.

"Gasoline will still be scarce, highly prized, and terribly volatile in the next few weeks," said Tom Kloza, chief oil analyst at the Oil Price Information Service.

The Colonial and Plantation Pipelines -- two key pipelines which provide the majority of gasoline, diesel fuel, and jet fuel to the Southeast, Mid-Atlantic, and Northeast states -- are restarting, "but not clear when the barrels make the trip to starved areas," he said.

...more...

[UpInArms]

6. Hunt for $440m vanished from hedge fund

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2005/09/01/cnbayou01.xml&menuId=242&sSheet=/money/2005/09/01/ixcity.html

United States authorities have renewed their calls for tighter regulation of the hedge fund industry as an investigation into $440m missing from a Connecticut money manager gathers pace.

Samuel Israel III, founder of Bayou Management, wrote to investors at the end of July, telling them he was shutting the four funds run by his company and would return their money.

So far, none has been reimbursed, triggering inquiries by the Federal Bureau of Investigation, the Securities and Exchange Commission and the Connecticut Department of Banking.

It is the largest case of suspected fraud at a hedge fund and follows on from a similar scandal to hit KL Financial in Florida earlier this year where around $250m went missing.

...more...

[UpInArms]

7. Treasury's Adams sees more flexible yuan

http://today.reuters.com/news/newsArticle.aspx?type=reutersEdge&storyID=2005-08-30T195136Z_01_T298878_RTRIDST_0_PICKS-ECONOMY-CHINA-ADAMS-DC.XML

TOKYO (Reuters) - U.S. Treasury Undersecretary Tim Adams said on Tuesday that China's moves so far to revalue its currency were welcome but there was a widespread expectation that Beijing will do more to let the yuan's value rise.

In an interview with Reuters Television while visiting Tokyo, Adams said the United States was pleased by the approximate 2 percent revaluation of the yuan that China announced in July.

"We applauded the move at the time, the breaking of the 10-year link to the dollar, but built into that applauding is an assumption that greater liberalization will occur over time," he said.

Adams was in Tokyo meeting business leaders and Japanese government officials until Wednesday, when he heads for Dalian, China, to participate in a meeting of deputies from the Group of 20 countries where currency issues are expected to again be on the table.

Asked about the potential economic impact of soaring world oil prices, Adams said it was something that had to be monitored carefully but it was hard to know whether prices were near levels that cause pain to global prospects.

"I'm not sure where the threshold is," Adams said. "Obviously oil at $70 a barrel, $65 a barrel, is something that we should monitor very closely. It will likely have some effect on the U.S. economy, we don't really know at this point, but it's something that we'll certainly watch very closely."

...more...

[54anickel]

23. Heh-heh, they'll revalue when they want another discount on oil...n/t

[UpInArms]

13. Neiman Marcus same-store sales rise 8.2%

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.3546196644-841072316&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) -- Neiman Marcus Group Inc. (NMGA) (NMGB) said Thursday that August same-store sales, or sales from stores open at least a year, rose 8.2%, while total sales for the four weeks ended Aug. 27 gained 6.5% to $255 million. The Dallas-based retailer's stock closed Wednesday at $98.90, up 25 cents.

[UpInArms]

15. Check Kiting Continues: Fed adds reserves through 14-day system repurchase

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-01T122322Z_01_N01301278_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, Sept 1 (Reuters) - The Federal Reserve said on Thursday that it added temporary reserves to the banking system through 14-day system repurchase agreements.

Fed funds last traded at 3.563 percent, above the Fed's target of 3.5 percent for the rate on overnight loans between banks.

Further details of the operations are available at: http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[UpInArms]

18. pre-opening blather

8:55AM: S&P futures vs fair value: +1.0. Nasdaq futures vs fair value: +1.5. Futures indications still suggest a flat open for the cash market. Some early retailers moving on same store sales data include Starbucks (SBUX 50.02 +0.99), Nordstrom (JWN 41.94 +8.36) and American Eagle Outfitters (AEOS 27.10 -1.53). At 10 ET, the market's attention will turn to the ISM Index, a gauge of national manufacturing activity. The consensus estimate is 57.0, up slightly from the prior reading of 56.6.

