STOCK MARKET WATCH, Thursday April 19

[ozymandius]

Source: DU

Thursday April 19, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 641 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2300 DAYS
WHERE'S OSAMA BIN-LADEN? 2010 DAYS
DAYS SINCE ENRON COLLAPSE = 1970
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 9
Enron execs conveniently deceased = 3
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 WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON April 18, 2007

Dow... 12,803.84 +30.80 (+0.24%)
Nasdaq... 2,510.50 -6.45 (-0.26%)
S&P 500... 1,472.50 +1.02 (+0.07%)
Gold future... 693.30 +0.80 (+0.12%)
30-Year Bond 4.82% -0.03 (-0.58%)
10-Yr Bond... 4.65% -0.03 (-0.73%)






GOLD, EURO, YEN, Loonie and Silver

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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 [email protected]

For information on protests and other actions Citizens For Legitimate Government

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Read more: DU

[ozymandius]

1. Today's Market WrapUp

Market WrapUp for Wednesday, April 18
by Chris Puplava

Who's Carrying the Economic Baton?
Part I – The Corporate Sector?

With GDP slowing and housing working through a recession, who is carrying the economy? Is it the corporate sector as many have forecasted, taking the baton from the consumer with pundits touting that corporate balance sheets are strong? Or is the U.S. consumer going to continue its addiction for debt and continue consuming? This week I’ll focus on the corporate sector and have a look at the consumer next week. Let’s have a look at what economic reports are presently saying below on the corporate front.

The Corporate Sector

Analysts are right to point out the health in the corporate sector as quarterly profits have consistently come in with double-digit gains on a year-over-year (YOY) basis for years now.

-see chart-

However, what is also clear is that the trend in corporate profits is slowing, with Q4 2006 profits down 0.3% from Q3 2006, though the YOY rate came in at a very respectable 18.3%, though down from the 30.56% rate seen in Q3 2006. The argument many financial and economic pundits are making is that with pristine balance sheets, corporations will pick up the slack in the economy from a weakening consumer. In essence, corporations will continue to spend and take on more leverage by expanding their businesses. Is this happening? Yes and no.

Corporations are taking advantage of their pristine balance sheets and the low interest rate environment by taking on more debt as corporate debt growth reaccelerated after what appeared to be a peak earlier last year. Corporate debt growth came in at 6.5% Q3 after peaking at 9.6% in Q1 2006, but reaccelerated to 10.9% in Q4 2006. Can corporate debt growth compensate for decelerating household growth to support the economy?

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

[ozymandius]

2. Today's Reports

8:30 AM Initial Claims 04/14
Briefing Forecast 325K
Market Expects 320K
Prior 342K

10:00 AM Leading Indicators Mar
Briefing Forecast 0.2%
Market Expects 0.1%
Prior -0.5%

12:00 PM Philadelphia Fed Apr
Briefing Forecast 2.0
Market Expects 3.0
Prior 0.2

http://biz.yahoo.com/c/e.html

[UpInArms]

18. Initial Claims @ 339,000

03. U.S. 4-wk avg. continuing claims up 9,000 to 2.52 mln
8:30 AM ET, Apr 19, 2007 - 4 minutes ago

04. U.S. continuing jobless claims up 6,000 to 2.53 mln
8:30 AM ET, Apr 19, 2007 - 4 minutes ago

05. U.S. 4-wk avg. initial claims up 5,250 to 328,750
8:30 AM ET, Apr 19, 2007 - 4 minutes ago

06. U.S initial jobless claims fall 4,000 to 339,000
8:30 AM ET, Apr 19, 2007 - 4 minutes ago

[UpInArms]

40. Leading Indicators fall 0.1% in past six months

11. Leading indicators point to slower growth: Conference Board
10:00 AM ET, Apr 19, 2007 - 23 minutes ago

12. U.S. leading indicators fall 0.1% in past six months
10:00 AM ET, Apr 19, 2007 - 23 minutes ago

13. U.S. March leading indicators up 0.1% vs. 0.2% expected
10:00 AM ET, Apr 19, 2007 - 23 minutes ago

[54anickel]

58. U.S. Economy Seen Expanding Modestly

Leading Indicators Rise 0.1 Percent in March, Pointing to Modest Growth

http://biz.yahoo.com/ap/070419/economy.html?.v=3

NEW YORK (AP) -- A barometer of future economic growth rose a tepid 0.1 percent in March, hinting that the U.S. should expect only a meager expansion in the coming months, a private research group said Thursday.

The Conference Board said its index of leading economic indicators climbed an expected 0.1 percent to 137.4 last month. The index is designed to forecast economic activity over the next three to six months.

The latest reading reverses two consecutive months of declines. Despite the latest increase, the index is still below its most recent high of 138 in January 2006.

The reading tracks 10 economic indicators. Six of those readings were positive in March: initial unemployment claims, weekly manufacturing hours, real money supply, vendor performance, building permits, and manufacturers' new orders.

The negative contributors were stock prices, consumer expectations, interest rate spread and manufacturers' new orders.

"It's kind of an encouraging report in the sense that the positive contributors were from the business sector," said Gary Bigg, an economist with Bank of America.

Negative contributors, such consumer expectations, should rebound next month in response to recent gains in the stock market, he said. Still, Bigg said the reading indicated fairly sluggish growth for the remainder of the year.

more...

[ozymandius]

3. Oil prices rise in European trading

VIENNA, Austria - Oil prices rose Thursday on a report showing that U.S. oil refineries were accelerating gasoline production ahead of the summer driving season even as U.S crude and gasoline supplies fell.

The drop in oil stocks was unexpected, and draws on gasoline supplies was greater than forecast.

Light, sweet crude for May delivery rose 5 cents to $63.18 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe. The contract, which expires Friday, had settled 3 cents higher at $63.13 a barrel Wednesday after a rally from earlier losses.

-cut-

The report also showed U.S. gasoline inventories fell by 2.7 million barrels, more than the expected 1.5 million barrel decline.

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

[ozymandius]

5. Oil ebbs on pipeline restart, Iran worries support

LONDON (Reuters) - Benchmark Brent oil edged lower and U.S. crude fell on Thursday after a major Canadian pipeline was restarted, but renewed concern over Iran's nuclear program lent some support to prices.

London Brent crude fell 19 cents to $65.85 a barrel by 0812 GMT, reversing Wednesday's 11-cent gain that pulled prices back from a three-week low of $64.76 a barrel. Benchmark U.S. crude fell 45 cents to $62.68.

Prices retreated after Enbridge Inc. said it had restarted a portion of a pipeline carrying Canadian oil to the U.S. Midwest. It had been shut after a leak on April 15. The line will operate at reduced pressure of 80 percent pending further tests.

http://news.yahoo.com/s/nm/20070419/bs_nm/markets_oil_dc_3

[UpInArms]

4. dollar watch

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

Last trade 81.609 Change 0.001 (-0.00%)

Dollar Stalls In Dangerous Territory

http://www.dailyfx.com/story/currency/eur_news/Dollar_Stalls_In_Dangerous_Territory_1176916438623.html

The fundamental calendar has left the US dollar to drift against the revived currencies of the G10. With only second and third tier indicators filling out the coffers for the rest of the week, greenback bulls will have to position off of unforeseen events or cross currency data to generate momentum – a risky proposition since many of the majors are testing big levels.

For EURUSD, that level is the 1.3670 high put in back in the December of 2004. Spot continued its slow approach of this level, but price action on the quiet day today kept things in a 60-point range below 1.3620. Dollar weakness translated to a new four month low against the Swiss franc, a distinction won when USDCHF dropped quickly below 1.2030. After the big rally Tuesday that pushed GPBUSD above 2.0, bulls looked to push the pair the last few steps beyond 2.01 and in turn make history with a new 26-year high. Finally, even the carry trade, the last bastion of dollar buying, lost its appeal as USDJPY lost another 80 points to bring the two day total to 180 points.

