STOCK MARKET WATCH, Wednesday 22 June

[ozymandius]

Wednesday June 22, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 213 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 185 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 248 DAYS
DAYS SINCE ENRON COLLAPSE = 1305
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54


U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90

AT THE CLOSING BELL ON June 21, 2005

Dow... 10,599.67 -9.44 (-0.09%)
Nasdaq... 2,091.07 +2.94 (+0.14%)
S&P 500... 1,213.61 -2.49 (-0.20%)
10-Yr Bond... 4.05% -0.05 (-1.32%)
Gold future... 440.50 +0.50 (+0.11%)

GOLD, EURO, YEN, Dollars and Loonie




PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Ike Iossif

XAU Intermediate Term Analysis - Trading Strategy Revisited

At the end of March, I discussed the scenarios, strategies, and expectations I had with regards to gold and gold stocks, specifically the XAU. In the first report, I had stated the following:

March 2005: If gold and gold stocks remain in a bull market, the decline down to 89-84 zone ought to represent the last buying opportunity for gold and gold stocks prior to a spectacular bullish acceleration. If the XAU stays above 84 over the next 2-4 weeks and then it begins to accelerate to the upside, at this point in the bull market we ought to see a rise from its upcoming lows in the 89-85 zone in the next few weeks to a high in the 155-165 zone by the end of the year, which will represent an 100% gain.

-cut-

Now that we are in the middle of June, we can examine how things have unfolded so far, re-examine our assumptions, consider the possible scenarios going forward, adjust expectations, re-think and formulate strategies.

The first assumption that we need to examine is whether gold and gold stocks are still in a bull market. My conditions--strictly from a technical point of view--for concluding that the bull market in gold/gold stocks is still intact would be that in the worst case scenario the XAU didn't close below 81 for two consecutive weeks, and gold didn't close below $400 for two consecutive weeks. The XAU had one weekly close below 81 on 5-12-05, closing at 80.33. Since then it has rallied strongly, and gold itself never came close to $400.00, let alone closing below. Therefore, at the moment we must conclude that gold/gold stocks are probably still in a bull market. Why do I say "probably" and not "certainly?"

more...

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

[UpInArms]

2. daily dollar watch

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

Last trade 88.60 Change +0.42 (+0.48%)

Dollar Remains In Range Trading Mode

http://www.dailyfx.com/index.php?option=com_content&task=view&id=1733&Itemid=39

EUR/USD – Euro longs were invited for another rollercoaster ride as the pair bounced around 100 pip range with single currency testing bids and offers both sides of 1.2100-1.2200 range. Along with the price action in the majors, traders should expect euro crosses to retrace some of the losses they have sustained during the May sell off, especially in EUR/GBP and EUR/CAD. Indicators signal a trend reversal with ADX (DMI) on the daily chart at 39.77. Stochastic is neutral on the daily chart at 27.17. The Stochastic on the dealer (4HR) chart is neutral at 26.21. RSI is neutral on the daily chart at 39.70 with the 4-hour chart RSI also neutral at 51.81. MACD made a bullish crossover deep below the zero line on the daily chart and is flat above the zero line on the dealer (4HR) chart. In case the reversal fails greenback longs will most likely resume their advance and push the pair below the psychologically important 1.2000 figure.

<snip>

USD/JPY – Japanese Yen traders launched a surprising attack against the dollar longs and pushed the pair toward 108.00 figure. As the greenback traders consolidate their losses and prepare to launch a counteroffensive, market participants will most likely see the pair retreat toward the 109.00 figure. A retreat by the yen longs will most likely lend a helping hand to battered yen crosses such as EUR/JPY, which sustained heavy losses following a sudden yen rally, with cross tumbling below the 132.00 figure, but managing to find active bids around the 131.50 level. Indicators signal trend reversal, with ADX (DMI) dropping to 22.36. Stochastic is treading below the overbought line on the daily chart at 77.84 with Stochastic on the 4-hour chart neutral at 52.23, thus providing yen bulls with a chance to mount a counterattack. RSI is neutral at 53.69 on the daily chart, with dealer (4HR) chart also neutral at42.05. MACD remains above the zero line on the daily chart, while the MACD on the (4HR) chart has made a bearish crossover at the zero line.

...more...

Petroleum Inventory Reports due out this morning.

Have a Great Day Marketeers!

[UpInArms]

3. U.S. mortgage applications decrease last week-MBA

http://today.reuters.com/investing/FinanceArticle.aspx?type=economicNews&storyID=URI:urn:newsml:reuters.com:20050622:MTFH95710_2005-06-22_11-37-36_N10103329:1

NEW YORK, June 22 (Reuters) - Applications for U.S. home mortgages fell last week due to a sharp decline in purchasing and refinancing activity as mortgage rates rose slightly, an industry group said on Wednesday.

The declines erased much of the jump in mortgage activity from the preceding week when mortgages for home purchases reached a record peak.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity decreased 11.3 percent to 786.8 in the week ending June 17, erasing some of the previous week's 17.4 percent gain.

The MBA's seasonally adjusted index of refinancing applications dropped 13.2 percent to 2575.0, after rising 25.6 percent the prior week.

The MBA's purchase index, a gauge of loan requests for home purchases, fell 9.4 percent to 479.4, after climbing 10.4 percent to a record high the previous week.

...more...

[UpInArms]

4. Morgan Stanley 2nd-qtr earnings fall 24 pct

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T120713Z_01_WEN3672_RTRIDST_0_FINANCIAL-MORGANSTANLEY-EARNS-URGENT.XML

NEW YORK, June 22 (Reuters) - U.S. investment bank Morgan Stanley (MWD.N: Quote, Profile, Research) on Wednesday said second-quarter profit fell 24 percent on weak trading results and legal costs.

The banking, brokerage and credit card company said net income fell to $928 million, or 86 cents a share, in the quarter ended May 31, from $1.22 billion, or $1.10, in the year-earlier period.

[UpInArms]

5. Reuters Summit-Hedge fund strategies,assets, performance

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2005-06-22T075113Z_01_L14516814_RTRIDST_0_FINANCIAL-SUMMIT-EUROPE-STRATEGIES-FACTBOX.XML

LONDON, June 22 (Reuters) - Leading figures from London's
hedge fund community, the biggest in the world outside the U.S.,
are being quizzed by a team of Reuters journalists in a two-day
summit on Wednesday and Thursday this week about what is driving
the industry and its trading strategies.

Following are some definitions of hedge fund strategies,
estimates of their assets, number of managers in the strategies
and recent performance data:

Around 8,000 hedge funds are estimated to manage about $1
trillion, only a small proportion of total global assets of $90
trillion estimated by Morgan Stanley analysts, but double the
numbers in 2000.

Data provider Tremont Capital estimates hedge funds saw net
new flows of $24.6 billion in the first quarter of this year,
below the $38.2 billion in the first quarter of 2004.