8:31AM: S&P futures vs fair value: -0.2. Nasdaq futures vs fair value: +1.0. Initial claims checked in at 320K versus the consensus estimate of 315K... Personal income was +0.3 (consensus +0.5) and personal spending was +1.0 (consensus +1.0)... Initial reaction is muted... Futures trade continues to signal a relatively flat start for the cash market.

7:56AM: S&P futures vs fair value: +0.2. Nasdaq futures vs fair value: +1.0. Futures trading suggests a relatively flat start for the cash market. The price of crude oil is heading back north, with October futres contracts currently trading at $69.20/bbl. The retail sector may receive some added attention today, as a slew of mixed same store sales data hit the early wires. Separately, initial claims and personal income and spending data will be released at 08:30 ET.

[UpInArms]

19. U.S. house prices up 13.4% in past year

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.3853249537-841074515&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- U.S. house prices have risen 13.4% in the past year, the fastest appreciation since 1979, the Office of Federal Housing Enterprise Oversight said Thursday. Home prices rose at a 12.8% annual rate in the second quarter. "There is no evidence here of prices topping out," said OFHEO Chief Economist Patrick Lawler. "On the contrary, house price inflation continues to accelerate, as some areas that have experienced relatively slow appreciation are picking up steam." Thirty metro areas had price appreciation of more than 25% in the past year, led by Naples, Fla.

[4dsc]

24. Higher priced homes for sure

as the homes in my neighborhood are not selling well at all. Last year, houses moved rather quickly, this years, many have sat for months, very unusual!!

[Zynx]

31. Accelerating growth rates are the last sign of a bubble.

The market continued to produce more and more fantastic returns before it popped. It shall be the same with housing.

[UpInArms]

33. U.S. July pending home sales index slips 1%

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.4239347106-841077243&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Pending home sales slipped in July, yet remained at very high levels, the National Association of Realtors said Thursday. The pending home sales index dropped 1% to 125.1, the industry group said. The index is 3.5% higher than in July 2004. The index is designed to be a leading indicator for existing home sales, but the data is still considered experimental. "The pending home sales index is at the fifth highest reading on record, meaning we can expect historically high home sales to continue in the months ahead," said David Lereah, chief economist for the realtors' group.

[UpInArms]

26. 9:45 EST mixed with blather

Dow 10,484.41 +2.81 (+0.03%)
Nasdaq 2,152.01 -0.08 (-0.00%)
S&P 500 1,221.86 +1.53 (+0.13%)
10-Yr Bond 4.036 +0.16 (+0.40%)

NYSE Volume 158,774,000
Nasdaq Volume 152,839,000

9:40AM: As futures trading had suggested, the cash market opened on a relatively lackluster note. Retailers occupy the early spotlight, with a plethora of August same store sales reports delivered today. Wal-Mart (WMT 45.01 +0.05) reported sales in-line with expectations, Nordstrom (JWN 34.40 +0.82) beat the consensus nearly two-fold, and upside results have also come from the likes of Dress Barn (DBRN 25.25 +1.25), CVS (CVS 29.94 +0.57), and Abercrombie & Fitch (ANF 55.41 -0.20). Gap (GPS 18.56 -0.45), meanwhile, has been one of the biggest disappointers.

9:14AM: S&P futures vs fair value: -0.1. Nasdaq futures vs fair value: -0.5.

[UpInArms]

34. 10:15 EST numbers and blather

Dow 10,452.47 -29.13 (-0.28%)
Nasdaq 2,147.42 -4.67 (-0.22%)
S&P 500 1,220.63 +0.30 (+0.02%)
10-Yr Bond 4.034 +0.14 (+0.35%)

NYSE Volume 364,237,000
Nasdaq Volume 319,489,000

10:00AM: Major indices holding close to the flat line, but energy stocks remain in a leadership position and are benefitting from steep prices across the energy complex (gasoline at $2.429/gal; natural gas at $11.30 per mln BTUs; crude oil at $68.80/bbl). Lehman Brothers' upgrade of refiners has given issues like Valero (VLO 110.84 +4.34), Tesoro (TSO 61.31 +3.51), and Conoco Phillips (COP 68.67 +2.73) added bounce. Separately, news just crossing the wires that the August ISM Index checked in at 53.6 versus the 57.0 consensus and the 56.6 prior read.

