STOCK MARKET WATCH, Tuesday 23 May

[ozymandius]

Tuesday May 23, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 974 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 1977 DAYS
WHERE'S OSAMA BIN-LADEN? 1677 DAYS
DAYS SINCE ENRON COLLAPSE = 1638
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 May 22, 2006

Dow... 11,125.33 -18.73 (-0.17%)
Nasdaq... 2,172.86 -21.02 (-0.96%)
S&P 500... 1,262.07 -4.96 (-0.39%)
Gold future... 657.70 +0.20 (+0.03%)
30-Year Bond 5.13% -0.01 (-0.12%)
10-Yr Bond... 5.04% -0.02 (-0.36%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Rob Kirby

MIRROR, MIRROR... ON THE WALL

This time last week the price of gold was on the receiving end of a bone-jarring tumble from a lofty perch, north of 700.00 per ounce, while the price of silver was ambushed from $14.00+ to its current (at the time of writing) “low” 12.00 handle. This type of precipitous decline in the precious metals arena has become all too familiar.

These knee jerk moves are explained by pundits of all stripes serving up everything from the “pabulum” of CNBC in the mainstream to “biting commentary” of contrarian’s cult figures like icons Marc Faber and Jim Puplava. There are also the gold bugs – they explain the gravity-defying miraculous moves in precious metals prices in terms of ill-doings or conspiracy on the part of monetary officialdom.

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I concur with Marc Faber’s genius – however, if we examine his text more closely – he did mention that such an occurrence might take place over a period of three to six MONTHS, not three to six hours or days! Also, if one reads the complete article – they would also notice that in the same breath Mr. Faber predicted higher interest rates:

"I'm a believer that interest rates in the U.S. are far too low," he said.

Well folks, while the price of gold was plummeting last week – 10 yr. bond rates dropped twenty basis points. A paradox perhaps?

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

[ozymandius]

2. Oil surges above $70, hurricane fears support

LONDON (Reuters) - Oil surged above $70 on Tuesday as commodities staged a modest recovery from last week's sell-off, Venezuela mooted OPEC oil production cuts and the U.S. government predicted another rough Atlantic hurricane season.

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"Predictions for a strong hurricane season have been around for a while, but there are some firm numbers and probabilities attached now," said Andrew Harrington, resources analyst at Australia and New Zealand Bank (ANZ) in Sydney.

"If they come to pass it looks like a rough season, which could impact output still recovering from last year."

The U.S. National Oceanic and Atmospheric Administration said 2006 could see up to 10 hurricanes. Last year's weather onslaught on the oil and gas production hub of the Gulf of Mexico saw offshore platforms toppled, undersea pipelines ruptured and several coastal refineries flooded.

more

[ozymandius]

3. Saudi, Conoco to sign refinery deal: sources

RIYADH (Reuters) - Saudi Aramco and U.S. oil firm ConocoPhillips are expected to sign a deal on Wednesday for a second new refinery in the Gulf state, industry sources said on Tuesday.

-cut-

The state oil firm on Sunday signed a deal with France's Total to build a 400,000-barrel-per-day (bpd), export-oriented refinery in Jubail on the kingdom's Gulf coast.

Aramco officials have said they hope to sign a memorandum of understanding with ConocoPhillips for another 400,000 bpd refinery in Yanbu on the Red Sea coast by the end of May.

Al Watan daily said the Yanbu project would be similar to that of Jubail, due for completion in 2011 and with 30 percent of the project being offered to the Saudi public in the future.

more

[ozymandius]

4. Feds: No evidence post-Katrina gas prices were manipulated

Washington -- Federal investigators reported Monday that they could find no evidence that gasoline prices across the country were manipulated or that oil companies colluded in the wake of Hurricane Katrina late last summer.

In a longer-range finding, the Federal Trade Commission also found that over the last 20 years refiners didn't seek to manipulate prices by cutting the number of operating refineries or limiting increases in capacity.

The findings, which support longtime contentions by the oil industry that higher gas prices are purely a function of supply and demand in an increasingly global market, will be small comfort to Americans still angry over gas prices of more than $3 a gallon. It isn't clear how the study will affect Congress, where a variety of proposals to launch new investigations of alleged gas price gouging and to boost taxes on the oil industry's record profits are under consideration.

-cut-

The Federal Trade Commission also warned Congress that new price gouging legislation, which passed the House overwhelmingly two weeks ago, could end up hurting consumers. First, officials of the commission said an exact and meaningful definition of gouging remains elusive. And, they added, "that if natural price signals are distorted by price controls, consumers ultimately might be worse off, as gasoline shortages could result.''

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/05/22/MNGJFJ04215.DTL

Yeah, right. I suppose $3.60 for regular before the storm hit was justified.

[acmejack]

16. Cynic!

[UpInArms]

27. Shell Misses Nigeria Deadline for Payment of $1.5 Billion for pollution

http://news.yahoo.com/s/ap/20060522/ap_on_bi_ge/nigeria_shell_compensation

LAGOS, Nigeria - Royal Dutch Shell PLC skipped a Nigerian court deadline Monday to pay $1.5 billion as compensation for alleged environmental pollution in the country's oil-rich Niger Delta, choosing instead to wait for an appeal court ruling.

A federal court in the country's main oil industry center of Port Harcourt on Friday gave Shell until noon Monday to make the payment to a group of delta communities.

"It will not be appropriate to make the payment since we had appealed against the decision," said Bisi Ojediran, Shell spokesman in Lagos. The company will wait for the higher court ruling before making a payment, he said.

In February, the court ordered Shell to compensate the ethnic Ijaw communities for environmental problems caused by oil operations it runs in collaboration with the Nigerian government, France's Total and Italy's ENI. The joint venture produces a little under half of Nigeria's 2.5 million barrels daily of oil exports.

The Nigerian parliament first ordered the payment in August 2004 in response to a petition sent to it by the communities from the Ijaw group.

...more...

[UpInArms]

49. July Crude @ $71.30 bbl - June Unl Gas @ $2.105 gal - NatGas @ $6.41

10:10 AM ET 5/23/06 JULY CRUDE UP $1.34, OR 1.9%, AT $71.30/BRL IN EARLY TRADING

10:10 AM ET 5/23/06 JUNE NATURAL GAS UP 13.4 CENTS, OR 2.1%, AT $6.41/MLN BTUS

10:10 AM ET 5/23/06 JUNE UNLEADED GAS CLIMBS 4.76 CENTS, OR 2.3%, TO $2.105/GAL

[UpInArms]

72. June Crude @ $71.40 - June NatGas @ $6.17 mln btus

12:35 PM ET 5/23/06 JULY CRUDE TAPS $71.70/BRL, ITS HIGHEST LEVEL SINCE MAY 12

12:35 PM ET 5/23/06 JULY CRUDE LAST AT $71.40/BRL, UP $1.44, OR 2.1%

12:35 PM ET 5/23/06 JUNE NATURAL GAS FALLS 10.6 CENTS, OR 1.7%, TO $6.17/MLN BTU

[UpInArms]

74. July Crude @ $71.90 bbl

1:22 PM ET 5/23/06 JULY CRUDE LAST UP $1.94 AT $71.90/BRL AFTER A HIGH OF $72

[UpInArms]

85. July Crude closes @ $71.76 bbl - June NatGas @ $6.258 mln btus

2:50 PM ET 5/23/06 JUNE NATURAL GAS FALLS 1.8 CENTS TO CLOSE AT $6.258/MLN BTUS

2:50 PM ET 5/23/06 JULY CRUDE CLOSES AT ITS HIGHEST LEVEL SINCE MAY 12

2:50 PM ET 5/23/06 JULY CRUDE UP $1.80, OR 2.6%, TO CLOSE AT $71.76/BRL

[genieroze]

94. rough Atlantic hurricane season? I thought the weather specialists said

it's going to be a mild season.

[ozymandius]

5. OECD says Fed needs to raise rates a bit more

PARIS (Reuters) - The OECD called on Tuesday for the Federal Reserve to tighten interest rates a bit more as it projected U.S. economic expansion was set to stay solid this year before easing slightly in 2007.

"A light 'tap on the brakes' seems necessary to keep the economy in balance," the Paris-based Organization for Economic Cooperation and Development said in its half-yearly Economic Outlook report.

It raised its projection for U.S. GDP growth to 3.6 percent in 2006 from the 3.5 percent it forecast in November. Core inflation was seen at 3.0 percent for the year.

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But next year it said falling core inflation and rising unemployment would permit "a slight relaxation of monetary policy."

more

[ozymandius]

6. US economy to grow 3.6 percent in 2006: OECD

PARIS (AFP) - The US economy is set to grow by a robust 3.6 percent in 2006, but the
Federal Reserve should increase interest rates, the OECD said as it issued a stern warning about high deficits, deep trade imbalances and low savings.

The American economy weathered Hurricane Katrina and has absorbed oil price shocks but is now at risk of overheating, the Paris-based Organization for Economic Cooperation and Development said in its twice-yearly review of the world economy.

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The report described current account imbalances in the US -- which the OECD predicted could reach 7.5 perent of GDP in 2007 -- as "unsustainable," adding that "most observers agree that ... a rebalancing looks increasingly unavoidable."

Such a correction could entail a further depreciation of the already weakened dollar, on the order of one-third to one-half, the report said, citing experts.

more

[Roland99]

11. Overexaggerate Economy Compulsive Disorder?

[AnneD]

47. Morning Marketeers,

:donut: and lurkers. And here all this time I thought Bush suffered from ADD. But since you mentioned it-he has presented with the symptoms as of late. I think Sec. Snow is terminal.

Well, I hear Fannie Mae will restate earning, that should be fun. And all this timing of options by CEO's...it just reinforces my theory that there are High Roller game rooms on the upper floors and we are not invited in.

Roland...did you catch some of the comments about Barbaro after his surgery. They were saying he was 'frisky' toward some of the fillies.:rofl: That is SOOOOO male. A 50/50 chance of dieing, leg busted up, post surgery....and all he has his mind on messing around and shattering the other bone in the process. I'll wager he stands a better than 50/50 chance of survival. I sure hate to see a fine horse put down. You would think they would have had more medical advancements in this field by now. These horses are insured out the wa zoo so there is a great temptation to take the money and cut your losses. I respect the owners for giving Barbaro a chance.

Happy hunting and watch out for the bears.

[Roland99]

48. Yeah, the horse racing industry is a tough one on the horses *and* jockeys

There was an EXCELLENT HBO documentary on jockeys a couple years ago. I believe it focused on Churchill and on one jockey in particular suffering various physical problems from years and years of purging to maintain his weight and how jockeys don't get much support, healthcare-wise.

Barbaro is being a typical young male, and showing he's already ready for the stud farm. Ol' horndog he is.


As for the CEO options, have there been some articles I've missed? If CEOs are cashing in on options, perhaps they feel the market has topped out?

