STOCK MARKET WATCH, Monday 1 May

[ozymandius]

Monday May 1, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 994 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 1957 DAYS
WHERE'S OSAMA BIN-LADEN? 1657 DAYS
DAYS SINCE ENRON COLLAPSE = 1618
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 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 April 28, 2006

Dow... 11,367.14 -15.37 (-0.14%)
Nasdaq... 2,322.57 -22.38 (-0.95%)
S&P 500... 1,310.61 +0.89 (+0.07%)
Gold future... 654.50 +18.20 (+2.78%)
30-Year Bond 5.17% -0.01 (-0.25%)
10-Yr Bond... 5.07% -0.02 (-0.30%)






GOLD, EURO, YEN, Dollars, 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 Tim W. Wood

THE DOW REPORT
The Market Holds, But On Continuously Fading Internals

Yes, according to Dow theory, the Secondary trend remains positive. My intermediate-term Cycle Turn Indicator had turned down at the March high, but then turned back up in association with the April low. So, as of this writing, things are once again positive for the market from a price perspective. However, the internals continue to lag with the latest cycle advance being the weakest since the advance out of the 2002 low began. When I say weakest, I mean internally. Below I have plotted a chart of the Industrials along with an intermediate term advancing issues line in green and the corresponding declining issues line in red.

-see chart-

There are a couple of things to note here. One, each of the advancing issues lines associated with each of these intermediate term cycles has occurred at a lower level than the previous one. Two, as the market moved up into each of these intermediate term cycle tops, the advancing issues began to diverge with price. This non-confirmation occurs as a result of a thinning market, which is a naturally occurring phenomenon at cycle tops. Advancing issues, now only marginally above declining issues, as price has made a new recovery high is simply not healthy. Sure, price is positive, and I’m not here to argue the obvious. But what I am telling you is that the health of the advance is poor and bulls should continue to dance close to the door.

In addition to the fading breadth data, we continue to also have important non-confirmations that continue to linger. One such non-confirmation is between the Industrials and the Dow Jones Top Ten Index. For those not familiar with this index it represents the top ten dividend yielding stocks within the Industrials. A few weeks ago I discussed this non-confirmation and I bring it up again because it is important and still exists. The longer-term non-confirmation is noted in red and green. The shorter-term non-confirmation is marked in blue. The fact that these non-confirmations continue to exist is troubling for the market as the last such non-confirmation occurred surrounding the 2000 top.

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

[ozymandius]

2. Today's Reports

8:30 AM Personal Income Mar
Briefing Forecast 0.4%
Market Expects 0.4%
Prior 0.3%

8:30 AM Personal Spending Mar
Briefing Forecast 0.6%
Market Expects 0.4%
Prior 0.1%

10:00 AM Construction Spending Mar
Briefing Forecast 0.6%
Market Expects 0.3%
Prior 0.8%

10:00 AM ISM Index Apr
Briefing Forecast 55.0
Market Expects 55.1
Prior 55.2

[UpInArms]

22. 8:30 reports (savings rate still negative)

8:30 AM ET 5/1/06 U.S. MARCH REAL CONSUMER SPENDING UP 0.2%

8:30 AM ET 5/1/06 U.S MARCH WAGES, SALARIES UP 0.5%

8:30 AM ET 5/1/06 U.S. MARCH INCOME GAIN DUE TO MEDICARE PAYMENTS

8:30 AM ET 5/1/06 U.S. MARCH PERSONAL SAVINGS RATE NEGATIVE 0.3%

8:30 AM ET 5/1/06 U.S. MARCH CORE INFLATION UP 0.3%, UP 2.0% YEAR-OVER-YEAR

8:30 AM ET 5/1/06 U.S. MARCH CONSUMER SPENDING UP 0.6% VS. 0.4% EXPECTED

8:30 AM ET 5/1/06 U.S. MARCH PERSONAL INCOMES RISE 0.8% VS. 0.4% EXPECTED

[UpInArms]

23. Incomes, inflation accelerate in March (incomes rise because of Medicare)

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B271C58D8%2DA8C9%2D47F1%2D92E8%2D03F75E847990%7D&symbol=

WASHINGTON (MarketWatch) - U.S. personal incomes and consumer spending rose more than expected in March, while consumer prices accelerated to the top of the Federal Reserve's comfort zone, Commerce Department data released Monday showed.

Personal incomes increased 0.8% in March, the biggest gain since September, after rising 0.3% in February, the Commerce Department said. The increase in incomes was largely due to payments under the new Medicare drug program. Economists expected incomes to rise 0.4%, according to the MarketWatch survey.

Consumer prices rose 0.4% in March after rising 0.1% in February, as measured by the personal consumption expenditure index. Core prices (which exclude food and energy prices) rose 0.3%, the biggest gain since October.

Core inflation is up 2% in the past 12 months, at the top of the Fed's comfort zone. Fed officials have said they believe inflation will be contained by the lagged impacts of its 15 interest rate increases in the past 22 months, but remain vigilant in any case.

<snip>

The personal savings rate improved to negative 0.3% from negative 0.6% in February. The savings rate has not been positive since March 2005.

...more...

[UpInArms]

49. the lie in the numbers

How can personsal income rise 0.8% - spending rise 0.6% and the savings rate still be a negative 0.3%?

Looks like that "increase" was never in the consumer's pocket.

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aqwnHeUS0iYM&refer=home

excerpt:

The report's price gauge tied to spending patterns and excluding food and energy costs, the Fed's preferred measure for measuring inflation, rose 0.3 percent in March after rising 0.1 percent in February. The index was up 2.0 percent from the same month in 2005, compared with a 1.8 percent rise in February. Economists surveyed by Bloomberg forecast a 1.9 percent increase from a year earlier, the median estimate.

Disposable income, or the money left over after taxes, rose 0.8 percent, following a 0.2 percent increase the previous month. Disposable income was up 2.6 percent in the 12 months ended in March.

Taking into account changes in prices, spending rose 0.2 percent in March for a second month.

Inflation-adjusted spending on durable goods, such as autos, furniture, and other long-lasting items, rose 0.6 percent after falling 1.7 percent. Purchases of non-durable goods fell 0.4 percent after falling 0.2 percent. Spending on services, which account for almost 60 percent of total outlays, rose 0.4 percent after rising 0.7 percent.

<snip>

The savings rate, which measures the difference between income and spending, rose to a minus 0.3 percent from a minus 0.6 percent the prior month. The rate has been negative for 10 of the last 12 months. A negative rate suggests consumers are dipping into savings to maintain spending.

...more...

[UpInArms]

36. 10:00 reports:

10:01 AM ET 5/1/06 U.S. APRIL ISM MANUFACTURING INDEX ABOVE 55.3% CONSENSUS

10:01 AM ET 5/1/06 U.S. APRIL ISM MANUFACTURING INDEX 57.3% VS 55.2% IN MARCH

10:00 AM ET 5/1/06 U.S MARCH CONSTRUCTION OUTLAYS EX-RESIDENTIAL UNCHANGED

10:00 AM ET 5/1/06 U.S. MARCH PUBLIC-SECTOR CONSTRUCTION OUTLAYS UP 0.2%

10:00 AM ET 5/1/06 U.S. MARCH PRIVATE-SECTOR CONSTRUCTION OUTLAYS UP 1.1%

10:00 AM ET 5/1/06 U.S. MARCH RESIDENTIAL CONSTRUCTION OUTLAYS UP 1.6%

10:00 AM ET 5/1/06 U.S. MARCH CONSTRUCTION SPENDING RISE 0.9% VS. 0.4% EXPECTED

[UpInArms]

38. U.S. construction spending rises 0.9% in March

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BC4AC0D06%2D66F5%2D49AC%2DABC7%2D47B1A4B51DF5%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) - U.S. construction outlays increased 0.9% in March, boosted by robust home building, the Commerce Department said Monday. Outlays for residential construction increased 1.6% in March, the biggest increase since December. Excluding home building, total construction outlays were flat in March. The 0.9% gain was far higher than the 0.4% increase expected by economists surveyed by MarketWatch. Outlays in February were revised higher to a 1% gain from 0.8% earlier and January's gain was revised higher by a tenth of a percentage point to 0.5%. Spending by the private sector rose 1.1% in March. Public sector spending rose 0.2%.

[UpInArms]

48. details show that gov spending was behind the increase

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T140009Z_01_N28260177_RTRIDST_0_ECONOMY-CONSTRUCTION-URGENT.XML

But private nonresidential construction, seen as a proxy for business spending, dipped 0.1 percent in March to $267.9 billion.

Public-sector construction spending increased 0.2 percent to $258.2 billion. Government construction spending increased in many categories, including residential, commercial, health care, public safety and power.

[UpInArms]

40. ISM details: (they suck)

10:03 AM ET 5/1/06 U.S. APRIL ISM PRICES 71.5% VS 66.5% IN MARCH

10:02 AM ET 5/1/06 U.S. APRIL ISM NEW ORDERS 57.6% VS 58.4% IN MARCH

10:03 AM ET 5/1/06 U.S. APRIL ISM PRODUCTION 60.4% VS 57.5% IN MARCH

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B3C207DAE%2D78F5%2D4B63%2DAFDF%2DDD85F1D30C96%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Factory activity in the United States accelerated in April, the Institute for Supply Management reported Monday. The ISM index rose to 57.3% in April from 55.2% in March. The rise was larger than expected. The consensus forecast of estimates collected by Marketwatch was for the index to inch higher to 55.3%. Readings above 50 indicate expansion. New orders slipped to 57.6% in April from 58.4% in March, but production soared to 60.4 from 57.5. The price index jumped to 71.5% from 66.5%.

[ozymandius]

3. Oil Prices Rise Above $72 a Barrel

SINGAPORE - Crude-oil prices rose in Asian trading Monday on continued supply concerns arising from Iran's defiance of a now-expired U.N. Security Council deadline to stop enriching uranium.

Light, sweet crude for June delivery gained 48 cents to $72.36 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 91 cents to settle at $71.88 a barrel Friday.

Iran's top nuclear negotiator defiantly declared Sunday that his country was "allergic to the suspension" of uranium enrichment, while its president insisted Iran was within its rights under the Nuclear Nonproliferation Treaty to enrich uranium to fuel reactors for civilian electricity generation.

-cut-

Iran, OPEC's second-largest oil producer, has said it does not intend to halt oil exports as a political tactic, but some traders fear it's a possibility if the dispute escalates, which would most likely cause oil prices to rise.

more

[ozymandius]

4. Experts: Natural Gas Economy Losing Steam

BOSTON - On the brink of the 21st century, a group of energy experts peered into the future of natural gas, and what they saw was quite rosy — and quite wrong.

To satisfy growing demand, producers could crank out a third more natural gas over the next decade at "competitive prices." It could "power our economy" for decades beyond. Or so said the National Petroleum Council in its 1999 report.

But natural gas prices soon headed skyward, with prices charged by producers spiking late last year at nearly five times 1999 levels. This past winter, though starting off warm, saw the average gas-heating household spend a record $867, a 17 percent increase, according to federal data. As for that predicted robust supply, the country's annual gas output has strangely slipped by 3 percent over the past six years.

Something is broken in the economics of natural gas, say people inside and outside the industry. The bright dream of an economy built squarely on clean-burning natural gas is slowly deflating. Although we still derive almost a quarter of the country's energy from natural gas, its share will slip in coming decades, federal forecasters now say.

more

[amandabeech]

123. The USGS grossly overestimated the amount of natgas available

here in North America back in the '90s, at least according to many who post on energy forums. Relying on the overestimate, the prohibition on using natgas for electrical generation was lifted and zillions of gas turbine generators were built. The, OOPS, the USGS was wrong.

One reason why coal gassification looks so good to the power industry is because the products of coal gassification may be used, with some modification, in those natgas generating turbines.

Whether the USGS was pressured to adjust its figures upward has not been discussed.

[ozymandius]

5. Oil leaps above $72 on Italy refinery fire

SINGAPORE (Reuters) - Oil surged 1 percent to above $72 a barrel on Monday as a refinery fire in Italy added fresh concerns to a market already nervous over
Iran's defiant pursuit of its nuclear program and militant violence in Nigeria.

A weekend fire that shut ERG group's 160,000 barrel per day (bpd) Impianti Nord refinery in Sicily renewed concerns about gasoline supply ahead of the summer season, when European plants help meet peak season U.S. demand.

U.S. light, sweet crude jumped 79 cents or 1 percent to $72.63 a barrel by 0850 GMT, adding to a 91-cent gain on Friday that helped limit last week's losses to 4.4 percent. Trading was thin due to holidays in much of Asia and Europe.

more

[UpInArms]

14. Crude gains on Nigeria, Iran concerns

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B36B5F760%2DDD33%2D457A%2DBD03%2D5E8DA7328ACE%7D&symbol=

NEW YORK (MarketWatch) -- Crude futures rose early Monday, joining a broader commodity rally sparked by concerns about renewed violence in Nigeria and Iran's nuclear standoff with the west.

Crude for June delivery was last up 62 cents at $72.50 a barrel. The contract broke a four-session losing streak to close higher Friday after the U.N. Security Council emphasized Iran's lack of cooperation in regard to its nuclear activities, raising the specter of sanctions against the world's fourth-largest producer.

Over the weekend, Iranian President Mahmoud Ahmadinejad reiterated his determination to push ahead with uranium enrichment, defying the U.N.'s demands. The Security Council is expected this week to draft a formal resolution, legally compelling Iran to cease activities.

Nigeria returned to the news over the weekend, with reports of a car bomb attack close to an oil refinery in the oil-rich Delta region.

<snip>

Meanwhile, Italian oil company ERG SpA was forced to shut a refinery in Sicily after a fire. The facility produces 160,000 barrels of oil per day, according to research firm Action Economics.

...more...

[Ghost Dog]

62. China and Nigeria agree oil deal

http://newsvote.bbc.co.uk/2/hi/business/4946708.stm

China has secured four oil drilling licences from Nigeria as President Hu Jintao continues his week-long tour of Africa, his second in three years.

In exchange China will invest $4bn (£2.25bn) in oil and infrastructure projects in Nigeria.

China will buy a controlling stake in Nigeria's 110,000 barrel-a-day Kaduna oil refinery and build a railroad system and power stations.

<snip>

The African nation will offer first right of refusal to China National Petroleum for a quartet of exploration blocks during a licensing round due to be held in Nigeria on 19 May.

The blocks comprise two areas in the oil-producing Niger Delta - one onshore and one in shallow water - and two areas in the higher-risk inland Chad basin, where no oil is produced at present.

Last week Chinese state oil firm CNOOC said it had completed a £2.3bn deal to buy a stake in a Nigerian oil field.

<snip>

The visit indicates the importance China is attaching to securing energy and trade deals in the region.

Nigeria has the oil and gas that China wants, but also provides a potential market for Chinese goods.

Several Chinese companies have already constructed factories in Nigeria and more are planned for a free trade zone in the south-east of the country.

/more...

[UpInArms]

30. Saudi King Slashes Domestic Gas Prices (to about 60 cents per gallon)

http://www.abcnews.go.com/GMA/wireStory?id=1908064

RIYADH, Saudi Arabia Apr 30, 2006 (AP)— With gasoline prices at historic highs in the United States and some other Western countries, Saudi King Abdullah issued a decree Sunday lowering domestic gasoline prices by about 25 percent.

