STOCK MARKET WATCH, Wednesday November 1

[ozymandius]

Wednesday November 1, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 810 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2135 DAYS
WHERE'S OSAMA BIN-LADEN? 1841 DAYS
DAYS SINCE ENRON COLLAPSE = 1802
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 October 31, 2006

Dow... 12,080.73 -5.77 (-0.05%)
Nasdaq... 2,366.71 +2.94 (+0.12%)
S&P 500... 1,377.94 +0.01 (+0.00%)
Gold future... 606.80 -0.60 (-0.10%)
30-Year Bond 4.72% -0.07 (-1.40%)
10-Yr Bond... 4.61% -0.07 (-1.43%)






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

[ozymandius]

1. WrapUp by Ike Iossif

WEEKLY CHARTS

-lotsa charts-

SUMMARY

For last week we said, "The indices remained in a "state of suspended animation" during OPEX week--as we had suspected. For next week the odds favor a retreat, but we won't have confirmation of it until we have a close below 1357 for the SP and below 2325 for NASDAQ. On another note, we would like to issue an alert for a BUY SIGNAL on gold/gold stocks that may come during the first 2-3 trading days of the week.

This week, given last week's price action, the two most likely scenarios are shown in the illustrations below. Basically the pattern suggests that either:

a) Friday's decline will be extended by another 1%-1.2%, but it will be followed by another run to the upside (see scenario#1). In that case, the 2325 level for NASDAQ and the 1370/65 level for the SP should provide support triggering an upside reversal by no later than Tuesday.

b) Friday's decline will continue down to the first downside targets (see table below), but it too will be followed by another run towards the most resent highs (see scenario#2). In that case, the 2300 level for NASDAQ and 1360/55 level for the SP should provide support triggering an upside reversal by week's end.

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

[ozymandius]

2. Today's reports-a-plenty

12:00 AM Auto Sales Oct
Briefing Forecast 5.2M
Market Expects 5.3M
Prior 5.3M

12:00 AM Truck Sales Oct
Briefing Forecast 7.2M
Market Expects 7.4M
Prior 7.6M

10:00 AM Construction Spending Sep
Briefing Forecast 0.1%
Market Expects 0.0%
Prior 0.3%

10:00 AM ISM Index Oct
Briefing Forecast 54.0
Market Expects 53.0
Prior 52.9

10:30 AM Crude Inventories 10/27
Briefing Forecast NA
Market Expects NA
Prior -3205K

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

[ozymandius]

17. many reports in

8:30 AM Personal Income Sep
Actual 0.5%
Briefing Forecast 0.4%
Market Expects 0.3%
Prior 0.4%
Revised From 0.3%

8:30 AM Personal Spending Sep
Actual 0.1%
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.2%
Revised From 0.1%

8:30 AM Employment Cost Index Q3
Actual 1.0%
Briefing Forecast 0.8%
Market Expects 0.9%
Prior 0.9%

10:00 AM Chicago PMI Oct
Actual 53.5
Briefing Forecast 58.0
Market Expects 58.0
Prior 62.1

10:00 AM Consumer Confidence Oct
Actual 105.4
Briefing Forecast 109.5
Market Expects 107.8
Prior 105.9
Revised From 104.5

[54anickel]

39. Oil Prices Drop After Inventory Rise

http://www.cbsnews.com/stories/2006/11/01/ap/business/mainD8L4CR3G7.shtml

(AP) Oil prices fell Wednesday, after the U.S. government reported that crude oil inventories climbed last week.

Heating oil and gasoline inventories fell, as expected, but the report indicated that refiners are boosting production.

Light sweet crude for December delivery fell 70 cents to $58.03 a barrel in morning trading on the New York Mercantile Exchange.

Heating oil futures fell 2.4 cents to $1.6430 a gallon.

Gasoline futures rose less than a cent to $1.4350 a gallon.

According to the U.S. Energy Information Administration's weekly report Wednesday, U.S. crude oil inventories rose by 2 million barrels to 334.3 million barrels in the last week.

That was largely due to crude imports bouncing back up by 599,000 barrels per day from the previous week, when imports dropped off significantly.

more...

[54anickel]

44. U.S. Oct. ISM manufacturing index 51.2% vs 52.9% in Sept.

http://www.marketwatch.com/News/Story/Story.aspx?siteid=mktw&guid=%7B98F7BC14-4A79-43BE-B89C-0DC827EDC3D0%7D

WASHINGTON (MarketWatch) -- Factory activity in the United States decelerated in October, the Institute for Supply Management reported Wednesday. The ISM index fell to 51.2% in October from 52.9% in September. This is the lowest level since June 2003. The decline was unexpected. The consensus forecast of estimates collected by Marketwatch was for the index to rise to 53.2%. Readings above 50 indicate expansion. New orders fell to 52.1% in October from 54.2% in September. The employment index rose to 50.8% from 49.4%. The price index fell sharply to 47.0% from 61.0%.

[54anickel]

45. U.S. Sept. construction spending falls 0.3%

http://www.marketwatch.com/news/story/story.aspx?guid=%7BECF47F09-C982-46D0-B102-40256137B317%7D

WASHINGTON (MarketWatch) -- Outlays on U.S. construction projects fell 0.3% in September, led by drops in spending on private residential construction and federal building projects, the government said Wednesday.
Private residential construction spending fell 1.1% in September after declining by 1.6% in August, according to the Commerce Department.
In a reflection of the ongoing housing slowdown, September marked the sixth consecutive month that spending on private residential construction fell. Over the past twelve months spending is down 6.9%
Overall private construction spending dropped by 0.7%. But it is up 0.6% in the past year.
Spending on federal construction projects dropped by 1.5% in September.
Total construction spending was revised to neither rise nor fall in August.
more...

[ozymandius]

3. Oil prices down slightly in Asia

SINGAPORE - Oil prices fell slightly Wednesday as the market watched for any weather or geopolitical events that might affect prices.

Light sweet crude for December delivery on the New York Mercantile Exchange fell 12 cents to US$58.61 a barrel in Asian electronic trading on the New York Mercantile Exchange.

"The market has no real headlines to drive it, and the weather forecast for the northern hemisphere winter is on the warm side," which will keep prices around US$57-58 a barrel, said Victor Shum, an energy analyst at Purvin & Gertz in Singapore.

A sudden cold snap, however, would bump up fuel demand and prompt a price spike, he said.

http://news.yahoo.com/s/ap/oil_prices

[ozymandius]

4. UAE cuts oil production by 100,000 barrels per day

ABU DHABI (AFP) - The United Arab Emirates will start cutting its daily oil output by 100,000 barrels per day following an OPEC decision to slash overall production by 1.2 million barrels per day , the energy minister said.

"We are strongly committed to cut our output by 100,000 barrels per day, starting from today," Mohammad bin Dhaen al-Hamli told reporters on the sidelines of an oil conference Wednesday.

"In line with the recent (OPEC) decisions in Doha (to cut production), we are in complete adherence to these decisions," he said.

http://news.yahoo.com/s/afp/20061101/wl_mideast_afp/uaeoilopec_061101102127

[ozymandius]

5. Bolivia minister says oil firms can expect 15% profit -report

RIO DE JANEIRO (MarketWatch) -- Foreign energy firms can expect to have a profit margin of about 15% from their Bolivian production, Bolivia's Hydrocarbons Minister Carlos Villegas said in an interview published in Brazil's O Globo newspaper Tuesday.

"On average, the profitability of the oil industry here in Bolivia and in the rest of the world is about 15%. It will be more or less that," Villegas said when asked what the profit margin of Brazil's state-run oil firm Petroleo Brasileiro SA (PBR), or Petrobras, will be after signing new production contracts.

Petrobras and other foreign oil companies, among them Spain's Repsol-YPF (REP) and France's Total (TOT), over the weekend reached a deal with Bolivia on new oil and gas production contracts to comply with the country's nationalization of its hydrocarbons sector.