[AnneD]

51. Believe it or not....

I saw that HBO special. Makes you appreciate Willie Schumaker's accomplishments even more. I will post an article on option timing at the bottom of the thread.

[Roland99]

69. Update: Barbaro walking on leg, improving after surgery

http://sportsillustrated.cnn.com/2006/more/05/23/bc.rac.barbaro.sfuture.ap/index.html?cnn=yes

KENNETT SQUARE, Pa. (AP) -- There was more good news Tuesday on Barbaro's recovery from a catastrophic injury to his right hind leg.

"He's actually better today than he was even yesterday and he was pretty good yesterday," Dr. Dean Richardson said. "He's walking very well on the limb, absolutely normal vital signs. He's doing very well."

Barbaro was on his feet in his stall, even scratching his left ear with his left hind leg just two days after Richardson and a team of assistants spent more than five hours pinning together the leg bones he shattered in the Preakness Stakes on Saturday.

The surgery was performed at the George D. Widener Hospital for Large Animals at the University of Pennsylvania's New Bolton Center.

cool beans!

[AnneD]

73. Better than....

50/50. Looking good.

[ozymandius]

7. Tokyo shares continue decline on global slump

The Japanese stock market was pushed down on Tuesday by a combination of weakness in both export-focused and domestic sectors. The Nikkei 225 closed 1.6 per cent lower at 15,599.20. The Topix was 2.3 per cent lower at Y1,579.26, hit in particular by falls in banking stocks, which have a high weighting in the index.

Japanese shares continued to suffer from the global flight from equities, which pushed virtually every sector lower.

Some stocks with a particularly high exposure to the US market were badly hit, given fears about the US economy.

The transport equipment sector, which is heavily reliant on the US for sales, fell a touch faster than the Topix. Toyota (NYSE:TM - news), Japan's biggest carmaker, was down 1.8 per cent to Y5,950.

more

[ozymandius]

8. London mining stocks lead FTSE rally

Strong earnings and rallying resource stocks helped London equities markets reclaim some of their recent losses on Tuesday as investors ignored weakness in Asia and New York overnight.

The focus was on upbeat results from the likes of British Land Co and Yell Group while mining groups and oil companies, which formed the greatest weight behind recent losses, rallied strongly.

The FTSE 100 was 70.5 points, 1.3 per cent higher at 5,603.2 in early trade, bouncing back strongly from the five month lows seen in the previous session, while the mid-cap FTSE 250 was also higher, up 247 points, or 2.8 per cent to 9,075.6.

Overnight in New York, the S&P 500 was down 0.4 per cent, or 4.96 points, to 1,262.07, at one point in the session dipping into negative territory for the year, while the Nasdaq Composite lost 1 per cent, or 21.02 points, to 2,172.86. The Dow Jones Industrial Average was down 0.2 per cent, or 18.73 points, at 11,125.33.

more

[ozymandius]

9. Euronext Rebuffs Bid From Deutsche Boerse

AMSTERDAM, Netherlands - European stock-exchange operator Euronext rebuffed an $11 billion takeover proposal from Deutsche Boerse on Tuesday, calling new details of the bid misleading and saying the $10.2 billion offer by the New York Stock Exchange remained more attractive.

In a statement ahead of Euronext NV's shareholder meeting, Chief Financial Officer Serge Harry said that more specifics of the bid by Deutsche Boerse AG released Tuesday had not changed the company's mind.

Euronext, which runs the Paris, Brussels, Amsterdam and Lisbon exchanges, sits at the center of the current battle for stock market consolidation after the Nasdaq Stock Market Inc. acquired 25 percent of the London Stock Exchange PLC.

The company said Monday that the NYSE Group Inc.'s cash-and-share bid was the "most attractive combination" on the table, but stressed that it would present both proposals to shareholders Tuesday, and will not formally recommend a deal until it has heard their views.

more

[ozymandius]

10. Stock purchases not fully lawful, he admits (Ken Lay)

HOUSTON -- Former Enron Corp. Chairman Kenneth Lay testified Monday that he did not comply with federal law when he bought stock with loans that were not approved for that purpose, while jurors in his separate fraud trial deliberated for a third day.

Lay told U.S. District Judge Sim Lake he was not "in compliance" with federal laws barring the use of some loans to buy publicly traded stock, though he said he was not trying to mislead the banks by mishandling some of the $75 million he borrowed. The government contends he made false statements to the banks and engaged in fraud in his handling of the credit lines.

"There's no doubt we did not fully comply with the provisions of" loan documents barring the use of some of the money to buy stock, Lay said in the non-jury bank fraud case. "It was not my intent" to defraud the banks, he said.

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Prosecutors contend Lay violated Regulation U, part of a package of Depression-era laws meant to guard against reckless investing in shares, such as buying them on credit and using stock as collateral.

http://www.chicagotribune.com/business/chi-0605230244may23,1,4589512.story?coll=chi-business-hed

[54anickel]

12. Heh-heh, Snow's gonna give a little talk today on financial literacy...

This ought to be good.

http://money.cnn.com/2006/05/23/markets/stockswatch/index.htm
Futures hint to end of bloodletting
Stock futures point higher even as oil climbs over the $70 a barrel benchmark once again.

snip>
Major markets in Asia closed lower Tuesday, although major European markets were up in early trading. Pan-European exchange operator Euronext, which is holding its shareholder meeting Tuesday, stuck by its support for a $10 billion bid for the exchange by the NYSE Group (Research), in the face of a Deutsche Boerse bid which it said is offering $11 billion.

Treasury prices were little changed, leaving the yield on the benchmark 10-year note near the 5.04 percent level reached late Monday. The dollar was higher against the euro but lower against the yen.

Federal Reserve Chairman Bernanke, Treasury Secretary John Snow and Securities and Exchange Commission Chairman Christopher Cox are due to testify before the Senate Banking Committee on the topic of improving financial literacy. But they could face questions about their outlook for inflation and economic growth. Concerns about those topics have weighed on markets for the last week.

snip>

The Wall Street Journal reported that mortgage financier Fannie Mae (Research) is expected to announce it has agreed to pay a fine of about $400 million for allegedly manipulating accounting rules in ways that helped increase bonuses for executives.

[54anickel]

13. Fed Wonders Will Summer '06 Resemble Winter '95

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_berry&sid=av31ZBfjeswM

May 23 (Bloomberg) -- One question some Federal Reserve officials probably are pondering is, how much will the summer of '06 be like the winter of '95.

In February 1995, after a year of strong economic growth, falling unemployment, soaring commodity prices and significant interest rate increases, Fed Chairman Alan Greenspan told his colleagues there were tentative signs ``of slight cracks along the road.'' To make sure they widened and growth slowed, he argued successfully for a further 50 basis point jump in the Fed's overnight lending rate target.

A scant four months later, Greenspan, appearing on a panel of central bank governors in Seattle, told the world he was satisfied that the U.S. had escaped the danger of a ``serious'' recession.

The issue at that February meeting is essentially the same one that will confront the Federal Open Market Committee at its meeting late next month: whether to pause in raising rates while waiting to see how much the economy slows, or to continue increasing rates to be sure inflation remains under control.

One official who surely has 1995 in mind is Janet L. Yellen, president of the San Francisco Federal Reserve Bank, a voting member of the FOMC this year. Eleven years ago Yellen was a member of the Fed Board, and at that February meeting she joined then Fed Vice Chairman Alan Blinder in trying to persuade Greenspan to wait for more data.

more...

[54anickel]

14. New index offers window on to US housing market

http://news.ft.com/cms/s/3fe36c7a-e9b7-11da-a33b-0000779e2340.html

Economists were provided with a new tool to assess the cooling US housing market on Monday with the launch by the Chicago Mercantile Exchange of futures and options tied to changes in residential real-estate prices.

The prolonged boom in house prices, alongside the rise of more complex mortgage products, has raised concerns about the severity of the emerging slowdown and its impact on consumer spending.

The CME hopes to attract institutional clients such as builders and mortgage investors seeking to manage their exposure to an asset class which grew to $21600bn last year, larger than the US equity market and approaching the scale of outstanding corporate bonds.

snip>

Robert Shiller, Yale economist and expert in behavioural finance who helped develop the measure, has also been one of the leading bears on the housing market.

While some economists argue it still fails to capture regional differences and the impact of items such as home improvements, proponents claimed it does provide an accurate assessment of the broader market. “This is probably as good as it gets,” said Russell Andersson, co-founder of HedgeStreet, which launched its own housing derivatives 18 months ago.

more...

[54anickel]

15. Cash becoming king as all else fails

http://today.reuters.com/news/newsArticle.aspx?type=reutersEdge&storyID=2006-05-22T152045Z_01_L22462111_RTRUKOC_0_US-MARKETS-INVESTORS-CASH.xml

LONDON (Reuters) - It's a problem for investors when equities tumble on worries about inflation and higher interest rates. Where are they going to put their money -- bonds?

Cash has suddenly become a hot item as previously high-flying assets such as stocks, emerging market debt and commodities have suffered in a harsh global sell-off.

Major government bonds, which would normally attract safe-haven flows as riskier assets struggled, have become a bit more popular. But the specter of inflation and tighter monetary policy hovering overhead has made it a cool embrace at best.

snip>

"There is definitely a flight to quality on the cash side," said Rajeev De Mello, head of Asian fixed income for Pictet Asset Management. "The moves in government bonds haven't been as remarkable as they could be."

snip>

Although taken slightly before the current stock market sell off, Merrill Lynch's latest monthly poll of fund managers showed investors moving into cash. Most held neutral stances but of those answering nearly 40 percent were positioned overweight.

A range of leading investors, meanwhile, are taking long cash positions or recommending their clients to do so. Lehman Brothers' private investment group told its wealthy clients last week to go overweight in cash.

more...

[54anickel]

17. Textbook Warnings (Hussman)

http://www.hussmanfunds.com/wmc/wmc060522.htm

snip>

Among the simplest truths is that market risk tends to be unusually rewarding when market valuations are low and interest rates are falling. For example, since 1950, the S&P 500 has enjoyed total returns averaging 33.18% annually during periods when the S&P 500 price/peak earnings ratio was below 15 and both 3-month T-bill yields and 10-year Treasury yields were below their levels of 6 months earlier. Needless to say, there are a variety of ways to refine this result based on the quality of other market internals, but it's a very useful fact in itself.

The “canonical” market bottom typically features below-average valuations, falling interest rates, new lows in some major indices on diminished trading volume, coupled with a failure of other measures to confirm the new lows, and finally, a quick high-volume reversal in breadth (usually with an explosion of advances over declines very early into a new advance).

Similarly, market risk tends to be poorly rewarded when market valuations are rich and interest rates are rising. Since 1950, the S&P 500 has achieved total returns averaging just 3.50% annually during periods when the S&P 500 price/peak earnings ratio was above 15 and both 3-month T-bill yields and 10-year Treasury yields were above their levels of 6 months earlier. Again, there are a variety of ways to refine this result, but note that anytime the total return on the S&P 500 is less than risk-free interest rates, a hedged investment position increases overall returns (since hedging instruments are priced to include implied interest).