The decrease will reach 30 percent by year's end, according to a government statement.

The drop in prices means Saudis now will pay 60 halalahs per liter of regular gasoline. There are 100 halalahs in the Saudi riyal, which is worth about 26 U.S. cents.

The statement said the king issued the decree to ease the "cost of living burden on Saudi citizens."

<snip>

The price of a gallon of regular gasoline in the United States now tops $3 in some regions.

...more...

Saudi cuts domestic fuel prices

Saudi Arabia has slashed the domestic retail prices of gasoline and diesel between 25 per cent and 33 per cent as crude prices continued to hover around all-time peaks.

The Saudi Press Agency (SPA) published a decree by King Abdullah, who ordered a cut in gasoline prices to 60 halalas (16 cents) per litre from 90 halalas and diesel to 25 halalas per litre from 37 halalas.

The decree said the move was intended to 'improve the living standard of citizens”.

Retail prices of fuel in the kingdom are fixed and set by the state.

[AnneD]

87. One of the funny things I remember about Dubai...

was that gas prices were not posted...ANYWHERE. Maybe the state set the price?

[UpInArms]

45. June Crude @ $72.30 bbl - June NatGas @ $6.68 mln btus

10:16 AM ET 5/1/06 JUNE CRUDE RISES 42C TO $72.30/BRL AFTER $72.55 HIGH

10:16 AM ET 5/1/06 JUNE NATURAL GAS UP 12.5C, OR 1.9%, AT $6.68/MLN BTUS

[UpInArms]

59. June Crude @ $72.85 bbl - June Unl Gas @ $2.1275 gal

11:27 AM ET 5/1/06 JUNE CRUDE CLIMBS 97C, OR 1.4%, TO $72.85/BRL

11:27 AM ET 5/1/06 JUNE UNLEADED GAS TRADES AT $2.1275/GAL, UP 3.83C, OR 1.8%

[UpInArms]

72. In a Gift to Big Oil: Frist drops inventory-related tax measure from energ

Frist drops inventory-related tax measure from energy plan

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B17F71272%2DB94B%2D4E4B%2D9197%2D576B893283CD%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Senate Majority Leader Bill Frist, R-Tenn., on Monday dropped plans to seek the repeal of an inventory-related accounting measure popular with oil companies and other businesses. Senate Republicans had hoped that repeal of the "last-in, first out," or LIFO, method could be used to pay for a gas-tax rebate that is the centerpiece of a broader relief plan unveiled last week amid soaring gasoline prices. After consulting with Senate Finance Committee Chairman Charles Grassley, R-Iowa, Frist said he agreed to withdraw the LIFO proposal. "In the meantime, I'll continue working to find a way to bring our proposals to the Senate floor for a vote," Frist said, in a written statement.

[UpInArms]

79. June Crude @ $73.20 bbl - June Unl Gas @ $2.1515 gal

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BB91DE3AB%2DB7A9%2D4170%2DAA18%2D406DA05285AA%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- June crude climbed $1.32, or 1.8%, to $73.20 per barrel in afternoon dealings, touching a high of $73.41 on heightened concerns about Iran's nuclear activities. June unleaded gasoline was up 6.23 cents, or 3%, at $2.1515 a gallon, trading near the day's high of $2.163. "Average retail unleaded gas prices nationwide actually dropped (fractionally) in the last two days, ending a virtually uninterrupted swing of price increases that began in February," said Tom Kloza, chief oil analyst at the Oil Price Information Service. But the average retail unleaded price is $2.919 a gallon, vs. $2.2182 in 2005, he said.

[Robbien]

86. Not a good day for oil & gas group Repsol YPF

First Bolivia nationalizes Repsol's natural gas holdings in Bolivia

and then Repsol is fined by Spain's high court for price fixing gas prices at the pumps in Spain

http://www.forbes.com/markets/feeds/afx/2006/04/28/afx2705430.html

[UpInArms]

97. June Crude closes @ $73.70 bbl - June NatGas @ $6.695 mln btus

2:56 PM ET 5/1/06 JUNE CRUDE ENDS AT HIGHEST LEVEL SINCE APRIL 21

2:56 PM ET 5/1/06 JUNE CRUDE UP $1.82, OR 2.5%, TO CLOSE AT $73.70/BRL

2:49 PM ET 5/1/06 JUNE NATURAL GAS UP 14C, OR 2.1%, TO END AT $6.695/MLN BTUS

[ozymandius]

6. Famed Economist Galbraith Dies

CAMBRIDGE, Mass. -- John Kenneth Galbraith, the Harvard professor who won world-wide renown as a liberal economist, backstage politician and critical observer of U.S. society, died on Saturday night, his son said. He was 97.

Mr. Galbraith died of natural causes at 9:15 p.m. at Mount Auburn Hospital, where he was admitted nearly two weeks ago, Alan Galbraith said. "His mind was wonderful, right up until the end," he said.

During a long career, the Canadian-born economist served as adviser to Democratic presidents from Franklin D. Roosevelt to Bill Clinton, and was John F. Kennedy's ambassador to India. Mr. Galbraith, who was outspoken in his support of government action to solve social problems, became a large figure on the American scene in the decades after World War II.

-cut-

One of his most influential books, "The Affluent Society," was published in 1958. It argued that the American economy was producing individual wealth but hasn't adequately addressed public needs such as schools and highways. U.S. economists and politicians were still using the assumptions of the world of the past, where scarcity and poverty were near-universal, he said.

http://online.wsj.com/article/SB114637005975939835.html?mod=home_whats_news_us

[AnneD]

52. Morning Marketeers,

:donut:Most economist are calculating thieves and liars. Mr. Galbraith was the exception. He gave economist a good name. I know he had fallen from favor on Wall Street-but not here on Main Street. The proof of many of his theories have been born out in the thousands of lives he has affected in a positive way. The economic model that is currently in vogue is destructive to human well being and the blueprints he left will have to win out if we are to survive with any humanity and dignity.
John Kenneth Galbraith, one of the finest economic minds of the last century...working America salutes you on your journey. You will be missed. :toast:

[UpInArms]

53. Galbraith - honorable to the very end - to be published in MJ in May

The Predator State

Commentary: Enron, Tyco, WorldCom... and the U.S. government?

By James K. Galbraith

May/June 2006 Issue

WHAT IS THE REAL NATURE of American capitalism today? Is it a grand national adventure, as politicians and textbooks aver, in which markets provide the framework for benign competition, from which emerges the greatest good for the greatest number? Or is it the domain of class struggle, even a “global class war,” as the title of Jeff Faux’s new book would have it, in which the “party of Davos” outmaneuvers the remnants of the organized working class?

The doctrines of the “law and economics” movement, now ascendant in our courts, hold that if people are rational, if markets can be “contested,” if memory is good and information adequate, then firms will adhere on their own to norms of honorable conduct. Any public presence in the economy undermines this. Even insurance—whether deposit insurance or Social Security—is perverse, for it encourages irresponsible risktaking. Banks will lend to bad clients, workers will “live for today,” companies will speculate with their pension funds; the movement has even argued that seat belts foster reckless driving. Insurance, in other words, creates a “moral hazard” for which “market discipline” is the cure; all works for the best when thought and planning do not interfere. It’s a strange vision, and if we weren’t governed by people like John Roberts and Sam Alito, who pretend to believe it, it would scarcely be worth our attention.

The idea of class struggle goes back a long way; perhaps it really is “the history of all hitherto existing society,” as Marx and Engels famously declared. But if the world is ruled by a monied elite, then to what extent do middle-class working Americans compose part of the global proletariat? The honest answer can only be: not much. The political decline of the left surely flows in part from rhetoric that no longer matches experience; for the most part, American voters do not live on the Malthusian margin. Dollars command the world’s goods, rupees do not; membership in the dollar economy makes every working American, to some degree, complicit in the capitalist class.

In the mixed-economy America I grew up in, there existed a post-capitalist, post-Marxian vision of middle-class identity. It consisted of shared assets and entitlements, of which the bedrock was public education, access to college, good housing, full employment at living wages, Medicare, and Social Security. These programs, publicly provided, financed, or guaranteed, had softened the rough edges of Great Depression capitalism, rewarding the sacrifices that won the Second World War. They also showcased America, demonstrating to those behind the Iron Curtain that regulated capitalism could yield prosperity far beyond the capacities of state planning. (This, and not the arms race, ultimately brought down the Soviet empire.) These middle-class institutions survive in America today, but they are frayed and tattered from constant attack. And the division between those included and those excluded is large and obvious to all.

Today, the signature of modern American capitalism is neither benign competition, nor class struggle, nor an inclusive middle-class utopia. Instead, predation has become the dominant feature—a system wherein the rich have come to feast on decaying systems built for the middle class. The predatory class is not the whole of the wealthy; it may be opposed by many others of similar wealth. But it is the defining feature, the leading force. And its agents are in full control of the government under which we live.

...more worth the reading of every word...

I second you, AnneD, John Kenneth Galbraith was a true economist for the people.

He shall be greatly missed.

[Ghost Dog]

61. The legacy of JK Galbraith

See BBC here. Recommend follow links...

"His lasting legacy will be to appreciate the economic system as a complex interaction of people and organisations whose actions cannot simply be understood through highly rational and mathematical models of the economy."

<snip>

One of his most famous works was the 1958 best-seller "The Affluent Society".

In it he argued that America's quest for wealth creation was fine at creating giant companies and encouraging consumer demand for products they did not need, but was doing so at the expense of many people's social welfare and was creating a land of haves and have-nots.

/more...

[UpInArms]

64. just in my own mind - Galbraith's thoughts set to music

Don't you know
They're talkin' about a revolution
It sounds like whisper
Don't you know
They're talkin' about a revolution
It sounds like whisper

While they're standing in the welfare lines
Crying at the doorsteps of those armies of salvation
Wasting time in the unemployment lines
Sitting around waiting for a promotion

Poor people gonna rise up
And get their share
Poor people gonna rise up
And take what's theirs

Don't you know
You better run...
Oh I said you better
Run
run
run...

Tracy Chapman

[ozymandius]

7. 'Day Without Immigrants' expected to hit US economy

LOS ANGELES (AFP) - Latino leaders laid last-minute plans for a "Day Without Immigrants," a nationwide strike and boycott to brandish their economic power as lawmakers debate restricting immigrant labor.

Many Hispanic groups urged their members to forgo work, school and shopping on Monday to press lawmakers to allow the estimated 12 million mostly Latino undocumented workers to stay.

"We have to make our presence felt through our absence," organizers from the nation's most influential Hispanic groups said Friday at their final press conference before the mass boycott.

Monday is a normal work day in the United States, where Labor Day is celebrated in September instead of May 1. However, it might look more like a May Day abroad, complete with demonstrations called by labor unions and workers' rights advocates.

more

[AnneD]

69. The economic impact of immigrant labour..

Ok, I am prepared to be flamed, but I am on a border state so I have strong opinions on this. We are talking about ILLEGAL immigrants here. I know far too many folks that try to come here legally and are hassled beyond belief. No one should cut in front of the line. I am not anti immigrant-these folks are just trying to make a living for their families and I respect that.

What won't work

1) We do not need a fence. It has been tried before (Great wall of China, Maginot Line). They just don't work. We do need a guest worker program that can allow for work on a temporary basis.

2) Criminalizing the illegal alien. They aren't criminals, just folks trying to support their families.

The not so hidden cost of cheap labour

1) Services are strained by this 'cheap labour'. Employers do not pay enough for these folks to get insurance. I just finished entering health insurance on all the kids here in our school. Children that I would suspect of questionable immigration status did tend to have no insurance or government subsidized insurance. Employers are getting a free ride here and it is hurting our health care system.

2) The educational system is strained. It costs more to educate these children. In our district, we do not ask where you are from, but where do you live. It is the right thing to do-but it costs. We get Federal tax dollars to help-but it is not enough. So school districts (and state governments)have to raise more tax dollars to pay for this.

3)An influx of cheap immigrant labour into a profession suppresses wages. Look at what companies have to close today. Tyson is one. Some of you 'seasoned' posters may remember when a butcher made good money AND had benefit. Now it is a job for immigrants (cheap wages, poor working conditions, few benefits). Construction is going that way too. I now many American born skilled construction workers that can't even get an interview. My brother, is a skilled welder. He use to work on submarines. Those sailors that use the subs he built can rest assured those seams he did will hold. He was promoted to quality control-and he took that job to heart. He now has his own portable setup. He was hired as an independent contractor at $60 dollars/hour (reasonable as he has supplies and portable setup. He was informed by his contractor that he would not be needed. Bro asked if there was no more work (he knew better). He was informed by the boss that he (boss) was going to hire 2 illegals and pay them $10/hr. My brother was furious as he had seem some of the work (and had to rework the seams). Think about THAT the next time you walk into a new high rise.

What will work

1)A comprehensive plan. The Amnesty Bill was good but it was not executed fully. Be prepare to follow the plan.

2)Dry up the incentive. Business that hire illegal aliens should pay hefty fines and their CEO's should be fined and face jail time. That would stop the hiring of illegals immediately. Of course that would mean that they would have to hire American born workers at a livable wage:nopity:

3)A guest worker plan that would legalize immigrant status. Those not in compliance would face deportation, period. I really haven't thought about those that would eventually want citizenship, but we already have a mechanism in place for that (even though it needs to be funded and updated).

Well, these are my thoughts on the subject after dealing with it day in and day out for years now. Flame away, but I think these ideas are fair to all.

[UpInArms]

77. no flame-gun here, AnneD

for reading material for others, I will recommend Fast Food Nation -

http://www.amazon.com/gp/product/0060938455/103-6774521-7459059?v=glance&n=283155

Fast Food Nation: The Dark Side of the All-American Meal (Paperback)

excerpt:

Schlosser's investigation reaches its frightening peak in the meatpacking plants as he reveals the almost complete lack of federal oversight of a seemingly lawless industry. His searing portrayal of the industry is disturbingly similar to Upton Sinclair's The Jungle, written in 1906: nightmare working conditions, union busting, and unsanitary practices that introduce E. coli and other pathogens into restaurants, public schools, and homes. Almost as disturbing is his description of how the industry "both feeds and feeds off the young," insinuating itself into all aspects of children's lives, even the pages of their school books, while leaving them prone to obesity and disease. Fortunately, Schlosser offers some eminently practical remedies. "Eating in the United States should no longer be a form of high-risk behavior," he writes. Where to begin? Ask yourself, is the true cost of having it "your way" really worth it? --Lesley Reed --

[AnneD]

82. Fast Food Nation is a classic

along the lines of The Jungle and Silent Spring. It is a must read. You will think twice before EVER eating at a fast food establishment.

[UpInArms]

73. Meat plants close for rally

http://today.reuters.com/business/newsarticle.aspx?type=ousiv&storyID=2006-05-01T162614Z_01_N01450491_RTRIDST_0_BUSINESSPRO-USA-IMMIGRATION-LIVESTOCK-DC.XML

CHICAGO (Reuters) - Top U.S. meat companies shut operations on Monday as tens of thousands of workers rallied across the nation for immigration reform, but the closures will not raise chicken, beef or pork prices at supermarkets, analysts said.

The one-day shutdowns, announced last week, were led by Tyson Foods Inc. (TSN.N: Quote, Profile, Research), the country's top meat producer. It was joined by other processors including Seaboard Corp. (SEB.A: Quote, Profile, Research) and privately held Cargill Inc. and Swift & Co.

