STOCK MARKET WATCH, Friday September 29

[ozymandius]

Friday September 29, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 845 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2102 DAYS
WHERE'S OSAMA BIN-LADEN? 1808 DAYS
DAYS SINCE ENRON COLLAPSE = 1769
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
Enron execs conveniently deceased = 3
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
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON September 28, 2006

Dow... 11,718.45 +29.21 (+0.25%)
Nasdaq... 2,270.02 +6.63 (+0.29%)
S&P 500... 1,339.15 +2.56 (+0.19%)
Gold future... 610.90 +7.60 (+1.24%)
30-Year Bond 4.77% +0.03 (+0.72%)
10-Yr Bond... 4.63% +0.03 (+0.70%)






GOLD, EURO, YEN, Loonie and Silver


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

[Nimrod2005]

1. Good morning Oz, this is amazing, a day after America died, torture and

Wiretaping...etc. We may see some people celebrate a new DOW all time high!!!

What will the country look like 10 years from now? I wonder...

[ozymandius]

16. Good morning.

:donut:
I wonder what ten years hence will look like too. Somehow, I do believe that we will still be digging out of this mess Bush&Co have made. And that's just the mess inside our national borders.

[specimenfred1984]

48. Don't confuse the markets with Americans

The markets are run by a few fascist banks/trading firms like Morgan Stanley, Merril Lynch, Goldman Sachs. The average America only has 30G for retirement, not even enough to buy a new car.

If Americans ever get control of the markets back through regulation and law, we'll see an entirely different thing.

[Ghost Dog]

50. Study: U.S. middle class in worse shape than ever

http://today.reuters.com/news/articlenews.aspx?type=domesticNews&storyID=2006-09-28T200444Z_01_N28195040_RTRUKOC_0_US-ECONOMY-MIDDLECLASS.xml
Thu Sep 28, 2006 4:05pm ET

WASHINGTON (Reuters) - The typical double-income family in the United States is worse off financially than ever, a study released on Thursday said, warning that few Americans have saved enough to brace for financial setbacks. Middle-class families are struggling to pay for a home, health insurance, transportation and their children's college with wages that have not kept pace with higher prices, according to the study by a think tank headed by a former top aide to President Bill Clinton.

<snip>

The majority of Americans have not socked away enough money to brace for financial setbacks such as a job loss or a medical emergency.

According to the study, less than a third of all American families have accumulated income equaling three months of their wages. The trend is particularly pronounced among the 60 percent income distribution that makes up the middle class: those with dual incomes earning from $18,500 to $88,030 a year. From 2001 to 2004, the proportion of middle-class families that has saved three months' worth of income dropped to 18.3 percent from 28.8 percent, the study said.

Higher prices for a range of things -- including health care, energy, transportation, food and education -- have put Americans in this position as corporate profits have risen, the study said. It said, that five years into the current economic recovery, average job growth is one-fifth that of previous business cycles and wages are flat when inflation is factored into the equation.

To maintain day-to-day consumption, families have taken on a record amount of debt, equal to 126.4 percent of disposable income in the first quarter of 2006, according to the study.

Commenting on the study, SEIU Labor Union President Andy Stern said, "Of the total amount of our economy and income, we have the greatest share going to profits in modern history and the least amount going to wages in modern history. "For most working Americans, things are far worse than any time certainly in recent history and at a time of an incredibly growing economy." said Stern, whose union represents 1.1 million health care workers.

[Ghost Dog]

2. --> Placemarker for Asian & European stuff here:

(Morning, folks. Know how you feel :-( ).

[Ghost Dog]

3. China economy 'soft landing' expected

http://www.chinadaily.com.cn/bizchina/2006-09/28/content_698936.htm

(Xinhua) China's economy is moving towards a 'soft landing' but the government must not ease up on its macro control measures, accoding to a state think tank under the National Development and Reform Commission.

Although July data are hardly grounds for determining a shift, 'various signs in August indicate that the earlier macroeconomic tuning measures have started to take effect,' pointing to a soft landing, the Academy of Macroeconomic Research said. 'The effects are just preliminary. Investment growth is still too high and it is difficult to eliminate the ripple effect of overheating investment. We must not relax macro control measures,' the report said.

China has raised interest rates and reserve requirement for banks twice since late April to rein in rapid growth in credit and investment and introduced a slew of new policies to cool certain overheating sectors, including real estate. Urban fixed asset investment slowed dramatically in July and August, after hitting peak growth of 33.7 pct in June, the state think tank said in a report published in the official China Securities Journal.

The report forecast investment growth to continue to slow in the coming months, but growth for the whole year will remain at a relatively high levels. The FAI growth rates for July and August were 27.4 and 21.5 pct respectively, 6.3 and 5.9 percentage points lower than the previous month. The rapid growth in credit is also easing, the report said.

The broad measure of money supply, M2, grew 17.9 pct year-on-year at end-August, the lowest level since the beginning of the year and 0.5 percentage points slower than in the previous month.

<snip>

In the next phase authorities should continue to limit excess growth in fixed-asset investment, control new projects and clear up those under construction, and tighten regulation on land use, the report said. It also urged the government to step up adjustments in the real estate market to limit speculative investment and high property prices. The authorities should continue to tighten liquidity by further raising reserve requirements for banks or interest rates when necessary, it added.

/...

[Ghost Dog]

8. China stocks close at 29-month high

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060929:MTFH90665_2006-09-29_07-04-03_SHA354501&type=comktNews&rpc=44

SHANGHAI, Sept 29 (Reuters) - Chinese shares closed at a 29-month high on Friday, as mutual funds built fresh positions ahead of a long national holiday next week, and amid optimism over next month's listing of Industrial and Commercial Bank of China .

The benchmark Shanghai composite index <.SSEC> closed up 0.9 percent at a provisional 1,752.424 points, its highest finish since April 8, 2004, when it ended at 1,770.279.

/...

[Ghost Dog]

4. Indian GDP grows annual 8.9 pct in Apr-June qtr

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060929:MTFH90582_2006-09-29_07-00-36_BOM291055&type=comktNews&rpc=44

NEW DELHI, Sept 29 (Reuters) - India's economy grew by 8.9 percent in the April-June quarter from a year earlier, higher than expectations, boosted by manufacturing and services output, data showed on Friday.

The annual expansion rate in the first quarter of the 2006/07 financial year was lower than the January-March rate of 9.3 percent. It was above analysts' forecast of 8.5 percent annual growth, and it raised expectations for further interest rate rises.

"Domestic factors argue for further tightening while the uncertainty about U.S. outlook suggests a wait-and-watch approach," said A. Prasanna, analyst at ICICI Securities, Mumbai.

Agriculture -- which accounts for about 23 percent of GDP -- grew at an annual pace of 3.4 percent in the quarter, compared with 5.5 percent annual growth in January-March. Manufacturing output, which accounts for nearly 15 percent of GDP, expanded by an annual 11.3 percent, faster than the growth rate of 8.9 percent in January-March.

/...

[Ghost Dog]

5. Price data backs view BOJ will keep rates on hold

http://yahoo.reuters.com/news/articlehybrid.aspx?type=comktNews&storyID=2006-09-29T063833Z_01_T310048_RTRIDST_0_ECONOMY-JAPAN-UPDATE-5.XML

TOKYO, Sept 29 (Reuters) - Japanese consumer prices rose 0.3 percent in August from a year earlier, government data showed on Friday, matching market expectations and reinforcing the view that the Bank of Japan will hold off on another interest rate rise until at least early next year.

The increase in the core consumer price index (CPI), which excludes fresh food costs, was the biggest since March 1998, when it rose 1.8 percent.

But the rise was mostly due to high fuel oil prices and was only slightly above July's 0.2 percent growth, prompting markets to stick to the view that interest rates are unlikely to be raised again in the near future.

Other data showed industrial production rose after slipping in July, while the unemployment rate remained near an eight-year low, a sign that strength in domestic demand continues to underpin the economy.

"Overall, today's data shows that the economy is continuing to recover, but this doesn't change the Bank of Japan's stance that it is not in a hurry to raise rates," said Xinyi Lu, chief strategist for international treasury and trading at Mizuho Corporate Bank.

/...

[Ghost Dog]

7. Nikkei closes higher but down 5.5 pct in half-year

http://yahoo.reuters.com/news/articlehybrid.aspx?type=comktNews&storyID=2006-09-29T065213Z_01_T370488_RTRIDST_0_MARKETS-JAPAN-STOCKS-UPDATE-7.XML

TOKYO, Sept 29 (Reuters) - The Nikkei average rose 0.64 percent on Friday, extending gains for a third session as Softbank Corp. (9984.T: Quote, NEWS, Research) soared on hopes for a new line-up of cellphones, but the market logged a 5.5 percent decline for the first half of the 2006/07 fiscal year.

Data showing that consumer prices in Japan were modestly higher in August gave investors some relief, pushing up property and other domestic-demand led sectors, analysts said.

"I think the view that the Japanese economy will be supported by strong capital spending and that the U.S. economic slowdown won't be serious will gain currency in the market," said Masaki Iso, head of Japanese equities at Yasuda Asset Management Co. Ltd.

"If everything goes well, the Nikkei will likely reach 17,000 by the end of December," he added.

The Nikkei <.N225> ended 102.73 points higher at 16,127.58.

For the April-September period, however, the benchmark lost 5.5 percent. That compared to a 16 percent gain in the same period last year.

/...