Bolivia so far hasn't made the exact content of the new contracts public, but will do so as soon as they are sent to Bolivia's congress for approval. That will happen by Nov. 20, Villegas said.

http://www.marketwatch.com/news/story/story.aspx?siteid=mktw&guid=%7B5185C43F-C725-497F-BF09-4FD8FB296DA3%7D

[ozymandius]

6. BP to Replace Leader of Alaska Unit After Pipe Leaks

Nov. 1 (Bloomberg) -- BP Plc, Europe's second-largest oil company, will replace the head of its Alaskan unit after inadequate maintenance led to leaky pipelines, the shutdown of the largest U.S. oil field and an investor lawsuit.

Doug Suttles, president of BP's operations on the Russian island of Sakhalin, will become president of BP Exploration (Alaska) Inc. on Jan. 1, taking over from Steve Marshall, spokesman Daren Beaudo said in a telephone interview today.

BP Chief Executive Officer John Browne has fired, disciplined or replaced employees and executives in Alaska and at the company's Texas City, Texas, refinery, where an explosion killed 15 people last year. BP's reputation also was damaged by alleged propane price manipulation. London-based BP promoted Robert Malone in June as the president of BP America Inc.

``There were question marks about the way BP handled the problem, and the management has made mistakes,'' Dariusz Kowalczyk, chief investment strategist at CFC Seymour Ltd., said in Hong Kong. ``This could appease the U.S. regulators. Getting rid of some of the executives makes sense.''

http://www.bloomberg.com/apps/news?pid=20601103&sid=aQKacLcQeFkI&refer=us

[54anickel]

14. I dunno, reads like sacrificial lambs to appease the gods. Hard to tell

without seeing an org chart. It's rare to see someone with 24 years seniority make it into a big management position without assimilating the culture of such a huge bureaucratic company. You tend to see that type of seniority in the rank and file, but management? :shrug: Wonder what their severance packages look like? Hate being so cynical, but come on, we're talking BP here. We've seen the sort of ethics their CEO had.

[AnneD]

61. And as of late...

they are one of the better groups. They probably want to downsize. They may be out a bundle over the refinery explosion here. One case will come to court this week or next. This woman lost both her parents. They just as well give it up. The only thing to negotiate is the amount-they won't win this one.

[54anickel]

38. Oil Declines on Speculation of U.S. Inventory Gain, OPEC Doubts

http://www.bloomberg.com/apps/news?pid=20601072&sid=aRXMGfX8cGrY&refer=energy

Nov. 1 (Bloomberg) -- Crude oil fell on speculation that stockpiles gained in the U.S., the world's largest energy market, and as traders questioned OPEC's resolve to reduce production.

Oil inventories probably gained 2.6 million barrels last week, according to a Bloomberg News survey of analysts. Supplies, already above their five-year average, have risen as refiners close plants for maintenance. Traders said they were skeptical that members of the Organization of Petroleum Exporting Countries will stick to an agreement to cut output to prop up prices.

``The expectations are for the U.S. oil stockpiles to rise,'' said Peter Luxton, a London-based energy analyst at Informa Global Markets. ``People are cautious if OPEC will be disciplined to implement the cut.''

Crude oil for December delivery fell as much as 47 cents, or 0.8 percent, to $58.26 a barrel in after-hours electronic trading on the New York Mercantile Exchange. The contract traded at $58.37 at 11:26 a.m. in London. Brent crude oil for December declined 33 cents to $58.70 a barrel on the ICE Futures exchange in London.

``We are waiting to see how OPEC will cut production, as some countries can't manage to do so,'' said Thina Saltvedt, an analyst at Nordea Bank AB in Oslo.

more...

[ozymandius]

7. Google buys wiki maker

Google has acquired JotSpot, a Palo Alto company that makes Web-site pages called wikis, for an undisclosed amount, according to statements released Tuesday by both companies.

The purchase is further evidence of one of the Internet search giant's emerging strategies: helping people share information and media online.

-cut-

Wikis are changeable Web pages whose content can easily be edited by many users, allowing people in different locations to collaborate on a page. They're among a host of social software and services, often described as ``Web 2.0,'' that companies are offering to help consumers and businesses create and share data on the Web.

Microsoft and IBM have recently announced upcoming wiki offerings, and Yahoo has a partnership with San Bruno-based PBwiki to host wikis for Yahoo Groups. Kraus said JotSpot spoke with several software and Internet companies before settling on a deal with Mountain View-based Google.

http://www.mercurynews.com/mld/mercurynews/business/technology/15899846.htm

[ozymandius]

8. Wages, benefits on upswing

WASHINGTON -- Wages and benefits paid to American workers rose last quarter by the most since 2004, as the unemployment rate matched a five-year low.

The Labor Department said Tuesday that its employment cost index rose 1 percent compared with the second quarter. In the 12 months ended in September, costs shot up 3.3 percent, the biggest year-over-year advance since the first quarter of 2005.

Rising labor costs, which account for about two-thirds of company expenses, suggest few signs of abating inflationary pressures that Federal Reserve policymakers forecast will accompany slower economic growth.

Central bankers, who last week kept interest rates unchanged for the third meeting in a row, said the economy will "moderate" even as "inflation risks remain."

-cut-

The employment cost index measures the cost to companies of wages, benefits and employer-paid taxes, such as Social Security and Medicare.

http://www.chicagotribune.com/business/chi-0611010020nov01,0,5243746.story?coll=chi-business-hed

[54anickel]

21. Geez, I'm getting tired of that "wages up" spin in the headlines. It's the

total labor cost for crying out loud, and it's going to show an increase every year now that the FICA ceiling is going up each year. Add the costs of health and retirement benefits and what the heck do they think is going to happen to the cost of labor each year? But nearly every headline seem to be telling us we're soooo much better off - we're getting stinkin' rich!!!! :eyes:

[ozymandius]

23. There was a little debate in my head about posting that.

But then I decided - "what the hell" - and did it anyway because of the poignant issues the article ignores.

You said it spot-on 54anickel.

[54anickel]

28. Personally, I don't think FICA should even be considered a GD cost of

labor until they put it in a "lock-box", same for pensions as far as that's concerned. How can that sh*t be counted as a benefit to me if the gov't and corps can raid/underfund either one at a GD whim? :grr:

Anyway, I'm glad you posted it. We need to beat on their spin every chance we get. I was happy to see yet another opportunity to rant! Call me a curmudgeon. :evilgrin:

[Hugin]

29. My question from yesterday still stands...

About whether it's 'mean' or 'median' salaries are up... My thinking being it only takes
one CEO raise to squelch thousands of other worker's stagnation.

But, here you say it's based on labor cost?!?!?!

That's screwed up!

[54anickel]

30. Sorry, should have said employment costs vs labor costs - to include

both direct and indirect labor - management and labor payroll costs. I've been out of accounting for a looong time. But we used to have a main GL account that all payroll went to, made of sub-accounts. Direct "labor" costs were a separate sub-account to come up with the cost of goods sold, office help, management and the payroll service we used were the 3 other sub-accounts, though we generally considered those "overhead". When we wanted the cost of goods to look higher, we'd mess with those sub-accounts.

I figured (maybe incorrectly) the numbers they are using in these reports is the main GL account - all payroll costs. The average increase they are talking about is the average of the reporting companies total costs. So mean vs median salaries per company doesn't exactly apply, though I understand what you're saying. It's the old average salaries of a room full of people is X, but in walks Bill Gates and suddenly X rises exponentially.

[Hugin]

31. Wow... So, they're using that spaghetti bowl logic to say 'wages rise'?

Yikes!

I guess I'll stick to my math. :D

[54anickel]

32. That's my guess. That's why the term "wages" shows in the headline -

You'd have to read deeper into the article to find out what "wages" really consists of. Then look even deeper to the explaination of the report itself if you really want to get ticked off.

http://biz.yahoo.com/c/terms/income.html

Personal Income and Consumption
Importance (A-F): This release merits a C+.
Source: The Bureau of Economic Analysis of the Department of Commerce.
Release Time: 8:30 ET around the first business day of the month (data for two months prior).
Raw Data Available At: http://www.bea.doc.gov/bea/rels.htm -- see personal income release.

