STOCK MARKET WATCH, Monday 26 September

[ozymandius]

Monday September 26, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 117 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 280 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 344 DAYS
DAYS SINCE ENRON COLLAPSE = 1401
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 September 23, 2005

Dow... 10,419.59 -2.46 (-0.02%)
Nasdaq... 2,116.84 +6.06 (+0.29%)
S&P 500... 1,215.29 +0.67 (+0.06%)
10-Yr Bond... 4.25% +0.07 (+1.72%)
Gold future... 467.20 -3.10 (-0.66%)

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

[truthisfreedom]

1. love the editorial cartoon.

excellent.

[ozymandius]

3. Tom Toles is top shelf ain't he? n/t

[ozymandius]

2. WrapUp by Tim W. Wood

THE DOW REPORT
Beating the Odds

In the June 10, 2005 Wrap Up I explained that gold was “Poised to Rally” into at least an intermediate term advance. I said that this rally would be a “very very important test for gold” and that the rally would tell us without a doubt if gold was still in a secular bull market or if it had turned the corner and now operated in a secular bear market. As this rally materialized, gold bettered the December 2004 high and in doing so, it set a new record for 9-year cycle advances. In this wrap up I want to review the statistics surrounding all previous 9-year cycle advances and look at the possible meaning of such advance.

When we talk about cycles, all we are really talking about is a way of looking at the various trends of various degrees within a given market. There are long, intermediate and short-term cycles that are used to quantify the price movements of each of these corresponding trends. It is these quantifications that provide us with expectations of the current cycle or trend.

-cut-

As everyone knows, gold made a major bottom in 2001. This is where the most recent secular bull gold market was born. From a cyclical perspective, this was a 9-year cycle low. When this intermediate term cycle is moving up in conjunction with the advancing 9-year cycle it produces very powerful rallies. Then when this intermediate term cycle turns down against the 9-year cycle, it creates a counter trend downward move. This downside movement serves to correct the previous advance and then the market moves on. Of course, the opposite is true when the 9-year cycle is moving down. I have marked the 9-year and intermediate term cycle lows on the monthly gold chart below. These intermediate term lows are marked with an “S” and the 9-year lows are marked with a “9.”



But, there is always a first time for everything and last year was the first time in history for gold to advance for 5 consecutive intermediate term cycles. I believe that this was as a direct result of Greenie’s liquidity pump. So, yes, obviously gold was influenced by this re-inflation effort, but the ebb and flow of the intermediate term cycle still occurred. In the process, gold was pushed up into a never before seen 5 consecutively higher intermediate term advance within the context of the larger advancing 9-year cycle. Thus far, this unprecedented 5th intermediate term advance topped out in December 2004 at 458.70. From that top gold has been moving down as this intermediate term cycle has been moving down.

more...

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

[UpInArms]

33. Gold prices fall to a more than one-week low

http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid=%7B40245860-2702-4D8D-8387-3ACD0A26AF14%7D&

SAN FRANCISCO (MarketWatch) -- Gold futures headed lower Monday morning on the heels of two sessions of declines to trade at a more than one-week low. "With only minimum damage from Hurricane Rita to U.S. energy facilities, declining oil prices and a stronger dollar will facilitate more profit taking in the gold market," said Nell Sloane, an analyst at NSFutures.com. December gold is down $3.50 at $463.70 an ounce in New York.

[54anickel]

47. Look at that big pull down showing up on the charts to under $300

on Thursday (5 day or longer charts). Must be a problem with the charts at INO :shrug:

Seems to be recovering quite well for the day, even with the buck climbing earlier (headed down again now)

Last trade 463.9 Change +3.8 (+0.83%)

Open 460.1 Previous Close 460.1

High 464.1 Low 458.6

Bid 463.9 Ask 464.4




Last trade 89.35 Change +0.14 (+0.16%)

Settle 89.21 Settle Time 23:34

Open 89.25 Previous Close 89.21

High 89.46 Low 89.17

[UpInArms]

50. Gold turns higher - $467.80 oz

12:01pm 09/26/05 DEC GOLD TURNS HIGHER, TAKING ITS CUE FROM CRUDE PRICES

12:01pm 09/26/05 DEC GOLD UP 60C TO $467.80 AFTER TRADING AS LOW AS $462.30

[54anickel]

52. Is crude headed back up?...n/t

[54anickel]

79. Oil Prices Up As Markets Assess Rita Damage

http://abcnews.go.com/Business/wireStory?id=1160261

NEW YORK Sep 26, 2005 — Crude oil prices edged up in jittery trading Monday, as the oil industry assessed the damage caused by Hurricane Rita over the weekend.

Gasoline futures were lower, as Rita gave a glancing blow to crucial oil refineries in Texas. But with the Gulf region still recovering from Hurricane Katrina, consumers shouldn't expect prices at the pump to fall to pre-Katrina levels anytime soon.

"Most areas of the country will see price increases in gasoline this week," said Tom Kloza, analyst at Oil Price Information Service in Wall, N.J. The average U.S. retail price of a gallon of unleaded gasoline was $2.80 on Monday, up from $2.75 Sunday, but below the all-time high of $3.06 on Sept. 5.

The average price a month ago, a few days before Katrina hit, was $2.60.

"This is a tale of two markets. In the futures market, prices are down, but in the physical market, prices are still very high," Kloza said, noting that refiners are willing to pay top dollar to stay stocked.

more...

[UpInArms]

88. Oil atop $65; Gulf output still offline

http://www.marketwatch.com/news/story.asp?guid=%7B2CE5E034%2D0282%2D4B31%2DB449%2D0EB20315B493%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Crude-oil futures closed nearly 3% higher Monday, rebounding from a seven-week low with 100% of daily oil output in the Gulf still offline and traders wary of incoming damage reports from Hurricane Rita.

More than 1.5 million barrels of daily oil production in the Gulf of Mexico is shut in as a result of Hurricanes Katrina and Rita, the U.S. Minerals Management Service reported Monday -- that's all of the region's daily output.

More than 78%, or 7.8 billion cubic feet, of daily natural-gas production remained offline as well, the MMS said.

"Nobody seems to have noticed that there has been virtually no recovery in Gulf of Mexico production in the area damaged by Katrina for either oil or natural gas," said James Williams, an economist at WTRG Economics.

"Rita will have caused additional damage and added to the problems of an already strained support infrastructure," Williams said.

...more...

[UpInArms]

73. Gold prices close $2 higher ($469.50); copper taps another record

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.5769315625-843805795&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- December gold climbed $2.30 to close at $469.50 an ounce in New York, as fresh strength in crude fueled more inflation concerns. At the same time, December copper added 3.8 cents, or 2.2%, to end at $1.7365 a pound after trading at a record $1.74. Bloomberg News reported Monday that China, the world's largest consumer of the metal, boosted its copper imports by 64% in August. Metals indexes mirrored the metals' strength, with the Amex Gold Bugs Index (HUI) up 3.2%.

[54anickel]

77. Beware the fall, goldbugs

http://www.theglobeandmail.com/servlet/story/RTGAM.20050926.wgoldmon0926/BNStory/Business/

snip>

According to Merrill Lynch & Co. Inc., bullion prices over the last fifteen years have followed a “very strong” seasonal pattern from early summer to early fall: strengthening through the late summer period as fabricators replenish inventories ahead of the autumn season.

“Since seven of the past eight rallies have peaked (and ended) in late September/early October, we surmise that the seasonal rally may have little life left to it,” Merrill analyst Michael Jalonen wrote in a Monday report.

Gold prices — and gold stocks — started to rally this summer. Since July 19, the price of gold and the S&P/TSX gold index have risen 12.2 per cent and 17.4 per cent, respectively, the report said, while the Philadelphia Gold & Silver index has shot up 23.5 per cent.

snip>

The fact that hurricane Rita did not inflict harsher damage on Texas and Louisiana over the weekend sparked a further selloff in gold on Monday, with futures for December delivery sliding $3.10 to $464.10 an ounce on the New York Mercantile Exchange.

“Bullion could encounter weakness in the near term due to the expected resumption of sales by the European Central Bank after September 27,” Merrill said. After the regular seasonal rally, gold has traditionally fallen by 6.3 per cent over the course of 33 business days.

more...

[ozymandius]

4. NY Mercantile Exchange holds rare Sunday session

NY Mercantile Exchange holds rare Sunday session, relieved Rita wasn't worse

TORONTO (CP) - Investors can breathe a sigh of relief as trading gets under way this week that damage to U.S. Gulf Coast oil production and refining facilities was less than feared.

That sentiment was expressed in a rare Sunday trading session on the New York Mercantile Exchange, where the price of crude fell sharply.

The November contract for light sweet crude closed down $1.23 to $64.19 US a barrel Sunday as it appeared the Texas oil and gas industry sustained what Gov. Rick Perry called "a glancing blow."

The October contract for unleaded gasoline on the Nymex closed down 10.55 cents US to $1.982 per US gallon.

more

[UpInArms]

15. BHP Billiton, Chevron's Typhoon platform saw severe damage

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.3714041667-843782233&siteID=mktw&scid=0&doctype=806&

LONDON (MarketWatch) -- BHP Billiton (BHP) (UK:BLT) said the Typhoon tension leg platform that's 165 miles south/southwest of New Orleans was severed from its mooring and suffered severe damage during Hurricane Rita. BHP and Chevron (CVX) each own 50% of the platform, and the facility is now being secured. For the year ended June 2005, BHP's share of production was 4.3 million barrels of oil and 7.1 billion cubic feet of natural gas through the Typhoon facility.

[spotbird]

20. It's always nice to hear both sides

one is bound to be true.

[UpInArms]

23. Rowan says 2 rigs not at pre-Rita locations; 1 aground

9:47am 09/26/05 ROWAN COS.: 3 RIGS ACCOUNT FOR $210K REVENUE DAILY

9:47am 09/26/05 ROWAN COS.: 3 RIGS INSURED FOR MORE THAN CARRYING VALUE

9:48am 09/26/05 ROWAN COS. IS NOT INSURED AGAINST LOSS OF REVENUE

9:46am 09/26/05 ROWAN COS.: ANOTHER RIG IS AGROUND OFFSHORE LOUISIANA

9:47am 09/26/05 ROWAN COS. TO ASSESS OTHER GULF OF MEXICO RIGS

=Rowan says 2 rigs not at pre-Rita locations; 1 aground

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.4168873495-843787105&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) -- Rowan Cos., (RDC) the Houston oil-services provider, said that after Hurricane Rita, its jackup rigs Rowan-Odessa and Rowan-Halifax were not at their pre-storm locations. In addition, the hull of the Rowan-Louisiana apparently detached from its legs and is aground offshore Louisiana. Rowan also could not account for the Rowan-Fort Worth rig. All other Gulf of Mexico rigs were identified and the company said it would assess their condition as weather permits. The Rowan-Odessa, Rowan-Halifax and Rowan-Louisiana were operating under contracts that provided revenue of $210,000 daily. The rigs are insured for more than their carrying value. Rowan said it does not maintain insurance against loss of revenue.

[UpInArms]

24. Rita causes "extensive damage" to Entergy transmission grid

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.4144986111-843786892&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Entergy Corp. (ETR) said Monday it's transmission system sustained "extensive damage" in areas hit by Hurricane Rita over the weekend. Preliminary damage assessments show 279 lines and 284 substations out of service following the storm, the utility said. Entergy reported that at 5 a.m. on Monday more than 485,000 homes and businesses were without power. Power has been restored to an additional 281,000. Entergy said customer outages peaked at more than 766,000.

[UpInArms]

28. Some 1.3 million still without power in US after Rita

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T140642Z_01_N26426231_RTRIDST_0_RITA-POWEROUTAGES.XML

NEW YORK, Sept 26 (Reuters) - Over 1.3 million customers were without power in Texas and Louisiana, including new outages from this weekend's Hurricane Rita and remaining outages from Hurricane Katrina, according to utilities in the area and the U.S. Energy Information Administration.

Before Rita hit the Gulf Coast as a Category 3 storm on Sept. 24, about 250,000 customers were still without service in Louisiana almost four weeks after Katrina ravaged the southeastern corner of the state and flooded New Orleans.

Entergy Corp. (ETR.N: Quote, Profile, Research), the biggest power company in Louisiana, said more than 485,000 customers in Texas, Louisiana, Arkansas and Mississippi were without power due to Hurricane Rita, down from a peak of more than 766,000 during the storm.

Entergy pointed out, however, it was not counting more than 156,000 customers still without service in the New Orleans area because those customers' homes and businesses were unable to accept service due to significant repair or reconstruction requirements following Katrina.