(edited for html)

[UpInArms]

37. 10:22 EST blood all over the floor

Dow 10,432.16 -49.44 (-0.47%)
Nasdaq 2,144.18 -7.91 (-0.37%)
S&P 500 1,216.92 -3.41 (-0.28%)
10-Yr Bond 4.035 +0.15 (+0.37%)

NYSE Volume 417,540,000
Nasdaq Volume 356,958,000

[UpInArms]

38. US blue chips slide, hurt by high gasoline prices

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-01T142648Z_01_N01438384_RTRIDST_0_MARKETS-STOCKS-UPDATE-4.XML

NEW YORK, Sept 1 (Reuters) - U.S. blue-chip stocks dropped in early Thursday trading on fears that surging retail gasoline prices would take a toll on consumer spending.

The market was also weighed down by an Institute for Supply Management report that U.S. manufacturing activity declined in August.

Shares of economically sensitive blue chips, including International Business Machines Inc. (IBM.N: Quote, Profile, Research), Boeing Co. (BA.N: Quote, Profile, Research) and General Electric Co. (GE.N: Quote, Profile, Research), were lower.

<snip>

"Two dollars a gallon the consumer can handle, but approaching $3 and $4 a gallon is going to be a problem for the consumer," said Michael Bee, lead equity strategist at Boyd Watterson Asset Management LLC of Cleveland. "There's going to be a lot of volatility between consumer cyclicals and energy stocks on a short-term basis here."

...more...

[UpInArms]

41. 10:40 EST numbers and blather

Dow 10,436.30 -45.30 (-0.43%)
Nasdaq 2,143.63 -8.46 (-0.39%)
S&P 500 1,217.52 -2.81 (-0.23%)
10-Yr Bond 3.997 -0.23 (-0.57%)

NYSE Volume 534,208,000
Nasdaq Volume 436,625,000

10:25AM: The major averages move lower as traders remain focused on Katrina's damage and digest the morning's economic data... The ISM Index, which was weaker than expected at 53.6, still connotes an expansionary environment... Nonetheless, the trend in the index, which is down from 56.6 in July, is feeding the burgeoning sense in the Treasury market that the Fed will end its tightening activity sooner than expected... To that end, Treasuries got a boost after the ISM number, with the front of the curve (the most sensitive to fed funds rate moves) outperforming the back end...

The spread between the 2-yr and 10-yr notes has widened to 29 basis points versus a gap of just 11 basis points seen Tuesday... . NYSE Adv/Dec 1659/1137, Nasdaq Adv/Dec 1285/1298

[UpInArms]

36. US Treasuries mixed, with steepening yield curve

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-01T134601Z_01_N01343751_RTRIDST_0_MARKETS-BONDS-UPDATE-1.XML

NEW YORK, Sept 1 (Reuters) - U.S. Treasury debt prices turned mixed on Thursday as the bond market ignored benign inflation data and turned its attention to the prospect of high oil prices cutting short the Federal Reserve's campaign to raise interest rates.

Short-dated notes rose in price and longer-dated issues fell, which served to steepen a yield curve that had been trending relentlessly narrower in a shift many have begun interpreting as a bad omen for the economy.

The bond market had been on three-week rally fueled by concerns spiking oil prices risk undermining U.S. economic growth. Oil futures in New York settled on Wednesday at $68.94 a barrel, nearly $2 shy of the $70.85 record set this week.

"The curve is steepening. That's what happens when people think the Fed is going to pause."

...more...

[UpInArms]

42. Hurricane's Economic Impact May Hold Political Peril for Bush

http://www.bloomberg.com/apps/news?pid=10000087&sid=a_AJTGz6QOJI&refer=top_world_news

Sept. 1 (Bloomberg) -- President George W. Bush moved to marshal federal resources in response to Hurricane Katrina, a natural catastrophe that holds economic and political peril for a leader already facing rising gasoline prices and falling approval ratings.

<snip>

``Gas prices are the classic pocketbook issue for the average person and the average family, and these are things that they notice very much,'' said Charlie Black, a Washington-based Republican strategist who was an adviser to former President George H.W. Bush. ``It helps explain the paradox we see in the polls: The economy is very good, but right now a majority of people say it isn't. The hurricane, and its aftermath, will only exacerbate this problem.''