<snip>

The meat plant closures come at a time when supplies of pork, beef, and chicken meat are large as the spread of bird flu, a temporary chicken import ban by Russia and a fifth case of mad cow disease in Canada take a toll on sales.

"This will not affect retail prices," said Len Steiner of Manchester, New Hampshire-based Steiner Consulting Group, which tracks food sales, including meat.

...more...

[AnneD]

84. I think that sorta

proves my point about illegal immigration and wage supressions. Just like The Jungle.'Every thing but the squeal'.

[ozymandius]

8. EU extends trade sanctions on US imports

The EU decided on Monday to impose retaliatory sanctions worth $9.1 million on imports from the US which had adopted anti-dumping measures to protect its domestic companies.

The new sanctions will bring the total amount of the punitive tariff payments incurred on US imports in the last year to $36.9 million, up from $27.8 million in the previous 12-month period, said a statement issued by the European Commission.

The punitive 15 per cent additional import duty would cover eight new products, including different types of blankets, paper products, photocopying apparatus and drills, according to the EU executive body.

http://www.hindustantimes.com/news/181_1687765,00020008.htm

[amandabeech]

124. If the dollar continues to fall as it has in the past few days,

the EU will have to up those saction percentages.

[ozymandius]

9. Bridgestone cuts H1 net outlook on US plant closure

TOKYO, May 1 (Reuters) - Top Japanese tyre maker Bridgestone Corp. (5108.T: Quote, Profile, Research) lowered its half-year net profit forecast by 9 percent on Monday to account for the possible closure of a U.S. plant in Oklahoma City, while raising its operating profit projection citing a weaker-than-expected yen.

Reporting its first-quarter results, Tokyo-based Bridgestone said it would likely book a total extraordinary loss of $170 million for the potential plant closure, with $140 million of that booked in the first half of 2006.

-cut-

Bridgestone's North American unit, Bridgestone Firestone North American Tire LLD, said at the weekend that it had notified the United Steelworkers that it may close the money-losing Oklahoma City tyre plant by the end of this year, trimming more than 1,400 jobs.

No final decision has been made, but the unit said the U.S. tyre industry faced intense competition from producers in lower-cost countries, and that it would be difficult -- if not impossible -- to make the plant competitive.

more

[ozymandius]

10. Bush rejects most congressional remedies to high gas prices (idiot redux)

WASHINGTON (MarketWatch) -- President Bush dismissed most congressional remedies to high gas prices, saying that regulatory relief and new infrastructure investment by oil companies are the right ways to bring prices down.

"My attitude is that oil companies need to be mindful that the American people expect them to reinvest their cash flows in such a way that it enhances our energy security," Bush said during a wide ranging press conference in the Rose Garden on Friday.

"That means pipeline construction for natural gas deliveries. That means expansion of refineries. That means exploration in environmentally friendly ways," Bush said.

Bush gave no support to some proposals floating in Congress to address high gas prices, such as a $100 rebate for consumers or a windfall profits tax.

Asked if he supported a tax on oil company profits, Bush replied: "the temptation in Washington is to tax everything and then they spend the money."

more

[Mojorabbit]

50. This would assume that oil companies

are not global corporations. They no longer are purely american companies. Why should they invest in our country when there are willing cutomers elsewhere or have I got it wrong?

[UpInArms]

75. High Gas Prices Enrage Consumers, Terrify Politicians

http://www.consumeraffairs.com/news04/2006/04/panic_pump.html

U.S. consumers are fed up with rising gasoline prices and looking for someone to blame. Words like price gouging are filling the air and politicians -- Democrats and Republicans alike -- are on the verge of panic out of fear that voters will blame them.

The harsh truth is that springtime gasoline this year costs 70 cents a gallon more than it did last April. Oil traders insist the increase has more to do with market speculation than a fundamental shift in supply and demand.

<snip>

Exxon Mobil's profits are up 14%, Chevron's jumped 49 percent and Valero Energy Corporation reported a gigantic increase of 60 percent. "We had the highest first quarter earnings in the company's history, and the outlook for the rest of the year is even better," gushed Bill Klesse, Valero's Chief Executive Officer.

<snip>

Since 1990, oil and gas interests have contributed $140.9 million to GOP federal candidates and $46.7 million to Democrats, according to the Center for Responsive Politics in Washington. In the last election cycle, 84 percent of oil interest political contributions flowed to Republicans and 16 percent to Democrats, according to the public-interest group.

In return, Congress and the administration have paid little more than lip service to energy conservation steps. And as for closing many of the tax loopholes the energy industry enjoys? That hasn't even gotten lip service, it's been completely ignored.

...more...

Big Oil has funded the Culture of Corruption that abounds within the GOPpiggie fratboy party.

[UpInArms]

76. Commentary: 'Oil price gouging and Republican responsibility'

http://www.smirkingchimp.com/print.php?sid=25904

Most American consumers understand that the energy policies of the Republican Party simply stink of oil money. The ties between the Bush White House and oil interests are well understood. The policies pursued by the Bush Republicans in terms of energy, environmental regulations, monopolies, taxation and foreign policy are those of the largest oil companies instead of the American consumer.

Recently on MSNBC, Congresswoman Marsha Blackburn attempted to blame high oil prices on liberals and environmentalists. The attempt was pathetic and a classical Blackburn tactic. Blackburn often goes into a standard speech mode attacking liberals, environmentalists and/or Democrats or repeating some standard Republican talking points when she has no logical response to politically uncomfortable facts.

While visiting her office with a delegation of Tennessee auto workers, I saw her filibuster the members of the delegation. She quickly excused herself for a pressing meeting with a business lobby as soon as the auto workers started discussing policy issues of importance to working Americans. She refused to let these auto workers even state their concerns. Blackburn votes with the largest corporations on every importance piece of legislation and routinely against her largely middle class Congressional District.

Blackburn is a typical example of a Republican member of Congress. Her campaign coffers are stuffed with Corporate money. She always votes in the interest of the wealthiest of the wealthy. Her political story shows how Big Oil has been able to rape the American consumer with the active assistance of a Republican dominated federal government.

<snip>

Some internal oil company documents and emails made public seem to indicate that supplies were deliberately tightened by oil industry actions in order to drive up prices and oil industry profits. The oil industry made scapegoats out of environmentalists, and Republican political allies picked-up this theme, in order to cover their apparent manipulation of markets. This market manipulation should have been illegal. Congress needs to investigate the oil industry at the highest levels. This investigation should be focused largely on refinery operations and the anti-competitive situation created by oil company consolidations.

...more...

[UpInArms]

11. daily dollar watch

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

Last trade 85.92 Change -0.05 (-0.06%)

Bernarke Buries The Dollar

http://www.dailyfx.com/story/special_report/special_reports/Bernarke_Buries_The_Dollar_1146462720803.html

“Bernarke buried the dollar yesterday with his dovish testimony in front of Congress, “ we wrote on Friday. As many other analysts have already pointed out, Chairman Bernarke’s premeditated use of the word “pause” was enough to send dollar bears into a frenzy. With the market already nervous about dollar’s stability given the massive structural deficits of the United States, any suggestion that the rate hike cycle is coming to an end was enough to push the EUR/USD through the critical 1.2500 level. By the end of the day that number had reached the 1.2600 figure as lower than expected GDP, disappointing U of M numbers and a softer Chicago PMI all combined to drive the dollar lower.

Yet with almost everyone in the FX market turning into a dollar bear, the trade may be becoming a tad too crowded. Last Friday night came out an announcement out of Citibank was that they took profits on their dollar short positions as they felt “compelled to lock in the impulsive profitability of this move and look again next week".

What could cause a retrace in this monster up move? Stronger Personal Income data, a hefty NFP above 200K and oil below $70 could bring dollar bulls right back to the party. Next week could see some very active order flow.

...more...

US Dollar Annihilated

http://www.dailyfx.com/story/dailyfx_reports/daily_technicals/US_Dollar_Annihilated_1146481588272.html

EUR/USD – The long term inverse head and shoulders reversal pattern has played out to perfection as the pair trades just shy of its 50% fibo of 1.3666-1.1640 at 1.2650. The past two weeks have seen gains of 235 and 268 pips. This is just the second time since the advent of the euro (January 1999) that the pair has gained more than 200 pips for two consecutive weeks. The other occurrence was during the weeks ending 6/21/2002 and 6/28/2002 when the pair gained 281 and 221 pips and the next week was a contra move to the tune of 181 pips. If history repeats, then expect a contra move this week. Taking a look at the bigger picture, it is interesting to note that the June 2002 occurrence was set in the middle of an uptrend from .9000 to 1.0200. Price ended the 6/28 week at .9918 and, as mentioned, retraced the next week before continuing to 1.0200. This suggests that we see a retrace of the recent move before a continuation of the uptrend towards the 61.8% fibo of 1.3666-1.1640 at 1.2889.

<snip>

USD/JPY - USD/JPY broke below the 113.41 low made on 1/12 and challenged the 113.00 figure. As mentioned last week, the pair has crossed below and closed below the 40 week SMA. The last cross of the 40 week SMA was during the week ended 5/13/04 when the pair crossed above the SMA at 106.16. After the break of the 1/12 low, scope remains for a test of the July 2004 high at 112.50. Positive divergence on the dealer charts along with the pair hugging the lower Bollinger band on the daily leaves possibility for a contra move. Resistance comes in at the 23.6% of 118.86-113.02 at 114.40 with a break above targeting the 38.2% at 115.24.

<snip>

USD/CAD – The Canadian Dollar is on a tear against the US Dollar as the pair continues to make fresh 28 year lows. In fact, the pair broke the November 1991 low of 1.1189 on Friday and continues to trade below. Since USD/CAD has not traded to such prices in nearly three decades, there is little to reference at the moment regarding support and resistance. However, we can use still use Fibonacci theory to forecast support. As such, the 138.2% and 161.8% fibos of the 1.1297-1.1771 March bull wave come in at 1.1116 and 1.1005 and are potential supports. A bounce higher off of the lower Bollinger band on the daily targets the 4/26 low at 1.1251 and the confluence of the 23.6% fibo of 1.1771-1.1154 / 10 day SMA at 1.1298/1.1305.

...more...

[RawMaterials]

20. The Dollar Is Set For A Large Decline. Here's Why...

In our "2006 Investment Roadmap" (see below) we tried to repeatedly emphasize the importance of the Euro 1.235 level that gave way since last week's column. The GBP, Swiss Franc, and CAD have also broken out versus the dollar and the dollar has broken down at below the 88 level of a weekly head and shoulders top pattern that looks setup to ultimately reverse the entire dollar bull market of 2005. As indicated in our Roadmap, this is a landmark event that changes the environment of the financial markets significantly. Investors who can hedge against dollar declines should do so. Even those who don't have hedging accounts should consider margined hedges in FXE, the ETF for the Euro.

Just a few trading days after the critical breakout in the Euro and breakdown in the dollar, Bernanke looks to be giving his nod to a dollar decline by suggesting in the strongest language yet, that the Fed is likely to be close to the end of its tightening cycle. Investors should look for more wild moves in commodities, a new bear leg in dollar, more market volatility, and fasten your seatbelts.

Last week the metals blew-off but the lows held in all but silver and with the dollar breakdown, their strength is impressive. New highs by base metals in particular will show remarkable resilience. The markets feel more and more like the wild seventies than I could have imagined.

While this is a wild ride party for those on board the right trends, investors need to keep their feet on the ground. No one should NOT be troubled by the persistent decline in bonds – it is musical chairs time in the markets and investors should keep margin levels low and expect for some chairs to eventually go missing so that risk should be lower than normal here.

I continue to suspect strongly that the period directly ahead is one where it may be ABSOLUTELY CRITICAL for investors to have a solid grasp and understanding of the Big Picture Macro background of global markets, the top secular themes, and the huge vulnerabilities of this environment. A potential MAJOR SHOCK to the markets is brewing and those unaware could easily be sideswiped. That is why I wrote the “2006 Investment Roadmap” which is my best effort at thoroughly explaining the global macro picture and its precarious state as well as what to watch closely to monitor how massive risks are developing.

Our US selection methods, our Top RS/EPS New Highs list published on TradingMarkets.com, had readings of 137, 123, 66, 68 and 80 with 18 breakouts of 4+ week ranges, no valid trades meeting criteria, and no close call. This week, our bottom RS/EPS New Lows recorded readings of 11, 7, 11, 14 and 9 with 6 breakdowns of 4+ week ranges, no valid trades and no close calls. The “model” portfolio of trades meeting criteria is now long (NYSE:USG - News) (use this weeks low to 50 day ma as ops area if not stopped out already), (NYSE:GG - News) (use support around 30 level as trailing stop and re-enter if partial profits taken), (NYSE:TS - News) (this week's lows look important to hold), (NYSE:MTU - News), and (NasdaqNM:WIRE - News) (here too this week's lows look critical)– with new highs this week in WIRE, GG and TS. Continue to tighten up trailing stops whenever possible on stocks with open profits and strive to move stops to break-even or better as quickly as possible in new entrants.

In our “2006 Investment Roadmap” we tried to identify how major markets could change and what the impact of those changes could be along with noting what levels to watch in which markets to see those changes developing.

We have now had TWO major changes -- one in bonds, and one in the dollar that has developed since then. The impact of these changes is too long a subject to cover fully here, but we believe it is critical to investors to understand and monitor more closely than ever. A perfect storm may be brewing for certain asset classes.

Mark Boucher has been ranked #1 by Nelson's World's Best Money Managers for his 5-year compounded annual rate of return of 26.6%.

For those not familiar with our long/short strategies, we suggest you review my book The Hedge Fund Edge, my course "The Science of Trading," my video seminar, where I discuss many new techniques, and my latest educational product, the interactive training module. Basically, we have rigorous criteria for potential long stocks that we call "up-fuel," as well as rigorous criteria for potential short stocks that we call "down-fuel."




http://biz.yahoo.com/tm/060428/14252.html?.v=2

[UpInArms]

24. Dollar at 1-year low vs. euro, 7-month low vs. yen

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BB8A89D73%2DC311%2D4C6F%2DA9A9%2D86FEECC3E8F9%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- The dollar tumbled to a one-year low against the euro and seven-month low against the yen early Monday, showing a limited reaction to a stronger-than-expected personal incomes and consumer spending report. U.S. personal incomes increased 0.8% in March, the biggest gain since September, the Commerce Department said. Consumer prices rose 0.4%. Core prices (which exclude food and energy prices) rose 0.3%, the biggest gain since October. Core inflation is up 2% in the past 12 months, at the top of the Fed's comfort zone. Consumer spending increased 0.6% in nominal terms. Economists expected incomes and spending to rise 0.4%. The euro strengthened to $1.2645 before slipping back to $1.2635, up 0.1%, the dollar was down 0.6% at 113.07 yen, after touching 113 yen.

[Lydia Leftcoast]

71. Yes, the yen is gaining strength against the dollar

As I mentioned before, I watch this avidly, since it has a direct bearing on my income.

ON EDIT: It's dropping against the British pound, too. :-(

Maybe I should save my yen to convert directly to pounds when I go to England....

[Ghost Dog]

80. Tokyo stocks rebound in thin trading, currency worries limit gains

(Kyodo) Tokyo stocks rebounded in thin trading Monday on gains in drug and other recent major decliners but the rise was limited due to worries over the U.S. dollar's rapid fall to the 113 yen level.