The “canonical” market peak typically features rich valuations, rising interest rates, often a reasonably extended and “flattish” period where, despite marginal new highs, momentum has gradually faded while internal divergences have widened, and finally, an abrupt reversal in leadership, from a preponderance of new highs over new lows (both generally large in number) to a preponderance of new lows over new highs, with the reversal often occurring over a period of just a week or two.

Though our investment position doesn't by any means rely on it, my impression is that recent market conditions fall very much into that description of a canonical peak.

more...

[54anickel]

18. What's Behind the Global Stock Market Melt-down?

Rather long with lots of charts

http://www.321gold.com/editorials/sirchartsalot/dorsch052306.html

Do you believe in conspiracy theories? Sometimes they are difficult to refute. Such was the case last week, just after the Euro had soared towards a 12-month high of $1.30, and the British pound, itself ridden with large trade and budget deficits, stood mighty tall at $1.90, with traders setting their sights for $2 for the pound. The US dollar lost 7% in just six weeks against America's main trading partners, and was 28% lower since January 2002, to stand just 1% above its 1995 low.

Then on Sunday May 14th, currency traders in London, picked up an obscure report from the UK's Observer newspaper, that indicated the International Monetary Fund was in behind-the-scenes talks with the EU, Japan, the US, China and other major powers to arrange a series of top-level meetings to tackle imbalances in the global economy, and address the dollar sell-off that was rattling global stock markets.

Fearing a surprise rescue package for the US dollar, London currency traders began to lock in profits from the Euro's six week old rally to just shy of $1.30. As always, the first line of defense in the currency market is jawboning, and finance officials in Europe, Japan, and the US were out in full force, talking the Euro and Japanese yen down, and the US dollar up. Timely jawboning by G-7 finance ministers, helped to keep a lid on the Euro just below $1.30, and rescued the dollar at 109-yen.

G-7 central bankers understand that a weaker US dollar can exert upward pressure on the cost of US imports, which rose 2.1% in April, and account for 17% of Americans purchases. And a sharply higher Euro and Japanese yen against the US dollar, also subtracts from profit margins of European and Japanese exporters, which is unraveling the EuroStoxx-600 and Nikkei-225 stock market rallies. European and Japanese central bankers have worked very hard to inflate their equity markets for the past four years to stimulate consumer demand through the "wealth effect."

G-7 central bankers and finance officials are also alarmed by gold's spectacular surge against all major currencies over the past eight months, a clear signal that global investors have lost confidence in the purchasing power of fiat (paper) currency. A global flight from G-7 government bonds and into gold since September 2005, has lifted bond yields to multi-year highs in Japan and the US, the world's largest debt markets, and in a long delayed reaction, triggered big shake-outs in global stock markets in mid-May.

more...

[Clarkie1]

97. A Good Buying Opportunity is Developing in the Stock Market.

Look for the S & P to trade in the mid-1300s by year end. I'm glad to see this current short-term correction in the market. It was long overdue and very healthy.

[UpInArms]

19. daily dollar watch

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

Last trade 84.42 Change +0.03 (+0.04%)

Snow Sparks Dollar Bearish Momentum

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Snow_Sparks_Dollar_Bearish_Momentum_1148335199716.html

Dollar strength was limited on the day with most of the majors making some headway from Friday’s pullback. With no economic data, the fluctuations were restrained to the current consolidation as comments from US Treasury Secretary Snow helped spark the day’s dollar weakness. Speaking in Sharm el Sheik, Egypt at an interview yesterday, Secretary Snow noted that the cash windfall from Middle Eastern oil producers is likely to lead to improved school conditions and roads in the region and not further investments in US assets. Already with crude oil prices climbing 40 percent higher on the year, oil producers have increased their holdings of US treasuries, notes and bonds. The amount has grown phenomenally with members of the Organization of Petroleum Exporting Countries increasing their holdings by 158 percent in the past three years. Although the Treasury Secretary went on to note that global foreign interest remains underpinned and that the market is so “huge that the sums” would “pale compared to the size of that capital market” traders took to paring back dollar positions. Ultimately, with interest thinned concerns are surfacing that the twin deficits may further weigh on the overall currency market. Looking ahead, with no releases on the session, traders will be privy to the still nascent Richmond index in dictating tomorrow’s direction. Should the report print higher than the expected 15 reading, speculation could resurface of further rate hike considerations.

...more...

US Dollar Reverts To Weakness

http://www.dailyfx.com/story/dailyfx_reports/daily_technicals/US_Dollar_Reverts_To_Weakness_1148379748067.html

EUR/USD – Once again, EUR/USD dipped below 1.2700 ever so briefly before an impressive rally to 1.2886. The rally to that level appears far more convincing than the previous rally to 1.2872 and as such, the market may be leaning towards a bullish stance once again – signaling that the corrective 4th wave on the daily charts from 1.2970 is nearing an end or may already be in place at 1.2691. Support is at the 61.8% and 78.6% fibos of 1.2691-1.2886 at 1.2766 and 1.2733. A break below 1.2691 would argue for a retracement towards the 5/4 low / 38.2% fibo of 1.1825-1.2970 at 1.2532/70.

<snip>

USD/JPY – USD/JPY made a very bearish reverse hammer yesterday at the 38.2% fibo of 118.87-108.98 at 112.75 and has since tested the 111.00 figure (actually stopping at the 50% fibo of 108.97-112.93 at 110.95). The bearish candle on the daily combined with the fibo level at 112.75 is compelling evidence that the path of least resistance is down for the time being. Immediate resistance is at the 50% fibo of 112.98-110.96 at 111.94. Another leg down could test the 5/18 low at 110.29 with the next support level at the 5/12 low of 109.29. Hourly oscillators are decreasing and MACD < 0.

<snip>

USD/CAD – Yesterday’s observation that “corrections often take this form or count of 3-3-5. This would be suggestive of a reversion to weakness” proved correct as USD/CAD dropped 80 pips open to close. The ensuing fall was one that a trader did not want to be in the way of. The pair is supported by the confluence of the 10 and 20 day SMA’s at 1.1115/18 but a break through there exposes the 5/18 low of 1.1096. This evening’s 1.1175 high is initial resistance but former intraday support at 1.1193 must hold at resistance if we are to see more action to the downside.

...more...

[UpInArms]

33. Dollar mixed ahead of Bernanke

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B241E4825%2DD945%2D4480%2D818A%2D9528C08E690C%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) - The dollar traded mixed against major foreign-exchange counterparts early Tuesday with investors awaiting Federal Reserve Chairman Ben Bernanke and Treasury Secretary John Snow's testimony on financial literacy at the Senate Banking Committee at 10 a.m. The yen saw gains after Bank of Japan Governor Toshihiko Fukui said the central bank "will slowly adjust interest rates while guarding against the risks of excessive monetary easing" and following news that S&P upgraded its outlook for Japan to positive from stable. The dollar traded down 0.2% at 111.43 yen, while the euro was down 0.1% at $1.2835.

[UpInArms]

52. Chopper Ben plans for re-education camps

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B489CBE3E%2D7B37%2D4B88%2DABC8%2DD39C04B816C9%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Financial literacy is the cornerstone of better decision making by consumers and smooth functioning of financial markets, said Fed chief Ben Bernanke on Tuesday. "Clearly, to choose wisely from the variety of products and providers available, consumers must have the financial knowledge to navigate today's increasingly complex financial services marketplace," Bernanke said at a Senate Banking panel hearing on consumer education. He vowed to continue the central bank's myriad efforts to educate the public. Bernanke's remarks were echoed by Christopher Cox, the Securities and Exchange Commission chairman, who told the same hearing that "plain English" disclosure and interactive data was needed to allow investors to make their own financial decisions.

Need to learn more doublegood-doublespeak!

[UpInArms]

61. Chopper Ben says "Charge It!"

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T150637Z_01_WAT005626_RTRIDST_0_ECONOMY-BERNANKE-REGULATION-URGENT.XML

WASHINGTON, May 23 (Reuters) - Federal Reserve Chairman Ben Bernanke said on Tuesday that the U.S. central bank had managed to achieve good practice in credit card disclosure with the supervisory tools that it already has in hand.

"We've found that through guidance and supervisory oversight, we've been able to get satisfactory practices from the banks that we supervise," he told the U.S. Senate Banking Committee during testimony on financial literacy.

"Providing disclosures about paying the implications of paying the (monthly credit card payment) minimum is a very important practice and we try to encourage that," he said.

...more...

"we try to encourage that"?

[UpInArms]

62. Chopper Ben admits to poor judgment

11:16 AM ET 5/23/06 BERNANKE SAYS COMMENTS TO CNBC ANCHOR A 'LAPSE OF JUDGMENT'

11:13 AM ET 5/23/06 BERNANKE: REFUSES TO COMMENT ON STOCK DROP SINCE MAY MEETING

[UpInArms]

68. Double-plus Double-Good Speaking Lesson from Chopper Ben

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T154144Z_01_WAT005628_RTRIDST_0_ECONOMY-BERNANKE-MORTGAGES-URGENT.XML

WASHINGTON, May 23 (Reuters) - An expected re-pricing (when those interest rates hit the ARMs) this year of the interest rates charged on many (up to 40%) U.S. mortgages may put pressure on those who borrowed (those suckers) in the sub-prime mortgage market (everyone that had less than 100% on their test score), Federal Reserve Chairman Chopper Ben Bernanke said on Tuesday.

"Our data (and all the manipulations that we apply to that data) are that about 10 percent (and remember this number is massaged also) of all mortgages -- not just adjustable-rate, but of all mortgages -- will re-price in 2006. Something in the order of about 20 to 25 percent of outstanding mortgages are adjustable-rate and something close to half of those will be re-priced (and most of those will become bank foreclosures), we think, within the next year. That is significant obviously for those people (and will impact the lending institutions as they go belly up) who have those mortgages and may be facing higher interest rates," Bernanke said during lawmaker questions at a hearing on financial literacy before the Senate Banking Committee.

"One concern (is that people might notice that we have been blowing this bubble up for a number of years so that we could inflate our economic figures and now the jig is about up) I would note is that adjustable-rate mortgages seem to be more prevalent in the sub-prime market relative to the overall market and so some pressure may be felt in that area," he added.

[UpInArms]

20. CME housing futures debut as bubble deflates

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2006-05-22T224927Z_01_N22414062_RTRIDST_0_FINANCIAL-CME-HOUSING.XML

CHICAGO, May 22 (Reuters) - The Chicago Mercantile Exchange launched its suite of housing futures contracts on Monday, in time for what some see as a full-fledged deflation of the U.S. housing bubble.

