STOCK MARKET WATCH, Wednesday 19 July

[ozymandius]

Wednesday July 19, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 917 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2034 DAYS
WHERE'S OSAMA BIN-LADEN? 1734 DAYS
DAYS SINCE ENRON COLLAPSE = 1695
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
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 July 18, 2006

Dow... 10,799.23 +51.87 (+0.48%)
Nasdaq... 2,043.22 +5.50 (+0.27%)
S&P 500... 1,236.86 +2.37 (+0.19%)
Gold future... 629.50 -22.40 (-3.56%)
30-Year Bond 5.16% +0.06 (+1.14%)
10-Yr Bond... 5.13% +0.06 (+1.20%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Ike Iossif - WEEKLY CHARTS

Last week we said, "Both the McClellan Oscillators, and the Quantifiers suggest that last week's action ought not to be interpreted too bearishly, unless there is a clear close below support. Moreover, the current pattern indicates that the two most possible scenarios going forward are the two shown below. Notice that in either case we ought to get another attempt to the upside before a bearish or bullish resolution takes place. Is it possible for the markets to go straight down from here? EVERYTHING IS POSSIBLE, but at this point such action is not very probable, unless something exogenous happens. Thus, for the time being we are looking for a rally towards the highs of last week, and we'll re-evaluate once the markets get there."

Last week, exogenous events in three different fronts involving Iran, North Korea, and Israel/Lebanon did take place, the indices did close below support, and thus, the least probable scenario--from a purely technical point of view--came to fruition! Going into next week, we have the EXACT same situation; the technicals suggest that a short-term bottom ought to be at hand, but the geopolitical tensions remain high. Consequently, all "technical" bets are off at this point. If the conflict in the Middle-East widens with Syria and Iran getting into it, it doesn't matter what the technicals say, oil is going above $90, and the indices are going to the first downside targets, and more likely, to the second ones (see table below). Please read additional comments below. Also please read Uranium, Gold, and America's march towards fascism.

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

[54anickel]

29. Up and down, or perhaps more back and forth like a baby swing

lulling the buy and hold investor to sleep. Each swing back gets a bit wider, but rest assured it swings forward again, though maybe a little bit less. Surely, if I just sit tight the forward momentum will again catch up, just as it always has in the past. Ignore the day to day swings, the chartist don't know what they're talking about - this is a new kind of market afterall. :eyes:

[ozymandius]

2. Today's Reports

8:30 AM Building Permits Jun
Briefing Forecast 1930K
Market Expects 1920K
Prior 1946K

8:30 AM Core CPI Jun
Briefing Forecast 0.2%
Market Expects 0.2%
Prior 0.3%

8:30 AM CPI Jun
Briefing Forecast 0.2%
Market Expects 0.2%
Prior 0.4%

8:30 AM Housing Starts Jun
Briefing Forecast 1905K
Market Expects 1900K
Prior 1957K

10:30 AM Crude Inventories 07/14
Prior -5985K

[stop the bleeding]

14. these reports today should make things "interesting"

:donut:

[54anickel]

44. Housing Starts And Building Permits Show Substantial Decline

http://www.tradingmarkets.com/tm.site/news/ECONOMIC%20NEWS/310345/

(RTTNews) - The Commerce Department released its report on housing starts in the month of June on Wednesday, showing that housing starts fell more than economists had expected. The report also showed a notable decline in building permits.

The report said that housing starts fell 5.3 percent to a seasonally adjusted annual rate of 1.850 million units from a revised 1.953 million unit rate in May. Economists had expected starts to fall to a 1.890 million unit rate from the 1.957 million unit rate originally reported for May.

The decrease in housing starts reflected double-digit percentage declines in housing starts in the Northeast and the West. Housing starts in the South showed a more modest decrease while housing starts in the Midwest increased modestly.

snip>

The Commerce Department also said that building permits fell 4.3 percent to a seasonally adjusted annual rate of 1.862 million units in June from a 1.946 million unit rate in May. Building permits are seen as an indicator of demand.

Decreases in building permits were seen in the Midwest, South, and West, while building permits in the Northeast rose by 6.1 percent.

more...

[54anickel]

45. Core CPI up 0.3% on rising rents

Consumer prices rise moderate 0.2% in June; energy prices fall

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=google&guid=%7B0CC3A975-EA5A-4EDD-8180-1CA4F966184D%7D&keyword=

WASHINGTON (MarketWatch) -- U.S. consumer prices increased a moderate 0.2% in June, the smallest gain in four months, but core inflation rose by 0.3% for a fourth straight month, putting pressure on the Federal Reserve to raise interest rates again.

The Labor Department said Wednesday the consumer price index increased 0.2% last month after rising 0.4% in May. Energy prices fell 0.9%, while food prices rose 0.3%.

The CPI increased at a 5.1% annual rate in the second quarter and is up 4.3% in the past 12 months, matching the biggest gain since last October. The core CPI increased at a 3.6% annual rate in the second quarter and is up 2.6% in the past year, a bit more than the Fed would like. It's the fastest increase in core inflation since December 2001.

The major factor driving higher inflation was the cost of shelter, which represents more than 30% of the CPI. Residential rents rose 0.4%, while owners' equivalent rent also increased 0.4%.

Bonds losses mounted after the report, sending the benchmark 10-year Treasury note's yield higher. The fixed-income market is generally undermined by indications of rising prices because inflation erodes the value of bonds and puts pressure on the Fed to continue lifting rates.

more...

[54anickel]

50. Crude Inventories Rise 200,000 Barrels, Break Recent Streak Of Declines

http://www.tradingmarkets.com/tm.site/news/FOREX%20NEWS/310514/

(RTTNews) - The Department of Energy's Energy Information Administration said that crude oil inventories edged higher by 200,000 barrels for the week ended July 14. Specifically, the measure ticked up to 335.5 million barrels from the previous week's level of 335.3 million barrels. This broke a recent string of declines, with inventories dropping by 6 million barrels in the previous week. Oil inventories for the July 14 week were 3.2% higher than last year.

[54anickel]

51. API reports fall in crude supply, but gasoline supply rises

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BB2A08D08%2DA48E%2D4535%2D92E7%2D914BC0A1B850%7D&dist=newsfinder&siteid=google

SAN FRANCISCO (MarketWatch) -- The American Petroleum Institute said crude supplies fell 940,000 barrels for the week ended July 14, contrary to the Energy Department's reported 200,000-barrel climb. Motor gasoline inventories were up 1.3 million barrels, despite expectations for a decline. Distillate stocks fell 3.6 million barrels, the API said. The Energy Department reported a 1.2 million-barrel increase in the fuel's supply.

[Roland99]

55. I think I'd be worried if they were the same!

[ozymandius]

3. Oil prices rise near $74 a barrel

SINGAPORE - Crude oil prices rose in Asian trading Wednesday amid expectations that midweek U.S. inventory figures would show a decline in domestic gasoline stocks on strong demand for motor fuel during the summer driving season.

Light, sweet crude for August delivery gained 38 cents to $73.92 a barrel in electronic trading on the New York Mercantile Exchange as of mid-afternoon in Singapore. Gasoline futures rose 1.75 cents to $2.2845 a gallon.

September Brent crude futures on London's ICE Futures exchange rose 51 cents to $74.87 a barrel.

Crude oil prices on Tuesday slid back to the level they traded at before fighting started between Israel and militants in Lebanon. The contract tumbled 2 percent to settle at $73.54 a barrel. The last time front-month Nymex oil futures settled below $74 was July 10.

more

[ozymandius]

4. Oil price spike "very uncomfortable": OPEC

ABUJA (Reuters) - The latest spike in oil prices is "very uncomfortable" and it is having a negative impact on the world economy, OPEC President Edmund Daukoru said on Wednesday.

Daukoru, who is also Nigeria's top oil official, told Reuters the Israel-Hizbollah conflict was responsible for the latest spike, which saw U.S. crude oil futures hit $78.40 a barrel last week, and that OPEC had plenty of spare production capacity should it be needed.

"If it would have stabilized around the mid-60s, I don't think people would complain too much. We are getting used to that, but the latest shootup to the mid-70s and above is very uncomfortable," Daukoru said on the sidelines of a conference in the Nigerian capital.

more

[ozymandius]

7. Oil Falls to Three-Week Low Before U.S. Crude Stockpiles Report

uly 19 (Bloomberg) -- Crude oil fell to a three-week low amid speculation a report later today will show U.S. stockpiles of oil declined less than expected last week.

The U.S. Energy Department will probably report the nation's oil supplies dropped by 650,000 barrels, according to the median forecast from a Bloomberg News survey of 16 analysts. By contrast, stockpiles plunged by 6 million barrels the week before, which included the Independence Day holidays.

The market ``is trading on emotion,'' said Elizabeth Miller, the head of research at RedTower Ltd., a financial research and trading company in Scotland. Oil ``is trading on worries about Iran, worrier about Israel, worries about Nigeria. It's not a problem with the supply side. It's just a perception of the problem, and that's what's driving the market.''

more

[UpInArms]

12. Crude Futures @ $73.03 bbl

7:13 AM ET 7/19/06 CRUDE FUTURES DOWN 51C AT $73.03 A BARREL

[Roland99]

21. What a bargain! That's only, $1 below post-Katrina levels!!

[UpInArms]

87. August Crude closes @ $72.66 bbl - NatGas @ $5.862 mln btus

2:58 PM ET 7/19/06 AUGUST CRUDE CLOSES AT ITS LOWEST LEVEL SINCE JUNE 28

2:58 PM ET 7/19/06 AUGUST CRUDE FALLS 88 CENTS TO CLOSE AT $72.66/BRL

2:58 PM ET 7/19/06 AUGUST NATURAL GAS UP 5.5% TO END AT $5.862/MLN BTUS

[Roland99]

89. You know what's interesting...

When oil first hit $70 last year and again this year, gas here shot to $3.00+/gal. Right now, many places around town are about $2.93 and they'll likely drop to the low $2.80s yet oil will still be higher than $70/bbl.