The 225-issue Nikkei Stock Average gained 19.48 points, or 0.12 percent, to 16,925.71, after losing some 200 points on Friday. The Tokyo Stock Price Index of all First Section issues on the Tokyo Stock Exchange rose 0.74 point, or 0.04 percent, to 1,717.17.

Trading was quiet as many investors refrained from making major moves before the Tokyo stock market is closed for national holidays from Wednesday to Friday, brokers said.

<snip>

Export-oriented high-tech issues were sluggish reflecting U.S. counterparts' weakness, as seen in a nearly 1 percent drop in the tech-laden Nasdaq Composite Index on Friday, and the U.S. dollar's fall against the yen, brokers said.

/more...

[Ghost Dog]

81. Key 10-year Japanese gov't bond yield ends at 3-week low

(Kyodo) _ The yield on the benchmark 10-year Japanese government bond fell to a three-week low Monday as buybacks set in after Bank of Japan Governor Toshihiko Fukui's comments on Friday did not boost market expectation of an early interest rate hike.

In interdealer trading, the yield on the No. 278 1.8 percent issue lost 0.045 percentage point from Friday's close to end the day at 1.875 percent, matching the closing quote on April 10.

The price of the key June futures contract for 10-year bonds surged 0.54 point to 133.14 on the Tokyo Stock Exchange, with the yield down 0.049 percentage point to 2.017 percent.

/not much more

[AnneD]

85. I wouldn' t think twice....

yen to pounds. Might even set up a company account in Japan-have them deposit the yen to your account and do a little Forex trading. Issue yourself a check from your company account. That's what I would be inclined to do and might be worth checking into.

[Lydia Leftcoast]

91. Unfortunately, without a residence permit, you can't open a bank account

in Japan.

I've tried. :-(

It would make my life simpler, because my Japanese clients would prefer to pay me the way they pay all their Japan-based contractors, which is, believe it or not, to use their own bank's ATMs to transfer money into the accounts (whether at their own or other banks) of the contractors.

Actually, I'm due to get a big cash reimbursement when I'm in Japan. I may just hang on to that and trade it in for pounds when I'm in England.

[AnneD]

94. Wow,

learn something new every day. Can you go over there and pick up the money and convert it to pounds in Japan? Surely there is a way to peel this bananna.

[Lydia Leftcoast]

118. Hmm, I believe I could, at least at the airport

It would depend on which way the pound and yen were moving relative to the dollar and to each other. :shrug:

[AnneD]

120. Now your thinking...

you can cash out what you need and speculate on the rest in different currencies. When hubby and I travel, we always wind up with all this different currencies. We watch for the price to be right, then trade it.

[UpInArms]

27. dollar doing that plummet thing

Last trade 85.53 Change -0.44 (-0.51%)

Settle Time 15:02 Open 85.98

Previous Close 85.97 High 86.01

Low 85.53 2006-05-01 09:08:55, 30 min delay

[Spazito]

67. While checking out the Kitco site, I spotted this interesting article

How US investors can best profit from the trashing of their currency...

snip

Many citizens of the United States see their country as the center of the universe, which is understandable as it is continental in size and has a massively powerful military and - until now - has possessed the “de facto” world currency. However this view can create a dangerous myopia, particularly for U.S. investors who tend not to invest outside their own country. The United States has exploited the advantage and leverage potential resulting from possession of the world currency to the absolute limit, and created debts and obligations that are of truly astronomic proportions and are physically impossible to correct. The inevitable consequence of all this is that the dollar is now buckling and is set to plumb much lower levels, which will pose a grave risk for the world financial system.



Many United States investors need to wake up fast and start “thinking outside the box” if they are to preserve their capital. Here is a fact of life - if your assets are denominated in US dollars and the dollar falls in value on world markets by say 50% over the next year or two, as is possible, you will have lost half your capital. It may not seem like it at first as you go about your local shopping, but just watch the inflation that comes down the pipe and you’ll discover the new reality soon enough. Better still, try going on a foreign holiday and see how far you get.

So what’s a poor US investor to do? The solution is actually simple and involves two key planks. The first thing you have to do is get your money out of US denominated assets, and the second thing is to invest in hard assets - Base Metals, Precious Metals, Oil and Commodities generally, via stocks or other instruments that are not priced in US dollars. In other words, put your money into hard assets priced in more resilient currencies.

more

http://www.kitco.com/ind/maund/may012006.html

I plead a total lack of knowledge about the author but his commentary certainly makes sense to me from where I sit, ie, the soaring loonie against the US dollar.

Just a quick note of THANKS to those who keep this thread going, it is much appreciated!!

[Spazito]

93. Loonie cruises near 90 cents US

The Canadian dollar continued its upward trajectory on Monday as market watchers suggested it is headed back to parity with the U.S dollar.

In afternoon trading, the loonie was going for 89.98 cents US, up 0.53 cents from Friday's close.

The Canadian dollar has been on a tear recently, rising from 86.01 cents US at the end of March to 89.26 cents US at the end of April.

With the loonie approaching 90 cents US, some economists are now suggesting that a return to parity with the U.S. dollar is only a matter of time.

more

http://www.cbc.ca/story/business/national/2006/05/01/loonie-060501.html

[UpInArms]

12. Gold surges anew as dollar loses its luster

http://www.marketwatch.com/News/Story/4CG8Jz00GHhrFZQW2LKVbwT?siteid=mktw&dist=morenews

HONG KONG (MarketWatch) -- Gold futures pushed to their highest levels since 1980 on Monday, with capital flowing to the precious metal as a weak U.S. dollar sent investors in search of a safe haven.

The June contract climbed to $660.90 an ounce during Asian trading, up $6.40 from its Friday finish in New York. In April, gold prices swelled by almost 12%. See Metals Stocks.

<snip>

"Global debt is out of control in many countries. On the other hand, you have the possibility of war in Iran. The U.S. Geological Survey says there are only 50 more years of proven reserves left underground, and above ground stockpiles are also almost exhausted."

<snip>

Goldman Sachs, J.P. Morgan and UBS have all raised their gold price forecasts in recent months. In an April report, Goldman cited the rising U.S. current account deficit, inflationary pressures and a weakening dollar among the factors making gold a desirable buy.

...more at link...

[UpInArms]

16. Gold's hour may last a while

http://www.marketwatch.com/News/Story/xq6Ww219HlClmsvv0qLmbp?siteid=mktw&dist=TNMostMailed

NEW YORK (MarketWatch) -- Gold's hour has come -- but has it gone?
Gold closed at 651.50 on Friday, with a spectacularly strong last half hour that has close observers -- for example, Bill Murphy's lemetropolecafe.com -- speculating excitedly that a major short is under pressure.

This is not just a bull market -- it's beginning to look like a blow-off. Is it too late to join the party?

First a MarketWatch proprietary word: our Hulbert Gold Newsletter Sentiment Index (HGNSI), which reflects the average gold market exposure among a subset of short-term gold timing newsletters tracked by the Hulbert Financial Digest, stood at 58.9% on Friday night.

That's still not quite two-thirds of its all-time high of 89.6% -- and actually sharply lower than the 73.2 percent recorded on April 19-20, when gold first stabbed above $600.

<snip>

"Still no gold or silver stocks on the top 25 most active stock list. From what I see, the U.S. public isn't in gold at all. Most have never even seen a gold coin...Gold now rising against virtually ALL foreign paper junk currencies. Sooner or later we'll see a world rush to buy gold."

...more...

[UpInArms]

17. and

"The great handicap that most investors bring to what is happening in the precious metals markets now is that they have little or no knowledge of the NATURE of money or of the fragility of the paper investments which they have been playing with for their entire adult lives. A soaring Gold price makes them irritable and confused. That's supposed to be an 'inflationary indicator,' but Washington and Wall Street are telling them that inflation is 'minimal.' Gold and Silver are to them, exotic and inherently risky investments. After all, weren't they in a bear market for decades when everybody was getting rich on paper?"

[Roland99]

19. Wage inflation is minimal, I'll give them that.

As for real inflation, well, we all know what's behind the spin.

[54anickel]

99. Wage inflation is still being exported, it started with Japan (and look

what it did to them in the end - the reason China has said NO WAY to any Plaza redux). Exporting wage inflation is part of the "strong dollar policy", though Rubin would never admit that. One of those things I'll always hold against Clinton - whether he realized it or not, by keeping on Greenspin, passing NAFTA and bringing in Rubin from Wall Street, he was a used as a tool of the "banking plutocracy" to continue their unsound monetary practices started under St. Ronnie.

The US dollar is based on nothing more than a confidence, and I see that confidence waning fast - something's up when the IMF goes into pre-emtive mode. They've been able to to keep the game going this long, but I have a hunch they are loosing control fast.

Interesting article from August of 2003.

http://www.atimes.com/atimes/Global_Economy/EH14Dj02.html

snip>

When O'Neill, Snow's predecessor, argued that markets rather than governments should determine exchange rates, he was asserting that US government policies would aim at preserving long-term market support for the dollar. He claimed he had been misunderstood that he meant a strong-dollar policy was no longer in place. The misunderstanding actually came not from the market being simplistic, but from the mismatch of the neo-liberal myth of a free market in foreign exchange, as espoused by central banks, and the market's view of the fact that the foreign-exchange market is anything but free.

During the Clinton administration, Robert Rubin, widely regarded as the father of the strong-dollar policy, declared his aim of a strong dollar soon after his appointment to the Treasury in January 1995. Rubin understood that a capital account surplus is the answer for a current account deficit, based on economics worked out by Martin Fieldstein in the Ronald Reagan administration. A strong dollar is key to this capital account surplus/current account deficit strategy, which has come to be known as dollar hegemony.

The policy exploits the instinctive penchant of other countries to make export gains from an undervalued currency. The United States would open its huge market to the exporting economies of the world and force them to finance the resultant US trade deficit with capital inflows from the exporting economies. A strong dollar ensures the appeal of US companies to overseas investors and thus aligning global support for a strong dollar. Dollar hegemony forces the central banks of US trading partners to hold their dollar trade surplus in US bonds and assets, if they want protection from speculative attacks on their currencies. A fall in domestic currency will cause domestic interest rates to rise, and make dollar loans more expensive to service and amortize.

As US domestic demand skyrocketed in the late 1990s, the 30 percent rise in the trade-weighted dollar between 1996 and 2001 helped keep a lid on domestic inflation and kept dollar interest rates low, even as the Fed began to hike the Fed Funds rate target to preempt wage-pushed inflation caused by structural full employment (at 4 percent unemployment). While US companies managed to attract overseas investors with low yields that translated into high yields in their own home currencies by a strong dollar, the inflow also financed the merger/acquisition mania of US companies that made the resultant entities fiercely competitive global giants.

The budget surplus of the Clinton years did not slow down inflow of funds, which readily went to finance mergers and acquisition and initial public offerings (IPOs). The easy money and credit milked from the backs of underpaid workers in the exporting economies enabled the US economy to venture into new technological fields, such as digitized telecommunication that spurred the dot-com fever, structured finance that gave birth to the hedge funds industry, and all manners of financial and accounting acrobatics. Wealth was being created as fast as the United States could print money, with little penalty of inflation. The rest of the world was shipping products they themselves could not afford to consume to US consumers in exchange for papers of the US financial system that in turn feeds US consumer power with debt.

A new economic sector called financial services came into existence. This was the true meaning of the slogan "a strong dollar is in the national interest". Dollar hegemony allowed the United States to levy a tax on the rest of the world for using the dollar, a fiat currency, as the reserve currency for world trade. The livelihood of the world's workers came to depend on US consumers' appetite for debt sustained by loans from the underpaid workers' own governments. Neo-imperialism works by making the world's poor finance the high living of the world's rich. It transcends the Marxist notion of class struggle and surplus value. In neo-liberal globalization, not just labor but even capital comes from the exploited.

more...

[Ghost Dog]

117. Expect new Japan wage inflation?

Japan sees first rise in workforce in 8 years
http://news.ft.com/cms/s/0cce1e80-d90d-11da-8b06-0000779e2340.html
By David Pilling in Tokyo
Published: May 1 2006 13:34 | Last updated: May 1 2006 18:13

The Japanese labour force has risen for the first time in eight years as women and those over 60 are drawn back to the jobs market in a sign of the strength of Japan’s cyclical recovery, now in its fifth year.

The willingness of those who left the jobs market to re-enter also shows the mechanisms by which the labour market might respond to the challenges of an ageing society, which is shrinking the size of the traditional workforce.

An analysis in Monday’s Nikkei newspaper found that Japan’s labour force, comprising those in jobs as well as those seeking work, rose by 150,000 to 66.54m in the year to April.

Separate data released on Monday by the labour ministry showed the total number or regular employees rose 0.6 per cent in March from a year earlier, with full-timers up 0.6 per cent, outpacing the rise in part-timers, up 0.3 per cent.

Part of the explanation is that people discouraged from looking for work have come back to the labour market amid brighter job prospects, say labour economists.

Recent surveys show that after years of excess labour capacity there are now more jobs available than job-seekers to fill them. Earlier this year, the ratio rose to 104 jobs per 100 applicants, though it has since slipped back marginally.

According to official figures, the number of women in the labour force has risen 220,000 in the past three years to 27.52m. By last year, there were also 9.67m people aged 60 or over either working or looking for work, a 450,000 increase from five years earlier.

Until 2000, the official retirement age was 60, but this is now being raised incrementally to 65 by 2013.

/more...

[amandabeech]

125. When Clinton packed the Treasury with Wall Street types,

my worst fears were confirmed. I had read about his maneuvering with those Tyson crooks and polluters back in Arkansas, and I knew that it could get worse. Bill should have stuck Ross Perot in the Treasury. It couldn't have been worse. Clinton proved himself to be a total sell-out economically and a tool of the capitalist pigs, as we used to put it. Hilary will be no different, IMHO.

Like Britain, we no longer have a labor party. And we wonder why we can't get votes. Our economic policies are not worker friendly and, frankly, there are hordes out there who are not motivated exclusively by minority and reproductive rights, but don't think much of Republicans either. I've been talking about this stuff since the '70s, and I'm sick of being taunted as a "populist" by a lot of affluent dems who now seem to run the party. If we tank in 2006 and then in 2008, I wonder if the Dems will survive.

[UpInArms]

29. Gold Stays Near 25-Year High as Iran Concern Prompts Hedging

http://www.bloomberg.com/apps/news?pid=10000082&sid=aMc2ng0S0nlI&refer=canada

May 1 (Bloomberg) -- Gold stayed near a 25-year high as rising oil prices, stoked by tensions between Iran and western governments, increased the metal's attraction as a hedging tool.

The U.S. will press for sanctions against Iran in the United Nations, Secretary of State Condoleezza Rice said on ABC's ``This Week'' program yesterday. Tension over Iran's nuclear program has helped boost gold prices and sent oil prices to a record.

``News events, particularly with this ongoing Iranian situation'' and demand for gold ``as a hedge against inflation,'' will push the metal's price higher, David Land, a market analyst at CMC Markets, said from the Australian Stock Exchange.

Gold for immediate delivery rose as much as $7.20, or 1.1 percent, to $661.63, the highest since October 1980. The metal traded at $660.30 at 10.58 a.m. in London.