The largest U.S. futures exchange has billed its housing derivatives, tied to the S&P/Case-Shiller Home Price Index (CSHPI), as the first financial tools that make it possible to trade fluctuating U.S. real estate values. The CME is owned by Chicago Mercantile Exchange Holdings Inc. <CME.N>, which went public in December 2002.

Some 11 contracts were listed on Monday -- a U.S. composite index and separate readings based on home price trends in Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington.

<snip>

He predicted that many of the CME futures would probably go into backwardation, where prices for deferred contracts would trade below those of nearby contracts.

"We are in a situation where a speculative mentality has appeared and is driving the market," he said. "I think that people will be expecting prices to go down, particularly in the volatile cities, and that will be reflected in the market," Shiller said.

Some of the biggest losses on Monday, versus settlement prices established for Friday, were in deferred Los Angeles, Miami and Washington, D.C., futures. Higher prices were seen for the Denver contract.

...more...

[54anickel]

21. FBI seeks stolen personal data on 26 million vets

Gonzales, VA secretary say no indication of misuse

http://www.cnn.com/2006/US/05/22/vets.data/index.html

WASHINGTON (CNN) -- Federal agents are trying to recover personal data on more than 26 million U.S. veterans after an apparently random burglary at the home of a computer analyst, Veterans Affairs Secretary Jim Nicholson said Monday.

Burglars made off with a computer disc that contained the veterans' names, Social Security numbers and birth dates during a break-in this month at the home of a department data analyst, Nicholson told reporters.

Nicholson and Attorney General Alberto Gonzales said there was no indication that the information has been misused.

The missing data does not include health records or financial information, the department said. It does include some disability ratings and data on some veterans' spouses. (Watch the implications of the security breach -- 2:23)

Nicholson said the analyst has been placed on administrative leave during the investigation but that no "ulterior motive" is suspected. The analyst is a longtime employee of the department but was not authorized to take the information home, he said.

more...

[UpInArms]

22. U.S. OFHEO delays release of Fannie Mae report

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-22T233239Z_01_N22417162_RTRIDST_0_FINANCIAL-FANNIE-OFHEO-URGENT.XML

WASHINGTON, May 22 (Reuters) - The regulator for mortgage finance giant Fannie Mae on Monday delayed the release of its report on the company's multibillion dollar accounting problem due to "logistics."

The Office of Federal Housing Enterprise Oversight will now release the report on Tuesday at 1330 EDT (1730 GMT) rather than 1000 EDT (1400 GMT).

[UpInArms]

23. Fannie to pay $400 Million fine on accounting manipulation: WSJ

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B8EEB562E%2D6917%2D432B%2D972E%2D815A8C3B8549%7D&symbol=

SAN FRANCISCO (MarketWatch) -- A settlement is expected Tuesday between federal regulators and Fannie Mae, in which the home-mortgage financier will pay a fine of about $400 million, according to a media report.

The expected settlement with the Office of Federal Housing Enterprise Oversight and the Securities and Exchange Commission includes the fine for allegedly manipulating accounting rules to help bump up executive bonuses, according to a Wall Street Journal report. See full story (subscription required).

Also Tuesday, Ofheo, Fannie's (FNM : 50.27, +0.39, +0.8% ) federal regulator, is scheduled to release a report about Fannie's bookkeeping missteps. The report is likely to reiterate criticism of management, echoing an earlier independent panel's review of the firm. See full story.

...more...

[UpInArms]

24. Ex-Fannie Mae Accountant Slams Report

http://news.yahoo.com/s/ap/20060522/ap_on_bi_ge/fannie_mae

WASHINGTON - A former Fannie Mae accountant who gave regulators key information in their probe of the mortgage giant says a report commissioned by the company's board paints a false picture of his actions and motives.

The accusations by Roger Barnes came in a letter to former Sen. Warren Rudman, who led the board-ordered investigation into accounting failures at the nation's second-largest financial institution. His team's report in February contended there was a breakdown in financial controls and an arrogant corporate culture at the government-sponsored company that is now struggling to emerge from an $11 billion accounting scandal.

<snip>

The regulators first brought Fannie Mae's accounting improprieties to light in September 2004, accusing the company of earnings manipulation to meet Wall Street targets — disclosures that stunned the financial markets.

The regulators have said that information provided by Barnes, who was a manager in the Controller's Division at Fannie Mae when he left in October 2003, was important to their investigation of the company's accounting.

In a detailed and lengthy letter to Rudman dated Friday, Barnes' attorney said his report unfairly portrayed Barnes as a disgruntled employee, minimized his well-documented allegations of accounting problems, and falsely suggested that he was primarily driven by the belief that he was a victim of racial discrimination.

"Mr. Barnes was motivated only by a strong desire to see Fannie Mae comply with the law, comply with generally accepted accounting principles, and to be honest with its investors and the public about its true financial situation," wrote the attorney, Debra S. Katz. "We request that you correct your report to add the facts and documentary evidence ... and to withdraw your report's conclusions that paint a false and misleading picture of Mr. Barnes' actions and motivation."

...more...

[UpInArms]

34. US regulator to release Fannie Mae report 9:30 EDT

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T124818Z_01_WAT005617_RTRIDST_0_FINANCIAL-FANNIE-OFHEO-URGENT.XML

WASHINGTON, May 23 (Reuters) - Fannie Mae's regulator, the Office of Federal Housing Enterprise Oversight, on Tuesday said it would release findings of its probe into the mortgage finance giant's multibillion-dollar accounting scandal at 9:30 a.m. (1330 GMT), earlier than expected.

[UpInArms]

40. U.S. Treasury to brief on OFHEO Fannie Mae report at 2:30 EST

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T133649Z_01_WAT005619_RTRIDST_0_FINANCIAL-FANNIE-OFHEO-URGENT.XML

WASHINGTON, May 23 (Reuters) - U.S. Treasury Under Secretary Randal Quarles will on Tuesday hold a briefing on a report from Fannie Mae's regulator on the mortgage finance company.

The briefing was set for 2:30 p.m. (1830 GMT)

[UpInArms]

42. OFHEO-Fannie board contributed to accounting woes

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T134636Z_01_WAT005620_RTRIDST_0_FINANCIAL-FANNIE-REPORT-URGENT.XML

WASHINGTON, May 23 (Reuters) - Risks from an accounting scandal at U.S. mortgage finance Fannie Mae were greatly understated, and deliberate smoothing of earnings overstated income by $10.6 billion, its regulator said on Tuesday in a report on the mortgage finance giant's accounting scandal.

The U.S. Office of Federal Housing Enterprise Oversight said Fannie Mae (FNM.N: Quote, Profile, Research) 's board of directors contributed to problems by failing to act independently or gather information.

The regulator found that $52 million of former Chief Executive Franklin Raines' $90 million in compensation was linked to earnings.

[UpInArms]

44. BoDs " contributed to problems by failing to act independently "

Reminds me of our lack of oversight by congress.

And what HUGE problems our country will face from this failure?

More than I can enumerate.

[UpInArms]

56. Ofheo report clear warning about Fannie investments: Quarles

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BFC68B79B%2D36F9%2D4AB3%2D9DA4%2D35E8150B9D85%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- A report criticizing Fannie Mae's (FNM : 50.27, +0.39, +0.8% ) board of directors and management for manipulating the giant company's books demonstrates a clear need for limiting the amount of investments the firm may hold, a top U.S. Treasury official said Tuesday. Undersecretary Randal Quarles said the report by the Office of Federal Housing Enterprise Oversight shows Fannie's low-risk, well-managed image was an "illusion," and called again for tighter laws on the government-sponsored housing enterprise. The Bush administration has warned that the huge holdings of Fannie and Freddie Mac (FRE : 61.20, -0.31, -0.5% ) could endanger the economy if there's a crisis at either company.

We got your "clear warning" right here, buddy boy! Stock in FNM going UP! Hurrah for corruption and lack of oversight! WHEE!

[UpInArms]

60. "arrogant and unethical" corporate culture

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2006-05-23T150219Z_01_N232338_RTRIDST_0_FINANCIAL-FANNIE-UPDATE-3.XML

The 340-page report laid out a litany of accounting problems and failures by Fannie Mae's <FNM.N> management and directors, including current Chief Executive Officer Daniel Mudd.

It said Fannie used its enormous political power in Washington to lobby Congress in an effort to interfere with OFHEO's examination of the company's accounting problems.

OFHEO also said a large number of Fannie's accounting practices and policies did not conform with generally accepted practices. According to the report, Fannie overstated income and capital by about $10.6 billion, in line with the estimates of the company's potential restatement.

"A combination of factors led Fannie Mae senior management, through their actions and inactions, to commit or tolerate a wide variety of unsafe and unsound practices and conditions," the report said.

"Fannie Mae's board of directors contributed to those problems by failing to be sufficiently informed and to act independently of its chairman, Franklin Raines, and senior management, and by failing to exercise the requisite oversight over the enterprise's operations."

[UpInArms]

65. WSJ's Crystal Ball - $400 Million Fine Announced

11:41 AM ET 5/23/06 REGULATORS FINE FANNIE MAE $400 MILLION OVER ACCOUNTING

Can anyone say "inside information"?

I knew you could. :eyes:

[UpInArms]

79. Fannie employees still being probed by SEC, says SEC chief

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B90BFCE38%2D6141%2D43DC%2DAA29%2DCCD25DDE063C%7D&siteid=mktw&dateid=38860%2E5797490625%2D874732680

WASHINGTON (MarketWatch) -- The $400 million fine against mortgage finance giant Fannie Mae announced Tuesday was necessary to correct the "egregiousness" of the firm's management and board in the accounting scandal that rocked the company, Securities and Exchange Commission Chairman Christopher Cox said Tuesday. Cox said the fine should also serve as a warning to other companies whose internal financial controls may be less than adequate. The agency is still investigating the actions of individuals who participated in the accounting fraud, Cox said. Fannie agreed to the fine and said it will work with its federal regulator to correct accounting problems.

[Robbien]

86. Serve as a warning, Warning what? No one is being charged here

The company hands over a little bit of their cash, gets a bit of bad press and gets their hands slapped. Is anything going to come from this "investation of individuals involved"? Not likely.

Then business as usual.

[UpInArms]

84. US OFHEO says years before Fannie meets standards

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T182235Z_01_WBT005428_RTRIDST_0_FINANCIAL-FANNIE-COMPENSATION-URGENT.XML

WASHINGTON, May 23 (Reuters) - Fannie Mae's (FNM.N: Quote, Profile, Research) federal regulator on Tuesday said it could be years before the mortgage finance giant meets standards expected of a financial institution of its size, and those standards will impact when the supervisor lifts limits on the company's investment portfolio.

The acting director of the U.S. Office of Federal Housing Enterprise Oversight also said the agency asked Fannie to pursue the disgorgement of former executives' compensation.