From the economic calendar, the only noteworthy indicator available was the Mortgage Bankers Association’s weekly applications data. According to the group’s numbers, total applications fell 2.5 percent through the period ending April 13th. Including today’s number, mortgage filings have fallen five weeks in a row. The last time, the MBA’s data has shown such a consistent downtrend was in May and June of 2004. Adding to the concern, the less-volatile four-week average for the applications index dropped to 406.1, only slightly above the average for the fourth quarter of 2006. Any way this indicator is cut, it offers little support for the weakened housing sector. And, in compared to the monthly sales and construction gauges that draw so much attention, the weekly applications reports are far more prescient. Not only are the numbers more timely, but the mortgage process is upstream to building and sales. If home loan applications continue to slide due to increased regulations and requirements following the sub-prime upset, then the broad housing sector may revive its declines.

Looking ahead to tomorrow, there are releases that will generate interest on their behalf. The morning will begin with the first-time jobless claims for the last week. Economists expect claims to dip 22,000 to 320,000, though such an improvement wouldn’t fundamentally change payroll numbers. However, after the better than expected print in March NFPs, any bullish employment data would help to build generous speculation for April’s figure. A little later, the Philly Fed factory survey will mark the fundamental highlight of the day. The manufacturing sector has flirted with recessionary readings in the past few months; and any sign of improvement or deterioration could clear the market’s outlook for the nationwide ISM release. What’s more, after the small change in the Empire activity report, a surprise showing in the Philly number could pick up volatility on an otherwise quiet session.

...more...

US Dollar Continues to Weaken, Hitting 20 Yr Lows Against British Pound and New Zealand Dollar

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/US_Dollar_Continues_to_Weaken__1176932580439.html

US Dollar- With no significant data on the US calendar, there is nothing preventing traders from selling US dollars. In fact, the dollar hit fresh 26 year lows against the British pound, 24 year lows against the New Zealand dollar and 2.5 year lows against the Euro before recovering. The recovery however was shallow as the EUR/USD, GBP/USD and NZD/USD all ended up back in positive territory. This is not a reflection of the market’s distaste for the US dollar or their pessimism about the outlook for the US economy. Instead, it is a reflection of the market’s voracious appetite for yield. Currency traders refuse to give up on carry trades and the major intraday reversals in USD/JPY and NZD/JPY are evidence of that. It is probably not a coincidence that the Dow Jones Industrial Average also hit an all-time high today. The weakness in the US dollar is helping to make US stocks a good value for foreign investors. We expect the Treasury’s reports on net foreign purchases of US securities to be strong in the next few months as the demand for both US stocks and bonds remain robust. Looking ahead we are expecting leading indicators, jobless claims and the Philly Fed report. The rise in the stock market should help to boost leading indicators while jobless claims are predicted to have dropped last week after the prior week’s sharp surge. This makes the Philly Fed survey the event risk for the day. Even though the Empire State manufacturing survey rebounded far less than expected, the forecasts for the rebound in the Philly Fed survey is already very modest, which means that it may not be hard for the data to surprise to the upside. The more important question to ask however is whether this will matter. There is no doubt that the US dollar is oversold, but the only turn that will probably see is in USD/JPY and not in the EUR/USD or GBP/USD.

...more...

[ozymandius]

12. Please refresh my memory.

Which country has publicly announced that it is drawing down its dollar reserves?

[UpInArms]

14. ... err... that would be Iran

Iran cuts US dollar reserves

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=50889&NewsKind=Current%20Affairs

Tehran has cut the share of dollars in its foreign reserves to a minimum, about 20%, as it seeks to hold less of the US currency in response to hostility from the United States, Ebrahim Sheibani, the country's central bank chief said, Reuters reported.

Sheibani, speaking to Reuters on a visit to Malaysia, also said Iran's economy can withstand UN sanctions and the country has enough foreign reserves to handle any major shocks.

"In dollars now, it is at a minimum level, maybe around 20% because we need to keep that," Sheibani said in an interview on the sidelines of an Islamic finance conference.

The United Nations imposed new sanctions on Iran on Saturday because of Tehran's refusal to agree to US-led demands to halt its nuclear programme.

The sanctions target Iranian arms exports and 28 Iranian individuals and entities, and there is the threat of wider sanctions if Iran does not comply within 60 days.

Sheibani described the new sanctions as largely symbolic and said they posed little threat to Iran's oil-led economy.

"I do not think that there is any, or there will be any, effect or adverse effect on Iranian economy because the new sanctions are limited to some areas, which are not much related to our economy," he said.

He did not give a total reserves figure but said they stood at a record high. Asked if they were enough to cope with any major shocks, he added: "We can service our debt very well. Our debt-service ratio is very good and so there is no reason for us to worry about that at all."

...more...

but other countries are probably not far behind on dumping the dollar -

The $64,000 question is how long the pound can remain above $2

http://news.independent.co.uk/business/news/article2461480.ece

Book your trip soon, was the advice yesterday to shopaholics planning a break in New York for some serious retail therapy.

Currency analysts said that, while sterling could race to $2.05 in the next few weeks, the exchange rate was likely to slide back below two-to-one by June. They said dwindling fears about rising UK interest rates and growing confidence about the US outlook would soon see the pound back-pedaling against the dollar.

"Sterling will remain well supported going into the Bank of England's next interest rate meeting, but if there's a hint that the expected hike is the last for a while, or that the Monetary Policy Committee's work is done, it will start unwinding," said Paul Mackel, currency strategist at HSBC.

"I don't think investors are trying to build long cable (sterling/dollar) positions - it's quite lofty at these levels. We retain our forecast of $1.97 in three months' time."

...more...

[ozymandius]

17. figures

My frail memory dithered between Iran and Venezuela. Russia also came to mind.

[Ghost Dog]

38. Russia, China, the Gulf States,

even Norway, if I remember right (and there are surely more), are all on record, if I recall aright, as recently saying they are 'to some degree diversifying' out of the dollar.

Since Iran's ability to trade with it's dollar assets is being sanctioned by the USA, their position shouldbe considered rather less voluntary than those of the others.

Iran is also trading oil and gas in Euros, Yen, probably Yuan, whatever reasonable currency is on offer (but still fixes prices, for now, in dollars).

[54anickel]

33. And don't forget.....

RBI may have to diversify currency reserves
http://economictimes.indiatimes.com/News/News_By_Industry/Finance__Insurance/Banking/RBI_may_have_to_diversify_currency_reserves/articleshow/1917651.cms

MUMBAI: A weak dollar may not be a good news for the central bank. For the Reserve Bank of India (RBI), which holds a bulk of its foreign currency assets in US dollars, a weak dollar or a strong rupee also poses an additional challenge in treasury management since the returns are not attractive in a depreciating currency.

With the rupee making one of its fastest gains against the dollar, the returns on reserves could come under pressure, if the central bank continues with its current mix of currency reserves which is known to be very dollar-centric. A senior treasury official with a private sector bank said, “The trend in the currency markets indicates that the dollar is no longer a preferred currency, and it is right time to sell dollars and move to more stronger currencies.”

Major global currencies like the Japanese yen, Sterling pound and the euro have appreciated against the dollar. While, the yen has appreciated 3.3%, the pound and the euro have gained 5% and 4.3%, respectively against the dollar. At the same time, these currencies have also appreciated against the rupee. And therefore, there is a case for the central bank to diversify in these currencies.

more...


HK may buy riskier assets: Morgan Stanley
http://www.chinapost.com.tw/news/archives/business/2007417/107391.htm

The Hong Kong Monetary Authority may invest more of its US$135 billion of foreign-exchange reserves in Asia to increase returns, said Stephen Jen, head of currency research at Morgan Stanley.
The city's de facto central bank, whose reserves are mostly in dollar-denominated debt, may buy riskier Asian assets, which would support the region's currencies, wrote Jen in a research note April 12. Yields on 10-year bonds in India and Indonesia are more than 3 percentage points higher than those of similar- dated U.S. Treasuries.

Hong Kong "could follow the trend in the region and raise its exposure to riskier assets with higher expected returns," wrote Jen, who previously worked at the World Bank, Federal Reserve and the International Monetary Fund, in a report April 12. "This may be the next logical step."