Personal income measures income from all sources. The largest component of total income is wages and salaries, a figure which can be estimated using payrolls and earnings data from the employment report. Beyond that, there are many other categories of income, including rental income, government subsidy payments, interest income, and dividend income. Personal income is a decent indicator of future consumer demand, but it is not perfect. Recessions usually occur when consumers stop spending, which then drives down income growth. Looking solely at income growth, one may therefore miss the turning point when consumers stop spending.

The income report also includes a section covering personal consumption expenditures, also known as PCE. PCE is comprised of three categories: durables, nondurables, and services. The retail sales report will provide a good read on durable and nondurable consumption, while service purchases tend to grow at a fairly steady pace, making this a relatively predictable report, and ranking it well below retail sales in terms of market importance.


Go even deeper and look at at the tables....if you dare (what a cluster)

http://bea.gov/bea/newsrelarchive/2006/pi0906.htm

Oh and what's this, at first glance there seems to be some change going on in how the tables are presented (and some of the explainations buried within from the 2nd qtr to this lateset one. Could just be a formatting difference - I haven't looked that closely yet, but the previous report seems to give more footnote info such as:

1. Net earnings is earnings by place of work—the sum of wage and salary disbursements, supplements to wages and salaries, and proprietors' income—less contributions for government social insurance plus an adjustment to convert earnings by place of work to a place-of-residence basis.

1. Earnings by place of work is the sum of wage and salary disbursements (payrolls), supplements to wages and salaries, and proprietors income.
2. "Other" consists of the wage and salary disbursements to U.S. residents employed by international organizations and foreign embassies and consulates in the U.S.


http://bea.gov/bea/newsrel/SQPINewsRelease.htm

[ozymandius]

9. Job-market worry hurts confidence

Americans' concern about the job market led to an erosion in consumer confidence in October, a report Tuesday showed.

News about job losses at auto plants and other manufacturers is contributing to persistent worries among workers about employment, economists say.

"I think there is enough negative news on the employment front to offset the good stuff that is happening," said Gary Thayer, chief economist at A.G. Edwards & Sons Inc. in St. Louis.

The Conference Board said consumer confidence edged down to 105.4 from a revised 105.9 in September, as job worries offset the benefits of falling gasoline prices. Analysts had expected a reading of 107.8.

http://www.latimes.com/business/careers/work/la-fi-econ1nov01,1,227954.story?coll=la-headlines-business-careers

[54anickel]

40. Private-sector jobs rise 128,000, ADP says

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B40E7307F%2D371D%2D476D%2D9EA9%2D367C06F67007%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

WASHINGTON (MarketWatch) -- The U.S. economy added about 128,000 private-sector jobs in October, a modest rebound in hiring, according to the monthly ADP employment report released Wednesday.

The ADP report is slightly stronger than the consensus estimate of 121,000 for October nonfarm payrolls, which will be released by the Labor Department on Friday.
The ADP report covers private-sector jobs only. After adding in the government-sector jobs left out of the ADP index, the report suggests nonfarm payrolls rose by about 140,000 in October.

"These findings suggest a modest reacceleration of employment in October, following three months during which gain in private employment averaged a slower 95,000," said Joel Prakken, chairman of Macroeconomic Advisers LLC, the economic firm that computes the ADP index from anonymous payroll data provided by Automatic Data Processing Inc.

The ADP report is considered by some to be the best single predictor of the government's nonfarm payroll report, but its record has been spotty since being rolling out in public in April.

mroe...

[ozymandius]

10. UPDATE 1-Time Warner earnings rise on Adelphia, AOL

NEW YORK, Nov 1 (Reuters) - Time Warner Inc. (TWX.N: Quote, Profile, Research) on Wednesday said third-quarter profit nearly tripled, boosted by a gain from the purchase of cable operator Adelphia Communications Corp. (ADELQ.PK: Quote, Profile, Research) and other investments.

The results also benefited from a 46 percent rise in online advertising sales at the AOL Internet division and a 44 percent revenue gain with subscriber growth at the cable division.

The world's largest media company, which also owns the Warner Bros. movie studio and the CNN cable network, said net profit rose to $2.3 billion, or 57 cents per share, from $853 million, or 18 cents per share, a year earlier.

Revenue increased 7 percent to $10.9 billion.

http://today.reuters.com/news/articleinvesting.aspx?type=marketsNews&storyID=2006-11-01T115909Z_01_N01276446_RTRIDST_0_MEDIA-TIMEWARNER-EARNS-UPDATE-1.XML

[texpatriot2004]

11. Great Cartoon nm

[UpInArms]

12. daily dollar watch

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

Last trade 85.47 Change +0.14 (+0.16%)

Dollar Sells Off on Weak Data; ADP to Give Us a Sneak Peek on Payrolls

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Dollar_Sells_Off_on_Weak_1162334536361.html

US Dollar – Disappointing US data has sent the dollar tumbling to a fresh monthly low. Although the University of Michigan consumer confidence survey increased last week, the Conference Board’s number dropped from 105.9 to 105.4. Consumers were less optimistic about the current state of the economy, but were optimistic about the future. With oil prices low and interest rates steady, it is not surprising to see consumers adopt a more jovial mood as we get closer to the holidays. Manufacturers however did not share the same sentiment. The Chicago PMI report dropped from 62.1 to 53.5, the lowest print since August 2005. Inventories accumulated to the highest level since the 1970s, which suggests that some harsh measures may need to be taken to rein in those numbers. Chicago is not the only region to be suffering from the slowdown in the manufacturing sector as the Philadelphia Fed index reported a very sharp drop earlier this month. Even thought the US is a service based economy, the weakness of the manufacturing sector is still very important. Today’s data suggests that we could see a fairly deep retracement in the national ISM report due out tomorrow. The only upside surprise today was in the employment cost index. However rising labor costs is a burden for companies and hardly a very promising development. Tomorrow we get a first peek at how Friday’s non-farm payrolls report could turn out through the ADP release. Last month the ADP payrolls number came out far below the market’s forecast for payrolls and interestingly enough, the ADP number was the more accurate projection for payroll gains in the month of September. The latest reports confirm that the Fed needs to leave interest rates untouched until early next year. Fed Fund futures are currently pricing in a 70 percent probability of a 25bp rate cut in the first half of next year.

...more...

Dollar Continues Lower on Bearish Economic Outlook

http://www.dailyfx.com/story/dailyfx_financial_markets_headlines/Dollar_Continues_Lower_on_Bearish_1162337490756.html

How Did the Markets React?

It was another sad day for US dollar bulls, as poor economic data worsened outlook for the world’s largest economy. Indeed, financial markets reacted by sending the Greenback, bond yields, and stocks substantially lower in the moments following Consumer Confidence and Chicago PMI results. Price movements in bonds and USD-denominated currencies continued through the rest of the day, with the EURUSD setting fresh monthly highs while bond yields fell to their lowest since October 5th. Stock markets, on the other hand, resisted earlier selling pressure to close slightly higher through the day of trading. This was largely due to the fact that crude oil prices continued yesterday’s decline, with the NYMEX current month setting fresh 2-week lows before a late reversal. Regardless, the continued strength in domestic equity markets leads many to believe that a reversal is imminent. Given progressively weaker US economic data, it is perhaps only a matter of time before stock prices retrace from record-highs. Such a reversal would only add to the US dollar’s woes, as it continues its slide against the world’s major currencies.

...more...

[ozymandius]

18. Dollar consolidates losses against euro and yen

The dollar was stick near the bottom of its recent ranges against the euro and the yen on Wednesday, consolidating its losses after weak US economic data sent it to one-month lows against both currencies in the previous session.

On Tuesday, the dollar suffered a sharp decline after a surprise drop in US consumer confidence and a report showed business activity in the mid-west of the US expanded at its slowest pace in more than a year in October.

Adrian Schmidt, senior forex strategist at Royal Bank of Scotland, argued the market's negative reaction to the data was probably more of an indication of its desire to sell the dollar than any proper analysis of the significance of the figures.

He said following weak US GDP numbers last Friday the market was biased towards looking for evidence of a weaker economy and a softer dollar. "While the data might have been ignored in other circumstances, it is currently encouraging the dollar bears," he said.

http://news.yahoo.com/s/ft/20061101/bs_ft/fto110120060725243055

Doin' a heckuva job Bushie!