...more...

[UpInArms]

6. a picture post - since they're worth a thousand words

[donkeyotay]

18. A picture may be worth a thousand

but this graph - showing the context of boosh's re-election, mandate, political capital - is worth a million. This deserves its own post and to be formatted to print better as I'll bet I'm not the only one who suddenly felt the need for 20 copies to pass around.

Thanks UIA!
:hi:

[RawMaterials]

32. based on that picture

looks like we are over du for some more "Binladden" "teror"

[AnneD]

28. Morning Marketeers

:donut: UIA, I think your graph needs a longer x axis (hope I remember that right). We are only 6 mos into a 4 year term so the question for all you limbo boys and girls is....how low can you go? Happy Hunting and watch out for the bears.

[UpInArms]

7. Webster chief named to Federal Advisory Council

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T124328Z_01_WEN3679_RTRIDST_0_FINANCIAL-WEBSTER-URGENT.XML

NEW YORK, June 22 (Reuters) - Webster Financial Corp. (WBS.N: Quote, Profile, Research) said on Wednesday its chief executive James C. Smith has been appointed to the Federal Advisory Council, a body which advises the U.S. Federal Reserve Board of Governors on general business conditions.

The board of directors for each of the 12 Federal Reserve banks chooses one member from its district to act as a representative on the council, typically for a three-year term.

[UpInArms]

8. Bear Stearns faces SEC action - it may be fined, sanctioned fo

http://www.marketwatch.com/news/story.asp?guid=%7B02D1BB4A%2D8D4E%2D4434%2D8F39%2D730DD998604C%7D&siteid=mktw

BOSTON (MarketWatch) -- The Bear Stearns Companies Inc. in a regulatory filing Wednesday said the Securities and Exchange Commission has authorized staff to bring an enforcement action against it and its Bear Stearns Securities Corp. unit over mutual fund trading.

<snip>

In February, the SEC fined broker Brean Murray $150,000 over improper trading of mutual fund shares on behalf of several hedge fund customers.

The SEC alleged that Murray accepted and executed trades on behalf of Canary Capital Partners and at least four other hedge funds after 4 pm, but at end-of-day prices, a practice known as "late trading."

Late trading gives traders an unfair advantage and harms long-term fund shareholders.

...more...

[UpInArms]

9. Ford cuts full-year profit outlook

http://www.marketwatch.com/news/story.asp?guid=%7BF178F2EF%2D1EC2%2D44CE%2D954F%2D0714F4643C32%7D&siteid=mktw

NEW YORK (MarketWatch) - Shares of Ford Motor Co. dipped in pre-market trading Wednesday after the automaker, faced with high costs and slumping sales, slashed its full-year profit target.

Ford's stock (F: news, chart, profile) fell more than 3.3% to $10.80 in pre-market trading, after adding 6 cents Tuesday to close the regular session at $11.17.

The No. 2 U.S. automaker said it expects to report a full-year profit in a range of $1 to $1.25 a share, down from prior estimates of $1.25 to $1.50 a share.

Standard & Poor's said Ford's debt ratings were unaffected for now but added it foresees and increased likelihood of a downgrade. "Accelerating deterioration in the North American market mix, intensifying price competition, poor acceptance of Ford's future new products, labor strife, and/or a weakening of the general economy could jeopardize the ratings," S& P said Wednesday. S&P currently rates Ford BB+, the first level of junk status.

Ford also said it would cut about 1,750 of its North American white-collar jobs, which amount to about 5% of its 35,000 salaried workers in North America. The cuts would take effect by Oct. 1.

...more...

[UpInArms]

10. 10-year Treasury below 4% as global growth questioned

http://www.marketwatch.com/news/story.asp?guid=%7BE52F4F52%2D6B77%2D4A8F%2D849B%2D07CE3DFFB970%7D&siteid=mktw

CHICAGO (MarketWatch) - The U.S. bond market drew its inspiration from Europe again on Wednesday, with Treasury prices rising and yields falling as dissention at the Bank of England in favor of an interest-rate cut highlights growing concern over global economic strength.

The 10-year Treasury yield, which is referenced for mortgage and corporate borrowing rates, fell below 4% to its lowest in nearly two weeks after climbing in anticipation of continued interest-rate increases at the Federal Reserve.

U.K. and eurozone government bonds soared for a second straight session, sending yields tumbling.

In early U.S. trading, the benchmark 10-year Treasury was up 11/32 at 101 1/32.

...more...

[UpInArms]

13. Fed adds reserves through overnight system RPs

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T133400Z_01_N22167750_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, June 22 (Reuters) - The Federal Reserve said on Wednesday it was adding temporary reserves to the banking system through overnight system repurchase agreements.

Fed funds last traded at 3.00 percent, at the Fed's current target for the rate on overnight loans between banks.

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

[UpInArms]

49. Benchmark Treasury yield flirts with 14-month low

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38525.6434095139-837123793&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

CHICAGO (MarketWatch) -- The closely tracked 10-year Treasury note finished U.S. trading Wednesday with a yield just above the 14-month low hit on June 8. The note had gained 26/32 to 101 16/32. Its yield fell to 3.942% compared to 4.07% Tuesday and 3.940% on June 8. Prices have gained and yields tumbled anew this week as bond investors contemplate whether the Federal Reserve is nearly finished raising U.S. interest rates and as broader European interest rates may head lower to ward off a more dramatic slowdown in global consumption. Benchmark yields were last regularly below 3.9% in April and March of 2004.

[UpInArms]

11. pre-opening blather

briefing.com

9:15AM: S&P futures vs fair value: +4.2. Nasdaq futures vs fair value: +7.5.

9:00AM: S&P futures vs fair value: +4.4. Nasdaq futures vs fair value: +7.5. Expectations remain set for the cash market to open higher, as futures indications hold steady well above fair value... Even in the absence of notable economic data and corporate news to account for this morning's bounce, benchmark yields at 3.98% are providing some support for stocks in the early going... Perhaps also improving sentiment has been strength in overseas markets, as the Nikkei closed at its highest level since mid-April and the Hang Seng surged 1.3%

8:30AM: S&P futures vs fair value: +4.4. Nasdaq futures vs fair value: +7.5. Positive bias persists in pre-market trading, setting the stage for stocks to open on an upbeat note... As expected, Morgan Stanley (MWD) has recently posted Q2 earnings below forecasts, but revenues were better than expected and MWD has said it will continue to analyze the merits of a spin-off... Meanwhile, investors may also be taking a bullish cue from declining bond yields, as benchmark rates have fallen below 4.0% amid concerns of slowing global growth

8:00AM: S&P futures vs fair value: +4.6. Nasdaq futures vs fair value: +7.5. Futures market versus fair value suggesting a higher open for the cash market amid falling oil prices ahead of weekly inventories data... Meanwhile, Ford (F) has lowered FY05 earnings guidance due to a weaker outlook for vehicle sales and Morgan Stanley (MWD) may say Q2 profits fell as much as 20%...

ino.com

The September NASDAQ 100 was higher overnight and is breaking out above the 20-day moving average crossing at 1552.05. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above last Friday’s high crossing at 1562.50 would signal that the decline off May's high has come to an end. If September extends this month's decline, the 38% retracement level of the April-June rally crossing at 1519.09 is the next downside target. The September NASDAQ 100 was up 4.50 pts. at 1555.50 as of 5:45 AM ET. Overnight action sets the stage for a steady to higher opening by the NASDAQ composite index later this morning.