A Washington Post/ABC News poll put Bush's overall job approval rating at 45 percent, a decline of 7 percentage points since January and the lowest figure ever recorded by that poll. Two-thirds of the 1,006 adults surveyed Aug. 25-28 said rising gas prices are causing them financial strain.

<snip>

Nariman Behravesh, chief economist at Global Insight in Lexington, Massachusetts, said the disruption to the nation's economy resulting from Katrina may cut a full percentage point from fourth-quarter economic growth.

...more...

[UpInArms]

46. 11:13 EST recovery in progress

Dow 10,465.92 -15.68 (-0.15%)
Nasdaq 2,149.96 -2.13 (-0.10%)
S&P 500 1,221.20 +0.87 (+0.07%)
10-Yr Bond 4.013 -0.07 (-0.17%)

NYSE Volume 724,601,000
Nasdaq Volume 571,230,000

11:00AM: The tech sector (-0.48%) weighs upon the overall market, with bellwethers like Dell (DELL 35.21 -0.39), Microsoft (MSFT 27.17 -0.21), Intel (INTC 25.47 -0.25), Hewlett-Packard (HPQ 27.41 -0.35) and Cisco (CSCO 17.60 -0.02) all below the flat line. Prudential's downgrade of the semiconductor equipment group to Unfavorable from neutral, and the semiconductor group to Neutral from favorable, along with UBS's downgrade of SanDisk (SNDK 38.11 -0.72) has contributed to thesector's underperformance. Within it, though, the computer storage and peripherals group (+1.78%) has emerged as a pocket of relative strength. The indices have held relatively steady over the past half hour.NYSE Adv/Dec 1456/1461, Nasdaq Adv/Dec 1183/1538

[KoKo]

47. Destruction Doesn't Create Benefits/ Motley Fool..

(:hi: all)

http://biz.yahoo.com/fool/050831/112551087014.html?printer=1
Wednesday August 31, 1:54 pm ET
By Nathan Parmelee (TMF Doraemon) Hurricane Katrina has had a direct impact on members of the Motley Fool family and there are a number of heavy hearts today at Fool HQ. Our thoughts and prayers go out to all of the survivors who are recovering in the aftermath of the storm.

Leaving that personal note aside, we are a business dedicated to investing, and that requires an understanding of some basic economic concepts. With that in mind, I'd like to tackle an economic fallacy that has been cropping up in some of the hurricane coverage.

The argument that I saw today in the Charlotte Observer -- and that you're likely to see or hear as well -- goes something like this: Disasters like Hurricane Katrina stimulate the economy as people make purchases to replace what they have lost. No doubt, many trips will be made to Home Depot (NYSE: HD - News) and Lowe's (NYSE: LOW - News). People who lost cars will hit the showrooms of General Motors (NYSE: GM - News), Toyota (NYSE: TM - News), and others for new wheels. The recipients of this money will naturally then turn around and spend some of it.

At first glance, it might appear that this spending boosts the economy, but a closer look reveals that the benefits just aren't there. In the book Economics in One Lesson, Henry Hazlitt dispels what he terms the "broken window fallacy" with a very simple example of a boy who breaks a window (more on the book can be found here and here). The window then needs to be replaced, and much like in my example above, there are certain parties who do benefit from the man paying to have his window replaced.

The point that is missed is that before Hurricane Katrina made landfall -- or before the window was broken in Hazlitt's example -- all of those folks had houses that were intact, cars, and savings that they had planned to spend on other things. In Hazlitt's book, the man with the broken window has to take money that was earmarked for a suit and spend it to replace the window. Instead of having a suit and a window, he then has only a window.
http://biz.yahoo.com/fool/050831/112551087014.html?printer=1

[UpInArms]

48. Hiya KoKo!

:hi:

and that last paragraph should signal a warning:

In some way, all of the companies that would have received income from those purchases will now suffer. So as you watch all the spending that occurs in the aftermath of Katrina and events like it, don't forget about the spending that won't happen.