Just working us over....working us over.

[wordpix2]

98. price is 3.09-3.18 /gal here in CT

[ozymandius]

5. Bernanke seen yielding few clues on rates

WASHINGTON (Reuters) - Federal Reserve Chairman Ben Bernanke goes before Congress on Wednesday to deliver testimony on the U.S. economy that financial markets will scour for clues on where interest rates are heading.

But analysts said markets may well be disappointed -- unless a surprisingly strong reading on core consumer prices forces Bernanke's hand.

-cut-

Bernanke's task when he appears before the Senate Banking Committee to present the Fed's semi-annual monetary policy report is particularly complicated because the central bank is wrestling with higher inflation and slowing growth.

more

[ozymandius]

6. Europe's bourses open stronger

European bourses opened stronger as oil held about $4 below last week's peak and the dollar hung near three-month highs against the euro ahead of US Federal Reserve chairman Ben Bernanke's Senate testimony.

Investors were awaiting indications on the outlook for US monetary policy from Mr Bernanke with concerns over containing inflation balanced on a knife edge with worries the Fed's could overdo tightening and damage global growth.

more

[ozymandius]

8. Microsoft and Nortel unite on communications

Nortel has signed a four-year deal with Microsoft for the development and installation of integrated voice and data communications products running on Windows.

Under the Innovative Communications Alliance, Microsoft and Nortel will form joint teams to develop products due in 2007, cross-license intellectual property and participate in sales and marketing activities. Additionally, Nortel will become a strategic systems integrator of products and services developed through the union.

Agreement with Nortel is a major piece of the Microsoft's unified communications jigsaw. Microsoft unveiled its plan for unified voice, email, IM and video communications in Office 2007 and Windows last month, and immediately nailed down the mobile portion of the strategy by announcing backing from Motorola.

http://www.channelregister.co.uk/2006/07/18/microsoft_nortel_unified_communications/

[UpInArms]

9. daily dollar watch

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

Last trade 87.13 Change +0.07 (+0.08%)

Strong Inflation Report and Foreign Investment Boosts Dollar

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Strong_Inflation_Report_and_Foreign_1153259334153.html

US Dollar
Surprises were the day’s themes as most US numbers came in much stronger than expected while Eurozone numbers took a surprise turn for the worse. Not only did we see producer prices grow by a faster pace in the month of June, but net foreign inflows were also solid in the month of May. More specifically, a surge in food prices drove headline producer prices up 0.5 percent, compared to the market’s forecast for a tamer 0.3 percent rise. The growth of core prices however was a bit steady, which muddles the inflation outlook somewhat. Having grown by 0.3 percent in May, core prices grew by only 0.2 percent in June. The sharp rise in food prices and today’s PPI number in general suggests that we could see a stronger headline CPI report. The growth of core prices however could remain modest. Yet it seems that Bernanke focuses more on the overall inflation picture rather than just the trend of core prices. As such, traders are expecting a tinge of hawkishness, if not an outright indication of another rate hike at his semiannual testimony on the economy and monetary policy before the Senate tomorrow morning. Bernanke will need to walk a fine line if he doesn’t want to be known as mixed message Ben. At the last monetary policy meeting in June, the Fed toned down their FOMC statement by qualifying the need for another rate hike based upon incoming inflation and economic data. Although inflationary pressures have increased, a shift from a less hawkish back to solidly hawkish stance would have the critics kicking and screaming about how Ben can not make up his mind. Meanwhile foreign investment was surprisingly strong in the month of May. Flight to safety has prompted strong demand for dollar denominated assets, particularly US bonds which now offer a nice yield. Originally expected to only increase by $58.4 billion, foreign investment actually exceeded the same month’s trade deficit, rising by $69.6 billion. Yet not all news was goods news, central banks actually dumped $14.3 billion worth of bonds, the largest amount in over seven years (validating the trend of reserve diversification). In addition, the NAHB homebuilders’ index fell to the lowest level in 14 years. This indicates that even though inflation pressures remain high, there are clear signs that the economy is beginning to weaken and should the Fed persist with their interest rate hikes, they will at the same time raise the possibility of a recession. Bernanke has quite a task before him and one that we can only hope he handles well.

...more...

Tomorrow's Economic Releases: US Inflation Back On The Menu

http://www.dailyfx.com/story/calendar/key_events/Tomorrow_s_Economic_Releases__US_Inflation_1153261628314.html

US Consumer Price Index (JUN) (12:30 GMT; 08:30 EST)
(MoM) (YoY)
Consensus: 0.2% 4.3%
Previous: 0.4% 4.2%

Outlook: Upcoming inflation data will provide powerful insight into the next move by the US Federal Reserve Bank. The bank has been waging a steady war against inflation with 17 straight rate increases from 1.00% to the current 5.25% level. The bank noted that "inflation expectations remain contained," but that "the high levels of resource utilization and of the prices of energy and other commodities have the potential to sustain inflation pressures." The short downturn in oil prices (before the recent spike above $78) caused an expected drop of 0.5% in gasoline prices, which have been weighing heavily on consumers. Of primary concern is the accelerated rate of inflation in the second quarter. Over the past three years inflation has generally been stronger in the first and third quarters with contractions in the second and fourth quarter. This year, however, inflation remains high, with 0.6% and 0.4% monthly rises in April and May respectively. Maintaining a historical perspective in gauging Fed rate hikes, it is interesting to note that current year over year inflation levels (4.3% expected) remain at the lower end of the spectrum for the last 40+ years, excluding a temporary dip at the end of 2003. Nevertheless, the Federal Reserve Bank remains wary and Bernanke still looks to establish himself in the post-Greenspan era.

Previous: The 0.4% rise in inflation was higher than the forecast for the third consecutive month. Core inflation, stripping out volatile food & energy components, rose 0.3%; also above expectations for the third straight month. Prices continue to rise despite the Federal Reserve Board’s continued battle against inflation. The skyrocketing cost of oil and strong rises in commodity prices have been working their way downstream as producers are forced to pass on the bill to consumers in an effort to conserve profit margins. Most economists note, however, that barring a massive surge in oil to $100 or above, inflation should be containable. The US economy, while still susceptible to changes in oil price, does not have the same singular focus as it had during the 1970 stagflation crisis.


US Housing Starts (JUN) (12:30 GMT; 08:30 EST)

Consensus: 1898K
Previous: 1957K

Outlook: Housing starts are expected to decline 0.3% to just under 1.9 million in June after May's unexpected rise above the mark. The housing market, vital to consumer wealth, is off of an all-time high in new starts at 2265K in January and below the 2 million mark considered expansionary for the market. Expectations for June have been moderated as analysts believe May’s report was skewed due to poor weather pushing back the undertaking of many projects until the following month. The real estate sector, which was booming in recent years, has suffered a period of substantial cooling in the second quarter, down almost 10% from the opening three months of 2006. Adding to support, historically housing permits tend to be considerably higher than housing starts for the following month, so the 1946K number registered in May suggests new starts could end up very close to the 1898K forecast in groundbreakings. Additionally, rain and flooding across the Northeast and Mid-Atlantic and concerns of wildfires in the Southwestern US have also played their part in limiting development.

Previous: May housing starts saw a bounce from a 13-month low to 1957K, easing concerns that the housing market could head lower at a pace that could crimp economic expansion beyond central bank expectations. The monthly numbers indicate that the expected slowdown in the market will likely be gradual, as opposed to a free-fall. Construction of single-family homes was up 2.1% while multi-family homes shot up 20%, although that number was largely a correction to May's drop. The Western United States led the advance with a 16% jump in construction, trailed by 8.5% in the Southern portion of the country and only a modest 1.7% increase in the Northeast. The Midwest saw a considerable decline of 16%.

...more...

[54anickel]

22. Wonderful! Will the dollar look as appealing once we start to show

we're sliding into recession? Where will the currency traders go when that happens while they face geo-political risks elsewhere?
How's an investor gonna demand a higher risk premium from the US if the rest of the world appears even riskier? Gotta keep stirring up the mayhem in the pot. Seems US investment fundamentals are becoming based upon FUD - is that all we have left to attract investors? :freak:

[54anickel]

48. Dollar pares gains after Bernanke (Dovish)

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BFCD5DBC4%2D8B06%2D4326%2D93B1%2DC262E78C5E5C%7D&dist=newsfinder&siteid=google

NEW YORK (MarketWatch) - The dollar came off from three-month highs Wednesday after Federal Reserve Chairman told Congress the U.S. economy was likely to slow, which should ease inflationary pressures. This left the door open for a pause in the current cycle of rising interest rates. "Bernanke testimony is on the dovish side as his initial comments refer to the bigger picture and downplay near-term inflationary concerns," said currency traders at Gain Capital. The euro was last at $1.2571 vs. $1.2473 before Bernanke's testimony, while the dollar was at 116.92 yen vs. 117.83 yen.

[UpInArms]

10. Top shareholder warns Citigroup must cut costs: report

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B5F84F772%2D83F1%2D4130%2D8069%2D6C84D070000E%7D&dist=newsfinder&symbol=&siteid=mktw

LONDON (MarketWatch) -- Citigroup's (C :) biggest shareholder has warned that the bank must curb the "disease" of rising costs before the U.S. economy slows down, the Financial Times reported. In an interview with the newspaper, Prince Alwaleed bin Talal said investors are losing patience with the company and expressed concern that costs are being allowed to grow faster than revenue. His comments followed a disappointing set of quarterly results from the bank on Monday, which fell short of analyst expectations. The prince, who has a $10 billion stake in Citigroup, said he has no intention of selling his shares, but warned other investors may not be so patient, the FT reported.

[UpInArms]

11. Audit Shows Wasted Katrina Emergency Expenses

http://cbs4boston.com/hurricanes/hurricanekatrina_story_199230711.html

(AP) WASHINGTON The government wasted hundreds of thousands of dollars in Hurricane Katrina's aftermath on iPods, dog booties, beer-making equipment and designer jackets, congressional investigators have concluded.