The September S&P 500 index was higher overnight as it extends the recent breakout above the 75% retracement level of this year's decline crossing at 1212. Stochastics and the RSI are overbought, diverging but are neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends this spring's rally, the contract high crossing at 1235 is the next upside target. Closes below the 20-day moving average crossing at 1208.60, would confirm that a short-term top has been posted. The September S&P 500 Index was up 2.70 pts. at 1223.60 as of 5:48 AM ET. Overnight action sets the stage for a steady to higher opening when the day session begins later this morning.

[UpInArms]

12. 9:37 EST open for bidness

Dow 10,640.72 +41.05 (+0.39%)
Nasdaq 2,101.95 +10.88 (+0.52%)
S&P 500 1,219.39 +5.78 (+0.48%)
10-Yr Bond 3.984 -0.65 (-1.61%)

NYSE Volume 63,639,000
Nasdaq Volume 94,851,000

9:40AM: Market opens higher, as plummeting bond yields improve borrowing costs for both consumers and corporations... The 10-year note (+13/32) has extended gains, knocking benchmark yields to as low as 3.98%, as worries of slowing global growth - spurred in large-part by record high energy costs - have underpinned the attractiveness of higher-yielding U.S. investments... Yesterday, a move by Sweden's central bank to cut its benchmark rate to a record low of 1.50% - a move that may pressure the ECB to cut its benchmark rate as well - helped fuel a rally in U.S. Treasurys...

(added blather on edit)

[UpInArms]

14. GE, CNA get reinsurance subpoenas from prosecutors

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T133508Z_01_N20540384_RTRIDST_0_FINANCIAL-INSURANCE-SUBPOENAS-CORRECT.XML

NEW YORK, June 20 (Reuters) - General Electric Co. (GE.N: Quote, Profile, Research) and CNA Financial Corp. (CNA.N: Quote, Profile, Research) on Monday said they received subpoenas from federal prosecutors in a widening probe of a type of reinsurance that insurers might use to smooth their own earnings.

At least 10 companies have reported receiving subpoenas related to finite reinsurance from David Kelley, the U.S. Attorney for the Southern District of New York.

The others include Ace Ltd. (ACE.N: Quote, Profile, Research), Assurant Inc. (AIZ.N: Quote, Profile, Research); Bristol West Holdings Inc. (BRW.N: Quote, Profile, Research); PartnerRe Ltd. (PRE.N: Quote, Profile, Research); Platinum Underwriters Holdings Ltd. (PTP.N: Quote, Profile, Research); RenaissanceRe Holdings Ltd. (RNR.N: Quote, Profile, Research). St. Paul Travelers Cos. (STA.N: Quote, Profile, Research) and XL Capital Ltd. (XL.N: Quote, Profile, Research).

Authorities are examining whether some nontraditional reinsurance products function as loans to help insurers hide losses, and if they transfer enough risk. The U.S. Securities and Exchange Commission and New York Attorney General Eliot Spitzer have also issued subpoenas related to the product.

...more...

[UpInArms]

15. Gannett: TV ad revenue softer than expected in Dec.

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38525.4138761806-837110452&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

NEW YORK (MarketWatch) -- Broadcast revenue growth at Gannett Co., Inc. (GCI) this year has been softer than the media group projected in December, Gracia Martore, chief financial officer, said at the NAA Mid-Year Media Review conference. Craig Dubow, CEO of Gannett Broadcasting, highlighted auto and retail advertising spending as challenging - the top two categories for the division. The two categories have seen "a slight uptick in the past two weeks" but are expected to remain at a "negative pace" against the same quarter a year ago, he said. He made clear that the recent consolidations among a couple of leading U.S. retailers have created an unknown at this point for the group in back-to-school spending.

When there is only one store left there will be no need for advertising. :eyes:

[UpInArms]

16. 10:07 EST numbers and blather

Dow 10,616.78 +17.11 (+0.16%)
Nasdaq 2,095.34 +4.27 (+0.20%)
S&P 500 1,216.41 +2.80 (+0.23%)
10-Yr Bond 4.001 -0.48 (-1.19%)

NYSE Volume 243,736,000
Nasdaq Volume 276,665,000

10:00AM: Equities still on the offensive as the bulk of sector leadership remains positive... Even as oil prices remain volatile ahead of the EIA's weekly inventories report (10:30 ET) - crude oil supplies (consensus -2.0 mln), gasoline stockpiles (consensus +50K) and distillates (consensus +2.0 mln) - Energy has been the best performing economic sector... Interest-rate sensitive areas like Financial and Utilities have posted modest gains, as bond yields continue to fall, while Technology has been strong across the board...

Consumer Discretionay has also shown relative strength, as gains in retail have offset weakness in autos and homebuilding... SOX +0.4, NYSE Adv/Dec 1913/649, Nasdaq Adv/Dec 1677/693

(oops! forgot the blather)

[UpInArms]

17. PIEHOLE ALERT

10:10am 06/22/05 BUSH: NOT TAKING GOOD ECONOMIC NUMBERS FOR GRANTED

10:08am 06/22/05 BUSH: MANY WORRIED ABOUT ECONOMY DESPITE 'GOOD NUMBERS'

(secretly admitting that numbers are "cooked"?)

[UpInArms]

20. more spew

10:20am 06/22/05 BUSH: U.S. MUST START BUILDING NUCLEAR POWER PLANTS

10:17am 06/22/05 BUSH SAYS NUCLEAR PLANTS 'FAR SAFER' THAN IN 1970S

10:13am 06/22/05 BUSH: CONGRESS MUST COMPLETE ENERGY BILL BY AUG. RECESS

[punpirate]

27. No, what Bush actually said was...

... "nuke-you-lar plants are far safer."

And, how the hell would he know?

[UpInArms]

31. maybe he talked with these folks

but... then again, maybe not :(

[UpInArms]

19. Oil prices up ahead of supply data

http://www.marketwatch.com/news/story.asp?guid=%7B0A56F857%2D3E97%2D4959%2DBC22%2DACD8C2246A45%7D&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Oil futures edged higher early Wednesday, with most traders betting on a decline in last week's U.S. crude inventories.