[54anickel]

36. Gold buoyed by weak dollar, decouples from oil

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B36ACF5F5%2D0778%2D4B31%2D9942%2DA37270854AAC%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

SAN FRANCISCO (MarketWatch) -- Gold futures climbed as much as $11 an ounce on Wednesday, buoyed by recent dollar weakness, continued reports of robust physical demand linked to the holiday season and buying on the first day of the new month.

"A weakening U.S. dollar, increased geopolitical concerns and a likely win for the Democrats are all bullish factors for gold going forward," said Peter Grandich, editor of the Grandich Letter.

"A close above $612 should signal a new leg up in the gold secular bull market," he added.

Gold for December delivery was last up $10 at $616.80 an ounce on the New York Mercantile Exchange after trading as high as $617.80, its highest level since Sept. 8. The contract fell Tuesday on diminishing geopolitical worry after North Korea agreed to resume six-party nuclear talks, but gained $3 on the month amid worries about a U.S. economic slowdown.

"The recent weakening in the dollar due to last week's poorer-than-expected U.S. economic figures has pushed up the gold price in dollar terms," said analysts at Numis Securities. They also noted that the close correlation between the oil price and gold price seen since the end of 2005 has weakened this week, with gold prices rising but oil prices falling.

more...

[54anickel]

48. Gambling Against the Dollar

http://www.nytimes.com/2006/11/01/business/01leonhardt.html?_r=1&adxnnl=1&oref=slogin&ref=business&adxnnlx=1162406355-rHENpi+AZOrMDsjE8jS8qg

A couple of years ago, Robert E. Rubin — éminence grise at Citigroup and the Democratic Party’s economic wise man — decided that the United States dollar was headed for a fall.

This view put Mr. Rubin in good company. Nearly everyone who spends time thinking about the American economy believes that the value of the dollar has to fall at some point.

snip>

This is a column about why Mr. Rubin’s logic made perfect sense — why it still does, in fact — yet why most people who have made similar bets in recent years have taken a bath. Warren E. Buffett cost Berkshire Hathaway almost $1 billion last year shorting the dollar. On the opposite end of the investing spectrum, I put a small amount of my retirement savings last year into a T. Rowe Price mutual fund that is linked more directly to foreign currencies than most foreign-stock funds are. It has delivered a return of negative 7 percent.

The fate of the dollar, to be blunt, often seems like one of the most boring economic subjects around. It doesn’t offer obvious “Freakonomics”-type lessons about the foibles of everyday life. Instead, it has inspired a stack of policy papers filled with terms like current-account deficit and trade-weighted exchange rate.

But it really is worth trying to understand what’s going on. In the end, the value of the dollar will go a long way toward determining how well Americans live: which food we can afford to eat, which cars we can buy, which foreign policy we can pursue. As Mr. Rubin says: “It is vitally important. It has the potential to affect all of us.”

more...

[54anickel]

51. The Dollar's Full-System Meltdown

http://informationclearinghouse.info/article15440.htm

snip>

In September, we saw early signs that the dollar was in trouble. The trade deficit registered at $70 billion but the Net Foreign Security Purchases (NFSP) came in at a paltry $33 billion. That means that our main trading partners are no longer buying back our debt which puts downward pressure on the greenback. The Fed had two choices; either raise interest rates substantially or let the currency fall. Given the tenuous condition of the housing bubble and the proximity of the midterm elections, the Fed did neither.

A month later, in October, the trade deficit hit $69.9 billion but, then, without warning, a miracle occurred. The Net Foreign Security Purchases skyrocketed to a “historic high” of $116.8 billion; covering both months’ shortfalls almost to the penny.

Coincidence?

Not likely. Either the skittish central banks decided to “stock up” on their dollar-denominated investments or the Federal Reserve (and their banking-buddies) is buying back its own debt to float us through the elections.

This is exactly the kind of hanky-panky that people expected when Greenspan stopped publishing the M-3 last March keeping the rest of us in the dark about what was really going on with the money supply.

snip>

Of course, everyone in Washington already knew that doomsday was approaching. That’s the way the system was designed from the very beginning. It’s all part of the madcap scheme to “starve the beast” and transfer the nation’s wealth to a handful of western plutocrats. That’s explains why the Fed and the White House whirred along like two spokes on the same wheel; every policy calculated to thrust the country headlong toward disaster.

The administration never created a funding mechanism for the $400 million tax cuts or for the 35% expansion of the Federal government. Defense spending increased by leaps and bounds as did the “no-bid” contracts for friends of the Bush clan. At the same time, interest rates were lowered to rock-bottom to put as much money as possible into the hands of people who couldn’t meet the traditional criteria for a mortgage. And, if gluttonous waste, reckless overspending and “Mickey Mouse” loans were not enough; the Fed capped it off by doubling the money supply in 7 years; a surefire prescription for hyper-inflation.

So, which one of these policies was not deliberate?

The financial crisis that we now face was created by design. It is intended to destroy the labor movement, crush the middle class, quash Medicare, Medicaid and Social Security, reduce our foreign debt by 50 or 60%, force a restructuring of America’s debt, privatize all public assets and resources, and create a new regime of austerity measures which will divert more wealth to the banking and corporate establishments.

more...

[54anickel]

54. Gold end $12 higher, lifted by weak dollar prospects

http://www.marketwatch.com/News/Story/Story.aspx?siteid=mktw&dist=moreover&guid={36ACF5F5-0778-4B31-9942-A37270854AAC}

SAN FRANCISCO (MarketWatch) -- Gold futures climbed more than $12 an ounce Wednesday to close at their strongest price since early September, buoyed by recent dollar weakness and continued reports of robust physical demand linked to the holiday season.

snip>

Gold for December delivery closed up $12.50, or 2.1%, at $619.30 an ounce on the New York Mercantile Exchange after trading as high as $619.70. It hasn't closed or traded at levels this high since early September. The contract fell Tuesday on diminishing geopolitical worry after North Korea agreed to resume six-party nuclear talks, but gained $3 on the month amid worries about a U.S. economic slowdown.

"The recent weakening in the dollar due to last week's poorer-than-expected U.S. economic figures has pushed up the gold price in dollar terms," said analysts at Numis Securities.

snip>

The dollar touched five-week lows against the euro and yen Wednesday after a batch of economic reports reinforced the market view that the U.S. economy is slowing. See Currencies.

"The dollar has taken some serious uppercuts of late, and U.S. consumers have not only toned down their optimism quite rapidly, but are not too eager to spend the extra few dollars in their wallets that a curiously cheaper gasoline price has suddenly yielded," said Jon Nadler, an investment-products analyst at Kitco.com.

"Gold will bounce along quite nicely if the dollar continues to have such flu symptoms and/or if people start pulling some money off the very, very rich pile that is sitting on the equities gaming tables," he said.

more...

[Ghost Dog]

63. The Dollar's Full System Meltdown By Mike Whitney

DU thread: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x243652

[AnneD]

13. Morning Marketeers....

:donut: and lurkers. Prag, got you an extra cup:donut: The cartoon was good today but the teeny tiny tune was the best. Kinda sums up my fears as to where we are heading as a nation. Hubby and I have been watching the election cycles closely. The next 2-4 years will determine where we will be probably for the rest of our lives. And I am sorry to say it may not be in the USA. Both of us have skills that are easily transferable and desirable so we feel comfortable with a move.

This administration is rapidly turning this nation into a third world country. The laws they have passed and their policies have done great harm to this truly blessed land. If this country were pre WWII Germany, we are at the point where Hitler totally takes over the government and is about to dissolve the Parliament and the Supreme Court. The next step is enforcement of these newly passed laws and the roundup of dissident (read DEM) citizens (with terrorist connections of course).If I could make one wish, I would do away with the Electoral College and do a direct vote. I think that would open the field and make us more of a Democracy.


Happy hunting and watch out for the bears.

[Hugin]

16. Morning AnneD!

Thanks!

:hangover:

Here's seconding the 'direct vote'.