[54anickel]

25. India's stocks recover after largest-ever fall - Police patrol lakes,

Police patrol lakes, canals in India for suicidal brokers following 10 percent stock plunge.

http://money.cnn.com/2006/05/22/news/international/india.reut/index.htm


MUMBAI (Reuters) - Indian police are watching out for possible suicides by brokers and investors after a steep market slide wiped out billions of dollars in share values, officials said on Monday.

Indian shares clawed back to close nearly 4 percent lower on Monday, helped by buying from state-run mutual funds and financial institutions, after the biggest one-day points drop that halted trading for an hour.

The 30-share benchmark BSE index closed provisionally at 10,536.79 points, or 3.67 percent down, its lowest closing since March 9.

The Bombay Stock Exchange Ltd. and National Stock Exchange suspended trading for an hour after the market fell more than 10 percent at one point.

snip>

"I borrowed money to trade in the market. I lost it all in the past two days," said 37-year-old Sanjay Joshi, a small investor. "I don't know how will I repay my loans."

In the 1990s, a stock market meltdown led to several bankrupt brokers and small investors committing suicide across India, some of them drowning in rivers or throwing themselves off highrises.

more...

[UpInArms]

26. Microsoft tells contract workers to take 7 days off (without pay)

http://today.reuters.com/news/newsarticle.aspx?type=businessNews&storyid=2006-05-23T010937Z_01_N22413923_RTRUKOC_0_US-MICROSOFT-CONTRACTORS.xml&src=rss

SEATTLE (Reuters) - Microsoft Corp. (MSFT.O: Quote, Profile, Research) told more than 1,000 contract workers doing software development and testing to take seven business days off without pay to lower costs during this quarter, the company said on Monday.

Earlier this month, Microsoft asked half of the technology vendors it uses for software development to defer seven business days worth of work including this week, to the coming fiscal year starting July 1, said company spokesman Lou Gellos.

The software giant emphasized it was not over-budget, but certain divisions needed to pare back some costs in order to stay on budget. Microsoft said these types of cut-backs are a common way for technology companies to manage costs.

"It is fairly common within the industry, but not that common for Microsoft," said Gellos, who declined to be more specific about what areas of the company were involved except to say that the development was "not critical."

...more...

[UpInArms]

28. City of Hercules Battling Wal-Mart Stores

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

SAN FRANCISCO - Wal-Mart Stores Inc. is known for its hardball tactics, but the little city of Hercules has come up with some muscle of its own in a bid to keep the big-box retailer out.

The City Council in the affluent Bay Area suburb will hold a hearing Tuesday to consider using the power of eminent domain to seize the 17 acres where Wal-Mart intends to build a shopping complex. It's a novel approach to a fight that has taken place in communities across America.

"We want something good to take that place," said Jeffra Cook, a Hercules resident since 1988. "There aren't a lot of good stories about Wal-Mart."

Cook and other opponents in this bedroom community of 24,000 worry that Wal-Mart will drive local retailers out of business, tie up traffic and wreck its small-town flavor.

Wal-Mart spokesman Kevin Loscotoff accused Hercules of "playing politics" and said turning down a Wal-Mart would deprive the city of much needed revenue. He said some residents want a Wal-Mart in their community.

...more...

[kineneb]

67. Hercules not a "WalMart community"

I heard this on the radio this morning (KGO in SF). Hercules is fairly up-scale, and MallWart really wouldn't attract that many local shoppers. They didn't even want a BART extension to go there, so the rail line ends in Richmond; bad planning on their part, IMO. They actually have very little "local" business as it is a commuter city. Most people do their shopping at the complex in Pinole. I hope they are successful in keeping out WM.

[UpInArms]

29. U.S. May Ease Rules on Technology Exports to China

http://news.yahoo.com/s/ap/20060522/ap_on_bi_ge/china_export_controls

BEIJING - The United States may ease regulations on American technology exported to China if the importers can show they are not using it for military purposes, a U.S. official said Monday.

Companies that earn such trust could skip some bureaucratic oversight on restricted technologies that could have either peaceful or military uses, David H. McCormick, the U.S. undersecretary of commerce for industry and security, told reporters in Beijing.

The American Chamber of Commerce in China says that current U.S. export controls are too broad, opaque and unpredictable, driving some Chinese companies to avoid buying technology from the United States altogether.

McCormick praised a current system under which a U.S. official visits Chinese companies to make sure they are not diverting imported American technology into the military. He said that process could be expanded.

...more...

[UpInArms]

30. SEC says bars former Merrill Lynch broker in "squawk box" case

http://today.reuters.com/news/newsarticle.aspx?type=businessNews&storyid=2006-05-22T215417Z_01_N22407485_RTRUKOC_0_US-CRIME-SEC-COUGHLIN.xml&src=rss

WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission said on Monday it has barred former Merrill Lynch (MER.N: Quote, Profile, Research) broker Paul Coughlin from the securities industry over his involvement in a "squawk box" stock trading scheme.

Coughlin agreed to settle the action under which he may reapply in the future to work in the industry under certain restrictions, said the investor protection agency.

Coughlin pleaded guilty in March to conspiracy to commit securities fraud, the SEC said.

His plea came in a case in which day traders allegedly made improper trades based on confidential information obtained by listening in on squawk box communication systems that broadcast large securities buy and sell orders in brokerage offices.

...more...

[54anickel]

31. Bulls Retreat Worldwide as May Rally Turns to Rout

http://www.nytimes.com/2006/05/23/business/23stox.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1148387362-EZCc6dS9U4cOYD0ZhZdpKw

A three-year bull run in stocks has been losing strength in the last few weeks as concerns mount about higher inflation and slower growth.

Stocks fell again yesterday, with sharp declines in Asia and Europe, especially in emerging markets. The Dow Jones industrial average, which had been flirting with a record high on May 10, is down 4 percent since then. The Standard & Poor's 500-stock index is down 5 percent from its May 5 high, while the Nasdaq composite index is down 8 percent since its most recent high in April.

Yet to many investors, this slump only confirms that the earlier rally in stocks may have been hollow to begin with.

"I am shocked that the market is where it is at," said Ron N. DeCook, 65, a retired newspaper ad salesman who lives north of San Francisco. "I think business has improved, but I don't think it's through the rough. I wonder about the wars, the deficit — I wonder if we are in a false economy."

more...

PHFFFT! 3 year bull run? It trotted for the first year and meandered close to the fence line for the other 2 until just recently with this sucker's rally.

Gotta run for the day. Have a good one - things are looking bright and shiny this morning. :hi:

[stop the bleeding]

32. Thanks guys, my tickers are showing

high volume along with what looks like might be an up opening :) but we are still 45 minutes away.

I have 4 canaries ready to go this morning all Call plays. Let's see what happens :)

[UpInArms]

35. Treasurys lower as stocks, commodities rebound

http://www.marketwatch.com/News/Story/Story.aspx?guid=3b339431-8b87-4c74-b60e-2fe39eb77323&siteid=mktw&dist=MorePulse

NEW YORK (MarketWatch) - Treasury prices were lower early Tuesday, sending yields higher, as capital flowed out of the fixed-income market and back into rebounding equities and commodities markets. With a dearth of U.S. economic reports Tuesday, the bond market is taking its cues from other markets. "We're just seeing some profit-taking after the market made pretty good gains yesterday," said Kim Rupert, managing director of fixed-income at Ation Economics. During a rally on Monday, the 10-year benchmark yield ($TNX 50.74, +0.38, +0.8% ) briefly dipped below the closely-watched 5% level, prompting some selling. Federal Reserve Fed Chairman and Treasury John Snow are scheduled to address U.S. Senators later in the day. The benchmark 10-year Treasury note last was 11/32 lower at 100-13/32, yielding 5.071%, up from 5.03% at Monday's close.

[UpInArms]

39. Printing Press Hums: Fed adds temporary reserves to banking system

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T133256Z_01_N23343145_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, May 23 (Reuters) - The Federal Reserve said on Tuesday that it was adding temporary reserves to the banking system through overnight system repurchase agreements.

For details on the operation, see http://www.ny.frb.org/markets/omo/dmm/temp.cfm

Fed funds were trading at 5 percent, the Fed's target for the benchmark overnight lending rate, at the time of the operations.

From Monday, May 15 through yesterday, May 22 - The Fed has added $58.32 in repurchases (repos).

This information was taken from the amounts recorded at http://www.321gold.com/fed/temp_bank_res.html

[UpInArms]

58. Pumping out those Dollars!: Fed buys coupons, adding permanent reserves

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T144144Z_01_N23146699_RTRIDST_0_MARKETS-FED-OPERATIONS-UPDATE-1.XML

NEW YORK, May 23 (Reuters) - The Federal Reserve said on Tuesday that it was buying coupons, adding permanent reserves to the banking system.

The Fed bought coupons with maturities ranging from February 15, 2009 to December 15, 2009. There were five exclusions.

Settlement is for May 24, 2006.

Earlier the Fed added temporary reserves to the banking system through overnight system repurchase agreements.

For further details on the operation, see http://www.ny.frb.org/markets/omo/dmm/perm.cfm

Fed funds were trading at 5 percent, the Fed's target for the benchmark overnight lending rate, at the time of the operations.

[UpInArms]

88. Investors turn more bearish on Treasuries - poll

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T191054Z_01_N23PMPOLL_RTRIDST_0_FINANCIAL-TREASURIES-JPMORGAN.XML

NEW YORK, May 23 (Reuters) - U.S. Treasuries investors turned more bearish in the latest week, according to a poll released on Tuesday, as market participants bet there was more than a 50 percent chance the Federal Reserve would raise interest rates in June.

Investors surveyed on Monday who said they were "long" Treasuries, holding more U.S. government securities than their portfolio benchmarks, fell to 16 percent from 19 percent last week, J.P. Morgan Securities said.

Meanwhile, the share of investors polled who were "short" on Treasuries, or held less U.S. government securities than their benchmarks, rose to 37 percent from 35 percent last week, J.P. Morgan Securities said.

Those investors who were "neutral" on Treasuries, or held U.S. government securities equal to their benchmarks, edged up to 47 percent from 46 percent the week before.

...more...

[UpInArms]

36. NYSE fines Lehman Bros. $400,000 for inaccurate reports (2001-2004)

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BFB69AAE7%2D6862%2D4D2F%2D84A7%2DB0B0BCBD4A1C%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- New York Stock Exchange Regulation Inc. on Tuesday said it fined Lehman Brothers Holdings (LEH : 66.02, -1.46, -2.2% ) $400,000 for submitting inaccurate monthly reports on the company's short-interest positions. The reports were made between January 2001 and May 2004. Lehman neither admitted or denied the charges. Shares of Lehman fell 2.1% to $66.02. NYSE regulation is a not-for-profit subsidiary of NYSE Group Inc. (NYX : 62.85, -1.65, -2.6% ) .

Why would anyone think that these corporations have the consumers' best interests at the forefront????