More than 100 laptop computers and a dozen boats also bought by Homeland Security Department employees following the storm are missing, the investigators found.

Poor training, lax oversight and rampant confusion over what employees are allowed to buy with government-issued purchase cards left Homeland Security "vulnerable to fraud, waste and abuse," according to a Government Accountability Office draft report.

The report was to be released Wednesday by a Senate panel that oversees the department.

Senators said more than 10,000 Homeland Security employees carry purchase cards for business-related expenses -- with a spending limit that was raised to $250,000 for emergencies after Katrina hit last Aug. 29. But the investigators found that employees received scant training on how to use the cards, were given little or lax supervision and were told to follow spending guidelines that differed among the 22 agencies that make up the department.

The department spent $435 million with the purchase cards in the 2005 budget year, compared to $296 million in 2004, Homeland Security spokesman Russ Knocke said Tuesday evening. But he said only a fraction of the expenses were improper, noting that the department has disciplined about 70 employees amid 1.1 million purchases.

...more...

[UpInArms]

13. I have to go away for the morning

so all you other marketeers and lurkers will have to fill in the blanks!

:hi:

[Roland99]

15. Don't have too much fun!

[Roland99]

16. Futures look up

Dow futures were up 9 points at 10,875, Nasdaq 100 futures were off 3.75 points at 1,483 while S&P 500 futures were up 2.30 points at 1,248.

[stop the bleeding]

17. Before the market - blather - hope this helps

MARKET SNAPSHOT

Stocks looking at mixed open; Yahoo hits tech


Core CPI shows inflation heating up; Bernanke testimony awaited
PrintE-mailDisable live quotesRSSDigg itDel.icio.usBy Mark Cotton, MarketWatch

Last Update: 9:12 AM ET Jul 19, 2006


NEW YORK (MarketWatch) -- U.S. stock futures are pointing to a mixed open Wednesday, with the technology sector bearing most of the weakness, as higher-than-expected core consumer inflation data and disappointing results from Yahoo offset strong profit growth at J.P. Morgan Chase and IBM.

Investors also remained cautious ahead of Federal Reserve Chairman Ben Bernanke's testimony to Congress.
Dow futures were up 9 points at 10,875, Nasdaq 100 futures were off 3.75 points at 1,483 while S&P 500 futures were up 2.30 points at 1,248.

"Bernanke has been prepared to say what he is going to say today for a while, but we're not going to like it," said Art Hogan, chief market strategist at Jefferies & Co. "Whatever the market does at the opening changes drastically once Bernanke starts talking at 10 o'clock."

Hogan said Bernanke's testimony comes just as the latest consumer price report shows inflationary pressures in the economy picking up.

Nevertheless, said Hogan, "the overriding concern is the geopolitical tension in the Middle East."
Hogan said you have conflicting reports on the conflict with some saying Israel can get this wrapped in a couple of weeks, while others suggest it could still take some time.

The BBC, quotes a senior Israeli commander, Gen. Alon Friedman, as saying that it could takes weeks to see a turning point in the fighting.

On Tuesday, stocks ended higher helped by a retreat in crude-oil prices and some solid earnings reports from United Technologies and Coca-Cola among others, but the volatile situation in the Middle East combined with unsettling inflation and housing data left investors in an uncertain frame of mind.

http://www.marketwatch.com/News/Story/Story.aspx?column=Market+Snapshot&siteid=

[Roland99]

18. 9:32am - What, me worry?

DJIA 10,848.69 +49.46 +0.46%
Nasdaq 2,039.24 -3.98 -0.19%
S&P 500 1,240.76 +3.90 +0.32%
Dow Util 421.46 +1.21 +0.29%
NYSE 7,915.20 +16.84 +0.21%
AMEX 1,882.88 +0.08 +0.00%
Russell 2000 682.02 +0.38 +0.06%
Semcond 407.05 +1.81 +0.45%
Gold future 628.50 -1.00 -0.16%
30-Year Bond 5.19% +0.03 +0.50%
10-Year Bond 5.16% +0.03 +0.64%

[stop the bleeding]

20. looks like we are on our own

until 54nickle, ghost dog, others or UIA checks back in.

[stop the bleeding]

19. The DJIA and S&P have jumped out to positive trading, but the

NASDAQ is a bit under still.

[54anickel]

23. Remember, "we" includes the Chinese (Mogambo)

http://www.321gold.com/editorials/daughty/daughty071906.html

snip>

How could I explain to this government goon squad about the strange and scary perturbations in the flow of economics? Can they even be made aware of such things as the frightening levels of activity in the bank repo market, where $11 billion per day is now expected! With spikes into the high $20's of billions! Per day!

Then I realize how to connect with them! I shout "What about oil, you nasty bastards? The price per barrel is up around $75 a barrel, and the price zooms up and down by a buck and a half a day sometimes!"

And it is not just the money, but that such sudden, wild fluctuations are completely out of character for stable systems. And the terrifying thing about breakdowns in smooth, laminar flows is that a chaotic, catastrophic breakdown soon appears.

snip>

But the slimy schemes of the Federal Reserve are one thing, the paranoid hallucinations of The Mogambo are another, while actual inflation is yet a third thing altogether, making, in all, three. And on that note, and because I don't want you to miss so much as a single syllable, I pick up my Mogambo High-Powered Megaphone (MHPM) and fairly scream through it "The JOC-ECRI Industrial Price Index jumped in July, rising to 130.17 from 128.18! That one-month gain of 1.6% in prices is a lot of inflation in one month! What is even more interesting, if you think that being eaten alive by inflation is 'interesting', is that the index is up from 108.95 a year ago at this time, which is an inflation rate of 19.5%!"

In an odd, almost tangential way, Frank Holmes, CEO and Chief Investment Officer of U.S. Global Investors, has a few words in the annual report, entitled "The Rise of The Chinese Consumer". He writes "China's energy consumption is expected to be 69 percent higher in 2010 than in 2002, according to the Federal Energy Information Administration. That growth rate is five times higher than the estimate for the United States and more than 15 times higher than Europe. China, in the midst of a massive infrastructure build-out, used half of the world's cement and 40 percent of the world's steel last year, according to government statistics."

more...

[Roland99]

25. Here's a link to that JOC-ECRI Industrial Price Index

http://www.joc.com/data/pricesindexes.shtml

The Journal of Commerce -- Economic Cycle Research Institute Industrial Price Index (JOC-ECRI IPI) is designed to yield a cyclical leading indicator of the inflation cycle. Cyclical turns in raw material price inflation, as measured by the growth rate of the JOC-ECRI IPI, anticipate cyclical turns in consumer inflation. Superior performance is achieved by the careful selection and combination of the components of the index, which is made up of a broad basket of the industrial commodities that have the best cyclical relationships with inflation. The foundation for the JOC-ECRI IPI is the work of Geoffrey H. Moore and his research staff, who have studied economic and inflation cycles for decades.

Index Annual Change (%) +15.20

Petro Annual Change (%) +39.06

:wow:

[54anickel]

26. Thanks Roland! n/t

[54anickel]

24. The Inflation Tax (Ron Paul)

http://www.house.gov/paul/tst/tst2006/tst071706.htm

All government spending represents a tax. The inflation tax, while largely ignored, hurts middle-class and low-income Americans the most. Simply put, printing money to pay for federal spending dilutes the value of the dollar, which causes higher prices for goods and services. Inflation may be an indirect tax, but it is very real- the individuals who suffer most from cost of living increases certainly pay a “tax.”

Unfortunately no one in Washington, especially those who defend the poor and the middle class, cares about this subject. Instead, all we hear is that tax cuts for the rich are the source of every economic ill in the country. Anyone truly concerned about the middle class suffering from falling real wages, under-employment, a rising cost of living, and a decreasing standard of living should pay a lot more attention to monetary policy. Federal spending, deficits, and Federal Reserve mischief hurt the poor while transferring wealth to the already rich. This is the real problem, and raising taxes on those who produce wealth will only make conditions worse.

Borrowing money to cut the deficit is only marginally better than raising taxes. It may delay the pain for a while, but the cost of government eventually must be paid. Federal borrowing means the cost of interest is added, shifting the burden to a different group than those who benefited and possibly even to another generation. Eventually borrowing is always paid for through taxation.

The third option is for the Federal Reserve to create credit to pay the bills Congress runs up. Nobody objects, and most Members hope that deficits don’t really matter if the Fed accommodates Congress by creating more money. Besides, interest payments to the Fed are lower than they would be if funds were borrowed from the public, and payments can be delayed indefinitely merely by creating more credit out of thin air to buy U.S. treasuries. No need to soak the rich. A good deal, it seems, for everyone. But is it?

more...

[54anickel]

56. Inflation's Sources Hard to Domesticate

Some economists say political risk and global commodity demand are pushing up prices. In that case, Fed rate hikes will have limited effect.

http://www.latimes.com/business/la-fi-inflation19jul19,1,6498529.story?coll=la-headlines-business

WASHINGTON — When Federal Reserve Chairman Ben S. Bernanke testifies about the economy to a Senate committee this morning, all eyes and ears will be on his view of inflation and any hints about whether he will keep raising interest rates to curb it.

But some analysts think the Fed wields less influence over inflation these days, making higher interest rates less effective as a tool to control it. They fear that further hikes could end up slowing the economy and hurting consumers without constraining prices.

Today's inflation, these economists believe, is driven substantially by the value of commodities and basic materials — oil as well as copper, aluminum, steel and others. That commodity inflation, they argue, is the result of forces largely beyond the scope of high U.S. interest rates: volatile politics in the Middle East, for example, and rising demand for materials from the rapidly growing economies of China and India.

"Most of our inflation is in commodities, and it is driven by global tensions and growth in foreign countries," said David Kelly, chief economist for Putnam Investments in Boston. "It's outside the reach of U.S. monetary policy."

more...