Maybe even adding a 'nonpartisan retention vote' to the Supreme Court.

[Kukesa]

22. And good morning to you, from a lurker.

I always read this thread but never feel smart enough to comment!

[ozymandius]

24. Don't be shy.

I am scarcely smart enough to post here, yet I start the thread every day.

Ozy :hi:

[Hugin]

26. Whaaaat?

Your sifting and critical thinking skills are way above par!

=)

[AnneD]

37. When I first started posting.....

over a year ago, my knowlege in economics was based on experienced. We all have our area of expertise (mine is health care and the oil industry) and folks 'round here are a friendly lot and are good to answer any questions I have (short of a stock tip)no matter how silly I think it might seem. In the year I have read this, my knowlege of economics has grown. Just reading this thread will bump your IQ points up. I feel I can make more informed choices thanks to the folks that keep this thread going.

Never think you can't chip in. The ground reports I get from folks in different parts of the country are the best economic intelligence I can get. Classic example-Katrina wiped out the Port of NO. I knew that NOLA was the main spot for shipping coffee and sugar and that the warehouses were destroyed. I wrote about it on a thread 3-5 mos before sugar went up. It wasn't a tip, just an observation. Knowlege is power-and the knowlege I get here is VERY powerful. And a big thanks to Ozy for starting this thread...

Ozy, you may have said this before, but what caused you to start this thread? Most of America seems to think DEMS and economics are mutually exclusive.

[ozymandius]

50. I became addicted to this thread when radfringe posted it.

That was in 2002. Long had I known the the supposedly "boring" business section of the newspaper was really a politics section. Politics is mostly about money: who has it; what they do with it; what (or who) controls the money flow.

The allure of this thread, then and now, was the anecdotal and scholarly depth that so many contributors here convey.

To answer your question Anne - radfringe posted this thread at her office until the powers-that-be decided that Internet access was unnecessary. She leaves for work at an obscenely early hour of the day such that it made it impractical to post. That's when I took over.

[AnneD]

58. Thanks for the

history. I too enjoy the anecdotal and scholarly depth of this thread.

And as financial investigators have known since the days of Elliot Ness and AL Capone..."follow the money". We live in exciting times because it is easier than ever to do just that. On this thread we have many eyes, not just one set of eyes.

[ozymandius]

15. 9:58 numbers and blather

Dow 12,100.26 Up 18.33 (0.15%)
Nasdaq 2,371.60 Up 4.89 (0.21%)
S&P 500 1,379.83 Up 1.89 (0.14%)
10-Yr Bond 4.606% 0.00
NYSE Volume 331,013,000
Nasdaq Volume 200,603,000

09:40 am : Given that Q3 is well on track to post a 13th straight quarter of double-digit profit growth, the market's focus is now shifting toward economic data in order to gauge the severity of the economic slowdown. However, while investors were initially exhibiting a wait-and-see attitude ahead of the 10:00 ET release of the ISM Index, especially after yesterday's Chicago PMI hit a 14-month low, a hint that this week's biggest economic event -- the October employment report -- may check in stronger than expected, has improved sentiment and kicked off a new month on an upbeat note. At 8:15 ET, the monthly ADP employment report showed that the economy added about 140,000 nonfarm payrolls in October, helping to ease ongoing concerns about the strength of the economy. Economists expect the Labor Dept. on Friday to show a rebound in payrolls of 125,000 following a sluggish increase of only 51,000 jobs in September. DJ30 +35.46 NASDAQ +5.22 SP500 +2.80 NASDAQ Vol 92 mln NYSE Vol 58 mln

[ozymandius]

19. CVS in Talks to Buy Drug Middleman

CVS, the second-biggest drugstore chain in the country, is in advanced talks to acquire Caremark Rx, the leading pharmacy benefits manager, for more than $21 billion, people close to the negotiations said yesterday.

The transaction would transform CVS from being primarily a retailer to becoming the nation’s preeminent manager of pharmacy benefits.

The merger talks illustrate the attraction that pharmacy benefits managers — middlemen between the drug companies and employees and others with drug benefits coverage — still hold despite the challenges to the business that have emerged in recent weeks. A program by Wal-Mart to offer generic drugs for $4 has been seen as a threat.

-cut-

Because of their buying power, the big pharmacy benefits managers often can obtain lower prices on a number of drugs for its members. But some recent developments may pose challenges to the company’s pricing powers.

http://www.nytimes.com/2006/11/01/business/01deal.html?_r=1&ref=business&oref=slogin

[ozymandius]

20. seeing red

10:23
Dow 12,079.61 Down 2.32 (0.02%)
Nasdaq 2,365.32 Down 1.39 (0.06%)
S&P 500 1,377.89 Down 0.05 (0.00%)
10-Yr Bond 4.561% Down 0.045
NYSE Volume 559,235,000
Nasdaq Volume 367,878,000

10:00 am : Indices continue to sport modest gains as seven out of 10 economic sectors remain positive. The Utilities sector (+0.8%) is pacing the way higher following better than expected earnings reports from Dominion (D 82.79 +1.81) and NICOR (GAS 47.95 +1.99). Health Care, though, is providing the bulk of early leadership as Caremark Rx (CMX 50.70 +1.47) confirming it is in talks with CVS Corp (CVS 29.38 -2.00) regarding a possible "merger of equals" leaves Health Care Services as this morning's best performing S&P industry group (+3.6%). McKesson (MCK 51.50 +1.41) and CIGNA (CI 124.71 +7.73) topping expectations and boosting full-year EPS forecasts are providing additional sector support. Strength in Tech, Industrials and Financials is also helping to offset weakness in Energy and Consumer Staples.DJ30 +26.02 NASDAQ +5.75 SP500 +2.18 NASDAQ Dec/Adv/Vol 939/1535/166 mln NYSE Dec/Adv/Vol 856/1873/94 mln

[54anickel]

25. Curious Change in Margin Requirements (Uh-oh...wtf)

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=59824

Through the SEC, the Fed controls margin requirements and a recent announcement was described by the deputy director of the SEC as "a very significant change". Remember that this is essentially the same Fed and SEC that argued that no increases were needed during the late 1990s' tech mania.

Now they are talking about lowering margin requirements for institutions on stocks, options, and futures. Now ranging from 25% to 50%, the proposal is to drop them to 15%.

Of course, prevailing margin requirements were imposed by panicked policymakers in the 1930s' contraction in order to prevent another 1929 blowout. This was understandable as, at the time, most knew that the bust was caused by the preceding boom. Propaganda since by a few generations of interventionist economists insist that the depression was "caused" by the hike in administered rates from 5% to 6% in August, 1929. This conclusion, of course, was contrived to retrospectively protect the infallibility of the Fed as an institution by shifting the blame to the functionary that hiked the discount rate – a classic example of the left's chronic resort to ad homenum argument.

As with a senior central bank in any great financial mania, it followed the course of short-dated market rates of interest – typically by a few months. Recent examples blew out in 2000, 1929, and 1873.

Traditionally, the Fed raised margin requirements as a stock boom matured and then lowered them near the end of the inevitable contraction. Despite the remarkable intensity of the 2000 mania, margin requirements were not increased. Perhaps the Fed rationalized this non-action as not wanting to be seen doing anything that could be construed as breaking the mania - a curious abandonment of touted contra-cyclical genius.

more...

[Hugin]

27. "a classic example of the left's chronic resort to ad homenum argument. "

:rofl:

It's strange they should say that...

[specimenfred1984]

34. They're criminals and of course repukes

Head of the SEC is a Raygun psychopath. These people are fascists in every definition of the word. It's also common knowledge now that the stock markets are a propped up front for their fascism.

They only thing the U.S. has going for it is that these psychopaths feed on each other.

[hatrack]

52. Especially considering that they can't even spell it . . .

:eyes:

[54anickel]

53. I was going to point that out, but decided the entire paragraph made

litte sense the way it's written. Could be taken 2 ways, the "left" comment as part of the whole contrived cover for the Fed, in which it was part of the propaganda, or that the left is always up to "ad homenum arguments". Then again that "interventionist economist" label seems to get tossed around as meaning the left, while we all know that Raygun, Greenspin and the "free-market" right practice much more intervention into the markets than the left would ever dream of. The left tends intervenes thru social programs, the right intervenes directly in the supposedly "free-markets".