[Ghost Dog]

9. JGBs drop as data backs view on gradual BOJ hikes

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060929:MTFH90609_2006-09-29_07-01-34_T327235&type=comktNews&rpc=44

TOKYO, Sept 29 (Reuters) - Japanese government bonds slid on Friday after data showed a slight pick-up in core consumer prices and a solid gain in industrial production, reinforcing the outlook for gradual interest rate rises by the Bank of Japan.

JGBs fell for a third straight session after the data, largely as expected, showed the economy holding up in the face of a slowdown in the U.S. economy, raising some worries about an upbeat tankan survey of business sentiment on Monday.

A mild rise in Tokyo shares also put bonds on the back foot, but overall activity was quiet as many investors shied away from taking positions before closing their books for the first half of the fiscal year on Friday.

"We're waiting for the tankan on Monday, so investors are not really doing anything," said a senior trader at a Japanese investment bank.

The BOJ's September tankan report, which is forecast to show steady confidence and solid capital spending, will help clarify whether the BOJ is likely to raise rates from 0.25 percent this year or within the business year ending next March.

/...

[Ghost Dog]

10. New PM seeks stronger Japan, better Asian ties

http://www.afp.com/english/news/stories/060929053806.t65e4g7u.html

TOKYO (AFP) - New Prime Minister Shinzo Abe used his first speech to parliament to call for a more assertive Japan and revisions to the pacifist constitution, while holding out an olive branch to Asian neighbors.

Abe laid out the vision for his new government as a news report said he would fly to South Korea next week in a bid to repair ties strained under his predecessor Junichiro Koizumi.

But Abe also outlined a staunchly conservative agenda at home, including revising the US-imposed 1947 constitution that has officially barred Japan from maintaining a military.

<snip>

The first step would be for parliament to pass a bill paving the way for a national referendum. The new constitution also needs support from two-thirds of each house of parliament. The constitution barred Japan from ever maintaining a military again, in effect putting the country under the protection of the United States. Constitutional changes enjoy wide support in Japan, although opinions are divided on how far to deviate from official pacifism.

<snip>

Abe has come under criticism for putting less focus on the economy, which has recovered under Koizumi despite criticism that the gap has grown between rich and poor.

He insisted that Japan could still grow despite its shrinking population.

"What a new Japan must aim to achieve is a society that rewards hard workers. Winners and losers must not be irreversible," he said.

/...

[Ghost Dog]

6. European stocks extend four-month high

http://www.ft.com/cms/s/de80237c-4f84-11db-9d85-0000779e2340.html

European stocks were higher on Friday, with Frankfurt’s Xetra Dax leading the way, passing 6,000 for the first time since May, and London’s FTSE 100 well within sight of the same level.

In early trade, the FTSE Eurofirst 300 gained 0.2 per cent to 1,400.64, extending its four-month high. The Dax was up 0.4 per cent to 6,012.78, the FTSE 100 added 0.2 per cent to 5,983.6 and the CAC 40 in Paris gained 0.3 per cent to 5,267.03.

<snip>

“WIth the potential for funds to push for a close above 6000 for both the FTSE and Dax, most markets will be on hold this morning ahead of the core PCE figure, widely recognised to be the Fed’s favourite inflation indicator,” said Martin Slaney, head of spread betting at GFT Global Markets.

/...

[Ghost Dog]

32. Lunchtime update:

http://www.ft.com/cms/s/de80237c-4f84-11db-9d85-0000779e2340.html

European stocks pushed through significant highs on Friday, with Frankfurt’s Xetra Dax and London’s FTSE 100 both passing through 6,000 as auto stocks and financial groups led the way.

By midday, caution had set in, and the main indices pared their gains. The FTSE Eurofirst 300 was up 0.1 per cent to 1,398.86, the Dax was up 0.4 per cent to 6,011.93, the FTSE 100 turned flat at 5,969 having earlier reached 6,002.9, and the CAC 40 in Paris gained 0.3 per cent to 5,267.88.

/...

http://today.reuters.co.uk/news/articleinvesting.aspx?type=stocksNews&storyID=2006-09-29T113437Z_01_NOA922243_RTRUKOC_0_MARKETS-STOCKS-FRI.xml

FTSE pulls back from 6,000 level

LONDON (Reuters) - The FTSE 100 gave up early gains on Friday, the last trading day of the quarter, after breaking through the 6,000-point psychological ceiling for the first time since mid-May and following a strong finish on U.S. markets overnight.

"The market is up near the 6,000-points mark in light volumes," said Michael O'Sullivan, strategist at State Street Global Markets.

"What is interesting is the sectors which are driving things, as we've been seeing a much better performance from defensives as most macro-economic numbers surprise on the downside and things like oils, talked up on the back of rising demand, lose some steam."

/...

[Ghost Dog]

52. Xetra Dax holds above 6,000 level

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38989.5206365741-882363036&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

European stocks pushed through significant highs on Friday, with Frankfurt’s Xetra Dax and London’s FTSE 100 both passing through 6,000 as auto stocks and financial groups led the way. Caution had set in however, and the main indices pared their gains. The FTSE Eurofirst 300 slipped 0.1 per cent to 1,396.45, but was up 2 per cent on the week. The Dax was up 0.3 per cent to 6,004.33 and the CAC 40 in Paris ended flat at 5,250.01.

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38989.5172453704-882362868&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

FTSE 100 briefly breaches 6,000 level

London equities broke through the key 6,000 barrier on Friday amid continued strength in world equity markets. With the Dow Jones Industrial Average briefly overtaking its record closing high overnight, the FTSE 100 touched 6,002.9 in morning trade. This is its highest level since the index suffered a 10 per cent correction in May and took its gains for the week to more than 3 per cent. In a bumper day for UK equities, the mid-cap FTSE 250 breached the 10,000 level, also for the first time since May. However profit taking drove the FTSE 100 lower, ending 0.2 per cent down at 5,960.8 but the FTSE 250 rose 0.2 per cent to 9,996.8.

[Ghost Dog]

33. Oldest profession boosts Greek output

http://www.ft.com/cms/s/d2b246a2-4f15-11db-b600-0000779e2340.html

Greece suddenly found itself 25 per cent richer on Thursday after a surprise upward revision of its gross domestic product, the fruit of a change to national accounts designed to capture better a fast-growing service sector – including parts of the black economy such as prostitution and money laundering.

The country’s newfound wealth raised eyebrows in Brussels, because it means Greece will find it easier to bring its budget deficit below the European Union’s 3 per cent of GDP ceiling.

Having previously been found guilty of underestimating the size of its budget deficit, Greece’s new GDP calculation will be scrutinised by Eurostat, the EU statistics agency.

“Member states revise their figures regularly, but this is quite a significant revision and needs to be checked,” said a spokeswoman for Joaquín Almunia, EU monetary affairs commissioner. Mr Almunia’s aides admit they were surprised by Athens’ announcement, which was not discussed in advance with Brussels or other EU finance ministers. Typically, such upward GDP revisions are of between 1-2 per cent, although Greece and Italy have each previously made big revisions.

However, Greece’s finance minister defended the 25 per cent upward revision of annual gross domestic product since 2000 as the result of “improved measurement” of a fast-growing services sector.

/...

[AnneD]

40. Morning Marketeers,

:donut:and lurkers. The weather outside is gorgeous, the air is fresh and cool, it's a beautiful day and yet I am profoundly sad. With very few exceptions outside this thread, most folks can't comprehend why I am so sad. I have been fighting against Bush for a long time (remember, I went through his 2 terms as governor of Texas). I had hoped to wait until the 2008 election cycle before making a decision about remaining in this country, and still will. But ten years from now, I truly may be out of this country for good. I haven't spoken to Mom about it-she thinks I am a bit nutty about the current administration. But even my fairly apolitical hubby has been concerned about the turn this country is taking (but in all fairness to my Mom-he is surrounded by politically active folks).

One thing that I have learned by being a citizen of this country is that I am a free person. The government is created to do MY bidding, not the other way around. I have the right to go when and where I choose at the time of my choosing. I have the right to protect myself. I have the right to an attorney and the right to remain silent (and torturing me to make me speak violates this). I cannot be detained against my will if I have not committed a crime and my attorney (and family) has the right to know where I am. I have the right to know what crimes I have committed, who is accusing me. I have a right to have a group of folks like me decide if I am guilty of these crimes. If I AM guilty, my punishment cannot be cruel and unusual. I have the right to speak my mind-even if my government doesn't want to hear it. I can go to worship or not if I choose; and if I choose to worship, I can worship freely, be it the Great Pumpkin, Jesus, Allah, or Money-which is so popular with many of our leaders. I can get together with a bunch of my friends and call my leader Satan and his minions idiots. We can write leaflets saying as much and that is NOT a crime.

But the thing I do not have the right do is sit quietly and watch this happen to my country. I will fight as long, loud and hard as I can. But if a majority of citizens choose otherwise.....that my friends, is why I am so sad on this beautiful fall day.

Happy hunting and watch out for the bears.

[Ghost Dog]

47. Hi AnneD. I guess the question is,

How much are people prepared to pay for that freedom, for those rights.

So hard-won over such a long time; so easy to lose so fast.

[AnneD]

49. I have been making...

installment payments for the last 14 years in the form of voting, protesting, giving money, writing, registering voters, driving folks to the polls, phone banking. And that doesn't even include my military service.

But today I feel:banghead: My head aches, my heart aches, and my soul aches. And I am embarassed and disgusted that so many Americans don't 'get it'. Maybe these folks will be happy with the government they have-they deserve it if they don't have the balls to stand up to it.

