STOCK MARKET WATCH, Wednesday 30 August

[ozymandius]

Wednesday August 30, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 875 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2076 DAYS
WHERE'S OSAMA BIN-LADEN? 1776 DAYS
DAYS SINCE ENRON COLLAPSE = 1737
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54


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




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON August 29, 2006

Dow... 11,369.94 +17.93 (+0.16%)
Nasdaq... 2,172.30 +11.60 (+0.54%)
S&P 500... 1,304.28 +2.50 (+0.19%)
Gold future... 619.10 -4.80 (-0.78%)
30-Year Bond 4.93% -0.00 (-0.08%)
10-Yr Bond... 4.78% -0.01 (-0.29%)






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

SUMMARY

Last week we said, "The indices are quite overbought and at near resistance. Consequently, the odds do favor a pullback in the next few trading days. How the indices handle the overbought condition will give us important clues about the current market environment. If we are still in a bull market, the indices will stay above support despite their overbought condition. Any upcoming pullback will be short and shallow, and it will be quickly followed by higher prices. However, if we are in a bear type of environment, most indicators will turn negative within the next 2-3 days and the indices will revisit the first downside targets (see table below) within the next 5-7 trading days. We would be taking profits on 20% of our longs at current levels, we would liquidate 40% on a close below support, and 40% on a close below the first downside targets."

For the week of 8-28-06, most of the indicators we follow have turned down, while the Volatility Indexes are near the bottom of their most recent range. Therefore, the odds favor additional short-term price weakness. However, strangely enough, sentiment (see RYDEX chart below) is near levels that in the past 7 years have marked major bottoms. Consequently, the extreme negative sentiment ought to provide a "floor" for the major indices either at support or at the first downside targets (see table below). If the indices can defy the odds and they close above resistance by Tuesday or Wednesday, then the picture will turn rather bullish, and we ought to expect a further advance up towards the first upside targets.

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

[ozymandius]

2. Today's Reports

8:30 AM Chain Deflator-Prel. Q2
Briefing Forecast 3.3%
Market Expects 3.3%
Prior 3.3%

8:30 AM GDP-Prel. Q2
Briefing Forecast 3.0%
Market Expects 3.0%
Prior 2.5%

10:30 AM Crude Inventories 08/25
Briefing Forecast NA
Market Expects NA
Prior -643K

[UpInArms]

18. 8:30 Reports:

8:32 AM ET 8/30/06 U.S. Q2 GDP REVISIONS REFLECT STRUCTURES, INVENTORIES, EXPOR

8:32 AM ET 8/30/06 U.S. Q2 CONSUMER SPENDING UP 2.6% VS. 2.5%

8:32 AM ET 8/30/06 U.S. Q2 BEFORE-TAX CORPORATE PROFITS UP 3.2%, 20.5% Y-O-Y

8:32 AM ET 8/30/06 U.S. Q1, Q2 COMPENSATION REVISED HIGHER

8:32 AM ET 8/30/06 U.S. CORE INFLATION UNREVISED AT 2.3% YEAR-OVER-YEAR

8:32 AM ET 8/30/06 U.S. Q2 CORE PCE PRICE INDEX REVISED TO 2.8% FROM 2.9%

8:32 AM ET 8/30/06 U.S. Q2 GDP FALLS SHORT OF 3.0% EXPECTATIONS

8:30 AM ET 8/30/06 U.S. Q2 GDP REVISED TO 2.9% VS. 2.5%

[UpInArms]

19. U.S. Q2 GDP revised to 2.9% vs. 2.5%

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B7A7B413F%2D3D58%2D44C0%2D9F0C%2DAC52965CF0A1%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) - U.S. real gross domestic product for the second quarter was revised to 2.9% annualized from the earlier estimate of 2.5%, the Commerce Department said Wednesday. Final sales were revised to 2.3% growth from 2.1%. The revisions to the second-quarter GDP were largely due to higher investments in nonresidential structures, more inventory building and higher exports, offset by lower investments in housing. Growth in wages and salaries was revised nearly a third higher than the previous estimates. Key inflation data were revised marginally lower. Core prices increased 2.8%, down from 2.9% reported earlier. Corporate profits increased 3.2% quarter-to-quarter, down from the 12.6% increase in the first quarter. In the past year, before-tax profits are up 20.5%.

[54anickel]

22. U.S. Economic Growth Slowed to 2.9% Rate in the Second Quarter

http://www.bloomberg.com/apps/news?pid=20601087&sid=a50_AolzhdAI&refer=home

Aug. 30 (Bloomberg) -- The U.S. economy grew at an annual rate of 2.9 percent in the second quarter, fueled by a buildup in inventories that may point to slower growth in coming months, a government report showed.

The increase in gross domestic product, the sum of all goods and services produced in the U.S., compares with the 2.5 percent gain initially reported on July 28 and a 5.6 percent rate for the first quarter, the Commerce Department said today in Washington.

While second-quarter growth was stronger than initially reported, the economy probably will continue to slow this year as consumer spending and home building weaken and factories scale back production to work off inventories, economists said. Waning demand and the end of the housing boom may persuade Federal Reserve policy makers to keep interest rates unchanged.

``We're starting to see a slowdown here in a more meaningful way in the third quarter,'' Richard DeKaser, chief economist at National City Corp. in Cleveland, said before the report. ``We're seeing an accelerated pace of decline in the housing sector. Growth in inventories is providing less momentum for factories than we had thought.''

snip>

Today's GDP estimates are the second for the quarter and will be revised again next month. Growth in the first quarter was the fastest in more than two years.

``We've had an awfully good run in the economy with some pretty significant shocks, I think, and it wouldn't be surprising to see some slowing speed in the economy,'' General Mills Inc. Chief Executive Officer Stephen Sanger said in an interview on Aug. 23.

While spending growth is slowing, prices paid by consumers are not, today's report showed....

more...

[UpInArms]

45. DOE Petroleum Inventories Report:

10:31 AM ET 8/30/06 U.S. CRUDE SUPPLY UP 2.4 MLN BRLS LAST WEEK: ENERGY DEPT.

10:31 AM ET 8/30/06 U.S. DISTILLATE SUPPLY UP 1.3 MLN BRLS: ENERGY DEPT.

10:31 AM ET 8/30/06 U.S. GASOLINE SUPPLY UP 400,000 BRLS: ENERGY DEPT.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BEBD0134B%2D0F99%2D4910%2DBE6B%2DAFA0E65275D2%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- The Energy Department said crude supplies rose 2.4 million barrels to 332.8 million for the week ended Aug. 25, contrary to expectations for a decline. Motor gasoline inventories stocks rose for a second week in a row, up 400,000 barrels to total 206.2 million barrels. Distillate supplies climbed 1.3 million barrels to 136.8 million. Following the news, October crude fell 61 cents to $69.10 a barrel. September unleaded gas shed 2.92 cents to $1.76 a gallon and September heating oil was at $1.93 a gallon, down 1.32 cents.

[UpInArms]

46. API Petroleum Inventories Report:

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B47E8971D%2DF65B%2D42DC%2D8675%2DA6E7823C2A36%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- The American Petroleum Institute said motor gasoline supplies rose 783,000 barrels for the week ended Aug. 25. The Energy Department had reported a climb of 400,000 barrels. Crude inventories were up 3.5 million barrels, the API said, compared with the 2.4 million-barrel rise reported by the government. Distillate stocks rose 1.7 million barrels, the API said, nearly matching the Energy Department's reported 1.3 million-barrel increase.

[ozymandius]

3. Oil prices up slightly

SINGAPORE - Oil prices rose slightly Wednesday as traders awaited the weekly U.S. inventories report as well as the upcoming U.N. deadline for Iran to halt uranium enrichment or face possible sanctions.

Light sweet crude for October delivery rose 14 cents to $69.85 a barrel in midafternoon Asian electronic trading on the New York Mercantile Exchange. The increase followed two days of sharp drops that brought oil futures to $69.71 a barrel, roughly 10 percent below their level of just three weeks ago.

October Brent crude at London's ICE Futures exchange gained 14 cents to trade at $70 a barrel.

Prices had fallen this week amid relief that a weaker tropical storm Ernesto, which landed in Florida late Tuesday, appeared to be of little threat to Gulf of Mexico oil facilities.

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

[ozymandius]

5. BP Confirms U.S. Inquiry Into Its Energy Trading

BP, the giant London-based oil company, suffered another blow to its reputation today after it acknowledged that federal investigators in the United States were looking into suspected trading irregularities in oil and gasoline markets.

BP said it was “aware of investigations” by federal authorities and was cooperating with them. The Wall Street Journal reported today that the Commodity Futures Trading Commission and the Justice Department were examining possible manipulation in the over-the-counter crude oil market in 2003 and 2004 and the gasoline trading in 2002. The Journal said other companies might also be investigated. No charges have been brought against BP, the newspaper said.

The investigations come as BP is already facing a wide set of inquiries in the United States that included allegations that it neglected to properly maintain pipelines in Alaska, leading to an oil spill earlier this year; that its safety failures led to a deadly explosion at a refinery in Texas City last year, killing 15 people; and that its traders manipulated the propane market.

A BP spokesman, Ronnie Chappell, said in a statement: “We routinely assist regulators and other authorities in their request to understand the facts related to our businesses. Having said that, we do not comment on the specifics of these requests or the agencies that make the requests.”

http://www.nytimes.com/2006/08/29/business/29cnd-oil.html?_r=1&oref=slogin

[ozymandius]

7. Detroit Sees Cheap Gas as History

TOLEDO, Ohio, Aug. 28 — The Chrysler Group, which depends more heavily on sales of pickup trucks and sport utility vehicles than any other Detroit automaker, said Monday that it expected gasoline prices to remain at $3 to $4 a gallon for the rest of this decade.