...more...

[UpInArms]

41. Sunoco Logistics: 10 Nederland (Texas) storage tanks damaged

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.4648914699-843792464&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Sunoco Logistics Partners L.P. (SXL) said Monday that ten storage tanks at its Nederland, Texas, crude oil facility have suffered some structural damage from Hurricane Rita, with varying impacts on capacity. There was also moderate damage to some building facilities, non-critical flooding and commercial power is currently unavailable. Until all assessments are completed and power is restored, the company said it doesn't know when the terminal will resume operations.

[UpInArms]

63. Swift Energy: 55%-60% of production shut-in due to Rita

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.5601019329-843803501&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Swift Energy Co. (SFY) said Monday that 55% to 60% of its total production remains shut-in following Hurricane Rita. The Houston-based oil and gas company said inspections of its properties in Louisiana and Texas have been hampered due to hurricane damage, as well as communications and logistics problems.

[UpInArms]

32. Crude fall under $64 after tapping a 7-week low overnight

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.4362196065-843789276&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Crude-oil futures fell under $64 a barrel after briefly touching a seven-week low overnight as damage reports from Hurricane Rita so far proved less worrisome than expected. Crude for November delivery fell 74 cents at $63.45 a barrel in New York. During a special trading session that began Sunday, crude reached as low as $62.65 a barrel, the contract's lowest level in seven weeks. Other energy futures followed suit Monday. October unleaded dipped to $2.01 a gallon, down 7.56 cents and October heating oil lost 0.65 cent to $1.9425 a gallon. October natural gas dropped 51.4 cents to $11.81 per million British thermal units after an over one-week low of $11.75. Rita "spared Gulf of Mexico energy assets the worst," said John Kilduff, an analyst at Fimat USA.

[ozymandius]

5. Rita, No Katrina, May Boost U.S. Stocks

NEW YORK - To say Hurricane Rita wasn't "that bad" obviously minimizes the loss of life and immense damage suffered along the Texas and Louisiana coasts. But from the stock market's point of view, Rita was no Katrina. And that may bode well this week for Wall Street.

That's not to say that all is well and Wall Street is ready to surge forward. The devastation wrought by Katrina and, to a lesser extent, Rita will hurt the economy in the months ahead. There's the concern that high gasoline and heating oil prices will weigh heavily on consumers, which could impact overall spending as the holidays approach.

There's also the concern that high energy prices will pressure businesses to pass along their costs to consumers, sparking inflation.

However, these are long-term concerns. As long as the news from Texas and Louisiana stays relatively positive by Wall Street's standards, the week could start off well. Oil prices dropped significantly in rare electronic trading on Sunday, and as more refineries restart, stocks are likely to move higher.

more

[UpInArms]

6. daily dollar watch

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

Last trade 89.35 Change +0.14 (+0.16%)

Rita Relief Rally

http://www.dailyfx.com/index.php?option=com_content&task=view&id=3722&Itemid=39

"It is important to maintain a sense of the overall spending commitment as we work together to rebuild the devastated communities of the Gulf Coast."

Judd Gregg,
Senate Budget Committee Chairman
Tuesday, September 20, 2005 09:09 GMT

Rita Relief Rally


Rita wasn’t nearly as bad as feared and by Friday afternoon, with oil markets staging a retreat, the greenback rally began in earnest as EUR/USD bids first broke 1.2150 then 1.2100 and came close to testing the psychologically important 1.20 level. For the week the dollar gained 157 basis points against the euro buoyed mostly by the its increasing interest rate differential which expanded to 175 basis points after the Fed hike on Tuesday.

Rates and growth appear to be the key themes as we move into the fall trading season. As long as US maintains its 3% economic growth, Fed hikes are likely to continue which will fuel even more dollar buying from carry speculators. That premise will be sorely tested however as we move into next week. Traders will watch Durable Goods numbers projected to rebound 1% from last month’s 4.9% plunge as well the critical Chicago PMI report on Friday. Last month Chicago PMI showed the largest drop in the survey’ s history falling below the critical 50 boom/bust level. If the Chicago PMI numbers climb back above the expansionary threshold, the just as with Rita US economic data may have escaped a far gloomier fate.

...more...

[spotbird]

19. Translated:

It's important that the rate of excessive spending be maintained so that the beast will be starved by the spring.

[54anickel]

42. Couple of articles regarding the borrow or cut spending argument

Borrowing Trouble (from China) in Katrina's Wake

http://www.npr.org/templates/story/story.php?storyId=4855367

If you think the costs of war in Iraq and recovery from Hurricane Katrina will force President Bush to raise taxes, think again. No matter how high the price may go for rebuilding the Gulf Coast while staying the course in the Persian Gulf, this White House will not choose the revenue option.

If you think the Congress is going to cut enough spending to offset Katrina's costs, think again. Nothing in memory suggests our lawmakers will risk the ire of their constituencies with the massive rescissions that would be required.

That leaves one way to meet the new obligations of disaster relief while sustaining the rest of Uncle Sam's commitments, foreign and domestic. It is the path of least resistance, the well-worn path to the international credit markets. No sooner had the Congress approved more than $60 billion in hurricane relief than the Treasury Department readied a new issue of 30-year bonds.

So we will borrow what we need to rebuild Louisiana and her neighbors. The future beneficiaries of that policy will be our creditors, including China and her neighbors. Right now, they like investing in America by owning our debt. And in the long run, creditor nations tend to rise as debtor nations decline.

snip to the puker line from Delay>

How hard is it to cut spending in the 109th Congress? No less a conservative than Tom DeLay, the House Majority Leader, now says that after 11 years of Republican majority in his chamber, there's just not much fat left to cut.

more...


Deficit disaster looms
Reconstruction spending diverts attention from crisis

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2005/09/25/BUGFRES7LA98.DTL&type=business

Even before Hurricane Rita struck the Gulf Coast, the cost of providing for relief and reconstruction in the aftermath of Hurricane Katrina was swelling an already bloated federal budget deficit.

The cost to the federal government of responding to Katrina is estimated at $62 billion and growing. Yet, even if Rita requires another huge outlay, experts say the disasters are unlikely in and of themselves to have much of a long-lasting effect on either the U.S. economy or the nation's fiscal outlook.

Instead, budget watchers of many political hues worry that the attention of lawmakers will be so diverted by their efforts to take care of hurricane survivors that they will forget about the Category 5 crisis that threatens to clobber the budget in about a dozen years, when retiring Baby Boomers start collecting Medicare and Social Security.

Fiscal prudence, many fear, could become the ultimate hurricane casualty.

snip to about that "no fat" comment by Delay>

He said the hurricane relief effort should be made an object lesson in fiscal discipline, suggesting that lawmakers start to pay for the relief package by rescinding $24 billion in spending on some 6,000 construction projects in every congressional district that were included in the $286.4 billion transportation bill passed in July.

Fraser, the Heritage Foundation economist, urged the same step and praised House Minority Leader Nancy Pelosi, a liberal California Democrat, for offering to give back $70 million of the $129 million in highway funds earmarked for San Francisco to help pay for Katrina relief.

more...

[UpInArms]

64. dollar not holding onto gains

Last trade 89.19 Change -0.02 (-0.02%)

Settle 89.21 Settle Time 23:34

Open 89.25 Previous Close 89.21

High 89.46 Low 89.14

Last tick: 2005-09-26 12:59:13 ET
30-min delayed quote.

[UpInArms]

66. Dollar turns lower; tone becomes cautious on oil

http://today.reuters.com/investing/FinanceArticle.aspx?type=economicNews&storyID=URI:urn:newsml:reuters.com:20050926:MTFH59107_2005-09-26_16-57-23_N26111177:1

NEW YORK, Sept 26 (Reuters) - The dollar slipped from two-month highs against the euro on Monday, with currency investors turning cautious while they awaited a more detailed assessment of the damage Hurricane Rita inflicted on U.S. oil facilities and crude oil prices rose.

In addition, market talk of central bank buying of euros above the $1.2000 zone boosted the euro, some traders said.

"People are still waiting for a better assessment as to the conditions of some of these oil pipelines and rigs," in the wake of Hurricane Rita, said Hugh Walsh, vice president of foreign exchange at Fortis Bank in New York.

Crude oil prices rebounded above $64 per barrel in New York, after slipping earlier to around $63.

...more...

[54anickel]

72. Central Banks Get High on the Dollar

http://www.321gold.com/editorials/mauldin/mauldin092405.html

snip>

Central Banks Get High on the Dollar

But first, there are those dollar bears who just keep wondering when will the dollar crash? The answer, of course, is when people stop buying it. Fairly straight-forward proposition. And we have long known that central banks have been major buyers of the dollar. But last year, rumors began to circulate that central banks were diversifying away from the dollar, especially as the dollar began to drop. But then it has come back. What happened? It looks like the rumors of foreign central banks buying fewer dollars were just that - rumors. I got both these notes today from independent sources. Comments come after these quotations. First, Dennis Gartman brings us this note:

"Turning to another concern, the IMF has just issued a report proving that the position that the dollar bears have staked out that the world's central banks have been diversifying away from the US dollar was and is false. They may have been doing so back in '04, but they've clearly not been doing so this year. Our friend, Mr. Stephen Jen, of Morgan Stanley, who heads up that firms foreign exchange analytical group, wrote yesterday that 'Bottom line: IMF reports no USD diversification, but EUR diversification Contrary to an overwhelming consensus view in late-2004 that central banks were diversifying wholesale from USD assets, the latest report from the IMF points to exactly the opposite: the share of USD assets in total reserve holdings increased in both nominal and real terms, while there were signs of diversification from EURs in relative terms.

" 'Central bank diversification was the dominant theme in late-2004 This was the single-most powerful theme in the currency markets in late-2004, and propelled EUR/USD into deep overshoot territory by December 2004. We strongly contested this consensus view, and argued strongly, in a note issued in February 2005, the USD share may have actually risen in 2004. The latest report on the currency composition of official reserves from the IMF validates our prediction.'"

Begs the question, can you trust the IMF?

more...

[54anickel]

80. The Fed

http://www.kitco.com/weekly/paulvaneeden/sep232005.html

snip>

So the Fed is worried about inflation. But which inflation? Are they worried about the increase in the money supply or are they worried that higher gasoline prices will ultimately lead to higher consumer prices? Remember, inflation is an increase in money supply that can lead to an increase in prices. An increase in prices is, by itself, not inflation. So if the gasoline price rises because a hurricane shuts down production that is not inflation. Similarly, if the price of oil goes up because the US dollar fell on foreign exchange markets, it is not inflation.

Surely the Fed has to be concerned that its policy of raising interest rates could hurt the US economy by deflating the real estate bubble and slowing economic growth. In fact, the abuse of leverage in the US real estate market and the extent to which consumers, corporations, and the government itself, are indebted should raise the risk of a deflationary collapse if interest rates keep rising. Especially if long-term interest rates start rising as well, which it appears they may have started doing. So how can the
Fed justify its policy of increasing interest rates?

According to the Fed its policy is to raise interest rates to a neutral position -- the interest rate at which economic growth is neither promoted nor hindered. Currently, the Fed believes that interest rates are still promoting economic growth, in other words, interest rates are too low. How does the Fed know what interest rate is optimal? It doesn’t. The Fed doesn’t even know what money is! Alan Greenspan admitted that crafting monetary policy is problematic because the Federal Reserve does not know how to define money or how to measure it. If the Fed cannot even define, never mind measure, what money is, how can it possibly be so sure that it knows the optimal interest rate at which the economy is neither hindered nor stimulated?

I suspect that the Federal Reserve Board Governors know they have a problem. Could it be that they are worried about something much larger than the devastation caused by Katrina, the impact of higher gasoline prices on consumer spending or a slowdown in real estate spending due to higher interest rates?

The US consumption binge, from stocks, bonds and real estate to the money we spend in our malls on credit cards, is being financed by foreign capital. Cut off the influx of foreign capital and you basically switch off the life support of a terminally ill US economy. Sustaining foreign appetite for US financial products is arguably far more important than anything else affecting the US economy at the moment.

more...