[UpInArms]

11. Today's Reports:

Sep 29 8:30 AM
Personal Income Aug
Market expects 0.4%
Last report 0.5%

Sep 29 8:30 AM
Personal Spending Aug
Market expects 0.2%
Last report 0.8%

Sep 29 9:50 AM
Mich Sentiment-Rev. Sep
Market Expects 84.4
Last report 84.4

Sep 29 10:00 AM
Chicago PMI Sep
Market expects 56.5
Last report 57.1

[UpInArms]

29. 8:30 reports - negative savings, core inflation up

8:30 AM ET 9/29/06 U.S. AUG. PERSONAL SAVINGS RATE NEGATIVE 0.5%

8:30 AM ET 9/29/06 U.S. AUG. COMPENSATION UP 0.1%, WAGES UP 0.1%

8:30 AM ET 9/29/06 U.S. AUG. REAL CONSUMER SPENDING FALLS 0.1%

8:30 AM ET 9/29/06 U.S. CONSUMER INFLATION UP 3.2% YEAR-OVER-YEAR

8:30 AM ET 9/29/06 U.S. CORE CONSUMER INFLATION UP 2.5% Y-O-Y, 11-YEAR HIGH

8:30 AM ET 9/29/06 U.S. AUG. CONSUMER SPENDING UP 0.1% VS. 0.2% EXPECTED

8:30 AM ET 9/29/06 U.S. AUG. PERSONAL INCOMES UP 0.3% AS EXPECTED

8:30 AM ET 9/29/06 U.S. AUG. CORE PCE INFLATION UP 0.2% AS EXPECTED

[UpInArms]

30. U.S. core inflation rises 2.5% year-on-year, 11-year high

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BAEE36514%2D87E8%2D4FCD%2D83FA%2DC80A9740669C%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- U.S. core consumer price inflation rose to an 11-year high in August as household incomes and spending rose at the slowest pace this year, the Commerce Department reported Friday. Consumer prices rose 0.2% in August, and are up 3.2% in the past year, the government said. Core consumer prices, which exclude food and energy, also rose 0.2%. The core personal consumption expenditure price index -- the key inflation gauge followed by the Federal Reserve -- has gained 2.5% in the past 12 months, the most since January 1995. Personal incomes grew 0.3% as expected in August after rising 0.5% in July. Consumer spending increased 0.1% in August after rising 0.8% in July. Economists expected spending to increase 0.2%, according to a survey conducted by MarketWatch. The report has mixed consequences for Fed policy, likely leaving the Federal Open Market Committee on course to hold its overnight interest rate target rate steady again in late October.

[OrangeCountyDemocrat]

38. Wait......I Thought Inflation Was Contained....

Didn't the Fed stop raising interest rates because inflation was under control more or less?

I'm confused. Why would the government say something that wasn't true? They must have just made a little mistake. I'm sure they'll correct it by raising rates next time around.

[Ghost Dog]

34. Dollar gains, Treasuries ease after in-line PCE

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060929:MTFH98169_2006-09-29_12-59-06_L29732796&type=comktNews&rpc=44

LONDON, Sept 29 (Reuters) - The dollar extended gains versus the euro and U.S. Treasuries erased gains on Friday after a key U.S. inflation measure rose as expected in August, suggesting that it is too soon to talk of a cut in U.S. interest rates.

The core U.S. Personal Consumption Index (PCE) -- the Federal Reserve's favoured inflation measure -- picked up to 0.2 percent on the month in August, as expected, from 0.1 percent.

The data was seen as confirming expectations that the Federal Reserve will keep interest rates at 5.25 percent next month and poured cold water on the minority view that it might cut by year-end. But further out, investors are still uncertain as to whether the next move will be a cut. "It's dollar-positive in that it could put to rest the notion that the Fed may soon lower rates. At the end of the day, I think it's consistent with a Fed that keeps a steady hand for some time to come," said Alex Beuzelin, senior market analyst at Ruesch International in Washington, D.C.

The dollar extended gains versus the euro after the PCE to hit a fresh 1-1/2 week high of $1.2640 <EUR=>.

U.S. Treasuries erased gains, with the 10-year T-note trading unchanged on the day to yield 4.620 percent <US10YT=RR>. It was 2/32 higher on the day shortly before the data. U.S. rate futures continued to point to on-hold rates for the rest of this year, with the chances of rate cut in December inching down to 13 percent from 20 percent earlier.

/...

[Ghost Dog]

42. US Midwest business strongest since July 2005

http://today.reuters.com/news/articleinvesting.aspx?type=economicNews&storyID=2006-09-29T151016Z_01_N29400127_RTRIDST_0_ECONOMY-MIDWEST-UPDATE-1.XML

NEW YORK, Sept 29 (Reuters) - Business activity in the U.S. Midwest region jumped in September to its highest in over a year, a report said on Friday, in a surprise performance which contrasted with recent signs of weakness elsewhere in the U.S. economy.

The National Association of Purchasing Management-Chicago's index surged to 62.1 in September from August's reading of 57.1. It was its highest reading since matching 62.1 in July 2005 and it outstripped even the highest forecasts.

A reading above 50 shows expansion in regional activity. The Chicago index has been above that mark for over three years.

Its strong September reading ran contrary to last week's surprising weakness in the closely watched monthly factory survey from the Philadelphia Federal Reserve.

The Chicago report's price data also helped soften some investor concerns over U.S. inflationary pressures.

Getting them there votes out...

[Ghost Dog]

43. US consumer sentiment improves in Sept-Univ. Mich.

http://today.reuters.com/news/articleinvesting.aspx?type=economicNews&storyID=2006-09-29T142732Z_01_N29267111_RTRIDST_0_ECONOMY-CONSUMERS-SENTIMENT-UPDATE-1.XML

NEW YORK, Sept 29 (Reuters) - U.S. consumers' mood brightened slightly more than expected in September, a report showed on Friday, and their inflation expectations slipped.

The University of Michigan's final reading on consumer sentiment in September was 85.4, above both an initial mid-month reading of 84.4 and August's final reading of 82, said sources who saw the subscription-only report.

The median forecast of Wall Street economists polled by Reuters was for a reading of 85. Most analysts attributed a rise in the survey to lower energy prices.

"I am not surprised that the consumer confidence is a little bit better than expected because people are seeing pump prices of gasoline come down," said James Glassman, chief U.S. economist at J.P. Morgan Chase in New York. "I am sure that is encouraging, but whether that means they spend or not, consumer confidence doesn't tell. It's more of a poll about how people feel about the world."

/...

Ah, the Goddess Gasoline explains everything...

[UpInArms]

12. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

Last trade 86.01 Change +0.24 (+0.28%)

Political Change - Which Way is the Wind Blowing in FX?

http://www.dailyfx.com/story/special_report/special_reports/Political_Change___Which_Way_1159523216522.html

As United States approaches its Congressional elections in November, political change is occurring in all of the G-3 currencies and its impact on foreign exchange trading may be far more powerful than the market appreciates. Here is a quick look at key players and possible political scenarios that may affect currency movements in the near future.

<snip>

US – Watch the Pump

On the surface President Bush and the Republican party appear to be in trouble as United States approaches its biennial Congressional elections. The President’s approval rating is mired in the lows 40’s, the Senate - long thought to be a lock for GOP - may now be vulnerable to a Democratic take over and the latest Reuters/Zogby survey of potential voters gives preference to Democrats over Republicans by 42% to 33% margin. One fear expressed by some currency analysts is the potential ascendancy of New York Congressman Charles Rangel to the chairmanship of the powerful Ways and Means committee should Democrats win the House. The Ways and Means committee controls the tax code of the United States and Congressman Rangel is a well known proponent of rollbacks of President Bush’s tax cuts. Many market players fear that a new spate of tax legislation would exacerbate the current US economic slowdown caused by the recent contraction in the housing sector.

In the Senate the situation appears even more precarious for the ruling Republican party. Democratic challengers are either ahead or close in races in five states held by the Republicans: Missouri, Montana, Ohio, Pennsylvania and Rhode Island. Furthermore the state of Virginia which only a month ago appeared to be a solid Republican strong hold may be slipping to Democratic control after incumbent Senator George Allen stumbled badly in his contest against a former Republican Jim Webb – a Vietnam vet and former Secretary of the Navy under President Reagan. Mr. Allen’s campaign has been dogged by accusations of racial insensitivity caused by Mr. Allen’s off the cuff remarks, and even possible commitment of a bias crime by his former college classmates.

Yet, despite the seeming bleakness of the Republican cause, the Democrats have not been able to close the deal. "The president and the Republicans are still on the ropes, but they certainly seem to have hit bottom and bounced back," said John Zogby the pollster. "This is still very competitive." One surprising source of support for the President and the GOP may come from the gas pump. Gas prices and Presidential approval ratings have a near perfect inverse correlation. Mr. Bush’s rating hit a nadir when gas prices skyrocketed above $3.25 per gallon but have improved considerably since the rapid decline in the cost of gasoline to an average of $2.45 per gallon. Furthermore, the recent problems of the Amaranth hedge fund which have led to much lower natural gas prices may inadvertently contribute to additional Republican strength by keeping heating bills in the coming fall and winter season far lower than expected. In short, as the saying goes, in politics a day is a lifetime and with more than month to the US election the dynamic can easily change.

...more...

[UpInArms]

23. Faster Pace by China on Rise in Currency

http://www.nytimes.com/2006/09/29/business/worldbusiness/29yuan.html?ex=1317182400&en=ca692f38a8db77ba&ei=5088&partner=rssnyt&emc=rss

HONG KONG, Sept. 28 — It’s been just days since Treasury Secretary Henry M. Paulson Jr. returned from China, but already the Chinese government has sharply stepped up the appreciation of its currency, allowing it to push through an important level against the dollar on Thursday for the first time.