Crude oil traded above $72 a barrel in New York after Rice said Iran is ``playing games'' in its latest offer to negotiate on uranium enrichment. The Iran standoff sent oil prices to a record $75.35 a barrel last month, contributing to gold's 28 percent rise this year in Asia.

...more...

[UpInArms]

42. Gold futures climb above $660 an ounce in morning dealings

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BDBE34B72%2DA85B%2D4B62%2D9CD3%2DBC02D212B3B5%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- June gold climbed as high as $663.80 an ounce in New York to mark the highest futures level since late 1980, supported by a weaker U.S. dollar and ongoing concerns over Iran. The contract was last up $6.50 at $661. "Fueled by a fresh round of concerns about the deteriorating impasse with Iran and by the probability of oil supply disruptions (not to mention much higher prices), gold resumed it sharp ascent on Monday morning and promptly added as much as $10 to its already spectacular Friday gains," said Jon Nadler, an analyst at Kitco.com. July silver was up 37 cents at $14 an ounce and July copper added 78.5 cents to $3.299 a pound.

[JNelson6563]

44. The good news never stops coming!

Here's to gold!

:toast:

[UpInArms]

46. g'morning, Julie!

:donut:

How goes the revolution?

Glad to see you here!

:hi:

[UpInArms]

78. June Gold @ $658 oz

1:01 PM ET 5/1/06 JUNE GOLD UP $3.50 AT $658/OZ, BUT BELOW $663.80 HIGH

[UpInArms]

83. June Gold closes @ $660.20 oz - July Silver @ $13.965 oz

1:43 PM ET 5/1/06 JUNE GOLD UP $5.70, OR 0.9%, TO CLOSE AT $660.20/OZ IN NY

1:41 PM ET 5/1/06 JULY COPPER UP 10C, OR 3.1%, TO CLOSE AT $3.3205/LB

1:41 PM ET 5/1/06 JULY SILVER UP 2.5% TO END AT $13.965/OZ AFTER $14.13 HIGH

1:41 PM ET 5/1/06 JULY PLATINUM ENDS AT A RECORD $1,177.80/OZ, UP 1.3%

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BAFFA045E%2D9CD7%2D4D1E%2D9CCE%2D91DAAA7C9AFC%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- The front-month contract for gold futures closed above $660 an ounce Monday for the first time since late 1980, finding support from ongoing weakness in the U.S. dollar as well as tension between Iran and western nations. June gold rose $5.70 to close at $660.20 an ounce. July silver also climbed 33.5 cents to end at $13.965 an ounce after a high of $14.13. July copper added 10 cents, or 3.1%, to end at $3.3205 a pound and July platinum finished at a record $1,177.80 an ounce, up $14.50 for the session.

[UpInArms]

13. Dimson's Buddy, "Kenny Boy" Lay, prosecutor to face off at Enron trial

http://www.myrtlebeachonline.com/mld/myrtlebeachonline/business/14470299.htm

HOUSTON - Enron Corp. founder Kenneth Lay had a weekend to contemplate how his aggressive testimony in his fraud and conspiracy trial may have played with the eight women and four men chosen to decide his fate.

<snip>

The ex-chairman's performance during four days of testimony last week was in stark contrast to that of his co-defendant, former Enron Chief Executive Jeffrey Skilling. Lay was openly combative with John Hueston, the prosecutor who secured the indictment against him, where Skilling kept his temper in check despite a few flare-ups during his 7 1/2 days on the stand.

Sam Buell, a former prosecutor with the Justice Department's Enron Task Force who is a visiting professor at the University of Texas School of Law, said Hueston should wrap up his cross-examination fairly quickly Monday.

"To the extent Lay thought he could get this jury to the point where they wouldn't take the government's case seriously after his testimony, that's not happening," Buell said. "I would think at this point, the key for the government is to make the one or two critical additional points left to be made and sit down. A too-long cross can turn this back into Lay's favor."

<snip>

He also insisted he didn't lie to employees and investors in conference calls and meetings when he insisted Enron was strong despite having to record massive losses and a $1.2 billion writedown in shareholder equity in the third quarter of 2001.

...more...

Lay's Political Contributions

Total for this search: $429,560

Contributor
Occupation
Date
Amount
Recipient

LAY, KENNETH L
HOUSTON,TX 77001
ENRON CORPORATION
4/28/2000
$75,000
RNC/Repub National State Elections Cmte

LAY, KENNETH L
HOUSTON,TX 77001
ENRON CORPORATION
4/28/2000
$75,000
RNC/Repub National State Elections Cmte

LAY, KENNETH L
HOUSTON,TX 77001
ENRON CORPORATION
4/28/2000
$50,000
RNC/Repub National State Elections Cmte

LAY, KENNETH L
HOUSTON,TX 77001
ENRON CORPORATION
4/28/2000
$50,000
RNC/Repub National State Elections Cmte

LAY, KENNETH L
HOUSTON,TX 77019
10/31/2000
$25,000
Ashcroft Victory Cmte Non-Federal

LAY, KENNETH L
HOUSTON,TX 77019
ENRON CORPORATION
3/2/1999
$25,000
RNC/Repub National State Elections Cmte

...more...

Ken Lay - Bush Pioneer

Name: Kenneth Lay
Occupation: Chair & CEO, Enron Corp.
Industry: Energy & Natural Resources
Home: Houston, Texas
1999 Salary & Perks: $42.4 Million

The $550,025 that the Enron Corp. gave Bush over the years makes it his No. 1 career patron, according to the Center for Public Integrity. “Virtually every … aspect of Enron’s operations is overseen by the federal government,” a ’96 Dallas Morning News story noted. Not surprisingly, this global natural gas giant and its top executive are big political contributors who keep revolving doors whirling. Lay hired President Bush’s cabinet members James Baker and Robert Mosbacher as they left office. After President Bush’s ’93 Gulf War victory tour of Kuwait, Baker and other members of his entourage stayed on to hustle Enron contracts. The Clinton administration also threatened to cut Mozambique’s aid in ’95 if the world’s poorest country awarded a pipeline contract to a different company. Enron got Bush to contact Texas’ congressional delegation in ’97 to promote a corporate welfare program in which U.S. taxpayers finance political risk insurance for the foreign operations of corporations such as Enron. Enron plants around Houston—which surpassed LA for the title to the nation’s worst air—are “grandfathered” air polluters that exploit a loophole in state law to avoid installing modern pollution-control technologies. Earlier this year the Houston Astros inaugurated their new Enron Field, which was financed with $180 million in public tax dollars and $100 million from Enron. In return, Enron landed tax breaks and a $200 million contract to power the stadium. Topping Enron’s political wish list in Texas was deregulation of the state’s electrical markets. Bush signed this dream into law in ’99.

[UpInArms]

21. Rotten to the Core: Powerful CEOs Cede Control As They Testify

http://news.yahoo.com/s/ap/20060430/ap_on_bi_ge/enron_goliaths_on_the_stand

HOUSTON - Testifying in his federal fraud trial last week, Enron Corp. founder Kenneth Lay quibbled and qualified, stuttered and stammered, wondered aloud where the questions were going.

<snip>

When cross-examination began, Lay was scowling so intensely, so visibly thrown by being pushed around, that it wasn't hard to imagine him producing a pistol and challenging the prosecutor to a duel at 20 paces.

<snip>

Hueston, who makes less in a year than Lay averaged on a single day when Enron was flying high, was the perfect David to Lay's Goliath — boyish, buttoned-down, soft-spoken, utterly composed.

It was Mr. Hueston versus Mr. Houston. And it wasn't pretty.

...more...

[UpInArms]

74. Prosecutor: Lay Ignored Accounting Worries

http://www.forbes.com/entrepreneurs/feeds/ap/2006/05/01/ap2710846.html

Enron Corp. founder Kenneth Lay ignored employees' concerns about accounting integrity in the weeks before the company collapsed in 2001, a prosecutor sought to show Monday.

On the third day of cross-examination in his federal fraud and conspiracy trial, Lay again flashed his temper to prosecutor John Hueston, comparing Hueston's second-guessing of his decisions during Enron's downward spiral to carving up a corpse.

Lay was confronted with e-mails and survey responses from October 2001 in which employees raised questions about accounting "trickery" and Enron's business ethics.

One veteran Enron employee said, "I've lost all respect for Enron senior management" and suggested it was criminal for Enron executives to exercise stock options when they knew accounting tricks were being used to manipulate earnings.

...more...

[wordpix]

102. "I'm innocent, I didn't know about the criminal activity." Right, Kennyboy

[UpInArms]

15. Sara Lee closing Ohio plant this fall

http://www.sacbee.com/24hour/jobs/story/3275723p-12082459c.html

CINCINNATI (AP) - Sara Lee Corp. will close an aging luncheon meat plant in Ohio this fall, eliminating 350 jobs.

Production will move to other food and drink plants, the food and household products company said Friday. About 100 jobs will be added to the 400 at a plant in Claryville, Ky.

A specific closing date wasn't announced for the 78-year-old E. Kahn's and Sons plant. The brand dates back to 1883 and was acquired by Chicago-based Sara Lee in 1966. The plant made deli meats under several brands, including Kahn's, Hillshire Farms and Sara Lee.

The jobs being cut include 300 represented by the United Food and Commercial Workers Union, and 50 nonproduction and engineering workers.

...more...

[UpInArms]

18. Groups Opposing Wal-Mart Get Help From New Web Site

http://www.nytimes.com/2006/05/01/business/01walmart.html?ex=1304136000&en=db1452fb34fa92e9&ei=5088&partner=rssnyt&emc=rss

(free registration or try www.bugmenot.com)

Trying to stop a Wal-Mart from coming to town? Hit the print button.

Two groups, Wal-Mart Watch and Sprawl-Busters, have teamed up to create an online toolkit for community groups opposing the giant discount retailer. The site, called Battlemart, features everything a local activist needs: grants (to start a citizens' group), reports on the economic impact of a Wal-Mart (to be submitted to a local city council), the names of local traffic engineers (to testify at zoning hearings), and even advice on how to name a group (try " First.").

Battlemart, which will be formally introduced today, is intended to "level the playing field" for residents facing off against a company with 5,000 stores and $300 billion in annual sales, said Al Norman, the founder of Sprawl-Busters and the author of "Slam-Dunking Wal-Mart," a guide to keeping giant national stores in check. "It's a grab and go," Mr. Norman said. "You download it and take it to your Sunday night citizens' group. They say, oh, we need a lawyer and a assessor, letters to the editor."

Battlemart even offers fund-raising tips for fledgling anti-Wal-Mart groups. "Avoid very labor-intensive events like car washes and bake sales," it advises.

Wal-Mart Watch — which has received hundreds of thousands of dollars from the Service Employees International Union — will be host of the Web site and offer start-up grants of $500 to $3,000. So far, it has financed 10 groups, including Gresham First in Gresham, Ore., and Great Falls First in Great Falls, Mont.

Battlemart (www.walmartwatch.com/battlemart) reflects the degree to which the debate over Wal-Mart, once confined to living rooms and union halls, has now shifted to the Web.

...more...

[UpInArms]

25. China: Next Step for Counterfeiters: Faking the Whole Company

http://www.nytimes.com/2006/05/01/technology/01pirate.html?_r=1&oref=slogin

BEIJING — At first it seemed to be nothing more than a routine case of counterfeiting in a country where faking it has become an industry.

In mid-2004, managers at the Tokyo headquarters of the Japanese electronics giant NEC started receiving reports that pirated keyboards and blank CD and DVD discs bearing the company's brand were on sale in retail outlets in Beijing and Hong Kong. So like many other manufacturers combating intellectual property thieves in China, the company hired an investigator to track down the pirates.

After two years and thousands of hours of investigation in conjunction with law enforcement agencies in China, Taiwan and Japan, the company said it had uncovered something far more ambitious than clandestine workshops turning out inferior copies of NEC products.

The pirates were faking the entire company.

Evidence seized in raids on 18 factories and warehouses in China and Taiwan over the past year showed that the counterfeiters had set up what amounted to a parallel NEC brand with links to a network of more than 50 electronics factories in mainland China, Hong Kong and Taiwan.

...more...

[UpInArms]

26. Treasuries slip on core inflation above forecasts

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T125129Z_01_N01450001_RTRIDST_0_MARKETS-BONDS-UPDATE-1.XML

NEW YORK, May 1 (Reuters) - U.S. Treasury debt prices slipped on Monday after a core inflation gauge came in stronger-than-expected, slightly reinforcing the case for Federal Reserve rate increases to contain inflation.

The core PCE price index for March, the Fed's preferred measure of inflation, rose 0.3 percent, above economists' expectations for an 0.2 percent rise and up from an 0.1 percent rise the month before.

Longer Treasury maturities are especially vulnerable to signs of rising inflation pressures, which erode a bond's value over time.

Benchmark 10-year notes <US10YT=RR> fell 5/32 in price for a yield of 5.08 percent, versus 5.06 percent shortly before the report and versus 5.06 percent late on Friday.

Bond yields move inversely to prices.

"We are getting a small sell-off in Treasuries, with the core PCE coming in slightly stronger than the market had expected," said Joseph Shatz, government strategist with Merrill Lynch in New York.

...more...

[UpInArms]

34. Printing Press Hums: Fed adds temporary bank reserves via overnight repos

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T133503Z_01_N01453755_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, May 1 (Reuters) - The Federal Reserve on Monday said that it added temporary reserves to the banking system via overnight repurchase agreements.

The benchmark fed funds rate last traded at 4.813 percent, above the Fed's 4.750 percent current target for the overnight lending rate on loans between banks.

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

[UpInArms]

43. Treasuries fall after stronger than expected ISM

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T141325Z_01_NYG000200_RTRIDST_0_MARKETS-BONDS-URGENT-UPDATE-2-REPEAT.XML

NEW YORK, May 1 (Reuters) - U.S. Treasury debt prices slipped on Monday, adding to earlier losses after a key reading of manufacturing activity was stronger than expected.

The Institute for Supply Management's April reading was 57.3, above economists' median forecast for a 55.0 reading and 55.2 in March.

Benchmark 10-year notes <US10YT=RR> fell 14/32 in price for a yield of 5.12 percent, versus 5.06 percent late on Friday. Bond yields and prices move inversely.

...more...

[Robbien]

54. "Money Meddlers" article on Korean monetary stabilization bonds

Interesting opinion piece concerning Asian support of the dollar:

Various Korean officials have declared that the current upward movement in the won have been too rapid. Without empirical evidence or theoretical propositions to identify a "correct" rate of increase in or valuation of the won, perhaps they have consulted with the Delphi Oracle.

To support these steps, the Planning and Budget Ministry has abandoned plans to issue fewer currency stabilization bonds that are used to acquire funds to intervene on behalf of the won. A surge in monetary stabilization bonds occurred from growing foreign reserves that impose extra cost on the central bank and weaken monetary policy.

As it is, the BOK is expected to have to pay about 6 trillion won ($5.77 billion) in interest payments this year on monetary stabilization bonds floated to control the money supply. The interest payments on the bond totaled 5.58 trillion won last year.

These bonds and debts arising from an expansionary fiscal policy have grown more rapidly than GDP and have pushed up South Korea's public-sector debt beyond 200-trillion won. Future taxpayers will be forced to pay interest on these bonds.

But taxpayers will be also presented with a bill for foreign exchange losses from the so-called stabilization bonds. After all, the funds will be used to purchase a depreciating asset since the dollar is weakening against most other currencies.