[UpInArms]

7. Today's Report:

http://biz.yahoo.com/c/ec/200539.html

Sep 26	10:00 AM	Existing Home Sales	Aug	-	NA	7.10M	7.16M	-

[UpInArms]

25. Homes Sales Report in:

10:00am 09/26/05 U.S. AUG. EXISTING HOME SALES UP 2% TO 7.29 MLN

10:01am 09/26/05 U.S. AUG. EXISTING HOME SALES ABOVE CONSENSUS OF 7.11 MLN

10:01am 09/26/05 U.S. AUG. EXISTING HOME SALES SECOND HIGHEST RATE ON RECORD

U.S. Aug. existing homes sales rise 2% to 7.29 mln

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.4232242477-843787872&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Sales of previously-owned homes rose 2% in August to a seasonally-adjusted annual rate of 7.29 million units, the National Association of Realtors said Monday. Sales in July were revised down to 7.15 million from 7.16 million reported earlier. August sales were up 7.8% from August 2004 and were the second highest on record. The median home sales price rose 15.8% over a year ago to $220,000. Inventories of homes for sale rose 3.5% in August to 2.86 million, a 4.7 month supply and the most plentiful month's supply since November, 2003. David Lereah, NAR's chief economist, said, "Katrina has disrupted everything for us," and it may be several months before realtors will know the full impact of Katrina on the housing market.

[UpInArms]

8. Time to decide who should steer world economy

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=reutersEdge&storyID=uri:2005-09-25T000850Z_01_KWA500412_RTRUKOC_0_US-GROUP-GOVERNANCE.xml

The thorny issue of who or what should steer the $41-trillion global economy -- now more integrated and interdependent than ever before -- came into focus at weekend meetings of the world's finance chiefs.

After years of semi-paralysis, proposals to revamp the Group of Seven club of rich nations and the G7-controlled International Monetary Fund are at last crystallizing.

Policy-makers continually wring their hands about the risks to world growth from acute imbalances in trade and investment accounts, and most now accept there are severe limitations to existing structures in dealing with the problem.

The G7 coalition, which for decades has acted as the world economy's de facto governing council, has become too narrow to reflect dramatic changes to world power following a decade of breakneck globalization.

What is more, a perceived illegitimacy of the G7 in running the world economy means its dominant share of votes in steering the policies of the 184-member IMF undermines the credibility of that financial firefighter too.

...more...

[54anickel]

29. Morning UIA, Ozy and all. Did you catch this one over the weekend?

I thought for sure we'd see a good dip in the buck on this one, but noooooo, it's chugging right along arrogantly making the statement "deficits don't matter". Who the hell is buying the damned thing? I still say it reeks of intervention.

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=102&topic_id=1804040

Breton: Greenspan worried about deficit
French finance minister says both men are disappointed over how countries manage their budgets.

http://money.cnn.com/2005/09/24/news/international/greenspan_france.reut/index.htm

WASHINGTON (Reuters) - Federal Reserve Chairman Alan Greenspan told France's Finance Minister Thierry Breton the United States has "lost control" of its budget deficit, the French minister said Saturday.

"'We have lost control,' that was his expression," Breton told reporters after a bilateral meeting with Greenspan.

"The United States has lost control of their budget at a time when racking up deficits has been authorized without any control (from Congress)," Breton said.

"We were both disappointed that the management of debt is not a political priority today," he added.

Ministers from the Group of Seven rich nations on Friday called for vigorous action around the world to curb rising imbalances in international trade and investment accounts.

more...

[ozymandius]

35. I caught that.

Of course, this would only se ethe light of day when people are distracted by Rita and its impact on the price of fuel.

So the has-been partisan hack frets over massive deficits, eh? Why the bloody hell didn't he say something before whoring himself in support of Bush's massive tax cuts?

[54anickel]

45. Greenspan to French finmin: US lost deficit control

Made it to Reuters and Yahoo now....pretty much the same story as posted. Forex still has it's head in the sand.


http://news.yahoo.com/s/nm/20050925/bs_nm/group_france_greenspan_dc;_ylt=AnYEy2HMG4eDahR.vEx9N23v5rEF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl

snip>

Breton said: "The situation that is creating tension today on the currency market ... is clearly the American deficit."

The United States needed to address its budget deficit, he said, adding: "It seems to me that my counterpart John Snow is completely aware of this, he wants to harness the problem, but it seems to me he doesn't have the room for maneuver."

Breton added that after hearing Greenspan talk about inflation: "One has the feeling -- though he didn't say so -- that interest rates will probably continue to rise slightly until his departure."

[54anickel]

53. American fury over Greenspan leak (Whoopsie!)

French claim Fed chairman admits US has lost control of budget
Russia receives G7 snub

http://news.independent.co.uk/business/news/article315144.ece

Bitter disagreements over global economic policy broke out into the open yesterday as the French Finance Minister claimed that Alan Greenspan had admitted America had "lost control" of its budget while China warned the US to drop demands for radical economic policy changes.

snip>

The public comments, which were made during meetings between the G8 nations and the International Monetary Fund, are certain to anger the Bush administration and widen divisions between the US and France over issues such as the Iraq war and global warming.

A clearly irritated senior US Treasury source said: "Things can get lost in translation."

A spokesman for the US Treasury said: "This administration is absolutely committed to the President's goal of halving the deficit as a percentage of GNP by 2009 and we have every expectation of meeting that goal."

Meanwhile, Zhou Xiaochuan, the governor of China's central bank, said it would not be pressured into suddenly abandoning its currency regime.

snip>

In an apparent snub to Russia, the G7 said it would hold an extraordinary finance ministers' meeting in London in December rather than one in February, during the Russian chairmanship of the G8.

more...

[54anickel]

54. delete - dupe

[54anickel]

55. delete - another dupe - not sure if it was my system or DU that hiccuped

[54anickel]

37. Interesting little battle shaping up there - seems the US still considers

the euro the most immediate threat. Wonder if the US push for higher Asian representation is so they can put a lid on the movement toward the ASEAN trading/currency block as well. Rein in the EU and at the same time have more control over what's happening in Asia....JMHO - :shrug:

snip>

The U.S. is reluctant to yield any of its voting power and the focus centers on consolidating European Union votes into one seat to make room for a higher Asian representation.

Either way, the changes to both G7 and IMF are likely to come hand in hand and will be critical for any credible agreement on steps toward more Asian currency flexibility, U.S. budget discipline and structural reforms in Europe and Japan.

Japanese officials on Saturday threw cold water on the idea of an imminent G7 expansion but, for many economists, the change cannot come soon enough.

snip>

G7 said on Friday it had scheduled an extraordinary meeting for December in Britain -- a move largely unexplained by ministers but which is likely to have been related to avoiding a February gathering in Russia.

[54anickel]

38. Who's Blaming Whom? (Roach)

http://www.morganstanley.com/GEFdata/digests/20050923-fri.html#anchor0

An unbalanced world is getting caught up in the blame game. As the IMF and World Bank gather in Washington this weekend for their annual meeting, the risk of finger pointing is high. There are two sides to this increasingly contentious dispute: The United States is pinning the blame for its massive trade and current account deficits on the rest of the world -- bemoaning sluggish growth in Europe and Japan, along with unfair trading practices in China. The rest of the world holds the saving-short US accountable for a disproportionate share of the global economy’s unprecedented imbalances. Where should the blame be placed?

Context is key in framing the answer to this question. In 2005, our estimates suggest that the US will account for fully 70% of all the current account deficits in the world economy (see my 16 September dispatch, Asymmetrical Risks of Global Rebalancing). That’s more than double America’s 28% share in world GDP as measured at market exchange rates and more than three times the US weight of 21% as gauged by the IMF’s purchasing-power parity metrics. By contrast, Japan’s surplus -- the world’s biggest -- accounts for only 17% of all the current account surpluses in the world. In fact, it takes ten economies -- Japan, Germany, Russia, Saudi Arabia, China, Norway, Switzerland, Canada, Singapore, and the Netherlands -- to make up the same 70% share on the surplus side of the equation that America accounts for on the deficit side. In my view, there can be no mistaking the highly disproportionate share that America plays in fostering overall imbalances in the global economy.

But that still begs the key question of blame. Many continue to view America’s outsize deficits as simply a by-product of chronic growth and return deficiencies elsewhere in the world. That’s pretty much the party line in Washington these days. US politicians and policy makers argue that America is doing the world a huge favor by playing the role as both a powerful engine of growth as well as a magnet for returned-starved capital. This has prompted Washington’s (and Wall Street’s) triumphalist explanation of global imbalances -- that the US capital account surplus is effectively driving the current account deficit. The other side of the debate is the tale of a saving-short US economy. With America’s net national saving rate hovering at a record low of 1.5% of GDP since early 2002 -- and likely to get considerably worse over the next 12-18 months -- the United States is putting enormous pressure on the rest of the world to fund its economic growth.

snip>

For financial markets, the implications are profound: The longer the world continues to play the blame game, the more the imbalances will build, and the greater the likelihood of a hard landing for the global economy and world financial markets. America’s failure to own up to its major role in fostering global imbalances is especially disturbing. By refusing to address its ever-mounting imbalances, the US flirts increasingly with a classic current account adjustment. That underscores downside risks to the US dollar and upside risks to real US interest rates. America’s lack of leadership in resolving global imbalances is hardly commensurate with its dominant position in the world economy.

[UpInArms]

9. Questions over Hurricane Katrina contracts - paper

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T091753Z_01_N2643545_RTRIDST_0_KATRINA-BIDS.XML

NEW YORK, Sept 26 (Reuters) - More than 80 percent of the $1.5 billion in contracts signed by the Federal Emergency Management Agency to clean up after Hurricane Katrina were awarded without bidding or with limited competition, the New York Times reported on Monday.

The newspaper, citing government records, said some of the bids are provoking concern among auditors and government officials about the potential for favoritism or abuse.

The first detailed tally of commitments from federal agencies since Hurricane Katrina hit the Gulf Coast four weeks ago shows more than 15 contracts exceed $100 million, including five of $500 million or more. Most were for clearing trees, homes and cars strewn across the region; purchasing mobile homes; or providing trucks, ships, buses and planes.

Already, the Times said, questions have been raised about the political connections of two contractors -- the Shaw Group (SGR.N: Quote, Profile, Research) and Kellogg, Brown & Root, a subsidiary of Halliburton (HAL.N: Quote, Profile, Research) that have been represented by lobbyist Joe Allbaugh, President George W. Bush's ex-campaign manager and former head of FEMA.

"When you do something like this, you do increase the vulnerability for fraud, plain waste, abuse and mismanagement," the Times quoted Richard Skinner, inspector general for the Department of Homeland Security, as saying. "We are very apprehensive about what we are seeing."

...more...

[UpInArms]

10. Energy prices risk to US economy-Bernanke

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-09-25T160830Z_01_WRI549822_RTRUKOC_0_US-ECONOMY-BERNANKE.xml

WASHINGTON (Reuters) - High energy prices in the wake of Hurricanes Rita and Katrina pose a risk to U.S. economic growth, but inflation expectations remain well-contained, a top White House economic adviser said on Sunday.

"The high energy prices are certainly burdening consumer budgets, they are burdening cost structures of firms and certainly continued increases in energy prices are a risk for economic growth going forward," White House economic adviser Ben Bernanke told the Institute of International Finance annual membership meeting.

But Bernanke, who was governor of the Federal Reserve before he was named chairman of President George W. Bush's Council of Economic Advisers in June, said low inflation expectations gave the Fed more flexibility than in past energy crises.

"A very important factor is the fact that inflation expectations are well-controlled and well-contained, which means that the Federal Reserve, unlike the 70s, doesn't have to react violently in terms of raising interest rates to contain the second- and third-round inflationary impacts. So I remain pretty optimistic about the economy," Bernanke said.

...more...

[UpInArms]

11. America has become one

http://www.freep.com/features/living/riley25e_20050925.htm

Here's where we're headed economically and socially in America.

There will be two stores, a department store and a discounter -- probably Macy's and Wal-Mart -- that will compete with a million specialty stores selling each item from those stores or high-end stuff most Americans can't afford.

There will be one airline, LMS: Last Man Standing.

There will be one TV network, owned by the nation's largest corporation, with 500 partners that show reruns.

<snip>

Corporations will get naming rights to national monuments, because we, after all, will have stopped caring about history. So there will be the Enron George W. Bush Memorial and the Halliburton Dick Cheney Iraq War Memorial. Millions will visit the Burger King Thomas Jefferson Memorial. But not one person will sadly shake their head at the frivolity of it.

We can't fight the monolithic, monopolistic one-original-thought trend that we've embraced. The takeovers and consolidations will make us an imploding single entity, one nation under Macy's. But beneath that entity will be a splintering that will take us farther from each other.

...more...