[Roland99]

63. Seems that's backed up by the JOC-ECRI data.

[54anickel]

27. Pentagon Budget Gimmickry - When a Cut is Actually an Increase

http://www.counterpunch.com/wheeler07142006.html

On Thursday, July 20, the Senate Appropriations Committee (SAC) is scheduled to "mark up" the fiscal year 2007 (FY 07) Department of Defense (DOD) appropriations bill. This "tutorial" anticipates what clearly appears to be one of the major budget gimmicks the SAC will employ. The gimmick will make it appear that a huge ($9 billion) cut is being made in the DOD bill, when in fact no such thing will be occurring.

The first hint appeared on June 22 when the Senate Appropriations Committee put out a press release on an arcane but important budget issue. The committee announced its "allocations" for FY 07. "Allocations" are nothing less than how much money each federal agency will get for the year from the Appropriations Committee--and ultimately Congress--in the form of "discretionary" spending (annual appropriations). The allocations are distributed to each of the 12 appropriations subcommittees that fund over 30 government agencies.

A few sharp reporters covered the SAC press release, noticing that the Republican-controlled committee was handing the DOD a substantial cut of over $9 billion compared to the amount President George W. Bush had requested for the fiscal year. One reporter even noted that the committee was, in effect, transferring that same amount to various non-defense agencies. (An extra $1.4 billion was distributed to the subcommittee that oversees the departments of Commerce and Justice, and NASA; the subcommittee for the departments of Transportation and Housing and Urban Development got an additional $2 billion; and the subcommittee for Labor, Health and Human Services, and Education got $5 billion more than the president requested. All of it coming out of DOD.)

It was an especially strange set of actions for the Republican-controlled committee after many of the same party members had just finished trashing the Democrats in the Senate chamber that same week for advocating that America "cut and run" from Iraq. If the Democrats had proposed a $9 billion cut in the defense budget, one can easily imagine the howls of "anti-defense budget-slashing Democrats" coming from many of the same Republicans who will almost certainly vote in favor of the measure to come out of the Appropriations Committee on July 20.

more...

[Roland99]

28. 10:08am - Holy Shit! Shooting for 11,000!

DJIA 10,922.41 +123.18 +1.14%
Nasdaq 2,066.73 +23.51 +1.15%
S&P 500 1,252.61 +15.75 +1.27%
Dow Util 425.05 +4.80 +1.14%
NYSE 7,998.25 +99.89 +1.26%
AMEX 1,887.58 +4.78 +0.25%
Russell 2000 697.31 +15.67 +2.30%
Semcond 411.78 +6.54 +1.61%
Gold future 629.50 UNCH UNCH
30-Year Bond 5.17% +0.01 +0.14%
10-Year Bond 5.13% UNCH UNCH

[Roland99]

30. Bernanke spoke. Don't have details on what he said but, DAMN

the markets love him today.

[stop the bleeding]

32. here are some details

MARKET SNAPSHOT

IBM, J.P. Morgan results boost the Dow
Core CPI shows inflation heating up; Bernanke testimony awaited
PrintE-mailDisable live quotesRSSDigg itDel.icio.usBy Mark Cotton, MarketWatch

Last Update: 9:47 AM ET Jul 19, 2006


NEW YORK (MarketWatch) -- U.S. stocks rose in early trading Wednesday as strong profit growth at J.P. Morgan Chase and International Business Machines boosted the Dow Jones Industrial Average, but shares of Yahoo Inc. tumbled after its results fell shy of analyst expectations.

Early gains comes as investors mull a consumer price report showing a pick-up in core inflation, and as Federal Reserve Chairman Ben Bernanke prepares to address Congress on the subject of the economy.
The Dow Jones Industrial Average ($INDU : Dow Jones Industrial Average
News , chart, profile, more

Last: 10,912.81+113.58+1.05%

10:14am 07/19/2006

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Sponsored by:
$INDU10,912.81, +113.58, +1.1%) rose 54 points to 10,853.
The Nasdaq Composite Index ($COMPQ : Nasdaq Composite Index
News , chart, profile, more
Last: 2,067.73+24.51+1.20%

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$COMPQ2,067.73, +24.51, +1.2%) gained 3 points to 2,046 while the S&P 500 Index ($SPX : S&P 500 Index
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Last: 1,252.80+15.94+1.29%

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$SPX1,252.80, +15.94, +1.3%) was up 7 points at 1,243. See full story.

"Bernanke has been prepared to say what he is going to say today for a while, but we're not going to like it," said Art Hogan, chief market strategist at Jefferies & Co. "Whatever the market does at the opening changes drastically once Bernanke starts talking at 10 o'clock."

Hogan said Bernanke's testimony comes just as the latest consumer price report shows inflationary pressures in the economy picking up.

Nevertheless, said Hogan, "the overriding concern is the geopolitical tension in the Middle East."
Hogan said you have conflicting reports on the conflict with some saying Israel can get this wrapped in a couple of weeks, while others suggest it could still take some time.

The BBC, quotes a senior Israeli commander, Gen. Alon Friedman, as saying that it could takes weeks to see a turning point in the fighting.

On Tuesday, stocks ended higher helped by a retreat in crude-oil prices and some solid earnings reports from United Technologies and Coca-Cola among others, but the volatile situation in the Middle East combined with unsettling inflation and housing data left investors in an uncertain frame of mind.

Investors were dealt a body blow on the economic front as the latest data revealed higher inflation and a cooling housing market, stoking concern the economy may be slowing down.

U.S. consumer prices increased a moderate 0.2% in June, the smallest gain in four months, but core inflation rose 0.3% for the fourth straight month. The core rate is now up 2.6% in the past year, a bit higher than the Federal Reserve is thought to be comfortable with. See full story.

The retail inflation report dampened hopes that Federal Reserve Chairman Ben Bernanke will signal a pause in interest-rate increases in congressional testimony set to begin Wednesday. The Federal Reserve has raised its key short-term interest rate seventeen times in a row in a bid to slow economic growth and choke off inflation. Its fed-funds rate currently stands at 5.25%.

In further confirmation that the housing market is cooling off, builders began new housing construction at a slower rate in June, the Commerce Department said Wednesday, as the number of building permits issued also continued to decline.

http://www.marketwatch.com/news/story/Story.aspx?guid=%7B9825CE67%2D4390%2D4E8E%2D8F5A%2DA8327186ADE4%7D&siteid=

[Roland99]

35. They've added more detail on what he said:

"The comments that just got released from Bernanke that he is mindful of the lags points to at least the fact that he may pause come August," said Paul Nolte, director of investments at Hinsdale Associates, referring to remarks by the Fed chief that previous interest-rate hikes have not yet fully filtered through into the economy.

In prepared testimony to Congress, Bernanke said inflation risks remained and the central bank was concerned about rising prices. But he said the economy was likely to slow and this should ease inflation pressures. He also said the full impact of past rate hikes have yet to hit the economy. The formal testimony fits with the rough consensus of economists who had thought that Bernanke would try to preserve the Fed's flexibility to either continue to hike rates or pause in August, depending on the central bank's interpretation of the latest economic data.

[stop the bleeding]

38. when are the minutes released from the last meeting, has that

happened yet?

[Roland99]

40. not sure on that.

[54anickel]

41. Tomorrow, but I'm not sure what time. Think it's usually in the afternoon?

The Fed tomorrow will release minutes of the last meeting, held on June 28-29.

http://www.bloomberg.com/apps/news?pid=20601087&sid=arNhWDdx5wcw&refer=home

[54anickel]

34. Fed's Bernanke warns inflation costly to reverse

http://today.reuters.com/business/newsarticle.aspx?type=tnBusinessNews&storyID=nWAT006066&imageid=&cap=
WASHINGTON, July 19 (Reuters) - Federal Reserve Chairman Ben Bernanke warned on Wednesday stubbornly high inflation could harm the U.S. economy and that the U.S. central bank must guard against rising prices taking hold.

Bernanke said while the Fed was forecasting cooler economic growth and some moderation in inflation next year, the central bank remained worried about pricey oil and tight labor markets and the risk they might foster expectations for rising prices.

"Persistently higher inflation would erode the performance of the real economy and would be costly to reverse," Bernanke said in testimony prepared for delivery to the Senate Banking Committee. "The Federal Reserve must take account of these risks in making its policy decisions."

The Fed chief, who took office Feb. 1, issued the stern inflation warning as he presented the central bank's twice-yearly report on monetary policy and the economy.

He said the economy appeared to be "in a period of transition" to more moderate growth from a swift advance earlier in the year. He said this should gradually help ratchet down some of the price pressures the economy was facing.

more...

[54anickel]

36. Fed chief: Oil may make inflation worse

http://www.chron.com/disp/story.mpl/ap/business/4057287.html

snip>

Delivering his second economic report to Capitol Hill, Bernanke also stressed that these are difficult and uncertain times for Fed policy-makers, saying the climate of slowing growth and rising inflation puts the Fed in a tricky spot in terms of setting interest rates.

"The recent rise in inflation is of concern" to Fed policy-makers, Bernanke said in prepared remarks to the Senate Banking Committee. He said that possible increases in the prices of oil as well as other raw materials "remain a risk to the inflation outlook."

"Persistently higher inflation would erode" the economy's performance "and would be costly to reverse," Bernanke added. "The Federal Reserve must take account of these risks in making its policy decisions."

On the other hand, a slowing economy should reduce inflation pressures going forward, he indicated. A slowing housing market and more cautious consumers _ whose spending accounts for a big chunk of economic activity _ are the main factors behind the moderation in overall economic growth, Bernanke said.

But he also left the door to further increases...

more...

[54anickel]

39. European shares jump 1.3 pct on Bernanke comments

http://today.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?view=CN&storyID=2006-07-19T141354Z_01_L19630934_RTRIDST_0_MARKETS-EUROPE-STOCKS-URGENT.XML&rpc=66

LONDON, July 19 (Reuters) - European shares jumped over 1 percent on Wednesday after U.S. Federal Reserve Chairman Ben Bernanke said he expected U.S. core inflation to decline.