China last month said it would set up an agency to diversify part of its US$1.2 trillion reserves, the world's biggest, that are mostly invested in U.S. Treasuries. HKMA reserves are used to defend Hong Kong's 23-year dollar peg. More than three-quarters of the reserves are invested in debt and the rest in equities, with 88 percent in dollar-denominated assets.

HKMA head Joseph Yam said in January the reserves are not an investment fund and its main aim is liquidity and capital preservation.

more...


Qatar goes on gold-buying spree
QATAR may have bought more gold than any other country this year, seeking to diversify its reserves and hedge against a weakening dollar.
http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=144042&version=1&template_id=57&parent_id=56

The state held gold worth QR240mn ($66mn) at the end of February, from QR44mn at the end of 2006, central bank figures released yesterday showed. That indicates an increase of about 2.4 metric tons, based on average spot gold prices for December and February. The calculation doesn’t take into account price gains in January and February.

That would exceed the 1.3 tons Russia added to its reserves in January, according to data on the website of the London-based World Gold Council, which were last updated on March 12. The only other countries to add to their reserves this year, based on that data, were Greece and Mexico.

“The gold purchases are indicative of concerns that the central bank, like many others in the region, has over the weakness of the US dollar,’’ Simon Williams, an economist with HSBC Holdings, said in an e-mail from Dubai. Some investors buy gold as a store of value when the dollar weakens or when inflation accelerates.

Central banks last year held the smallest amount of gold since 1948, according to the World Gold Council and International Monetary Fund data. European banks in 2004 agreed to cap their sales to 500 tons a year through 2009.

An advisory panel in January said the IMF should sell 400 tons from its reserves and invest the proceeds in interest-bearing assets.... Hmmmm, :freak: that could hold down the price and support the notion of "low inflation".

more...

Then there's the Czech Krown
http://www.fxstreet.com/technical/market-view/daily-forex-outlook/2007-04-18.html
snip>

The Czech Krown saw central bank has reduced US dollar holdings from 47.2% of its foreign exchange reserves at the end of 2005 to 34.6% now. The reduction in the reserves, which amount to $32b, has been mainly in favor of the British pound and Japanese yen.



Let's not forget our own Fed's words from March....

Cleveland Federal Reserve President Sandra Pianalto says inflation not easing as much as expected, dollar benefits from global popularity.
http://money.cnn.com/2007/03/27/news/economy/bc.usa.fed.pianalto.reut/?postversion=2007032707

snip>

Regarding the U.S. dollar, Pianalto also said: "The United States benefits from the fact that the largest share of world currency reserves are held in dollar-denominated assets. Among these benefits is our ability to borrow from the rest of the world at a low interest rate."

Speculation that world central banks may diversify some of their reserves into other currencies such as the euro was one of the factors that contributed to dollar weakness in 2006. Countries including China, Russia, Sweden and Iran have cut dollar allocation in their reserves.

Nonetheless, International Monetary Fund data shows that the dollar's share of reserves where currency allocation is known has been broadly stable at around 65 to 66 percent since late 2004.

But Pianalto added that the market share of any currency was subject to challenge and monetary authorities had a role to play in maintaining this share by keeping inflation low and stable.

"A potential loss of purchasing power can erode the economic benefits associated with using any particular currency for international trade. When viable alternatives exist, individuals and governments will gravitate toward the currency with the most stable purchasing power," she said.

" ... the monetary authority must show that it will remain committed to protecting the purchasing power of its currency. Global competition for international reserve currencies gives central banks an added incentive to pursue that goal."

Borrowing from the rest of the world at low interest rate has helped keep inflation down in the United States, contributing to an economy that has seen companies such as Dell (Charts), Wal-Mart (Charts), IBM (Charts), Morgan Stanley (Charts) and Bank of America (Charts) enjoy profitable decades.

more...


Iran leads attack against U.S. dollar
http://www.globalresearch.ca/index.php?context=viewArticle&code=COR20070412&articleId=5370

While the world press has focused on Iran's plans to move ahead with enriching uranium, Tehran continues to wage economic war against the U.S. dollar behind the scenes.

Tehran has reached a decision to end all oil sales in dollars, according to statements by Iran's central bank governor, Ehrabhim Sheibany, in Kuala Lumpur at the end of last month.

Zhuhai Zhenrong Trading, a Chinese state-run company that buys 240,000 barrels of oil per day from Iran, approximately 10 percent of Iran's 2.2 million barrels per day total output, has confirmed a shift to the euro for its Iranian oil purchases.

About 60 percent of Iran's oil income is currently in non-dollar currencies, according to Hojjatollah Ghanimifard, who is responsible for international affairs for National Iranian Oil.

Even Japanese refiners who buy some 550,000 barrels of oil a day from Iran have indicated their willingness to buy Iran's oil in yen.

China, which buys approximately 12 percent of its crude oil supply from Iran, signed last year a long-term $100 billion deal with Iran to develop Iran's giant Yadvaran oil field. Estimates indicate China could draw 150,000 barrels of oil from the Yadvaran field for the next 25 years, assuring Iran's position as one of the major suppliers of oil to China for decades to come.

One possibility is that China may begin paying Iran for oil in yuans.

Meanwhile, China which now holds $1 trillion in foreign reserve holdings, announced March 20 it will no longer accumulate foreign exchange reserves.

This is more bad news for the dollar, since approximately 70 percent of China's $1 trillion in foreign reserve holdings are held in U.S. dollar assets.

snip>

Iran has yet to open an Iranian oil bourse, but demanding payment for Iranian oil in currencies other than the dollar is seen by many experts as a more direct attack on the dollar, especially if the Iranian decision backs a worldwide move away from using the dollar as the underpinning of world foreign exchange reserves.

more...

[54anickel]

28. No, no, no...we're looking at this all wrong. Worth less dollars are good,

assuming you can get your hands on enough of them to put food in your belly and a roof over your head, that is.

Here's the viewpoint from "the other side". Only fair to give them equal time.


The Dollar's Deceptive Descent
http://www.investors.com/editorial/editorialcontent.asp?secid=1501&status=article&id=261702713421478

Competitiveness: The U.S. dollar has crashed through the $2 level against the British pound — another sign of America's long, sad financial decline. Or so we're told. But, of course, it isn't that at all.

'The last time the British pound was worth more than $2," the Associated Press noted, "the elder George Bush was waging a losing U.S. presidential campaign against Bill Clinton and the Eurotunnel linking Britain to Europe was still under construction." The dollar's near its lows against the euro, too.

But it's deceiving to look at two currencies in isolation and to conclude, based on their relative values, that one's doing poorly while the other's doing well. That's the case with Britain, where the dollar on Tuesday breached the $2 mark for the first time since 1992.

Is the dollar's decline a commentary on the relative dynamism of the two economies, with the British economy now the place for growth, while the U.S. is languishing? Hardly.

As we've noted before, the U.S. economy — despite Fed rate hikes and a bumbling Congress that threatens to let tax cuts expire — seems to be doing just fine. Tuesday's crop of fresh data paint a mixed, if still healthy picture:

snip past the lies and stats>

And, oh yes: the S&P 500 index on Tuesday rejoined the NYSE composite in new-high territory — and the Dow industrial average looks like it's about to also.

Yet for those prone to worry, the weak dollar foreshadows a future recession — or worse. They see the dollar's descent against currencies like the pound, the euro and the yen as a loss in confidence in American economic vitality and a conviction that the U.S. is passe.

It's true that the U.S. has some problems. As mentioned here on Tuesday, for example, we think Sarbanes-Oxley has done significant damage to America's reputation for transparent, easy-to-access capital markets. :spray: And the reason it was enacted in the first place had absolutely no effect on Murika's reputation

Yet, the consensus estimate calls for 2.4% growth in the U.S. this year. That's about in line with the 2.6% average since 2000 — which is faster than the average growth of the U.K. and a full percentage-point faster, on average, than growth in the Eurozone.

It might be true that the U.S. economy is slowing a bit faster than Europe's right now. But clearly, our economy, based on job growth and overall economic performance lies, is the more dynamic.