The Energy Department and American Petroleum Institute will release separate reports after 10:30 a.m. Eastern on oil supply data covering the week ended June 17.

Ahead of the data, August crude traded at $59.15 a barrel, up 11 cents. July unleaded gasoline shed 0.44 cent, or 0.3 percent, to $1.623 a gallon and July heating oil added 0.53 cent, or 0.3 percent, to stand at $1.635 a gallon.

"It's possible that our supply report could potentially reinforce the tight supply fears," Phil Flynn, a senior analyst at Alaron Trading said in a note to clients.

"The growth of oil demand ... is showing no signs of abating," he said, and the "imbalance in product supplies and the tightness in refining capacity and this could easily set the stage today for a quick test of $60 per barrel."

Analysts at Fimat USA expect the data to show a 600,000-barrel decline in crude inventories. IFR Markets expects supplies to have remained unchanged or fallen by as much as 1 million barrels. Alaron sees a decline of around 3 million.

...more...

[UpInArms]

21. Chicago Fed national activity index rises (to 0.1) in May

WE'RE RICH! RICH, I TELL YOU!

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T140522Z_01_CHB000047_RTRIDST_0_ECONOMY-FED-CHICAGO.XML

CHICAGO, June 22 (Reuters) - The Federal Reserve Bank of
Chicago on Wednesday said its gauge of the national economy rose
in May, boosted by strength in production and housing-related
indicators.

The Chicago Fed said its National Activity Index increased to
+0.10 in May from a downwardly revised +0.05 in April.

The three-month moving average of the index was steady at
-0.01 in May after slipping into negative territory in April for
the first time in almost two years.

Any reading below zero suggests economic growth is below its
historical trend. The average had shown above-trend growth for 20
straight months before the April average was revised to -0.01 from
+0.08 originally reported.

...more...

[UpInArms]

22. DOE Petroleum Inventory Report

10:30am 06/22/05 U.S. CRUDE STKS DOWN 1.6 MLN BRLS LAST WK: ENERGY DEPT

10:32am 06/22/05 U.S. GASOLINE STKS UP 200,000 BRLS LAST WK: ENERGY DEPT

10:32am 06/22/05 U.S. DISTILLATE STKS UP 1.3 MLN BRLS LAST WK: ENERGY DE

10:31am 06/22/05 AUG CRUDE UP 16C AT $59.20/BRL ON U.S. SUPPLY FALL

(API report due in 15 minutes)

[UpInArms]

26. Here are the API numbers

http://api-ec.api.org/media/index.cfm?objectid=05834D44-4071-48AD-ABB4FEFC7BB1478B&method=display_body&er=1&bitmask=001007000000000000

excerpt:

Crude oil stocks fell in May from April by 2.4 percent but were still up 7.7 percent from May 2004. Cumulatively, they increased nearly 40 million barrels since the beginning of the year, a rise of more than 13 percent. This was nearly double the average January-to-May build in crude oil inventories for the previous five years, API reported.

Gasoline inventories continued above 210 million barrels for the seventh consecutive month, ending at 212.5 million barrels, slightly below April but four percent above May a year ago, with a significantly greater increase for finished reformulated gasoline than for conventional gasoline.

Petroleum imports into the United States rose 3.3 percent in May compared with a year ago, to an average of 13.4 million barrels per day. Product imports were up 13 percent compared with the same month last year to 3.0 million barrels per day. Crude oil imports reached 10.4 million barrels per day, just short of the all-time high of 10.5 million barrels in June 2004.

May’s domestic crude oil production rose to nearly 5.5 million barrels per day, though still down 2.5 percent from a year ago. Lower-48 and Alaska output both rose, API said. The year-to-year decline in domestic crude production marks the 19th consecutive month this has occurred.

With unseasonably cold weather in May, distillate deliveries rose 7 percent compared with a year ago, the largest rise in more than two years. At 24 percent, the increase for high-sulfur distillate used in home heating was much greater than the two-percent increase for low-sulfur distillate used by diesel-powered vehicles on highways. Diesel prices averaged $2.16 for the month, about 9 percent higher than a year ago, partly reflecting the growing economy’s strong demand for transportation fuel, API reported.

Deliveries of residual fuel oil, used primarily for electric generation and vessel bunkering, were up 6.5 percent from a year ago, with an increase for the year to date of 4.4 percent, API said. Kerosine jet fuel deliveries rose sharply by 8.5 percent from a year ago.

Date: 20 Jun 2005

[UpInArms]

23. Carter's (baby apparel) closing 2 Mexico plants - moving to China

Carter's rallies amid plan to close 2 sewing facilities

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38525.4443936806-837112499&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) -- Shares of Carter's Inc. (CRI) climbed 5% after the baby sleepwear maker disclosed late Tuesday that it closing its remaining two sewing facilities in Mexico. The company expects to save about $5 million a year from the closures given the lower costs associated with outsourcing these products in Asia. Meanwhile, the company expects to record a 19 cents a share charge in the second quarter, a 7 cents a share charge in the third quarter, a 3 cents a share charge in the fourth quarter and a 2 cents a share charge in the first five months of 2006. The stock was last up $2.72 at $57, and had reached an all-time high of $57.40 in intraday trading.

The race to the bottom continues :sigh:

[UpInArms]

24. U.S. state personal income growth slows in Q1

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-22T145157Z_01_N22677245_RTRIDST_0_ECONOMY-INCOME-STATES.XML

WASHINGTON, June 22 (Reuters) - Personal income growth slowed for all U.S. states except Rhode Island in the first quarter of 2005 from the previous quarter, when big corporate dividends boosted incomes, the Commerce Department said on Wednesday.

National growth in personal income slowed to 0.7 percent from 3.3 percent in the fourth quarter of 2004 and did not keep pace with the 0.8 percent inflation rate as measured by the price index for personal consumption expenditure, the Commerce Department's Bureau of Economic Analysis said.

In the fourth quarter of 2004, a special one-time payout by Microsoft Corp. (MSFT.O: Quote, Profile, Research) of $32 billion, or $3 a share, combined with bonuses and other lump-sum wage disbursements to make income growth the strongest in four years.

But states could not sustain this level of growth in the first quarter, the bureau said.

Excluding the Microsoft special dividend, the bureau estimated that national personal income growth would have been 1.7 percent in the first quarter and 2.3 percent in the fourth quarter of 2004.

...more...

[UpInArms]

25. 11:06 EST numbers and blather (where is that API?)