Bernanke said in testimony prepared for delivery to the Senate Banking Committee that while the Fed was forecasting cooler economic growth and some moderation in inflation next year, it remained worried about pricey oil and tight labour markets.

Europe's FTSEurofirst 300 index <.FTEU3> of top shares was 1.3 percent up at 1,287.7 by 1410 GMT. Germany's DAX <.GDAXI> jumped 1.7 percent, France's CAC 40 <.FCHI> was 1.4 percent higher and Britain's FTSE 100 <.FTSE> was 0.8 percent up.

bit more...

[54anickel]

47. Dow Shoots Up After Bernanke Comments

http://biz.yahoo.com/ap/060719/wall_street.html?.v=9

Dow Industrials Jump 100 on Comments by Fed Chief Bernanke That Inflation Remains Contained


NEW YORK (AP) -- Stock prices rallied Wednesday on remarks from Federal Reserve Chairman Ben Bernanke that economic moderation "now seems to be under way" and that inflation remains contained. The Dow Jones industrial average shot up more than 100 points.

snip>

Investors expected Bernanke to give more signals of an end to the Fed's streak of interest rate hikes as he continued testimony before Congress during the trading session.

Two government reports indicated that the economy is slowing. The Labor Department said the Consumer Price Index rose by just 0.2 percent in June, the smallest increase in four months, but core inflation, which excludes energy and food, rose by 0.3 percent in June, higher than the 0.2 percent Wall Street expected. That increase left core inflation rising for the past three months at an annual rate of 3.6 percent, far above the Federal Reserve comfort zone of 2 percent or less.

Meanwhile, the Commerce Department said construction of new homes fell by 5.3 percent in June, another sign that the once-booming housing market is slowing.

[Roland99]

52. So, no more rate hikes (which was already assumed?!?!) causes a jump??

Gold up, bond prices down, stocks up all on just Chopper Ben's words and not economic fundamentals.

The markets are just looking for ANY type of good news to latch onto.


Very dangerous, imo.

[54anickel]

57. JMHO, but I think we're seeing some great intervention going on...

We got just the bump we needed to stay within support (in spite of rising ME tensions) and now Ben's done his verbal intervention at the perfect time to break up thru resistance and build some momentum. But again, I'm one of those :tinfoilhat:

[Roland99]

58. The well-funded faeries just weren't doing the job so ol' Ben had to help.

[54anickel]

59. Ben's just inviting everyone back into the water, just kicking things off.

The buying begets more buying until it begins to feed upon itself. But, every buyer needs a seller....wonder how many naked shorts are swimming today? :evilgrin:

[newportdadde]

61. Inflation contained? No more rate hikes? I'll believe it when I see it.

Sorry I'm not buying it, all I see here is Bernie doing his best to prop a market that so badly wants to do a slow bleed off.

I still see an August rate hike.

[54anickel]

49. TEXT-Bernanke's prepared testimony on the U.S. economy

http://today.reuters.com/business/newsarticle.aspx?type=tnBusinessNews&storyID=nN19281603

[54anickel]

31. Hmmm, auto buys triggered by the break above 10,900 resistance?

Waiting for the sound of fingernails scraping as it slides back toward resistance. Wait to see what Ben has to say today - he may just give it the boost it needs. A bit of verbal intervention has gone a long way in the past at such crucial turning points.

on edit - damn! I type to slow!!!

[54anickel]

37. U.S. Stocks Rise After IBM, JPMorgan Chase Report Higher Profit

http://www.bloomberg.com/apps/news?pid=20601087&sid=aNx6yegRpZSk&refer=home

July 19 (Bloomberg) -- U.S. stocks rose after profit from International Business Machines Corp. and JPMorgan Chase & Co. exceeded analysts' estimates, spurring optimism earnings growth will weather rising borrowing costs.

The reports overshadowed government data on consumer prices that signaled the Federal Reserve may continue raising interest rates. Investors may get further clues about the central bank's outlook on inflation from Fed Chairman Ben S. Bernanke's testimony to Congress today.

Financial shares led the Standard & Poor's 500 Index higher and were the top gainer among 10 industry groups in the index.

The S&P 500 index advanced 6.67, or 0.5 percent, to 1243.53 at 9:45 a.m. in New York. The Dow Jones Industrial Average added 54.75, or 0.5 percent, to 10,853.98. A plunge in Yahoo! Inc. shares held back the Nasdaq Composite Index, which added 4.43, or 0.2 percent, to 2047.65.

Stocks have fallen 2.6 percent this month as oil prices hit a record, fighting broke out in the Middle East and second- quarter profit growth trailed some estimates as higher costs took a toll on companies.

[Roland99]

42. 10:38am - Still climbing

DJIA 10,930.34 +131.11 +1.21%
Nasdaq 2,066.08 +22.86 +1.12%
S&P 500 1,253.27 +16.41 +1.33%
Dow Util 424.84 +4.59 +1.09%
NYSE 8,018.54 +120.18 +1.52%
AMEX 1,893.69 +10.89 +0.58%
Russell 2000 697.48 +15.84 +2.32%
Semcond 410.93 +5.69 +1.40%
Gold future 637.00 +7.50 +1.19%
30-Year Bond 5.13% -0.04 -0.68%
10-Year Bond 5.09% -0.04 -0.84%

[Tace]

33. MOGAMBO GURU: Like Dead Bugs On The Floor

Richard Daughty, the angriest guy in economics -- World News Trust

The policeman was yelling through the megaphone, "What are you so mad about, Mogambo? Come out of the famed Mogambo Bunker (MB), nice and quiet, with your hands up, and let's talk about it!"

So I fire off another burst of machinegun fire over their heads to recapture their attention, and shout through the gun port, "Don't pretend you don't know about how the Federal Reserve reversed course from their previous outsized $11 billion injection of credit into the banking system, you stinking lying cop! So don’t insult me by acting like you were completely unaware that Total Fed Credit fell by $6 billion last week!"

As I am jamming home a fresh clip of ammo, I shout, "And what about Japan finally raising interest rates from zero to 0.25%? Rates have been zero for six years, you idiot Gestapo pig!" I squeeze of another long burst.

How could I explain to this government goon squad about the strange and scary perturbations in the flow of economics? Can they even be made aware of such things as the frightening levels of activity in the bank repo market, where $11 billion per day is now expected! With spikes into the high $20s of billions! Per day!

more

http://worldnewstrust.org/modules/AMS/article.php?storyid=3927

[54anickel]

43. A Requiem for Pensions

http://www.msnbc.msn.com/id/13530778/site/newsweek/

July 3-10, 2006 issue - Younger workers would rather invest in 401(k)s (pensions carry a musty smell). At retirement, older workers often reject their plan's offer of a monthly income for life in favor of taking a lump sum to invest themselves. Hundreds of companies have closed or limited their plans in recent years, switching to 401(k)s instead. Most tech firms, among others, never offered them in the first place.

That's too bad, because guaranteed lifetime incomes shouldn't be thrown away lightly. They can offer better returns than you'll ever get from your investments, and more personal security, too.

snip>

You don't want to know the bill's technical details (trust me on this!). In brief, the reforms require firms to put more money into their plans. Underfunded plans will have to make up their shortfalls faster. There will also be changes in the way all companies calculate how much they owe. In 2005, the industry Committee on Investment of Employee Benefit Assets asked pension executives what they'd do if at least two of the provisions passed. Sixty percent said they'd freeze their plans. "Private pensions are going the way of the dodo," says David Wyss, chief economist for Standard & Poor's. "The more that's required of plans, the sooner they'll go extinct," along with the future benefits of 17 million workers.

snip>

Pension plans also earn more on their investments than a typical 401(k) due to better management and lower expenses. "We're moving from an efficient retirement system to a less efficient one," says Watson Wyatt's Kevin Wagner. It's a loss.

But that's only if you're a working stiff. Top executives are not only keeping their pensions, their payoffs are leaping even as yours are being pared. Tough luck. Today, the money flows to the "deserving rich."

[Sammy Pepys]

46. "Younger workers would rather invest in 401(k)s..."

In a lot of ways, I don't blame them. The dynamic of work has changed. People don't stay with the same company their entire working lives anymore. To be fully vested in my pension plan, which is very generous, I have to stay at my current place of employment for at least two more years (probably more like one and a half in reality). I don't know if that's going to happen. And while it's free money (I don't pay for a cent of it), if I had had even 50% matching on a 401(k) on the contributions I made I'd walk away with more than double the amount that's been put into my pension by my employer.

[shrike]

54. A lot of people have found out the hard way

just how valuable those musty pensions can be.

One swipe from the market can wipe away all the "value" your 401k has built up over the years. I've seen it happen; to many people. A pension, OTOH, used to be a guaranteed benefit, and there's a lot to be said for guarantees.

[Sammy Pepys]

62. Well, it depends on what...

..your 401(k) is invested in and what kind of matching benefit you have. Matching benefits are a key piece of insulation against market drops. If you get a 100% on 401(k) contributions (which is not unusual), you've got a built-in gain already. Even if you lost 50% of the value of your 401(k), you're technically stillbreaking even on the money you've contributed.

Pensions have their own problems, as we've seen. They are not in fact guaranteed benefits. The PBGC can't even keep up with the number of pension defaults occurring today...they're on the verge of going broke.

[shrike]

64. Yes, but it didn't used to be that way

And it doesn't relieve corporations of the moral and financial obligations they have abdicated. But that's a whole other issue:

And btw, breaking even is not good enough. If I had a dime for every person I knew who was riding high on a 401k, only to lose their paper profits and part of the principal, I'd be rich.

Ah yes, "Wait for it to come back in a few years." And as the years go by, maybe it does -- and maybe it doesn't. I know people who are still waiting to earn back their losses from years ago. And even if it does, that's years of potential profit that you've lost. Look at it this way: If you'd never invested in the market and put that original amount in the bank, gaining five percent interest over the same time period, you'd be ahead of the guy who rode high on the stock market and then lost his ass. It's called compound interest.