As we said, it makes little sense to measure one currency against another and call it "weak." Besides, as the chart at left shows, it's actually a misnomer to call the dollar "weak."

Weak against what? We took the Atlanta Federal Reserve's trade-weighted index of the dollar against other currencies. :eyes: Hmmm, haven't we looked at that trade-weighted index before?



more...

[54anickel]

53. Figures Don't Lie, Liars Figure

http://www.agorafinancialpublications.com/RudeAwakening/RAissues/2007/MarApr/RA041807.html

"Information" and "insight" often seem like synonyms. Like, for example, when your neighbor says, "Hey John, I saw your wife kissing the milkman this morning." This particular bit of information contains a wealth of insight.

In other settings, however, "information" and "insight" can feel like antonyms. Like, for example, when a CNBC commentator remarks, "The stock market is acting well." This particular bit of information contains not a single scrap of insight. It is, therefore, "useless information."

A third category of information strays even farther from insight. It produces deception, or "anti-insight." This third category of information is called, "government data." Within this deceptive category we find items like the Consumer Price Index (CPI) and Gross Domestic Product (GDP).

The leaders of our government would prefer that the statistical portrayals of our economic health be as flattering as possible…and so they have become. Over the years - little by little - various government agencies have revised the processes andmethodologies that calculate important economic data like GDP. The government bean-counters continuously revise their processes, they say, to make their data more accurate. But somehow, each new methodology flatters our economy more than the preceding methodology. The new and improved numbers always become…well…new and improved.

A little nip here on the CPI, a little tuck there on the GDP - along with a bit of M-3 removal - and before you know it, you've got an economy that looks pretty darn good, even if its underlying health is suspect.

One man, John Williams, prefers insight to deception - so much so that he has created an entire business around producing truthful government statistics. His business, called "Shadow Government Statistics," exposes and analyzes the flaws in current U.S. government data and reporting, as well as in certain private-sector numbers.

more...

[AnneD]

55. Thanks for the paper...

54anickle. I need to wipe my * and I'm all out of dollars. It would be funny if it weren't true.

[54anickel]

57. Bwahahaha! I can no longer afford my favorite brand. Dollars would be a good substitute...

[AnneD]

61. Bytchin...

I'd pinch a few pennies to use that brand. It probably isn't that strong though, and that yellow stripe down the middle clashes with my decor.

[54anickel]

62. **SNARF**

[AnneD]

34. Morning Marketeers......

:donut: and lurkers. Boy, I have another laundry list of grips today. I really am going to have to completely switch to decaffeinated, or better yet start putting TLC in my coffee (you med types know what TLC I'm talking about). We have all gone stark raving mad.

1) The recent SCOTUS decision. I don't care what side of the debate you fall on, this is the most anti woman decision I have yet to see. Late term abortions are rare to begin with and usually involve a medical problem either with the fetus or health problems with the woman. No one goes through these for shits and giggles. Not at least allowing these procedures for medical reasons amounts to a death sentence or unnecessary pain and suffering for women. And what is the point of caring to term a dead or so severely damaged fetus. Culture of life my ass. Rights my ass. Compassion my ass. Once again, old men are telling young women what they can do and government is sticking their noses in women's vagina's. If men bore children, we wouldn't even be having this discussion.

2) Availability of guns. I grew up with guns. I learned how to handle guns. I am all for having guns for hunting and protecting ones self. I am opposed to assault rifles. They either kill a lot of people or leave too much lead in you game, neither of which are good. I think we can insure our right to bear arms, keep the more dangerous weapons off the street, AND instill a bit of sanity into the debate.

3) The economy. Is it ever a mess. Our leaders have forgotten how to really run a business. In fact I think they want to enrich their pockets instead of earning their money. Our government has forgotten that they are suppose to represent the people's interest, not industry or their lobbyists. They have not followed even the most basic of economic principles. We are reaching a tipping point and we will need leaders that have some backbone. The most succinct way I can put this ...It is only when the tide goes out that you learn who's been swimming naked. Frankly our economy and government have been swimming naked and some folks are in for a shock.


Happy hunting and watch out for the bears.

[54anickel]

35. Have central bankers lost control?

http://www.moneyweek.com/file/28158/have-central-bankers-lost-control.html

Another strong March US payroll report has rattled financial markets. Although investors had expected slowing US economic activity to presage the first base rate cut in that country late in the second quarter of 2007 the report proved sufficiently strong to suggest that the US may not now embark on the process of interest rate reductions until early in the third quarter. Looking at the shape of the US Treasury bond yield curve, the extent of the inversion (3 month Treasuries yielding more than 10 year paper) might indicate, as it has done in the past, that investors were increasingly concerned regarding the possibility of a hard economic landing later this year.

However, the global economy is clearly thriving, equity prices continue to surge as investor confidence reasserts itself in the wake of the “risk episode” at the end of February and M&A activity continues to hit record levels around the world as “hot money” surges from one destination to the next in the same bewildering way in which a drunken sailor might reel from one side of the road to the other. Around the world central bankers have been raising short-term interest rates in concerted fashion but to no avail. What is going on and how might it all end?

Is central bank activity doomed to failure?

snip>

Global imbalances create demand for synthetic products
The massive structural imbalances between the world’s largest trading partners, coupled with a pegged Chinese currency, have created enormous demand for long-dated high grade debt. The US authorities have a problem in meeting this voracious appetite from only limited supply. The US hardly issues sufficient paper to meet the demands of China, let alone Japan or Saudi Arabia or other surplus countries or trading blocs. Enter the financial market alchemists!

The process of securitisation, bundling up high grade and low grade paper attempts to solve the US central banker’s conundrum. By packaging up high grade debt, low grade “junk” bonds, together with home loan mortgages and credit card balances financial market engineers create a legal entity known as Special Purpose Vehicles (SPVs). These vehicles bundle up the bonds and then slice them up again into varying tranches, each with varying claims on the underlying debt’s cash flows. Tranches with first claim are sold to central bankers with riskier tranches off loaded onto hedge funds and other operators prepared to bet that defaults will stay low enough to make their higher yielding portions profitable.

Rubino’s article indicates that the dawn of synthetic securitisation on business has been “nothing less than seismic”. In the past a bank writing a mortgage or business loan might have held it to maturity, it can now be sold on immediately and the proceeds used to create more loans. Banks have thus been turned into the suppliers of raw material to the securitisation industry, illustrating their continued willingness to lend despite the inverted nature of the bond yield curve. Private equity firms can instantly monetise their leveraged buy-outs and mezzanine debt, allowing them to jump straight back into more deals!

Insuring Synthetics
Whilst young and relatively inexperienced investment bankers yearn for the yields on these securitised packages they have had trouble, in the past, in convincing older and more experienced managers to participate in the frenzy. Such risk-averse individuals have needed persuading that these products are for them and the best way of so doing has been to provide such potential decision makers with insurance as a back-up. Enter the Credit Default Swap (CDS)!

A Credit Default Swap is a bi-lateral, privately negotiated, insurance contract through which an underwriter agrees to cover any losses arising on securitised instrument default. Whilst banks used CDS’s to limit default risk on a loan, a huge market has been created in structured finance (providing insurance against default in asset-backed securities). As these insurance-type products have gained widespread acceptance so a market for them has inevitably evolved. Extraordinary as it may seem there is, at present, no regulatory restriction on the number of CDS’s written on any one company’s debt, hence US automotive parts supplier Delphi had, at one stage in 2005, c$25bn insurance on just $2bn debt!

When default rates are as low as they are such instruments gain huge popularity with hedge fund managers looking for new and alternative ways to make money for investors. Finding buyers for such instruments can be a problem but not if accompanied by cheap financing deals to any non-bankrupt company interested in acquiring them. Armed with cheap credit companies and private equity businesses have taken full advantage. According to Rubino S&P 500 companies bought back $431bn of stock over 2006, three times the levels of 2003. It hardly needs us to point out that share buy-backs are popular amongst large companies apparently lacking internal growth opportunities and for small companies eager to pre-empt possible private equity intrusion. As in the 1980s companies seeing themselves as possible bid targets are leveraging up to boost short-term investor returns and head off possible predatory interest but it still didn’t stop global M&A increasing by 38% to $3.79 trillion in 2006!

more...