I am sick to death of these inaccurate, misleading, bogus reports and accounting frauds that are perpetrated upon the markets. :mad:

[UpInArms]

37. pre-opening blather

09:15 am : S&P futures vs fair value: +5.5. Nasdaq futures vs fair value: +10.5.

09:00 am : S&P futures vs fair value: +5.2. Nasdaq futures vs fair value: +9.8. Stage remains set for the indices to open on a strong note as investors come to grips with the fact that fundamentals haven't changed nearly as much as market sentiment. Despite very little in the way of corporate news and no economic data on the docket to set the tone, the fact that selling has extended beyond a fundamental reaction to an extra 0.1% on the core CPI and left stocks at very reasonable valuations could be warranting the market bottom that many on Wall Street have been looking for to get back into stocks.

08:30 am : S&P futures vs fair value: +4.5. Nasdaq futures vs fair value: +6.8. Still shaping up for equities to rebound as futures indications continue to trade above fair value. With the Nasdaq at six-month lows and off nearly 8% over the last two weeks, within earshot of a 10% decline characteristic of a correction, the tech-heavy index appears poised to enjoy the bigger bounce among the majors given the scope of recent losses, especially among chip stocks.

08:00 am : S&P futures vs fair value: +3.4. Nasdaq futures vs fair value: +6.0. Futures versus fair value suggest the cash market will again try to regain some upside traction following several days of consolidation. Aside from a sense that the market is oversold on a short-term basis, U.S. indices may also be trading higher in sympathy with upbeat action overseas which, in stark contrast to yesterday's global sell-off, shows all three major European indices up more than 1.4% and at session highs.

[UpInArms]

38. 9:34 EST Nothing but Blue Skies for LaLa Land!

Dow 11,186.48 +61.15 (+0.55%)
Nasdaq 2,195.77 +22.91 (+1.05%)
S&P 500 1,270.15 +8.08 (+0.64%)
10-Yr Bond 5.074 +0.38 (+0.75%)

NYSE Volume 228,501,000
Nasdaq Volume 89,094,000

[UpInArms]

41. June Gold @ $666.70 oz - July Silver @ $13 oz - July Copper @ $3.655 lb

9:42 AM ET 5/23/06 JUNE GOLD UP $9, OR 1.4%, AT $666.70/OZ IN MORNING TRADING

9:42 AM ET 5/23/06 JULY SILVER RISES 57 CENTS, OR 4.6%, TO $13/OZ

9:42 AM ET 5/23/06 JULY COPPER UP 19.35 CENTS, OR 5.6%, AT $3.655/LB

[UpInArms]

63. June Gold @ $669.50 oz - July Silver @ $12.97 oz - July Copper @ $3.715 lb

11:29 AM ET 5/23/06 JUNE GOLD CLIMBS $11.80, OR 1.8%, TO $669.50/OZ

11:29 AM ET 5/23/06 JULY SILVER UP 53 CENTS, OR 4.3%, TO $12.97/OZ

11:29 AM ET 5/23/06 JULY COPPER TRADES AT $3.715/LB, UP 25.35 CENTS, OR 7.3%

[UpInArms]

78. Gold closes @ $673.70 oz - July Silver @ $13.17 oz - July Copper @ $3.8855

1:48 PM ET 5/23/06 JUNE GOLD UP $16, OR 2.4%, TO CLOSE AT $673.70/OZ

1:48 PM ET 5/23/06 JULY COPPER CLOSES AT $3.8855/LB, UP 42.4 CENTS, OR 12.3%

1:42 PM ET 5/23/06 JULY SILVER CLOSES AT $13.17/OZ, UP 74 CENTS, OR 6%

[Tace]

43. Just Now Gold Is $666.60 -- WHAT DOES IT MEAN?

Oh no!! The Beast! : )

[UpInArms]

46. Gold futures rise more than $10 in morning trading

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BE8DEB786%2DC884%2D40C4%2DA505%2D89042C141E6E%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- June gold climbed $10.30 to $668 an ounce in morning trading. "The combination of physical buying and a calmer currency market gave gold its best chance at another positive day in more than one week," said Jon Nadler, an investment products analyst at bullion dealers Kitco.com. July silver was up 60 cents, or 4.8%, at $13.03 an ounce and July tacked on 20 cents, or 5.8%, to stand at $3.6615 a pound.

[stop the bleeding]

45. Well that was a fun ride, time to goto lunch,

lets hope for some kind of overall support to be put into place today.

[UpInArms]

50. Sun Microsystems looking at 10,000(?) summer layoffs

http://www.mercurynews.com:80/mld/mercurynews/14646315.htm

(free registration or try www.bugmenot.com)

Sun Microsystems, the struggling Silicon Valley maker of computer servers, is planning to announce some layoffs by the end of July, the company's chief financial officer said Monday at a meeting of investors.

``We are now ready to resize the company,'' said CFO Michael Lehman at the JPMorgan technology conference for investors held Monday in San Francisco. He declined to give a number for the layoffs but said it would be less than the ``outlier'' estimate of 10,000 suggested by one industry analyst.

Lehman returned to be Sun's CFO in February after leaving the company in 2002. He repeated Monday that Sun's new chief executive, Jonathan Schwartz, would also look at several ways to cut costs -- including real-estate holdings -- and increase revenue.

Lehman said recommendations for a restructuring would be presented to the company's board of directors soon and announced by the end of July. A source said Sun could announce the layoffs in June.

The day after Schwartz was named CEO April 24, he vowed not to make deep job cuts that some on Wall Street had called for to stop the Santa Clara company's losses. Analysts later repeated predictions that Sun would make some layoffs, but not the massive cuts a few had proposed.

...more...

[UpInArms]

53. 10:36 EST Happy! Happy! Joy! Joy!

Dow 11,197.33 +72.00 (+0.65%)
Nasdaq 2,199.18 +26.33 (+1.21%)
S&P 500 1,272.93 +10.86 (+0.86%)
10-Yr Bond 5.066 +0.30 (+0.60%)

NYSE Volume 756,858,000
Nasdaq Volume 507,636,000

10:30 am : Stocks retrace earlier highs, so far shrugging off another 1.7% surge in oil prices. Even though crude oil futures are back above $71 a barrel, a negative for consumers, the Energy sector taking notice and providing some upside leadership to the tune of 2.6%. All 19 sector components, led by a 4.6% gain in Refiners, are trading higher. DJ30 +70.11 NASDAQ +24.47 SP500 +10.73 NASDAQ Dec/Adv/Vol 756/1952/470 mln NYSE Dec/Adv/Vol 717/2178/420 mln

10:00 am : Major averages are off their opening highs but eight out of ten economic sectors are still posting respectable gains. Pacing the way higher and up about 2.0% are Energy and Materials, reclaiming some of the strength that has vaulted them to the top of this year's leader board. Technology, though, is providing the bulk of early leadership, as rebounds in the underperforming Semiconductor and Software groups help the influential sector pare some its 4.4% year-to-date decline. Utilities, however, is failing to participate in today's recovery as the end of a three-day rally in Treasuries makes bond yields more attractive alternatives than dividend-paying stocks. Health Care is also showing relative weakness as Medtronic (MDT 48.04 -0.53) fails to garner much appreciation ahead of its earnings report tonight.DJ30 +46.50 NASDAQ +20.03 SOX +0.6% SP500 +7.98 XOI +2.5% NASDAQ Dec/Adv/Vol 559/1936/290 mln NYSE Dec/Adv/Vol 454/1830/246 mln

Reports, Smeports! A $400,000,000 fine here, a $400,000 fine there! Who cares! The game never stops! What Fun! What Fun!

(edited because $400 Million is not the same as $400,000 - it has more zeros! But... Who CARES!!!)

$11 Billion in Accounting Errors! YEEHAW! Massaging numbers so that the top officers get BIGGER bonuses! WHEE!!!

[AnneD]

54. Options Timing Probe Turns Criminal, So Will the Privilege Waivers Start F

The probe into whether corporate executives backdated documents to permit stock options grants to have a lower exercise (or strike) price, thus increasing the value of the options for them, has now turned criminal with the disclosure by Comverse Technology, Inc. that it has received a federal grand jury subpoena. The company's CEO, CFO, and Executive VP all resigned over the issue, and near the very end of an 8-K (here) it rather blandly notes, "On May 2, 2006 the Company received a subpoena from the United States Attorney's Office for the Eastern District of New York in connection with the issuance of stock option grants between 1995 and the present. The Company intends to fully cooperate with the United States Attorney in responding to this subpoena."

<snip>

Another company also disclosed that two of its senior executive resigned over backdating documents related to options grants. Power Integrations Inc. announced (here) that its chairman (and former CEO) and CFO resigned after an internal investigation revealed the following:

The special committee has reached a preliminary conclusion that the actual dates of measurement for certain past stock option grants differed from the recorded grant dates for such awards. As a result, the company expects to record additional non-cash charges for stock-based compensation expenses in prior periods. Based on the special committee's preliminary conclusion, the company expects that such non-cash charges will be material and that the company may need to restate its historical financial statements for each of the fiscal years 1999 through 2004, and for the first three quarters of the fiscal year ended December 31, 2005.

<snip>

It is surely more than a little unseemly for well-compensated executives to play a timing game to increase their compensation through stock options, and likely a breach of their state law fiduciary duty, but whether it is a securities fraud remains to be seen.

http://lawprofessors.typepad.com/whitecollarcrime_blog/2006/05/options_timing_.html

and another investigation
http://hcrenewal.blogspot.com/2006/05/caremark-rx-also-under-fire-for-timing.html

and another
http://www.tmcnet.com/usubmit/2006/05/20/1657264.htm

and OMG...even Faux is on it.
http://www.foxnews.com/story/0,2933,196228,00.html

I guess Faux exec's didn't get a back dated option package :eyes:

[UpInArms]

55. Fannie Mae report shows that there is no Boad of Director oversight

happening in corporate 'Murka!

Whee!

Stock Options! Bonuses! Bogus Accounting!

Hurrah for the FREE MARKETS!

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T140944Z_01_N232338_RTRIDST_0_FINANCIAL-FANNIE-UPDATE-2.XML

The U.S. Office of Federal Housing Enterprise Oversight, in its report on Fannie's nearly $11 billion accounting scandal, said it was going to announce a settlement with the mortgage finance giant. Sources have said the settlement would total $400 million.

"A combination of factors led Fannie Mae senior management, through their actions and inactions, to commit or tolerate a wide variety of unsafe and unsound practices and conditions," the report said.

"Fannie Mae's board of directors contributed to those problems by failing to be sufficiently informed and to act independently of its chairman, Franklin Raines, and senior management, and by failing to exercise the requisite oversight over the enterprise's operations."

Lehman Brothers perpetrated fraud with misleading reports! Whee!

Fines for everyone! Let's party!

Congress refuses oversight of Executive Office! Whee! Bribes for Everyone!

Hurrah for the FREE-dumbs!