[UpInArms]

51. 11:43 EST all is well in the Land of LaLa

Dow 10,510.66 +29.06 (+0.28%)
Nasdaq 2,155.71 +3.62 (+0.17%)
S&P 500 1,227.29 +6.96 (+0.57%)
10-Yr Bond 4.009 -0.11 (-0.27%)

NYSE Volume 916,491,000
Nasdaq Volume 702,453,000

11:30AM: While the August ISM Index was deemed disappointing, the market has managed to pare its losses, aided by the drop in long-term rates... The 10-yr, which has dipped below 4.00% today, is now yielding 4.01%... Arguably, the the action in the 2-yr note is the real source of support as it can be seen that participants are pricing out the probability of three Fed tightenings through year-end...

In terms of the stock market, the consumer discretionary sector has been the session's biggest drag, with the apparel group leading the way lower on the back of disappointing same store sales results from Gap (GPS 18.78 -0.23) and Limited Brands (LTD 21.16 -0.82). Restaurants are further pulling down the sector, with McDonald's (MCD 31.96 -0.49), Darden (DRI 30.09 -1.32), Wendy's (WEN 40.65 -0.39) and Yum Brands (YUM 47.23 -0.15) all trending negative.NYSE Adv/Dec 1652/1368, Nasdaq Adv/Dec 1303/1507

[Roland99]

52. Brit Hume put in his buy order, eh?

[UpInArms]

54. maybe the Meanspin/Idiotsonofanutjob lunch date has given

everyone the warm fuzzies?

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38596.487455706-841081690&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

WASHINGTON (MarketWatch) -- President Bush and Fed chairman Alan Greenspan will meet at noon to discuss the economic impact of Hurricane Katrina, a White House spokesman said Thursday. White House spokesman Scott McClellan told reporters that Bush would have lunch with Greenspan before the president meets with his economic team. The lunch would be a chance for Bush to get a preliminary reading on the economic impact of the hurricane, McClellan said.

[Roland99]

56. Hmm...1-2 million homeless/jobless. Pffft...just a hiccup.

Carry on

[UpInArms]

57. Stocks turn higher on steady oil, rate hopes

http://www.marketwatch.com/news/story.asp?guid=%7B756ED83E%2DF3C9%2D4DD1%2D87F4%2D2B9BF4C937DA%7D&siteid=mktw

NEW YORK (MarketWatch) - U.S. stocks turned higher Thursday as oil held steady under $69 a barrel and hopes rose the Fed would mark a pause in its cycle of interest rate hikes due to the negative impact of Hurricane Katrina on the economy.

The Dow Jones Industrial Average ($INDU: news, chart, profile) rose 21 points to 10,501, off a morning low of 10,425.80.

The Nasdaq Composite Index ($COMPQ: news, chart, profile) rose 3 points to 2,155 while the S&P 500 Index ($SPX: news, chart, profile) rose 6 points to 1,226.

"The market doesn't really know what the full impact of the storm is and there is maybe a lurking suspicion that a lot of the oil price movement is strictly speculative," said Ed Peters, chief investment officer at Pan Agora, in explanation for the relative resilience of the market. "It's not as fundamental as everyone would like to believe."

<snip>

"Even accounting for the larger property destruction of Katrina, this storm will impose much larger losses than previous hurricanes and floods, because of the lack of federal and state preparation for storms and flooding in southern Louisana."

...more...

[ozymandius]

70. Silly rabbits!

Don't they know hope is not a plan?

[UpInArms]

61. Novellus eyes charges for (Arizona) plant shutdown

http://www.marketwatch.com/news/story.asp?guid=%7B9C0DBDAD%2DCE9F%2D4B16%2DA918%2D0FDF9DD2C6E0%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) - Novellus Systems Inc., the chip-equipment maker, plans to incur an undisclosed amount of restructuring charges over the next four quarters stemming from a decision to shutter its Arizona plant.

Separately Thursday, Novellus named William Kurtz chief financial officer. He will replace interim CFO John Chenault, who plans to retire by the end of the year.

In midday trading, Novellus (NVLS: news, chart, profile) fell 39 cents, or 1.5%, to $26.42.

The San Jose, Calif.-based company did not quantify the amount of charges related to closing its Chandler, Ariz. plant. The facility is expected to be closed by June 2006. The operations will be relocated to San Jose, Calif. and Tualatin, Ore. by next March.