I'm not saying you should keep all your money in the bank. Or that pensions will magically come back. I'm just saying you should be realistic -- and know what and who you're dealing with.
I have stock like everybody else and my latest "toy" is having fun with international funds; my China fund has shot the moon. But I've been around a while -- longer than you have, I bet -- and I take what the so-called financial advisors tell me with a grain of salt, even the one I've employed for years, as good as she is. Because there's too much volatility, too much that can happen. Too much that can go wrong. (In life as well as the stock market -- serious illness, job loss, bankruptcy.) And you've got to be light on your feet and conservative with at least some of your investments.

And btw, I wish I could remember the link for a fellow who regularly appears on PBS. He thinks Americans are getting snookered with 401ks, mainly because of the fees involved. (Musty old pension funds didn't have them, you see.) Mutual funds -- according to him -- have all sorts of hidden fees that by law their managers do not have to reveal to you. All those fees on your statement: those are the ones they HAVE to tell you about. According to him, $1,000 invested in a mutual fund, considering an average rate of interest, will earn $140,000 over 30 years. Sounds nice, doesn't it. Thing is, over 30 years you will also pay an average of $110,000 in fees. Meaning YOU end up with $30,000. Mutual funds and 401ks, he says, are a way for the financial services industry to make money. Ergo, he says, mutual funds should be a short-term investment only -- the longer you leave them in, the more fees you pay.

Anyway, sorry for the lecture, but hey, don't be too trusting and keep a close watch on that 401k, dude. Trust me, I've seen it all, and it ALL can happen.

[Sammy Pepys]

66. All I'm saying is...

..it's pretty evident why 401(k)s are more attractive to younger workers.

And like I said, I don't have a 401(k). I have a pension ;) I do have a Roth IRA as well, but that is all my own money.

PS - You're thinking of Robert Kyosaki. He's alright, but I'm more of a Ric Edelman/Ray Lucia guy. Kyosaki's a little too into metals and real estate for my taste.

[shrike]

78. Good on you

For the pension. My hubby's a pensioner at the moment and he brings home $2,200 a month after taxes and health premiums. Not too shabby. He didn't get into the Roth/401k thing in time, but that might not have been a bad thing because the tech bubble popped right when he retired and everyone we knew lost their asses. Timing is everything . . .

I thoroughly agree that 401ks do look more attractive to younger workers and I fully understand the reason why. (I also remember feeling that way myself, when I was that age.) But Kyosaki aside, I hope younger workers will not be lulled into complacency the way (many) pensioners were in generations past: a lot of folks just assumed the company would do right by them. Today, I think (some) younger workers assume the stock market will give them the returns they're told it will give them and "trust" the fund managers and financial community the way their parents and grandparents once trusted their employers.

My philosophy is, if you're going to manage your own retirement, then by God, manage it. Pay attention. For the record, I have no pension other than the one I'm building me. I'm self-employed and am doing the SEP-IRA thing, plus other investments. So I read everything I can get my hands on. Right now I figure I'm way overloaded on "safe" investments, so from now on all the new money I'm setting aside is going into the higher-risk stuff, like mutual funds and overseas . . .

[antigop]

102. RE: Younger workers would rather invest in 401(k)s

Go out and get yourself a copy of "The Great 401(k) Hoax".

Get it. Read it. Understand it.

[54anickel]

104. Business Week ran some excerpts from it a while back. It's a good read!

Some excerpts for a sampling....

http://www.businessweek.com/magazine/content/02_30/b3793639.htm
An Excerpt from The Great 401(k) Hoax

http://www.businessweek.com/bwdaily/dnflash/oct2003/nf20031015_0259_db042.htm
The Great 401(k) Hoax, Continued

[Roland99]

53. 11:07am - Almost to 11,000!

DJIA 10,961.08 +161.85 +1.50%
Nasdaq 2,070.23 +27.01 +1.32%
S&P 500 1,255.85 +18.99 +1.54%
Dow Util 425.51 +5.26 +1.25%
NYSE 8,038.62 +140.26 +1.78%
AMEX 1,900.08 +17.28 +0.92%
Russell 2000 697.86 +16.22 +2.38%
Semcond 413.07 +7.83 +1.93%
Gold future 643.00 +13.50 +2.14%
30-Year Bond 5.14% -0.03 -0.50%
10-Year Bond 5.10% -0.04 -0.68%

[54anickel]

60. 11:58 pre lunch check Then I gotta run off to work

Dow 10,950.75 +151.52 (+1.40%)
Nasdaq 2,071.49 +28.26 (+1.38%)
S&P 500 1,254.56 +17.70 (+1.43%)
10-yr Bond 5.077 -0.053 (-1.03%)
30-yr Bond 5.117 -0.045 (-0.87%)
NYSE Volume 1,195,050,000
Nasdaq Volume 1,044,027,000

11:30 am : Market continues to motor higher as investors listen closely to the Q&A portion of Bernanke's semi-annual testimony. Most recently, the Fed Chairman has acknowledged that the Fed must get off its 25 bps automatic rate hike "escalator" to a point of more flexibility. He also reiterated his goal of achieving sustainable expansion and that he does not want to overtighten to contain price pressures, which further supports a potential pause at the Fed's next meeting. To wit, fed funds futures, which were implying a roughly 90% chance of another 1/4% rate hike on August 8th following the CPI report, are back to pricing in about a 68% chance of an 18th consecutive increase and are no longer pricing in any hikes at the three FOMC meetings thereafter. DJ30 +167.21 NASDAQ +29.96 SP500 +19.20 NASDAQ Dec/Adv/Vol 593/2181/918 mln NYSE Dec/Adv/Vol 472/2609/702 mln

11:00 am : Onward and upward remains the driving mantra this morning as stocks are trading higher across the board. Providing an additional source of support within the last 30 minutes was a spike lower in oil prices below $73 per barrel following unexpected builds in weekly gasoline and crude oil inventories. With Bernanke recently saying that "much of the upward pressure on overall inflation this year has been due to increases in the prices of energy," the pullback in crude has been welcome news for a market that has been dramatically oversold over the last few weeks due to such concerns.DJ30 +149.84 NASDAQ +25.21 SP500 +18.31 NASDAQ Dec/Adv/Vol 534/2162/754 mln NYSE Dec/Adv/Vol 489/2521/572 mln


Heh-heh, you'd think there was an election coming up or sumptin :evilgrin:

[swag]

65. Fund manager pessimism hits record

http://www.dailyii.com/article.asp?ArticleID=1047944&LS=EMS100766

Fund Managers Turn Dramatically Pessimistic
07/18/06
DailyII.com

In just three months, the outlook on the global economy has gone from 5% of fund managers being pessimistic about the next 12 months to 60% having a dim view of the coming year, according to Merrill Lynch’s Survey of Fund Managers for July. “This survey is so grim it could constitute a contrarian signal,” says Dave Bowers, a Merrill spokesman. “High cash levels, high risk aversion and extreme pessimism about growth are the raw ingredients for a stock market rally if we get the merest pinch of good news to add to the mix.” As dire as the survey sounds – Merrill says it is its most negative in its history – few believe there will be a “full-blown recession” within the next 12 months. About one in three institutional investors are overweight in cash, a level exceeded only after Sept. 11.

, , ,

[Roland99]

67. 1:31pm - (Stephen Colbert mode) WOOOOO!!! WOOOOOO!! WOOOOOO!!!

DJIA 10,994.55 +195.32 +1.81%
Nasdaq 2,081.16 +37.94 +1.86%
S&P 500 1,258.88 +22.02 +1.78%
Dow Util 425.77 +5.52 +1.31%
NYSE 8,066.96 +168.60 +2.13%
AMEX 1,909.36 +26.56 +1.41%
Russell 2000 700.48 +18.84 +2.76%
Semcond 417.68 +12.44 +3.07%
Gold future 643.00 +13.50 +2.14%
30-Year Bond 5.11% -0.06 -1.10%
10-Year Bond 5.06% -0.07 -1.35%

[stop the bleeding]

68. look at a daily chart of the DJIA for the past 6 months

notice it's peak back in may, and then a rally with a peack around June 1st, and then another rally/peak around July 1st. Notice how each time the peaks are lower than previous peaks. We are getting close to 11K, and we are back above the 200MA.

Oversold as you said earlier, makes me wonder how the last few hours will go along with the last few days of this week, profit taking is gonna kick in soon for today and for the week. Also we are right on schedule to put another rally in that will peak around the beginning of August - question is - will it be higher or lower than previous highs?

on edit: @ 1:26pm we touched 11001 on the DJIA

[ozone_man]

70. A descending triangle.

My guess is that it will break to the low side, through 10,700 by early August.

BTW, what happened to rising oil prices and the war in the ME? Why does it explain market movements on one day, but not another?

When we get down to 10,000, we can look back at this day with a chuckle. :)

[stop the bleeding]

73. Oil has a built in price of 69-73$/barrel

why everyone thought that everything is fine is beyond me(when it dropped below $76) - cause this price reflects the true demand/supply of oil. The ME is a factor but not as much as everyone "thinks" it is.

I have been keeping a bearish outlook ever since we had the head and shoulders form on the major indexes back in May. So today's buying is "over exuberant" also as Roland said the market has been oversold the last few days, so today is a temporary thing.

I also believe that Ben's vernacular today is no more clear than it has been the last few times, So I expect another hike before the end of the year, with a 50/50 in August.

The rising costs of materials and energy is going to eat into earnings for the 3rd and 4thQ's, with most of the Xmas spending going into the gas tanks now, also when you look at the WalMart consumer you can see where this is going.

All of these have been playing into my bearish strategy.

[Roland99]

74. Notice how the M$M is very quiet on passed-on costs?

A few years ago when gas first started rising above $1.75 or $2.00, we'd hear about FedEx or UPS or Delta or whomever adding on fuel surcharges. I'm sure those companies aren't feeling charitable with gas over $3/gal.