[AnneD]

57. No oversite...

no foresight but plenty of hindsight. Riight. :eyes:

[Roland99]

70. "Money! It's a gas!"

Money, get away.
Get a good job with good pay and youre okay.
Money, its a gas.
Grab that cash with both hands and make a stash.
New car, caviar, four star daydream,
Think Ill buy me a football team.

Money, get back.
Im all right jack keep your hands off of my stack.
Money, its a hit.
Dont give me that do goody good bullshit.
Im in the high-fidelity first class traveling set
And I think I need a lear jet.

Money, its a crime.
Share it fairly but dont take a slice of my pie.
Money, so they say
Is the root of all evil today.
But if you ask for a raise its no surprise that theyre
Giving none away.

[UpInArms]

59. Commentary: Goldilocks wants her tax break

http://www.palmbeachpost.com/opinion/content/opinion/epaper/2006/05/22/a14a_blackburncol_0522.html

President Bush the Younger stuck his thumb in Congress, pulled out a tax cut for investors and said, "What a good boy am I." Members of Congress said: "See? We can get things done when we try."

A small child, looking on, said: "That tax cut is not a plum. It's a lemon."

<snip>

Displaying alarm but no panic, Brian Riedl of the Heritage Foundation noted that such fun and games increased federal spending by 45 percent in the Republican Era. In an essay in the D.C. Examiner, he computed that within 10 years it will take a $7,000-per-household tax increase to balance the budget.

Get control of spending, Mr. Riedl urges. Put a lid on entitlement spending like Social Security. And, finally, he says, make the Bush tax cuts permanent.

That last point is odd. To avoid having to raise taxes in the future, they should keep taxes low now? See, I told you they make things complicated.

<snip>

Under faith-based theorizing, when taxes were raised in the past it should have reduced revenue. But last time we faced huge deficits - after President Reagan's faith-based budgets - Presidents Bush the Elder and Bill Clinton raised taxes, and revenue rose. It rose enough, combined with spending cuts, to balance the budget. That case is not complicated. It's a simple exercise of the memory.

...more...

[UpInArms]

64. 11:43 EST numbers and blather

Dow 11,182.64 +57.31 (+0.52%)
Nasdaq 2,195.01 +22.16 (+1.02%)
S&P 500 1,271.46 +9.39 (+0.74%)
10-Yr Bond 5.064 +0.28 (+0.56%)

NYSE Volume 1,151,335,000
Nasdaq Volume 856,630,000

11:30 am : Market pulls back slightly as recent commentary from Fed Chairman Bernanke before the Senate Banking Committee renews some uncertainty about the Fed's direction on monetary policy. While another day absent of questionable economic data has allowed investors to refocus on fundamentals and reasonable valuations, Bernanke reminding investors that the May 10 policy statement noted upside inflation risks has stalled early recovery efforts. Bernanke also said he won't make judgments based on stock movements and that his comment to CNBC's Maria Bartiromo was a "lapse in judgment," as he will now confine comments to "regular and formal" arenas.DJ30 +42.11 NASDAQ +18.46 SP500 +7.55 NASDAQ Dec/Adv/Vol 952/1880/784 mln NYSE Dec/Adv/Vol 828/2187/668 mln

11:00 am : Market continues to sport broad-based gains as buyers remain in control of the early action. Aside from rebounds in commodities and Tech grabbing the spotlight, Homebuilders have also been in focus. Even after Toll Brothers (TOL 28.38 +1.48) said Q2 profits rose at the smallest pace in 3 years and then cut its FY06 EPS outlook, which plays into our Underweight rating on Consumer Discretionary, the housing group is also attracting bargain hunters. To wit, Homebuilding, which ranks as this year's third worst performing S&P industry group (-21.8%) is one of today's ten best performers. The PHLX Housing Sector Index (HGX) is off 11.7% year-to-date but is up 2.1% today.DJ30 +60.12 NASDAQ +23.96 SP500 +9.33 NASDAQ Dec/Adv/Vol 746/2021/626 mln NYSE Dec/Adv/Vol 672/2308/546 mln

[ozymandius]

66. hoo-haa still going

Dow 11,178.64 +53.31 (+0.48%)
Nasdaq 2,191.16 +18.30 (+0.84%)
S&P 500 1,269.28 +7.21 (+0.57%)
10-Yr Bond 50.64 +0.28 (+0.56%)
NYSE Volume 1,266,097,000
Nasdaq Volume 978,369,000

12:00 pm : Market is holding onto the bulk of the day's gains midday as a sense that yesterday's global sell-off was overdone reminds investors that fundamentals haven't changed nearly as much as market sentiment, renewing enthusiasm for equities across the board. Aside from reasonable valuations whetting the appetites of bargain hunters and participants hoping a market bottom has finally been reached, U.S. indices also got some early relief from strength overseas. All three major European indices more than erased Monday's losses with average gains of 2.5%.

Of the nine economic sectors trading higher, Energy has turned in the best performance (+2.2%), as traders rolling over their June positions into the July contract have helped lift crude oil futures back above $71 a barrel (+2.1%). Also benefiting from the sense that commodities have been oversold on a short-term basis has been Materials, which is up 1.8%. Technology, though, continues to provide the bulk of early leadership, as rebounds in the underperforming Semiconductor and Software groups offset a pullback in Hardware and help the influential sector pare some its 4.4% year-to-date decline. To wit, the tech-heavy Nasdaq is enjoying the biggest bounce among the majors given the scope of recent losses that left it at six-month lows yesterday and off nearly 8% over the last two weeks.

Meanwhile, homebuilder Toll Brothers (TOL 28.52 +1.62) had a good earnings report, but not surprisingly lowered its full-year EPS outlook, which plays into our Underweight rating on Consumer Discretionary. Be that as it may, as this year's third worst performing S&P industry group (-21.8%), even Homebuilding has attracted renewed buying interest. Utilities, however, is the only sector failing to participate in today's relief rally as the end of a three-day rally in Treasuries makes bond yields more attractive alternatives than dividend-paying stocks. The yield on the 10-yr note now stands at 5.06%. BTK +0.9% DJ30 +56.89 DJTA +1.0% DOT +1.2% NASDAQ +21.97 NQ100 +0.8% R2K +1.3% SOX +0.7% SP400 +0.9% SP500 +8.84 XOI +2.6% NASDAQ Dec/Adv/Vol 968/1913/908 mln NYSE Dec/Adv/Vol 903/2173/774 mln

[Roland99]

71. "fundamentals haven't changed nearly as much as market sentiment"

Guess it depends on how you define fundamentals.

[UpInArms]

75. 1:30 EST Markets get excited as OIL Price Rises

Dow 11,189.52 +64.19 (+0.58%)
Nasdaq 2,192.31 +19.46 (+0.90%)
S&P 500 1,270.82 +8.75 (+0.69%)
10-Yr Bond 5.066 +0.30 (+0.60%)

NYSE Volume 1,514,530,000
Nasdaq Volume 1,218,752,000

1:00 pm : Major averages are weakening a bit in afternoon trade but buyers continue to have the upper hand. Health Care inching into the red over the last 30 minutes, as the medical equipment space comes under pressure ahead of Medtronic's (MDT 48.07 -0.50) earnings tonight, is partly to blame. More consolidation in HMOs and relative weakness in the drug space have also been responsible for the sector's continued underperformance and its inability to provide much in the way of upside leadership so far this year.DJ30 +40.74 NASDAQ +16.58 SP500 +5.95 NASDAQ Dec/Adv/Vol 1132/1796/1.12 bln NYSE Dec/Adv/Vol 1145/2006/962 mln

12:30 pm : No real change in sentiment as the afternoon session gets underway. The bulk of industry leadership remains positive and advancers on both the NYSE and Nasdaq continue to outpace decliners by about 2 to 1. However, unlike the above average volume that provided even more conviction behind several days of declines, mixed volume today, as the NYSE has yet to see 1.0 bln shares exchange hands, is lending less credence behind today's recovery efforts. DJ30 +54.15 NASDAQ +19.05 SP500 +7.16 NASDAQ Dec/Adv/Vol 986/1911/1.03 bln NYSE Dec/Adv/Vol 1064/2103/874 mln

[stop the bleeding]

77. TIE, ATI, BTU DRQ, OII and PEIX have been following the

DOW quite closely on the intraday's

thanks for the update(s)

also BA seems to be following as well

[UpInArms]

76. P&G: "It's really not 100 employees losing jobs"

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T170350Z_01_N23205764_RTRIDST_0_MANUFACTURING-PROCTER-GILLETTE.XML

CHICAGO, May 23 (Reuters) - Some temporary work done for Gillette in Massachusetts is moving to a Procter & Gamble Co. (PG.N: Quote, Profile, Research) facility in North Carolina, leading to the elimination of about 100 jobs, a spokesman said on Tuesday.

The jobs were filled by a temporary agency and are not considered Gillette jobs, the spokesman said.

The losses are in addition to the planned job cuts that were announced when P&G acquired Gillette in October 2005. When P&G first announced its plan to buy Gillette, it said the deal would include the loss of about 6,000 jobs, or 4 percent of the companies' combined work force of 140,000.

<snip>

The jobs at the leased facility in Devens, Massachusetts were filled by Snelling Staffing Services. Workers at the pack-to-order operation would package items together, such as a set of Gillette razors and shaving gel, for promotions at specific retailers, the spokesman said.

"It's really not 100 employees losing jobs," Gillette's spokesman said. "It's about 100 positions that will be eliminated but those temps may able to be temp" elsewhere.

...more at link...

[AnneD]

82. What was just a temp position to P&G

was a job to those workers. Food on the table and gas in the tank.

[UpInArms]

80. Investment banks planning credit derivatives cos.

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2006-05-23T175711Z_01_N23180618_RTRIDST_0_FINANCIAL-DERIVATIVES.XML

NEW YORK, May 23 (Reuters) - Investment banks including Lehman Brothers and Deutsche Bank are setting up separate companies to trade credit derivatives and may eventually take them public, sources familiar with the matter say.

The new entities, known as "derivatives product companies," are similar to hedge funds. In fact, some hedge funds are themselves looking at setting up these companies.

But there is a crucial difference: hedge funds typically borrow money short-term, allow investors to pull out money on relatively short notice, and expect their trades to pay off in weeks or months rather than over years.

Derivatives product companies get capital from long-term investors like private equity funds, and make investments in credit that are expected to pay off over years.

For investment banks, setting up these companies requires about a year's worth of work with legal issues and rating agencies, said Randy Gonseth, a partner in the financial services advisory practice at Ernst & Young in New York.

...more...

[AnneD]

83. Why does stuff like this

fill me with a sense of foreboding.

[Robbien]

87. Could it just be the definition of derivative means just one big casino

bet.

Exactly what we need, more derivatives. Liquidity bubble anyone?