Basically, I had no idea what to make of that whole paragraph. :crazy:

[54anickel]

33. Dow's Rise to 12,000 Was Second Slowest 1,000 Point Rise In Its History

From Oct 20 - for what it's worth to ya....

http://biz.yahoo.com/seekingalpha/061020/18922_id.html?.v=1

Birinyi's Ticker Sense submits: For the first time in over seven years, the DJIA closed above a new thousand point threshold.

As the table below the lower chart details, since the Dow first closed above 1,000 on 11/14/72, the duration between 11,000 and 12,000 was the second longest stretch behind only the time it took to go from 1,000 to 2,000.

This is even more noteworthy when placed in the context of percentage terms as it took the DJIA over seven years to rise 9%- hardly a sign of irrational exuberance. Compare this to the 1990s, when over the same time period the Dow crossed eight different thousand point thresholds.

This no irrational exuberance baby. This is the real thang!!! :eyes: :sarcasm:

[gristy]

66. I don't see this as particularly relevant

Plot it with the y axis on a log scale and compare the times for each 20% (or whatever) increase.

[54anickel]

67. Me neither (hence the sarcasm smiley). But obviously the author

has concluded that the latest concerns of "irrational market behavior" in the recent rally is nonsense. This is his/her evidence that it's not irrational exuberance (at least not in the way it was defined for the 90s). I didn't write it, I just posted it. I took it as another example of how people try to rationalize their faith in the markets.

[gristy]

68. Ah, pardon my dunceness

Yes, you did have the sacrasm smiley which I missed. I also missed that it was posted by non other than the prolific 54anickel. Sometimes I just fly through threads too fast... Sorry!

[54anickel]

69. Probably missed it since the graphic was sooooo HUGE!!!! in the

original article. Guess the author wanted to shout out their findings! Nothing you need to pardon. Hope my reply didn't come off snooty or anything...I tend to come off terse at times. That's cuz I suck at typing and tend to try and keep my posts short, or I change thoughts midstream while my fingers don't keep up - then it's a real mess as I go back and try to edit the complete mess I just created. ;-) :hi:

[54anickel]

35. "Droplet splatter dispersion" exceeded (Mogambo)

http://www.321gold.com/editorials/daughty/daughty110106.html

snip>

Part of my problem with fear is, I assume, that Total Fed Credit was down again this week, this time by $647 million, which is not a lot, I admit, but a far cry from the customary increases of three and four billion a week! So if the Fed is not creating excess credit, and hasn't been for months, where is the money coming from?

Before you answer, the Fed itself is not absorbing our debt, either, and their hoard also declined by $1.1 billion last week, and the banks unloaded $33 billion in government bonds last week, too.

Hearing the raucous sound of the Mogambo Alert Klaxon (MAK), we rush to the teletype machine to read "Alert! Alert! Money had better start coming from some damned where, and pretty damned soon, too, as you cannot get rising stock prices, rising bond prices, rising real estate prices and/or rising government prices without lots and lots and lots of new money!"

snip>

So where, where, where is all the money coming from to finance the continuation of the rises in stocks and bonds and houses and government? Well, for one thing, the Treasury put us another $10 billion in debt last week, which is a nice piece of change, but foreign central banks only bought up $112 million ("Le chump change" in French, so I hear) in America government and agency debt. The answer must lay elsewhere.

Instead of just telling you, as a special treat we will take a short field trip, as part of the annual Mogambo Halloween Scare-A-Thon (MHSAT). Filing off the bus, we soon descend deep into the dark, dank, fetid bowels of the banking system to get a look at Required Reserves. Fearlessly we wade through stinking, slimy water, brushing aside vampires and zombies, but your blood suddenly congeals in your veins, like a big glop of half-melted cheese on a cold hamburger, when your own eyes behold that reserves are now down to a laughable $40 billion!

more....

[54anickel]

41. Two unusual price fluctuations under investigation by the US regulators

http://news.yahoo.com/s/ft/20061031/bs_ft/fto103120061540082992

US regulators are investigating Swiss bank UBS (NYSE:UBS - news) over unusual price fluctuations in US government securities markets.

A spokesman said the bank was "co-operating with the government's investigation".

Separately, a government bond trader at Credit Suisse has left the firm, according to a regulatory filing. A spokesman for Credit Suisse declined to comment. A Treasury official said last month that cases of alleged questionable trading had been referred to the Securities and Exchange Commission and the Commodity Futures Trading Commission.

It is not known exactly what specific activities are under scrutiny. But market participants suggested as possibilities two squeezes that occurred in February on a five-year note and on a two-year note, both of which were in short supply that month.

more...

[54anickel]

42. Paulson re-activates secretive support team to prevent markets meltdown

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/10/30/ccview30.xml

Monday view: Paulson re-activates secretive support team to prevent markets meltdown Judging by their body language, the US authorities believe the roaring bull market this autumn is just a suckers' rally before the inevitable storm hits.

Hank Paulson, the market-wise Treasury Secretary who built a $700m fortune at Goldman Sachs, is re-activating the 'plunge protection team' (PPT), a shadowy body with powers to support stock index, currency, and credit futures in a crash.

Otherwise known as the working group on financial markets, it was created by Ronald Reagan to prevent a repeat of the Wall Street meltdown in October 1987.

Mr Paulson says the group had been allowed to languish over the boom years. Henceforth, it will have a command centre at the US Treasury that will track global markets and serve as an operations base in the next crisis.

The top brass will meet every six weeks, combining the heads of Treasury, Federal Reserve, Securities and Exchange Commission (SEC), and key exchanges.

Mr Paulson has asked the team to examine "systemic risk posed by hedge funds and derivatives, and the government's ability to respond to a financial crisis".

more...gets into the lower margin requirements :scared:

[RawMaterials]

49. more... from article

They should examine a recent report by the New York Fed warning that whenever the yield on 10-year Treasuries has fallen below 3-month yields for a stretch lasting over three months, it has led to each of the six recessions since 1968.

The full crunch hits 12 months later as the delayed effects of monetary tightening feed through, even if the Fed starts easing frantically in the meantime. By then it is too late. "There have been no false signals," it said.

As of last week, the yield curve was inverted by 29 basis points, was continuing to invert further, and had been negative for over three and a half months. If the Fed is right this time, the recession of 2007 is already baked into the pie. Those speculative positions may have to be unwound very fast.

[54anickel]

57. But, but, but, they were playing down all that yield inversion superstition

a couple/few months ago.

[Ghost Dog]

62. DU thread on this area here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x2531566

[54anickel]

65. Thanks GD! n/t

[54anickel]

43. IPO Turmoil Strikes Nymex (another wtf?)

http://www.thestreet.com/_tscfoc/newsanalysis/wallstreet/10317338.html

Just weeks before its planned IPO, the New York Mercantile Exchange has shaken its finance department.

The Nymex, the parent company of the Nymex, announced late Tuesday that its chief financial officer has resigned from the commodities exchange. The exchange sys Jerome Bailey, 54, will continue on in an advisory role to the exchange through its initial public offering

Bailey, a former Marsh & McClennan (MMC - news - Cramer's Take - Rating) executive, became its chief financial officer and chief operating officer in March, after replacing Kenneth Shifrin, the acting CFO at the time.

But in an odd twist, Shifrin, currently Nymex's senior vice president of finance, will get his old job back, succeeding Bailey as CFO.

NYMEX had little to say about the strange turn of events in the press release announcing Bailey's resignation. A Nymex spokeswoman declined to comment on Bailey's resignation.

more...

[54anickel]

46. As buyers balk, builders carry on

Big developers take long-term view, hoping slump wanes as projects end.

http://www.ocregister.com/ocregister/money/abox/article_1340307.php

Talk about bad timing.

Just as homebuilders start on three of the most ambitious redevelopment projects in Orange County's history, the housing market deflates.

What's a builder to do?