[UpInArms]

12. Treasurys lose appeal as storm worry fades

http://www.marketwatch.com/news/story.asp?guid=%7BEAE392FB%2DB240%2D470C%2D937A%2D2FE5E6DF2FB4%7D&siteid=mktw

CHICAGO (MarketWatch) - Investors shunned lower-risk Treasury bonds Monday as a calm enveloped financial markets after Hurricane Rita skipped the more heavily populated areas of Texas and Louisiana that are also studded with oil refineries.

"International markets have been relieved that apparently damage from Hurricane Rita was less than feared over the weekend to the U.S. oil infrastructure in the Gulf region," said analysts at Ried Thunberg ICAP, in a morning research note.

There was relief that the storm landed east of Sabine Pass, sparing the coastal Texas cities of Galveston and Houston, in which oil and gas facilities are concentrated. See full coverage of the storm.

Treasurys had gained in anticipation of more widespread damage just a few weeks after the blow of Hurricane Katrina.

...more...

[UpInArms]

39. Check-Kiting: U.S. Treasury to sell $20 billion in 2-year notes

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T150456Z_01_WBT003926_RTRIDST_0_ECONOMY-TREASURY-NOTES-URGENT.XML

WASHINGTON, Sept 26 (Reuters) - The U.S. Treasury Department said on Monday it will sell $20 billion of two-year notes on Wednesday, Sept. 28.

The two-year notes will be issued Sept. 30 and will mature on Sept. 30, 2007. The Treasury said the proceeds would refund $24.95 billion of publicly held notes maturing Sept. 30, and to pay down about $4.95 billion in debt.

Treasury said the net long reporting threshold for the notes is $7 billion.

The CUSIP number for the notes will be 912828EH9.

Treasury said noncompetitive bids will be accepted in full up to $5 million at the highest accepted yield for the issue.

...more...

[UpInArms]

40. More Check-Kiting: US Treasury to sell $8 bln 4-week bills Tuesday

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T150047Z_01_WBT003927_RTRIDST_0_ECONOMY-BILLS-ANNOUNCEMENT-URGENT.XML

WASHINGTON, Sept 26 (Reuters) - The U.S. Treasury Department said on Monday it will sell $8 billion of four-week bills on Tuesday, Sept. 27.

The bills will be issued on Sept. 29.

Proceeds from the sale will be used to refund about $15 billion of publicly held bills maturing on Sept. 29 and to pay down approximately $7 billion of debt.

The four-week bills announced on Tuesday mature Oct. 27. Treasury said the net long position reporting threshold is $2.80 billion.

Noncompetitive bids must be received noon EDT (1600 GMT) and competitive bids by 1:00 p.m. EDT (1700 GMT).

...more...

[54anickel]

44. Check the debt clock -

http://brillig.com/debt_clock/

The Outstanding Public Debt as of 26 Sep 2005 at 03:39:41 PM GMT is:



The estimated population of the United States is 297,269,550
so each citizen's share of this debt is $26,693.10.

[Roland99]

61. Look at all of that debt being paid down.

At this rate, we'll be in the black by...oh...3108!

[UpInArms]

13. Merger boom set to thrive throughout 2006

http://today.reuters.com/investing/financeArticle.aspx?type=fundsNews2&storyID=URI:urn:newsml:reuters.com:20050926:MTFH50313_2005-09-26_10-42-23_L26712994:1

LONDON, Sept 26 (Reuters) - The current boom in mergers and acquisitions is set to extend through 2006, fuelled by low interest rates, cheap debt and cash-rich chief executives eager to expand after years of restructuring, senior bankers said on Monday.

So far this year there has been $1.97 trillion worth of deals globally, up 41 percent from a year ago, according to figures from financial data provider Dealogic.

Volumes in Europe have overtaken the United States -- traditionally the more active M&A market -- for the first time in two and half years with $281.2 billion worth of deals in the third quarter versus $190.5 billion in the United States.

At the same time, private equity firms have raised tens of billions of dollars and are aggressively competing in ever bigger deals. Hedge funds, too, are casting their nets further and wider, raising the competitive pressure.

...more...

[54anickel]

65. About that corporate confidence they mention in that article...

From Greenspan and The Rate of Interest
http://www.321gold.com/editorials/gnazzo/gnazzo092605.html

snip>

The big lie is that money and debt can be one and the same. They can't. You can not pay a promise to pay with another paper promise to pay. That is not payment. That is just rolling over the debt. Promises for more promises - to pay. Debt transference. Nothing more, and a whole lot less.

When debt is allowed to circulate as the currency - as debt-money - there is hell to be paid. The day of reckoning, the weighing in the balance, keeps getting pushed off farther into the future; but make no mistake about it, the day of atonement will come - if not by us, then by our children, and their children, which isn't the best of legacies to leave your loved ones. Leave them some gold instead.

snip>



Confidence

The above state of affairs is what has led to a bit of a falling out of confidence among CFOs in America. How do we know? Take a look at the chart below. Seems they are aware of the rising debt levels, higher costs, and the loss of 95% of our currencies purchasing power - maybe that's why they are chief financial officers:

All of which adds up to a kind of queasy feeling in the pit of one's stomach - like we're involved in some con-fi-dence game of sorts. Here you take my debt and I'll trade you it for mine. Let's rob Peter so we can make believe to pay Paul. It just doesn't work like that folks - and I don't care what they tell you - if they do - they speak with forked tongue, as the Indians can attest by the terrorist attacks they were subjected to a few hundred years ago in the land of milk and honey.

[UpInArms]

14. US Treasury official-Hedge fund rules need review

http://today.reuters.com/investing/financeArticle.aspx?type=governmentFilingsNews&storyID=URI:urn:newsml:reuters.com:20050925:MTFH39392_2005-09-25_18-53-41_N25579222:1

WASHINGTON, Sept 25 (Reuters) - U.S. Treasury Undersecretary Randall Quarles said on Sunday regulators may want to consider more comprehensive oversight of hedge funds.

"Hedge funds might be the area of regulation where there is most room for improvement in our approach," Quarles said. He was speaking on a panel on financial regulation organized by the Institute of International Finance on the sidelines of the International Monetary Fund and World Bank meetings here.

Changes in the structure of the capital aggregation industry in recent years may have altered the way markets manage and disperse risk, Quarles said.

"Is there a policy response that's appropriate in the light of that or not? That's a question that has not been comprehensively asked in the official sector, at least in the United States," he said.

Recent Securities and Exchange Commission rules requiring fund registration focus on a narrow consumer protection aspect of the loosely supervised, $1 trillion hedge fund industry, rather than a more comprehensive, systemic view, Quarles said.

...more...

[54anickel]

43. OVERGROWN HEDGES

http://www.nypost.com/business/28536.htm

snip>

But these are not normal times — and the one thing this country needs more than anything is a government that knows what it is doing and that deserves to be taken seriously by its citizens.

Nobody can possibly blame the president of the U.S. for the back-to-back hurricanes. But for Bush to make a big deal of rushing to Colorado Springs last week to "monitor" Hurricane Rita developments from the Pentagon's NORAD headquarters bunker seemed not much more than a presidential "feel your pain" stunt intended to improve his poll numbers.

Such ploys work best when the audience doesn't see the purpose behind them — and when the opposite happens it is hard to escape the sense of being on the receiving end of a con job.

Unfortunately, feelings of that sort were also part of the subtext to certain remarks last week by Bush's new SEC chairman, Christopher Cox, who told the Wall Street Journal just how tough he intends to be when it comes to pressing ahead with efforts to regulate the murky and crime-infested world of hedge funds.

Cox's predecessor, William Donaldson, made growling at the $1 trillion industry a priority pursuit after he took office in 2003. Yet Donaldson wound up resigning the chairmanship in defeat last June when he lost his base of support within the administration by pushing through regulations against the objections of not just two of his own SEC commissioners — but Federal Reserve Chairman Alan Greenspan himself.

more...

[UpInArms]

16. Fed's Moskow says wary on inflation targeting

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T130024Z_01_NAT001806_RTRIDST_0_ECONOMY-FED-MOSKOW-URGENT.XML

CHICAGO, Sept 26 (Reuters) - Chicago Federal Reserve President Michael Moskow on Monday said he was wary of setting strict numerical targets for inflation and that a flexible approach could still keep inflation expectations low.

"There are many issues that need studying before a final determination may be made," Moskow said in remarks prepared for the National Association for Business Economics meeting.

In the past the Fed's flexible monetary policy responses "did not jeopardize the pursuit of our long-run goal of price stability," Moskow said.

Even without rigid rules, Moskow said central bankers' approach to policy must be aimed at keeping inflation expectations at a low level.

...a bit more...

[UpInArms]

21. Fed Spew:

9:46am 09/26/05 FED'S BIES SAYS U.S. ECONOMY 'CORE-RESILIENT'

9:45am 09/26/05 FED'S BIES: HIGH ENERGY PRICES COULD AFFECT REST OF ECONOMY

9:40am 09/26/05 NABE: DOLLAR TO FALL UP TO 10% VS. CHINA'S YUAN NEXT YEAR

9:35am 09/26/05 NABE SEES U.S. UNEMPLOYMENT RATE HOLDING NEAR 5% IN '05, '06

9:35am 09/26/05 NABE SEES 'SHARP' LABOR COST ACCELERATION THIS YEAR FROM '04

9:32am 09/26/05 NABE PEGS 2005 U.S. GDP AT 3.5%, SEES 3.4% IN 2006

9:33am 09/26/05 NABE SEES U.S. CORE CPI AT 2.3% IN 2005, DOWN FROM MAY POLL

9:32am 09/26/05 NABE UPS U.S. GROWTH FORECAST FROM MAY POLL DESPITE KATRINA

[UpInArms]

68. WASHED-UP HAS-BEEN PARTISAN HACK SPEWS

1:30pm 09/26/05 GREENSPAN: HIGHER RATES WOULD CUT CASH FROM HOMES, SPENDING

1:30pm 09/26/05 GREENSPAN: MORTGAGE DEBT RISE DUE TO TAKING CASH FROM HOMES

1:30pm 09/26/05 GREENSPAN: MORTGAGE DEBT RISING FASTER THAN HOME VALUES

1:30pm 09/26/05 GREENSPAN: MOST PEOPLE HAVE CUSHION FOR HOME PRICE DROP

1:30pm 09/26/05 GREENSPAN: HOME PRICE FALL NOT NECESSARILY DISRUPTIVE

1:30pm 09/26/05 GREENSPAN: FED CLOSELY STUDYING HURRICANES' ECONOMIC IMPACT

[UpInArms]

70. Greenspan: Any home price fall not necessarily disruptive

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38621.5632498843-843803899&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Any decline in home prices would not necessarily be disruptive, Fed chief Alan Greenspan said Monday. In a speech to the American Bankers Association, Greenspan said it is "an open question" what the impact of higher mortgage rates or any drop in home prices would have on the economy. Consumer spending would fall as homeowners would not be able to finance spending from the rise in their home's value, but the low personal savings rate would rise and the U.S. trade deficit would shrink, Greenspan said. The vast majority of homeowners have a sizable equity cushion to absorb a potential decline in house prices, he said. "That said, the situation clearly will require our ongoing scrutiny in the period ahead, lest more adverse trends emerge," he said. In a short statement on Hurricanes Katrina and Rita, Greenspan said the Fed will continue to follow developments closely to assess their implications for the economy.

[UpInArms]

31. Fed needs to reduce accommodation-Fed's Moskow

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T141723Z_01_NAT001807_RTRIDST_0_ECONOMY-FED-MOSKOW-POLICY-URGENT.XML

CHICAGO, Sept 26 (Reuters) - Federal Reserve Bank of Chicago President Michael Moskow on Monday said it was still necessary for the Federal Reserve to reduce monetary accommodation in the U.S. economy.

Speaking to reporters after a speech, Moskow also said that U.S. economic fundamentals were strong and that the economy still had excess capacity.

"We still believe that (there is) excess capacity in the economy," Moskow said, adding "we feel it is necessary to reduce accommodation."

He said the effect of recent hurricanes on output and prices were temporary, but he noted that he was watching the boost in government spending in response to Hurricane Katrina.

[54anickel]

75. Fed Speeches Highlight Busy Week (Jaw-boning in full swing)

http://www.forexnews.com/NA/default.asp?f=N20050925D&cm=&cy=&ad=&cd=

US dollar rallied at the end of last week to post its third consecutive weekly gains against the euro, yen, sterling and swissie – only against the loonie did the dollar fail to gain ground. Given the fact that Hurricane Rita was not as bad as predicted – especially with respect to the region’s oil facilities – the market will now gear itself up for a busy week.