The recent climb — less than a full percentage point since the beginning of September — is still modest and perhaps will not last. But it is producing cautious hope in the Bush administration that the Chinese government may be lifting its opposition to a revaluation that could ease China’s huge trade surplus with the United States.

And partly in response to the currency lift in China, two influential senators in Washington announced Thursday that they were pulling back legislation that would punish China with tariffs if it did not allow the value of its currency to rise, a step that would make exports to the United States more expensive and imports from America more competitive.

Though modest, the rise this month in the value of China’s currency, the yuan, has been at a rate more than four times the currency’s appreciation for most of the past year.

On Thursday, China’s government let the yuan push through 7.9 to the dollar, the latest in a series of daily highs that for the last two weeks has proceeded at an annualized rate of 17 percent.

...more...

[Ghost Dog]

44. Canadian dollar drops, bonds dip after data

http://today.reuters.com/news/articleinvesting.aspx?type=economicNews&storyID=2006-09-29T141559Z_01_N29305115_RTRIDST_0_MARKETS-CANADA-DOLLAR-BONDS.XML&pageNumber=1&imageid=&cap=&sz=13&WTModLoc=InvArt-C1-ArticlePage1

TORONTO, Sept 29 (Reuters) - The Canadian dollar fell against a solid greenback on Friday after a key U.S. inflation gauge came in as expected, overshadowing domestic monthly economic growth data.

Domestic bond prices dipped after the data as investors eyed the report showing the Canadian economy grew a modest, and expected, 0.2 percent in July.

At 9:55 a.m. (1355 GMT), the Canadian unit was at C$1.1185 to the U.S. dollar, or 89.41 U.S. cents, down from C$1.1108, or 90.03 U.S. cents, at Thursday's close.

"I think what you're seeing this morning is really dollar strength across the board," said Andrew Pyle, senior economist at Scotia Capital.

The greenback got a lift from the data that showed the core PCE price index for August, closely watched by the U.S. Federal Reserve, rose 0.2 percent in August as expected. The year-on-year rate rose to 2.5 percent, its highest level since April 1995.

The U.S. dollar also got a boost after Japanese consumer prices, which were closely watched for signs of whether the Bank of Japan would raise rates, met expectations. While the 0.3 percent rise in Japanese consumer prices showed the economy continues to recover, it also reinforced the view that the Bank of Japan will hold off on another rate rise until at least early next year.

/...

[Ghost Dog]

45. Gold falls below $600, vulnerable

http://today.reuters.co.uk/news/articleinvesting.aspx?type=goldMktRpt&storyID=2006-09-29T142904Z_01_L29818403_RTRIDST_0_MARKETS-PRECIOUS-UPDATE-4.XML

LONDON, Sept 29 (Reuters) - Gold prices slipped on Friday to hover below $600 an ounce, with selling driven by a dollar rise and oil price weakness.

The metal, which had jumped about five percent in a week, lacked the strength to crack key price levels in the near term, but was poised to gain strongly in the medium term, analysts said.

"Month- and quarter-end book-squaring is expected to be seen across the day. However, with oil prices stalling and the dollar edging high, gold is at risk of dipping back into the $573-$597 trading area," said James Moore, analyst at TheBullionDesk.com.

Gold <XAU=> hit a high of $603.50 before falling to $598.85/599.35 by 1416 GMT, against New York's $603.00/604.00 late on Thursday.

/...

[UpInArms]

13. Timken lowers financial outlook; plans to eliminate 700 jobs

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B04048515%2D72A4%2D4580%2D97F7%2D89D93A7DC405%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- The Timken Co. (TKR : 32.81, -1.74, -5.0% ) Friday disclosed plans for additional restructuring activities due to worsening conditions in the North American automotive industry and lowered its financial outlook. The Canton, Ohio-based maker of engineered bearings, alloy steels and other products now expects earnings of 50 to 55 cents a share for the third quarter and $2.60 to $2.75 a share for the year, excluding special items in both periods. Its previous outlook was for profits of 70 to 75 cents a share in the third quarter and $3 to $3.15 a share for 2006, excluding items. The current average estimates of analysts polled by Thomson First Call are for earnings of 75 cents a share in the September period and $3.11 a share for the year. Timken said it plans to lay off 5% of its Automotive Group workforce, eliminating roughly 700 positions. The stock finished Thursday at $32.81, down 5%.

President Discusses Plan for Economic Growth in Ohio
Timken Company
Canton, Ohio

http://www.whitehouse.gov/news/releases/2003/04/20030424-3.html

THE PRESIDENT: Thank you all, very much. (Applause.) Thanks a lot. (Applause.) Thanks for the warm welcome. I appreciate you letting me come by to say hello. (Laughter.) I'm honored to be in Canton, and I'm honored to be here at the Timken Company.

Tim was telling me that you all have been in business since 1899 -- turns out that's when William McKinley, of Canton, slept in the same room I'm sleeping in. (Laughter.) Tim told me that this is a company -- we are a "roll up your sleeves" company, a can -- it is a can-do environment. Which is one of the reasons I've got so much optimism about the future of our economy -- because of the "roll up your sleeves" attitude by thousands of our fellow Americans, because of the business sense of "we can do whatever it takes to overcome the obstacles in our way". I know you're optimistic about the future of this company. I'm optimistic about the future of our country. It's important that Washington, however, respond to some of the problems we face.

One of the problems we face is not enough of our fellow Americans can find work. There's too much economic uncertainty today. And so three months ago, I sent Congress a package that would promote job growth and economic vitality. For the sake of our country, for the sake of the workers of America, Congress needs to pass this jobs growth package soon. (Applause.)

<snip>

I appreciate the Governor of the state of Ohio for joining us today. Governor Taft, I'm honored you're here with us. (Applause.) And we've got Senator Mike DeWine with us, as well. Mike, thank you for coming. (Applause.) Congressman LaTourette, Steve LaTourette -- and Ralph Regula, as well, from the Ohio delegation. (Applause.) We got members of the state senate; we got members of the state house; we got members of the city council; we got the mayor -- we got a lot of people showing up today. (Laughter.) And I'm glad they're here. Thank you all, for taking time out of our schedules to come. (Applause.)

...more...

Lies, all lies :puke:

I do so very much hope that every GOPpiggy that was there supporting the lying liar that day get his walking papers on November 7.

[ozymandius]

14. WrapUp by Martin Goldberg

MARKET DEVELOPS SOUR SPOT

Within the context of the US stock market, in the last decade the “smart money” has been in mid-cap stocks. So with all US stocks trading at the high end of their historic valuations, it seems strikingly suspect when what was once the market’s darlings – mid caps - begin to lag the overall market significantly. Yet, that is exactly what is going on at the present time. What mutual fund marketers recently referred to as the market’s “sweet spot” has now turned into a “sour spot.” Meanwhile, the Dow is making all time highs. It makes one wonder whether the smart money is selling under the cover of bullish public sentiment and headlines.

-cut-

It would seem logical that mid caps’ performance would be somewhere in between that of small and large caps. And that is why the performance of the last three months appears to be out of whack. Whereas both small and large caps have rallied over the last three months producing gains of more than 6%, the mid caps have lagged badly, producing gains of less than 4%. Considering the 10+ years out performance of mid caps over both small and large caps, may be this is a sign of the smart money “getting out.” Over the last few months, the market seems to have developed a “sour spot” with regard to mid cap stocks.

-cut-

Today’s Market

While the Dow was up 0.25%, near an all time high, the Russell 2000 finished about even for the day and the mid caps, the apparent new market laggard, finished down 0.33%. Tomorrow is the last trading day of the quarter so you can bet there will be chicanery in the small cap sector.

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

[UpInArms]

15. Falling natural-gas, heating oil prices don't guarantee lower bills

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B01F99144%2D32F2%2D49E1%2DB208%2DD6E61959D153%7D&symbol=

SAN FRANCISCO (MarketWatch) -- Natural-gas prices have dropped to 2004 levels and heating-oil prices are trading at their lowest level in more than a year, but don't assume that'll instantly translate into lower heating-fuel costs this winter.

True, the odds more than favor the likelihood of lower prices compared with a year ago. "It looks like consumers will get a breather this winter after the record-high energy prices we experienced last year," said Ben Smith, a managing partner at First Enercast Financial, a provider of energy news and analysis.

But appearances can be deceiving. Weather is the wildcard, and the normal forces of supply and demand apply, analysts said. Remember, too, energy prices were at a record a year ago because of the production snags in the Gulf of Mexico caused by Hurricanes Katrina and Rita.

"It all depends how cold the winter is," said Jason Schenker, an economist at Wachovia Corp.

While the fourth quarter will likely see lower prices compared with last year, prices may be higher in the first quarter, he said, pointing out that last spring was actually one of the warmest in history.

...more...

[ozymandius]

17. Oil prices continue to fluctuate

LONDON - Oil prices dropped Friday in what analysts called a correction following earlier rises inspired by fears of a possible cut in OPEC output.

Light, sweet crude for November delivery fell 17 cents to $62.59 a barrel in midmorning European electronic trading on the New York Mercantile Exchange. Intraday trading Thursday took prices as high as $64 a barrel.

Brent crude futures for November on London's ICE exchange were down 38 cents at $62.16 a barrel.