[Roland99]

72. 2:11pm - 11,003 .. .+204

[Roland99]

80. 2:40pm - 11,021 ... +222

[specimenfred1984]

69. Fed Speaks, Fed Pumps: Fascist America

"Investors" wouldn't buy stocks because the economy is slowing down, this is pure big bank speculation courtesy of no laws and regulation.

The biggies are trying to save their butts from going under due to excessive speculation in everything imaginable.

[Clarkie1]

71. We have seen the test of the 2006 low come and go.

Expect to see the S&P trade in at least the mid-1300s by year's end.

Glad I bought Monday. :-)

[stop the bleeding]

75. the low has been tested on the S&P as well as the DJIA, but the

NASDAQ is still trying to find the bottom.

All of them are putting in lower swing highs, so I will have to wait for better conformation of some actual follow through(breaking previous resistance) and not just a bunch of range trading.

I do hope we can get out of this, cause it sure is a heck of alot easier to spot "good" long plays than to spot the "short" ones.

Either way as long as the market moves I am happy and profitable.

1350 by the year's end. You'll have to take us out for drinks if we get there. ;)

[specimenfred1984]

76. Based on What Expectations?

A short-term double bottom on the daily chart? A yapping Fed that's a propaganda mouthpiece? I'm all for a bull market if it really exists but this one-day pump doesn't convince me, especially since the daily S&P hasn't even broken above of it's downtrend line.

These markets are totally corrupt, they could just as easily go up as down but, the people manipulating these markets are in deep financial trouble, they will need their assets to cover lots of losses. They could just as easily pull out of longs in the S&P which they usually do after a fraudulent Fed pump like today.

[Sammy Pepys]

79. I wish I had bought more...

I had a few extra bucks lying around so I decided to pick up some shares...wish I had dumped a few more bucks.

I think you're right about the low basically being tested and raised. It might not shoot up like a rocket from here, but I think we'll move up a bit steadier through the end of the year.

[Roland99]

86. If I had bought on Mon., I'd have sold today

;)

[Sammy Pepys]

93. No such luxury

Mutual fund investor.

[Roland99]

77. 2:30pm - Bush issues FIRST veto in presidency

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2399420

[UpInArms]

81. Good Grief! I go away for a morning and come back to see

the irrational exuberance in the markets and the irrational stupidity of the Dimson.

:crazy:

[Roland99]

82. Oh, so it's YOUR fault!

:mad:





:D :D

[UpInArms]

83. market statistics

2:36 PM ET 7/19/06 NYSE VOLUME 1.3B

2:36 PM ET 7/19/06 NASDAQ VOLUME 1.7B

2:36 PM ET 7/19/06 NYSE HAS 2,809 ADVANCERS

2:36 PM ET 7/19/06 NYSE HAS 486 DECLINERS

2:36 PM ET 7/19/06 NYSE HAS 101 ISSUES UNCHANGED

2:36 PM ET 7/19/06 NASDAQ HAS 2,286 GAINERS

2:36 PM ET 7/19/06 NASDAQ HAS 707 LOSERS

2:36 PM ET 7/19/06 NASDAQ HAS 85 ISSUES UNCHANGED

2:36 PM ET 7/19/06 NYSE HAS 52 ISSUES SETTING 52-WEEK HIGHS

2:36 PM ET 7/19/06 NYSE HAS 33 ISSUES SETTING 52-WEEK LOWS

2:36 PM ET 7/19/06 NASDAQ HAS 31 ISSUES SETTING 52-WEEK HIGHS

2:36 PM ET 7/19/06 NASDAQ HAS 38 ISSUES SETTING 52-WEEK LOWS

[wordpix2]

84. 2:52 numbers---investors going "YaHOO!"

Dow 11,023.11 +223.88
Nasdaq 2,084.39 +41.17
S&P 1,260.32 +23.46
10-Yr Note 100.50 +0.59

2:52 PM

[Roland99]

85. 11,035.28, +236.05, +2.2%

[UpInArms]

88. blather round-up

2:30 pm : Major averages extend their reach to the upside as buying remains widespread across most areas. On the Dow, 29 of its 30 components are trading higher, led by JP Morgan's (JPM 42.95 +2.24) 5.5% surge, while 91 of the Nasdaq 100 are posting gains. Among those on the latter not benefiting from the significant improvement to underlying sentiment following Bernanke's dovish remarks, aside from the downturn in Internet Services fueled by Yahoo's (YHOO 25.41 -6.83) disappointment, are eBay (EBAY 25.69 -0.90) and Qualcomm (QCOM 37.11 -0.29) -- both of which report results after the close. DJ30 +212.51 NASDAQ +40.71 SP500 +22.89 NASDAQ Dec/Adv/Vol 704/2285/1.67 bln NYSE Dec/Adv/Vol 483/2788/1.29 bln

2:00 pm : Indices are off their best levels but market internals continue to suggest that a bullish bias remains firmly intact. As reflected in the A/D line, advancers outpace decliners by at least a 3-to-1 margin at both the NYSE and Nasdaq while a 4-to-1 ratio of up to down volume also signals that a short-term bottom has been put in place. Above average volume is also lend some conviction behind today's broad-based rally.DJ30 +186.52 NASDAQ +33.94 SP500 +20.51 NASDAQ Dec/Adv/Vol 663/2288/1.53 bln NYSE Dec/Adv/Vol 481/2757/1.17 bln

1:30 pm : Market breaks out of its afternoon range as a renewed wave of buying sends the indices to fresh session highs. Having recently broken through key resistance levels, the Dow and S&P 500 are now up 1.8% on the day while the Nasdaq, recently surpassing resistance around the 2080 mark, is also turning in a 1.8% performance. It is worth noting that all three indices rising in synch with one another, and turning in relatively the same performances (+1.8%), implies that program trading is also contributing to the broad-based moves to the upside.DJ30 +194.15 NASDAQ +36.59 SP500 +21.89 NASDAQ Dec/Adv/Vol 649/2280/1.42 bln NYSE Dec/Adv/Vol 493/2729/1.09 bln

1:00 pm : Little changed since the last update as the indices continue to vacillate in roughly the same ranges. Bonds, however, continue to hit fresh session highs. After initially selling off following a larger than expected read on core CPI, which raised concerns that the Fed has further to go, Bernanke's dovish commentary has sidelined such worries and continues to underpin a floor of support for Treasuries. The yield on the 10-yr note was as high as 5.17% but is now back at 5.06%, up as many ticks (16) as it was down yesterday, which is lending even more support for the rate-sensitive Financials sector. DJ30 +154.60 NASDAQ +28.43 SP500 +18.17 NASDAQ Dec/Adv/Vol 683/2215/1.28 bln NYSE Dec/Adv/Vol 529/2658/986 mln

12:30 pm : No real change in sentiment as the afternoon session gets underway and buyers remain in complete control of the action. In fact, of the 147 S&P industry groups, only nine are currently posting losses. IT Consulting & Services (-12.9%) is turning the worst performance after Unisys (UIS 5.36 -0.79) reported a wider than expected Q2 loss. Internet Software & Services (-6.3%) ranks second as a 20% sell-off in Yahoo (YHOO 25.70 -6.54) to a 52-week low amid an 80% decline in profits raises concerns about Google's (GOOG 395.28 -7.77) upcoming Q2 report tomorrow afternoon. Specialized Financials has been the only other noticeable sore spot after CIT Group (CIT 47.70 -3.70) said Q2 net income fell 5%. DJ30 +153.04 NASDAQ +25.45 SP500 +17.60 NASDAQ Dec/Adv/Vol 652/2232/1.17 bln NYSE Dec/Adv/Vol 538/2629/910 mln

12:00 pm : Stocks remain in rally mode midday as dovish commentary from Fed Chairman Bernanke pushes bonds yields to session lows and allows equity investors to look beyond disappointing CPI data and embrace strong earnings news amid another pullback in oil to get back into a market that has been dramatically oversold.

Even though June core CPI was extremely disappointing, up 0.3% for the fourth straight month to leave the year-over-year increase at 2.6%, which is well above the Fed's comfort zone of 1.75-2.00%, upbeat remarks from Bernanke have superseded a report, albeit typically much more influential, largely impacted by continued strength in the rental equivalency measure for home ownership.

At his semi-annual testimony before the Senate Banking Committee, Bernanke has said that the Fed must get off its 25 bps automatic rate hike "escalator" to a point of more flexibility, suggesting there is room for moderation in the current rate hike cycle, and called for a "gradual decline in inflation in coming quarters" -- all of which have renewed enthusiasm for stocks across the board. The optimism of a possible pause has been further echoed in fed funds futures, which were implying a roughly 90% chance of a 1/4% rate increase to 5.50% on August 8th following the CPI report, but are back to pricing in only a 68% chance of another hike and are no longer pricing in any tightening at the three FOMC meetings thereafter.

Of the nine sectors trading higher, the most influential of them all -- Financials -- is pacing the way to the upside. The sector has surged more than 2.5% and is back in positive territory for the year after J.P. Morgan Chase (JPM 42.06 +1.35) said Q2 net income more than tripled and retail banking earnings at Bank of America (BAC 49.01 +0.57) doubled. Health Care is also turning an intraday gain of at least 2.0% after UnitedHealth (UNH 50.66 +2.26) and Abbott Labs (ABT 45.80 +1.10) both beat analysts' Q2 forecasts and raised their full-year profit outlooks.

Even Technology, which was under pressure early on after Yahoo (YHOO 25.55 -6.69) merely matched forecasts as Q2 profits fell 80% on lighter than expected sales, has attracted bargain hunters. A big reason for renewed support for tech stocks, which will be in the spotlight after the bell following EPS reports from bellwethers like INTC (+1.1%), MOT (+2.3%), AAPL (+0.3%), QCOM (-2.0%), and EBAY (-1.8%), has been International Business Machines (IBM 76.54 +2.28), which beat estimates by a penny last night.