The comments by Thomas W. LaSorda, Chrysler’s chief executive, are the first time a Detroit automaker has issued a specific forecast on gas prices since they began climbing to $3 a gallon and higher.

Ford’s chief sales analyst agreed Monday that high gas prices were not a temporary phenomenon, although he did not cite a price range. The analyst, George Pipas, said the auto company expected gas prices to remain high, volatile and unpredictable.

-cut-

Mr. LaSorda said Chrysler had prepared a business model based on the assumption that gas prices would remain in that range for the next three to four years. That is about the period of time it takes for an automaker to develop a new vehicle.

http://www.nytimes.com/2006/08/29/business/29auto.html

[ozymandius]

8. Californians weigh a new tax on oil companies

STUDIO CITY, CALIF. – As Los Angeles motorist Jill Cantrell removes the pump nozzle from her Honda Civic gas tank, she spouts out two figures: "$56 for a gas tank for me and $78 billion in profits last year for the oil companies," she says. "I'm livid."

How many other Californians are angry about gasoline prices - and ready for their state to take action - will be clear this November, when voters decide whether to levy a new tax on oil companies that drill in California and use the money for in-state development of alternative fuels.

The fight over Proposition 87 is no small matter. Not only will the vote give Congress and other states a first reading of public disgruntlement over gasoline prices, but it might even affect the domestic oil market. California crude, after all, accounts for 12 percent of US production - supplying 37 percent of the state's oil demand, according to the Legislative Analyst's Office.

Prop. 87 aims to raise and spend $4 billion on alternative-fuel programs over time, with the goal of cutting Californians' use of gasoline and diesel 25 percent by 2017. It also would prohibit oil companies from simply raising prices at the pump to cover their costs of the new tax.

http://www.csmonitor.com/2006/0829/p01s03-uspo.html

[UpInArms]

56. Oct Crude closes @ $70.03 bbl

2:53 PM ET 8/30/06 OCT. CRUDE RECOVERS FROM AN EARLIER DECLINE TO A 5-MONTH LOW

2:53 PM ET 8/30/06 OCT. CRUDE CLOSES AT $70.03/BRL, UP 32 CENTS

[fasttense]

4. More poor, more uninsured, more corporate welfare.

Downward Mobility

Published: August 30, 2006
If you’re still harboring the notion that the economy is “good,” prepare to be disabused.

Even the best number from yesterday’s Census Bureau report for 2005 is bad news for most Americans. It shows that median income rose 1.1 percent last year, to $46,326, the first increase since it peaked in 1999. But the entire increase is attributable to the 23 million households headed by someone over age 65. So the gain is likely from investment income and Social Security, not wages and salaries.

For the other 91 million households, the median dropped, by half a percent, or $275. Incomes for the under-65 crowd were hurt by a decline in wages and salaries among full-time working men for the second year in a row, and among full-time working women for the third straight year. In all, median income for the under-65 group was $2,000 lower in 2005 than in 2001, when the last recession bottomed out.

Despite the Bush-era expansion, the number of Americans living in poverty in 2005 — 37 million — was the same as in 2004. This is the first time the number has not risen since 2000. But the share of the population now in poverty — 12.6 percent — is still higher than at the trough of the last recession, when it was 11.7 percent. And among the poor, 43 percent were living below half the poverty line in 2005 — $7,800 for a family of three. That’s the highest percentage of people in “deep poverty” since the government started keeping track of those numbers in 1975.

As for the uninsured, their ranks grew in 2005 by 1.3 million people, to a record 46.6 million, or 15.9 percent. That’s also worse than the recession year 2001, reflecting the rising costs of health coverage and a dearth of initiatives to help families and companies cope with the burden. For the first time since 1998, the percentage of uninsured children increased in 2005.

The Census findings are yet another indication that growth alone is not the answer to the economic and social ills of poverty, income inequality and lack of insurance. Economic growth was strong in 2005, and productivity growth was impressive. What have been missing are government policies that help to ensure that the benefits of growth are broadly shared — like strong support for public education, a progressive income tax, affordable health care, a higher minimum wage and other labor protections.

President Bush is unlikely to push for those changes, wed as he is to tax cuts that mainly benefit the wealthy. But the economic agenda for the next president couldn’t be clearer.

http://www.nytimes.com/2006/08/30/opinion/30wed1.html?_...

[Ghost Dog]

35. Report: U.S. poverty getting worse

http://news.monstersandcritics.com/business/article_1195920.php/Report_U.S._poverty_getting_worse

WASHINGTON, DC, United States (UPI) -- Median U.S. household income rose modestly in 2005, while the poverty rate remained unchanged, the Center on Budget and Policy Priorities said Tuesday.

For the first time, median income was lower in the fourth year of an economic recovery -- and poverty was higher -- than when the last recession hit bottom and the recovery began, the center said.

Median income remained $243 below its level in the recession year of 2001, while the poverty rate at 12.6 percent, remained well above its 11.7 percent rate in 2001.

In addition, both the number and the percentage of U.S. residents who lack health insurance climbed again and remained much higher than in 2001.

/...

[Ghost Dog]

36. Census: U.S. Poverty Level Steady

http://www.postchronicle.com/news/breakingnews/article_21236741.shtml

WASHINGTON, Aug. 30, 2006 (UPI) -- Real median household income in the United States rose by 1.1 percent but the poverty rate was unchanged at 12.6 percent, the U.S. Census Bureau said.

The bureau, in a release Tuesday, said median income rose to $46,326 between 2004 and 2005 and while the news on the poverty rate was relatively good -- it was the first time in four years it had not gone up -- the number of people in the United States without health insurance increased to 46.6 million.
Continue reading this article below

The release said 2005 was the first year since 1999 that real median household income showed an annual increase.

There were 37 million people in poverty in 2005. Both the number and percentage rate were statistically unchanged from 2004, marking the end of four consecutive years of increases in the poverty rate, the Census Bureau said.

Data show the number of people in the United States with health insurance increased some 1.4 million but the number without rose by 1.3 million, meaning 15.9 percent of the population doesn't have healthcare coverage.

/...

Same source as above, different spin. I suppose that's what's called 'covering all the bases'.

[Ghost Dog]

37. 600 million in Asia live on less than $1 a day

http://business.guardian.co.uk/story/0,,1860728,00.html
Associated Press
Wednesday August 30, 2006
The Guardian

More than 600 million people in Asia live on less than $1 a day despite rapid economic growth, it was claimed yesterday. A report by the International Labour Organisation (ILO) said that growth had lifted 250 million people in China and India over the subsistence level of $1 a day, but much more needed to be done.

If the poverty line was $2 a day, the report said, Asia would have about 1.9 billion poor people - more than three-quarters of the world total. The ILO, meeting in Busan, South Korea, said job creation in Asia had not kept up with economic growth and productivity.

/...

[Ghost Dog]

38. Asia and Pacific region faces massive jobs gap

ILO Regional Meeting to discuss new strategies for creating productive employment, decent work and reducing poverty

International Labour Organisation Press Release
Monday 28 August 2006 (ILO/06/39)

BUSAN, Republic of Korea (ILO News) - Robust growth in trade, investment and output have failed to keep pace with the growth of the labour force and tackle rising unemployment in Asia and the Pacific, where an estimated 250 million more workers are expected to be looking for jobs over the next decade, according to a new report from the International Labour Organization (ILO).

The report (.pdf), "Realizing Decent Work in Asia" (Note 1), prepared for the ILO's 14th Regional Meeting to be held here from 29 August to 1 September, says the region has made remarkable headway economically and now occupies a "premier position in the global economy."

However, while many countries in the region have made huge strides in reducing poverty, over 1 billion "working poor" are living under the US$2 per person, per day poverty line, including more than 330 million living in extreme poverty of less than US$1 a day. What's more, unemployment rates have increased over those prevailing five to seven years ago in much of the region.

"The gap between growth and job creation is producing a deficit in decent work and putting the brakes on efforts to reduce poverty," says Juan Somavia, Director-General of the ILO. "The jobs challenge is enormous. At approximately 1.9 billion working women and men, Asia's labour force is huge and growing - by at least 14 per cent, or 250 million, over the next ten years."

Government, employer and worker delegates from 40 ILO member States in the region will discuss diverse challenges, including competitiveness, productivity and decent jobs in a globalizing context; decent jobs for young people; managing labour migration; labour market governance for realizing decent work in Asia; and extending social protection to the informal economy. The discussions will take up standards and fundamental principles and rights at work, gender equality and social dialogue as cross-cutting themes.

Perhaps the most worrying aspect of the jobs deficit is its impact on young people. In 2005, Asia had over 48 per cent, or 41.6 million, of the world's young people without work. The risk of being unemployed for young people is at least three times higher than that of adults.

/continues...

[Ghost Dog]

40. cf. Disaster capitalism: how to make money out of misery

http://www.guardian.co.uk/commentisfree/story/0,,1860821,00.html?gusrc=rss&feed=1
(& DU: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x2010968 )

<snip>

We saw the results in New Orleans one year ago: Washington was frighteningly weak and inept, in part because its emergency management experts had fled to the private sector and its technology and infrastructure had become positively retro. At least by comparison, the private sector looked modern and competent.