Apart from pouring over the numerous US economic indicators that are due to be released, the market will also be paying close attention to the plethora of speeches by Fed officials, including most notably the two speeches by Fed Chairman Greenspan on Monday and Tuesday. Additionally, speeches are scheduled this week for Chicago Fed President Moskow (Monday), Kansas City Fed President Hoenig (Monday and Tuesday), San Francisco Fed President Yellen (Tuesday), and Fed Board Governor Kohn (Thurday).

When traders are not glued to their television screens, they will have plenty of economic data to digest. First up are housing industry figures with both existing home sales and new home sales expected to remain near record high levels, but decrease slightly to an annual rate of 7.12 million units and 1.35 million units, respectively.

The Conference Board’s consumer confidence index comes out on Tuesday and is expected to decline to 94.7 in September from 105.6 in August. However, given the fact that the preliminary report from the University of Michigan’s consumer sentiment index for September plummeted to its lowest level since 1992, there is a strong possibility that the physical and psychological damage wrought by Hurricanes Katrina and Rita may have had a greater than expected negative impact on consumers.

more...

[UpInArms]

17. LIARS and CHEATS Dept: Frist's Political Future Darkens Over Questions on

Frist's Political Future Darkens Over Questions on Stock Sales

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

Sept. 26 (Bloomberg) -- At the start of this year, U.S. Senate Majority Leader Bill Frist was looking at a bright political future. He led his party to an expanded majority in the Senate in November and emerged as a leading Republican hopeful for the 2008 presidential race.

<snip>

``If there is really any evidence of insider trading, then he's in very serious trouble, and so is his party,'' said Gary Jacobson, professor of political science at the University of California in San Diego. ``It adds another brick to Democrats' argument that Republicans are corrupt.''

<snip>

Frist's HCA stock holdings in one of his blind trusts surged more than 30-fold from 2000 to 2001, according to financial disclosure statements filed with the Senate. By the end of 2001 he reported owning $500,001 to $1 million in HCA shares within an entity called Bowling Avenue Partners, which was part of his blind trust. That holding had been valued at $1,001 to $15,000 at the end of 2000. The leap in valuation could not have been the result of changes in share price; in 2001 HCA shares fell 12.4 percent after gaining 50.3 percent in 2000.

<snip>

Frist may face a Senate investigation over communications he had with the trustees of his assets that suggest he had a greater measure of control than reported over the blind trust. He faces federal investigations into his HCA stock sale, probes that will likely delve into his telephone and e-mail records, legal experts said.

<snip>

Senator Frist ordered the trustees to sell his shares on June 13, one month before the company said second-quarter profit would miss earnings estimates. The trustees notified Frist on July 1 that the shares had been sold. When HCA announced lower- than-expected earnings July 13, the stock fell $4.86 to $50.05, the biggest decline in more than two years. During the two-week period when Frist's sale occurred, the shares averaged $57.21, reaching a 52-week high of $58.60 on June 22. The shares closed Sept. 23 at $47.60, up $1.70, in New York Stock Exchange composite trading.

...more...

[spotbird]

27. Frist was nailed because he was going to run

It didn't make sense that the government would pursue this until it dawned on me that it eliminates a rival for them. Frist is now getting a taste of what he cooked, I wonder if it's bitter.

It will be fun to see what's in store for McCain.

[UpInArms]

56. Cox to recuse himself in Frist probe

http://www.marketwatch.com/news/story.asp?guid=%7BF9205FE5%2D5FB0%2D492A%2DB99C%2DAF560A8EB959%7D&siteid=mktw

WASHINGTON (MarketWatch) -- Securities and Exchange Commission Chairman Christopher Cox will recuse himself from an agency probe into stock sales by Senate Majority Leader Bill Frist, Cox said in a statement Monday.

"Because of my service in the congressional leadership for the last 10 years," Cox said, "I have recused myself in this matter.

"The purpose of the recusal is to avoid any appearance of impropriety in the commission's consideration of this case," he said.

Cox, who took office as SEC chairman Aug. 4, is a former Republican congressman from California. He donated $1,000 to Frist, R-Tenn., in 2000, according to Federal Election Commission records.

The SEC and Justice Department are looking into Frist's sales of shares in HCA Inc. (HCA: news, chart, profile) made this past summer.

Frist announced last week that he and his immediate family sold all the shares they owned in HCA in June.

...more...

[amandabeech]

67. He was supposed to make an SEC filing disclosing this sale

within 2 or 3 days of the sale if he was an officer, director or 10% shareholder counting shares held by his wife and minor children. The sale would be reported on Form 4 under Sec. 16(a) of the Securities Exchange Act. Someone needs to check on this.

It's the same problem idiot boy had when he sold his Harken stock. At that time, sales were supposed to have been reported within 3 days of the end of the month in which the sales took place. Idiot boy was months late.

The other sales reporting provision would be for a 5% or more shareholder "group" on Form 13D under Section 13(d) of the Exchange Act. My memory of the details of 13D filings escape me at the moment.

This guy is such pond scum.

[UpInArms]

18. pre-opening blather

9:00AM: S&P futures vs fair value: +5.6. Nasdaq futures vs fair value: +8.5. Futures indications, which still trade comfortably above fair value, continue to suggest a higher open for the equity market. With a dearth of early market-moving news, Rita-induced relief continues to dictate early sentiment. One piece of disappointing news has come from Walgreens (WAG), which missed Q4 (Aug) earnings forecasts by $0.02 on lower than expected sales, however, the market appears more focused on the fact that Q3 aggregate operating EPS growth for the S&P 500 will be 17% to 20%

8:30AM: S&P futures vs fair value: +5.9. Nasdaq futures vs fair value: +9.0. Futures trade versus fair value still setting the stage for the cash market's higher open... Aside from lower prices across the energy complex, with crude now trading at $63.89/bbl (-$0.63) and gasoline at $2.01/gal (-$0.076), blue chips are getting an additional boost from a 2.5% pre-market surge in Boeing (BA), which reached a tentative agreement with machinists...

U.S. markets may also be taking a bullish cue from huge gains in overseas markets. Japan's Nikkei 225 closed up 1.8% at a new four-year high while Britain's FTSE 100, Germany's DAX 30, and France's CAC 40 have climbed 0.5%, 1.8%, and 1.5%, respectively, all amid reports that Rita caused less damage than expected.

8:00AM: S&P futures vs fair value: +5.7. Nasdaq futures vs fair value: +8.0. The cash market is poised for a higher open, as Rita-related uncertainty has dissipated and sparked a relief rally with traders eyeing bargains after 2.1%, 1.7%, and 2.0% respective declines in the Dow, S&P, and Nasdaq...

[UpInArms]

22. 9:50 EST markets up and ecstatic!

Dow 10,482.08 +62.49 (+0.60%)
Nasdaq 2,128.78 +11.94 (+0.56%)
S&P 500 1,220.70 +5.41 (+0.45%)
10-Yr Bond 4.303 +0.55 (+1.29%)

NYSE Volume 183,864,000
Nasdaq Volume 183,296,000

9:40AM: As futures trading had suggested, the cash market opened on the upside... The fact that Hurricane Rita caused far less damage than feared, missing key refineries and muting a larger economic impact, has helped traders stage a relief rally in the early going. Following last week's 2.1%, 1.7%, and 2.0% respective declines in the Dow, S&P, and Nasdaq, bargain hunters have found even further support from falling crude oil prices (-$0.54 $63.65/bbl) as well as a 3.6% surge in Boeing (BA), which reached a tentative agreement with striking machinists...

Separately, Aug existing home sales (consensus 7.11 mln) will be released at the top of the hour...

[Roland99]

26. 11K Here We Come! Par-tay!

Christmas buying season coming up. Think Santa will bring some cash for people to pay their home heating bills?

[UpInArms]

30. 10:18 EST markets don't care if people freeze to death

Dow 10,496.15 +76.56 (+0.73%)
Nasdaq 2,128.93 +12.09 (+0.57%)
S&P 500 1,221.28 +5.99 (+0.49%)
10-Yr Bond 4.289 +0.41 (+0.97%)

NYSE Volume 364,638,000
Nasdaq Volume 334,087,000

10:00AM: The major indices have slipped from early peaks but maintain their positive stance as each of the ten sectors trade in positive territory... Leading the way higher is the Consumer Discretionary sector, amid a 1.3% jump in retailers and 0.7% climb in homebuilders... Despite weakness in the Treasury market, which has pushed up borrowing costs across the board, the rate-sensitive Financial and Utilities sectors have posted modest gains while strength in hardware and semiconductor has helped Technology recover some of last week's losses...

The early laggard is Energy, hovering just over the flat line amid crude's downtick (-$0.55 $63.64/bbl)... NYSE Adv/Dec 1918/702, Nasdaq Adv/Dec 1698/757

[ozymandius]

34. 10:37

Whodathunk that securities would represent the so-called "flight to safety"?

Dow 10,486.54 +66.95 (+0.64%)
Nasdaq 2,128.19 +11.35 (+0.54%)
S&P 500 1,220.47 +5.18 (+0.43%)
10-Yr Bond 42.90 +0.42 (+0.99%)
NYSE Volume 472,960,000
Nasdaq Volume 423,133,000

[54anickel]

36. Check out these charts from last week's Credit Bubble Bulletin!

http://www.prudentbear.com/creditbubblebulletin.asp



And this snip from the Q2 2005 “Flow of Funds” section at the end:

snip>

Not only is the ongoing U.S. Credit Bubble stoking The Global Liquidity Glut; it is also swelling the U.S. Household Balance Sheet. Household (including non-profits) Assets jumped $1.207 Trillion during the quarter, or 8.1% annualized, to a record $60.976 Trillion. Household Liabilities rose at a 9.8% pace to $11.142 Trillion. And the more aggressive we borrow, the greater the resulting asset inflation. Household Net Worth – referred to yesterday as our actual “savings and impressive at that!” by Larry Kudlow – jumped $940.3 billion during the quarter (7.7%) to a record $49.834 Trillion. Over the past year, Household Net Worth has inflated $4.284 Trillion, or 9.4% - representing about 35% of GDP for the period. This has been the upshot of Assets inflating $5.367 Trillion (9.7%), offset by Liabilities increasing $1.084 Trillion (10.8%). Real Estate holdings were up $708 billion (14.6% ann.) during the quarter and $2.673 Trillion (14.6%) over the past four quarters. For comparison, Real Estate holdings increased $1.462 Trillion during 2003. Household holdings of Financial Assets increased $438 billion during the quarter (4.8%) to $37.03 Trillion, with a one-year gain of $2.462 Trillion (7.1%).

The “Flow of Funds” remains an amazing document, although I will be the first to admit that one report now seems to blend right into the next. The data are painfully tedious, while at the same time extraordinarily illuminating. There is no mystery with regard to over-liquefied global financial markets; we continue to witness the greatest asset-based (securities and real estate) lending boom the world has ever experienced. And if we had any doubt that the Credit Bubble could continue to expand with the GSEs relegated to the infirmary, well, the ballooning Bank and Broker/Dealer balance sheets have, for now, settled the issue. And if we wondered how an increasingly securities-based Credit system could create sufficient instruments to sustain the Great Mortgage Finance Bubble, the ballooning ABS market has, for now, settled the issue. If we pondered the possibility that we were approaching some limit to the amount of leveraged securities speculation that the system could finance, well, ballooning “Fed Funds & Repo” and “Funding Corps” have, for now, settled the issue. The Flow of Funds provides us with the capacity to recognize and appreciate historic financial evolution.

And while the capacity for contemporary Credit excess continues to amaze, I become more convinced every quarter of the impossibility of avoiding a precarious endgame. Each quarter we are provided additional evidence that our contemporary Credit system is incapable of moderation and self-adjustment – Credit inflation begets only greater Credit inflation. And the Credit Bubble has now gone full-fledged international, a development consistent with surging oil prices and gold at a near 18-year high (not to mention global equities and bond prices). Global Credit systems have evolved to the point of having attained the capability to aggressively inflate in tandem. This has played a major role in buttressing the vulnerable dollar, thus delaying the inevitable dollar crisis. Importantly, this postponement has provided ample opportunity for major booms to unfold in global real estate and securities markets, oil exporting economies, commodity-based economies, global energy exploration and development, and emerging debt and equity markets. These respective booms today have, in an era of rampant global over-liquidity, the inherent capacity for engendering ongoing enormous Credit and speculative excess. The potential for a dollar crisis that would have incited a global debt crisis dissipated, opening the floodgates for extraordinary global Credit inflation and speculative excess.