[UpInArms]

41. hey 54anickel -

are you seeing that lovely yen-tervention trend again?

[54anickel]

43. Like the wind beneath the feather in the Forrest Gump movie?

[54anickel]

44. Trichet Warns of `Dangerous Herding' Derivatives Risk (Update4)

http://www.bloomberg.com/apps/news?pid=20601087&sid=axlZou1akI2Y&refer=worldwide

April 18 (Bloomberg) -- Credit derivatives may create risks to the financial markets if events prompt investors to exit at the same time, said European Central Bank President Jean-Claude Trichet.

Investors ``may react in a way that can suddenly lead to dangerous herding behavior,'' said Trichet, who was speaking in Boston at the annual meeting of the International Swaps and Derivatives Association, which represents 750 banks and securities firms. ``Such situations are also a matter of concern from a systemic liquidity viewpoint.''

Credit derivatives are the fastest growing financial market, surpassing bonds and loans as a cheaper way to speculate on credit quality. The market has doubled in size every year since 2003, with outstanding contracts covering $34.5 trillion of securities, ISDA said today.

The decade-old market hasn't been ``stress tested'' in a crisis, Trichet said. There is potential for ``counterparty risk'' if investors to seek to exit at the same time, he said.

Potential herd-like behavior could reduce market liquidity and affect the ability of a ``significant'' market participant to finance its business, Trichet said. Such problems are low- probability events, Trichet added. The consensus view is that derivatives help efficient risk management.

If liquidity were to fall, ``potential loss to the financial system'' would be ``great,'' Trichet told delegates at ISDA's conference. ``The fear is that a large proportion of market participants may have become excessively complacent.''

Untested Market

more...

[kineneb]

46. dangerous herding behavior="lemmings"?

this whole mess seems too reminiscent of 1929 and all the margin buying...
speculating on speculation?

What happens when the house of cards collapses?

[54anickel]

54. Sheep to the shearing barn....

[54anickel]

52. The Dow Is Crashing! A Story in Pictures by Mike Maloney

http://goldsilver.com/the_dow_is_crashing.php

On October 4th 2006, the Dow broke its old high of 11,750 set back on January 14th 2000, and from then on all you heard from the financial press was "Dow sets a new, all time, record high"… at least that's all you heard until the correction on February 27th, 2007.

I just don't get it. How can anyone at this point in time (including the financial press) believe they are actually making gains being invested in general equities? On February 20th, the Dow hit its "brand new, all time, record high" of 12,795, and at the writing of this article hovers at 12,560, 6.9% above its 2000 high.

A 6.9% gain over the entire 7-year period… hasn't anyone heard of inflation? Don't investors know that if their portfolio doesn't outpace inflation they are actually losing ground?

The Dow is actually crashing, but if you have not yet educated yourself on the insidious ravages that inflation can have on your portfolio, you can't see it. This is a blind spot investors must be mindful of, and guard against, if they are to prosper.

Anytime that it looks like everything is going up, stocks, bonds, real estate, commodities, and virtually every kind of investment there is, you have to stop and ask yourself, "why?" The only reason the Dow looks like it is going up is because the Fed has pumped so many more dollars into the currency supply, that all asset classes are rising.

Under these conditions, the only way to see where true value lies is to eliminate the dollar from the equation… you have to measure each asset class, not with the dollar, but against another asset class.

Now here's the story in pictures that proves beyond a shadow of a doubt that the stock markets are crashing. You’ve heard the saying "one picture is worth a thousand words". Well, one chart is worth a million numbers, because a chart is simply a picture of at least two sets of numbers, in this case, the price of an item and the date that the item was at that price. Later, I use charts that are a picture of three sets of numbers, the date and the price of one item, divided into the price of another item. These "ratio" charts are my favorites because they reveal true value, and the true direction something is headed. I love charts.

snip>

I like this chart, because it shows you just how much real stuff (on the average) the Dow will buy you. It's the Dow divided by the Commodities Index. Commodities are the stuff you buy, or the stuff that goes into the stuff you buy. What this chart is saying is that you could buy twice as much stuff if you cashed out of the Dow in 1999 as the same number of shares will buy you today. This chart is also saying; "you can take your Dow and stuff it!"



more...

[ozymandius]

6. Nissan senses US market for small, cheap cars

WASHINGTON (AFP) - Sensing an untapped market, Japanese automaker Nissan is "seriously" mulling the launch of a small car in the United States priced under 10,000 dollars, top executive Carlos Ghosn said Wednesday.

Such a move could trigger a major price war in the world's largest car market, but it would also be a high-stakes gamble due to America's love affair with hulking pickup trucks and sports utility vehicles.

Ghosn, the president and chief executive of Nissan as well as French carmaker Renault, told an audience at the Council on Foreign Relations here that US manufacturers had so far ignored the potential market for cars priced under 10,000 dollars.

http://news.yahoo.com/s/afp/20070418/bs_afp/usautocompanynissan

[ozymandius]

7. Kraft's 1Q profits drop 30 percent

CHICAGO - Kraft Foods Inc. is free of its old ownership but not its longtime struggles in the food industry.

The nation's biggest food and beverage company posted mixed results and a 30 percent profit decline for the first quarter, its last under the control of Altria Group Inc., losing U.S. market share in its trademark product lines of cheese, coffee and salad dressing.

First-year Chief Executive Irene Rosenfeld cited encouraging signs of progress but called it "unacceptable" that the Northfield-based company is gaining market share in only about half its U.S. businesses. She repeated what has become a familiar refrain for Kraft investors: The turnaround plan still has a ways to go.

-cut-

Investors have been hopeful that Rosenfeld's initiatives, including a plan to sell more packaged meals to compete with restaurants, would help return Kraft to its earlier industry dominance, driving up its stock 27 percent last year. But it is down this year as it becomes more evident a final solution is not at hand.

http://news.yahoo.com/s/ap/20070419/ap_on_bi_ge/earns_kraft

[ozymandius]

8. Stocks point to lower open after new high

NEW YORK - U.S. stocks pointed to a lower opening Thursday, a day after the Dow Jones industrials closed at a new high, as investors in China sold off stocks amid concerns the country's economy might be growing too quickly.

Stocks fell in China and then Europe following word that growth in China's first quarter jumped a higher-than-expected 11.1 percent and inflation increased at its fastest pace at more than two years. The increases stirred speculation that Chinese officials will take steps such as raising interest rates to curb growth.

While China's sometimes volatile Shanghai Composite Index tumbled 4.5 percent, its decline wasn't as steep as the nearly 9 percent drop Feb. 27 that touched off a worldwide selloff and shaved more than 3 percent from the major U.S. indexes. Stocks fell in Europe Thursday, though at more modest levels than in Asia.

-cut-

First-quarter income from Altria, owner of cigarette maker Philip Morris, fell by 21 percent as it saw weakness in domestic cigarette sales. The company raised its full-year earnings prediction, however, which may offset some of the negative news.

http://news.yahoo.com/s/ap/20070419/ap_on_bi_st_ma_re/wall_street

[ozymandius]

15. Stocks set for selloff

NEW YORK (CNNMoney.com) -- Stock futures turned lower Thursday morning, one day after the Dow Jones industrial average hit a fresh record high, as a mixed bag of earnings reports rattled investors.

Stock futures were down in early trading, indicating a lower open for U.S. markets, after the Dow hit an all-time high Wednesday on upbeat earnings from JPMorgan (Charts, Fortune 500) and others and ahead of earnings from some other key bellwether companies.