[UpInArms]

81. Shit Unraveling: Philip Morris sued for $364 mln, two Calpine plants

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-05-23T175935Z_01_N23179654_RTRIDST_0_ENERGY-CALPINE-LAWSUIT.XML

NEW YORK, May 23 (Reuters) - A trustee in Calpine Corp.'s (CPNLQ.PK: Quote, Profile, Research) bankruptcy case has sued a financing arm of Philip Morris parent Altria Group Inc. (MO.N: Quote, Profile, Research) to recover $363.5 million and control of two idled power plants, court papers show.

<snip>

According to Monday's complaint, a special-purpose entity formed by Philip Morris issued $366 million of secured notes to buy the two plants.

Thereafter, it leased the plants to Calpine affiliates, and pledged the plants and rent payments to U.S. Bank as collateral.

U.S. Bank said a default has existed since January, when the Calpine affiliates missed $16.6 million of rent payments. It also said no payment has been made on the notes since July 2005, and nearly all of the original principal remains due.

<snip>

According to the complaint, however, Philip Morris has refused to take possession of the plants. The Maine plant has been idle since November 2005, and the Rhode Island plant since February 2006, it said.

...more...

[UpInArms]

89. Spin Release: Investors Should Resist the Urge to Sell

(note from corporate press: Hold your stocks while we get out first :eyes: )

http://news.yahoo.com/s/ap/20060523/ap_on_bi_co_ne/biz_of_mutual_interest

NEW YORK - The great hope of investors, including those who buy into mutual funds, is that they'll buy low and sell high. But many people get tripped up on the sell high part, especially during a big decline, when it can take an iron will to resist the urge to pull out of the market.

Weak-kneed investors joined the panic party the last few weeks, when growing anxiety about inflation and rising interest rates sent stocks falling sharply, including a 214-point, or 1.88 percent, plunge in the Dow Jones industrials on Wednesday, May 17.

Selling tends to feed on itself as a declining market raises fears of a meltdown, in turn persuading more investors to unload their shares. But investors who sell under those conditions may soon regret such hasty decisions — investment analysts say people who hold tight to their mutual funds during a correction are usually better off in the long run.

"Individuals almost always do the wrong thing whenever there's an extreme movement in the market," said Charles Biderman, founder and chief executive of TrimTabs Investment Research, a Santa Rose, Calif.-based financial research provider. "If you're really a long-term investor, and you really think the U.S. economy is going to keep heading up, invest a certain amount of money every month and forget about it. Don't try to time the market if you're an individual investor."

Most people, it seems, do try to time it anyway. Biderman estimates that $500 million was withdrawn from U.S. equity funds on May 17 when the Dow Jones took its fall, and that wasn't an unusual or even an extreme reaction for a bad day on Wall Street.

...more...

[UpInArms]

90. 3:34 EST Heading for the close - getting weak-kneed?

Dow 11,171.11 +45.78 (+0.41%)
Nasdaq 2,175.80 +2.94 (+0.14%)
S&P 500 1,265.18 +3.11 (+0.25%)
10-Yr Bond 5.066 +0.30 (+0.60%)

NYSE Volume 2,265,873,000
Nasdaq Volume 1,811,934,000

3:30 pm : Similar to yesterday, when the indices failed to maintain the momentum of a late-day buying uptick and extended market losses, diminishing leadership over the last hour has stalled what was shaping up to be a more noticeable rebound. Fortunately for the bulls, buyers are showing some resolve going into the close and appear poised to finish the day on an upbeat note. Whether or not today's gains will be sustainable, however, is another question since there is still some uncertainty on the inflation front ahead of Friday's personal spending data and accompanying core PCE deflator -- one of the Fed's most closely watched inflation measures. DJ30 +46.34 NASDAQ +4.63 SP500 +3.48 NASDAQ Dec/Adv/Vol 1434/1591/1.78 bln NYSE Dec/Adv/Vol 1381/1852/1.54 bln

3:00 pm : Stocks across the board are beginning to lose momentum heading into the final hour of trading, spearheaded by further consolidation in the PHLX Semi Index which now leaves chip stocks in negative territory. The Health Care sector extending its reach to the downside as well as a pullback in retail which has prevented the Consumer Discretionary sector from staying in the green are also responsible for all three major indices now trading near session lows. DJ30 +29.13 NASDAQ +3.91 SOX -0.6% SP500 +2.52 NASDAQ Dec/Adv/Vol 1303/1701/1.59 bln NYSE Dec/Adv/Vol 1267/1962/1.39 bln

[ramapo]

91. Phew!

Good to see that everything is back in order in our financial house of cards. If this gain holds, there'll be happy talk galore across the financial media.

I feel better knowing that, no matter what, the stock market defies logic.

It is amazing the money made manipulating an economy that is propped up by debt, sheds good jobs for bad, and purrs along at minimal inflation while the cost of living increases everyday.

[UpInArms]

92. 3:44 EST weak hands losing their grip

Dow 11,132.46 +7.13 (+0.06%)
Nasdaq 2,167.74 -5.12 (-0.24%)
S&P 500 1,260.81 -1.26 (-0.10%)
10-Yr Bond 5.066 +0.30 (+0.60%)

NYSE Volume 2,370,556,000
Nasdaq Volume 1,904,159,000

[ozymandius]

93. at the close

Dow 11,098.35 -26.98 (-0.24%)
Nasdaq 2,158.76 -14.09 (-0.65%)
S&P 500 1,256.57 -5.50 (-0.44%)
10-Yr Bond 50.66 +0.30 (+0.60%)
NYSE Volume 2,638,845,000
Nasdaq Volume 2,178,064,000

:shrug: What happened? :shrug:

4:20 pm : What was shaping up to be a respectable bounce after several days of consolidation created a sense that stocks were oversold on a short-term basis lost steam going into the close as inflation fears returned. The Dow failed to reclaim some of the 4.1% it has lost since topping out at a five-year high on May 5th. The Nasdaq fared even worse, relinquishing a 1.2% intraday which would have brought the index close to breakeven for the year before closing at a new six-month low.

Before the bell, stocks regained some upside traction as investors came to the realization that fundamentals haven't changed nearly as much as market sentiment. Despite very little in the way of corporate news and no economic data on the docket to set the tone, the fact that selling has extended beyond a fundamental reaction to an extra 0.1% on the core CPI and left stocks at very reasonable valuations also left many thinking that the market bottom had finally been reached. Nonetheless, some uncertainty ahead of the April core PCE deflator -- another widely watched inflation measure that will hit the wires Friday morning, and ongoing concerns about higher interest rates and rising commodity prices -- both of which address inflation concerns that continue to underscore our Neutral market view -- returned to the forefront of investors' psyches.

To wit, the yield on 10-yr note rebounded to 5.05%, ending a three-day rally in Treasuries that yesterday pushed the 10-yr yield below the psychologically significant 5.00% barrier to hit 4.986% -- the lowest level since late April. The latter took a toll on Utilities, which turned in the day's worst performance since higher bond yields diminished the attraction of dividend paying stocks. The rise in borrowing costs eventually weighed on the Financial sector as well, offsetting renewed momentum in one of the sector's few bright spots -- Fannie Mae (FNM 50.86 +0.59). The mortgage lender gained 1.0% after the release of a report compiled by the Office of Federal Housing Enterprise Oversight was billed as a step in the right direction.

On the commodity price front, oil prices surged 2.6% and climbed back above $71 a barrel, which renewed some influential leadership in Energy to the tune of more than 2.5% intraday; but that wasn't enough to prevent late afternoon profit-taking which left the sector flat on the day. Also initially benefiting from the sense that ongoing consolidation in commodities was overdone was Materials, which was up more than 2.0% at one point as copper soared 12% to post its best one-day gain ever and gold traded higher for the first time in five days. When it was all said and done, however, what had acted as sources of early support quickly became apparent as sources of nervousness with regard to the direction of Fed policy.

Also weighing on the proceedings was the influential Technology sector's inability to hold onto modest recovery efforts, as evidenced by the tech-heavy Nasdaq totally erasing an early gain of 1.2% to eventually leading the way lower among the majors. The biggest drag on the sector was further deterioration in the Semiconductor group, which was up 1.4% before completely rolling over into the close to finish down 1.6% and extend its year-to-date decline to more than 3.0%.DJ30 -26.98 NASDAQ -14.10 SOX -1.6% SP500 -5.49 XOI +0.5% NASDAQ Dec/Adv/Vol 1700/1352/2.17 bln NYSE Dec/Adv/Vol 1776/1477/1.91 bln

[Roland99]

95. FUD entering the markets?

And, btw, Vonage went public today at about $17/share. I forgot to register. Was going to buy a few shares (or try to anyway)

[upi402]

100. maybe good to have missed Vonage ipo...

http://techsearch.cmp.com/blog/archives/2006/05/vonage_ipo_only.html?loc=networking_and_telecom

[Roland99]

101. Thanks for that.

[54anickel]

96. Well, WTF? Things were going "swimmingly" before I left. If this keeps

up we'll see that 10,000 10,500 area the DOW was range bound in for the better part of a year. That'll put her back right where she started when the usurper moved into the WH. NAS and S&P are still worse off than that fateful day. Geez, Bush sucks!

[Mojorabbit]

99. I don't know if this contributed to it

Dollar Rises as Bird Flu Scare Fuels Demand for Safer Assets
May 24 (Bloomberg) -- The dollar gained for a second day in Asia after a World Health Organization report said seven Indonesians may have contracted bird flu from other people, bolstering demand for safer investments.
A spread of the infection, which until now has only been detected in humans who have had direct contact with birds, may hurt global economic growth and increase demand for assets such as U.S. Treasuries, which yesterday rose for a fourth day. Six of the Indonesians have died, with all having had contact with severely ill patients, the WHO said in a statement yesterday.

``Markets are focusing on the bird flu and are seeing the downside risks to the global growth view,'' said Stephen Koukoulas, chief Asia-Pacific strategist at TD Securities Ltd. in Sydney. ``We're probably seeing some safe-haven momentum and the U.S. dollar is the preferred currency in difficult times.''
Also
Australian Dollar Falls on Concern Over Bird Flu in Indonesia
May 24 (Bloomberg) -- The Australian dollar fell on concern bird flu may have developed in Indonesia, its biggest neighbor, so it can pass from human to human.

The Australian dollar fell from its highest level this week after it was reported United Nations disease trackers probing the possibility of human-to-human transmission of bird flu said a group of seven Indonesians may have contracted the disease from other people rather than birds. A bird flu outbreak could threaten economic growth.

``Because Indonesia is in the same region as Australia, and the Australian dollar is a liquid currency, it's the currency that's getting smashed,'' said Stephen Koukoulas, chief Asia- Pacific strategist at TD Securities Ltd. in Sydney.`

(It seems to me Australia had said in the past they would close their borders if WHO went to phase four and today they suggested they might have a conference to do just that... mojo)

[RUMMYisFROSTED]

98. That's gonna leave a mark.