And while the Global Credit Bubble will now be susceptible to potential crises around the globe, the “Flow of Funds” helps identify a potential fault-line in the nature of US securities finance. The confluence of booming mortgage Credit, ballooning Wall Street balance sheets, surging “repo” finance and unprecedented ABS issuance is seductively problematic. “Financial conditions” are patently and conspicuously much too easy. The “confluence” works magically in loose monetary conditions, creating only more liquidity and the loosest environment imaginable. This “confluence,” however, will function especially poorly when financial conditions eventually tighten, a development increasingly necessary to rein in heightened global inflationary pressures and precarious asset Bubbles.

[UpInArms]

46. U.S. regulator warns about looser mortgage lending

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-26T154046Z_01_N26113341_RTRIDST_0_ECONOMY-HOUSING.XML

PALM DESERT, Calif., Sept 26 (Reuters) - U.S. Comptroller of the Currency John Dugan on Monday said lenders have loosened underwriting standards, particularly for residential real estate, and warned banks that regulators would not hesitate to act if they see risk building to unhealthy levels.

"We will be watching, and watching closely, and we will not hesitate to act," Dugan told an American Bankers Association meeting in California.

"I hope it takes no more than a warning to get the industry's attention to arrest dangerous trends before they become full-blown problems. But we cannot shrink from the responsibility to do what it takes to safeguard the safety and soundness of national banks," he said.

Federal banking regulators have raised concerns about loose lending over the past months. Low interest rates and eased underwriting standards have helped boost the U.S. housing market for more than four years, and has led to double-digit price increases in some areas.

Dugan said the shift toward easing consumer credit has helped what he called "marginal borrowers" obtain loans while increasing banks' loan volume and profits.

...more...

[54anickel]

48. China: Limits on Yuan-U.S. Dollar to Stay (Did they just flip Snow & Bush

the finger?) :evilgrin:

China Says Limits on Yuan-U.S. Dollar to Stay, Despite Wider Range for Other Currencies

http://biz.yahoo.com/ap/050926/china_currency.html?.v=6

SHANGHAI, China (AP) -- The Chinese yuan fell slightly against the U.S. dollar Monday after Chinese officials rejected calls from Beijing's trading partners for faster currency reforms during weekend G-7 meetings in Washington.

Chinese authorities also strongly suggested Monday that the narrow trading band governing the U.S. dollar-yuan exchange rate's daily movement would remain, despite a move Friday to loosen controls on other currency rates.

snip>

Many of China's trading partners believe the yuan is undervalued, giving China an unfair trade advantage, and would like to see the yuan appreciate.

snip>

In a small step toward greater foreign exchange flexibility, Chinese authorities on Friday decided to expand the daily range the yuan could move against three currencies -- the euro, yen and Hong Kong dollar -- to 3 percent above and below their opening levels from the previous 1.5 percent band.

But they kept the daily trading band for the dollar-yuan exchange rate at a much narrower 0.3 percent in either direction -- the range announced in the July 21 revaluation. Since that date, the yuan has gained less than 0.3 percent against the dollar.

more...

[54anickel]

69. Dr Doom expects trouble between US and China

http://transcripts.businessday.co.za/cgi-bin/transcripts/t-showtranscript.pl?1127589415

snip>

LINDSAY WILLIAMS: I was reading your latest newsletter - where you talk about a trip that you’ve just completed in Israel and Iran - leading on from that what about political instability worldwide? At the conference yesterday you were talking in fairly forthright terms about the possibility of there being a major conflict quite soon - maybe you could expand on that for us?

MARC FABER: Basically the US has the naive belief that they won the cold war, but if you look at what happened after the cold war - the breakdown of communism, socialism, and the end of policies of isolation in India - you have over 3-billion people joining the world’s market economy, the capitalistic system, and it is remarkable how in China and also India and Russia per capita incomes have expanded since then. In China per capita incomes in real terms are doubling every ten years - and so these economies, in particular the Chinese economy has become huge. There are many markets in China - such as steel, cement, mobile phones, tobacco, beer - that are far larger than in the United States. So you have this rising China which then leads to a tremendous appetite for raw materials - and the rising commodity prices reflect the incremental demand for commodities coming from Asia, notably China, and so China’s top priority is to acquire resources. One of the reasons the Chinese are very interested in the African continent - it’s a very symbiotic relationship between Africa and China - they also obviously need oil, and oil comes from the Middle East to China. That leads to tensions with the United States because the US wants to largely control the supply of oil. The shipping lines go essentially through the Strait of Malacca - this is a strait that is only 1.5-miles wide where an American aircraft carrier could essentially block all oil shipments to China. Then it goes south to the Island of Taiwan - which leads the very important strategic position of Taiwan for the Chinese, incidentally also for the Japanese. So the US now has this strategic alliance with Japan - whereby they said they would defend Taiwan in any circumstances. The Chinese have become very close to the Russians - they had joint military exercises in July. The Chinese - having a border with Central Asia are of course very interested in Uzbekistan, Iran, Kazakhstan, Tajikistan, and Kurdistan. At the present time we have the American bases there - obviously the Chinese as well as the Russians are very eager to get the Americans out of that region. So I think that in the context of rising commodity prices, and in the context that show there is tightness in the market, and in the context of the hegemonic power of the US being challenged increasingly by the rising Chinese economy that has a much faster growth rate - that international conflicts will be inevitable in the long run. I’m not saying that World War Three will break out tomorrow - but I think that eventually we will have involvement of the Chinese and the Russians in the Middle East as well as the Americans - and this involvement will not be a joint exercise, but will be against each other.

LINDSAY WILLIAMS: You said a few things about George W Bush yesterday - your opinion of him as a US president?

MARC FABER: My opinion of him as a president is that he makes everybody else in the world look like a genius!

[54anickel]

71. China must halt gas exploration in East China Sea, says Japanese minister

http://www.forbes.com/work/feeds/afx/2005/09/22/afx2240410.html

TOKYO (AFX) - China must suspend exploratory activities in an East China Sea natural gas field, the Nihon Keizai Shimbun reported quoting Japan's Economy, Trade, and Industry Minister Shoichi Nakagawa.

Japan's Teikoku Oil Co has been granted clearance to begin test drilling near the disputed waters in the East China Sea.

'If private-sector activity is to be affected, it must be protected by law,' Nakagawa told the Nihon Keizai, indicating that the government is considering crafting legislation to enable the Maritime Self-Defense Force to patrol the area.

[UpInArms]

49. 12:18 EST numbers and blather

Dow 10,492.99 +73.40 (+0.70%)
Nasdaq 2,129.93 +13.09 (+0.62%)
S&P 500 1,221.18 +5.89 (+0.48%)
10-Yr Bond 4.285 +0.37 (+0.87%)

NYSE Volume 909,328,000
Nasdaq Volume 727,598,000

12:00PM: As futures trading had prefaced, the stock market opened higher as investors breathed a sigh of relief after Hurricane Rita caused far less damage than feared. Reports that the hurricane's weekend hit spared the Houston refinery region and had an altogether much less than expected impact have ushered buyers back to the table following 2.1%, 1.7%, and 2.0% respective declines in the Dow, S&P, and Nasdaq and have kept every economic sector trading on positive turf...

A dearth of data on both the economic and earnings fronts have also kept the focus on price action across the energy complex, as crude, gasoline, and natural gas prices trending lower have provided further support in sustaining the morning's gains... With respect to sector performance, Energy has run to the top of the list, up 1.1% on broad based buying interest that follows a 1.7% loss on Friday and adds to a 37.8% year-to-date gain... Despite weakness in the bond market, within which the benchmark 10-year note is off nine ticks and yielding 4.28%, the Utilities sector has risen 0.8% while the influential Financial sector's 0.5% rise lends muscle to the overall market...

Technology has also provided some early support, as an upbeat Barron's article about Advanced Micro Devices (AMD) and a Merrill Lynch upgrade on KLA-Tencor (KLAC) have helped chip stocks extend their 6.3% year-to date gain while hardware has gotten a lift from Apple Computer (AAPL), which has surged 2.1% after UBS raised its price target on the stock based on the belief that the iPod nano will fuel momentum into the holiday season...

Consumer Staples similarly experiences some push and pull action as Wal-Mart's reaffirmed same store sales guidance, two analyst upgrades of Kellogg (K), and Barron's favorable discussion of Heinz (HNZ) attempt to counter the effect of Walgreen's (WAG) disappointing earnings report. Although the retailer surprisingly missed Q4 (Aug) earnings forecasts by $0.02 on lower than expected sales, the market appears more focused on the fact that Q3 aggregate operating EPS growth for the S&P 500 will be 17% to 20%...

The Consumer Discretionary sector - amid a rebound in retail that falling gas prices has spurred, and with strength in homebuilding following strong August existing home sales (which checked in at 7.29 mln vs. the 7.11 consensus and from a 7.15 mln annual rate in July) - has also posted a solid 0.7% gain today... The Industrials sector (+0.1%), however, continues its flat line hovering, as positive news from Boeing (BA) regarding an agreement with its largest union and Honeywell's reaffirmed earnings guidance is somewhat offset by downgrade-induced plunges in Caterpillar (CAT), Cummins (CMI), and Ingersoll-Rand (IR)... NYSE Adv/Dec 2065/1036, Nasdaq Adv/Dec 1832/1025

[UpInArms]

57. 1:14 EST losing momentum

Dow 10,463.21 +43.62 (+0.42%)
Nasdaq 2,125.82 +8.98 (+0.42%)
S&P 500 1,218.25 +2.96 (+0.24%)
10-Yr Bond 4.282 +0.34 (+0.80%)

NYSE Volume 1,101,841,000
Nasdaq Volume 867,708,000

1:00PM: Not much has changed over the past half hour, as the major averages continue to vacillate in roughly the same ranges... The Industrials (-0.1%) and Health Care (-0.1%), however, have recently dipped below the unchanged mark. Relative weaknesses in construction and farming (-1.2%), industrial machinery (-1.0%), and diversified commercial and professional services (-1.1%) have challenged respective gains of 1.1% and 1.0% in aerospace and defense and environmental services...

Healthcare has lost ground as gains from mainstays like JNJ, PFE, MRK and UNH have been overshadowed by Abbott Labs' (ABT 42.76 -1.46) 3.4% tumble. Shares have hit a fresh 2005 low this morning, trending downward after announcing late Friday that it lost a patent infringement case against Boston Scientific (BSX 23.96 -0.40), and following Bear Stearns' subsequent removal of the stock from its focus list...NYSE Adv/Dec 2055/1122, Nasdaq Adv/Dec 1892/1029

12:30PM: As trading enters the lunch hour, market still holds onto the bulk of the day's gains even as crude turns positive... While oil has climbed to $64.40/bbl, the market has keyed in on the fact that Energy now trades at its best levels of the day. The sector, which has surged 1.3%, has found support from notable jumps in Haliburton (HAL 66.48 +1.47), Apache (APA 75.55 +1.69), and Transocean (RIG 61.13 +1.38) while Exxon Mobil's (XOM 64.62 +0.79) 1.2% rise has lent support to the Dow...

[54anickel]

95. 10,500 - so close, and yet so far. Give 'em credit for tryin'.

[54anickel]

51. We're extending our lives, but at what price?

Sheesh, I see another plot for a movie here...some bean-counters are just sooooo into numbers and nothing else.

http://www.boston.com/business/healthcare/articles/2005/09/26/were_extending_our_lives_but_at_what_price/

How much is an extra year of your life worth?

That blunt inquiry is at the heart of a Rand Corp. study to be published today, and the answers are sobering.

The well-known think tank found that costly future treatments such as improved defibrillators or drugs for Alzheimer's disease pose great financial risk to the Medicare program.

For instance, the study found that new pacemakers could cost Medicare and other insurers $1.4 million for every extra year of life they add. In comparison, healthcare economists often use $100,000 per added year of life as the maximum of benefit worth paying by the government insurer. In another example, the study predicted the use of tumor-strangling drugs would mean $498,809 per additional life-year.

Dana Goldman, the study's lead author and Rand's director of health economics, says the conclusions cut across the conventional wisdom that the biggest risk to Medicare is the aging of the US population.

more...