In a filing made late Wednesday with the Securities and Exchange Commission, Novellus said it is unable to "make a determination" of the estimated costs associated with the plant closure. The company could not be reached for immediate comment.

...more...

[UpInArms]

62. 12:20 EST numbers and blather

Dow 10,486.54 +4.94 (+0.05%)
Nasdaq 2,153.28 +1.19 (+0.06%)
S&P 500 1,224.83 +4.50 (+0.37%)
10-Yr Bond 4.033 +0.13 (+0.32%)

NYSE Volume 1,083,370,000
Nasdaq Volume 817,976,000

12:00PM: Trading began on a lackluster note, but the market soon took a hit with the release of a disappointing ISM Index report. The data indicated that national manufacturing declined 5.3% since July (to 53.6 versus the 57.0 consensus), and sent the indices lower on initial impact. The market has managed tofight back from its early losses, however, aided by the drop in market rates. Specifically, the 10-year note dipped below 4.00% at one point and now stands at 4.02%; meanwhile, the 2-yr note, at 3.75%, has continued to rally on the belief high energy prices and the economic impact of Katrina will allow the Fed to end its tightening activities sooner than expected... The latter consideration was a real source of support that fostered the comeback from the ISM-induced losses...

Additionally, a decline in crude prices (now 68.90/bbl) has helped somewhat, but a further rise in gasoline prices (now $2.385/gal) and natural gas prices (now $11.80 per mln BTUs) have been mitigating factors. Once again, the energy sector (+2.46%) has been the best-performing standout. It has added company today, though, as the drop in rates and the steepening of the yield curve have piqued buying interest in the influential financial sector (+0.71%). On the other hand, consumer discretionary (-0.33%) has been the session's weakest sector as a number of uninspiring same store sale reports for August have kept retailers like Gap (GPS 18.66 -0.35), Limited (LTD 21.07 -0.91) and TJX Cos. (TJX 20.84 -0.07) on the defensive. Technology (-0.05%) has been another relative laggard as losses in the semiconductor equipment group, which was downgraded at Prudential to Unfavorable from Neutral, have acted as a drag...

[UpInArms]

64. more dreck

12:30PM: The stock market continues to hold its ground, with the indices vacillating around the unchanged line... A 4.3% gain in Archer-Daniels-Midland (ADM 23.47 +0.96)has lent support to the S&P. Along that line, a Katrina-related surge in Catepillar (CAT 56.70 +1.21) is helping to keep the Dow steady... Certainly of note, reports indicate that President Bush and Fed Chairman Greenspan began a meeting at 12 ET... Presumably, the President is looking for insight from Greenspan on the economic impact of Katrina...

Regardless of what is being discussed, the meeting between these two will feed the view working its way into Treasury market that the Fed will be inclined to end its tightening activity sooner than expected. NYSE Adv/Dec 1986/11263, Nasdaq Adv/Dec 1490/1395

[UpInArms]

65. PIEHOLE ALERT:

12:42pm 09/01/05 WHITE HOUSE: IN TALKS WITH CONGRESS ON LONG-RUN KATRINA AID

12:41pm 09/01/05 WHITE HOUSE:FUNDS IN PLACE TO COPE WITH KATRINA IN SHORT RUN

12:33pm 09/01/05 NO ESTIMATE YET OF COST OF KATRINA CLEANUP: WHITE HOUSE

12:29pm 09/01/05 MASSIVE FEDERAL RESPONSE TO KATRINA UNDERWAY: WHITE HOUSE

[54anickel]

68. Underway, on the cusp, any day now, money's ready just waiting for

them to request help. :puke:

I heard something last night that the WH hasn't yet received any requests. :wtf: :banghead: :pullinghairfranticallyfromhead:

[54anickel]

66. Suit alleges credit-cards colluded - WSJ

http://today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2005-09-01T064119Z_01_DIT123932_RTRIDST_0_BUSINESS-FINANCIAL-CREDITCARDS-WSJ-DC.XML

NEW YORK (Reuters) - A lawsuit filed in New York federal court alleges eight leading credit card companies violated U.S. antitrust laws by colluding to promote arbitration of customer disputes, the Wall Street Journal reported on Thursday.