Dow 10,590.99 -8.68 (-0.08%)
Nasdaq 2,085.08 -5.99 (-0.29%)
S&P 500 1,212.59 -1.02 (-0.08%)
10-Yr Bond 3.997 -0.52 (-1.28%)

NYSE Volume 539,239,000
Nasdaq Volume 581,662,000

11:00AM: Sellers show some resolve within the last 20 minutes, knocking the indices to session lows and into negative territory for the first time this morning... Even though bond yields and oil prices remain near session lows - supportive factors for the market - the fact that several stocks have been trading near the upper end of their ranges suggests that a market top may be in the offing...NYSE Adv/Dec 1848/1101, Nasdaq Adv/Dec 1580/1106

10:30AM: Major indices holding onto to modest gains, finding leadership from the influential financial sector... While plummeting bond yields have improved borrowing costs for both consumers and corporations, the financial sector has gotten an additional boost from some upbeat news in the brokerage group... Even though Q2 profits at Morgan Stanley (MWD 51.10 +0.13) fell 24% from a year ago, the disappointment was widely expected, revenues checked in at $6.04 bln (consensus $5.63 bln) and the company has also reaffirmed the possible spin-off of its Discover division...

A last-minute bid by E*TRADE Financial (ET 13.22 +0.31) for Ameritrade (AMTD 15.16 +0.34), which has confirmed plans to acquire TD Waterhouse (TD 44.38 +0.77) for $3.0 bln, has also provided support..NYSE Adv/Dec 1775/1060, Nasdaq Adv/Dec 1562/1002

[ozymandius]

29. lunchtime check-in

12:05
Dow 10,598.44 -1.23 (-0.01%)
Nasdaq 2,086.57 -4.50 (-0.22%)
S&P 500 1,213.00 -0.61 (-0.05%)
10-Yr Bond 39.99 -0.50 (-1.23%)
NYSE Volume 766,550,000
Nasdaq Volume 784,350,000

12:00PM: Market still struggles to gain much traction midday as investors weigh profit-taking opportunities against plummeting bond yields and falling oil prices and sector leadership remains mixed... With no economic data scheduled for this morning, investors have looked to the Treasury market and oil prices for some direction in market that continues to trade near 3-month highs...

Since bonds don't provide as attractive an alternative to stocks when yields are low, another rally in Treasurys - amid concerns of slowing global growth - has knocked benchmark yields on the 10-year note (+12/32) down to 3.99%... However, implications that a market top may be in the offing, as many stocks trade near the upper end of their ranges, has underpinned a sense of nervousness to more aggressively step back into the market following last week's strong performance... Of the seven economic sectors trading lower, Energy has paced the way to the downside, recently turning negative as crude oil prices ($58.20/bbl -$0.84) continue to deteriorate following mixed inventories data...

Crude oil inventories (consensus -2.0 mln) while gasoline supplies rose 197K barrels (consensus +50K) and distillates rose 1.37 mln (consensus +2.0 mln)... Technology has also been weak, as gains in hardware have failed to offset losses in software, semi and networking... Consumer Discretionay has been under pressure, amid weakness in autos, following Ford's (F 10.72 -0.45) downside FY05 guidance, and homebuilding stocks, which continue to trade near all-time highs... Interest-rate sensitive areas like Financial and Utilities, however, have posted modest gains...

[UpInArms]

33. 1:08 EST numbers and blather (all good again)

Dow 10,617.93 +18.26 (+0.17%)
Nasdaq 2,094.10 +3.03 (+0.14%)
S&P 500 1,215.55 +1.94 (+0.16%)
10-Yr Bond 3.987 -0.62 (-1.53%)

NYSE Volume 963,687,000
Nasdaq Volume 954,641,000

1:00PM: Market still confined to a relatively tight trading range, as both buyers and sellers continue to stick to the sidelines... Catching a bid amid the lackluster action, however, have been utilities stocks, as the Dow Utilities Index now trades at its best levels in four years... While falling bond yields make dividend-paying stocks more attractive to investors seeking income, reports that Warren Buffett - who has set aside $40 bln in cash for possible acquisitions - plans to invest heavily in power plants has also lent some support...

However, as the least influential sector in the S&P, a 0.5% gain in utilities has had little impact on the overall market... NYSE Adv/Dec 1581/1540, Nasdaq Adv/Dec 1384/1494

12:30PM: Indices now trade in split fashion, but market internals still suggest a slightly negative bias... Decliners on the NYSE hold a slim 8 to 7 advantage over advancers while declining issues on the Nasdaq hold a 15 to 13 edge over advancing issues... The Dow, S&P and Nasdaq continue to find support near key technical levels, however, it remains to be seen if resistance levels of 10627, 1217 and 2098, respectively, can be breached... NYSE Adv/Dec 1493/1601, Nasdaq Adv/Dec 1332/1503

[54anickel]

34. Hey UIA & Ozy, did you catch last weeks Credit Bubble Bulletin?

It gets into the consequences of putting off "paying the fiddler". Pretty much what ol Greenspin's been doing. :hi:

http://www.prudentbear.com/creditbubblebulletin.asp
(Last article on the page again)

To Liquidate or to Inflate?

snip>

Mr. Mellon was recognized by his contemporaries as a brilliant and compassionate American policymaker, businessman, philanthropist and statesman. Yet economic historians – not unjustifiably so – deride him for his most famous “tough love” approach to the “roaring twenties” hangover:

“Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. … It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people.”

It helps to appreciate the backdrop for Mr. Mellon’s comment. By the late-‘20s, he and others had grown quite concerned over what they considered a momentous inflationary boom that had transpired since the end of the First World War. Having witnessed recurring inflationary booms and subsequent painful busts during the second half of the nineteenth century, he believed that restraint and hardship were the only viable antidote for an extended period of excess. A difficult adjustment period was necessary to restore the financial and economic systems to stability, in the process returning both businessmen and workers to more industrious pursuits. Deflation must follow the inflationary boom because attempts to sustain the inflated price level, with its attendant profligacy and speculation, would prove futile, only spurring more dangerous excesses and imbalances. Sustaining or reigniting booms – while failing to “purge” unsound elements - would necessitate only more arduous and protracted adjustment periods.

It is worth pondering the merits of Mr. Mellon’s philosophy, if for no other reason than it is the antithesis of contemporary monetary and economic thinking. The notion that anything should be "Liquidated" or "purged" is dismissed out of hand. Apparently, there is virtually no financial or economic problem that cannot be rectified by Federal Reserve “reflationary” policies. No costs to over-consumption, uneconomic investment, over-borrowing or gross speculation that the Fed cannot easily mitigate. Furthermore, our “moral life” and “values” are supposedly enhanced by rising home, stock and bond prices; speculating in the markets and on mortgage rates has become the applauded social norm.

Meanwhile, the most “competent” individuals are today celebrated for profiting from rising asset prices, MBS spread trades and myriad opportunities for “financial arbitrage.” The massive wealth transfer to these “competents” is rationalized in terms of Adam Smith's "invisible hand" and Schumpeter’s “creative destruction.” The very foundation of contemporary “conservative” notions of economic wealth creation rests upon inflating house and securities prices, as well as with the creation and accumulation of financial claims. We are to focus on “intellectual output” and let others ship us their wares and energy resources.

more...