Given the trend for the US dollar to weaken, intervention in foreign exchange markets will be fruitless. As long as there is an excess supply of the US currency, it will continue to weaken.

And so a question arises over why such futile but costly steps are undertaken. The answer lies in the fact that absence of economic logic never stops politicians or central bankers or finance ministry bureaucrats from feathering their own nests or those of their sycophants.

more
http://www.tcsdaily.com/article.aspx?id=050106F

[UpInArms]

58. it logic ever rears its head, these foreign central banks

will drop the dollar like a hot potato - as soon as it becomes apparent that they are throwing money down a rathole and their citizenry realizes that they are being robbed on a daily basis.

[UpInArms]

56. 30-yr Treasury yield hits highest since July 2004

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T150646Z_01_NYG000202_RTRIDST_0_MARKETS-BONDS-URGENT-UPDATE-4.XML

NEW YORK, May 1 (Reuters) - The 30-year Treasury bond's yield rose to its highest since July 2004 on Monday in the wake of U.S. economic reports hinting at rising inflation.

The 30-year bond <US30YT=RR> fell 29/32 in price for a yield of 5.23 percent according to Reuters data, versus 5.16 percent late on Friday.

Bond yields move inversely to their prices. The long bond is particularly vulnerable to rising inflationary pressures, which erode the value of longer maturities over time.

[UpInArms]

57. is the yield curve inverting again?

11:25 EST

10-Yr Bond 51.28 +0.59 (+1.16%)

[UpInArms]

96. US "borrowed" $158 Billion in 1st Quarter - says SS fund exhausted by 2040

3:00 PM ET 5/1/06 U.S. BORROWED $158 BILLION IN FIRST QUARTER

3:00 PM ET 5/1/06 U.S. EXPECTS TO BORROW $89 BILLION IN FOURTH QUARTER

3:00 PM ET 5/1/06 U.S. EXPECTS TO PAY DOWN $51 BLN IN THIRD QUARTER

3:00 PM ET 5/1/06 TRUSTEES SEE MEDICARE TRUST FUND EXHAUSTED IN 2018

3:00 PM ET 5/1/06 TRUSTEES SEE SOCIAL SECURITY TRUST FUND EXHAUSTED IN 2040

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BF07E2972%2D64B6%2D4DCF%2D900A%2DE311677C3D7F%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- The U.S. government expects to pay down $51 billion in debt during the April to June period, the Treasury Department announced Monday. It's $21 billion more than announced in January. The government also expects to borrow $89 billion in the fourth quarter. In the second quarter, Treasury said, the government borrowed $158 billion, down from the $188 billion it expected to borrow.

Do you think there may be a correlation between all that borrowing and the exhaustion of worker funded FICA and Medicare funds?

What happened to the 2nd quarter numbers?

[UpInArms]

98. Trustees see earlier exhaustion of Medicare, Soc. Sec. funds

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BA7E6ED0D%2D309D%2D4195%2D8D06%2D14759EC20806%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Social Security and Medicare trustees expect Medicare to exhaust its hospital-insurance trust fund by 2018, two years earlier than projected last year. In their annual report, released Monday, the trustees projected that the Social Security system would exhaust its trust fund in 2040, one year earlier than projected in 2005. Social Security revenues are expected to continue to exceed outlays through 2017, unchanged from last year's projection. "Those who depend on Social Security and Medicare urgently need the best efforts of those of us in public life and in the private sector to address the long-term funding issues," said Treasury Secretary John Snow, who led the Bush administration's failed 2005 effort to add private investment accounts to the Social Security system.

[UpInArms]

28. Comverse founder, senior management resigns (during acct'ng probe)

http://today.reuters.com/business/newsArticle.aspx?type=technology&storyID=nN01437976

NEW YORK, May 1 (Reuters) - Software maker Comverse Technology Inc. (CMVT.O: Quote, Profile, Research) on Monday said its founder and senior executives had resigned from the company while it was in the midst of an internal probe on its stock option grants.

Shares in Comverse fell 2.9 percent, to $22, in premarket trading on the Inet electronic exchange after the resignations were announced.

The departing executives include Comverse founder Kobi Alexander, who also served as chairman and chief executive, Chief Financial Officer David Kreinberg and general counsel and corporate secretary William Sorin.

<snip>

Comverse said last month it would miss a regulatory deadline for filing its annual report and probably restate earnings back to 2001 due to the recorded timing of stock options grants to executives.

...more...

[UpInArms]

51. (same 3 in Comverse) 3 Verint Systems Board Members Resign

http://www.chron.com/disp/story.mpl/ap/fn/3831432.html

MELVILLE, N.Y. — Verint Systems Inc., which makes communications and surveillance software, said Monday three board members resigned on Friday from their posts as well as their committee positions.

Kobi Alexander stepped down from his roles as chairman of the board and as a member of the Compensation Committee and Executive Committee. David Kreinberg and William F. Sorin were also members of the Compensation Committee and Executive Committee.

The resignations come after all three individuals resigned from their roles at Comverse Technology Inc., which is a majority shareholder in Verint. Alexander served as chief executive officer and chairman of the board, while Kreinberg served as chief financial officer and Sorin served as senior general counsel and corporate secretary.

[UpInArms]

31. pre-opening blather

09:15 am : S&P futures vs fair value: +1.7. Nasdaq futures vs fair value: +2.8.

09:00 am : S&P futures vs fair value: +1.8. Nasdaq futures vs fair value: +2.0. Still shaping up for the indices to start the month of May modestly higher. Speaking of, anticipation of new fund inflows on the first trading day of the month, which is typically cited as a bullish factor for the market, may also be improving underlying sentiment. Some M&A news is also lending support. Boeing (BA) is reportedly in advanced talks to acquire Aviall Inc. for about $1.7 bln while Level 3 Communications (LVLT) plans to buy TelCove Inc. for $1.24 bln.

08:34 am : S&P futures vs fair value: +1.5. Nasdaq futures vs fair value: +3.0. Stage remains set for stocks to open slightly higher as futures indications hold relatively steady following economic data. Mar. personal income rose 0.8%, above forecasts of 0.4%, while personal spending rose 0.6%, also higher than expectations of 0.4%. More notably, the core PCE deflator rose 0.3%, slightly higher than forecasts to leave a 2.0% year-over-year rate but still suggesting inflation remains under control. Bonds, which were off slightly ahead of the data, have weakened a bit, as the 10-yr note is now down 3 ticks to yield 5.06%.

08:00 am : S&P futures vs fair value: +2.0. Nasdaq futures vs fair value: +2.8. Futures versus fair value are signaling a modestly higher open for the cash market. Wal-Mart (WMT) reporting April same-store sales growth of 6.8% versus guidance of 4-6% is providing a floor of early buying support, especially for a plethora of retailers also expected to post monthly comps later in the week, while Friday's 2.3% sell-off in Technology may be inciting some early bargain hunting opportunities, as evidenced by a postive pre-market bias on the Nasdaq.

[UpInArms]

32. 9:31 EST Rah! Rah! Siss! Boom! Bah! Wheee!

Dow 11,411.08 +43.94 (+0.39%)
Nasdaq 2,334.52 +11.95 (+0.51%)
S&P 500 1,314.46 +3.85 (+0.29%)
10-Yr Bond 5.078 +0.09 (+0.18%)

NYSE Volume 44,140,000
Nasdaq Volume 63,896,000

[UpInArms]

35. U.S. stocks open higher after robust spending data

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T133654Z_01_N01284226_RTRIDST_0_MARKETS-STOCKS-UPDATE-3-URGENT.XML

NEW YORK, May 1 (Reuters) - U.S. stocks rose on Monday after a government report on personal spending showed robust consumer activity bolstering the economy, but the stronger-than-expected data also suggested higher inflation.

...more...

[UpInArms]

33. How 'Bout that Libral Media!

info drawn from:

http://www.washingtonpost.com/wp-dyn/content/linkset/2005/04/11/LI2005041100587.html

Tony Snow, a former speechwriter for the first President Bush

George Stephanopoulos, a top political adviser to President Bill Clinton

David Gergen, editor at large of U.S. News & World Report, returned to journalism after separate stints with the Nixon, Ford, Reagan and Clinton administrations.

Tim Russert, NBC's Washington bureau chief and host of "Meet the Press," worked for Democrats Mario Cuomo and Daniel Patrick Moynihan

Chris Matthews, host of "Hardball" on MSNBC, had worked for Jimmy Carter and Tip O'Neill

Joe Scarborough, who has a nightly show on the cable network, is a former Republican congressman

Mary Matalin was political director of George H. W. Bush's 1992 campaign, then went on to co-host a CNBC show

Tony Blankley, editorial page editor of the Washington Times, recalls making his first paid speech after serving as spokesman for Newt Gingrich

Gingrich, for his part, is now a Fox News commentator

Dorrance Smith. He worked in the Ford White House, went on to become executive producer of ABC's "This Week with David Brinkley" and "Nightline," then became a senior adviser to the first President Bush. Smith returned to ABC as executive producer of "This Week" and recently signed on as Donald Rumsfeld's top spokesman at the Pentagon

Bill Kristol, who was Vice President Quayle's chief of staff, is now editor of the Weekly Standard

Paul Glastris, a Clinton White House aide, now edits the Washington Monthly

Pete Williams, who was Cheney's spokesman at the Pentagon, covers law enforcement for NBC

Peggy Noonan, a onetime speechwriter for Ronald Reagan and George H.W. Bush, became a Wall Street Journal columnist but took a leave in the fall of 2004 to work for Bush's reelection

G. Gordon Liddy proved by becoming a successful radio talk show host after serving time for the Watergate break-in

[UpInArms]

37. PIEHOLE ALERT: It's Shit Spewing Time again

9:58 AM ET 5/1/06 BUSH: NEW GOVERNMENT IS 'TURNING POINT' FOR IRAQI CITIZENS

[UpInArms]

39. GM CEO apologizes to holders for accounting errors (since 2000)

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B85C25C5C%2DE601%2D4FF2%2D9D47%2DBEF13723F572%7D&symbol=

DETROIT (MarketWatch) -- In a letter distributed to shareholders Friday, General Motors Corp. (GM) Chairman and Chief Executive Rick Wagoner apologized for the company's highly publicized accounting errors and promised the auto maker is "moving aggressively to strengthen" internal accounting.

"The recent discovery of prior-year accounting errors has been extremely disappointing and embarrassing to all of us," Wagoner said in the letter, which accompanied the auto maker's 2005 annual report. "Credibility is paramount, for GM as a company and for me personally."

Late in 2005, the company disclosed that the Securities and Exchange Commission was probing various accounting issues and, in March, the company adjusted earnings dating back to 2000 in its fourth-quarter 10-K. The SEC investigations and accounting errors have further weakened the credibility of the world's largest auto maker, which posted a loss of $10.6 billion in 2005.

<snip>

Wagoner said in the letter that GM's financial losses are "unsustainable" and that the company is "working diligently to get things moving in the right direction - quickly."

...more...

[UpInArms]

41. GM CEO Wagoner got $5.5M in total 2005 compensation

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B33ABE357%2D15F4%2D4C7A%2DAD49%2D5C22E4F0A5A8%7D&symbol=

WASHINGTON (MarketWatch) -- General Motors Corp. (GM) said Friday that Chief Executive Rick Wagoner received $5.48 million in total pay last year, a nearly 50% cut from his 2004 pay of $10.07 million.

Wagoner's salary remained unchanged at $2.2 million, but he didn't receive a bonus for 2005, according to the automaker's proxy filed with the Securities and Exchange Commission.

For 2004, he received a $2.46 million bonus.

Wagoner received 400,000 options valued at $2.88 million as part of his 2005 compensation. A year earlier, he received the same number of options, which were valued at $5.14 million when granted. Neither Wagoner nor other top General Motors executives exercised options during 2005, which saw the company's stock nearly halve in value by year's end, to $19.42 each from a July high of $37.52 a share.

Other GM executives also took similar cuts in total pay. Former financial chief John Devine's total 2005 pay was $3.89 million, down from $6.44 million received for 2004. Devine was replaced at the end of last year by Frederick Henderson, former chairman of GM Europe.

...more...

[wordpix]

89. aww, the poor CEO only got $5.5 million, down from $10.1 million in '04

This is disgusting. If I were a GM worker who lost my job, I'd be suing.

[UpInArms]

47. Delphi says can't extend GM deal on higher prices

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T141539Z_01_N01442718_RTRIDST_0_AUTOS-DELPHI-UPDATE-2.XML

CHICAGO, May 1 (Reuters) - Bankrupt auto parts maker Delphi Corp. (DPHIQ.PK: Quote, Profile, Research) on Monday said it could not reach a deal with General Motors Corp. (GM.N: Quote, Profile, Research) to extend an agreement under which the U.S. automaker would pay higher prices for Delphi parts.

Delphi, which filed for bankruptcy court protection for its North American operations last October and is seeking to void its union contracts, said on March 31 that it would seek to end or renegotiate the unprofitable GM supply contracts.

Delphi, which was spun off from GM in 1999, said its net sales will begin to reflect the contractual price reductions it must provide GM as of April 1.

GM had foregone price reductions previously agreed to by Delphi through the first quarter, but Delphi said that as of April 26 the companies could not agree on terms to extend that agreement.

In March, Delphi filed a motion in a U.S. Bankruptcy Court in New York to void its U.S. labor contracts with the United Auto Workers and the International Union of Electrical Workers-Communications Workers of America, cut up to 8,500 salaried workers and close or sell a third of its plants globally in its attempt to slash costs and restructure its operations.

...more...

hmmmm.... Delphi was "spun off in 1999" and GM's accounting errors started in 2000 :eyes:

[UpInArms]

55. GM, Ford most active US default swaps in April-GFI

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T151403Z_01_N01189_RTRIDST_0_MARKETS-SWAPS-GFI.XML

NEW YORK, May 1 (Reuters) - Credit default swaps on the finance units of General Motors Corp. (GM.N: Quote, Profile, Research) and Ford Motor Co. (F.N: Quote, Profile, Research) were the most actively traded in the U.S. in April, interdealer broker GFI Group said on Monday.

Swaps on the automakers and their subsidiaries General Motors Acceptance Corp. and Ford Motor Credit Co. have been among the most volatile since last May, when Standard & Poor's lowered both automakers' debt into junk territory.

<snip>

Swaps on the both parent companies' debt, however, have worsened on concerns about their operating performance. Ford's spreads have deteriorated, widening by 27 percent to 942 basis points, compared with 740 basis points last May.

Swap spreads on GM, meanwhile have shifted to an upfront payment, which typically indicates a company under stress. The cost to insure GM's debt is now 17 percent the sum insured upfront, in addition to annual payments of 5 percent, compared with a spread of 905 basis points last May.

...more...

[UpInArms]

88. GM to Recall About 400,000 Pickup Trucks

So when does Waggoner apologize for foisting junk onto the market?

http://news.yahoo.com/news?tmpl=story&cid=509&e=6&u=/ap/20060501/ap_on_bi_ge/gm_recall

DETROIT - General Motors Corp. is recalling about 400,000 pickup trucks due to defective brake lights.

The affected vehicles are the Chevrolet Colorado and GMC Canyon from the 2004-2006 model years and the 2006 Isuzu i-280 and i-350.

GM said some vehicles may permanently lose brake-lamp function or have brake lamps that are always on. On vehicles with cruise control, that function also becomes inoperative.