But the honeymoon doesn't last long. "Where has all the money gone?" ask desperate people from Baghdad to New Orleans, from Kabul to tsunami-struck Sri Lanka. One place a great deal of it has gone is into major capital expenditure for these private contractors. Largely under the public radar, billions of taxpayer dollars have been spent on the construction of a privatised disaster-response infrastructure: the Shaw Group's new state-of-the-art Baton Rouge headquarters, Bechtel's battalions of earthmoving equipment, Blackwater USA's 6,000-acre campus in North Carolina (complete with paramilitary training camp and 6,000-foot runway).

I call it the Disaster Capitalism Complex. Whatever you might need in a serious crunch, these contractors can provide it: generators, watertanks, cots, port-a-potties, mobile homes, communications systems, helicopters, medicine, men with guns.

This state-within-a-state has been built almost exclusively with money from public contracts, including the training of its staff (overwhelmingly former civil servants, politicians and soldiers). Yet it is all privately owned; taxpayers have absolutely no control over it or claim to it. So far, that reality hasn't sunk in because while these companies are getting their bills paid by government contracts, the Disaster Capitalism Complex provides its services to the public free of charge.

<snip>

Here's a snapshot of what could be in store in the not-too-distant future: helicopter rides off rooftops in flooded cities at $5,000 a pop ($7,000 for families, pets included), bottled water and "meals ready to eat" at $50 a head (steep, but that's supply and demand), and a cot in a shelter with a portable shower (show us your biometric ID, developed on a lucrative homeland security contract, and we'll track you down later with the bill).

The model, of course, is the US healthcare system, in which the wealthy can access best-in-class treatment in spa-like environments while 46 million Americans lack health insurance. As emergency-response, the model is already at work in the global Aids pandemic: private-sector prowess helped produce life-saving drugs (with heavy public subsidies), then set prices so high that the vast majority of the world's infected cannot afford treatment.

/...

[Demeter]

6. They've Decided to Stop Strangling The Goose That Lays Golden Eggs

Local gas price: $2.60/gal for reg. down from $3.19 of 2 weeks ago. Predictions that price shall remain low until Labor Day have now been extended as far as Xmas....

The Fed stops raising rates and contemplates the need to lower them, while Walmarts profits fall, the back=to=school sales fail to materialize, and the truth about wages and profits actually hits the papers.

I think the powers-that-be are getting a bit nervous.


Good.

[54anickel]

20. They'll explain it as seasonal. The peak summer driving season

is over. I always had a hard time with that concept to begin with. Summer vacation means school buses are parked, vacationers aren't commuting to and from work or school. Sure some pack up the car and head out somewhere - many don't. Some make it as far as the long-term parking ramp at the airport.

It's not like back in the early days of "America's love affair with the automobile". But it's a great excuse to bump up the prices. Remember how they'd tend to creep up just before a holiday? It's been going on for so long now we all just accept and expect it.

[bahrbearian]

34. I remember all through the 60's that in the summer everyone

rode their bicycles,, Mom wasn't there to take you to the mall,,we wanted to go to the lake,,stream or beach,,the family car couldn't get to some of those places,, but they "Paved Paridise and put in a Parking Lot"

[54anickel]

42. Yep, the "good old days". Took my bike or horse everywhere! Now

I go thru where all the trails were and there are subdivisions everywhere. Oh well, that's what they call progress.

Of course, when I was a kid there were very few moms that even drove. Most families only had 1 car and Dad had that at work. My neighbor's mom drove, and on the days she wanted the car she'd take her husband to work. She made damn sure she was back home in time to pick him up! They finally got a second car when she decided to get a job.

[Gregorian]

59. I find it refreshing to see others with my values.

I restrain myself from habitual automobile use, unlike the majority of those who have set their lives up around the damn thing. And I absolutely love the bicycle. I can sympathize with your woes about subdivisions.

I only wish people knew the truth. I'll stop here. This is a multiple faceted subject that can go in many directions. I believe in being careful and responsible. Sometimes I feel like the only one.

[DemReadingDU]

62. those good old days!

We grew up in a small town in Indiana, in the 50's & 60's. We walked or biked everywhere too. We kids played with the kids in the neighborhood, or rode our bikes to the local playground...we weren't toted to those 'play-dates' that so many moms do nowadays. Even when I was 1st married and had my own babies in the mid-70's, we only had 1 car. If I needed the car, I had to take husband to work that day. It wasn't until my kids were in grade school that I went to work in the 80's that I had to buy my first car!

P.S. I love this Stock Market thread, I don't often post, but there is lots of valuable investment info here. thanks!

[ozymandius]

9. U.S. Fed policy-makers worried about inflation

U.S. Federal Reserve (Fed) policy-makers were worried about inflation risks at their Aug. 8 meeting although they decided to halt the central bank's credit- tightening campaign for the first time in two years, according to the minutes of the meeting.

The policy-makers agreed that "inflation risks remained dominant and that consequently keeping policy unchanged at this meeting did not necessarily mark the end of the tightening cycle," said the minutes, released on Tuesday.

At the meeting, the policy-makers kept the federal funds rate unchanged at 5.25 percent, taking a breather after they raised the Fed's benchmark short-term rate for 17 consecutive times in a one- quarter percentage pace since June 2004, when the rate stood at one percent.

The suspension allowed the Fed to assess the toll on economic activity and inflation of the 17 rate hikes, said the minutes. It can take time for rate increases to work their way through the economy.

http://english.people.com.cn/200608/30/eng20060830_298062.html

[ozymandius]

10. See you when it's over.

:donut: :donut:

Have a great day folks!

Ozy :hi:

[NC_Nurse]

11. You too!

Off to the hospital! I'll read the thread later!
:hi:

[cboy4]

12. I notice you go to the trouble of posting all of this information on

a daily basis (At least it's here on the days I look)

I'm not sure how many people thank you for doing it, so I thought I'd say THANKS!! :hi:

[AnneD]

52. Morning Marketeers,

:donut: and lurkers. Cboy, we thank Ozy et al on at least a weekly basis....but it never hurt to show appreciation again. The thread has become a solid source of real info for many of us economy wonks. It never ceases to amaze me at the depth and breadth of knowledge we have here. The fact that everyone is so friendly here is a plus.
Sine the number of poor and uninsured is making the news (this is NOT news to anyone in health care), I'll share this gem that caught my eye recently.

U.S. Employers Look Offshore for Health care
As costs rise, workers are being sent abroad to get operations that cost tens of thousands more in the U.S.
By Daniel Yi, Times Staff Writer
July 30, 2006

<snip>
A growing number of employers that fund their own health insurance plans are looking into sending ailing employees abroad for surgeries that in the U.S. cost tens of thousands of dollars more.

No major insurer offers such travel, but several employers that fund their own benefit programs have expressed interest, according to consultants and medical tourism agencies. No statistics are readily available on how many companies or patients have undertaken such travel.
<snip>

Arnold Milstein, chief physician at human resources consulting giant Mercer Health & Benefits, said he had been hired by three Fortune 500 companies interested in contracting with offshore hospitals. Milstein said the employers requested anonymity because they were not ready to unveil plans to their workers.

<snip>
U.S. hospital operators say that doesn't bode well for them.

"This is not the solution," said California Hospital Assn. spokeswoman Jan Emerson. "In fact, this could make problems worse."
<snip>
But there are risks. Patients have little or no legal recourse in medical malpractice cases because of relatively weak patient-protection laws in such countries as India and Thailand, popular surgery destinations among Americans. And U.S. medical organizations and government agencies do not oversee foreign facilities.


http://www.latimes.com/business/la-fi-outsource30jul30,0,2330630.story?coll=la-home-headlines

The really sad part in all of this it that America has the best health care but the most difficulty accessing it. Insurance companies and the HMO gutted our hospital system and ruined rural health care. I told Nurses on many a board that this would be the next thing. Of course I was laughed off the boards but here we are.:eyes: I am so opposed to this. I lost one of my best friends to a botched stomach reduction surgery overseas. This action would totally gut our hospital system.

Happy hunting and watch out for the bears.

[cboy4]

53. Excellent that he's well acknowledged. I generally catch his original

post, but not too much "traffic" after that.

I can see the thread really grows. It's quite good! :)

[UpInArms]

13. daily dollar watch

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

Last trade 85.02 Change +0.07 (+0.08%)

Fed Concern About Housing and Drop in Confidence Sends US Dollar Lower

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Fed_Concern_About_Housing_and_1156887102813.html

US Dollar

The US dollar erased earlier gains after the release of the FOMC minutes from the last monetary policy meeting. Unfortunately for dollar bulls, the report did not contain enough hawkishness to warrant dollar positive positions at the bottom of the EUR/USD’s recently tight trading range. Even though the Fed phrased the pause as a delay rather than an end to future rate hikes and reiterated that additional firming may be needed, their later words suggest that this is more obligatory statement than anything else. Looking ahead, they felt that inflation pressures could ease gradually and that growth could slow more than expected. In fact, the Fed believed that past interest rate hikes could keep growth “below potential” for up to six quarters or 1.5 years. Their biggest problem is housing, which is also the market’s biggest worry. Given the recent slide in new and existing home sales and today’s drop in oil prices below $70 a barrel, both the outlook for inflation and growth are tilted to the downside. Today’s sharp drop in consumer confidence only escalates the concern about growth. In the month of August, US consumer confidence fell to the lowest level in 10 months. The drop was the biggest since September 2005 right after Hurricane Katrina hit and suggests that US consumers may finally be feeling the pain of the housing market and the wild fluctuations in oil prices. If this trickles into spending, we will have a big problem at hand. With retail sales not due for a few weeks, the more immediate signal from the confidence report can be found in the employment component. There was a sharp drop in the number of people who felt that jobs were plentiful which suggests that non-farm payrolls may not meet up to par later this week. Overall, the message to gather from today’s reports is that the Fed is not likely to hike rates again any time soon and if economic data continues to deteriorate, any possibility of them doing so could shrink to nil.