Thursday morning, Dow component Altria (Charts, Fortune 500) posted earnings and revenues below Wall Street estimates, while Dow component Merck (Charts, Fortune 500) posted quarterly earnings that met Wall Street expectations.

http://money.cnn.com/2007/04/19/markets/stockswatch/index.htm?postversion=2007041908

[Ghost Dog]

29. Chinese growth spooks Wall St

http://mwprices.ft.com/custom/ft2-com/html-story.asp?pulse=true&siteid=ft&dist=ft&guid=%7B01c4a9d2%2D2610%2D4873%2Db12b%2Dc3e4fc9c218a%7D

Wall Street stocks were set for a sharply lower start on Thursday as concerns about the Chinese economy overheating sparked selling of global equities. The fall in futures – which followed the Dow Jones Industrial Average setting a record high yesterday – came in spite of strong earnings updates from Merrill Lynch, Ebay and Schering Plough. Chinese gross domestic product and March inflation data was well in excess of economists’ forecasts, raising fears that the country’s interest rates may need to be raised to cool the rapid pace of growth. Less than an hour before the opening bell, S&P 500 futures were down 7.4 points at 1,472.9 while Nasdaq futures were down 11.8 points at 1,836.5. Futures for the Dow Jones Industrial Average were down 61 points at 12,797. “It is rather clear that there are reasons for investors to worry. The new highs are spotty, not broad based”, said Marc Pado, chief market strategist at Cantor Fitzgerald. “The bears need a catalyst and may have gotten one in China’s GDP report, showing an explosive 11.1 per cent gain in the first quarter. The fear is that China will have to raise rates or let its currency appreciate quickly. Stronger Asian currencies raise the fears of an unwinding of the carry trade.”

[54anickel]

37. Stocks sink after Dow record

http://money.cnn.com/2007/04/19/markets/markets_nyopen/index.htm

Major gauges start down a day after the Dow hit a record with first close above 12,800.
April 19 2007: 9:42 AM EDT


NEW YORK (CNNMoney.com) -- Stocks opened lower Thursday, a day after the Dow Jones industrials hit a record, as a mixed bag of earnings reports and declines in overseas markets rattled investors.

The 30-share Dow and the S&P 500 both sank about 0.5 percent in the early going. The Nasdaq composite lost about 0.7 percent.

Treasury bond prices crept higher and oil fell.

Overseas, stocks in Asia fell sharply after investors reacted to China's GDP report, which showed that the economy grew 11.1 percent from a year earlier on strong investment and exports. The news fueled fears that Beijing might raise interest rates to cool the economy.

Stocks also fell in Europe. The dollar was lower against the euro and the yen.

"We've had a market that is trending higher and is in record territory," Art Hogan, chief market strategist at Jefferies & Co., said before the market opened.

But "as we look at today's market we've got some fear that perhaps if China's economy slows, the global economy will slow as well," Hogan said, noting that was making investors nervous. :crazy:

[UpInArms]

9. Briggs & Stratton profit drops 87%, cuts outlook

http://www.marketwatch.com/news/story/briggs--stratton-profit-drops/story.aspx?guid=%7BD6679161%2D2082%2D4C0B%2DACD8%2D836C0B69282C%7D&dist=MorePulse

BOSTON (MarketWatch) -- Briggs & Stratton Corp. (BGG : 31.80, -0.13, -0.4% ) said its third-quarter profit dropped 87% to $7.77 million, or 15 cents a share, hurt by a $21.4 million, or 42 cents a share, writedown of assets, primarily a rationalization of a plant in the U.S. Sales dropped 10% to $717 million on declining land and garden equipment and portable generator volumes. Analysts polled by Thomson Financial expected earnings of $1.05 a share on revenue of $798 million. The Milwaukee firm also cut its engine shipment estimates for 2007 by 2%. It sees annual earnings between 38 cents and 54 cents a share, compared to analyst estimates of $1.33 a share.

[ozymandius]

10. Sharp falls for European equities

European stocks fell sharply on Thursday, with global interest rates the main focus of concern after strong Chinese growth raised fears of slowing demand if the country moves to cool its economy.

By midday, the FTSE Eurofirst 300 was down 0.9 per cent to 1,551.28, Frankfurt's Xetra Dax shed 1.2 per cent to 7,197.42 the CAC 40 in Paris lost 0.9 per cent to 5,786.1 and London's FTSE 100 slid 0.6 per cent to 6,410.6.

Oil and mining stocks were among the worst hit after Chinese premier Wen Jaibao said the country needed to take timely measures to prevent economic overheating following first quarter gross domestic product growth of 11.1 per cent.

http://news.yahoo.com/s/ft/20070419/bs_ft/fto041920070709512655

[Ghost Dog]

30. European Stocks Drop, Led by Rio, Miners on China Rate Concern

http://www.bloomberg.com/apps/news?pid=20601085&sid=av6_jfW9fX0o&refer=europe

April 19 (Bloomberg) -- European stocks headed for the biggest drop in three weeks after China's economy grew faster than economists expected, fueling concern the country is preparing to raise interest rates.

Rio Tinto Group and Antofagasta Plc paced a decline by companies most affected by slowing demand from the world's fastest growing major economy. BP Plc slipped as Merrill Lynch & Co. recommended investors reduce their holdings in the company. Nokia Oyj climbed after reporting a gain in market share.

The Dow Jones Stoxx 600 Index dropped 0.8 percent to 382.87 at 1:57 p.m. in London, after falling as much as 1.3 percent. The Stoxx 50 declined 0.7 percent and the Euro Stoxx 50, a measure for the 13 nations sharing the euro, lost 1 percent.

China's economy grew 11.1 percent in the first quarter, a government report showed today, sparking a slide in Asian markets as investors bet officials will boost borrowing costs.

``It's not good news, especially for the mining companies, if the Chinese are successful in slowing the economy,'' said Tony Dolphin, who helps oversee about $125 billion as director of strategy and economics at Henderson Global Investors in London. ``It's likely to mean more measures to tighten policy.''

The government has increased borrowing costs three times in 11 months to cool the economy and curb inflation. Investors are paying closer attention to China after a slide in the nation's benchmark in February sparked a global rout that wiped out $3.3 trillion from the value of global equities.

Spending on factories and real estate accelerated in the first quarter, the statistics bureau said in Beijing. The median estimate of 24 economists surveyed by Bloomberg News was for growth of 10.4 percent from a year earlier.

Metals Drop

National benchmarks slid in all 17 western European markets except that were open except Portugal. The U.K.'s FTSE fell 0.4 percent. France's CAC 40 lost 0.7 percent and Germany's DAX slid 1.1 percent. Stocks have fallen from a 6 1/2-year high this week on growing concern interest rates around the world will increase.

``The worry is an overheating China,'' said Jacques Porta, who is part of a team that oversees $180 million at Ofivalmo Patrimoine in Paris. ``That means inflation will be imported into other countries and China's central bank will be forced to increase interest rates.''

/... (Ugh!)

[Ghost Dog]

31. Russia's GDP grows 8 % in first quarter - Minister of Economic Development and Trade

http://www.itar-tass.com/eng/level2.html?NewsID=11449342&PageNum=0

MOSCOW, April 19 (Itar-Tass) - Russia's Gross Domestic Produce grew 7.9 percent in the first quarter of this year, Minister of Economic Development and Trade German Gref told a Cabinet meeting on Thursday.

The Economic Development Ministry adjusted its GDP growth forecast for 2007 from 6.2 percent to 6.5 percent, Gref said.

[UpInArms]

11. China's GDP up 11.1% in first quarter

http://www.marketwatch.com/news/story/chinas-economy-expands-torrid-111/story.aspx?guid=%7B3FB3ADBC%2D17B4%2D49D6%2DA3DB%2D689F3DBE4D01%7D&dist=morenews

HONG KONG (MarketWatch) -- China's economy grew at a faster-than-expected pace in the first quarter and inflation rose in March above the comfort zone of policy makers, likely spurring additional austerity measures to cool down the mainland's economy.

Analysts also speculated that the odds of higher interest rates improved in the wake of the data. "There will be at least one interest-rate rise, imminently," said Standard Chartered senior economist Stephen Green.

Data released Thursday showed that gross domestic product expanded 11.1% in the March quarter, surpassing consensus expectations that had called for 10.3% growth. The first-quarter growth rate also represented a quickening from the 10.4% pace seen in the final quarter of 2006.