In other Nymex trading, heating oil dropped 1.43 cents to $1.6995 a gallon, while unleaded gasoline futures fell 0.36 cent to $1.4975 a gallon. Natural gas futures for November delivery fell 0.4 cent to $5.388 per thousand cubic feet.

more

[ozymandius]

18. Reports: Blast at gas pipeline in Turkey

ISTANBUL, Turkey - An explosion ignited a fire on a natural gas pipeline near the Turkey- Iran border, Turkish news reports said Friday, but there were conflicting reports from the two countries about where the blast happened.

Turkey's state-run Anatolia news agency reported that the explosion occurred late Thursday night in the Iranian border city of Bazargan, citing the district head of the eastern Turkish city of Dogubayazit, Rauf Ulusoy.

The private Dogan news agency cited Turkish truckers as saying they could hear ambulances and fire engines going to the blast site, said to be about half a mile east of the Gurbulak border crossing on the Iranian side.

more

[UpInArms]

24. Crude falls as Nigeria denies it's cutting production

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B4E1AFB62%2DD781%2D4E6C%2D8C0C%2D136F6808F443%7D&symbol=

NEW YORK (MarketWatch) -- Crude-oil futures dipped early Friday after Nigeria dismissed talk it's planning to cut production from October 1 as part of an informal pact with Kuwait and Saudi Arabia to prop up falling prices.

Crude for November delivery was last down 54 cents at $62.22 a barrel in early electronic trade. The contract had another volatile session Thursday, peaking at $64 a barrel before closing lower.

Prices have been choppy this week as traders weighed supply builds against the likelihood that the Organization of the Petroleum Exporting Countries will cut production quotas.

Overnight, a Nigerian oil official was quoted in media reports as saying the world's eighth biggest oil producer is planning a 5% production cut from Oct. 1. But the reports were played down by OPEC President Edmund Daukoru, who is also Nigeria's oil minister, according to Dow Jones Newswires.

Daukoru told the agency that it would make no sense for Nigeria to cut output when it is already operating below capacity following a series of attacks on pipelines and foreign installations by a group seeking to keep more of the country's oil revenue within its borders.

...more...

[Ghost Dog]

31. Oil holds above $62, possible OPEC cut supports

Rather conflicting accounts. Is someone being leaned-on here, as in "not until after the elections?

http://asia.news.yahoo.com/060929/3/2qmfh.html

LONDON (Reuters) - Oil steadied above $62 on Friday, supported by signals that some OPEC producers may trim output to stem a price decline caused by ample U.S. inventories.

<snip>

"There is obviously enough oil flowing in the market. The inventories are at a very comfortable level and capacity has come back a notch, so the judgment is that there is more than enough supply," said Tobin Gorey at the Commonwealth Bank of Australia.

The world's eighth largest exporter Nigeria will cut supplies by 5 percent from October 1 after consultations with other OPEC producers, while some other countries in the exporters' club have already trimmed sales, acting Secretary-General Mohammed Barkindo told Reuters on Thursday.

A senior Nigerian oil industry source told Reuters that Nigeria was joining Saudi Arabia, the world's biggest oil exporter, and Kuwait in an unofficial deal to pare oil supply.

<snip>

Edmund Daukoru, OPEC's president, told Reuters earlier this week that something needed to be done to steady prices, but Kuwaiti Oil Minister Sheikh Ali al-Jarrah al-Sabah countered that with U.S. crude above $61, most OPEC ministers were content with prices and not inclined now to cut output.

/...

Also notice, from the above DJ report:

<snip>

In any case, "saying you are going to cut output and actually doing it are two different things; this may explain the market's healthy dose of skepticism when it comes to OPEC pronouncements," said Edward Meir, analyst at Man Financial.

Meir is expecting crude to remain under pressure from the same factors that have pulled it from its peak around $78 a barrel earlier this year, namely, slowing U.S. economic growth, healthy inventories and a continued unwinding of the Iran premium.

"We are probably in a minority camp right now, believing that the Iranians will eventually reach a compromise with the West, and that this would be the next shoe to drop as far as the markets are concerned," he said. "OPEC, for the moment, seems to not be fully in the picture, as barring a Saudi cut, which has, we think, the most credibility within the cartel, markets will treat most of the other policy pronouncements with some suspicion."

Does he mean that the US may reach a compromise on its own Iran policy?

[Ghost Dog]

28. INPEX waits as Iran-set Azedegan deadline looms

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060929:MTFH90717_2006-09-29_07-07-06_T331949&type=comktNews&rpc=44

TOKYO, Sept 29 (Reuters) - INPEX Holdings Inc. (1605.T: Quote, NEWS, Research) said it was not aware of a deadline to finalise a deal to develop Iran's giant Azadegan oilfield, although Tehran has suggested it would do it itself without a deal by Friday.

A spokesman for INPEX, Japan's biggest oil explorer, said it has been making preparations to start work there promptly once the Iranian side completes a mine-clearing mission, but added it did not know how long that work will take. Asked if Iran had notified the Japanese company of a deadline, the spokesman said, "That is not the case." The spokesman added INPEX has no plans to make any announcement on the deal by the end of Saturday.

Resource-poor Japan has rights to the giant Azadegan oilfield but talks have stalled since the deal was signed in 2004, when the project was thought to require an investment of $2 billion.

Iran's Oil Minister Kazem Vaziri-Hameneh said this week INPEX Holdings had until Friday to finalise the deal or Tehran will develop the field itself. "We should wait until Friday for the Japanese (company's) stance regarding Azadegan oilfield to become clear," Hamaneh was quoted as saying this week by the Oil Ministry's official Web site SHANA. "The development of the (Azadegan) field will begin by means of domestic capabilities if the answer of the Japanese side is negative," he said. "We prefer to develop this field ourselves."

Japan's newly appointed trade minister Akira Amari said on Wednesday that talks between Japan and Iran over the development project in the oilfield appear to be hitting a dead end, but that the negotiations should continue past the end-September deadline.


/...

[Ghost Dog]

35. Who's Keeping Oil Down?

http://www.financialsense.com/editorials/casey/2006/0928.html

<snip>

So, what happened? Mainstream financial media blamed crude’s tumble on everything from Iran playing nice with the U.S. to a so far hurricane-less hurricane season in the U.S. Gulf of Mexico. But any intelligent observer can see that the fall was too hard and too sudden to be caused by these factors alone.

More than anything, this sell-off looked like it was caused by seasonal and technical factors. Crude is almost always weak in the fourth quarter, and the price had gotten ahead of itself in recent months—not surprising, given Israel and Lebanon going to toe-to-toe.

But the timing of oil’s decline also coincides with another event: U.S. mid-term elections. Although these two things sound unrelated, oil and politics in fact go hand in hand. In fact, there is an eye-opening correlation between U.S. president George Bush’s popularity and American gasoline prices over the past four years. As the chart below shows, the higher the price at the pump, the more people think of Bush as a chump.

Which begs the question: with elections looming, might the Republicans be trying to bring down oil prices (and therefore gasoline costs) in an attempt to cull favor at the polls?

While we’re generally skeptical of conspiracy theories (after all, if the government can’t deliver mail on time, how could it organize a large-scale covert action?), it’s a known fact that the feds have several mechanisms by which they could nudge crude lower.

The Strategic Petroleum Reserve, for one. Release of crude from this stockpile helped push oil prices lower last fall in the wake of hurricanes Katrina and Rita.

Another lesser-known influence on oil prices is the “crack spread.” This is the difference between the price that oil refiners pay for crude and the price they receive for the gasoline they produce. Put another way, it’s the profit margin that refiners make on their products.

Currently, the crack spread is at—in the words of the U.S. Energy Information Administration—“unusually low levels.” This means that refiners are selling gasoline for little more than the cost of the oil they purchase. This makes no sense from a business perspective… generally in such a situation, refiners would simply up the sales price of their gasoline, improving their margins.

However, it does make sense if the refiners are purposely attempting to keep a lid on prices.

/...

[Ghost Dog]

51. Why Oil Prices Are Falling

DU / tomdispatch here: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x237580#237586

[Ghost Dog]

55. Will the price of oil continue to fall?

http://english.people.com.cn/200609/29/eng20060929_307600.html

Since early August, the international crude oil price has decreased from US$77 per barrel to below $60 early this week. The former chief of OPEC predicts that the oil price may fall to $40 per barrel, the cost 8 years ago.

The price of crude oil price has been increasing since 1998. Just before August it increased sharply before falling just as rapidly. Generally oil price fluctuations should be compatible with long-term investment in oil production. A sudden increase or decrease in oil prices is related to international opportunistic investment ¨C when a significant opportunist fund makes a purchase, the price will suddenly increase. If it withdraws its funds the price of oil will fall sharply. It has been estimated that when the oil price is above $70 per barrel, at least 30 dollars of that is floating money. According to market demand and supply, the price of oil will settle after a sharp increase.

<snip>

Some people think the US will change its oil price and dollar policy. The US may take measures to force down the oil price and weaken countries like Venezuela and Iran as well as halt the rise of Russia.

Some oil producers and consumers have adjusted their policy on energy by either increasing their investment in oil extraction or finding alternative energy resources to put pressure on the price of oil.

The discovery of new oil fields has caused people to expect lower oil prices. The US has discovered a new oil field in the Mexican Gulf. It's expected that the amount of oil in storage in the US will double because of this field. This will push down world oil prices.

The pressure in international 'hot spots', such as Iran, has decreased, and even if some countries do impose sanctions on Iran, they will not be related to the export of oil.

It is predicted that this northern winter will be a warm one, so the demand for oil will not be as high as expected.