...more...

[54anickel]

21. Hey UIA, have you noticed for the past 3 - 6 months how the movement

in the buck seems to be a reverse mirror of the movement in the S&P and DOW? As the buck trends up, the market trends down and vice-vera. It's not on the day to day basis but in the charts. Inflation seems to be making it's way into stocks again a little at a time as the buck looses its purchasing power. :shrug:

[UpInArms]

27. it seems there is now that correlation - but what happened

to the hidden inflation from Jan 2001 - when the dollar was at 120 on the index to now - at 85 on the index?

That is one hell of a drop in purchasing power.

:shrug:

[RawMaterials]

41. my guess is that its in

Iraq & Afghanistan & home prices,
also as the housing market cools the money is going to flow into stocks, until b*sh leaves office then, were do for hyper inflation and a terrible economy, that the repubs will blame on democratic leadership. :(

[54anickel]

47. Heh-heh, wouldn't that be the "wealth creation" Greenspin used to fondly

speak of?

A GROTESQUE MISNOMER
http://www.gold-eagle.com/gold_digest_04/richebacher052804.html

Economic growth now depends crucially on the strength of wealth and profit creation. Mr. Greenspan and the bullish consensus economists claim that America is enjoying its highest rate of wealth creation in history - through rising asset prices.

Fed members are claiming that this is a perfectly normal transmission mechanism of monetary policy. This is an outright lie. Never before have inflating asset prices been a key driver of real economic activity.

snip>

The striking key feature of so-called wealth creation through asset bubbles in favor of the consumer is, first of all, the associated record production of debt, set against the total absence of income creation. To maintain demand creation through this kind of wealth creation, ever more debt creation is needed - first, to keep the asset prices inflating; and second, to fund the spending on consumption.

Thinking it over, one realizes that "wealth creation" is really a grotesque misnomer for asset prices that are rising out of proportion to current income. The economic reality is not wealth creation, but impoverishment.... I owe my soul to the company store.

[54anickel]

49. No Cuts, No Butts, No Coconuts

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

snip>

It is a problem money or social security lock boxes, strangely enough, probably can’t solve and that having more babies and stepped up legal or illegal immigration can. But the babies take 20+ years to grow into worker bees and we’ve long passed that point of no return. Immigration, as we all know, is a political hot topic and not likely to lead to rational conclusions or solutions anytime soon. So the boomers will be left it appears with a generational conundrum of gigantic proportions: who will take care of them?; who will still feed them – when they’re 64? Fauna Kane, a Southern California boomer quoted by John Tierney in a recent article in The New York Times, says that people she knows aren’t “thinking ahead, but nobody does…you think the good Lord’s going to care of you.” Perhaps Mrs. Kane, but absent a miracle, it will be up to younger generations to do the Lord’s work and there aren’t enough of them to provide health care, a comfortable retirement, and to compete head-on with the Asian invasion at the same time. Something has to give way. In financial terms alone, Laurence Kotlikoff, a Boston University economist has estimated the unfunded liabilities of Americans associated with healthcare and retirement amount to $80 trillion, over seven times our annual GDP!

It is fairytale fiction of course to think that in the face of a “worker” shortage which appears unsolvable, that any amount of government promises to pay will provide the answer. That is why social security “fixes” that involve accounting changes, or deposits of government “bonds” which in turn pay for future “bonds” are near laughable. A lack of workers can be solved only by producing more of them and that will almost assuredly be done only by extending American’s retirement age into their late 60s and a scaling back of their benefits. More workers to help the boomers? The Lord, Mrs. Kane, helps those that help themselves, and there will be a lot more of that in the next decade. Either by deferring social security benefits or simply “incentivizing” sixty-somethings to stay on the job because their retirement nest eggs have come up short of expectations – we will begin to solve this new conundrum the old-fashioned way – we will have to work for it. Based on the following chart of potential new medical students, it appears that the Boomer’s surgeons in the next few decades will have grayer hair and maybe less steady fingers in the operating room. Staying healthy is perhaps the only recourse.



Those that fictionalize a domestic “financial” solution to this demographic conundrum have loads of imagination, but little common sense. To think that all the boomers have to do is sell their homes to pay for retirement and healthcare begs the legitimate question of “to whom and at what price?” If there are fewer X’ers and Y’ers to unload even their second homes to, rudimentary supply/demand curve analysis suggests prices must adjust downward to facilitate the transfer, incorporating the ability of immigrants and future first time buyers to afford what now seem to be unaffordable starter homes. Similar logic applies to holdings of domestic stocks, bonds, or any other “asset” which boomers count on individually to fund their retirement needs, but which collectively must be unloaded to a smaller demographic of tentative buyers. It will be next to impossible to borrow or sell our way out of this one.

snip>

Far better, like squirrels sniffing out an approaching winter, to have gathered and stored a harvest of nuts and seeds to carry us through the approaching December nights. While a “domestic” financial solution is a mirage, there’s no doubt that had we saved and invested those savings outside our borders, that one day we would have been able to ring the “accounts receivable” doorbell and extend our standard of living. Instead, a President fixated on emulating a former Republican icon of a far different demographic era, chose to emphasize tax cuts for the rich and excessive consumption. With no more sense than our story’s Mrs. Kane, he chose not to think ahead, but to look to the past; to emulate Reagan tax policies which were more than appropriate in the 80s, but which were increasingly less appropriate as the twenty-first century unfolded with its aging boomers serving as the proverbial pothole in the road ahead; to mnemonically recite like a schoolboy at a blackboard, “no new taxes” – the phrase that had condemned his father to a one-term presidency; and to have surrounded himself with advisers who had no less vision or courage than himself. The W presidency will go down in the ashes of history for more than just Iraq.

Too late to have babies, too politically sensitive to import more workers, too daft to recognize that the boomer winter is rapidly approaching and that our assets will not fund our liabilities. Too, too. Too, too. Too, too. What does a government do that is too absorbed in the moment and fails to alert its citizens to the perils ahead? Cut in line, I suppose. It devalues its currency, it reflates/inflates its economy, and because that doesn’t create real wealth, it recites the mythology of a bygone era, of a “shining city on a hill,” so that its citizens believe they’ve never had it so good. Well, as I acknowledged at the start of this Outlook, some of us never have had it so good, but the demographic season is changing and a rebalancing, more equitable distribution of our rather meager stockpile of nuts lies ahead. Corporate profits, nearing a record percentage of GDP will ultimately be taxed at higher levels in order to assuage a populist ballot-box revolt. And U.S. stocks, the present value of which represents the future value of private sector wealth creation, will stutter, perhaps stagger, as investors understand that much future wealth has been spoken for, if not already digested, by a boomer generation acting as consumers of first and last resort.

more...

[54anickel]

50. Delaying retirement may avert decline in growth

http://www.ft.com/cms/s/80d257f2-376c-11db-bc01-0000779e2340.html

Longer working hours and delayed retirement may prove the only ways to avert a sharp decline in long-term economic growth caused by an ageing population in the 12-country eurozone, according to research published by the European Central Bank.

It is also sceptical about the extent to which migration can ease Europe’s ageing crisis. “A number of recent studies conclude that the stabilisation of old age dependency ratios through migration alone is unlikely, due to the huge number of migrants that would be required,” it notes.

Eurozone growth could plunge to only about 1 per cent a year from 2020 – less than half the average during the past 25 years – on a worst-case scenario, according to calculations presented in the paper. Even if optimistic assumptions are made about labour productivity and utilisation, “demographic factors would still exert a significant negative impact,” the study concludes.

The research paper, which does not necessarily reflect the views of the ECB, builds on earlier studies by the European Commission to highlight the impact of Europe’s ageing population on the region’s long-term growth prospects.

more...

[UpInArms]

14. US home loan demand falls 1st time in four weeks

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-08-30T110318Z_01_N30172736_RTRIDST_0_ECONOMY-MORTGAGES-UPDATE-1.XML

NEW YORK, Aug 30 (Reuters) - U.S. mortgage applications fell for the first time in four weeks as demand for home purchase loans dropped to the lowest level in nearly three years, an industry trade group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and purchasing loans, for the week ended Aug. 25 decreased 0.9 percent to 556.5 from the previous week's 561.5.

Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.39 percent, up 0.01 percentage point from the previous week when they sank to their lowest since March. Interest rates were above year-ago levels of 5.73 percent but below a four-year high of 6.86 percent touched in June.

The MBA's seasonally adjusted purchase mortgage index fell 1.6 percent to 375.9, its lowest since November 2003. The purchase index, which is considered a timely gauge of U.S. home sales, was substantially below its year-ago level of 470.6.

The group's seasonally adjusted index of refinancing applications increased slightly to 1,609.2 from 1,608.5. A year earlier the index stood at 2,187.8.

...more...

[UpInArms]

15. Treasuries flat before GDP revision, 5-year supply

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-08-30T120852Z_01_N30289928_RTRIDST_0_MARKETS-BONDS.XML

NEW YORK, Aug 30 (Reuters) - U.S. Treasury debt prices were little changed on Wednesday ahead of revisions to second quarter GDP data and an auction of $14 billion in new five-year notes.