The answer could have big implications for cities such as Irvine, Santa Ana and Anaheim, which need more housing for their workers. In a worst-case scenario, builders could abandon or delay projects.

On the other hand, what's bad for builders could be good for homebuyers. A glut of homes hitting the market amid a slump could mean bargain-basement prices.

Builders, publicly at least, aren't panicking.

more...

[54anickel]

47. Japan Must Beat Roach's Forces of Globalization

http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_pesek&sid=a0HAJjclalhU

snip>

Missing Link

Now that Japan has moved from recovery to expansion mode, a surprising missing link has emerged: private consumption.

Turning Japan's enthusiastic savers into aggressive consumers has long been the key to stronger growth. Until now, things have been driven by corporate spending and exports, more and more of which are going to China. What has eluded Japan is a steady increase in household spending.

Incomes aren't rising as hoped. Wages, including overtime and bonuses, were unchanged in September, and household spending fell 6 percent. This year's spending data may cause the Bank of Japan to regret its July decision to increase short-term interest rates from zero to 0.25 percent.

If Japan's prospects are as bright as officials in Tokyo claim and as corporate earnings suggest, why aren't workers sharing in the wealth? Roach argues the explanation rests in how the most developed economies are now suffering the flipside of forces that benefited them throughout the 1990s and early 2000s.

``In my view, this is an unmistakable manifestation of one of the paradoxes of globalization -- a powerful global labor arbitrage that continues to put unrelenting pressure on the labor-income generating capacity of high-wage industrial economies,'' Roach says in a recent report.

Globalization's Dark Side

more...

[specimenfred1984]

55. S&P hits 20-day moving avg, time for miracle buyers to appear

on horrible economic news, of course!

[54anickel]

56. 3:23 numbers and yada - 2:30 brigade failed

Dow 12,021.66 -60.27 (0.50%)
Nasdaq 2,337.19 -29.52 (1.25%)
S&P 500 1,367.95 -9.99 (0.72%)
10-yr Bond 4.5610% -0.0450
30-yr Bond 4.6770% -0.0420
NYSE Volume 2,363,749,000
Nasdaq Volume 1,644,554,000

3:00 pm : Selling remains the name of the game as the major averages vacillate near their worst levels of the day; but not every industry group is under pressure. For instance, Gold (+2.0%) and Insurance Brokers (+1.5%) are today's top two performers following better than expected earnings reports from Newmont Mining (NEM 46.18 +0.91) and Marsh & McLennan (MMC 30.23 +0.79), respectively. Noticeably absent among today's limited list of gainers, though, is Health Care Services. When the market opened, reports that Caremark Rx (CMX 47.54 -1.69) and CVS Corp (CVS 28.76 -2.62) were in talks of a possible "merger of equals" positioned the group as this morning's best performer. However, confirmation that CVS will acquire CMX for $48.76 a share, 1% below yesterday's closing price, now leaves the Health Care Services among today's worst performers (-2.9%). The 8.4% decline on CVS earmarks Drug Retail as the day's biggest laggard (-5.8%).DJ30 -54.43 NASDAQ -21.93 SP500 -8.04 NASDAQ Dec/Adv/Vol 2038/969/1.45 bln NYSE Dec/Adv/Vol 1936/1294/1.27 bln

2:30 pm : Recent recovery efforts don't last very long as a late-day turnaround in oil prices removes what little chance the bulls may have had at getting buying efforts back on track. Crude oil prices have recently spiked back above $59/bbl heading into the close of trading on the NYMEX. The commodity was off as much 1.6% earlier but was recently up as much as 1.2% at $59.45/bbl, in sympathy with a 2.4% surge in natural gas futures, without the Energy sector showing much reaction whatsoever. Energy is still today’s worst performing sector (-0.9%).

DJ30 -57.07 NASDAQ -19.27 SP500 -7.52 NASDAQ Dec/Adv/Vol 1939/1047/1.31 bln NYSE Dec/Adv/Vol 1793/1392/1.15 bln

2:00 pm : Indices continue to chip away at intraday losses but are still trading in negative territory. General Motors (GM 34.70 -0.22) halving its intraday 1.2% decline after recently reporting a better than expected 22% rise in U.S. October sales has helped the Dow improve its stance. However, with 18 of 30 components still losing ground, the temptation to lock in some of the Dow's impressive 3.4% advance in October, following a stronger 4.7% surge in Q3, is preventing the blue-chip index from inching back into the green. DJ30 -23.53 NASDAQ -9.57 SP500 -3.64 NASDAQ Dec/Adv/Vol 1924/1053/1.19 bln NYSE Dec/Adv/Vol 1770/1426/1.05 bln

1:30 pm : More of the same for stocks as selling remains widespread across most areas amid ongoing concerns about the pace of economic growth. Bonds, however, continue to embrace further evidence of a slowing economy since today's weaker-than-expected ISM Index report strengthens the argument of a possible rate cut. To wit, fed funds futures now signal an 18% chance policy makers will cut their target for overnight lending rates by 25 basis points to 5.00% in January compared to a 10% chance just two days ago that the Fed would lift rates in early 2007. As a result, the yield on the 10-year note (+10/32) is now at a one-month low (4.55%).DJ30 -34.10 NASDAQ -12.69 SP500 -4.88 NASDAQ Dec/Adv/Vol 1899/1046/1.11 bln NYSE Dec/Adv/Vol 1798/1363/974 mln

1:00 pm : A renewed wave of selling interest within the last 30 minutes pushes the indices to fresh afternoon lows. Contributing to the recent pullback have been the indices' inability to find support near key technical levels of 12.050, 1373 and 2355 on the Dow, S&P 500 and Nasdaq, respectively. Meanwhile, Apple Computer (AAPL 79.72 -1.36) has erased some of the 2.1% it was losing about an hour ago, but as the second most heavily-weighted holding on the NASDAQ-100 Index, it's 1.7% decline still leaves the tech-heavy Composite as today's worst performing major average.DJ30 -48.98 NASDAQ -13.65 SP500 -5.75 NASDAQ Dec/Adv/Vol 1898/1043/1.01 bln NYSE Dec/Adv/Vol 1759/1382/872 mln

12:30 pm : No real change in the standings as the afternoon session gets underway. However, Materials and Telecom becoming the latest victims to succumb to consolidation leave Utilities as the last sector standing in positive territory. While its 0.7% gain is respectable, securing its position as this year's third best performing sector (14.4%), its paltry 3.5% weighting on the S&P 500 also ranks it as the third least influential of the 10 sectors. Aside from strong earnings (e.g. D +3.5%, GAS +1.9%), the sector has gotten an additional boost from strength in Treasuries pushing yields lower across the curve and making dividend-paying stocks more attractive as defensive names in a down market.DJ30 -32.42 DJUA +0.9% NASDAQ -10.75 SP500 -4.68 NASDAQ Dec/Adv/Vol 1791/1109/900 mln NYSE Dec/Adv/Vol 1671/1449/780 mln

12:00 pm : Stocks are languishing near session lows midday after a second straight disappointing read on manufacturing exacerbates worries about the economy slowing too much.

With the market's focus shifting to economic reports and all eyes on today's ISM Index, especially after yesterday's Chicago PMI hit a 14-month low, the ISM index unexpectedly falling to 51.2% in October (consensus 53.0%) -- its lowest level since June 2003 -- has played into the hands of the bears looking for reasons to take some money off the table. Just yesterday, the Dow and Nasdaq turned in their best October performances in three years.

Even though the ISM data provided yet another indication that the soft landing targeted by the Fed remains on track, as also reflected by the report's prices paid component falling off sharply to 47.0% (the lowest since Feb. 2002) from 61.0%, the absence of leadership from the S&P 500's most influential sectors has sidelined this morning's buying efforts. Stocks opened higher on more strong earnings news, M&A activity, lower oil prices and after monthly ADP employment data suggested Friday's closely-watched jobs report will show a larger than expected rise in October nonfarm payrolls. However, the more influential ISM report has more than overshadowed everything, in particular, the less credible ADP report. Again, crude oil prices remain weak, but the lack of leadership from Energy has more than offset the positive attributes of the continued downtrend in energy prices.