[UpInArms]

40. thanks for that one 54anickel!

I had missed it -

It was after all of that (the Great Depression) that FDR (and the Congress) put in all of the safeguards for the financial security of this country. It is such a shame to see those very safeguards be abused and misused by the reich-wing fanatics - to continue their transfer of wealth and power to the uber-rich.

:(

[54anickel]

41. Speaking of the transfer of wealth....

American Dreams; Personal Stories; the Next Phases of War

http://www.321energy.com/editorials/pollock/pollock062105.html

snip>

At this point, the specter of an economic slowdown looms in the near distance, ready to sweep down upon us. Yet even at this early juncture towards downturn, stories from the economic walking dead abound. The people I am talking about reside in the shadows of the middle class. They are wraiths, ghosts.

The walking dead shamble down the aisles of Walmart, looking not for cheap Chinese consumer goods but instead for sustenance, foodstuffs. These people cannot afford a $67 air conditioner, or the power to run it. In food’s stead they will encounter product from the merchants and lobbyists heralding death, the great food processors, Conagra, Tyson, and others. The ghost of America past clutches desperately for the name brands of a middle class existence.

snip>

In contrast we have another family, the “haves,” living a leveraged existence by supersizing their primary residence and flipping houses. To the consumption-driven, a home equity spiral can be a wonderful thing. Unfortunately for them, the “house rich” have built their fantasy on the theory of the “greater fool.”

The personal stories I have told disclose to you a trend: contraction. In credit contraction, fraud will hatch out. It’s been very interesting that government has been an active partner in facilitating and extending to the people a real estate boom. It is a Ponzi scheme; a fraud-scheme timed to the advent of war.

It is not surprising, because the economics and politics of war are bedfellows of the same dynamic, which is failure. The quality of economic activity has been poor, but the boom has been used as a tool to cloud reality. War and economic failure are synonymous.

snip>

Dictatorial interests use the forces of conflict to concentrate anger away from themselves. Lobbyists for special interest groups, both corporate and religious, have become so intractably entrenched in our governance that we live under a new type of despotism. So destructive has the force of tyranny become that we are legally obligated to cast it off. However, American tyranny has no identifiable center and will not easily be toppled.

more...

[ozymandius]

43. Thanks 54anickel.

Mr. Mellon's time certainly rhymes with our own.

[54anickel]

46. Yes, what's that saying about history may not repeat but it does rhyme? Or

something to that effect.

[UpInArms]

30. Cisco to boost China outsourcing to 40% by end '06 - AP

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38525.5011701157-837116203&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- Cisco Systems Inc. (CSCO) plans to boost China's share of its outsourcing budget to 40% by the end of 2006, the Associated Press reported on Wednesday, citing a company executive. Jia-Bin Duh, president of Cisco's China operations, wouldn't tell the AP how much the company will spend this year, but noted that it spent about $5 billion on outsourcing in China in 2004, or 25% of its global total.

[54anickel]

35. When the big boys buy

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=44172

Imagine owning a stock that you find out Warren Buffet is about to buy or learning that the property next to your raw land had just been purchased for a billion dollar development. You’d be more than a little excited and rightly so. We know that the investment actions of large investors, who going forward, I’ll call the big boys, have a major impact on our much smaller investments. In this article we will look at the ultimate big boy, who not only has the power to make huge purchase, but also can print the money needed to do so.

Let’s start with the Federal Reserve Bank of New York’s description of open market operations, one of the powers of the Federal Reserve. The Fed can “buy or sell U.S. Government Securities in the open, or secondary, market as one of its most flexible means of carrying out its objectives.”1

So, if we know that the Federal Reserve can buy or sell U.S. Government Securities then the most logical next question would be, how much do they trade? According to the Federal Reserve Bank of New York’s, in 2003 they traded $454 billion through their 22 primary dealers. 2

While it goes without saying that the Federal Reserve is a “big boy”, the record regarding their sizable buys and sells of U.S. government bonds, makes it increasingly clear that the Federal Reserve is not a heady bunch of uninterested, laizzes-fair economist relegated to studying reams of economic statistics. They are also a major player who continuously exerts a substantial influence on our bond markets, and therefore our markets as a whole.

snip>

When the big boys act, we are affected. My concern is that Fed monetary policy will have an effect, but not the one intended. Rather than averting an economic downturn, the Fed actions may have exacerbated the problem while lulling the public to sleep. Bernanke himself states, “I should emphasize that my comments on this topic are necessarily speculative, as the modern Federal Reserve has never faced this situation nor has it pre-committed itself formally to any specific course of action should deflation arise.” 11

Never has there been a greater need to exercise critical thinking and gain a historical perspective of the markets. Our financial futures hang in the balance.

more...

[54anickel]

36. The Road to Riches Is Called K Street

I want my country back!!!

http://www.washingtonpost.com/wp-dyn/content/article/2005/06/21/AR2005062101632.html

To the great growth industries of America such as health care and home building add one more: influence peddling.

The number of registered lobbyists in Washington has more than doubled since 2000 to more than 34,750 while the amount that lobbyists charge their new clients has increased by as much as 100 percent. Only a few other businesses have enjoyed greater prosperity in an otherwise fitful economy.

The lobbying boom has been caused by three factors, experts say: rapid growth in government, Republican control of both the White House and Congress, and wide acceptance among corporations that they need to hire professional lobbyists to secure their share of federal benefits.

"There's unlimited business out there for us," said Robert L. Livingston, a Republican former chairman of the House Appropriations Committee and now president of a thriving six-year-old lobbying firm. "Companies need lobbying help."

snip>

Political historians don't see these as positive developments for democracy. "We've got a problem here," said Allan Cigler, a political scientist at the University of Kansas. "The growth of lobbying makes even worse than it is already the balance between those with resources and those without resources."

What's all that talk about spreading democracy again? :grr:

more...

[54anickel]

37. I Think I Swallowed my Tongue! (Mogambo)

http://www.321gold.com/editorials/daughty/daughty062205.html

snip>

This, of course, brings to mind the words of Thomas Jefferson, one of the most remarkable men America has ever produced (and who is, parenthetically, my entry as "The Greatest American"), who was ALSO not insane. He said, "If the American people ever allow private banks to control the issue of currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered." And where will their homes be? Owned by the banks, along with everything else!

snip>

But Mr. Puplava of FinancialSense.com is not interested in my tomato problems, but instead harks back to my earlier remarks about fiat currencies, and notes wryly, "Ironically, it was the abuse of the gold standard, the Fed's credit-creating habits of the 1920s, and its subsequent mischief in the 1930s, that not only gave us the Great Depression, but also prolonged it. When the government can replicate the monetary unit at will without regard to cost, whether it's paper currency or a computer entry, it's morally identical to the counterfeiter who illegally prints currency. Both ways, it's fraud."