Benchmark 10-year Treasury yields <US10YT=RR> held steady at five-month lows, as players moved to the sideline in case data showed that the U.S. economy grew faster in the second quarter than initially estimated.

The median forecast on the first revision of annualized second-quarter GDP growth was 3.0 percent, up from the preliminary estimate of 2.5 percent, according to analysts polled by Reuters.

The core PCE price index, the Fed's preferred measure of inflation, was expected to stay unchanged at 2.9 percent -- still well above the Fed's perceived comfort range of inflation of 1 percent to 2 percent.

Treasury prices rose late Tuesday after the minutes from the Federal Reserve's Aug. 8th meeting showed that policymakers with the exception of Richmond Fed President Jeffrey Lacker agreed that economic growth would slow in the second half of 2007 and keep a lid on inflation.

...more...

[UpInArms]

30. Printing Press Hums: Fed adds bank reserves via seven-day system repos

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-08-30T133304Z_01_N30342999_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, Aug 30 (Reuters) - The Federal Reserve said on Wednesday it added temporary reserves to the U.S. banking system through seven-day system repurchase agreements.

Fed funds last traded at 5.25 percent, the Fed's target for the benchmark overnight lending rate.

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

[UpInArms]

58. Fed's Lacker spews

2:46 PM ET 8/30/06 LACKER: NO SPILLOVER TO ECONOMY YET FROM HOUSING WEAKNESS

2:44 PM ET 8/30/06 LACKER SAYS HAS NOT CHANGED MIND, RATE HIKE STILL NEEDED

2:43 PM ET 8/30/06 LACKER: JULY INFLATION DATA A LITTLE BETTER VS PREV MONTHS

2:42 PM ET 8/30/06 LACKER: 'WE ARE NOT OUT OF THE WOODS YET' ON INFLATION

2:38 PM ET 8/30/06 LACKER: FED 'HOPE' IS THAT CHEAPER ENERGY WILL CUT INFLATION

2:34 PM ET 8/30/06 LACKER VOTED AGAINST AUG. PAUSE, WANTED INFLATION DOWN FAST

2:34 PM ET 8/30/06 LACKER SAYS EXPECTED U.S. SLOWDOWN WON'T REDUCE INFLATION

2:32 PM ET 8/30/06 FED'S LACKER: AUG. RATE HIKE WOULDN'T HAVE HURT U.S. GROWTH

[UpInArms]

16. ADP sees 107,000 jobs created in Aug/Sign of continued sluggish job growth

8:15 AM ET 8/30/06 ADP SURVEY SHOWS SLUGGISH RISE IN AUG. EMPLOYMENT

8:15 AM ET 8/30/06 AUG. ADP PAYOLL SURVEY NET GAIN OF 107,000 PVT-SECTOR JOBS

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B9C08F565%2D731E%2D4BE5%2DAFD9%2DFD4A10A36BFE%7D&symbol=

WASHINGTON (MarketWatch) - U.S. nonfarm private payroll-sector payrolls grew by 107,000 in August, according to the monthly Automatic Data Processing national employment report released Wednesday.

"These findings indicate that establishment employment continued to grow sluggishly in August," said Joel Prakken, chairman of Macroeconomic Advisers, the economic forecasting firm that computes the ADP index from anonymous payroll data provided by Automatic Data Processing Inc. (ADP : , , )

Adding in the average 10,000 government jobs created in a typical month in the past year, the ADP report would indicate growth in nonfarm payrolls of about 117,000 in August

The Labor Department will report on the August nonfarm payroll figures on Friday. Economists expect a gain of about 130,000 jobs, including government employment. See Economic Calendar.

In July, the ADP report showed 99,000 net new jobs, while the Labor Department's survey indicated 113,000 new jobs in the private sector.

However, the ADP report got it stupendously wrong in June, when it forecast private-sector gains of 368,000, while the government report showed just 90,000 new jobs created in the private sector and an additional 31,000 government jobs.

...more...

[Nickster]

23. Which means the reality is somewhat less than that. Say 95-100k?

[UpInArms]

17. GamAnonMtg: Derivative traders see Aug US payrolls gain at 120,610

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-08-30T122147Z_01_NYE000036_RTRIDST_0_ECONOMY-PAYROLLS-DERIVATIVES-URGENT.XML

NEW YORK, Aug 30 (Reuters) - Traders are betting on Wednesday that U.S. employers added about 120,610 jobs in August in the first of four derivatives auctions, according to data from the firms holding the auction.

The results were in line with the median forecast for the government's payroll figure among economists polled by Reuters.

The U.S. Labor Department will issue the August payroll report on Friday at 8:30 a.m. ET (1230 GMT).

The derivatives auction on Wednesday covered a wide range of expectations, with a payroll gain of 75,000 to 150,000 drawing about 36.3 percent of trader's bets.

Economists on average expect an increase of 120,000 in nonfarm payrolls in August following a 113,000 rise in July, according to the latest median forecast of economists polled by Reuters.

Investors use the auctions to hedge against unwanted surprises in the report. Traders also use the auctions to speculate on the outcome.

...more...

[specimenfred1984]

48. Speculation Gone Wild!

Speculating on derivatives themselves should be illegal for a number of reasons. A couple of reasons are: it provides a huge incentive for gov't report speculators to get those gov't numbers in advance and, it's so complicated that regulators themselves have a hard time following what's going on.

Excellent post 'UpInArms'!

[Ghost Dog]

24. Euro hits fresh high against yen

http://www.ft.com/cms/s/8c82bfd2-3808-11db-ae2c-0000779e2340.html

The euro hit a fresh record high against the yen for the third straight session on Wednesday as investors continued to sell the low-yielding Japanese currency.

Mitul Kotecha, global head of FX at Calyon, said the main factor behind the yen’s recent decline has been its increasing use as a funding currency as expectations for further rates rises in Japan were pushed back to early next year after recent weak consumer price data. “With eurozone interest rates expected to go higher, the euro is getting the main benefit,” he said.

The euro rose 0.4 per cent to Y150.16 against the yen, having hit an all-time high of Y150.30 in early trade. Unlike in previous assaults on the Y150 level, the euro was able to sustain its gains.

<snip>

On Tuesday, Sadakazu Tanigaki, Japanese finance minister, was quoted as saying that Tokyo was monitoring currency movements “closely” in the wake of the euro’s sharp rise against the yen. According to Mr Shah, these comments might reflect a wider concern that the yen could become an issue for the G7, given its weakness on a trade-weighted basis.

“With Japan a strong competitor with other Asian countries for export market share the yen movements are not something that helps to keep Asia biased toward flexibility,” he said. “The focus on dollar/yen and dollar/Asia and their interactions will become a hot topic heading into the September G7 and International Monetary Fund meetings. The risk is that these meetings cap dollar/yen upside as Japan is once again asked to limit yen weakness in order to keep ‘flexibility’ on the table.”

The yen also lost 0.3 per cent against the dollar to Y117.0, fell 0.3 per cent to Y222.36 against sterling and dropped 0.3 per cent against the Swiss franc to Y95.20 - its lowest level since October 1998.

/...

[Ghost Dog]

25. Tokyo stocks lose gains to close lower

http://www.ft.com/cms/s/ea09ffba-37d8-11db-bc01-0000779e2340.html

Japanese stocks ended the day marginally lower, despite rallying earlier in day on increased expectations of a halt to monetary tightening in the US and lower oil prices.

The Nikkei 225 fell 0.1 per cent at 15,872.02, while the broader Topix fell 0.2 per cent to 1,612.66.

Rubber producers continued to set the pace. Sumitomo Rubber Industries rose 9 per cent to Y1,223. Japan’s second biggest tyre-maker last month lowered its full-year profit forecasts on higher input costs, but investors were cheered by a buy recommendation from Goldman Sachs. The number one tyre-maker, Bridgestone Corp, was up 4.5 per cent at Y2,460.

/...

[Ghost Dog]

26. Europe’s bourses lifted by transport stocks

http://www.ft.com/cms/s/60e11f20-37f1-11db-ae2c-0000779e2340.html

European equities were higher on Wednesday, led by technology and transport stocks as lower oil prices offered support, while a rally in US equity markets also lifted sentiment.

By mid morning, the FTSE Eurofirst 300 was up 0.4 per cent to 1,373.07, while Frankfurt’s Xetra Dax added 0.4 per cent to 5,867.3. In Paris, the CAC 40 gained 0.5 per cent to 5,184.13 and London’s FTSE 100 climbed 0.4 per cent to 5,910.2.

<snip>

EADS, the French aerospace group, continued to benefit from speculation about Russian stakebuilding. State bank Vneshtorgbank was reported by the Russian press on Tuesday to have accumulated a 5 per cent stake in EADS. The French company declined to comment directly but suggested a holding that large would have to be declared to stock market regulators. EADS shares gained 1.8 per cent to €23.40.

Although crude oil prices were a little higher on Wednesday, sharp falls over the past couple of sessions led to gains for those stocks with a high gearing to fuel prices.

Transport stocks were higher, led by Moller-Maersk, the Danish container shipping group, which had the added advantage of reporting upbeat full-year guidance in the previous session. Its shares gained 4 per cent to DKr48,900.

Also in the sector, Deutsche Post, the German logistics and delivery group, added 1.8 per cent to €19.82, while Dutch rival TNT added 1.7 per cent to €29.31.

/...