Energy is the only sector failing to participate in today's rally, as another 2.0% drubbing in oil prices provide an opportunity for investors to lock in some of the sector's leading 13% year-to-date surge and rotate into underperforming areas like Tech and Health Care. With Bernanke recently saying that "much of the upward pressure on overall inflation this year has been due to increases in the prices of energy," crude oil futures slipping below $72 per barrel, following unexpected builds in weekly gasoline and crude oil inventories, has also been weclome news for a market reeling from weeks of broad-based losses due to such concerns. BTK +2.2% DJ30 +150.72 DJTA +1.0% DJUA +0.9% DOT +0.6% NASDAQ +28.38 NQ100 +0.8% R2K +2.3% SOX +2.0% SP400 +1.7% SP500 +17.67 XOI -0.3% NASDAQ Dec/Adv/Vol 597/2224/1.04 bln NYSE Dec/Adv/Vol 522/2612/810 mln

[Roland99]

90. "program trading"...Ron Paul on Tom Hartmann tomorrow (money supply)

Ron Paul will be talking about how the Fed has greatly increased the money supply over the last few years (which, essentially, has been the growth in GDP)

[UpInArms]

92. more soothing crickets chirping blather

3:00 pm : More of the same for stocks as short sellers continue to run for cover. Underscoring some of the optimism behind today's widespread buying efforts have been declines in both the VIX (CBOE Volatility Index) and the VXN (NASDAQ Volatility Index) to their lowest levels in several days. Weakness in what are commonly referred to "investor fear gauges" suggests a bottom has formed and that investors are buying options in anticipation of further appreciation in stocks. To wit, the Dow's 232-point advance currently positions the blue chip index for its best one-day gain of the year. The last time investors rallied around the idea that the Fed may finally take a breather after two years of interest rate increases was on June 29th, when the Dow closed up 217 points after the Fed raised rates for a 17th consecutive but, in the wording of the policy statement, left the door open for a pause at the next FOMC meeting in August. DJ30 +232.11 NASDAQ +41.53 SP500 +24.03 NASDAQ Dec/Adv/Vol 663/2328/1.82 bln NYSE Dec/Adv/Vol 479/2801/1.40 bln

[UpInArms]

91. Assistant Treasury Secretary Warshawsky resigning

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BE4E564F8%2DA0A6%2D4EF6%2DA057%2D6FC64DD25409%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Mark Warshawsky, the Treasury Department's assistant secretary for economic policy, is resigning effective July 28 to return to the private sector, the Treasury said Wednesday. Warshawsky, who worked on Medicare and Social Security reform in addition to terrorism risk insurance and pension reform, will join Watson Wyatt Worldwide, a global human capital consulting firm. He submitted his resignation letter to President Bush on July 6.

[stop the bleeding]

94. 211 points on DJIA

let's celebrate ;)

[Roland99]

95. Closed above 11,000 - Break out the bubbly!!

Don't have the final numbers, though.

[stop the bleeding]

96. My lady is graduating tomorrow with a BS degree from USF

the bubbly that I was saving for Rove back in May, will be busted out for her. She is trying to decide on a Master's program in Library Sci, or Env Sci. I tell her all of the time to stay in school and DON'T come into the real working world. :toast:

[wordpix2]

97. at some point you have to work, IF you can get a job

[Roland99]

99. Closing numbers: Back over 11,000

DJIA 11,011.42 +212.19 +1.96%
Nasdaq 2,080.71 +37.49 +1.83%
S&P 500 1,259.81 +22.95 +1.86%
Dow Util 426.28 +6.03 +1.43%
NYSE 8,076.65 +178.29 +2.26%
AMEX 1,911.54 +28.74 +1.53%
Russell 2000 702.34 +20.70 +3.04%
Semcond 414.51 +9.27 +2.29%
Gold future 642.80 +13.30 +2.11%
30-Year Bond 5.10% -0.06 -1.14%
10-Year Bond 5.06% -0.07


Wheeeeee!!!

[UpInArms]

100. day of the dove blather

Stocks surged across the board Wednesday as investors rallied around upbeat remarks from Bernanke that implied policy makers may finally take a breather after two years of interest rate increases. Aside from the Fed Chairman's seemingly dovish commentary that sent short sellers fleeing for cover following weeks of market losses, signs of a potential pause pushed bond yields to session lows and allowed equity investors to look beyond a disappointing CPI report, using solid earnings news and another pullback in oil as additional catalysts to get back into a market that was showing signs of being oversold.

At his semi-annual testimony before the Senate Banking Committee, Bernanke acknowledged that "moderation in economic growth" will lead to a "gradual decline in inflation in coming quarters," welcoming news that overshadowed a fourth straight 0.3% rise in core CPI. That left the year-over-year increase at 2.6%, which is well above the Fed's comfort zone of 1.75-2.00%. Be that as it may, Bernanke's commentary superseded a report that typically has the potential to move stocks and bonds in noticeable fashion.

The optimism about a possible pause was further echoed in fed funds futures, which were implying a roughly 90% chance of a 1/4% rate increase to 5.50% on August 8th following the CPI report, but moved back to pricing in only a 68% chance of another hike and are no longer pricing in any tightening at the three FOMC meetings thereafter.

Of the 10 sectors trading higher, the most influential of them all -- Financials -- paced the way to the upside. The sector surged 2.7% and climbed back into positive territory for the year after J.P. Morgan Chase (JPM 42.06 +1.35) said Q2 net income more than tripled and retail banking earnings at Bank of America (BAC 49.01 +0.57) doubled. A decline in borrowing costs provided additional sector support. The yield on the 10-yr note was as high as 5.17% but closed at 5.05% and more than erased yesterday's 16-tick sell-off that lifted the benchmark 10-yr yield to 5.13%.

Health Care also turned in a gain of more than 2.0%. Managed Healthcare -- one of the worst performing industry groups in Q2 -- garnered extra bargain hunting interest after UnitedHealth (UNH 50.66 +2.26) beat analysts' Q2 forecasts on a 57% rise in revenue and increased its full-year profit outlook. Abbott Labs (ABT 45.80 +1.10) topping estimates and raising guidance also helped Health Care nearly halve its 5.0% year-to-date decline.

Technology, which was under pressure early on after Yahoo (YHOO 25.20 -7.04) merely matched forecasts, as Q2 profits fell 80% on lighter than expected sales and the company delayed the much-anticipated release to its search advertisement system, found renewed buying interest. Despite some uncertainty regarding EPS reports from bellwethers Qualcomm (QCOM 36.73 -0.67) and eBay (EBAY 25.93 -0.66) after the bell, Dow component International Business Machines (IBM 76.15 +1.89) beating Wall Street's expectations by a penny helped restore some optimism about tech's growth prospects.

Even Energy, which was under pressure throughout most of the session in sympathy with falling oil prices, and provided an opportunity for investors to rotate into underperforming areas like Tech and Health Care, closed higher. With Bernanke recently saying that "much of the upward pressure on overall inflation this year has been due to increases in the prices of energy," crude oil futures closing below $73 per barrel, following unexpected builds in weekly gasoline and crude oil inventories, was also seen as welcome news for a market reeling from concerns about rising energy prices. DJ30 +212.19 NASDAQ +37.49 SP500 +22.95 NASDAQ Dec/Adv/Vol 713/2326/1.98 bln NYSE Dec/Adv/Vol 477/2839/1.87 bln

[UpInArms]

101. After the Bell: Intel's profit tumbles 57% amid lower chip sales

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7BE74D51F6%2D7A3C%2D40BD%2DA09C%2DAA0FB532C672%7D&symbol=

SAN FRANCISCO (MarketWatch) - Intel Corp. said late Wednesday second-quarter profit tumbled 57% from a year ago on lower sales as the world's largest chipmaker faced increased competition and cut prices to clear out excess inventory.

Intel, which is betting on a product overhaul and PC price cuts to stave off market losses to smaller rival Advanced Micro Devices Inc., also offered a weaker-than-expected sales forecast for the quarter ending in September.

For the three months ended June 30, the company reported a profit of $885 million, or 15 cents a share, which included 4 cents from expensing stock options. In last year's period, when Intel didn't include option costs in its results, the company earned $2 billion, or 33 cents a share.

Sales fell 13% to $8 billion.

Analysts surveyed by Thomson First estimated Intel (INTC : 18.49, +0.28, +1.5% ) would post sales of $8.3 billion
and earnings of 13 cents a share.

It was the chip giant's lowest sales and profit figures since 2004 and comes amid a company-wide restructuring aimed at refocusing Intel solely on PC and server chips.

...more...

[54anickel]

103. USA for Sale (Part 2)

http://www.whiskeyandgunpowder.com/Archives/20060719.html

snip>

"Roads and bridges built by U.S. taxpayers are starting to be sold off, and so far foreign-owned companies are doing the buying.

"On a single day in June, an Australian-Spanish partnership paid $3.8 billion to lease the Indiana Toll Road. An Australian company bought a 99-year lease on Virginia's Pocahontas Parkway, and Texas officials decided to let a Spanish-American partnership build and run a toll road from Austin to Seguin for 50 years.

"Few people know that the tolls from the U.S. side of the tunnel between Detroit and Windsor, Canada, go to a subsidiary of an Australian company -- which also owns a bridge in Alabama...

"Last year, sold a 99-year lease on the eight-mile Chicago Skyway for $1.83 billion. The buyer was the same consortium that leased the Indiana Toll Road -- Macquarie Infrastructure Group of Sydney, Australia, and Cintra Concesiones de Infraestructuras de Transporte of Madrid, Spain...

"Illinois lawmakers are examining privatizing the Illinois Tollway, New Jersey lawmakers are considering selling 49% of the state's two big toll roads, and a gubernatorial candidate in Ohio wants to sell the turnpike.

"Indiana Gov. Mitch Daniels, who championed his state's toll road deal, now wants investors to build and operate a toll road from Indianapolis to Evansville.

"Patrick Bauer, the Indiana House's Democratic leader, says such deals are taxpayer rip-offs.

snip>

Asset Sell-off Questions

1. Is that a sign of strength?
2. Is that a good thing?

more...

[Roland99]

105. How many American companies own roads in other countries?

Feels like a yard sale to stave off bankruptcy.