"It's clearly showing that the economy is still on tear and has accelerated again, and the authorities are going to have to work harder to slow growth down," said Peter Morgan, HSBC's chief Asia Pacific economist.

...more...

[Ghost Dog]

20. Yes:

http://news.xinhuanet.com/english/2007-04/19/content_5999119.htm
China's GDP grows 11.1% in 1st quarter
www.chinaview.cn 2007-04-19 15:07:06

BEIJING, April 19 (Xinhua) -- China's gross domestic product (GDP) totaled 5.03 trillion yuan in the first quarter of this year, a growth of 11.1 percent year on year, according to latest figures provided by the National Bureau of Statistics Thursday.

The growth was 0.7 percentage points higher than the year-earlier level.

[Ghost Dog]

21. China's retail sales rise 14.9% in 1st quarter

http://news.xinhuanet.com/english/2007-04/19/content_5999136.htm
www.chinaview.cn 2007-04-19 15:09:09

BEIJING, April 19 (Xinhua) -- China's retail sales rose 14.9 percent year-on-year to 2.12 trillion yuan in the first quarter of this year, Li Xiaochao, spokesman with the National Bureau of Statistics, said on Thursday.

[Ghost Dog]

27. HIGHLIGHTS-China says excess liquidity a problem

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070419:MTFH08162_2007-04-19_07-15-29_PEK354891&type=comktNews&rpc=44
Thu Apr 19, 2007 3:15am ET

BEIJING, April 19 (Reuters) - China's gross domestic product grew an annual 11.1 percent in the first quarter, the National Bureau of Statistics said on Thursday.

Following are highlights of a news conference by the spokesman of the bureau, Li Xiaochao.

LI'S COMMENTS

"Outstanding problems existing in the economic development are: imbalanced balance of payments, excessive liquidity, irrational economic structure and high pressure on energy conservation and pollutant emission reduction," he said in a statement.

"We will adhere to the scientific approach to development, carefully implement various policies set by the central government, continue to strengthen and improve macro controls, actively push forward the reform and opening up, speed up structural adjustments and change the pattern of economic growth."

/.. nothing much more (accesible here)

[54anickel]

39. From that article, it doesn't sound so bad from China's point of view, aside from the inflation rate

snip>

The primary sector posted a growth rate of 4.4 percent and the tertiary sector, including transport, posts and telecommunications, catering, tourism, banking and insurance, recorded an increase of 9.9 percent, the bureau added.

The rapid economic growth was driven by investment, consumption and import and export, said Li Xiaochao, spokesman with the statistical bureau, citing consumption in particular, which grew in an impressive way in the first quarter.

As for the question about whether the Chinese economy is overheated, Li said it was a comprehensive problem, and to judge whether it is overheated, the GDP-growth indicator alone was not enough.

But Li warned that now there existed a risk for the economy to evolve from fast growth to overheating.

According to the bureau, China's consumer price index, or CPI, a major inflation index, grew by 2.7 percent in the first quarter,1.5 percentage points higher than the same period of last year.

The three-month period saw a quicker growth in retail sales together with a slower growth in investment, which was seen as a healthier development for the fast-growing national economy, according to Li Xiaochao.

The nation's retail sales was up 14.9 percent year-on-year to 2.12 trillion yuan (275.2 billion U.S. dollars), with the increment 2.1 percentage points higher than a year earlier.

[Ghost Dog]

22. (Earlier): Asian Stocks Fall From Record on China Interest Rate Concern

http://www.bloomberg.com/apps/news?pid=20601080&sid=azA2ypy2nB.0&refer=asia

April 19 (Bloomberg) -- Asian stocks slid from a record on concern Chinese economic growth and inflation reports today will strengthen the case for interest-rate increases in the region's second-largest economy. China Mobile Ltd. led the drop.

The Morgan Stanley Capital International Asia-Pacific Index lost 1.3 percent to 147.30 as of 2:01 p.m. in Tokyo. The measure yesterday climbed to a record 149.27, completing its recovery from a global rout that was sparked Feb. 27 by the steepest plunge in China's stocks in a decade.

``Investors are using the possibility of an interest rate increase as an excuse to sell,'' said Hideo Arimura, who helps manage $16 billion at Dai-Ichi Kangyo Asset Management Co. in Tokyo. ``People might have connected today's fall in China with the chain reaction of falling stocks in February.''

...

Japan's Nikkei 225 Stock Average lost 1.7 percent to 17,367.87, set for the biggest drop in more than a month. Benchmarks in Australia, China and South Korea all retreated from records, while Pakistan and Sri Lanka were the region's only markets to advance today.

...

`A Good Excuse'

China's government postponed the announcement of the nation's first-quarter gross domestic product until 3 p.m. in Beijing today from 10 a.m. That may indicate it is preparing to report faster-than-expected growth, economists including Societe Generale SA's Glenn Maguire said.

The Hang Seng China Enterprises Index, which tracks the so- called H Shares of 41 mainland companies, dropped 3 percent in Hong Kong. The CSI 300 Index of China's yuan-denominated shares slipped 2.7 percent, trimming its this year's gain to 58 percent.

``The market is concerned that the GDP and other economic figures will be stronger than expected and prompt the government to raise interest rates,'' said Zhang Ling, who manages the equivalent of $1.1 billion at ICBC Credit Suisse Asset Management Co. in Beijing. ``That's providing a good excuse to sell shares in a market that has risen so much this year.''

China's inflation accelerated to 3.3 percent last month, the China Securities Journal reported on April 10, citing unidentified people. The rate was expected to be unchanged at February's 2.7 percent, according to a Bloomberg News survey of economists, after climbing from 2.2 percent in January.

/...

[Ghost Dog]

23. China shares end down provisional 4.5 pct

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070419:MTFH08017_2007-04-19_07-10-07_SHA250064&type=comktNews&rpc=44
Thu Apr 19, 2007 3:10am ET

SHANGHAI, April 19 (Reuters) - Chinese shares ended down more than 4 percent in heavy turnover on Thursday on fears that the Chinese government may hike interest rates to cool its rapidly growing economy.

The government announced after the market closed that China's March Consumer Price Index was up 3.3 percent year on year, versus a forecast of 2.8 percent.

The Shanghai Composite Index fell a provisional 4.52 percent to end at 3,449.016. This was the biggest daily drop in the index since Feb. 27, when it fell nearly 9 percent -- unsettling global markets.

Turnover in the Shanghai A share market hit 186.7 billion yuan on Thursday, compared with 166.5 billion yuan on Wednesday.

Before the market closed, traders noted concerns among investors that China's macroeconomic data for March might show an overheating economy and prompt the central bank to hike interest rates.

/..

[Ghost Dog]

24. Tokyo stocks fall sharply with strong yen dragging down exporters

http://asia.news.yahoo.com/070419/kyodo/d8ojh9180.html

(Kyodo) Tokyo stocks fell sharply on Thursday with investors dumping high-tech and other export-focused issues on the strengthening of the yen against other major currencies.

The 225-issue Nikkei Stock Average dropped 295.36 points, or 1.67 percent, to 17,371.97. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 23.78 points, or 1.37 percent, to 1,706.93.

The key Nikkei index fell more than 200 points in the early morning in line with the U.S. dollar's fall against the yen. It declined further toward the end of the session with losses expanding to more than 440 points at one point in the afternoon.

The dollar slid to two-week lows in the 117 yen level Thursday in Tokyo from the 118 yen range in overnight trading overseas.

"The dollar's fall hit high-tech issues, especially semiconductor makers, which have been actively bought in recent trading," said Hiroaki Kuramochi, managing director at Bear Stearns (Japan) Ltd.

He attributed the falls of the dollar as well as Tokyo stocks to growing speculation regarding an earlier-than-expected interest rate hike in Japan. Behind the speculation was a comment by Bank of Japan Governor Toshihiko Fukui in the morning in which he hinted that the bank would raise rates as needed, Kuramochi said.

/...