GM spokesman Alan Adler said the company was not aware of any crashes resulting from the problem.

Dealers will replace the brake lamp switch assembly in the affected vehicles at no charge.

...more...

[UpInArms]

104. GM seen leading April auto-sales dip

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B510D9D19%2D344C%2D42F5%2D9D86%2D82B16E7F7E24%7D&symbol=

SAN FRANCISCO (MarketWatch) -- Automakers are slated to report April U.S. sales figures Tuesday, with analysts looking for General Motors Corp. to lead an industry decline.

The drop may come despite the continued strength of the Detroit giant's new SUV and pickup line, in the face of rising gas prices.

Analysts polled by Thomson First Call forecast the overall sales rate, known as the SAAR, to come in at 16.6 million vehicles -- down from 17.2 million a year ago, but up fractionally from March.

Michael Ward of Soleil Securities said he expects to see a SAAR of 16.2 million, well below the consensus average.

"The feedback from April has been quiet, but with one less selling day and the midmonth religious holidays, the expectation is for softer sales," he added. "Weaker sales in the summer months and higher gas prices are likely to keep the headlines negative for the group."

The current average price for a gallon of gas, according to AAA, has surged to $2.92, up from $2.55 a month ago and $2.24 last year, giving rise to concerns that consumers will step up their exodus from the high-profit SUVs in favor of the smaller, lower-margin cars.

...more...

[stop the bleeding]

60. Good morning marketeers

Thank you for the information, this page should be on other sites as a source for fincance information.

You guys ROCK!!!

[UpInArms]

63. g'morning stop the bleeding!

:blush:

My thanks always go to Ozy - the leader of the pack - the never-fail-DUer that gets up and starts this thread every day and keeps us all on an even keel. :D

[stop the bleeding]

68. he should charge a fee for this service

:)

[AnneD]

92. Welcome

:hi: Stop the bleeding. If thank you's were dollar bills, Ozy could retire now and live on his yacht. He's our local hero. :loveya:

[UpInArms]

65. Sea Containers delays acct'ng report - doubts survivability

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-01T155011Z_01_N01450969_RTRIDST_0_TRANSPORT-SEACONTAINERS-UPDATE-3.XML

CHICAGO, May 1 (Reuters) - Sea Containers Ltd. (SCRa.N: Quote, Profile, Research) on Monday delayed filing its annual report for 2005 and warned that it expects its auditors to raise "substantial doubt" about its ability to survive, sending shares down almost 27 percent.

The passenger and freight transport company said it had sustained operating losses again in 2005, as it did in 2004, and that it expected those losses to continue at least through 2006.

Sea Containers said the 2005 losses "included significant impairment charges taken in the fourth quarter" and that it was now in default on some of its credit agreements. It said, however, that no lenders had taken any action with respect to those defaults.

The company also said it had received a ruling from the arbitrator hearing its dispute with General Electric Co.'s (GE.N: Quote, Profile, Research) GE Capital over the costs of GE SeaCo, a marine container leasing joint venture between the two companies.

...more...

[UpInArms]

66. 12:08 EST still partying with blather

Dow 11,406.92 +39.78 (+0.35%)
Nasdaq 2,324.49 +1.92 (+0.08%)
S&P 500 1,313.39 +2.78 (+0.21%)
10-Yr Bond 5.135 +0.66 (+1.30%)

NYSE Volume 1,032,322,000
Nasdaq Volume 863,502,000

12:00 pm : Despite more strong economic data supporting the possibility that the Fed may go too far with its tightening -- worries that play into our Neutral market view, the indices are trading higher midday.

Before the bell, March personal spending rose 0.6% (consensus 0.4%) and personal income rose 0.8%, the biggest increase since September, reflecting the underlying strength in consumer spending trends. More notably and posing a bit of concern, however, was the accompanying core PCE deflator. Known as the Fed's primary inflation indicator, the deflator rose 0.3%, the largest rise since October, pushing the year-over-year increase to 2.0% from 1.8% and raising fears about mounting inflationary pressures. Later data also showed that overall construction activity has yet to slow down and that national manufacturing activity remains robust, weighing heavily on sentiment among bond traders. The yield on the 10-yr note (-19/32) has climbed back to its highest levels (5.13%) in four years.

Nevertheless, little evidence that higher interest rates have curtailed the momentum in the economy coupled with data showing that high gas prices still aren't slowing down the consumer have underpinned a floor of support for stocks. In particular, shares of Wal-Mart (WMT 46.35 +1.32) have surged 2.9% after reporting a preliminary 6.8% rise in April same-store sales. That growth exceeds prior forecasts of 4-6% growth and sets the stage for a plethora of retailers expected to report strong monthly figures later in the week. Also helping offset weakness in the rate-sensitive Financial and Utilities sectors has been leadership in Energy and Materials. A 1.4% surge in the price of crude amid ongoing geopolitical concerns has helped refiners and explorers extend their impressive year-to-date gains. Also benefiting from further deterioration in the greenback and gaining more than 1.0% has been Materials. The sector has gotten an extra boost as an analyst upgrade helps lift U.S. Steel (X 72.22 +3.72) to a historic high. DJ30 +41.70 NASDAQ +1.78 SP500 +2.81 XOI +1.7% NASDAQ Dec/Adv/Vol 1622/1279/834 mln NYSE Dec/Adv/Vol 1312/1769/696 mln

11:30 am : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges. Of the seven sectors trading higher, Energy and Materials -- the year's two best performing sectors, continue to pace the way higher with gains of more than 1.0%. However, since both combine to account for just 12.9% of the total weighting on the S&P 500, compared to a 21% weighting for the Financial sector which is the worst performing sector this morning (-0.7%), market gains remain modest at best.DJ30 +35.46 NASDAQ +1.96 SP500 +2.58 NASDAQ Dec/Adv/Vol 1588/1277/726 mln NYSE Dec/Adv/Vol 1337/1687/596 mln

[ozymandius]

70. At no cost and provided with pleasure - numbers and blather

We are still scary at work today. Consider this a drive-by posting.

12:48
Dow 11,398.76 +31.62 (+0.28%)
Nasdaq 2,320.45 -2.12 (-0.09%)
S&P 500 1,312.62 +2.01 (+0.15%)
10-Yr Bond 51.37 +0.68 (+1.34%)
NYSE Volume 1,183,388,000
Nasdaq Volume 1,014,275,000

12:30 pm : Indices are retracing session lows as oil prices hit their highest levels of the day. Within the last 30 minutes, crude oil futures have surpassed $73 a barrel and are now up 1.8%. Follow-through buying after Friday's rally, more worries that Iran's nuclear ambitions will cut worldwide oil supplies and the dollar flirting with 12-month lows are the catalysts behind today's momentum. DJ30 +20.17 NASDAQ -2.65 SP500 +0.96 NASDAQ Dec/Adv/Vol 1625/1302/946 mln NYSE Dec/Adv/Vol 1400/1713/790 mln

EDIT: I have missed DU and you Marketeers the past few days. Thanks for the kudos stopthebleeding. And thanks for you, UIA, for shouldering the load of updates.

Ozy :hi:

[UpInArms]

90. Right-Winger Obsessed with Oral Sex challenges Sarbanes-Oxley

Starr Mounts Challenge to Sarbanes-Oxley

http://news.yahoo.com/s/ap/20060428/ap_on_go_ot/sarbanes_oxley;_ylt=AqIwJVkzZj1B.sc1XrQROBSyFz4D;_ylu=X3oDMTA5aHJvMDdwBHNlYwN5bmNhdA--

WASHINGTON - A constitutional challenge by conservatives to the law that reshaped corporate governance after a wave of business scandals likely will end up before the Supreme Court, attorney Kenneth Starr says.

The legal action that Starr is mounting against the Sarbanes-Oxley anti-fraud law is one of a trio of assaults targeting it, as small companies push for regulatory exemptions and some lawmakers prepare legislation to change it. With memories fading of the corporate fiascos of 2002 that began with Enron Corp.'s collapse, opponents of the law and its mandates on public companies and the accounting industry are banking on a changing political climate.

Starr, the former special prosecutor who led the Monica Lewinsky and Whitewater investigations of President Clinton, is one of the attorneys bringing the federal court case on behalf of a pro-business conservative group, the Free Enterprise Fund. They are challenging the board established by the 2002 law to oversee the accounting industry, arguing that it violates the Constitution's mandated separation of powers among the three branches of government. nutspeak for *Co doesn't have enough power

"This constitutes an excessive delegation of power by the executive branch," Starr said in a telephone interview Thursday.

<snip>

Starr, who now is the dean of Pepperdine University's law school in California, is litigating the case with Viet Dinh, a former assistant attorney general in the Justice Department in Bush's first term, and Michael Carvin, a private attorney who was a member of the Bush legal team during the presidential vote recount in 2000.

...more...

[wordpix]

100. it's official: repukes want to repeal anti-fraud law; repukes want fraud!

:puke:
How much more transparent can they be that they are a group of criminal conspirators?

[fedsron2us]

101. What do you expect in a kleptocracy.

[UpInArms]

95. Hedge Fund Alert: Long-expected small-cap correction may be at hand

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B7B5E200B%2D2E79%2D4C97%2D9651%2D9F36054017F1%7D&symbol=

NEW YORK (MarketWatch) - The long-expected correction of the high-flying small-cap stock sector may finally be at hand and the trigger seems to be the withdrawal of hedge fund capital that is hurriedly making its way toward gold and other rallying commodities.

Citigroup analyst Albert Richards noted that the small cap Russell 2000 ($RUT 767.45, +2.91, +0.4% ) index ended April with a nearly flat result, closing down 0.1% on the month to lag the solid 1.2% gain registered by the large-cap S&P 500 ($SPX 1,314.53, +3.92, +0.3% ) . By contrast, for the entire first quarter the Russell 2000 shot up 14%, sharply exceeding the 3.7% increase posted by the S&P 500, and extending the surprisingly durable rally in small-cap stocks that began in October, 2002.

Last month's flat performance by small caps could mark the beginning of a period of weakness, said Prudential Equity Group chief small-cap analyst Steven DeSanctis, who believes small-cap valuations became too rich during the sector's three-and-a-half year rally.

DeSanctis noted that as of Monday, shares in the Russell 2000 were priced at 18.8 times their forward earnings, while stocks on the large-cap Russell 1000 ($RUI 716.36, +1.99, +0.3% ) traded at just 15.6 times their forward earnings.

Historically, such a large gap between the 2 indexes is a classic signal of an approaching correction, he said.

...more...

[UpInArms]

103. 3:26 EST superficial (?) wound appearing

Dow 11,379.47 +12.33 (+0.11%)
Nasdaq 2,313.67 -8.90 (-0.38%)
S&P 500 1,309.25 -1.36 (-0.10%)
10-Yr Bond 5.131 +0.62 (+1.22%)

NYSE Volume 1,970,828,000
Nasdaq Volume 1,679,549,000

3:00 pm : Range-bound trading persists as stocks and bonds continue to trade in opposing directions. Treasuries are poised to close lower for just the first time in three sessions as this morning's batch of stronger than expected economic data continue to raise concerns that the central bank may go too far with hiking rates to keep inflation contained. The next FOMC meeting is May 10th and interest-rate futures currently price in a 100% certainty that the Fed will increase the overnight lending rate 1/4% for a 16th straight time to 5.00%. There is a 32% chance of another 1/4% increase at the July meeting, up from 28% last week. The 10-yr note is off 18 ticks to yield 5.12%. DJ30 +41.94 NASDAQ +1.09 SP500 +3.83 NASDAQ Dec/Adv/Vol 1591/1424/1.48 bln NYSE Dec/Adv/Vol 1395/1802/1.24 bln

2:30 pm : More of the same for the averages as the blue chips and Nasdaq continue to trade in opposing directions. Weakness from the two biggest semiconductor names -- Intel (INTC 19.60 -0.38) and Applied Materials (AMAT 17.69 -0.26) -- continues to weigh most heavily on the tech-heavy Composite. Helping the influential Tech sector cling to modest gains (+0.2%), though, has been relative strength in Networking. Cisco Systems (CSCO 21.28 +0.33), an Active Portfolio holding, and Comverse Technology (CMVT 24.01 +1.36), which has surged 6% after an internal probe into the timing of stock-option grants forced the resignation of its CEO and two managers.DJ30 +39.10 NASDAQ -0.77 SOX -0.5% SP500 +3.13 NASDAQ Dec/Adv/Vol 1605/1403/1.37 bln NYSE Dec/Adv/Vol 1428/1779/1.13 bln

[UpInArms]

105. 3:35 EST open bedsore bleeding faster

Dow 11,348.49 -18.65 (-0.16%)
Nasdaq 2,306.09 -16.48 (-0.71%)
S&P 500 1,305.96 -4.65 (-0.35%)
10-Yr Bond 5.131 +0.62 (+1.22%)

NYSE Volume 2,058,782,000
Nasdaq Volume 1,756,565,000

[UpInArms]

107. "Chopper" Ben claims media misunderstood the use of the word "pause"

from the blather report:

3:30 pm : Market spikes lower going into the close after CNBC reports that Fed Chairman Bernanke said the media misunderstood his remarks last week. The news, accompanying an interview with Chicago Fed President Moskow, has weighed heavily on bonds, lifting the yield on the 10-yr note as high as 5.145%. Further deterioration in bonds has prompted even more aggressive consolidation in the influential Financial sector while CNBC also reporting that Bernanke said it is worrisome that anyone would think of him as dovish has been a catalyst behind the Technology and Consumer Discretionary sectors turning negative. DJ30 -2.97 NASDAQ -11.24 SP500 -3.09 NASDAQ Dec/Adv/Vol 1606/1416/1.69 bln NYSE Dec/Adv/Vol 1432/1793/1.41 bln

[girl gone mad]

108. They had better hurry up and call in the..

Plunge Protection Team.

[UpInArms]

111. 3:47 EST reporting for duty!

Dow 11,354.97 -12.17 (-0.11%)
Nasdaq 2,302.71 -19.86 (-0.86%)
S&P 500 1,305.94 -4.67 (-0.36%)
10-Yr Bond 5.131 +0.62 (+1.22%)

NYSE Volume 2,185,765,000
Nasdaq Volume 1,896,389,000

[CabalPowered]

106. Ouch! Sucking canal water

http://finance.yahoo.com/q?s=%5EDJI

[UpInArms]

109. it depends on what the meaning of the word "pause" is

:eyes:

[UpInArms]

110. "Chopper" Ben screams: "I am NOT a dove! So Stop Saying That!"

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BC1AFA8AD%2DD538%2D428E%2DA4B8%2D2755038BA379%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Noted CNBC news anchor Maria Bartiromo announced on the air that she had a private conversation with Fed chief Ben Bernanke at a Washington dinner on Saturday and Bernanke told her that the media misunderstood his remarks. In testimony to Congress on Thursday, Bernanke said: "there is ... the possibility that if there is sufficient uncertainty, that we may chose to pause, simply to gain more information to learn better what the true risks are and how the economy is actually evolving." This remark was interpreted by the markets as a signal that the Fed would pause in June. Bartiromo said that Bernanke told her that he was trying to create flexibility for the central bank and data would determine rate moves.

Oh, Bennie Boy, I would never call you a "dove". I would call you a freakin' vulture.