[ozymandius]

58. 1:15 numbers and blather

Dow 10,465.22 +45.63 (+0.44%)
Nasdaq 2,125.85 +9.01 (+0.43%)
S&P 500 1,218.44 +3.15 (+0.26%)
10-Yr Bond 42.85 +0.37 (+0.87%)
NYSE Volume 1,104,723,000
Nasdaq Volume 869,690,000

1:00PM: Not much has changed over the past half hour, as the major averages continue to vacillate in roughly the same ranges... The Industrials (-0.1%) and Health Care (-0.1%), however, have recently dipped below the unchanged mark. Relative weaknesses in construction and farming (-1.2%), industrial machinery (-1.0%), and diversified commercial and professional services (-1.1%) have challenged respective gains of 1.1% and 1.0% in aerospace and defense and environmental services...

Healthcare has lost ground as gains from mainstays like JNJ, PFE, MRK and UNH have been overshadowed by Abbott Labs' (ABT 42.76 -1.46) 3.4% tumble. Shares have hit a fresh 2005 low this morning, trending downward after announcing late Friday that it lost a patent infringement case against Boston Scientific (BSX 23.96 -0.40), and following Bear Stearns' subsequent removal of the stock from its focus list...NYSE Adv/Dec 2055/1122, Nasdaq Adv/Dec 1892/1029

[ozymandius]

60. HA! UIA - I see we're reaching for the same coin again.

[UpInArms]

62. Hiya Ozy!

:hi:

We do seem to be on the same clock!

[ozymandius]

83. Good to see you too. It's been really, really busy around here.

I wish for more time here but the museum has been in 4th - almost 5th gear the past few days.

[UpInArms]

78. 2:14 EST momentum now beginning to flow backward

Dow 10,439.09 +19.50 (+0.19%)
Nasdaq 2,119.05 +2.21 (+0.10%)
S&P 500 1,215.27 -0.02 (-0.00%)
10-Yr Bond 4.291 +0.43 (+1.01%)

NYSE Volume 1,321,223,000
Nasdaq Volume 1,051,677,000

1:30PM: As oil continues to notch new highs for the day, now at $64.70/bbl (+$0.51), the indices have pared gains yet remain comfortably above the flat line... At the same time, gold has staged a recent reversal. This morning, traders extended Friday's consolidation that followed an 18-year high hit last week, but futures contracts for December delivery are now up 0.6%...

A handful of gold stocks display relative strength as they shake off this morning's weakness and push to session highs. Newmont Mining (NEM 46.98 +1.35), which is the only component within the S&P gold group, has charged 3.0% ahead, while Placer Dome (PDG), which was off as much as 4.5% around the open after UBS downgraded the stock on valuation concerns, has also rebounded... NYSE Adv/Dec 2055/1122, Nasdaq Adv/Dec 1892/1029

[54anickel]

59. On 401(k)s, many dropping the ball

http://www.startribune.com/stories/535/5634235.html

snip>

Plenty of Americans are fumbling their 401(k)s. And as the accounts have come to replace old-style pensions, the small balances signal that Americans are off to a poor start in taking charge of their own retirements.

Some people never get around to signing up for their company savings plans. Others are intimidated by lists of investment choices the size of telephone directories. They often make the wrong choices. Still others refuse to learn the savings habit.

Half of all Americans in their late 50s have $10,000 or less saved in 401(k)-type plans or personal IRAs, according to the Retirement Security Project in Washington, D.C., an initiative of the Pew Charitable Trusts. That means many will have to drop their standard of living or work longer than they'd hoped.

Some economists say it's time to stop assuming that everyone can or wants to become accomplished investors, or that this nation's notorious spendthrifts will ever save serious amounts of money on their own.

snip>

The 401(k) -- and variations on it, such as the 403(b) and profit sharing -- were not intended to carry the show in retirement.

But now Social Security is in question. And in private industry, old-style pensions have gone the way of gold watches. In 1981, they covered 60 percent of Americans' workplace retirement plans. Twenty years later, 401(k)s claimed that 60 percent.

more...

[54anickel]

74. A Fool and His Money

http://www.321gold.com/editorials/litle/litle092605.html

snip>

Investing has many similarities to poker. For example: A small minority of professionals take the lion's share of profits. The house takes its cut from all comers with ironclad regularity. Odds allow for confidence, but never certainty - there is no hand that can't be beaten, no hand that cannot win. Both games are heavily influenced by luck in the short run, yet dominated by skill and consistency in the long run. And success is rarely the result of any one large decision; it is rather the result of countless small decisions, built into an accumulated edge over time.

The typical poker player reverts to the style he or she is most comfortable with in live play. This lack of variation gives the professional an edge, highlighting the best way to take the amateur's money. Poker predators usually assign one of three classifications to their prey: Maniac, Rock, or Calling Station. Of these three, the Calling Station is prized as the most reliable source of funds. The Maniac is dangerously aggressive, and often too hot; the Rock is notoriously tight-fisted, and usually too cold; but the lukewarm Calling Station is just right.

A passive aggressive type, the Calling Station has no grasp of strategy, yet feels compelled to participate. He or she is happy to call the majority of bets, rarely raising or taking control of the hand. Analysis is minimal, actions robotic. The Calling Station's attitude can be summed up as, "I don't really know what I'm doing, but I'm just glad to be here." A streak of good cards will occasionally reward this hapless style of play, but odds inevitably prevail over time. The Calling Station thus provides a steady stream of revenue for those who understand the importance of strategy and put it to use.

On Wall Street, the investing equivalent of the Calling Station is the Passive Indexer - the individual who seeks to unthinkingly mimic the performance of the Dow Jones or the S&P 500. Like his poker equivalent, the Passive Indexer is either unaware that strategy exists or unconvinced of its necessity - just happy to be a part of the action, hoping that luck or providence will provide a decent retirement. (Of course, the Passive Indexer is frequently encouraged to believe that providence is all he needs. This is rather like wolves encouraging sheep to believe the forest is safe.)

By contrasting the modest returns of passive indexing with the subpar returns of mutual funds, index touts pull off a neat trick: they make the bad look good by comparing it to worse. Adding insult to injury, many large mutual funds are actually "closet" indexers, charging for active management yet hugging the benchmarks anyway. This is like starting at the bottom and digging a hole.

more...

[54anickel]

76. Wall Street Bonuses May Rise More Than 10% After Record Profits

http://www.bloomberg.com/apps/news?pid=10000103&sid=aKeBMTId6epw&refer=us

Sept. 26 (Bloomberg) -- Wall Street bonuses may rise more than 10 percent this year with the securities industry, led by Goldman Sachs Group Inc., on pace for record earnings, compensation consultants said.

Investment bankers probably will get raises of as much as 20 percent as corporate takeovers and stock sales reach the highest levels since 2000, said Alan Johnson, president of Johnson Associates, a New York-based recruiting firm. Commodities traders may receive the second-biggest increases after oil prices more than doubled in two years, he said.

Goldman, Morgan Stanley, Merrill Lynch & Co., Lehman Brothers Holdings Inc. and Bear Stearns Cos., the world's five biggest independent securities firms, may post combined net income of $18.6 billion this year, up 8 percent from the all- time high in 2004, according to a survey of more than 15 analysts by Thomson Financial. Securities firms typically allocate almost 50 percent of their revenue, after interest expenses, for compensation.

``Perhaps more than any other industry, Wall Street pay is fairly highly correlated with performance and you can almost predict the bonus compensation going up in relation to the earnings,'' said Claude Johnston, a managing director at Pearl Meyer & Partners, a New York-based executive compensation consulting firm.

Wall Street is among the world's most lucrative businesses with managing directors, executives who lead groups of bankers or traders, regularly receiving annual pay packages of at least $1 million and top bankers earning more than $5 million.

more...

[UpInArms]

81. 2:44 EST all red now

Dow 10,415.37 -4.22 (-0.04%)
Nasdaq 2,113.12 -3.72 (-0.18%)
S&P 500 1,212.42 -2.87 (-0.24%)
10-Yr Bond 4.286 +0.38 (+0.89%)

NYSE Volume 1,447,930,000
Nasdaq Volume 1,150,235,000

2:35PM: The S&P and Nasdaq have slipped into the red, while the Dow hangs on to a modest gain in the face of unrelenting price increases across the energy complex. The Financials sector has hit its lowest point of the day, amid rising bond yields and as traders digest Fed Chair Greenspan's latest comments... Upon suggestion that the "froth" in the housing market may be spilling over into the mortgage market, the sector has declined 0.3% as banks (-0.5%) offset strength in insurance (+0.5%) that comes on Rita's heels... NYSE Adv/Dec 1874/1366, Nasdaq Adv/Dec 1605/1377

2:00PM: Indices still trade near session lows, as oil prices hit their highest levels of the day, but are showing some resilience above the flat line... Reversals in the influential financial and tech sectors have been the largest culprits behind recent market weakness, leaving Utilities, Materials and Energy - three of the four least influential sectors - as the only sectors in positive territory. However, a 1.7% surge in the latter, benefiting immensely from oil's ongoing rebound (+2.0%), has provided enough support to keep the market's head above water...NYSE Adv/Dec 1902/1286, Nasdaq Adv/Dec 1663/1272

[54anickel]

82. "Froth" may be spilling over - oh, that's rich!!! It's a damned tidal wave

[ozymandius]

84. witching hour madness - where'd the love go?

3:23
Dow 10,428.42 +8.83 (+0.08%)
Nasdaq 2,117.48 +0.64 (+0.03%)
S&P 500 1,214.22 -1.07 (-0.09%)
10-Yr Bond 42.94 +0.46 (+1.08%)
NYSE Volume 1,629,337,000
Nasdaq Volume 1,285,312,000

3:00PM: Aside from Energy (+1.3%) and Utilities (+0.6%), each sector is currently submerged, and, with that, each of the major indices are trading in negative territory. The Dow has recently relinquished its gain, as broad based pressure and particular losses from the likes of Caterpillar (CAT 58.28 -0.64), Alcoa (AA 24.19 -0.23), and Intel (INTC 24.20 -0.18) trump gains from Boeing (BA 64.60 +1.40), American International Group (AIG 60.68 +0.62), Exxon Mobil (XOM 64.80 +0.97), and McDonald's (MCD 33.01 +0.37). Each sector is at its worst level of the session, with Healthcare chalking the largest loss (-0.6%)...NYSE Adv/Dec 1752/1513, Nasdaq Adv/Dec 1583/1396

[ozymandius]

86. ever a bit lower

3:30
Dow 10,421.66 +2.07 (+0.02%)
Nasdaq 2,115.71 -1.13 (-0.05%)
S&P 500 1,213.34 -1.95 (-0.16%)
10-Yr Bond 42.94 +0.46 (+1.08%)
NYSE Volume 1,671,618,000
Nasdaq Volume 1,313,712,000

[UpInArms]

87. 3:40 EST all is well (fairies at 3:30?)

Dow 10,446.18 +26.59 (+0.26%)
Nasdaq 2,119.36 +2.52 (+0.12%)
S&P 500 1,215.76 +0.47 (+0.04%)
10-Yr Bond 4.294 +0.46 (+1.08%)

NYSE Volume 1,728,916,000
Nasdaq Volume 1,365,076,000

3:30PM: The indices are currently trading in flat fashion, hovering over the unchanged mark as the trading day heads into its close. A look at the market's breadth reflects that mixed lackluster sentiment. On the Big Board, advancers have a slim 17-to-16 edge over decliners, while on the Nasdaq, advancing and declining issues remain evenly matched... Mid and small cap issues, meanwhile, have fared better than blue chips today. Adding to its 5.6% year-to-date gain, the S&P 400 Midcap Index is up 0.4% while the Russell 2000 Index has similarly risen 0.4% on the day...NYSE Adv/Dec 1695/1564, Nasdaq Adv/Dec 1529/1451

3:00PM: Aside from Energy (+1.3%) and Utilities (+0.6%), each sector is currently submerged, and, with that, each of the major indices are trading in negative territory. The Dow has recently relinquished its gain, as broad based pressure and particular losses from the likes of Caterpillar (CAT 58.28 -0.64), Alcoa (AA 24.19 -0.23), and Intel (INTC 24.20 -0.18) trump gains from Boeing (BA 64.60 +1.40), American International Group (AIG 60.68 +0.62), Exxon Mobil (XOM 64.80 +0.97), and McDonald's (MCD 33.01 +0.37). Each sector is at its worst level of the session, with Healthcare chalking the largest loss (-0.6%)...NYSE Adv/Dec 1752/1513, Nasdaq Adv/Dec 1583/1396

[54anickel]

94. Wonder if they get OT pay for workin' after 2:30?...n/t

[54anickel]

85. AMERICA PROGRAMMED FOR WAR

Came across this while looking for the latest on the DoD budget...remember the one McCain and others wanted to tie anti-torture language to that got pushed back until after recess so they could concentrate on, ummm, err, ahh...I can't remember - having a brain fart but it was stupid! Any, this is an interesting read.

http://www.zmag.org/content/showarticle.cfm?SectionID=51&ItemID=8819

For instruction in times of confusion, it is often best to look at the beginning. There is no more instructive a place for today's condition than the start of the Cold War. This story contains within it the cause and solution: the weakest point in United States foreign policy, and a legal basis for the strongest push toward a peaceful change of priorities by the most dedicated people in America -- you.