[Ghost Dog]

33. European stocks up as rate and oil worries ease

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=eurMktRpt&storyID=2006-08-30T111204Z_01_L30153640_RTRIDST_0_MARKETS-EUROPE-STOCKS-UPDATE-2.XML

PARIS, Aug 30 (Reuters) - European shares set fresh 3-1/2 month highs by Wednesday's midsession, helped by easing interest rate worries, relatively tame oil prices at around $70 a barrel, and buoyant technology stocks such as Ericsson (ERICb.ST: Quote, Profile, Research).

<snip>

The FTSEurofirst 300 index <.FTEU3> of leading European shares was 0.5 percent firmer at 1,373.86 points by 1055 GMT, its highest intraday level since May 12, and 2.5 percent away from a five-year peak of 1,407.52 set on May 11.

Sentiment got a shot in the arm late on Tuesday as minutes from the latest Federal Reserve meeting helped cement investors' view that the U.S. central bank was in no hurry to tighten borrowing costs again any time soon.

But strategists expected investors to remain on edge amid concern that the Fed may already have gone one step too far and that current rate levels could lead to a sharper-than-expected slowdown in the world's biggest economy.

Investors were likely to pay close attention to U.S. reports on second-quarter preliminary gross domestic product and core quarterly PCE due for release at 1230 GMT.

"Signs of slowdown in the U.S. economy are catching the market's attention, along with the prospect for inflation to ease and the Fed to keep a monetary status quo," said Francois-Xavier Chevallier at CM-CIC Securities.

Around Europe, London's FTSE 100 (.FTSE: Quote, Profile, Research) index was 0.5 percent higher, Paris's CAC 40 <.FCHI> added 0.4 percent, Frankfurt's DAX <.GDAXI> gained 0.3 percent and the Swiss Market Index <.SSMI> was up 0.2 percent in Zurich.

/...

[Ghost Dog]

29. UK consumers brush off rate rise

http://mwprices.ft.com/custom/ft2-com/html-story.asp?dateid=38959.3600115741-880983160&guid={505EC99B-A594-4E32-A7DC-F63F345FBDB5}

Consumers appear to have brushed off this month’s surprise hike in interest rates with retail sales in August growing at their fastest pace in over 18 months, according to the latest survey from the CBI.

<snip>

Retailers are also optimistic about the immediate future, with a balance of 13 per cent expecting an improvement in September.

Sterling initially spiked higher and money markets shortened the odds on another increase in the cost of borrowing before the year is out as traders also noted signs of building inflationary pressures contained in the report.

The CBI said that despite intense competition, retailers have been more successful in passing on the high costs of energy and foodstuffs. A positive balance of 12 per cent of retailers said their average prices had risen in August. This is the first time in two years they have been able to make mark-ups stick and respondents expect further increases in the months ahead.

So, passing increased energy & food costs onto consumers is seen as a good thing in the UK... with inflation controlled by interest rates & slowing 'productive' economy. Well, there's precious little productive economy - it's mostly services including financial services, and the house-price boom really does seem to be landing softly (and even bouncing) at present (although there's now no way the lower-paid majority can afford to buy a house unless via inheritance.

[Ghost Dog]

32. FTSE up on takeover talk around banks, life insurers

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=londonMktRpt&storyID=2006-08-30T101921Z_01_IRE037149_RTRIDST_0_MARKETS-BRITAIN-STOCKS-UPDATE-2-20060830.XML

LONDON (Reuters) - Britain's FTSE 100 index (.FTSE: Quote, Profile, Research) rose on Wednesday on hopes of a halt in U.S. interest rate rises and takeover talk around banks and life insurers, but steelmaker Corus (CS.L: Quote, Profile, Research) fell after reporting disappointing results.

"The markets were delighted by the Fed minutes and have followed the turnaround on Wall Street," said Mike Lenhoff, chief strategist at Brewer Dolphin, referring to Tuesday's release of minutes from the last Federal Reserve rate-setting meeting.

"The market is getting a shot in the arm from the likely cap on U.S. rates, which is favouring cyclical stocks over defensives."

By 1005 GMT the FTSE 100 index of the UK's leading shares was up 24.4 points or 0.4 percent at 5,912.7, adding to Tuesday's 9.7 point rise.

/details...

[54anickel]

39. Japan's Fuzzy Math and European Scare Tactics

http://www.321gold.com/editorials/sirchartsalot/dorsch083006.html

"If Liars can figure, then figures can lie." How should one react to Tokyo's fuzzy math, after government apparatchniks added 34 items to the Japanese consumer price index, whose prices on balance were falling, and removed 48 goods and services that were becoming more expensive? The fuzzy math produced a stunning two-thirds decline in Japan's core consumer inflation rate to 0.2% in July, from the 0.6% inflation rate reported in June, jolting Japanese interest rates.

Tokyo's new methodology for computing the core rate of consumer inflation, included revisions for all the 2006 data, and the difference is dramatic. In the month of May for instance, the new core CPI base showed zero inflation, compared with a 0.6% annualized rate under the previous rules. If correct, the Bank of Japan made a mistake in dismantling quantitative easing in March and in raising rates in July.

In an age when governments of every political stripe distort data to promote their self interests, it's hardly surprising that the new formula for computing inflation suits the interests of Japan's LDP party. By the same token, it is entirely natural for official inflation data to be wildly at odds with the reality faced by business and consumers, and is often regarded with cynicism and disbelief.

Behind Tokyo's sleight of hand, is a power play between the Japan's ministry of finance, which aims to block Bank of Japan chief Toshihiko Fukui, from tightening monetary conditions. Already, Fukui has drained 22.7 trillion yen ($200 billion) from the banking system since March 9th, after dismantling a five year ultra-easy policy that pegged the overnight loan rate at zero percent.

more...

[Ghost Dog]

43. Yup: Sushi, doughnuts play a role in BOJ mistake

http://www.insidebayarea.com/business/ci_4259769
By William Pesek, Bloomberg News

NOTHING cheers bond investors like a tame inflation report. Such was the case last week when it was announced Japan's consumer prices in July rose less than expected. Like clockwork, Japanese bond prices jumped. The buying reflected hopes the scant 0.2 percent increase in core consumer prices, which exclude fresh food, would keep the central bank from raising interest rates for a second time this year. Yet what the latest inflation data really suggest is that the Bank of Japan messed up — again.

<snip>

Last week's report exacerbates my concern that it may be 2000 all over again for the world's No. 2 economy. In August of that year, the BOJ raised rates from zero prematurely. It reversed course 10 months later when it was clear that deflation was worsening.

This time, deflation isn't the issue, yet the BOJ created unnecessary economic headwinds by scrapping its quantitative- easing efforts in March and raising the benchmark overnight lending rate to 0.25 percent from zero on July 14. If I'd bumped into BOJ Governor Toshihiko Fukui after last week's inflation report, I would have asked: "So, are you going to reverse last month's rate hike?"

If only Fukui had read reports from economists such as Richard Jerram of Macquarie Securities Ltd. in Tokyo. On March 7, for example, Jerram published one titled "Risk of a BOJ Mistake," in which he detailed his concerns that the central bank was overoptimistic about the outlook for inflation.

Admittedly, data revisions aren't helping the BOJ. Pencils and sewing machines were among 48 goods and services removed from the latest consumer-price index as part of a review made every five years to better reflect household-spending patterns. Among the 34 items added were flat-panel televisions, doughnuts and discount sushi served on a conveyor belt. The revision lowered monthly inflation by about 0.5 percentage point, according to the government statistics bureau, more than double economists' projections.

Sushi and doughnuts aside, the BOJ seems to have forgotten that as much as central banking is about printing money and taking it out of an economy, it's about communication. By raising rates, the BOJ hoped to communicate that inflation is on the way. Price sentiment must be backed up by official and anecdotal evidence to be maintained.

As time goes on and the BOJ's belief that inflation is a risk proves wrong, a central bank that already has little credibility will have even less. Somehow, markets have given the BOJ a pass because both of its major policy steps this year — in March and July — were leaked to the media. The central bank won't receive a pass for again getting in the way of Japan's recovery.

The lack of inflation may confirm investor concerns that the BOJ isn't acting on economic trends, but in spite of them. The idea is that the central bank was so anxious to get rates away from zero that it tightened credit prematurely.

<snip>

Clearly, the 3.4 percent increase in producer prices in both June and July gave bond traders reason for pause. It raised questions about whether companies will begin passing on rising costs to consumers. So far, though, that's not happening broadly. It's also worth noting that the gross-domestic-product deflator, a broad measure of prices used to derive real growth from nominal growth, fell 0.8 percent in the second quarter from a year earlier. While it was the smallest decline since 2004, it's still declining.

It's ironic that politicians and pundits refused to pressure Fukui to resign in June over his investment in a fund created by now indicted shareholder activist Yoshiaki Murakami. Folks looked the other way because Fukui was thought to be the only person capable of running Japan's central bank. Now, it seems the supposedly omnipotent and irreplaceable Fukui has pulled a Hayami. The reference here is to Fukui's much- maligned predecessor, Masaru Hayami, whose trigger-happiness in August 2000 set back Japan's efforts to end deflation.

/...

[54anickel]

28. The myth of central banks and inflation

http://news.yahoo.com/s/ft/20060829/bs_ft/fto082920061459015527

Central banks' near universal success in bringing down inflation over the past two decades has led many policymakers to conclude that they have pretty much solved the problem of high inflation, once and for all. Market participants have bought into this story, as evinced by a host of quantitative and survey measures. Outside a few developing countries, nobody seems to worry much about a sustained bout of 5 per cent or 6 per cent inflation, much less the double-digit levels of the 1970s. But have central bankers truly slain the hydra of inflation?