From a sector standpoint, Health Care has been a primary focus after Caremark Rx (CMX 50.47 +1.24) confirmed it is in talks with CVS Corp (CVS 28.89 -2.49) regarding a possible "merger of equals." McKesson (MCK 49.23 -0.86) handily topping expectations and boosting its FY07 EPS guidance was also providing additional sector support, that is until further analysis of a potential CVS-Caremark merger raised uncertainty as to how much of an impact it will have on McKesson's bottom line.

Time Warner (TWX 19.91 -0.10) has actually been today's headliner on the earnings front. However, Q3 earnings coming in a penny shy of analysts' expectations has overshadowed the fact that quarterly profits nearly tripled. BTK -0.7% DJ30 -31.62 DJTA -0.5% DJUA +1.1% DOT -0.1% NASDAQ -10.04 NQ100 -0.5% R2K -0.4% SOX -1.1% SP400 -0.4% SP500 -4.49 XOI -1.1% NASDAQ Dec/Adv/Vol 1711/1141/772 mln NYSE Dec/Adv/Vol 1534/1529/668 mln

[54anickel]

59. OT - Stem cell debate hits new low

http://www.spooneradvocate.com/placed/index.php?sect_rank=4&story_id=227140

MADISON-- Just about when you think there’s nothing more to be said on the issue of embryonic stem cell research, radio talk show giant Rush Limbaugh lowers the debate to new depths.

Those of us who believe that embryonic and adult stem cell research should advance as quickly as possible should send Rush a note of thanks. He may have, single-handedly, ensured that candidates such as Democratic incumbent Gov. Jim Doyle are elected next week.

snip>

Fox continues on the high road when discussing the issue.

“Anybody’s who’s prayed on this, and thought about it, and really considered it, and can’t get their mind or heart around the idea of embryonic stem cell research, I’d go to war for your right to believe that,” Fox said. “Our point, as a community, is we have a very good and supportable conclusion that a vast majority of people in this country are in favor of science playing a leading role in making changes in the future and believe in embryonic stem cell research. We have prayed on it too, and we have thought about it, and we are good people, and we are family people, and we are people who take this very seriously, and we’re as concerned as you are.

“We would like to take this step and to do it with caution, and to do it with oversight, and to do it with the strictest adherence to ethics and all the principles this country stands for,” he said. “But, allow us to do that without infusing the conversation with inflammatory rhetoric and name-calling and fear-mongering. It doesn’t help.”

In Wisconsin, Republican congressional candidate Dave Magnum breaks with his party on the issue. During an appearance on WCLO’s “Stan Milam Show,” Magnum said he would be a hypocrite if he came out in opposition to embryonic stem cell research.

more....

Great news, truth has power if you can get it out there. We've got a gay marriage ban referendum coming up in WI as well and I've got to tell you I've seen a lot of "Christian Conservatives" coming out against it. I know a few who have gotten involved with the "A Fair WI" program to help fight it, labeling it what it is - unfair and discriminatory with regards to individual rights. The ones I know are still hell-bent against gay marriage ceremonies in their church, but they see this as a civil rights issue with regards to the state constitution. It warms my heart to see them coming around to respecting the notion of separation of church and state.

[54anickel]

60. Bwahaha - here's a hoot - China saving too much money: Bush

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2590833

US President George W. Bush said today that he hoped China would transform from a country where people "hoard the money they have" into one where people buy large amounts of US products.

In an interview with conservative radio talk show host Rush Limbaugh, Mr Bush said China should become "a society in which there's consumers. Because now they're a society of too many savers".

"And the reason why they're saving so much money is because there's not a pension plan or a legitimate health care system. And so, therefore, people hoard the money they have in anticipating a bad day," said the president.

"If we can encourage China to become a country of consumers, you can imagine what it would mean for US producers and manufacturers to have access to that market," he said.

more...

http://www.news.com.au/story/0,23599,20687093-1702,00.html

[54anickel]

64. Closing (check out the volumes)

Dow 12,031.02 -49.71 (0.41%)
Nasdaq 2,334.35 -32.36 (1.37%)
S&P 500 1,367.81 -10.13 (0.74%)
10-yr Bond 4.5610% -0.0450
30-yr Bond 4.6770% -0.0420
NYSE Volume 2,821,156,000
Nasdaq Volume 2,095,697,000


4:20 pm : With the Dow and Nasdaq just one day removed from turning in their best October performances in three years, more evidence concerning the severity of the economic slowdown in the U.S. gave investors an excuse to lock in some recent market gains Wednesday.

It is worth noting, though, that today's pullback wasn't all that surprising given the market's knack for knocking trends. After all, the Dow has closed higher on the first day of November 22 times in the last 27 years, according to the Stock Trader's Almanac. Keep in mind too that September is historically the worst month of the year for stocks yet the three major indices on average gained 2.8%.

With the market's focus shifting toward economic data, given that Q3 is well on track to post a 13th straight quarter of double-digit profit growth, all eyes today were on the ISM Index, especially after the Chicago PMI hit a 14-month low a day earlier. The ISM index unexpectedly fell to 51.2% in October (consensus 53.0%) -- its lowest level since June 2003. The reading exacerbated worries that the economy is slowing too much. On a more positive note, the report's prices paid component fell off sharply to 47.0% (the lowest since Feb. 2002) from 61.0%, easing concerns from an inflation standpoint, which is consistent with our view that a soft landing is developing nicely for the economy.

Be that as it may, a market more pre-occupied about the pace of economic growth viewed the data as disappointing and found a reason to take some money off the table. Among the nine sectors losing ground, Technology -- one of last month's best performers -- paced the way lower. Financials, another strong sector of late amid the growing probability of an interest rate cut in the first half of 2007, also sold off.

Health Care was the primary focus Wednesday after reports surfaced that Caremark Rx (CMX 48.03 -1.20) was in talks with CVS Corp (CVS 29.05 -2.33) regarding a possible "merger of equals." However, while confirmation later in the day of a $21 bln deal plays into our Overweight rating on Health Care, the lack of a premium buyout price erased what was a 9% gain in CMX shares. CMX closed down 2.4%, turning today's best performer at the onset of trading into one of the day's biggest laggards. DJ30 -49.71 NASDAQ -32.36 SP500 -10.13 NASDAQ Dec/Adv/Vol 2252/826/2.06 bln NYSE Dec/Adv/Vol 2127/1127/1.75 bln

3:30 pm : Playing into the old adage, "past performance is no guarantee of future results," it's rather safe to say that this November will not begin as so many others have over the years as all three of the major averages are at their worst levels of the session. According to the Stock Traders Almanac, the first day of November is typically a good one for the Dow, kicking off the month on a positive note 22 times over the last 27 years. Faring even worse is the Nasdaq, which has shaved nearly one third of its impressive 4.8% October advance.DJ30 -63.47 NASDAQ -31.45 SP500 -10.59 NASDAQ Dec/Adv/Vol 2154/879/1.64 bln NYSE Dec/Adv/Vol 1995/1248/1.42 bln

3:00 pm : Selling remains the name of the game as the major averages vacillate near their worst levels of the day; but not every industry group is under pressure. For instance, Gold (+2.0%) and Insurance Brokers (+1.5%) are today's top two performers following better than expected earnings reports from Newmont Mining (NEM 46.18 +0.91) and Marsh & McLennan (MMC 30.23 +0.79), respectively. Noticeably absent among today's limited list of gainers, though, is Health Care Services. When the market opened, reports that Caremark Rx (CMX 47.54 -1.69) and CVS Corp (CVS 28.76 -2.62) were in talks of a possible "merger of equals" positioned the group as this morning's best performer. However, confirmation that CVS will acquire CMX for $48.76 a share, 1% below yesterday's closing price, now leaves the Health Care Services among today's worst performers (-2.9%). The 8.4% decline on CVS earmarks Drug Retail as the day's biggest laggard (-5.8%).DJ30 -54.43 NASDAQ -21.93 SP500 -8.04 NASDAQ Dec/Adv/Vol 2038/969/1.45 bln NYSE Dec/Adv/Vol 1936/1294/1.27 bln