And how does this all fit into my screeching denunciation of the banks? Easy! As I get ready to launch into one of my famous Mogambo diatribes (FMT), Mr. Puplava sees what is happening, and frantically jumps in and takes over for me. He says "A fiat monetary system allows power and influence to fall into the hands of those who control the creation of new money, and to those who get to use the money or credit early in its circulation." Well, the obvious question is, "If power, influence and money accrue to those who create fiat money (the banks), who pays the cost?" I threw myself that softball question so that I can get a few words in, but before I can answer that question, Mr. Puplava again beats me to the punch with the answer, "The insidious and eventual cost falls on unidentified victims who are usually oblivious to the cause of their plight. An actual transfer of wealth goes from the poor and the middle class to those in privileged financial positions."

And if you think that Greenspan and his horrible, dimwitted cronies at the Federal Reserve are so much smarter than all the other countries in all of history who have tried this crap and failed, then guess again. Mr. Puplava reports "In many societies the middle class has actually been wiped out by monetary inflation, which always accompanies fiat money."

Well, if this is true, why doesn't anybody try and stop it? Again, he has an answer ready. "In the early stages of inflation, the business class actually benefits from the easy credit. An astute stock investor or home builder can make millions in the boom phase of the business cycle." That is why they call it a boom. And to make sure that you understand the ramifications of this insidious inflation, he adds that "The poor and those dependent on fixed incomes can't keep up with the rising cost of living."

more...

[UpInArms]

38. Moody's may downgraded Ford Motor to junk

http://www.marketwatch.com/news/newsfinder/archivedpulseone.asp?archive=pulsetrue&dist=ArchiveSplash&siteid=mktw&guid=&dateid=38525.5929913657-837121081&returnURL=%2Fnews%2Fnewsfinder%2Fpulseone%2Easp%3Fdateid%3D38525%2E5929913657%2D837121081%26siteID%3Dmktw%26scid%3D0%26doctype%3D806%26property%3Dsymb%26value%3D%26categories%3D%26archive%3Dpulsetrue

NEW YORK (MarketWatch) -- Moody's Investors Service said it was reviewing Ford Motor Co.'s (F) long-term debt rating, currently at the lowest investment grade rating of Baa3, for possible downgrade following the automaker's lowered earnings outlook. Moody's is also reviewing the Baa2 long-term debt rating, which is 2 notches above junk, of its financing arm, Ford Motor Credit, for a possible downgrade. Moody's feels the "very significant and continued reduction in Ford's North American earnings outlook reflects the escalating competitive and cost challenges the company faces." The stock was last down 54 cents, or 4.8%, at $10.63. The company said late Tuesday that it expects 2005 earnings of $1 to $1.25 a share, down from prior projections of $1.25 to $1.50 a share.

[54anickel]

39. 2:28 update

Dow 10,592.07 -7.60 (-0.07%)
Nasdaq 2,089.92 -1.15 (-0.05%)
S&P 500 1,213.41 -0.20 (-0.02%)
10-Yr Bond 3.968% -0.08
NYSE Volume 1,223,826,000
Nasdaq Volume 1,166,447,000

2:00PM: Stocks retreat from recent levels and now trade right around the flat line even as ongoing momentum in bonds sends benchmark yields (3.96%) to session lows... While lower interest rates raise the current value of future earnings, and thus increase the current value of stocks, the latest resurgence in Treasurys - as the 10-year note is now up 20 ticks - has failed to incite the kind of buying interest evidenced when the market opened and the 10-year note was up about 10 ticks... NYSE Adv/Dec 1785/1411, Nasdaq Adv/Dec 1543/1400
1:30PM: Market rebounds some but not nearly enough to make a significant change in the standings... Providing the bulk of the upside move has been a turnaround in technology... Of the S&P Tech Index's 88 components, Jabil Circuit (JBL 31.23 +2.79) has been the best performer, hitting a 52-week high after posting 48% earnings growth and providing encouraging guidance...

Motorola (MOT 18.60 +0.38) has also provided a lift, recently spiking to intra-day highs following upbeat comments out of Thomas Weisel regarding retail shelf space gains and after Banc of America Securities raised its forecast for handset shipments...NYSE Adv/Dec 1795/1373, Nasdaq Adv/Dec 1583/1326

[UpInArms]

42. A Hole for the Ruling Donut Co: More Bad News Ahead?

http://www.forbes.com/business/feeds/ap/2005/06/22/ap2105900.html

Krispy Kreme Doughnuts Inc.'s ouster of six executives suggests more negative news may be ahead, according to analysts who follow the snack-maker.

A special committee of the company's independent directors decided the six unnamed company officers should be fired, Krispy Kreme said Tuesday. Five of the executives have resigned and one has retired.

The committee was appointed in October to investigate issues raised by a Securities and Exchange Commission inquiry and by the company's auditors about accounting and financial statements, as well as claims of negligence in a shareholders' lawsuit was filed last year.

"The sudden removal of these executives points to far-reaching abuse within the former management ranks of this company," John Ivankoe, an analyst with J.P. Morgan Securities Inc., wrote in a report to investors. "We also see this announcement increasing the likelihood of significant findings from current SEC and Department of Justice investigations."

The SEC is investigating the company's repurchase of franchises and the earnings warnings in May 2004 that started the company's swoon. The company is also under investigation by the U.S. Attorney's Office for the Southern District of New York.

...more...

[ozymandius]

44. Call me a jerk for stating the obvious, but we can safely say

there's a hole where the dough should have been.

:eyes:

[UpInArms]

45. will they claim they ate all the profits?

or are they just arse-holes?

:rofl:

[54anickel]

47. Bankruptcy - Just do it!

http://www.bullnotbull.com/bull/Article69.html

If the idea of declaring bankruptcy has been on your mind recently, the time to act is now. The new bankruptcy law, signed by President Bush in April, is set to take effect in October of this year. The law makes it much more difficult, if not impossible, for people with unmanageable debts to get a fresh financial start in life. Furthermore, the law is slated to take effect just as new credit card policies doubling average monthly minimum payments is set to take effect. If your payments are just barely manageable now, they will soon be unmanageable, just as the bankruptcy window slams shut.

Take heed of the situation that is unfolding, and act accordingly.

The Dilemma

Like many others I know, my friend K has credit card debt that is overwhelming. Her monthly expenses for food, housing, and transportation plus credit card payments are just about equal to her monthly salary. She has absolutely no leeway. Any unexpected expenditures can (and regularly do) put her over the edge. Some months, she ends up charging her groceries and other expenses, putting her further into debt. K is no sloth, either. She has a regular day job and a part time job cleaning houses to help make ends meet. Even so, she is falling behind financially. She has no savings to speak of, and her life is consumed with work and money worries, of how or if she will ever be able to get ahead. At $500, her monthly credit card minimums are the second largest expense on her balance sheet, after housing. Even so, with the high rates that she is paying, about $475 ends up going to the bank for interest, with only $25 going to paying off principal! This is scandalous, and at another point in American history, it would have been called usury. Today it is simply called business, American style.