"In the counsels of Government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the Military Industrial Complex. The potential for the disastrous rise of misplaced power exists, and will persist. We must never let the weight of this combination endanger our liberties or democratic processes."



-- President Dwight Eisenhower, upon leaving office; January 1961



1) The Long War: From NSC-68 to 2005



As University of Oregon's first graduate student in the transdisciplinary field of Peace Studies, it is my responsibility to explore the role of the military in society and those conditions that most promote peace and human welfare. Unfortunately, this task puts me in direct conflict with school administrators, including President Dave Frohnmayer, whose signature appears on my Bachelor's degree.



There is nothing personal about this conflict, and President Frohnmayer has done nothing out of the ordinary. Like the presidents of more than 350 other universities that help develop weapons for the Department of Defense (DoD), he is simply leading my school into an evermore intimate partnership with America's military industrial complex.



Federal programs that once served low-income people nationwide have been shut down, and states have had to cut funding for education to make up the difference. (Our servants in the White House are still trying to abolish the food stamp program.) Schools turned elsewhere for money, and -- bing -- here's DoD handing out major bucks for weapons research; outsourced projects that will in one way or another lead to the death of humans and other life systems.

lots more...

[54anickel]

91. India dumps old friend Iran for US nuclear carrot

http://www.expressindia.com/fullstory.php?newsid=55386

New Delhi, September 26: India's unexpected vote against old friend Iran over its nuclear programme stemmed from eagerness to project itself as a responsible nuclear power and safeguard a landmark atomic energy deal with Washington.

Although this will strain traditional ties with Iran, a key supplier of India's oil and gas, the damage could be offset by the emergence of other energy sources, officials and analysts said.

"India decided that a bird in hand is worth two in the bush," Manoj Joshi, editor of a daily newspaper, wrote on Monday.

"While the Iran-Pakistan-India pipeline remains to be negotiated, the Indo-US nuclear agreement is poised delicately in the US Congress," he said.

[54anickel]

92. Iran looking to its friends

http://www.atimes.com/atimes/Middle_East/GI27Ak02.html

snip>

Conclusion
The three year posturing between Iran and the US is moving closer toward confrontation. The US has been able to convince the EU-3 to put more pressure on Iran to abandon its desire to control the nuclear fuel cycle. However, as expected, both Russia and China have increased their resistance to attempts by the EU-3 and the US to place Iran before the council. Nevertheless, the US and the EU-3 have managed to push the IAEA board to pass a resolution that threatens to refer Iran to the Security Council if it does not pursue a series of measures to explain its nuclear activities.

Before the IAEA vote, Iran tried to demonstrate to the EU-3 that it will not abandon its wish to control the nuclear fuel cycle, even though this could damage economic and political relations with the European bloc. Tehran was betting that resistance by Moscow and Beijing to the joint US-EU-3 maneuvers would soften the EU-3's line and give Iran the ability to continue its nuclear research program. While a softer resolution was passed, it still damages Iran's interests since the resolution demands that Iran end the conversion of uranium and demands that it answer more questions about its nuclear research program.

It is important now for Iran to keep Russia and China on its side. If Iran does eventually get referred to the Security Council, it will need one of those two countries to veto any resolution that calls for sanctions. However, any such veto would create an international crisis and there is little doubt that both Russia and China want to avoid this development. It can be assumed that they will now put pressure on Iran to make its nuclear efforts look innocuous and to prevent a major escalation of rhetoric with the US and the EU-3.

The US, on the other hand, will have to continue to pressure the international community to resist Iran's wish to control the nuclear fuel cycle. With the intervention in Iraq draining US resources, Washington is not in a position to begin a new front across the border in Iran, even if that only involves executing air strikes on Iran's suspected nuclear facilities.

With the price of oil seeing record highs, the US and the EU-3 cannot afford to pursue any action that could result in uncertainty over oil supplies since that would push the price of oil even higher, threatening a recession in oil dependent countries. Indeed, this concern could also affect how willing the US and the EU-3 will be to eventually implement sanctions on Iran, since this too would create concern in the market.

more...

[54anickel]

96. White House Warns Iran About Referral

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1807418

http://www.sfgate.com/cgi-bin/article.cgi?file=/n/a/2005/09/26/national/w133537D24.DTL&type=printable

snip>

"The world is saying to Iran that it is time to come clean. The world has put Iran on notice," White House press secretary Scott McClellan said. "It is unacceptable the way Iran is behaving."

On Saturday, a majority on the 35-nation board of the U.N.'s nuclear watchdog agency approved a resolution that cited Iran for "a long history of concealment and deception" in a nuclear program Tehran insists is only for the peaceful production of nuclear power. The International Atomic Energy Agency resolution found Tehran at odds with its obligations under the Nuclear Non-Proliferation Treaty that Iran signed.

According to the resolution, Iran's past failings already set it up for consideration by the Security Council — though there was no immediate referral. Instead, the resolution asked IAEA members to look at the issue again at a future, unspecified meeting.

It wasn't the decisive rebuke desired by U.S. officials — who allege Iran has a secret illicit program to build a nuclear bomb and have long wanted Tehran reviewed by the Security Council and possibly punished with economic sanctions. While India switched its position to support the resolution, U.S. allies Russia, China and South Africa abstained from the vote.

more...

Looks like Iran's friends came through for them, though not a veto, looks like one wasn't needed yet.

[54anickel]

89. Bush inherits the wind (He's an idiot!)

http://www.dailytimes.com.pk/default.asp?page=story_25-9-2005_pg3_7

There is a deep disconnect in American politics between scientific knowledge and political decisions. Bush bears much responsibility for this. He has proven to be one of America’s least knowledgeable presidents when it comes to science — and one of the most ready to turn science into a political issue

The most shocking statement in the aftermath of Hurricane Katrina was President George W Bush’s remark that “I don’t think anybody anticipated the breach of the levees” that protect New Orleans from flooding. New Orleans is a city mostly below sea level, and must be protected by levees to keep water out. Concern that the levees might break in the midst of a powerful hurricane was widespread among scientists, engineers, and emergency-preparedness experts. Yet Bush apparently did not know of these concerns, even days after the hurricane destroyed the levees and flooded the city.

There is a simple fact on display here, one that goes well beyond this particular hurricane, and even this particular president. There is a deep disconnect in American politics between scientific knowledge and political decisions. Bush bears much responsibility for this. He has proven to be one of America’s least knowledgeable presidents when it comes to science — and one of the most ready to turn science into a political issue.

In recent months, Bush undermined biological theories of evolution in favour of Christian fundamentalist dogmas. He disdains climate science and public health science when it conflicts with the beliefs — and interests — of his core supporters. Simply put, Bush’s record on science policy is miserable.

more...

[54anickel]

90. NPRA Supports the President's Call to Increase U.S. Refinery Capacity

I'll bet they do, on MY dime!!!

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20050926005936&newsLang=en

WASHINGTON--(BUSINESS WIRE)--Sept. 26, 2005--Bob Slaughter, President of NPRA, the National Petrochemical & Refiners Association, released the following statement on President Bush's comments calling for an increase in much-needed U.S. refining capacity.


"NPRA strongly supports President Bush's call today to encourage additional U.S. refining capacity. We believe that it is imperative that our energy policy encourage additional supplies of energy and an increase in U.S. refining capacity. Both Hurricanes Rita and Katrina have revealed the current fragile energy supply/demand balance and the vulnerabilities of the nation's energy infrastructure. Increased U.S. refining capacity, whether in the form of additional capacity at existing sites, or through new grassroots refineries, would help increase the supply of domestically-manufactured petroleum products.

"Our member companies are working hard to restore capacity damaged by the storms as quickly and safely as possible. Currently, efforts are under way to assess the full impact of the storm and how long any shut downs will persist. NPRA applauds President Bush's swift and decisive steps concerning emergency fuel waivers for certain gasoline and diesel fuel requirements. These actions will go a long way to avoid or mitigate potential supply disruptions across the nation.

"NPRA is also extremely concerned about the current natural gas supply situation. We must implement policy changes to encourage increased natural gas supplies for use by U.S. consumers. NPRA favors policies that will encourage increased natural gas production from domestic sources, both onshore and offshore. U.S. petrochemical producers rely on an adequate supply of natural gas and gas liquids at reasonably predictable prices to maintain their competitive position in a difficult global market."

more...

[54anickel]

93. Closin' time

Dow 10,443.63 +24.04 (+0.23%)
Nasdaq 2,121.46 +4.62 (+0.22%)
S&P 500 1,215.63 +0.34 (+0.03%)
10-yr Bond 4.294% +0.05
30-yr Bond 4.558% +0.05
NYSE Volume 1,997,828,000
Nasdaq Volume 1,537,538,000


Despite a lack of sector leadership and 2.5% surge in oil prices, all three major indices found a way to close higher. While the stock market opened on an upbeat note and spent most of the day chalking gains, the early relief rally spurred by less than feared damage related to Hurricane Rita stalled and, had it not been for leadership in Energy - one of only three sectors to close in positive territory - the market may have finished the same way it ended last week...
A realization that, although the Houston refining region had been spared, the storm had nonetheless exacerbated energy supply disruptions sent prices across the energy complex surging and the indices south. Specifically, reports that refineries in Port Arthur and Beaumont, TX and Lake Charles, LA may be shut longer than expected and that hurricanes have shut at least 29% of refining capacity closed crude oil futures up $1.63 at $65.82/bbl...

Utilities, which got a lift after Entergy (ETR 73.11 +1.11) was upgraded at Lehman Brothers, and Consumer Discretionary, amid modest gains in autos and homebuilding, were the only other sectors to chalk gains. Homebuilding climbed following strong August existing home sales, which checked in at 7.29 mln vs. the 7.11 consensus and from a 7.15 mln annual rate in July...

With regard to sector weakness, the Financial sector failed to provide any upside leadership, after Fed Chair Greenspan stated that "froth" within the housing market may be affecting the mortgage market. Day-long weakness in the Treasury market, as the 10-year note closed down 12 ticks to yield 4.29%, also weighed on the rate-sensitive sector. The Tech sector's (-0.2%) day long laggard status was the result of wide spread selling pressure that left most of the tech titans posting losses. Sector weakness also countered the effects of an upbeat Barron's article on Advanced Micro Devices (AMD 23.67 +0.69), an analyst upgrade on KLA-Tencor (KLAC 47.98 +0.62) and strength in Apple Computer (AAPL 53.84 +0.64), which surged after UBS raised its price target on the belief that the iPod nano will fuel momentum into the holiday season)...

Consumer Staples experienced some push and pull action today, closing flatly as Wal-Mart's (WMT 43.09 +0.11) reaffirmed Sept. same-store sales guidance of 2-4% growth and two analyst upgrades on Kellogg (K 44.54 +0.48) balanced the effect of Walgreen's (WAG 41.49 -1.02) disappointing Q4 (Aug) earnings report... Despite soaring Boeing (BA 64.69 +1.49) shares, due to reports that the company reached an agreement with its largest union, Industrials' (-0.2%) advance was muted by downgrade-induced plunges in stocks that included the Dow's Caterpillar (CAT 58.34 -0.58)...DJTA -0.20, DJUA +0.90, DOT +0.20, Nasdaq 100 +0.07, Russell 2000 +0.63, SOX +0.46, S&P Midcap 400 +0.55, XOI +1.57, NYSE Adv/Dec 1867/1443, Nasdaq Adv/Dec 1724/1292

3:30PM : The indices are currently trading in flat fashion, hovering over the unchanged mark as the trading day heads into its close. A look at the market's breadth reflects that mixed lackluster sentiment. On the Big Board, advancers have a slim 17-to-16 edge over decliners, while on the Nasdaq, advancing and declining issues remain evenly matched... Mid and small cap issues, meanwhile, have fared better than blue chips today. Adding to its 5.6% year-to-date gain, the S&P 400 Midcap Index is up 0.4% while the Russell 2000 Index has similarly risen 0.4% on the day...NYSE Adv/Dec 1695/1564, Nasdaq Adv/Dec 1529/1451

Have a great evening! :hi: