STOCK MARKET WATCH, Monday 30 August

[ozymandius]

Monday August 30, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 143
DAYS UNTIL W* GETS HIS PINK SLIP 64
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 262 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 316 DAYS
WHERE ARE SADDAM'S WMD? - DAY 529
DAYS SINCE ENRON COLLAPSE = 1012
Number of Enron Execs in handcuffs = 19
Recent Acquisitions: Ken Lay
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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

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AT THE CLOSING BELL ON August 27, 2004

Dow... 10,195.01 +21.60 (+0.21%)
Nasdaq... 1,862.09 +9.17 (+0.49%)
S&P 500... 1,107.77 +2.68 (+0.24%)
10-Yr Bond... 4.23% UNCH (UNCH)
Gold future... 405.40 -4.70 (-1.16%)





GOLD, EURO, YEN and Dollars

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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

---

[UpInArms]

1. daily dollar watch

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

Last trade 89.71 Change -0.06 (-0.07%)

http://futures.fxstreet.com/Futures/content/100480/content.asp?menu=review&dia=3082004

<snipping out lots of charts and info>

The Economy:

Durable Goods Orders rose 1.7 percent in July, reversing the declines seen the past several months according to the Commerce Department. The boost came from passenger aircraft. Take transportation out and Durable Goods Orders were up a minuscule 0.1 percent. The Fed reported that Capacity Utilization was also up, operating at 76.3 percent in July, the best in three years.

The Commerce Department revised 2nd quarter GDP down to 2.8 percent from a previously reported 3.0 percent. Don't you just love the M.O. for this administration. Spin, spin, spin. Repeatedly we see bogus optimistic numbers reported only to be revised lower later when nobody really cares. This adds a new dimension to the Fundamental Analysis approach to investing versus the Technical Analysis approach. Fundamental Analysis essentially says invest based upon the news, the economic statistics, and forecasts of such, since they drive corporate earnings, and corporate earnings drive stock prices. Well, not only do we TA folks believe that approach is false, but even if there was an ounce of truth to it, you can't get honest numbers anymore. By the way, if anyone wants to argue that corporate earnings drive stock prices, please read John Mauldin's excellent book, Bull's Eye Investing. Returns on stocks are far more a function of dividends and price/earnings multiples people are willing to pay than the actual earnings themselves.

Real Estate is on the ropes. Will it go down for the ten count? Mortgage Applications fell 6.3 percent for the week ended August 20th according to the Mortgage Bankers Association. Existing Home Sales fell 2.9 percent in July according to the National Association of Realtors. New Home Sales fell a whopping 6.4 percent in July according to the Commerce Department. Inventories of unsold homes rose to 4.2 months, the highest level in a year and a half.

<more snipping>

Money Supply, the Dollar, and Gold

There has essentially been no change in M-3 over the past 13 weeks. This zero percent annualized growth rate no doubt has helped buoy the U.S. Dollar. Our research has found that whenever M-3 rises, equities rise, and whenever M-3 plateaus or falls, equities decline. M-3's zero percent rate of change over the past three months supports our view that a significant equity slide is forthcoming.

The U.S. Dollar sits at the top of its long-term declining trend-channel. It has also formed the makings of a textbook Head & Shoulders top. To complete the H&S pattern, prices must break below 87. Should they do so, the minimum downside target is 82. Should prices break decisively above 90, the long-term down-trend will be broken, and the forecast for the Dollar will be up. Which way will it go? Well, the RSI is nearing a top and the MACD is rising, but its rise is slowing. That suggests down.

...lots more at link...

http://futures.fxstreet.com/Futures/content/100270/content.asp?menu=currencies&dia=3082004

THE CURRENCY REPORT

The DX opened higher at our Filter level of 89.37, slid to a morning Lo of 89.34 and started to rise to a morning Hi at our secondary Resistance level of 89.80 after a better than expected U of Michigan Consumer report of 95.9 vs. expected 94.0. Prices continued higher, hitting a daily Hi of 89.89, before drifting lower towards the close as traders closed their books and awaited a ‘hectic’ week in NYC, with the GOP convention. Mr. Greenspan had very little impact on the markets, as his comments reflected little abount the economy or interest rate direction. The DX ended the day at our secondary Resistance level of 89.80, up 45 tics and up 53 tics for the week. The trend is ‘up’ and momentum indicators are favorable as we approach the key 50% Fib level of 90.00. Key economic data this week will culminate with the Non-Farms Payroll on Friday. A higher open should find Resistance at 90.07 and 90.35, while an open below 89.62 may find Support at 89.34 and 88.89. The COT report shows commercials liquidating ‘longs’ and adding to their ‘shorts’, decreasing their Net Long position to 3488 contracts

...more...

[54anickel]

9. YIKES!!! That chart!

60% chance of a substantial decline (800 points+) for the DOW in the Intermediate term (12 weeks).

60% chance of an market decline (200 - 800 points) for the DOW in the short term (2 weeks).

[UpInArms]

10. this chart?

[54anickel]

12. YES, and this one as well. Along with the tables for short and

intermediate trends at the beginning of the article.
The entire post is one big YIKES! :wow:

[UpInArms]

2. Hedge Fund Is Censured and Ordered to Pay Taxes

http://www.nytimes.com/2004/08/28/business/28long.html

A federal judge ruled yesterday against Long-Term Capital Management, the mammoth hedge fund whose collapse in 1998 roiled world markets, finding that the fund acted in bad faith when it took $106 million in tax deductions.

The decision upheld the $40 million tax bill plus two penalties, for gross misstatement and for understatement, that will raise the total amount owed the government to nearly $56 million. Long-Term had paid part of the $40 million after an audit and had later sued for a refund.

In a harshly worded decision with major importance for hedge funds and their investors, the judge, Janet Bond Arterton of Federal District Court in New Haven, effectively painted Long-Term Capital as an abusive tax shelter.

<snip>

The judge's 196-page decision was also critical of one Long-Term Capital partner, Myron S. Scholes, a winner of a Nobel in economics. Mr. Scholes's work was central to the tax deductions in the case.

In the ruling, Judge Arterton upheld the Internal Revenue Service's claim that Long-Term Capital improperly deducted more than $106 million in 1996 and 1997 as well as the agency's assessment of two large penalties - one for gross misstating and the other for understating its tax liabilities. By law, only the larger of the two penalties - 40 percent of $40 million - actually must be paid.

<snip>

Hedge funds are secretive, unregulated investment pools for the very wealthy that carry big rewards but big risks. Long-Term's unraveling came after the collapse of Russian financial markets in 1998. The Federal Reserve orchestrated a $3.65 billion bailout by a consortium of banks.

<snip>

O.T.C., as a foreign entity, is not subject to United States taxes. The other four transactions were called Trucking Investment Portfolios, or Trips, and involved leases of fleets of Wal- Mart trucks.

...much more...

[Tandalayo_Scheisskopf]

6. When are these guys...

Gonna get the RICO statute crammed up their cloacal vents? Do they break the law on any particular schedule or just when the spirit moves them?

[UpInArms]

13. Meanspin is their guardian angel

http://www.federalreserve.gov/boarddocs/testimony/19981001.htm

excerpt:

Testimony of Chairman Alan Greenspan
Private-sector refinancing of the large hedge fund, Long-Term Capital Management
Before the Committee on Banking and Financial Services, U.S. House of Representatives
October 1, 1998

excerpt:

LTCM is a hedge fund, or a mutual fund that is structured to avoid regulation by limiting its clientele to a small number of highly sophisticated, very wealthy individuals and that seeks high rates of return by investing and trading in a variety of financial instruments. Since its founding in 1994, LTCM has had a prominent position in the community of hedge funds, in part because of its assemblage of talent in pricing and trading financial instruments, as well as its large initial capital stake. In its first few years of business, it earned an enviable reputation by racking up a string of above-normal returns for its investors.

LTCM appears principally to have garnered those returns by making judgments on interest rate spreads and the volatilities of market prices. In its search for high return, LTCM levered its capital through securities repurchase contracts and derivatives transactions, relying on sophisticated mathematical models of behavior to guide those transactions. As long as the configuration of returns generally mimicked their historical patterns, LTCM's mathematical models of asset pricing could be used to ferret out temporary market price anomalies. Their trading both closed such price gaps and earned an extra bit of return on capital for them. But it is the nature of the competitive process driving financial innovation that such techniques would be emulated, making it ever more difficult to find market anomalies that provided shareholders with a high return. Indeed, the very efficiencies that LTCM and its competitors brought to the overall financial system gradually reduced the opportunities for above-normal profits. Indeed, LTCM acknowledged this when returning $2-3/4 billion of capital to investors at the end of 1997. To counter these diminishing opportunities, LTCM apparently reached further for return over time by employing more leverage and increasing its exposure to risk, a strategy that was destined to fail. Unfortunately for its shareholders, LTCM chose this exposure just as financial market uncertainty and investor risk aversion began to rise rapidly around the world.

[UpInArms]

14. and just because this pisses me off so much,

here's some more:

http://www.reuters.com/financeNewsArticle.jhtml?type=bondsNews&storyID=6060175

Hedge funds don't need more regulation-Greenspan

WASHINGTON, Aug 24 (Reuters) - U.S. hedge funds do not need more regulation or monitoring, Federal Reserve Chairman Alan Greenspan said in written responses released on Tuesday to questions from lawmakers.

"There is no evidence that investors in hedge funds today are any less sophisticated than they were in 1999," Greenspan wrote in answer to a question from Senate bank panel Chairman Richard Shelby about whether the Fed chief had rethought a 1999 President's Working Group decision not to force hedge fund managers to register as investment advisers.

"Indeed, institutional investors have accounted for a growing share of hedge fund investments, and they can and should protect their own interests rather than rely on the limited regulatory protections that would be provided as a result of a registration requirement," he added.

Greenspan's views differ in part with those of U.S. Securities and Exchange Commission Chairman William Donaldson, who has sought to require hedge funds to register with the agency for the first time.

...more...

and how does all that square with info in the NYT's article?

excerpt:

The entity then borrowed more than $6 million from Long-Term, and invested an almost identical sum with Long-Term in the form of cash and stock. Later it cashed out of the deal, collecting a $1 million commission from Long-Term. Long-Term then claimed a tax loss of $106 million on a small part of the stock that O.T.C. had, in effect, sold to Long-Term for the $1 million fee. Long-Term intended to take deductions on this stock that would have saved it $500 million in taxes, according to an analysis prepared by Mr. Scholes.

Mr. Scholes, in testimony, said he knew as the author of a textbook on business taxes that for this deal to survive an I.R.S. audit it had to make a profit apart from any tax benefits. He explained at trial how he helped fashion the deal so it would show a profit of about $1 million apart from the tax benefits.

But his testimony was undone by Charles Hurley, a Justice Department trial lawyer, who showed that Mr. Scholes sought a bonus that exceeded the nontax value of the deal, wiping out the nontax economic benefits.

:argh:

[54anickel]

30. A giant hedge fund

http://www.economist.com/finance/displayStory.cfm?story_id=3128013

JOSEF ACKERMANN, the Swiss chief executive of Deutsche Bank, is back in charge, but for how long? His aides insist that the Mannesmann trial, in which charges against him and others for awarding excessive bonuses were dismissed in late July, did not distract Mr Ackermann from running the bank. Perhaps not; but in that time his credibility has been weakened by a number of setbacks.

Profits from investment banking, on which he and his closest officers stake their reputation, sagged in the last quarter. Aggressive trading by Deutsche, either for clients or its own account, has drawn the attention of regulators. Worst of all was the bank's widely criticised decision, two months ago, not to buy Postbank, Germany's biggest retail bank. Such a purchase would have sent a strong signal that Mr Ackermann cares about broadening Deutsche Bank's domestic base.

It would, however, have meant a volte-face. For Mr Ackermann and his ten-man group executive committee have taken Deutsche in precisely the opposite direction. Since 1996, they have been transforming it from a giant institution serving German commerce to a global money machine with no particular national loyalty. The bank has given up on its ambition to become a financial supermarket like the mighty Citigroup. Now it increasingly models itself on Goldman Sachs—which does not shirk from taking risk—to the detriment of its other existing and potential businesses. According to one joke circulating in Frankfurt, the German financial centre where the bank is based, Deutsche is actually run by an Indian “bond junkie”: Anshu Jain, its head of markets.

Mr Ackermann and Rolf Breuer, head of Deutsche Bank's supervisory board, would argue that the German bank had no choice. Its domestic market is fragmented and impossible to consolidate because of regional politics. Adventures abroad, and the reduction of lending until it became profitable were the only courses open to it. And they can point to the strategy's success: Deutsche managed a 21% return on equity in the past two quarters; only Commerzbank came close with 15.6%.

more...

[54anickel]

31. Experts Assess the Influence of Long-Term Capital's Loss

http://www.nytimes.com/2004/08/30/business/30tax.html

In the end, the Nobel prizes, doctoral degrees and dizzying financial transactions could not obscure what Long-Term Capital Management was doing, according to a court ruling on Friday. And that, the judge said, was dodging taxes.

Still, leading tax lawyers, economists and tax executives who digested the decision over the weekend are focusing less on why Long-Term Capital's brainpower chose to skirt the law and more on what the decision means for future cases.

The judge, Janet Bond Arterton of Federal District Court in New Haven, ruled in a civil action that Long-Term Capital, the huge hedge fund that collapsed in 1998, acted in bad faith for the two years before its meltdown, when it took $106 million in tax deductions to avoid paying $40 million in taxes.

The decision, which follows a yearlong trial, is thought to be the most significant test case yet of how the Internal Revenue Service will combat sophisticated tax avoidance schemes. The I.R.S. moves on to a civil action against Black & Decker, scheduled to go to trial this fall, according to a senior lawyer in Washington. Black & Decker has sued the government, claiming it is owed a refund of $57 million plus interest on taxes it already paid. The government claims the company engaged in an abusive tax shelter from 1995 to 2000 and owes more taxes plus penalties.

Timothy J. McCormally, executive director for the Tax Executives Institute in Washington, said in an e-mail message yesterday that the Long-Term Capital decision "cannot help but give taxpayers and their advisers pause by underscoring the potency of the tools the I.R.S. has (and has had all along) to attack suspect transactions."

more...

[UpInArms]

3. Former CFO of Golf Apparel Sentenced

http://www.forbes.com/work/feeds/ap/2004/08/29/ap1522387.html

A former chief financial officer at the golf apparel company Cutter & Buck has been sentenced to three months in prison for covering up a multimillion-dollar accounting fraud.

Stephen Lowber, 53, said in court on Friday that his inability to blow the whistle damaged his career, his standing in his church and his family name.

"I profoundly regret the failures I had at Cutter & Buck. I know people were hurt, the investing public was hurt," he said.

<snip>

Cutter & Buck, based in Seattle, shipped goods worth $5.7 million to three distributors in April 2000. The company added $5.7 million to revenue even though the merchandise was essentially warehoused, rather than sold.

Lowber, who resigned in August 2002, pleaded guilty to being an accessory after the fact to wire fraud, admitting he took steps to hide the information from the board and outside auditors when he learned of the scheme.

...more...

[UpInArms]

4. SEC gives a slap on the wrist

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2004/08/29/BUGPF8FL7N1.DTL&type=business

After last week's settlement with San Francisco investment adviser Garrett Van Wagoner, you have to wonder how serious the Securities and Exchange Commission is about protecting mutual fund shareholders.

The SEC alleges that the once-high-flying manager deliberately misled investors and his board of directors about the value of private securities in the three mutual funds that bear his name.

The SEC says that from mid-1999 through 2001, Van Wagoner underpriced the securities so he could exceed the limits on illiquid securities set forth in statements to shareholders. As a result, some investors who bought or sold shares during this time may have gotten an unfair price.

<snip>

So let me get this straight: The board is off the hook because it was misled, and the guy who allegedly did the misleading is partially off the hook because he wasn't responsible for the things he wasn't forthcoming about?

...more...

[UpInArms]

5. Sinopec Profit Jumps on China Oil Demand

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6097947

HONG KONG (Reuters) - Asia's top oil refiner, state-run Sinopec Corp., said on Monday its second-quarter net profit almost doubled as China's fast-growing economy consumed more fuel and crude oil prices climbed.

Some financial analysts expect the Chinese company's refining margins to come under pressure in the second half as the government's recent hike in retail prices for gasoline and diesel was not enough to offset soaring oil prices.

But demand for oil products is expected to remain strong as China's widespread electricity shortages force factories and other users to switch to diesel-fired backup generators.

<snip>

"The company expects global demand for crude oil will continue to grow in the second half ... with crude oil prices fluctuating at a relatively high level."

Sinopec's second-quarter profit surged more than 90 percent to 8.14 billion yuan (US$983 million) for the three months to end-June from 4.28 billion yuan a year earlier, based on Reuters calculations.

...more...

[UpInArms]

16. Shell, Sinopec in China Retail Venture

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6101909

SINGAPORE (Reuters) - Royal Dutch/Shell Group (RD.AS: Quote, Profile, Research) (SHEL.L: Quote, Profile, Research) said it would jointly operate 180 gas stations in China by the end of 2004, the second foreign oil major after BP to enter the country's huge but tightly controlled retail market.

Shell's joint-venture with state refiner Sinopec Corp (0386.HK: Quote, Profile, Research) (SNP.N: Quote, Profile, Research) , would eventually run 500 retail outlets in eastern Jiangsu province, with total investments of $187 million, the companies said in a statement received by Reuters on Monday.

"We believe that this venture will lay an important foundation for our oil products retail business in the world's fastest growing economy," said Rob Routs, group managing director of the Royal Dutch/Shell Group of Companies.

...more...

[UpInArms]

7. All Business: Corporate pension crisis still looming

http://www.naplesnews.com/npdn/business/article/0,2071,NPDN_14901_3140876,00.html

NEW YORK — The corporate pension crisis seems to be going from bad to worse. First, companies struggled to come up with the money to cover their benefit obligations, and now they want to ditch their plans altogether.

The latest twist in this mess comes from UAL Corp.'s United Airlines. It wants to terminate its employee pension funds in order to secure the loans it needs to get out of bankruptcy — a drastic move that would represent the largest pension default ever by a U.S. company.

Should that happen, competing airlines may try to do the same, and it could easily extend to other industries, too. And who would be left with the cleanup? Taxpayers, of course.

"I'm deeply concerned that more and more employers may decide that the rational thing to do ... is to follow others to the exit and get out of sponsoring a pension plan before it becomes an impossible burden," said James A. Klein, president of the American Benefits Council, a Washington-based trade group representing the employee benefits system.

A pension plan is considered underfunded when its obligations — what it owes to retirees — exceed its assets by at least 10 percent. At that point, companies must cover the difference.

...more...

This sounds very similar to what Meanspin wants to do to Social Security.

[UpInArms]

8. Today's Reports:

Aug 30 8:30 AM
Personal Income Jul
report -
briefing.com anticipates 0.5%
market anticipates 0.5%
last report 0.2%
revised -

Aug 30 8:30 AM
Personal Spending Jul
report -
briefing.com anticipates 0.7%
market anticipates 0.7%
last report -0.7%
revised -



8:30am 08/30/04 U.S. JULY PERSONAL INCOME UP 0.1% VS. 0.4% EXPECTED

8:30am 08/30/04 U.S. JULY CONSUMER SPENDING UP 0.8% AS EXPECTED

8:30am 08/30/04 U.S. JULY INCOME GROWTH SLOWEST IN 2 YEARS

8:30am 08/30/04 U.S. JULY PCE PRICE INDEX UNCHANGED; CORE PCE FLAT

8:30am 08/30/04 U.S. CORE PCE PRICE INDEX UP 1.5% Y-O-Y

8:30am 08/30/04 U.S. JULY PERSONAL SAVINGS RATE FALLS TO 0.6%

http://cbs.marketwatch.com/news/story.asp?guid=%7B130F4AE7%2DA420%2D411D%2D93E3%2D985C6D9F4F72%7D&siteid=mktw

U.S. income growth slows in July
Inflation is flat, consumer spending rises 0.8 percent

WASHINGTON (CBS.MW) - Personal incomes of U.S. residents grew 0.1 percent in July, the slowest growth in two years, the Commerce Department estimated Monday.

Consumer spending increased 0.8 percent in July after a 0.2 percent decline in June. With spending rising faster than incomes, the personal savings rate fell from 1.3 percent to 0.6 percent, the lowest since December 2002.

Disposable incomes (after taxes) increased 0.1 percent.

Income growth was a disappointment, but the spending numbers came in as expected. Economists surveyed by CBS MarketWatch were expecting incomes to rise 0.4 percent in July

Inflation moderated in July. The personal consumption expenditure price index was unchanged. The core PCE index - which excludes food and energy prices - was also unchanged.

...more...

http://cbs.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38229.3547685185-819118264&siteID=mktw&scid=0&doctype=806&property=&value=&categories=&

U.S. July personal incomes up 0.1%

WASHINGTON (CBS.MW) - Personal incomes of U.S. residents grew 0.1 percent in July, the slowest growth in two years, the Commerce Department estimated Monday. Consumer spending increased 0.8 percent in July after a 0.2 percent decline in June. With spending rising faster than incomes, the personal savings rate fell from 1.3 percent to 0.6 percent, the lowest since December 2002. Disposable incomes (after taxes) increased 0.1 percent. The personal consumption expenditure price index was unchanged. The core PCE index - which excludes food and energy prices - was also unchanged. Real disposable income grew 0.1 percent. Real disposable incomes increased just 0.9 percent in the first seven months of the year.

[bain_sidhe]

29. How much of that consumer spending increase is due to inflation?

Or is the number inflation-adjusted. And if it IS inflation adjusted, which inflation number is used? The one that leaves out food and fuel, or... er, another one?

Sorry to be so uninformed, but seeing spending up by .8% while incomes are only up by .1% looks so out of whack to me. Can't figure it, unless the increase in spending comes from paying higher prices for the same things, rather than buying more things.

Or, it could be people are just stupid, going deeper into debt, I guess. :shrug: (I say this as somebody who just yesterday paid off our entire credit card balance with savings, and resolved to hide the credit cards till we have a positive cash flow (INCLUDING replacing the savings I just used over the next three months) again.

[UpInArms]

11. pre-opening blather

briefing.com

9:07AM: S&P futures vs fair value: -2.9. Nasdaq futures vs fair value: -8.0. Still looks like a moderately lower open for the cash market... Look for the tech sector to underperform - judging by the pre-market action.

8:53AM: S&P futures vs fair value: - 2.9. Nasdaq futures vs fair value: -9.0. A negative bias continues to prevail in the pre-market, which should translate into a lower start this morning... Losses seen in overseas trading, uninspiring economic data, and a sense of apathy - given that trading activity should be light considering last week's anemic totals and next week's Labor Day - have undercut the market.

8:32AM: S&P futures vs fair value: -2.8. Nasdaq futures vs fair value: -8.5. Futures trade basically unchanged following the mixed July Personal Income and Spending data... Concerns about the rise in oil prices and worries about potential terrorist activity at the Republican National Convention have got buyers on the sidelines.

8:01AM: S&P futures vs fair value: -2.9. Nasdaq futures vs fair value: -8.0. Cash market poised to start the day on a weaker note as traders take light profits from the two weeks of gains... The same can be seen in most international indices, where Tokyo's Nikkei and Germany's DAX have dropped modestly.

ino.com

The September NASDAQ 100 was higher overnight as it extends last Friday's breakout above the 20-day moving average crossing at 1356.80. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If September extends this week's rebound, a test of the 38% retracement level of the July- August decline crossing at 1388.75 is possible later this month. The September NASDAQ 100 was up 4.00 pt. at 1371.50 as of 6:30 AM ET. Overnight action sets the stage for a steady to firmer opening by the NASDAQ composite index later this morning.

The September S&P 500 index was slightly higher overnight as it extends last week's rally and is breaking out above the 40-day moving average crossing at 1098.71. If September extends last week's rally, the 50% retracement level of the June-August decline crossing at 1103.05 is the next upside target. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. The September S&P 500 Index was up 1.60 pts. at 1100.30 as of 6:32 AM ET. Overnight action sets the stage for a steady to firmer opening when the day session begins later this morning.

[UpInArms]

15. 9:48 EST markets are open with some blather

Dow 10,186.68 -8.33 (-0.08%)
Nasdaq 1,853.12 -8.97 (-0.48%)
S&P 500 1,105.72 -2.05 (-0.19%)
10-Yr Bond 4.213% -0.014

9:40AM: Sellers step in in the opening minutes, sending the major indices moderately below the unchanged mark... Tech is the hardest hit in the initial action - due mostly to the fact it rallied the most in the past two weeks... The broader market has moved higher by an impressive margin over that period as bargain-hunters have jumped in at the lows of the year... Now up much higher, buyers have backed off... Fears about possible terrorist attacks during the Republican National Convention and a mixed set of economic data (in the form of July Personal Income and Spending) have also kept buying in check...

[UpInArms]

17. Tyson Cuts Fiscal 2004 Earnings Forecast

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6102931

CHICAGO (Reuters) - Tyson Foods Inc. (TSN.N: Quote, Profile, Research) on Monday cut its fiscal 2004 earnings forecast because of weaker-than-expected demand for chicken and beef and unexpectedly steep raw material costs.

The largest U.S. meat company said it now expects earnings for the year ended Oct. 2, 2004, to be in the range of $1.08 to $1.15 per share. Stripping out 18 cents in one-time charges, the forecast was $1.26 to $1.33 per share.

Analysts, on average, expected earnings of $1.43 per share, according to Reuters Estimates.

"We presently expect our fourth quarter to be more difficult, primarily due to unfavorable results from grain hedging activity, combined with weaker-than-expected demand in our chicken and beef segments," John Tyson, chairman and chief executive officer, said in a statement.

"Additionally, raw material costs for our prepared foods products did not decline as we expected," he said.

...a bit more...

[UpInArms]

18. Attacks all but stop flow of Iraqi oil

http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1093860426335&call_pageid=968332188492&col=968705899037

BAGHDAD - Oil exports from southern Iraq have been brought to a complete halt, a senior oil official said today, following a spate of pipeline attacks launched by insurgents trying to undermine the volatile nation's interim government. In Baghdad, military officials and representatives of rebel Shiite cleric Moqtada al-Sadr held talks Sunday aimed at reducing violence in the restive Baghdad slum of Sadr City. Clashes there killed 10 people on Saturday, officials said. Oil flows out of the southern pipelines — which account for 90 per cent of Iraq's exports — ceased late Sunday and were not likely to resume for at least a week, an official from South Oil Co. said on condition of anonymity. "Oil exports from the port of Basra have completely stopped since last night," the official said today.

A halt in southern oil exports costs Iraq about $60 million (U.S.) a day in lost income at current global crude prices, said Walid Khadduri, an oil expert who is chief editor of the Cyprus-based Middle East Economic Survey.

Insurgents have launched repeated attacks on Iraq's oil infrastructure in a bid to undermine the interim government and reconstruction efforts.

The latest strikes against five pipelines linked to the southern Rumeila oil fields immediately shut down the Zubayr 1 pumping station, forcing officials to use reserves from storage tanks to keep exports flowing for several hours. The reserves ran out late Sunday, the South Oil Co. official said.

...more...

[jayfish]

19. Stocks Dip on Energy Prices, Income Report

http://story.news.yahoo.com/news?tmpl=story2&u=/ap/20040830/ap_on_bi_st_ma_re/wall_street

<SNIP>
Consumer spending rose 0.8 percent in July, better than the 0.7 percent growth economists had expected and more than making up for the 0.2 percent drop in June. But despite the increase in spending, Americans' incomes rose by only 0.1 percent in July, far less than the 0.5 percent forecast by economists and down from a 0.2 percent rise in June.


While consumer spending bodes well for short-term economic growth, the anemic rise in incomes cast a pall over longer term prospects, since rising income is key in overcoming inflation in consumer costs.


Rising consumer prices have been exacerbated this summer by high energy costs. Oil prices rose slightly as Iraqi officials said the country's oil output would be halted for a week due to insurgent attacks on the country's pipelines. The October contract for a barrel of light crude was quoted at $43.47, up 29 cents, on the New York Mercantile Exchange.


A number of companies issued profit warnings on Monday. Tyson Foods Inc. dropped $1.56 to $16.17 after the meat producer reduced its 2004 earnings outlook, citing slow demand and problems with the company's grain hedging activities. Earnings before one-time charges will be between $1.26 and $1.33 per share — analysts had forecast $1.45 per
</SNIP>


Jay

[UpInArms]

20. 10:40 EST numbers and blather

Dow 10,173.76 -21.25 (-0.21%)
Nasdaq 1,841.12 -20.97 (-1.13%)
S&P 500 1,103.26 -4.51 (-0.41%)
10-Yr Bond 4.205% -0.022

10:30 ET Stocks remain in the red with little enthusiasm from buyers... Like last week, this week looks to be low on conviction with investors preoccupied with other things - vacation being on the top of the list... Last week set a series of lightest volume days for the year, and this week looks to be no different with Labor Day (next Monday) around the corner... It is thus hard to get any kind of buying/selling drive going - or even attribute much meaning to one when it happens - when most of it can be written off to a technical correction... Action should pick up following the Labor Day weekend and the anniversary of the 9/11 attacks... ..NYSE Adv/Dec 1183/1564. ..NASDAQ Adv/Dec 886/1701.

10:00 ET Indices remain stuck in negative territory with market internals favoring decliners... Tech and biotech remain the largest losers and have positioned the Composite 0.5% lower... The blue chips, however, are faring comparatively better and are benefiting from selective buying in oil service, telecom, and material... This has helped offset modest losses in retail, consumer staple, homebuilding, and drug... The treasury market is conversely slightly higher this morning with the 10-year note up 5 ticks, bringing its yield to 4.21%... Traders have opted for the security of bonds in the wake of higher oil prices and geopolitical concerns... ..BTK -1.5%. ..NYSE Adv/Dec 1065/1447. ..NASDAQ Adv/Dec 813/1547.

[UpInArms]

21. U.S. Dollar May Ease on Concerns Over Employment, Survey Finds

http://www.latimes.com/business/careers/work/la-fi-dollar30aug30,1,7493269.story?coll=la-headlines-business-careers

The dollar may have peaked on concern that the pace of U.S. job creation will fall short of economists' estimates for a third consecutive month, a Bloomberg News survey indicates.

Forty percent of the 74 traders, investors and strategists polled Friday from Tokyo to New York advised buying the euro against the dollar, 38% recommended selling and the rest favored holding it. About 42% said to buy the yen versus the dollar, 36% to sell and 22% to hold.

<snip>

"If this next month's jobs report is weak, there will be a lot of people emphasizing the vulnerability of the U.S. economy, and that will mean the dollar will weaken," said Straszheim, who is based in Santa Monica.

<snip>

"After months of disappointment, we may well see another weak U.S. employment" report, said Tetsu Aikawa, vice president of derivatives and foreign-exchange marketing at UFJ Bank Ltd. in Tokyo, a unit of Japan's fourth-largest bank by assets. "Selling the dollar looks like the way to go."

<snip>

The dollar will probably weaken to about $1.24 should job growth total about 100,000, said Adrian Hughes, a currency strategist in London at HSBC Holdings. "It would have to be above 200,000, I would say, before we see $1.19 again."

...more...

[UpInArms]

22. Bush: Tax cuts helping revive economy

http://news.xinhuanet.com/english/2004-08/30/content_1925375.htm

BEIJING, Aug. 30 (Xinhuanet) -- US President George W. Bush rallied Republican supporters with the third Ohio bus tour this year in a state critical to his re-election, saying tax cuts approved during his tenure are helping to revive the economy.

"We're heading in the right direction," Bush told a crowd of more than 20,000 in Troy, a manufacturing and retail hub located west of the state capital Columbus. The president is campaigning in swing states before heading to New York on Wednesday for the Republican National Convention, according to Monday's China Daily.

<snip>

Ohio has lost 229,600 jobs during Bush's tenure, government data show, and Kerry is using the losses in his effort to defeat Bush. The state unemployment rate is 5.9 per cent, up from 3.9 per cent when Bush took office. The national rate is 5.5 per cent.

...more...

[UpInArms]

23. Census survey: More families squeezed for rent, mortgage

http://seattlepi.nwsource.com/local/aplocal_story.asp?category=6420&slug=WA%20Census%20Surveys

SEATTLE -- The last time census-takers swarmed through Washington state, the year was 1999 and the economy was booming.

Incomes were up, poverty was down and the housing market was on fire.

Two recent Census surveys released Thursday show just how much has changed in the past few years. Income is stagnant, poverty is up, and the housing market - well, that's still on fire.

As a result, renters and homeowners are getting burned. Between 2000 and 2003, the data show, Washington residents became much more likely to spend more than 35 percent of their income on rent or mortgage - and most experts say that's too much.

<snip>

A separate survey the Census Bureau released last week, the Current Population Survey, showed that more Washingtonians are losing health insurance and falling into poverty. Between 2001 and 2003, the survey says about 14.3 percent of Washington residents lacked health insurance and 11.4 percent lived in poverty.

The trend will continue as long as Washington continues to lose family-wage jobs and replace them with low-paid service jobs, said Aiko Schaefer, director of the Statewide Poverty Action Network.

<snip>

Three years ago, Bruce said 37 percent of the people coming to her program needed help because they'd lost their job or had their wages cut. Now it's 57 percent. She's often amazed that people manage to feed and clothe their families when they spend three-quarters of their income on rent or mortgage.

...more...

[54anickel]

24. Bubble at the Fringe

Last article on the page - interesting info on the way down again too.

http://www.prudentbear.com/creditbubblebulletin.asp

snip>

But what is there to take away from this analysis? Well, it would be truly extraordinary (unprecedented?) for the economy to roll-over with such ultra-easy general Credit Availability and robust lending growth. At the same time, the economy is ominously less than impressive considering the extraordinary financial backdrop. Looking at the decline in rates over the past few months and, as well, factoring in the apparent heightened quest for risk assets, I will err on the side of expecting spending to be resilient through year-end (although this is an admittedly tenuous forecast). But how much will continued buoyant expenditures stimulate U.S. investments and hiring?



Data from the ports of Long Beach and Los Angeles do not bode well for U.S. economic prospects (or July’s trade deficit). Inbound containers into the Port of Long Beach jumped to 281,817, surpassing the previous record set in June by more than 21,000 containers. The Port of Los Angeles also set a new record for inbound containers, with July’s 361,584 slightly ahead of May’s record. Total Inbound containers were up 15% from one year ago to 643,401, while total loaded outbound containers were about unchanged at 178,382. Containers leaving the two ports empty surged 24% from July 2003 to 384,279, more than double those leaving loaded. Wow…



I recall reading articles highlighting noteworthy examples of spending extravagance that preceded by only months the respective crises in Mexico, Thailand, Russia, Brazil, and Argentina. But, then again, lavish purchases and ballooning trade deficits are a hallmark of Monetary Disorder. And while profligate spending is not a fresh development here in the U.S., I couldn’t help but to think that almost 400,000 empty cargo containers leaving the Los Angeles and Long Beach ports during July is a signal along the same lines as booming Mercedes sales were in Russia during 1998’s first half.



And I cannot also help but believe that “strong vs. weak U.S. economy” debates have basically become moot. What should be clear at this point is that even huge fiscal stimulus and unprecedented financial excess are incapable of fostering a sound and self-sustaining economic expansion. The paramount issue, today and going forward, is the deeply maladjusted U.S. economy and its increasing unresponsiveness to even enormous yet misdirected financial stimulus. Both the Financial Sphere and Economic Sphere are severely maladjusted. Two years of Fed-orchestrated “reflation” have only added to the U.S. economy’s inflated cost structure and further weighed on global competitiveness. Meanwhile, the Global Credit Bubble (and China and Asian booms, in particular) has worked to strengthen the capabilities (financial and economic) of our determined competitors.



But we should have expected nothing less. Today’s Bubble at the Fringe is but a further manifestation of historic Credit Bubble excesses that have inflated asset prices, bolstered consumption and imports, and inflated the general economy’s cost structure, while having limited impact on sound business investment. And I will stick with the analysis that today’s predicament of Monetary Disorder and Deep Structural Economic Imbalances is on course to precipitate some type of financial crisis. But, appreciating the extraordinary nature of current global financial systems and markets, it is anyone’s guess as to how long market “ebb and flow” can hold tumult at bay. We do know that the U.S. economy and markets require $2 to $3 Trillion of total annual Credit growth. Succinctly, there remain two overarching issues: First, how long can this amount of Credit creation be maintained? Second, what will be the nature of Inflationary Manifestations while the Credit Bubble is sustained?

[54anickel]

25. Oh my, ISP is slow again today. And so many great articles to post

can be found at http://www.prudentbear.com

I'll try to post a few here if my connection improves.

Meanwhile, check out this little nasty from 321gold. Not exactly kind to Dems, but certainly rips on Shrub and points the finger at Greenspin and the Fed again. (Can't believe this guy won't vote at all!)

http://www.321gold.com/editorials/mackenzie/mackenzie083004.html

NASCAR Dads

"In order to make sure jobs stay here in Ohio and America, we're going to make sure countries treat us the way we treat them."
-President George Bush campaigning in Troy, Ohio

Oh my... heaven forbid countries remotely begin to treat us in the same manner in which we've treated them. The prospects in that realm of blowback remain very serious. Granted, the President was referring to Trade Policy and not Foreign Policy. Although peering through the Foreign Policy looking glass, things do not appear any better:

Within Military Order #1, the President granted himself the POWER, in clear violation of international law, to detain indefinitely any Non-US citizen anywhere in the world.

Lovely, no wonder our new buddy Moammar Kadafi announced he would give up his efforts to develop weapons of mass destruction. He was, after all running the largest underground Chemical / Biological facility on the planet. Still no word on what precisely the "Inspectors" have found.

Some would suggest this is the moral equivalent of negotiating with dictators and yet, the majority of planet's inhabitants outside our borders seem to believe it's something altogether grotesque and malignant. 90+ % of those polled around the globe do not care for George Bush and his policies and believe that his audacious remark above is akin to the self declared "God's Cop" in a now borderless world.

This is how our leadership is perceived.

lots more...

[54anickel]

26. Global: Hardly a Global Soft Patch

http://www.morganstanley.com/GEFdata/digests/20040830-mon.html#anchor0

Many of the major economies of the world have suddenly slowed. First came the US and China, but then Japan, Korea, and Germany have followed in short order. In my view, this is not a coincidence but yet another important example of the interrelated perils of an unbalanced US-centric global economy. When the US and China flinch, the rest of the world -- lacking in autonomous domestic demand -- is quick to follow. Barring a spontaneous reacceleration in the world’s two major growth engines, risks are mounting that 2005 could be a surprisingly tough year.

Recent slowdowns in the US and China have been well documented (see my dispatches of 9 August, “ The Mythical Recovery” and 13 August, “Razor’s Edge”). On the back of an unusually anemic 1.6% increase in real personal consumption expenditures in 2Q04, a consumer-led US economy slowed to a downwardly-revised 2.8% annualized growth rate in the spring quarter -- fully 45% below the 5.1% average pace of the preceding four quarters. Without additional policy stimulus and lacking in organic job and wage income growth, there is good reason to believe that the saving-short, overly-indebted American consumer will remain under pressure for some time to come. The impacts of high and volatile energy prices only increase this likelihood, in my view.

In China, industrial output growth decelerated to 15.5% in July -- still rapid by most standards but fully four percentage points slower than peak growth rates of close to 19.5% earlier this year. Foreign trade and bank lending comparisons have also decelerated, although there was a surprising reacceleration of fixed investment in July. As I see it, a soft landing comes when the industrial output comparisons have moderated into the 8-10% range; to date, China has completed only about 40% of this journey. With CPI-based inflation now above the 5% threshold and only partial progress on the cooling front, I remain convinced that the Chinese leadership will stay the course of its recent campaign of policy restraint.

The world economy, in my view, remains very much dominated by developments in the US and China. The American consumer has long been the driver on the demand side of the global equation. US private consumption growth averaged 3.9% in real terms over the 1996 to 2003 period, slightly more than 75% faster than average gains of just 2.2% elsewhere in the developed, or “advanced,” economies of the world. At the margin, the Chinese producer now wields equally impressive influence on the supply side. China’s 40% surge of imports in 2003 accounted for a highly disproportionate share of export growth in externally-driven economies such as Japan, Korea, Taiwan, and Germany. Moreover, China’s rapid growth in industrial production claimed an outsize share of industrial materials consumption, a key factor pushing up global commodity prices and shipping rates. The world has very much become a two-engine growth machine. And with both of those engines now slowing, spillover effects on other economies should not be surprising.

more....

[UpInArms]

27. 12:44 EST numbers and blather

Dow 10,172.89 -22.12 (-0.22%)
Nasdaq 1,844.51 -17.58 (-0.94%)
S&P 500 1,103.67 -4.10 (-0.37%)
10-Yr Bond 4.196% -0.031

12:30PM: The modest push high off the morning lows has run out steam for the time being with those traders in and not on lunch watching a minor uptick in the crude oil futures. The Dow has edged further back off today's recovery high with the weakest links this afternoon led by HPQ -1.6%, HON - 1.5%, CAT -1.4%, GM -1.2%, INTC -1.2%. The A/D lines for both the NYSE and the Nasdaq are negative by roughly a 2 to 1 ratio while Up/Down volume is bearish by a 3 to 1 margin. NYSE Adv/Dec 1278/1795, Nasdaq Adv/Dec 922/1935

12:00PM: Buyers have taken a respite this morning following two weeks of respectable gains... Worries that the Republican National Convention could be a target for terrorist activity and a mixed set of economic data have reinforced the tendency to sell into strength... July Personal Spending did rebound with a 0.8% gain (consensus of 0.7%) but Personal Income declined to 0.1% (consensus of 0.5%) - suggesting that the consumer might be a bit overextended at this point...

Other factors this morning that have kept buyers from heavily participating include the gunfire attack at a US diplomatic car in Saudi Arabia and the sense that most of Wall Street is on vacation with Labor Day around the corner... Bearish breadth figures and light volume totals reflect this sentiment.... Tech, biotech, and brokerage (i.e. areas that did well during mid-August's uptick) have been punished the most and kept the indices in negative territory... Energy, homebuilding, and retail have also performed poorly and contributed to the malaise... As for areas showing relative strength, interest-rate sensitive issues like mortgage and utility have found buying interest off the rally in the bond market...

[54anickel]

28. Singapore aims to become center for Islamic banking

http://www.hindustantimes.com/news/181_974742,00020008.htm

Singapore is launching a drive to become a center for Islamic financial services as part of attempts to strengthen ties with West Asia, former Prime Minister Goh Chok Tong says.

Islamic law forbids the charging of interest. Islamic banking conforms to this guideline, and appeals to Muslims who don't want to deal with Western-style institutions.

Singapore already has a major banking and fund management industry, backed by assiduous government support. The city-state promotes itself as a regional financial center.

"I want to turn Singapore into a center for Islamic financial services too," Goh, who is now the central bank governor, said in a speech late on Friday.

Goh said he wanted to focus on boosting ties with West Asia, which he pursued as Singapore's leader. Under his tenure, Singapore opened free-trade talks with many Arab states. "I want to enlarge our economic space into the Middle East. One way to do this is to build up expertise to manage Arab wealth," Goh said.

[UpInArms]

32. 2:44 EST numbers and blather

Dow 10,159.69 -35.32 (-0.35%)
Nasdaq 1,842.86 -19.23 (-1.03%)
S&P 500 1,102.65 -5.12 (-0.46%)
10-Yr Bond 4.199% -0.028

2:35PM: The sideways drift at modestly lower levels continues with the large cap tech dominated Nasdaq 100 currently holding the largest percentage loss (-0.9%). Buying interest is minimal but the airline, mortgage, and utility segments of the market have been able to hold on to a favorable bias. The Utility Index (UTY +0.3%) did establish a minor new 52-wk high earlier in the day. Since its intraday low in May the UTY has advanced a bit more than 12%. During the same period the Nasdaq Comp has fallen 1.1%. NYSE Adv/ Dec 1405/1779, Nasdaq Adv/Dec 1010/1965

2:00PM: Very low volume consolidation continues with little of importance on the news front on an individual stock basis other than the early profit warnings from Accredo Health (ACDO - 24%) and Tyson Foods (TSN -7.7%). Despite the weaker tone and negative internals, we are seeing New Highs at the NYSE top New Lows 64 to 10. Stock pushing to new 52-wk highs today have been noted in the brokerage/financial (BAC, BBT, BLK, CBSS, HIB, NARA, SOTR, WTFC) and retail (CC) sectors along with recent IPOs (DPZ, WLK).NYSE Adv/Dec 1393/1770, Nasdaq Adv/Dec 991/1948

1:30PM: No real change to the overall market posture as modestly negative trade amid limited volume continues to dominate. However, the Dow, which has the smallest percentage loss of the major averages, has recently established a minor new session low. The underperforming Nasdaq Comp has remained within an exciting 2.3 point range for the last two hours. On the volume front both the Nasdaq and the NYSE are running at roughly the same pace as Friday which marked the lowest volume of the year. NYSE Adv/Dec 1388/1738, Nasdaq Adv/Dec 989/1937

[trogdor]

35. I nailed it!

Within about 5 pts. I predicted the DOW wouldn't go higher than 10,200 before going back south. Hold on tight, folks; we're headed for something in the mid-9000's

This graph (if you can see it) suggests a bottom range of around 9700, perhaps as low as 9600, before rising again to around 10,050 or so.

http://money.excite.com/servlet/GifServlet?index=5|50|11671|

[UpInArms]

37. so sad :(

Unable to get gif.
got null

love to see graphs :D

[trogdor]

45. copy/paste the entire URL into your browser.

It's a six-month graph of the Dow 30. It shows that for the past four months, the index has hit a peak followed by a valley on a fairly regular interval. You can draw a line across the peaks and valleys and come up with fairly consistent trend lines. The last peak was 5 points was at 10,195 (I predicted 10,200 based on the last three cycles), and I'm predicting the next valley to bottom out at around 9650, at which time I'll probably buy back the $20K worth of American Century Ultra I sold last time - at a neat $600 profit.

[UpInArms]

33. Milwaukee Electric Tool, other units to be sold for $626.6M (Hong Kong Co)

http://www.bizjournals.com/milwaukee/stories/2004/08/30/daily2.html?jst=b_ln_hl

Atlas Copco Group has agreed to sell its electric tools business, including Brookfield-based Milwaukee Electric Tool Corp., to Techtronic Industries Co. Ltd., the Hong Kong-based manufacturer of Ryobi power tools and Dirt Devil appliances, for $626.6 million.

The transaction, subject to regulatory approvals, is expected to close by the end of the year.

The deal includes Milwaukee Electric Tool, producer of the Milwaukee- brand power tools and the Sawzall reciprocating saw, and Atlas Copco Electric Tools GmbH. Atlas Copco Electric Tools is comprised of AEG Electric Tools, a Winnenden, Germany, manufacturer Atlas acquired in 1991, and DreBo Werkzeugfabrik GmbH, a manufacturer of masonry drilling tools in Altshausen, Germany, acquired in April 2003.

The units had 2003 sales of $700 million and about 3,100 employees, with about 2,000 employed by Milwaukee Electric Tool.

...more...

[htuttle]

43. Will the last skilled worker employed in Milwaukee...

...please turn out the lights on the Allen Bradley clock when they leave?

[UpInArms]

34. Pensions alert in US

http://www.business-standard.com/common/storypage.php?hpFlag=Y&chklogin=N&autono=165682&leftnm=lmnu2&lselect=0&leftindx=2

Crisis may burden federal government with a $13-15 billion charge.

The federal insurer behind 31,000 US pension plans has warned of “multi- faceted and profound challenges”, amid clear signs that concern about retirement costs is moving rapidly up the agenda in Washington.

With the threat of bankruptcies looming in the airline industry, senior White House officials are keeping a close eye on developments. The National Economic Council, headed by Stephen Friedman, is working with the Treasury, where a pensions task force is said to have been created. President George W Bush is also understood to have raised the issue with Andrew Card, his chief of staff.

According to one senior administration official, the potential crisis could affect 40,000 people in the airline industry alone and lumber the federal government with a $13 billion-$15 billion charge.

A prime concern is how to save the Pension Benefit Guaranty Corporation (PBGC), the federal insurer, in the event that United Airlines, the bankrupt carrier, terminates its pensions plans.

Last Wednesday, the IAM machinists union met, at the White House, Charles Blahous, special assistant to the president for economic policy, and Bradford Campbell and John Worth, two Treasury officials. Robert Roach, vice- president of the IAM, told the Financial Times: “The White House is very concerned and are looking at legislative solutions. This is being discussed at the cabinet level in the administration.”

The airline sector’s plight is raising broader questions about the sustainability of defined-benefit pension plans, particularly in industries such as textiles, steel and manufacturing burdened with large “legacy” costs.

That, in turn, has prompted fears that the US taxpayer may eventually be required to pick up the bill for companies’ abandoned commitment.

...more...

[UpInArms]

36. 3:11 numbers and blather (sliding toward the close)

Dow 10,142.59 -52.42 (-0.51%)
Nasdaq 1,839.39 -22.70 (-1.22%)
S&P 500 1,100.51 -7.26 (-0.66%)
10-Yr Bond 4.190% -0.037

3:00 ET Minor new session lows for the S&P 500 and the Dow have been noted in recent trade. The Nasdaq Comp finally broke out of its 2.3 point range of the last three hours but has yet to challenge its morning trough. Sectors also pushing to fresh lows this afternoon include: cyclical, housing, semi, networking, Internet, Software, and Computer-Hardware. Despite the fact that we finally have at least some movement, the slow trading activity has not changed with both the NYSE and the Nasdaq now below Friday's pace. ..NYSE Adv/Dec 1384/1820. ..NASDAQ Adv/Dec 942/2050.

[54anickel]

38. Never mind gold's price, look at volume

My connection finally seems to have stabilized for now. But now, it's a mad rush to get some research printed up for class tonight!

http://custom.marketwatch.com/custom/earthlink-net/mw-news.asp?guid={D347F5DB-50E2-487B-8131-45FDE3802A2F}

NEW YORK (CBS.MW) -- Gold is back above $400 (again). Last week, it seemed to stall (again). But look below the surface.

Peering closely, I see three factors at work:

snip>

The surge in open interest tells us good and bad news. Good: huge buyers have appeared. Bad: so has a huge seller(s).

Who are the buyers? The most popular theory among gold bears: a big mining house trying to eliminate a hedge position.

I think this is unlikely. No one producer is big enough.

My guess: Some U.S. hedge funds are buying gold because they think the geopolitical/economic is unstable. So are large operators from elsewhere, partly responding to the same anti-American sentiment which that is driving the retail Middle Eastern markets.

Next question: Who is the seller? After all, someone has to have taken the other side of the trades.

To me, it has to have been a central bank. There is simply no other long (or short) around with this kind of size, or courage.

more...

[54anickel]

39. Which Way the Volumes

http://www.goldenbar.com/Briefs/27Aug04EditorialPF.htm

The gravity theory applied to stocks: if there is no volume, they tend to fall (Bruce Stratton)
I’ll buy that, with caveats; like in the short run they can drift upward too.

However, it’s obviously true that in a bull market volumes invariably must return to the upside by definition. In contrast, in a bear they don’t have to return at all, theoretically, except as a hook – when some longs want off for instance. In some isolated cases I have seen stocks fall by up to half before a material bid showed up to allow anyone with a sizeable position out. But it is rare.

For the most part, bear markets produce high volume selling panics and climaxes regularly depicting a circumstance where everyone is trying to get out at the same time, through a crevasse. Still, that doesn’t refute the gravity theory, or what it means.

It only proves that there is indeed a price for everything, or more accurately, a price at which exchange is always mutually beneficial; where sellers find buyers or vice versa, buying and selling for different reasons – short term, long term, their outlook for earnings, interest rates, politics, or whatever. If that were not true then selling panics would probably be volume-less, all the way to zero. The lack of volume says nothing about the main trend; the way prices behave relative to it is more revealing – as to which way the volumes are likely to manifest when they arrive for instance.

Volumes have been declining on the NYSE all year long, this week marking their lowest yet. Monday represented the lowest regular session volume of trading in almost a year.

Nobody knows quite what it means, but they are quick to write it off as summer doldrums. However, we think it is reminiscent of something more, like perhaps an extended summer past the election, or an imminent reversal.


more...

[54anickel]

40. WrapUp by Tim W. Wood 08.27.2004

http://www.financialsense.com/Market/daily/friday.htm

snip>

Since this writing the bullish forces have proven to be greater than the bearish forces in the dollar, at least so far anyway. In doing so the cyclical set up has slowly but steadily continued to develop positively. The first hurdle that I talked about above has now been cleared. As you can see in the chart below, the August short term cycle low occurred above the July low. This now gives us cyclical evidence or confirmation that the July low was indeed the intermediate term cycle low just as I indicated in the July 30th wrap up.

This leaves the dollar with one more obstacle or hurdle in its path. IF this final hurdle is cleared the dollar should then have clear sailing into its next intermediate term cycle high. But for now the next challenge for the dollar is dead ahead. Cyclically, this challenge is no longer the June short term cycle top but rather the July short term cycle top. The July top occurred at 90.49. The June top occurred at 90.56. Make no mistake about the current setup. The dollar is now clearly poised to challenge these levels and current evidence supports a break out above these levels. Technically, a move above the most recent low at 90.49 would do it, but certainly a move above the June top would set the dollar up for clear sailing into the next intermediate term cycle top.

snip>

A quick look at oil. Below is a chart of the Oil Services Index. I have discussed the fact that the Oil Services Index had not been confirming the latest surge in oil and that this non-confirmation was a warning for oil unless it was corrected. The correction never came and this non-confirmation has now indeed proven to have been a valid warning and that this index was looking ahead for the top in oil. The question now is, do we have THE top in oil or is this just an intermediate term top? It is a little too early to make this call just yet. I do know that the intermediate term cycle in oil has topped and we are now moving down into the intermediate term cycle low. Once this intermediate term cycle low is established, it is the advance out of that low that will tell the tale. But for now, the intermediate term cycle is moving down and until it bottoms the focus should be on its decline.

Let's now turn our attention to the Oil Services Index chart. Notice that the failed rally out of the July short term cycle low was indeed followed by a break below the July short term cycle low. This lead to the recent decline into the August 17, 2004 low. From there this index has rallied. But at present this does appear to be a counter trend bounce. If so, this rally should soon find its top. Once this top is established the Oil Services Index should continue lower into the next short term cycle low, and as of this writing the evidence suggests that this should take this index below the August 17th low.

[54anickel]

41. Hey UIA, did you catch this post I put in LBN on the march yesterday?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x787469


This is just a blatant plug for what I thought was a really up lifting article from Asia Times.

I know, total abuse of the SMW thread. I apologize. There's a bit in there related to SMW though. An interview with a bank audit manager. :evilgrin:

[54anickel]

42. HA HA!!!! Just got a recorded phone call from the Shrub himself!!!

They seem to be calling folks to remind them to send in their absentee ballot request forms. Along with pointing out how great the economy and war on terror are going.

I had another message over the weekend offering me free tickets to go and see the Shrub on 9/03. Just gotta stop by and pick 'em up.

How on earth did I get on their list? I think I originally registered as an Independent years ago. Haven't had to do anything special to register to vote in years. :shrug:

[54anickel]

44. Closin' time

Dow 10,122.52 -72.49 (-0.71%)
Nasdaq 1,836.49 -25.60 (-1.37%)
S&P 500 1,099.15 -8.62 (-0.78%)
10-Yr Bond 4.188% -0.039

NYSE Volume 848,408,000 (OMG!!!!)
Nasdaq Volume 1,004,828,000

Close: The stock market opened the week on the defensive and while the slide was broad based in nature it was far from a selling spree as volume rolled in at its lowest level of the year at the Nasdaq. NYSE volume was just slightly ahead of Friday's total which was the slowest this year. With little on the docket other than a few warnings (ACDO -20.6%, TSN -8.2%), and a mixed economic picture (Personal Income +0.1% -lowest since Nov 20- vs consensus of +0.5% and Personal Spending +0.8% vs consensus of +0.7%) in the wake of the recent two week sprint, traders that were at their desks had little incentive to step in on the buy side. Crude oil trended higher in the morning following attacks by insurgents on Iraq's southern oil pipelines. This strength was not maintained but had little impact on equities. The Treasury market found a bit of a bid amid some month-end and safe-haven interest but here too the action was limited. The weakest sectors today included: biotech, semi, broker/dealer, Internet, computer-hardware, and software. Little was in the plus column other than utility, airline, mortgage and household products. DOT -1.6%, SOX -2.2%, NYSE Adv/Dec 1277/1991, Nasdaq Adv/Dec 977/2092

3:30PM : The Dow and S&P 500 are hovering just above their session lows established this afternoon amid continued light trade. The Nasdaq Comp has been able to remain above its low set this morning despite the pressure in the semi sector (SOX -2%). Mild strength was noted in the Treasury market amid some month-end and safe-haven interest but here too activity was limited in scope. Volume is expected to remain light throughout the week but here are a events that may trigger some interest tomorrow: Consumer Confidence and Chicago PMI are released at 10:00 ET; reporting earnings before the open are ABS, EASI, FCEL, UNFI, ZLC; reporting after the close are COO, DCI, HAIN and OTEX . NYSE Adv/Dec 1310/1916, Nasdaq Adv/Dec 942/2085

3:00PM : Minor new session lows for the S&P 500 and the Dow have been noted in recent trade. The Nasdaq Comp finally broke out of its 2.3 point range of the last three hours but has yet to challenge its morning trough. Sectors also pushing to fresh lows this afternoon include: cyclical, housing, semi, networking, Internet, Software, and Computer-Hardware. Despite the fact that we finally have at least some movement, the slow trading activity has not changed with both the NYSE and the Nasdaq now below Friday's pace. NYSE Adv/Dec 1384/1820, Nasdaq Adv/Dec 942/2050

2:35PM : The sideways drift at modestly lower levels continues with the large cap tech dominated Nasdaq 100 currently holding the largest percentage loss (-0.9%). Buying interest is minimal but the airline, mortgage, and utility segments of the market have been able to hold on to a favorable bias. The Utility Index (UTY +0.3%) did establish a minor new 52-wk high earlier in the day. Since its intraday low in May the UTY has advanced a bit more than 12%. During the same period the Nasdaq Comp has fallen 1.1%. NYSE Adv/Dec 1405/1779, Nasdaq Adv/Dec 1010/1965

2:00PM : Very low volume consolidation continues with little of importance on the news front on an individual stock basis other than the early profit warnings from Accredo Health (ACDO -24%) and Tyson Foods (TSN -7.7%). Despite the weaker tone and negative internals, we are seeing New Highs at the NYSE top New Lows 64 to 10. Stock pushing to new 52-wk highs today have been noted in the brokerage/financial (BAC, BBT, BLK, CBSS, HIB, NARA, SOTR, WTFC) and retail (CC) sectors along with recent IPOs (DPZ, WLK).NYSE Adv/Dec 1393/1770, Nasdaq Adv/Dec 991/1948