[54anickel]

112. Economy Carries Momentum Into 2nd Quarter (Ruh-Roh!!!)

http://biz.yahoo.com/ap/060501/economy.html?.v=16

WASHINGTON (AP) -- The national economy carried its strong momentum into the second quarter as factories cranked up activity, builders boosted construction spending to a record high and consumers opened their pocketbooks ever wider.

But inflation picked up, too.

The information was contained in a trio of economic reports released Monday.

"Households and corporations are still very active and are creating economic momentum, which is tremendously encouraging news for the economy," said Carl Tannenbaum, chief economist at LaSalle Bank. "The only dark cloud comes from the news on prices, which are going up."

snip>

Thus far, the economy is motoring ahead despite rising interest rates and energy prices. :eyes: Ya mean like GM and Ford?

snip>

All three economic reports released Monday showed stronger economic activity than analysts were forecasting. That along with the inflation pickup "are issues the Fed will have to deal with," Tannenbaum said.

more...

[54anickel]

113. World on the Mend (Roach)

So, will it be an evolutionary or revolutionary process?

http://www.morganstanley.com/GEFdata/digests/20060501-mon.html#anchor0

It seems like eternity since I was last optimistic on the world economy. It was back in 1999 when I argued that “Global Healing” would allow the world to make a stunning comeback from the ravages of the worst financial crisis in 60 years. My enthusiasm was short-lived, however, as the cure led to the mother of all liquidity cycles, multiple asset bubbles, and an unprecedented build-up of global imbalances. While an unbalanced world has yet to shake its hangover from global healing, I must confess that I am now feeling better about the prognosis for the world economy for the first time in ages.

The reason: The world is finally taking its medicine -- or at least considering the possibility of doing so. Central banks are carefully adjusting the liquidity spigot -- taking advantage of the luxury of low inflation to move very slowly in doing so. This delicate normalization procedure is necessary to prevent wrenching financial market crashes that would spell curtains for an asset-dependent world. Meanwhile, the stewards of globalization -- especially the G-7 and the IMF -- have finally come to grips with the imperatives of facing up to the perils of global imbalances. They are now hard at work in developing a multilateral solution to a multi-economy problem. At the same time, orderly currency adjustments appear to have resumed -- and this time, in the right direction. Ever so slowly, the dollar is being managed lower -- in keeping with the relative price shift that a long-overdue US current account adjustment needs. As always, there are still plenty of serious risks -- especially oil, geopolitics, fiscal paralysis, and protectionism. But the world now appears to be getting its act together, and that encourages me.

Central banks remain leading actors in this drama. They almost blew it -- especially the monetary authorities in Japan and the US. By condoning asset bubbles and their concomitant distortions of debt cycles and increasingly asset-dependent real economies, both the BOJ and the Fed flirted with the most corrosive of macro diseases -- deflation. Japan actually succumbed to a mild, yet protracted, strain of this ailment, while the US had a close brush in 2003. The Fed studied the lessons of the Japanese experience carefully and made every effort to avoid a similar fate for the US (see A. G. Ahearne et al., “Preventing Deflation: Lessons From Japan's Experience in the 1990s,” Federal Reserve International Discussion Paper, June 2002). While Japan finally seems to be exiting from its long slump, the jury is still out in America, as one bubble (equities) has morphed into another (housing).

Central banks have been aided in their post-bubble tactics by an unexpected ally -- a persistent disinflation. Courtesy of a rapidly spreading globalization of both tradable manufactured activity and once nontradable services, powerful structural headwinds have dampened inflationary pressures that might have normally arisen from a cyclical recovery in the world economy. This has provided monetary authorities with the luxury of moving slowly in weaning economies from their post-bubble medicine. Had inflation responded more to the traditional pressures of the closed economy -- namely, domestic unemployment rates and capacity utilization rates -- monetary policy would have been forced into a more activist post-bubble tightening mode. Instead, the ongoing disinflation of increasingly open economies has transformed the role of central banks. Rather than playing the destabilizing function of leaning against the inflation cycle, the authorities have been given license to focus more on a goal of “normalization” -- seeking to put policy rates on a neutral setting that is neither too tight nor too easy. This has reduced the possibility that the world will be disrupted by the boom-bust cycles that frequently plagued the economy of yesteryear.

This is a delicate operation, to say the least. We are in the midst of what could well be the mother of all liquidity cycles. Courtesy of an extraordinary monetary accommodation, financial markets have enjoyed open-ended support from central banks. This has been a key role reversal for the tough guys who are supposed to take away the “punch bowl” just when the party gets good. Given the power of this liquidity cycle -- evidenced not just by asset bubbles in major markets but also by an extraordinary compression of spreads on risky assets such as emerging-market debt and more traditional credit instruments -- a serious monetary tightening could prove devastating for financial markets and increasingly wealth-dependent economies. As long as inflation remains low, however, the authorities can set their sights on the more benign target of neutrality. The latest downside surprise on the US inflation front -- another weaker-than-expected increase in the all-important Employment Cost Index -- provides support for that strategy. Despite a tightening labor market, compensation growth for civilian workers slowed to just 2.8% in the 12 months ending March 2006 -- down one full percentage point from the pace two years ago. This is yet another example of the power of the global labor arbitrage and good reason to believe that central banks can stay focused on the goal of normalization rather than tightening.

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I think Roach underestimates the incompetence of Bushco and the true axis of evil, but hey, I'll cut him some slack. He's simply an economist, soon to join the ranks of "surprised economists". Bushco is playin' for keeps and goin' for the big enchilada - Empire! They want it all!!!

[Ghost Dog]

121. Hmm. Roach the most mainstream of contrarians?

Former bear turns bullish on global economy
http://news.ft.com/cms/s/2ca9fd04-d936-11da-8b06-0000779e2340.html
By Jennifer Hughes in New York
Published: May 1 2006 18:29 | Last updated: May 1 2006 18:29

The world economy may be able to unwind its current imbalances without serious disruption, Stephen Roach, Morgan Stanley’s famously bearish chief economist, predicted on Monday, in a remarkable revision to several years of gloomy prognosis.

Mr Roach had long warned that the US current account deficit and Asian central banks’ ballooning currency reserves risked destabilising the global financial system.

But on Monday, in a note to clients, he said: “I must confess that I am now feeling better about the prognosis for the world economy for the first time in ages.” His comments came as the dollar hit a one-year low against the euro and seven-month low against the yen, as investors remained confident the US Federal Reserve was nearing the end of its interest-rate-tightening cycle.

/more FT comment...

[54anickel]

122. Bwahahaha! They took that piece as BULLISH?!?!? Wow, I guess if

you're no longer all doom and gloom and hold a wee bit more hope you're suddenly a raging bull!!!

I took it more as no longer seeing impending doom, "we're all gonna die" changed to a 50-50 chance of surviving the wreck if we aren't lucky enough to make that 5% chance of a soft landing.

[54anickel]

114. Nickel Slots (Hussman)

http://www.hussmanfunds.com/wmc/wmc060501.htm

snip>

At present, it makes sense to walk away from exposure to broad stock market fluctuations, for reasons including valuation, persistent distribution, internal dispersion, hostile interest rate pressures, inflation and other trends. All of these are covered in substantial detail in recent updates, so suffice it to say that none of these conditions have improved here.

It's important to recognize that our presently hedged investment position is based on the average return/risk profile that has typically accompanied conditions like we see at present. Still, to say that market conditions warrant a full hedge is certainly not to rule out the potential for a market advance. Rather, it is to say that on average, the return that an investor can expect from current conditions is not adequate compensation for the risk involved.

Suppose, for example, that there was a certain casino where the slot machines were “loose” enough during the week that they actually produced a positive average payoff. But say that on the weekends, they were tightened enough that patrons would generally walk out with less money than they walked in with. Given that knowledge, it would make sense to play the slots during the week, but to just avoid them on weekends.

If you were to visit on a weekend, however, you'd inevitably see a certain number of people winning, and possibly winning substantial amounts. While that observation might encourage a novice to play, in hopes of hitting a jackpot, the key fact would remain that the victories one observes on the weekends a) can't be predicted, and b) are outweighed, on average, by losses.

A good gambler in this case would be one who played the slots during the week, and ignored them on the weekends, despite the fact that there were occasionally a few winners on the weekends.

The same is true with an unfavorable Market Climate. The fact is that broad market risk is presently not likely to produce an acceptable return/risk profile, on average. But nothing in this prevents the market from enjoying periodic rallies, some even to marginal new highs.

more...

[54anickel]

115. As GM Goes, So Goes the Nation (Gross)

http://www.pimco.com/LeftNav/Late+Breaking+Commentary/IO/2006/IO+May+2006.htm

I’m not going to affirm the old saw about what’s good for General Motors is good for the nation, or even turn it on its head and suggest that what’s bad for General Motors is bad for the nation. Mainstreet Americans know that the auto industry in terms of its dominance of U.S. economic activity is not what it once was. They also know that the industry is under siege from foreign competition and that a series of mistakes made over several decades by both management and labor have compounded the predicament. But the U.S. economy for better or worse, now stands on service and finance, as opposed to manufacturing legs. “What’s good for Microsoft or Citigroup” would probably be a better fit for the modern day version of Charles Wilson’s metaphor even though Gates or Prince would never acknowledge it.

But as an entropic symbol of U.S. manufacturing aside, I think it important to recognize that General Motors is a canary in this country’s economic coal mine; a forerunner for what’s to come for the broader economy. Their mistakes have resembled this nation’s mistakes; their problems will be our future problems. GM commands the headlines today, but as General Motors goes, so goes the nation. Following their progress over the next few months and years will be like getting a 2010 Wall Street Journal in June of 2006. But rather than describe in detail every similarity of General Motors and the U.S. economy, I invite you to digest the following schematic for its rather frightening similarities and possible future consequences. I will sum up my own conclusions in the paragraphs to follow.

If the U.S. and General Motors have similar flaws and indeed symbiotic fates, they appear to be conjoined primarily by the uncompetitiveness of their existing labor cost structures and the onerous burden of their future healthcare and pension liabilities. That is not to say that other automobile manufacturers or countries don’t share similar characteristics: they do – but GM and the U.S. are compared here because of their historical dominance and therefore the influence that they will have on investment markets as they struggle to adjust. If GM is a canary, let’s hope for the canary’s long life, but be mindful of its chirping deep in the mineshaft of future events that speak to broader implications for the U.S. economy.

Because diminished labor cost competitiveness and excessive future unreserved liabilities are descriptive of both GM and the U.S. economy, GM’s efforts to survive and ultimately prosper should be our own as well. Although the following graphic contains my own assumptions, I am struck by several primary investment conclusions:

1. The current attempt on the part of GM to address the high cost of its labor draws a comparison to potential future U.S. efforts to do so via currency devaluation. While a company must deal directly with its employees and or its unions in order to lower wage/benefit expenses, a country – certainly a capitalistic oriented one – goes about it in another way. By depreciating the dollar, U.S. Treasury or Federal Reserve policies aimed in that direction explicitly do the same thing. Such policies make our products cheaper to buy than those of competitor nations. In terms of global purchasing power experienced by America citizens, a significantly lower dollar in turn leads to declining real wages which is the ultimate consequence in order to restore competitiveness. My point is that the survival tactics employed by General Motors in the form of contract renegotiations (the heavy lifting of which is now being expressed via its parts supplier Delphi in bankruptcy court) will likely be replicated at some point via U.S. economic policies emanating from the U.S. Treasury and Federal Reserve. Look for an eventual abandonment of our stated mantra of a “strong dollar policy” for something more elusive but nonetheless potently obvious. Look also for the Fed to support such a policy – not openly or in public statements – but via a substantive period of low real interest rates compared to history. This one-two punch by the Treasury and the Federal Reserve amounts to what is known in economic circles as a competitive devaluation, a maneuver that may or may not be welcomed by competitor nations with mercantilistic intentions of their own. Nonetheless, at some point in America’s future, a rather drastic rebalancing of wage rates compared to primarily Asian competitors will be required and these are the policies that accomplish that.

more...

[Ghost Dog]

116. US stocks end down on CNBC Bernanke remarks report

http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060501:MTFH14863_2006-05-01_20-09-25_N01180705&symbol=.DJI&rpc=44
Mon May 1, 2006 4:09 PM ET

(Updates to 4 p.m.)

NEW YORK, May 1 (Reuters) - U.S. stocks fell on Monday, erasing earlier gains just before the close after CNBC television reported that Federal Reserve Chairman Ben Bernanke had said over the weekend that economic data will dictate the Fed's future action on interest rates.

Based on latest available data, the Dow Jones industrial average <.DJI> was off 23.85 points, or 0.21 percent, at 11,343.29. The Standard & Poor's 500 Index <.SPX> was down 5.42 points, or 0.41 percent, at 1,305.19. The Nasdaq Composite Index <.IXIC> was down 17.78 points, or 0.77 percent, at 2,304.79.

[UpInArms]

119. closing numbers and blather

Dow 11,343.29 -23.85 (-0.21%)
Nasdaq 2,304.79 -17.78 (-0.77%)
S&P 500 1,305.18 -5.43 (-0.41%)
10-Yr Bond 5.131 +0.62 (+1.22%)

NYSE Volume 2,385,904,000
Nasdaq Volume 2,123,161,000

Stocks closed lower Monday after CNBC reported that Fed Chairman Bernanke said the media misunderstood his congressional testimony last week.

Before the market opened, however, investors found some comfort after Wal-Mart (WMT 45.96 +0.93) reported a preliminary 6.8% rise in April same-store sales. That growth exceeded prior forecasts of 4-6% growth and set the stage for a plethora of retailers expected to report strong monthly figures later in the week. Also suggesting that high gas prices still aren't slowing down the consumer was a larger than expected 0.6% increase in March personal spending accompanied by the biggest increase (+0.8%) in personal income since September. The March core PCE deflator -- the Fed's primary inflation indicator, though, rose 0.3%. That was the largest increase since October and pushed the year-over-year increase to 2.0% from 1.8%, raising worries about mounting inflationary pressures.

More incoming economic data showed that overall construction activity had yet to slow down and that national manufacturing activity remains robust, exacerbating early nervousness among bond traders that initially failed to pour over into the equity markets since the reports only represented one month of data and reflected underlying economic strength. Nevertheless, renewed uncertainty over Fed policy going into the close, fueled by CNBC reporting that Bernanke said the market should see him as being "flexible, not dovish," lent some credence to our skeptical view about further tightening and that there is still no clear end in sight to the uptrend in interest rates.

Like we mentioned last week, we believe the market got too excited by Bernanke's testimony for the simple reason that a "pause" implies that there will be a subsequent rate hike. When it was all said and done Monday, the yield on the 10-yr note (-20/32) was near 4-year highs at 5.137%, weighing heavily on overall sentiment, especially the influential Financial sector. Without leadership from the rate-sensitive Financials, further consolidation in Technology, and the only significant buying support coming from two less influential sectors -- Energy and Materials -- that were also buoyed by rising commodities prices, concerns which play into our Neutral market view, the indices were unable to hold onto modest intraday gains. BTK -1.4% DJ30 -23.85 DJTA +0.1% DJUA -0.9% DOT -0.4% NASDAQ -17.78 NQ100 -0.8% R2K -0.4% SOX -1.0% SP400 +0.2% SP500 -5.42 XOI +1.5% NASDAQ Dec/Adv/Vol 1903/1139/2.09 bln NYSE Dec/Adv/Vol 1788/1469/1.73 bln