The way things are going, she knows her credit card balances will never be paid off.

Apparently, the banks have realized this too, because they are raising monthly minimum payments right around October, (conveniently) just as the new, tougher bankruptcy laws go into effect. According to this article in the Houston Chronicle, and this article at About.com minimum payments could double, from 2% of principle to 4%. This would mean that my friend K would suddenly have a $1,000 minimum payment to make each month!

snip>

Larger Context: The Big Squeeze

The new credit card minimums and bankruptcy law are taking part against a larger backdrop of rising prices and falling wages. Just look at what is happening in the world around us:

more...

[UpInArms]

48. (Yuma Arizona) Excel Group to lay off 180

http://sun.yumasun.com/artman/publish/articles/story_17384.php

Behavioral health care provider The Excel Group on Tuesday announced it will lay off up to 180 employees in 60 days.

The layoffs are the result of a reduction in Excel's contracts with Cenpatico, the Texas-based managed-care company that will take over as the region's behavioral health authority on July 1.

The staff reduction is more extensive than anticipated when Cenpatico executives in late April announced their intent to subcontract with Excel and shift administrative responsibilities and the area's 24-hour crisis call center to Tempe.

The larger numbers result from Cenpatico's decision to contract with other agencies to perform some of the services previously handled by Excel.

Cenpatico did not return several calls placed by The Sun Tuesday seeking comment on the transition, its soon-to-be formalized contract with Excel, or any other agencies with which Cenpatico plans to contract for mental health and substance-abuse treatment.

...more...

[UpInArms]

50. Boeing to recognize $350M pre-tax loss on Onex sale

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38525.6400873495-837123641&siteID=mktw&scid=0&doctype=806&property=symb&value=&categories=&

SAN FRANCISCO (MarketWatch) -- Boeing Co. (BA) will recognize a pre-tax loss of $350 million from the recently completed sale of its commercial airplanes operations in Kansas and Oklahoma to Onex Corp. (CA:OCSV) , according to a Wednesday filing with the Securities and Exchange Commission. The aerospace company will recognize $100 million of the loss in the second quarter, with the remaining loss relating to estimated pension and post-retirement curtailments and settlement expected to be recognized in the third quarter.

[UpInArms]

51. 3:37 EST going into the close

Dow 10,592.38 -7.29 (-0.07%)
Nasdaq 2,091.36 +0.29 (+0.01%)
S&P 500 1,214.31 +0.70 (+0.06%)
10-Yr Bond 3.945 -1.04 (-2.57%)

NYSE Volume 1,547,171,000
Nasdaq Volume 1,484,227,000

3:30PM: No real change in sentiment heading into the close, as split industry leadership continues to dictate late-day action... One area that has been under pressure all day has been the Materials sector, as the U.S. dollar has shown resilience in the face of falling domestic interest rates... The greenback has gained against major currencies after minutes from the Bank of England's meeting showed that two out of the nine central bankers voted for a rate reduction... NYSE Adv/Dec 1773/1465, Nasdaq Adv/Dec 1493/1511

3:00PM: Stocks still mired in relatively tight trading ranges, showing little reaction to the fact that benchmark yields have just closed at session lows... Even without any economic data today, global bond demand has lifted the 10-year note 26 ticks to yield 3.93% - its best levels in about two weeks... Thursday, however, brings an unusual appearance by Fed Chairman Alan Greenspan who, along with Treasury Secretary John Snow, will testify on China to Senate Finance panel (10:00 ET)...

Prior to their testimony, investors will digest initial claims (consensus 330K) - at 8:30 ET - followed by the 10:00 ET release of May existing home sales (consensus 7.15 mln)... NYSE Adv/Dec 1680/1533, Nasdaq Adv/Dec 1448/1530

2:30PM: Range-bound trading persists, as the major indices still trade near the unchanged mark... Meanwhile, Ameritrade (AMTD 17.11 +2.29) has just resumed trading after recently confirming its plans to acquire TD Bank's (TD 44.20 +0.59) TD Waterhouse online brokerage for $2.9 bln... Also climbing to session highs following the announcement has been E*TRADE (ET 13.85 +0.94), now that a bidding war for AMTD will not take place and may in fact put ET itself into play...

[ozymandius]

52. market sentiment today: crappy

3:41
Dow 10,586.25 -13.42 (-0.13%)
Nasdaq 2,090.75 -0.32 (-0.02%)
S&P 500 1,213.69 +0.08 (+0.01%)
10-Yr Bond 3.945 -1.04 (-2.57%)
NYSE Volume 1,562,756,000
Nasdaq Volume 1,499,827,000

3:30PM: No real change in sentiment heading into the close, as split industry leadership continues to dictate late-day action... One area that has been under pressure all day has been the Materials sector, as the U.S. dollar has shown resilience in the face of falling domestic interest rates... The greenback has gained against major currencies after minutes from the Bank of England's meeting showed that two out of the nine central bankers voted for a rate reduction... NYSE Adv/Dec 1773/1465, Nasdaq Adv/Dec 1493/1511

[UpInArms]

53. closing hoo-haaa

Dow 10,587.93 -11.74 (-0.11%)
Nasdaq 2,092.03 +0.96 (+0.05%)
S&P 500 1,213.88 +0.27 (+0.02%)
10-Yr Bond 3.945 -1.04 (-2.57%)

NYSE Volume 1,793,158,000
Nasdaq Volume 1,697,657,000

Close: Benchmark yields plummeted and oil prices fell 1.6%, but neither was enough to incite much interest for stocks, as the major averages again closed mixed in lackluster fashion... The day began on a promising note, as investors embraced the positive value implications of low bond yields, which plunged even in the absence of scheduled market-moving economic reports... Concerns about slowing global growth, spurred by record high energy costs as well as the dissenting tone from two policy makers voting for a rate reduction, underpinned the attractiveness of higher-yielding investments far and wide...

The benchmark 10-year note surged 26 ticks to yield 3.94% while even the German bund surged, knocking yields to near record lows of 3.114%... Notwithstanding lower interest rates, which raise the current value of future earnings and thus increase the current value of stocks, the indices failed to retrace early highs as five economic sectors closed higher and the other five closed lower...

Implications that a market top may be in the offing, as the S&P trades at 17 times estimated operating earnings and several stocks trade near the upper end of their ranges, also kept buying interest in check following last week's strong performance that lifted the averages to three-month highs... Pacing the way higher was the Utilities sector, as the Dow Utilities Index closed at its best levels in four years... While falling bond yields, which make dividend-paying stocks more attractive to investors seeking income, provided a floor of support for stocks, positive comments from billionaire investor Warren Buffett, who plans to invest heavily in power plants, also fueled buying interest...