It remains to be seen whether or the current low price of oil will last. After all, oil is a strategic material and limited resource that is in great demand. There is a lot of extra money in the world financial market but few products worthy of investment, so oil remains an important area of investment. It is unlikely that the price of oil will drop back to what it was 8 years ago. In the long run, the conflict between supply and demand will only be eradicated by a breakthrough in alternative energy resources. Based on the current technology, only when the price of oil is above $40 per barrel, will coal conversion technology have a commercial future. Other emerging technologies will take time to perfect. Therefore, the opinion of the mainstream is that the price of oil will fluctuate between $40 and $60 per barrel in the current international political and economic environment.

By People's Daily Editor Huang Qing and translated by People's Daily Online

[Ghost Dog]

41. More on the Great Game for strategic resources

THE HUNGRY BEAR
PART 3: No more Mr Nice Guy
http://www.atimes.com/atimes/Central_Asia/HI27Ag01.html
By W Joseph Stroupe

<snip>

East and West are now irreversibly locked in a monumental struggle for control of the globe's coveted strategic resources - this is the revived Great Game and its players are rapidly approaching the moment of truth. The stakes for both sides are
colossal and both sides fully recognize that fact. However, neither side likes to admit explicitly the existence of such a struggle that will define which side achieves global ascendancy and which side faces the potential of an energy-based economic checkmate.

The United States prefers to strive for advantage in the Great Game while hiding behind the veil of the ostensibly noble policy of spreading "freedom" and "democracy" - yet it is active in such a policy primarily only in countries that are either rich in strategic resources or are strategically located as respects the export of such resources. By military invasion and occupation, by encirclement through proliferation of its military bases, by the spread of "colored" revolutions, by sponsoring oil and gas pipelines that circumvent Russia and its partners, and by various diplomatic drives, the West attempts to roll back Russian control over resources and to consolidate its own.

Russia and the East prefer to make advances in the Great Game while simultaneously and fervently denying any interest whatever in locking up the bulk of the globe's strategic resources and thereby winning the game - yet virtually every diplomatic and economic move on the part of Russia and the East is obviously targeted at and designed incrementally and insidiously to accomplish that very goal, and rapid progress is being made toward that very end.

<snip>

In the Great Game the loser will forfeit virtually everything of value, or will be held backward on its heels in a position where there is no escape from the threat of such forced forfeiture. If Russia loses the game, then the West, sitting in de facto control of massive reserves of oil and gas around the globe, will be sufficiently able to control the global price and availability of oil to bring the price down to a point where Russia's economy will begin to falter, or worse.

Of course, a win by the West at this late date in the Great Game would take much more than a Hail Mary pass. <1> However, the West in general and the US in particular will never willingly forfeit the game, even though the odds are massively against it now. The game will be played out to its finish and the US will stop at nothing to pull out a win, even at the last moment if possible.

/more...

[UpInArms]

19. Amaranth: Betting on the Weather and Taking an Ice-Cold Bath

http://www.nytimes.com/2006/09/29/business/29insider.html?ex=1317182400&en=a52cafa47b1124ae&ei=5088&partner=rssnyt&emc=rss

There’s a lot of talk about lessons learned from the evaporation of $6 billion of capital at Amaranth Advisors in Greenwich, Conn.

<snip>

The bet was that the spread between the two months would widen. The rationale was reasonable: Amaranth anticipated the price of the March contract would rise (March is the last month of winter and higher demand would result in higher prices) and April prices would fall, as summer approached and more supply led to lower prices.

The spread between the March and April futures contracts for 2007 was $2.49 during the last week of August. By Sept. 15, it fell to $1.15, more recently tumbling to 58 cents. Contracts for March-April bets in 2008 and 2009 — contracts that tend to be less volatile — also widened, wreaking havoc on the fund’s portfolio.

<snip>

“As a one-day move it was very surprising,” said Hilary F. Till, a principal at Premia Capital. “But that the spreads would come in is not an unusual event. You could look at where the spreads traded pre-2004 and see that they are quite wide compared to historical levels.”

...more...

:think:

[UpInArms]

20. Car Parts Maker Fires Officers After Inquiry (errors in 2001 thru 2005)

http://www.nytimes.com/2006/09/29/business/29parts.html?ex=1317182400&en=e28cf56f4a2dc4d0&ei=5088&partner=rssnyt&emc=rss

The CSK Auto Corporation, an auto parts retailer, dismissed its chief operating officer and its chief administrative officer yesterday and said its chief executive was retiring after an accounting investigation identified errors that would lead to restatements of financial results.

<snip>

The accounting investigation, completed by the company’s audit committee, focused primarily on accounting for inventory and vendor allowances and found errors and irregularities that “materially and improperly” affected several inventory and expense accounts, CSK said.

The government has not been in contact with the company about its internal investigation, a spokesman, Mike Banas, said. He added that there was “no indication” that Mr. Jenkins figured in the investigation.

CSK will restate either its financial statements or select financial data for results from fiscal year 2001 through the first three quarters of fiscal 2005, the company said. The company is restating as much as $89 million of inventory and vendor allowances that were overstated, Mr. Banas said.

...more...

[UpInArms]

21. Pirate Capital Hedge Fund Shrinks Staff and Faces S.E.C. Inquiry

http://www.nytimes.com/2006/09/29/business/29hedge.html?ex=1317182400&en=f6e2dc987a5d1325&ei=5088&partner=rssnyt&emc=rss

Pirate Capital, a hedge fund that takes pride in attacking management at underperforming companies, now finds itself under fire.

Pirate Capital, a $1.7 billion fund based in Norwalk, Conn., lost half its investment team this week, according to a letter from the founder and portfolio manager, Thomas Hudson. In addition, Pirate, an “activist” fund that pressures management to increase shareholder value, is being investigated by the Securities and Exchange Commission on suspicion of failing to alert the commission when it was selling stock, according to one person briefed on the inquiry.

Mr. Hudson’s letter, dated Sept. 28 and on stationery with a pirate ship logo, said that Pirate would close to new investors Sunday, to focus on delivering returns rather than collecting more money.

<snip>

Pirate is known for its unusually brash tactics and unabashed style. A New York magazine cover article reported that Zachary George, 27, an analyst with the firm and former competitive snowboarder, told the chief executive of the Cornell Companies, a prison operator, that “You work for us,” and that Mr. George and Pirate wanted Cornell sold and the chief executive sacked. “Next year we’re going to be here, and you won’t,” Mr. George told the chief executive, according to the article.

...more...

[UpInArms]

22. U.S. Fugitive in Comverse Options Case Displeased by His African Jai

http://www.nytimes.com/2006/09/29/business/29fugitive.html?ex=1317182400&en=b2049049b9015475&ei=5088&partner=rssnyt&emc=rss

excerpt:

Appearing unshaved and wearing a black leather jacket, Mr. Alexander, 54, seemed calm at a hearing on his application to be released on bail. The proceeding was postponed until Monday to allow his local lawyers more time to prepare.

<snip>

His new surroundings are a vast difference from the Windhoek Country Club Resort and Casino, which he has apparently called home since he, his wife and three children entered the country late in July.

<snip>

Chief Inspector William Lloyd said Mr. Alexander remained calm when a preliminary warrant from the Justice Department, forwarded to the local Interpol office, was read to him. “But he got very nervous when we handcuffed him,” Inspector Lloyd recalled. “He could see there was something serious coming at him.”

...more...

[UpInArms]

25. Ford Motor Credit to cut 2,000 jobs

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=businessNews&storyID=2006-09-28T223848Z_01_WEN6102_RTRUKOC_0_US-AUTOS-FORDMOTORCREDIT.xml

DETROIT (Reuters) - Ford Motor Credit, the financial arm of Ford Motor Co. (F.N: Quote, Profile, Research) on Thursday said it would cut 2,000 jobs -- almost a quarter of its staff in North America -- and close 59 U.S. branch offices over the next year in order to cut costs.

The job cuts come in addition to Ford's plans to cut a total of 14,000 salaried jobs from its loss-making North American auto operations as it works to adjust to a declining share of the U.S. market for cars and trucks.

Analysts said the latest job cuts showed Ford was working to cut costs across its operations in response to the pressure for the automaker to do more to engineer a turnaround.

"There really is no choice but to do a full court press on every aspect of their costs," said David Cole, chairman of the Center for Automotive Research.

Ford Motor Credit said its job cuts would be made through a combination of attrition, early retirements, voluntary separations and, if necessary, involuntary separations.

...more...

[Ghost Dog]

26. Sony scrambles to contain growing battery troubles

http://www.afp.com/english/news/stories/060929025344.rqdb49yg.html

TOKYO (AFP) - Japan's Sony, scrambling to contain the fallout from widening defective battery problems, has launched a global replacement program after China's Lenovo became the latest computer maker to issue a recall.

Sony will offer to replace certain battery packs for notebook computers in response to concerns over recent overheating incidents, the Japanese electronics giant announced in the United States late Thursday.

"This is a program to ease the worries of computer makers and consumers," said Sony spokesman Takashi Uehara in Tokyo.

"This is not a compulsory recall," he said, adding it was not yet clear how many laptop computer batteries might be returned.

The program could develop into the largest-ever recall of computer batteries by any company, according to Japanese media.

Analysts said it was hard to quantify the potential magnitude and cost of the problem but believed it so far looked manageable for Sony, which has recently rebounded under a major restructuring plan.

/...