The advent of modern independent and anti-inflation-oriented central banks is one of the great success stories of modern economic science. But this story has been exaggerated. We should consider the possibility that the unprecedented pace of modern globalisation, recently emphasised by Ben Bernanke, the Federal Reserve chairman, might also have played a role. If so, what will happen if the winds of globalisation ever reverse course?

Why should globalisation matter for inflation? A very popular but wrong-headed view is that "China exports deflation", so that more rapid growth in China automatically translates into lower inflation everywhere. This is nonsense. As long as a central bank has monopoly control over its currency, as most do, it can set medium and longer term inflation trends at any level it likes. If the central bank really wants to stabilise the country's overall inflation rate, it will respond to lower import prices by allowing an offsetting rise in the prices of domestic goods. In this sense, it would be more accurate to say that China exports inflation rather than deflation.

Instead, one should think of the modern era of rapidly expanding trade and technology progress as providing a spectacularly favourable milieu for monetary policy. With hugely positive underlying trends, central banks have been able to establish and maintain low inflation while delivering growth results that have often outperformed expectations. Rather than face the usual historical trade-off, central banks have let citizens have their cake and eat it. No wonder central bankers have become so popular.

But precisely because globalisation has produced such a steady stream of upward surprises, there is an element of illusion to central banks' success, as most people have only sluggishly adjusted their expectations to the faster growth trends. Consider the ­performance of Alan Greenspan, the recently retired Fed chairman. Mr Greenspan famously got a number of big calls right, including his early ­recognition of the productivity boom in the 1990s, as well as his aggressive proactive responses to the tragedy of September 11 2001, the 1998 Russian debt crisis and the 1987 stock market crash. In each of these cases, Mr Greenspan's big call was to slash interest rates and pour liquidity into the system, leading markets to believe that the Fed would always insure the downside of the economy without taking away any of the upside.

more...


Here's a link to some of the papers presented in Jackson Hole

http://www.kc.frb.org/PUBLICAT/SYMPOS/2006/sym06prg.htm

The one titled "The Rise of Offshoring: It's not Wine for Cloth Anymore" will get your blood boiling. If you want to save yourself the aggrevation of pouring through 35 pages of BS, you could just skim through the intro the just jump to the very last line of the Conclusion:

Our calculations admittedly are crude and so must be taken with a grain of salt until a more thorough empirical study can be performed

[UpInArms]

31. 8:45 EST numbers and (updated) blather

Dow 11,372.66 +2.72 (+0.02%)
Nasdaq 2,171.22 -1.08 (-0.05%)
S&P 500 1,304.59 +0.31 (+0.02%)
10-Yr Bond 4.769 -0.014 (-0.29%)

NYSE Volume 141,512,000
Nasdaq Volume 102,249,000

09:40 am : Stocks open in lackluster fashion as a report showing economic activity grew less than expected last quarter fails to get investors overly excited during another session light on the news front. Earlier, the Commerce Dept. reported an upward revision in Q2 GDP growth, to 2.9% (consensus 3.0%) from 2.5%, providing no proof that a recession or anything close is developing. However, the dated nature of the GDP data has left investors wanting more evidence that the Fed will remain on hold with its tightening and their focus squarely on tomorrow's core-PCE index -- the Fed's primary inflation indicator -- and Friday's influential jobs report. DJ30 +1.12 NASDAQ +0.32 SP500 +0.05 NASDAQ Vol 94 mln NYSE Vol 72 mln

09:15 am : S&P futures vs fair value: flat. Nasdaq futures vs fair value: +1.5.

09:00 am : S&P futures vs fair value: -0.5. Nasdaq futures vs fair value: +1.5. Futures versus fair value now point to a mixed open for the indices, but the lack of conviction on the part of buyers questions the sustainability of this week's gains amid another slow news day and heading into another session devoid of Wall Street's heaviest hitters. While the recent GDP report places it near the long-term trend of 3%, easing major concerns that economic growth is slowing too rapidly, the dated nature of the report has lessened some of its impact as a trading catalyst.

08:32 am : S&P futures vs fair value: -0.6. Nasdaq futures vs fair value: flat. Futures trade holds relatively steady, still indicating a sluggish open for equities following economic data. As expected, Q2 GDP was adjusted higher, up to 2.9% (consensus 3.0%) from 2.5%, as inventories and business investment are revised to reflect stronger growth, while the chain deflator -- a key inflation measure -- held steady at 3.3%. Bonds, which were flat ahead of the report, have also barely budged, as the 10-yr note remains unchanged to yield 4.77%.

[Tace]

44. MOGAMBO GURU: These Horrific Things Apparently Mean Nothing To Anyone

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

snip

At this outrage, I leapt to my feet in anger and ran up to the television screen, and putting my nose so close to the screen that I am sure they must be able to see me, I am yelling "Why? Do you want to know why globalization progressed so fast and so far, you morons?" That was supposed to be just a rhetorical question, but suddenly the whole family started whining, and the kids are crying, "Mom! Mom! Make him stop! For the love of God, mom, please make him stop!" and my oldest daughter is looking comically heavenward and wailing, "O, Death, where is thy sting?"

And then the wife pipes up and says, "No, dear, we do NOT want to know why, because we already know why! It's because of the Federal Reserve, isn't it?" Before I could admit that it was, she snarls, "Isn't it? Admit it, you big blowhard Mogambo bastard (BBMB)! Admit that it's because of the Federal Reserve! Go ahead! Admit it!" and I replied, in my usual Witty Mogambo Way (WMW), "Shut up, shut up, shut up! All of you just shut the hell up!" And then I ran out, my little heart breaking, and my eyes stinging with bitter, bitter tears.

Later, after having a few drinks with my new close friends down at the nearest bar that has cheap, greasy food and cheap liquor (served in greasy glasses), I realized that she was right. It was because of the Federal Reserve! But that brought up the odd question; if my family can figure it out, then how come the only guys who can’t figure it out are the Federal Reserve and the guys whose living depends on toadying to the Fed so that they can go to swell conferences and act important and charge clueless clients the big money?" Then I thought, "Maybe they don’t know!

This is when I hit upon my Fabulous Mogambo Idea (FMI). My idea was to rent a moose suit and go to Jackson Hole. Masquerading as a real moose, I would casually wander up, all docile and cutesy-wootsie moosey-like, close enough to the conference to get everyone's attention. Then I would bellow, really moose-like, "The Spirit of the Moose says: Send me Ben Bernanke!" And then he would come out and say, "What do you want, moose?" Then, dramatically, I would heroically jump out of the moose suit and shout, in a thick, Boris Badenov and Natasha-type Russian accent, "Ha! It is neither moose nor squirrel, but I, The Mogambo!"

more

http://www.worldnewstrust.com/content/view/42/lang,en/

[AnneD]

55. I hate to burst the great Magambo's

bubble, but the moose's natural range does not include Wyoming. He would stick out like a sore thumb. Besides, that is Cheney's back yard....would you really want to risk a face full (or some other anatomical area) of buckshot?

[54anickel]

51. 12:15 update and I've gotta run....

Dow 11,369.22 -0.72 (-0.01%)
Nasdaq 2,178.78 +6.48 (+0.30%)
S&P 500 1,302.62 -1.66 (-0.13%)
10-yr Bond 4.767 -0.016 (-0.33%)
30-yr Bond 4.917 -0.013 (-0.26%)
NYSE Volume 929,413,000
Nasdaq Volume 768,223,000

12:00 pm : Underscoring the epitome of summer doldrums, the major averages are trading in split fashion midday as another session devoid of Wall Street's heaviest hitters offers little conviction behind what is merely shaping up to be nothing more than a day of selectively picking up bargains.

Before the bell, the Commerce Dept. showing an upward revision in Q2 GDP growth, to 2.9% (consensus 3.0%) from 2.5%, provided no proof that a recession or anything close is developing. Be that as it may, the dated nature of the GDP report has left investors wanting more evidence that the Fed will remain on hold with its tightening efforts and refocused their attention squarely on tomorrow's core-PCE index -- the Fed's primary inflation indicator -- and same-store sales results for August, especially in the wake of a profit warning from Costco Wholesale (COST 47.05 -2.20) which has exacerbated concerns about consumer spending.