It said the complaint alleges Bank of America Corp. (BAC.N: Quote, Profile, Research), Capital One Financial Corp. (COF.N: Quote, Profile, Research) Corp., J.P. Morgan Chase & Co (JPM.N: Quote, Profile, Research), Morgan Stanley's (MWD.N: Quote, Profile, Research) Discover unit, Citigroup Inc. <C.N>, MBNA Corp. (KRB.N: Quote, Profile, Research), Providian Financial Corp. (PVN.N: Quote, Profile, Research) and Britain's HSBC Holdings plc (HSBA.L: Quote, Profile, Research) "combined, conspired and agreed to implement and/or maintain mandatory arbitration."

Many of the largest U.S. credit-card companies require customers to sign away their ability to take disputes to court and instead settle disagreements in arbitration, the newspaper said. Now that practice itself is under attack in court.

The suit was filed on behalf of seven plaintiffs who live in California, Pennsylvania, New York, Illinois and New Jersey.

Some of the banks named allegedly convened a group in 1999 called the "Arbitration Coalition" or "Arbitration Group," the complaint says, according to the Journal.

more...

[TrogL]

69. Loonie Watch

http://members.shaw.ca/trogl/looniewatch.html

Highlights.



http://www.x-rates.com/d/USD/CAD/data30.html

Detailed analysis (http://quotes.ino.com/exchanges/?r=CME_CD)

Up-to-the-minute graph (http://quotes.ino.com/chart/?s=CME_CDY&v=i)

Current TSE:




2005-08-01 Monday, August 1 0.823995 USD
2005-08-02 Tuesday, August 2 0.824946 USD
2005-08-03 Wednesday, August 3 0.824538 USD
2005-08-04 Thursday, August 4 0.825151 USD
2005-08-05 Friday, August 5 0.820681 USD
2005-08-08 Monday, August 8 0.824266 USD
2005-08-09 Tuesday, August 9 0.823723 USD
2005-08-10 Wednesday, August 10 0.825559 USD
2005-08-11 Thursday, August 11 0.831601 USD
2005-08-12 Friday, August 12 0.8371 USD
2005-08-15 Monday, August 15 0.835561 USD
2005-08-16 Tuesday, August 16 0.834725 USD
2005-08-17 Wednesday, August 17 0.8285 USD
2005-08-18 Thursday, August 18 0.821153 USD
2005-08-19 Friday, August 19 0.82291 USD
2005-08-22 Monday, August 22 0.830565 USD
2005-08-23 Tuesday, August 23 0.834655 USD
2005-08-24 Wednesday, August 24 0.8364 USD
2005-08-25 Thursday, August 25 0.841184 USD
2005-08-26 Friday, August 26 0.83689 USD
2005-08-29 Monday, August 29 0.835771 USD
2005-08-30 Tuesday, August 30 0.838997 USD
2005-08-31 Wednesday, August 31 0.840831 USD




The loonie appears to still be the currency of choice for those bailing out of the greenback. Go to my website (link below) and look at the long term graphs.

Obviously, the Alberta economy is booming. The city I'm in has gone on an infrastructure boom. I swear they've got every street, highway and alley torn up.

A contractor friend of mine can't find workers. He needs 10 people right now but everybody who can lift a hammer is already working.

[TrogL]

74. OK, looks like we lost the link

Loonie Watch

It's also at the top of the previous post.

[ozymandius]

71. 1:16

Dow 10,471.65 -9.95 (-0.09%)
Nasdaq 2,150.63 -1.46 (-0.07%)
S&P 500 1,222.65 +2.32 (+0.19%)
10-Yr Bond 40.36 +0.16 (+0.40%)
NYSE Volume 1,294,917,000
Nasdaq Volume 966,178,000

1:00PM: Little has changed since the last update. Aside from the energy sector, the materials sector (+0.59%) has been one of the session's best performers, bolstered by gains in the gold, aluminum, diversified metals, and steel groups... Similarly, the utilities sector (+0.97%) is also faring well as it catches a bid driven by the drop in market rates and safe-haven buying activity as the market continues to confront the uncertainty left in Katrina's wake... . NYSE Adv/Dec 1975/1145, Nasdaq Adv/Dec 1469/1441