[Ghost Dog]

27. US fast-food chains sued over carcinogenic chicken

http://www.afp.com/english/news/stories/060928222833.8wfh02pp.html

WASHINGTON (AFP) - A US doctors' group sued seven leading fast-food chains including McDonald's and Burger King over their use of a "dangerous carcinogenic" in grilled chicken.

The Washington-based Physicians Committee for Responsible Medicine (PCRM) filed suit in California "to compel the restaurants to warn unsuspecting consumers" through in-store posters and menu messages.

The group said every sample of grilled chicken products from the seven national chains "tested positive for a dangerous carcinogenic compound called PhIP" during analysis at an independent laboratory.

PhIP is one of a group of carcinogenic compounds called heterocyclic amines (HCAs) that are found in grilled meats. In 2005, the US government officially added HCAs to its list of cancer-causing agents, the doctors' group said.

"Grilled chicken can cause cancer, and consumers deserve to know that this supposedly healthy product is actually just as bad for them as high-fat fried chicken," PCRM president Neal Barnard said in a statement.

<snip>

Aside from McDonald's and Burger King, the chains named in the lawsuit were Chick-fil-A, Chili's, Applebee's, Outback Steakhouse and TGI Friday's.

The California Restaurant Association, which represents the major chains in the richest US state, dismissed the doctors' lawsuit as groundless and politically motivated.

/...

[Ghost Dog]

36. Off and running, contrariwise?

Was 10 minutes ago:

Dow 11,713.89 Down 4.56 (0.04%)
Nasdaq 2,269.31 Down 0.71 (0.03%)
S&P 500 1,338.67 Down 0.48 (0.04%)
10-Yr Bond 4.6100% Down 0.0160
NYSE Volume 106,501,000
Nasdaq Volume 105,769,000

Now is:

Dow 11,721.89 Up 3.44 (0.03%)
Nasdaq 2,268.18 Down 1.84 (0.08%)
S&P 500 1,338.91 Down 0.24 (0.02%)
10-Yr Bond 4.6080% Down 0.0180
NYSE Volume 134,454,000
Nasdaq Volume 129,701,000

09:00 am : S&P futures vs fair value: +0.9. Nasdaq futures vs fair value: +2.0. Futures indications continue to improve heading into the open, offering a slightly positive disposition for stocks. Given the current bullish underlying tone to the market and the core-PCE reflecting a slight moderation from the previous trend, it appears the Dow will make another run at its all-time closing record. Showing even more momentum, though, is the Nasdaq, which is getting a big lift from Research In Motion (RIMM) after it topped expectations last night and forecasted continued strong subscriber growth.

[Ghost Dog]

37. 10:30, um, flatlining?

Dow 11,721.33 Up 2.88 (0.02%)
Nasdaq 2,269.28 Down 0.74 (0.03%)
S&P 500 1,337.93 Down 1.22 (0.09%)
10-Yr Bond 4.6330% Up 0.0070
NYSE Volume 472,763,000
Nasdaq Volume 404,091,000

10:00 am : In similar fashion to yesterday's early trading action, the Dow briefly eclipses its all-time closing high of 11,722.98 but runs into a wall of resistance, prompting investors to rethink holding on to recent gains going into the weekend. Even though market losses are modest at best, the absence of sector leadership across the board further underscores the market's struggles to keep the September rally intact, especially during what is historically the worst month of the year for stocks.DJ30 -4.54 NASDAQ -3.81 SP500 -1.02 NASDAQ Dec/Adv/Vol 1070/1242/159 mln NYSE Dec/Adv/Vol 1153/1441/68 mln

09:40 am : Stocks open with little fanfare as this morning's steady inflation data so far are not providing investors with enough conviction that the Fed will remain patient with its tightening policy. Earlier, the Commerce Dept. showed that the core-PCE deflator rose just 0.2%, in line with forecasts and reflecting a slight moderation from the previous trend. Nonetheless, the market at this point remains reluctant to extend recent gains since the Fed's favored inflation gauge now stands at an 11-year high as personal spending rose at the slowest pace (+0.1%) this year.DJ30 -7.32 NASDAQ +0.24 SP500 -0.53 NASDAQ Vol 102 mln NYSE Vol 70 mln

[Jemmons]

39. The nordic semi-socialist model is competetive - US less so

From the World Economic Forum
The Global Competitiveness Report 2006-2007: Country Highlights

"...The Scandinavian countries remain among the top
performers, with Finland, Sweden, and Denmark occupying
second, third and fourth places, respectively.They share
with Switzerland a broadly similar institutional and structural
profile.The Nordic countries have better ranks on the
macroeconomy pillar of the GCI, since they are all running
budget surpluses and have lower levels of public indebtedness
than Switzerland and, indeed, much of the rest of
Europe. Finland and Sweden have the best institutions in
the world (ranked 1 and 2, respectively) and occupy places
in the top ten ranks in health and primary education.


These three Nordic countries also occupy the top three
positions in education and training, where Finland’s rank
of 1 is remarkable for its durability over time.They lag
behind Switzerland in the areas of labor market flexibility
and, to a lesser extent, in indicators of business sophistication.
The Nordic countries show that transparent institutions
and excellent macroeconomic management, coupled with
world class educational attainment and a focus on technology
and innovation are a successful strategy for maintaining
competitiveness in small, highly developed economies.
The United States is ranked sixth this year. It remains
a world leader in a number of key categories assessed by
the GCI, such as market efficiency, innovation, higher
education and training, and business sophistication.
However, growing imbalances have dented a number of
macroeconomic indicators, and the levels of efficiency and
transparency underpinning its public institutions do not
match those of the most developed industrial countries."




http://www.weforum.org/en/fp/gcr_2006-07_highlights/index.htm

[Ghost Dog]

53. Education, education, education

For all. n/t

[Ghost Dog]

46. 12 Noon on the flat

Dow 11,725.10 Up 6.65 (0.06%)
Nasdaq 2,272.54 Up 2.52 (0.11%)
S&P 500 1,338.92 Down 0.23 (0.02%)
10-Yr Bond 4.6430% Up 0.0170
NYSE Volume 881,379,000
Nasdaq Volume 767,888,000

12:00 pm : Like Fed policy being "in a range that can be considered neutral," as noted by St. Louis Fed President Poole earlier, so too are stocks stuck in a rut midday still vacillating around the unchanged mark.

The sense of reserve on the part of investors is largely attributed to concerns about the sustainability of a stock rally that has the Dow above its all-time closing high and the Nasdaq poised for its best September since 1998 to mixed economic data. To wit, while the core-PCE deflator rose just 0.2% in August, matching economists' forecasts and reflecting a slight moderation from the previous trend, the data also leave the Fed's favored inflation gauge at an 11-year high while personal spending rose at its slowest pace (+0.1%) this year.

That report, coupled with an unexpected rise in Midwest manufacturing and candid comments from Poole concerning inflation and "pretty stable" growth, have fueled further consolidation in Treasuries and lifted yields across the curve -- another issue being used as an excuse for stock investors to lock in recent gains. With growth concerns being the market's pre-occupation of late, the Chicago PMI checking in at 62.1 in September -- its best reading this year, has trumped last Thursday's disappointment from the Philly Fed and eases concerns that manufacturing activity was entering a downturn. Nonetheless, investors may be waiting for Monday's national ISM Index, the most influential of all the manufacturing surveys, to offer a clearer picture of economic growth.

The absence of influential sector leadership also poses a problem for the bulls struggling to extend the market's winning streak to five days. Unlike yesterday when notable strength in a handful of Dow components (e.g. GM, INTC, CAT, HPQ

11:30 am : Indices continue to languish below the flat line but market losses remain minimal and, according to market internals, there still isn’t a lot of conviction on the part of sellers. As reflected in the A/D line, advancers and decliners on both the NYSE and Nasdaq remain evenly matched, with only a slight edge going to the declining issues. The ratio of up to down volumes also paints a similarly neutral picture at the Big Board and the Composite. DJ30 -7.09 NASDAQ -2.42 SP500 -1.56 NASDAQ Dec/Adv/Vol 1456/1337/602 mln NYSE Dec/Adv/Vol 1544/1425/420 mln

11:00 am : Stocks still can't seem to gain much traction as the temptation to take some money off the table following such an impressive run-up holds precedence. On a positive note, oil prices are back below $62 a barrel (-1.3%) amid ongoing speculation OPEC may start reducing output, which extends the commodity's monthly decline to more than 13%. However, since oil's pullback also questions the Energy sector's ability to keep generating strong earnings for the S&P 500, the absence of leadership from the likes of Drillers and Refiners is preventing the bulls from taking notice. DJ30 -7.44 NASDAQ -2.20 SP500 -1.69 NASDAQ Dec/Adv/Vol 1420/1290/485 mln NYSE Dec/Adv/Vol 1559/1369/330 mln

10:30 am : Market spikes to session highs within the last 30 minutes after investors digest manufacturing data that trumps last Thursday's disappointment from the Philly Fed. With growth concerns being the market's pre-occupation of late, the Chicago PMI checked in at a solid 62.1 in September, up from 57.1 in August. Since the PMI has the highest correlation with the most influential of all manufacturing surveys -- Monday's national ISM Index, the highest PMI reading in a year has eased concerns spurred by other regional surveys (i.e. Philly Fed and Richmond) that manufacturing was entering a downturn. Be that as it may, very candid commentary about Fed policy from St. Louis Fed President Poole coming out at the same time as a delayed University of Michigan sentiment revision has left investors with an overload of information and so far stalling the recent recovery. DJ30 +5.59 NASDAQ +0.40 SP500 -0.84 NASDAQ Dec/Adv/Vol 1288/1306/360 mln NYSE Dec/Adv/Vol 1441/1421/228 mln