Meanwhile, oil prices hitting two-month lows has allowed participants to lock in more of the Energy sector's 16% year-to-date gain and rotate into underperforming areas, especially Technology, which is garnering the bulk of buying interest. Crude oil futures are down 1.2% and below $69 a barrel following unexpected builds in weekly gasoline supplies and crude oil inventories. Unfortunately for the bulls trying to extend two days of market gains, the absence of leadership from the very sector most responsible for the S&P 500's 4.5% year-to-date advance, leaves more modest gains in other sectors less of a chance from offsetting Energy's 1.8% sell-off. DJ30 -3.82 NASDAQ +4.49 SP500 -1.60 NASDAQ Dec/Adv/Vol 1080/1691/725 mln NYSE Dec/Adv/Vol 1081/1996/550 mln

11:30 am : More of the same for stocks as bargain hunters remain in control of early action, as evidenced by the majority of leadership being found among some of this year's biggest disappointments. No where else has this been more apparent than on the Nasdaq, which is again outpacing the Dow and S&P 500 to the upside, as investors remain committed to selectively picking up issues in beaten-down areas, especially in technology. Computer Storage and Communication Equipment are both up more than 14% this year and are among the top five best performing industry groups. DJ30 +25.45 NASDAQ +11.50 SP500 +1.17 NASDAQ Dec/Adv/Vol 996/1721/602 mln NYSE Dec/Adv/Vol 979/2047/468 mln

11:00 am : Market is holding on to modest gains as further deterioration in oil prices eases inflation fears and continues to improve overall sentiment. Crude oil futures are now down 1.0% and below $69 a barrel following unexpected builds in weekly gasoline supplies and crude oil inventories as well as reports that Tropical storm Ernesto has been downgraded to a Tropical Depression. While another pullback in crude removes notable leadership in the Energy sector (-1.3%), oil's decline is allowing investors to lock in more of the sector's 16% year-to-date surge and rotate into underperforming areas. To wit, Internet Retail (+2.5%), Tires & Rubber (+2.1%) and Insurance Brokers (+1.2%) -- three of this year's ten worst performing S&P industry groups, are among today's ten best performers.DJ30 +24.01 NASDAQ +9.49 SP500 +1.07 NASDAQ Dec/Adv/Vol 949/1724/492 mln NYSE Dec/Adv/Vol 974/1997/380 mln

10:30 am : Indices bounce of morning lows and have inched back above the flat line, spearheaded by improved leadership in Technology (+0.4%). Notable turnarounds have been seen in IBM (IBM 81.55 +0.15) and Intel (INTC 19.71 +0.03) while tech is garnering even more support from Apple Computer (AAPL 67.55 +1.07) , which is up 1.6% after it added Google (GOOG 384.16 +5.21) CEO Eric Schmidt to its board, while SanDisk (SNDK 57.30 +1.19) is up 2.1% following positive commentary and upwardly revised estimates from Bear Stearns.DJ30 +18.49 NASDAQ +5.89 SOX +0.3% SP500 +0.86 NASDAQ Dec/Adv/Vol 1066/1492/338 mln NYSE Dec/Adv/Vol 1157/1737/254 mln

10:00 am : Major averages are now on the defensive but mixed industry leadership offers little conviction on either the bullish or bearish side of the aisle. Of the five sectors trading lower, Energy is pacing the way (-0.8%) as an analyst downgrade on Marathon Oil (MRO 86.47 -1.43) overshadows a modest rebound in oil prices while Utilities, with the Dow Jones Utilities Average only a day removed from hitting all-time highs, is consolidating recent gains. Among the five sectors in positive territory, only one is posting a gain of more than 0.2%, and that's Telecom, which to the dismay of the bulls struggling to extend two days of market gains, is one of the least influential areas within the S&P 500.DJ30 -8.80 DJUA -0.9% NASDAQ -2.85 SP500 -1.25 NASDAQ Dec/Adv/Vol 1191/1149/192 mln NYSE Dec/Adv/Vol 1008/1665/148 mln

[UpInArms]

54. 1:51 EST numbers and blather

Dow 11,381.63 +11.69 (+0.10%)
Nasdaq 2,184.06 +11.76 (+0.54%)
S&P 500 1,304.46 +0.18 (+0.01%)
10-Yr Bond 4.757 -0.026 (-0.54%)

NYSE Volume 1,267,715,000
Nasdaq Volume 1,049,379,000

1:30 pm : Buyers and sellers remain virtually deadlocked as the blue chip averages continue to hold their own around the unchanged mark. Bonds, however, have recently extended their reach to the upside following a strong 5-year note auction. The bid-to-cover ratio of 3.11 was the highest in nine years while indirect bidder participation checked in at 27.7%, the highest since 28.5% in January. The 10-year yield is now up 6 ticks and at session highs to yield 4.75%.DJ30 +5.28 NASDAQ +10.09 SP500 -0.94 NASDAQ Dec/Adv/Vol 1088/1779/988 mln NYSE Dec/Adv/Vol 1166/1994/748 mln

1:00 pm : Indices remain mired in relatively tight trading ranges as investors find few catalysts to prompt much follow-through buying interest in anything other than technology. Of the 14 Dow components trading higher, a 1.6% surge from one of the blue-chip index's highest priced stocks -- Boeing (BA 74.99 +1.21), and a recent spike higher in Merck (MRK 41.10 +0.21), after a U.S. Judge overturned a $50 mln Vioxx award against the drug giant, are two of the only reasons behind the Dow's recent uptick into the green. After all, a 2.2% drubbing on Exxon Mobil (XOM 67.92 -1.49), the most heavily weighted component on the S&P 500, is still largely responsible for the broader market's inability to follow suit to the upside.DJ30 +8.81 NASDAQ +10.93 SP500 -0.46 NASDAQ Dec/Adv/Vol 1145/1704/905 mln NYSE Dec/Adv/Vol 1158/1968/690 mln

[Ghost Dog]

57. ANALYSIS - Nations scour for wheat as drought shrivels supply

http://www.ndtvprofit.com/homepage/news.asp?id=265405

SINGAPORE (Reuters) - From Australia to Argentina, erratic weather is slashing wheat crops of the major producers, which is threatening to push up prices to multi-year highs and making it difficult for countries to replenish stocks.

While the world's carryover stocks could cushion the blow, the crop woes coincide with rising demand from Europe and India, which is grappling a with a huge shortfall.

Appetite for feed wheat for livestock is also likely to grow as mills cut the usage of corn because its price has soared on strong demand from ethanol makers.

"It is going to be a year of tight supplies," said Mark Samson, vice president for South Asia of the U.S Wheat Associates. "And with expectations of high world prices, more hedge funds are increasingly paying attention to this market." The interest of investment funds in grains is growing and helping to push up prices. The Deutsche Bank Fund now allocates 22.5 percent of its investment funds to wheat and corn trading.

"Wheat prices are firm now and could still go higher," said Antonio Moraza, president of Pilmico Foods Corporation, a Philippines-based flour milling firm.

U.S. spring wheat has risen more than 15 percent to above $200 a tonne from last year on concerns about supply.

The United States had one of the hottest summers since the Dust Bowl years of the 1930s. The U.S. Agriculture Department has forecast output will fall 14 percent to 1.80 billion bushels, the smallest crop in four years.

The USDA expects the drought to push U.S. prices to its highest levels in 10 years.

Meanwhile, Australia's production is expected fall up to 30 percent from last year's 25 million tonnes due to dry weather and Europe also expects a lower wheat crop following a sweltering summer. This, coupled with rain in the final harvest stages, has downgraded a substantial amount of wheat to feed quality.

Canada, also plagued by hot weather, expects its wheat output to fall to 25.9 million tonnes from 26.8 million in 2005.

Argentina, which last year produced 12.5 million tonnes of weheat, has repeatedly lowered its forecast due to dry weather but has yet to issue a forecast.

/more...

[AnneD]

60. 54anickel.....

was it you that called the wheat last week.....ZANG:thumbsup:
Bad for us but good call. This is where you make money on this thread if you've a mind.

[54anickel]

63. Heh-heh, I feel like Billy Ray Valetine in Trading Places...n/t

[UpInArms]

61. closing and blather

Dow 11,382.91 +12.97 (+0.11%)
Nasdaq 2,185.73 +13.43 (+0.62%)
S&P 500 1,304.27 -0.01 (-0.00%)
10-Yr Bond 4.763 -0.02 (-0.42%)

NYSE Volume 1,982,779,000
Nasdaq Volume 1,698,705,000

Even though the blue chip averages closed in lackluster fashion, the Nasdaq put together another respectable performance Wednesday. However, another thinly-traded session as Labor Day weekend draws near provided little conviction behind today's follow-through efforts. In fact, the day's action can best be described as simple sector rotation, as a sense that Energy (-1.6%) has recently topped out prompted bargain hunters to keep buying beaten-down areas throughout the struggling Tech sector (+0.9%).

Before the bell, a government report showed the economy in Q2 slowed less than initially reported, easing concerns that economic growth was slowing too rapidly and providing some early support. Be that as it may, the dated nature of the GDP report left investors wanting more evidence that the Fed will remain on hold with its tightening efforts and refocused their attention squarely on tomorrow's core-PCE index -- the Fed's primary inflation indicator -- especially after a more than 2% swing in oil prices actually closed the commodity up 0.5% on the day and back above $70 a barrel. Crude oil futures were off more than 1.5% following unexpected builds in weekly crude oil and gasoline inventories, contributing to a 1.6% sell-off in the most influential component on the S&P 500 -- Exxon Mobil (XOM 68.32 -1.09). Fears that Iran will not comply with the U.N. by tomorrow's deadline helped oil close higher, but Exxon Mobil failed to recoup most of its losses and weighed heavily on the broader market.

With tomorrow's focus also on same-store sales results for August, a profit warning from Costco Wholesale (COST 47.18 -2.07) exacerbated concerns about consumer spending and merely left tech investors as the only participants still looking to selectively pick up stocks in areas that have been among this year's worst performers. Technology, which is still this year's worst performing sector, has outpaced all other sectors this month and is up more than 8% ever since the market strated to believe the Fed won't go too far with its tightening effort. To wit, the tech-heavy Nasdaq is up 4.5% during what is historically one of the worst months (August) of the year for stocks, according to the Stock Traders Almanac. DJ30 +12.97 NASDAQ +13.43 SOX +1.8% SP500 -0.01 XOI -1.4% NASDAQ Dec/Adv/Vol 1176/1852/1.65 bln NYSE Dec/Adv/Vol 1170/2100/1.28 bln