[ozymandius]

72. more blather - dollar hits the skids

1:25PM: The major averages stand relatively still and continue to hover around the flat line. While the stock market quickly recovered from the impact of a disappointing ISM Index report, the dollar has not managed to fare as well. Versus the euro, the greenback heads towards its biggest two-day decline after today's gauge of manufacturing activity exacerbated the slowdown concern that was piqued by yesterday's Chicago PMI data. In addition, the dollar has fallen against the yen, and, not long ago, was down against 15 of the world's 16 most active currencies. NYSE Adv/Dec 1906/1253, Nasdaq Adv/Dec 1443/1501

[Tace]

76. If You Subscribe To The Theory That The Last 15 Minutes Of The Session...

points to the direction of tomorrow's open... then tomorrow looks to open down.

[ozymandius]

77. closing numbers

Dow 10,459.63 -21.97 (-0.21%)
Nasdaq 2,147.90 -4.19 (-0.19%)
S&P 500 1,221.59 +1.26 (+0.10%)
10-Yr Bond 40.19 -0.01 (-0.02%)
NYSE Volume 2,188,265,000
Nasdaq Volume 1,613,878,000

blather to come...

[54anickel]

78. All I can say is unreal. Talk about a complacent market - they really

do think nothing will bring this market down. They'll just keep playing musical chairs from sector to sector.

[UpInArms]

79. looks like the dollar sector fell off that cliff

Last trade 86.58 Change -1.03 (-1.18%)

Settle 86.55 Settle Time 16:36

Open 87.64 Previous Close 87.58

High 87.68 Low 86.37

Last tick: 2005-09-01 16:48:40 ET
30-min delayed quote.

[54anickel]

80. But just think, that low buck will make those repatriated profits look

like a bundle.

Yep, we're all gonna be rich I tell ya!!!

[UpInArms]

81. and we will be left to rearrange

the deck chairs on the RMS Titanic

[UpInArms]

82. blather

Close: The market closed in mixed fashion, with the Dow and the Nasdaq on negative turf and the S&P just above the flat line. Morning losses, incurred via digestion of a lower than expected ISM Index report (53.6 vs 57.0 consensus), were largely pared as the stock market found support in the drop in long-term rates. The 10-year note, which dipped below 4.00% at one point, ended the day at 4.027%. It may well have been the action in the 2-year, though, that served as the strongest source of support as it can be seen at the front of the Treasury curve - the most sensitive to fed funds rate moves - that the market is pricing out the probability of three Fed tightenings through year-end. To that end, President Bush and Fed Chairman Greenspan met today to discuss the economic impact of Katrina. That meeting fueled speculation that the Fed will be re-thinking its inclination to raise rates in the face of rising energy prices and Katrina's destructive footprint along the Gulf Coast. All things considered, trading in crude futures was relatively calm today. As such, the lack of a trading spark from that area, coupled with a wait-and-see attitude ahead of the August employment report, kept bulls and bears alike fairly close to the sidelines throughout the afternoon. Crude's relatively stable session, however, did not diminish buying interest in the energy sector (+2.69%), which again led all sector comers and outperformed the broader market. Energy received an added pop after Lehman Brothers upgraded several refiners. Energy wasn't alone today, as investors continued to favor utilities (+1.38%) for its defensive attributes; meanwhile, gains in diversified metals, steel, gold, and aluminum gave the materials sector (+0.35%) a boost. The financial sector (+0.31) also lent a measure of support as the steepening yield curve fostered some renewed buying interest. As for the laggards, consumer discretionary (-0.98%) proved the worst, being bogged down again by an underperforming retail group. The morning wires included a plethora of August same store sales reports, and the overall uninspiring performance of retailers across the board. Home improvement retailers did, however, serve as a bright spot within the red sector, helped by Katrina-induced gains in Home Depot (HD 40.62 +0.01) and Lowe's (LOW 64.66 +0.35). The tech sector's (-0.45%) underperformance served as a separate drag today, as the influential sector lacked leadership and faced downgrades of its semiconductor and semiconductor equipment groups...NYSE Adv/Dec 2001/1275, Nasdaq Adv/Dec 1527/1507