[Ghost Dog]

54. Hanging on at 2pm (Yawn)

Dow 11,710.53 Down 7.92 (0.07%)
Nasdaq 2,269.91 Down 0.11 (0.00%)
S&P 500 1,338.80 Down 0.35 (0.03%)
10-Yr Bond 4.6510% Up 0.0250
NYSE Volume 1,349,098,000
Nasdaq Volume 1,161,628,000

2:00 pm : More of the same for stocks as split industry leadership continues to dictate today's lackluster trading action. To wit, IT Consulting Services (+1.8%) and Computer Hardware (+1.1%) are today's top two performing S&P industry groups, but consolidation in semiconductors has stalled renewed enthusiasm for the tech sector. Maxim Integrated Products (MXIM 27.96 -0.78) becoming the latest chip maker to receive a Nasdaq delisting letter and analysts cutting their estimates for Teradyne (TER 13.29 -0.36) are among the biggest reasons behind semiconductor weakness. DJ30 -17.13 NASDAQ -0.59 SOX -0.5% SP500 -0.82 NASDAQ Dec/Adv/Vol 1482/1462/1.13 bln NYSE Dec/Adv/Vol 1620/1535/792 mln

1:30 pm : Sellers show some resolve within the last 15 minutes, removing modest leadership from a few key sectors. Joining Industrials to the downside, as reflected in the Dow showing the most noticeable retreat, have been Tech and Financials, which have recently slipped into the red. All in all, though, the market is still holding up considerably well since the three major indices are up roughly 2.0% on average this week and market losses are still minimal.DJ30 -20.15 NASDAQ -1.45 SP500 -1.31 NASDAQ Dec/Adv/Vol 1447/1496/1.02 bln NYSE Dec/Adv/Vol 1531/1583/702 mln

1:00 pm : The major averages continue to vacillate in roughly the same ranges. To put things in perspective with respect to the lack of conviction today, consider that the S&P 500 has essentially traded in a 2-point range all day. As has been the case since the start of the session, Hewlett-Packard (HPQ 36.99 +1.02) sits atop the Dow's list of winners, but 19 out of 30 components still posting losses leaves the Dow in jeopardy of closing out Q3 at a new all-time high.DJ30 -5.94 NASDAQ +0.95 SP500 -0.63 NASDAQ Dec/Adv/Vol 1446/1448/940 mln NYSE Dec/Adv/Vol 1535/1560/650 mln

[Ghost Dog]

56. How Now Brown Dow

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x2851019

(Good talking point. It's the economy stupid. Just don't mention Greenspew).

[Ghost Dog]

57. Slipsliding into the final hour

Dow 11,694.04 Down 24.41 (0.21%)
Nasdaq 2,265.31 Down 4.71 (0.21%)
S&P 500 1,336.88 Down 2.27 (0.17%)
10-Yr Bond 4.6370% Up 0.0110
NYSE Volume 1,607,869,000
Nasdaq Volume 1,363,654,000

3:00 pm : The market is trudging along, fighting to keep losses to a minimum. Thus far, it has been somewhat successful thanks to the support provided by large-cap issues. Strikingly, on a quarter-to-date basis, it is the Dow Jones Industrial Average (+4.9%) that holds a noticeable edge over the Russell 2000 (+0.9%) as concerns that growth slowing to sustainable-trend-like levels makes small-cap stocks less attractive. As a reminder, at the end of the first quarter the Russell 2000 was up 13.7% versus a gain of just 3.7% for the Dow. DJ30 -11.12 NASDAQ -1.83 R2K -0.2% SP500 -0.44 NASDAQ Dec/Adv/Vol 1500/1495/1.32 bln NYSE Dec/Adv/Vol 1565/1621/946 mln

2:30 pm : Stocks continue to trade sideways as investors find few catalysts to push the indices in either direction. The market's holding pattern continues to be evidenced in the A/D line, especially on the Nasdaq where advancing and declining issues have been evenly matched all afternoon. Research In Motion (RIMM 102.59 16.53) remains the Nasdaq 100's biggest standout, but its 19% surge continues to be offset by weakness in a handful of other tech names as well as losses in retail (e.g. BBBY -1.0%, SHLD -1.7%). DJ30 -11.10 NASDAQ -1.62 SP500 -0.88 NASDAQ Dec/Adv/Vol 1496/1467/1.21 bln NYSE Dec/Adv/Vol 1548/1613/856 mln

[Ghost Dog]

58. 3:48 Into the final minutes and rolling over

Dow 11,683.07 Down 35.38 (0.30%)
Nasdaq 2,258.61 Down 11.41 (0.50%)
S&P 500 1,335.77 Down 3.38 (0.25%)
10-Yr Bond 4.6330% Up 0.0070
NYSE Volume 1,897,118,000
Nasdaq Volume 1,595,974,000

3:30 pm : The bears make one final attempt to get in the last word before the third quarter comes to an end. Since the last update, a renewed wave of selling interest has pushed all three majors to their lowest levels of the session. Some short covering in oil prices ahead of the weekend, erasing a 2.1% pullback to close the commodity in positive territory, has contributed to some of the recent pullback as has a sense that stocks simply look overbought at current levels after a surprisingly strong September resulting in an impressive third quarter altogether. DJ30 -24.67 NASDAQ -5.29 SP500 -1.66 NASDAQ Dec/Adv/Vol 1599/1389/1.44 bln NYSE Dec/Adv/Vol 1702/1511/1.04 bln

[Ghost Dog]

59. And it's a fine, fine Friday third quarter close

Dow 11,679.07 Down 39.38 (0.34%)
Nasdaq 2,258.43 Down 11.59 (0.51%)
S&P 500 1,335.84 Down 3.31 (0.25%)
10-Yr Bond 4.6330% Up 0.0070
NYSE Volume 2,171,517,000
Nasdaq Volume 1,763,063,000

(Blah to follow.)

---

Note: plenty of volume in the final falling minutes... and still rising, but the indices themselves seem stable now.

Ok, I'm heading below to put the pasta, cheese and veg in the oven, whip up a homegrown herb, tomato and rocket salad for my depressed girlfriend who's due home any time soon. Play some Leonard Cohen.

Have a useful weekend, folks, and don't forget Oct. 5th. I'm away next week. :hi:

[Ghost Dog]

60. Final volume, blah

NYSE Volume 2,201,361,000
Nasdaq Volume 1,879,051,000

4:20 pm : Stocks snapped a four-day winning streak Friday, but a little profit taking on a light volume day did little to tarnish such a strong performance during what is historically the worst month of the year for stocks and a seasonally weak quarter. All three major indices finished lower on the day but up 2.0%, 2.8% and 4.6% on average for the week, month and third quarter, respectively.

After the Dow briefly eclipsed its all-time closing high of 11,722.98 early on to stay on pace for its best Q3 performance since 1995, a feeling of vertigo set in that kept the major averages stuck in a relatively tight trading range throughout most of the session. That is until a late-day reversal in oil prices, which erased a 2.1% pullback to close the commodity in positive territory, and last-minute rebalancing added some volatility that exacerbated concerns about the sustainability of the recent run-up in stocks.

Before the bell, the Commerce Dept. showed that the core-PCE deflator rose just 0.2% in August, matching economists' forecasts and reflecting a slight moderation from the previous trend. Nonetheless, since the data also left the Fed's favored inflation gauge at an 11-year high, as personal spending rose at its slowest pace (+0.1%) this year, the market became reluctant to extend recent gains.

Since investors continue to be pre-occupied with the pace of economic growth, the market was also in a holding pattern until the release of the Chicago PMI at 10:00 ET, which checked in with a solid reading of 62.1 for September -- its best reading this year. However, even though the data trumped last Thursday's disappointment from the Philly Fed and eased fresh concerns that manufacturing activity was cooling off as well, the report took a backseat to the anticipated release of Monday's more influential national ISM Index and some very candid Fed-speak about monetary policy. While St. Louis Fed President William Poole introduced the prospect of a possible easing, which the Treasury market has been pricing in for months now, an added remark that it will take a rapid slowdown for policy makers to cut interest rates removed more of the optimism behind the market's recent rally.

The absence of influential sector leadership also posed a problem for the bulls. Unlike yesterday when notable strength in a handful of Dow components (e.g. GM, INTC, CAT, HPQ) helped the blue-chip index finish within five points of its all-time closing high, Hewlett-Packard (HPQ 36.70 +0.73) was among today's only bright spots on the Dow as investors applauded Congressional testimony given by CEO Mark Hurd and HPQ's entry into the lucrative video game market with the announced acquisition of Voodoo Computers. BTK -0.2% DJ30 -39.38 DJTA -0.3% DJUA -1.0% DOT +0.4% NASDAQ -11.59 NQ100 -0.5% R2K -1.0% SOX -1.2% SP400 -0.6% SP500 -3.30 XOI +0.4% NASDAQ Dec/Adv/Vol 1793/1233/1.73 bln NYSE Dec/Adv/Vol

[TrogL]

61. Feds Give Mortgage Guidance to banks

http://www.wtop.com/?nid=111&sid=918889

These mortgages are appealing to people who need cash for other expenses or who in recent years have been struggling with rapidly rising home prices.


But these types of loans also expose borrowers to far greater risks. If housing prices drop, their loan could be worth more than their property. If interest rates rise, their loan will become expensive to pay.


Former Federal Reserve Chairman Alan Greenspan issued a number of warnings about these loans last year and other banking regulators have as well.

Also discussed here http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2536817