[Ghost Dog]

25. BOJ Fukui upbeat on econ, repeats view on policy

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070419:MTFH07644_2007-04-19_06-53-42_T335969&type=comktNews&rpc=44

TOKYO, April 19 (Reuters) - Bank of Japan Governor Toshihiko Fukui on Thursday remained upbeat on the economy in a speech to BOJ branch managers, while fresh data underscored his view that personal consumption is holding up well.

But Fukui offered few clues on the timing of the next rate hike, repeating his standard line that the central bank will adjust interest rates appropriately by closely examining economic and price conditions.

"Japan's economy is expanding gradually" and is expected to achieve sustainable long-term growth, Fukui said in the speech delivered to a meeting of the BOJ's regional branch managers.

Capital spending continues to rise and personal consumption is moving firmly as household income gradually rises, Fukui said at the quarterly meeting on the regional economy, the first to be held since the BOJ raised rates to a decade-high 0.5 percent in February.

Data released earlier on Thursday underscored his optimism, with an unexpected rise in service-sector activity in February signalling that consumption remains in good shape after rebounding from a weak patch last summer.

Japan's tertiary sector index of service industry activity rose 1.0 percent in February from January, compared with a median market forecast of a 0.4 percent drop, government data showed. Continued...

/...

[54anickel]

42. Yen Climbs on Bank of Japan Rate Speculation, Stocks Decline

http://www.bloomberg.com/apps/news?pid=20601083&sid=acnuysmAb5fE&refer=currency

April 19 (Bloomberg) -- The yen climbed on speculation the Bank of Japan will raise interest rates and as investors sought a haven from slumping world stock markets.

The currency gained the most this month against the euro after a Japanese report today showed demand for services unexpectedly gained, adding to evidence of stronger growth. It also advanced against the pound and the Australian dollar after a slide in Asian and European stocks caused traders to pare investments in higher-yielding currencies funded in yen.

``We've seen a sharp hit on the stock markets this morning,'' Simon Derrick, chief currency strategist at Bank of New York, said in London. ``Were that to feed through into a rise in risk aversion that would strengthen the yen as people pull back from'' the carry trade.

snip>

Figures from the Washington-based Commodity Futures Trading Commission show the difference in the number of wagers by hedge funds and other large speculators on a decline in the yen compared with those on a gain -- so-called net shorts -- was 64,841 on Apr. 10, the highest since Feb. 27.

more...

[mojavekid]

71. Prudent Squirrel: ARE WE READY FOR ANOTHER YEN CARRY STOCK FLU?

http://www.financialsense.com/fsu/editorials/laird/2007/0419.html

With the Asian markets all down heavily last night, and the Yen strengthening again, I thought to talk about another possible Yen carry related market sell off.

China bubble trigger

A month or so ago, Premier Wen of China said that their manufacturing and financial bubbles were unsustainable and out of control. This was in light of recent financial tightening in China, increasing reserve requirements for banks to over 10% now, and raising interest rates moderately. It is important to realize that China is determined to do something about their financial bubbles.

The trouble is, there is so much hot money flowing into China, and that combined with a bubble mania in financial assets as well as manufacturing and stocks by Chinese has created a flood of money flowing into their markets.

Since the last year the Shanghai stock index is up over 150% - again at an all time high right now. The recent panic 9% sell off that Tuesday a month or so ago led to a about of panicky selling in Asian markets in general. That both led to and was caused by a rising Yen after the EU stated several months ago that investors should not ‘make one way bets on a weak Yen’. Soon after that statement, there was the Shanghai stock sell off, Asian stock sell offs, and other world sell offs. Eventually, things stabilized, but it took over two weeks of Central bank efforts and calming to stem the repeated bouts of selling into markets world wide.

more at link...

[Ghost Dog]

26. Shanghai copper limit down on China rate rise talk

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070419:MTFH08033_2007-04-19_07-10-52_SP292772&type=comktNews&rpc=44
Thu Apr 19, 2007 3:10am ET

SINGAPORE, April 19 (Reuters) - Shanghai copper prices fell by their daily 4 percent limit on Thursday on speculation that China could be about to raise interest rates in an effort to curb economic growth.

"There is panic selling of copper," a Shanghai dealer said.

Shanghai's most active July copper contract <SCFN7> was at 73,560 yuan a tonne at the close, after earlier falling 4 percent to 72,580 from Wednesday's settlement price.

Shanghai copper hit a 10-month high on Wednesday, when it closed at its daily upside limit of 75,810 yuan.

"The fall may be on worries about today's economic data. The data for the first quarter is certainly too hot and that could test some people's nerves," a dealer said.

"A rate hike would be normal under these conditions."

/...

[54anickel]

49. China Leans Less on U.S. Trade

http://www.nytimes.com/2007/04/18/business/worldbusiness/18yuan.html?_r=2&adxnnl=1&oref=slogin&ref=business&adxnnlx=1176996847-hSZsv7CWC59wgyDwli0BFQ

GUANGZHOU, China, April 16 — At booth after booth at China’s main trade fair this week, the refrain from Chinese business executives is the same: the American market is not as crucial as it used to be.

Instead, Chinese producers of everything from socket wrenches to sport utility vehicles say, their fastest growth these days lies in Europe, Africa, the Middle East, South America and elsewhere in Asia — in other words, practically anywhere other than the United States.

So it is throughout China. With ample support from the Beijing government — including a flurry of trade missions to Africa and assistance with trade fairs in Germany, Australia or someplace in between — Chinese companies are poised to expand into the markets of many of the world’s rapidly growing economies. In some cases, they are running directly into American competitors.

Chinese business representatives at what is still known as the Canton Fair, after this city’s old name, say they are discouraged by weaker growth in the American economy, rising protectionist sentiment in Washington and the decline of the dollar against China’s currency, which makes it more expensive for Americans to buy Chinese products.

snip>

China surpassed Canada in the first two months of this year as the largest exporter to the United States. According to statistics released by the World Trade Organization last Thursday, China also overtook the United States in the second half of 2006 to become the world’s second-largest exporter of goods over all, after Germany.

China is still nearly 25 times as dependent on exports to the United States as a percentage of its total economic output as the United States is on exports to China. Given that the Chinese economy is less than a quarter the size of the American economy, it is all the more striking that Chinese exports to the United States are worth more than six times American exports to China.

The American exports accounted for roughly four-tenths of 1 percent of economic output in the first two months of this year, while Chinese exports to the United States equaled nearly 10 percent of China’s entire output.

The government and companies across China increasingly see a danger in becoming too dependent on a single market. So they are stepping up efforts to sell to other countries, particularly those outside the industrial world. For example, the Great Wall Motor Company, a maker of sport utility vehicles and sedans, has more than quintupled its exports in two years, to 27,505 vehicles last year. Virtually all the increase has come from fast-growing, oil-rich markets like Russia and the Middle East. “Europe and North America are not our primary markets,” the company’s chairman, Wei Jianjun, said.

more...

[mojavekid]

84. The Daily Pfennig 4/19/07: China's GDP Soars!

http://www.kitcocasey.com/displayArticle.php?id=1337

Good day... Well... With no data to review yesterday, the markets just took some profits in the currencies (and why not?), which brought the euro back below 1.36, but by the end of the day, the single unit was playing with the big boys above 1.36 again.

The profit taking was quite evident, because it was across the board and very limited... In other words, there wasn't an axe to grind with one particular currency, and the movement was small...

The dollar index is very close to an all-time low, and yet, I'm not seeing the markets panic... And that's a good thing... Let's just keep this dollar selling flying under the radar, and controlled... The last thing we need right now is to get the markets all lathered up and have them begin to panic. That would bring about some wild volatile trades, and before you knew it, we would be setting records for the currencies every day, much like the end of 2004.

Well... Overnight China posted their first quarter GDP... I'm chuckling right now, because once again the economists and market observers got China all wrong! They collectively said that China's economy would slow down, and that's what really led to the mid-term pause by the commodities last year... China slows down, their demand for commodities/raw materials dries up, and so do their prices.

more at link....

[UpInArms]

13. D.R. Horton (homebuilder) quarterly earnings plunge

http://www.reuters.com/article/bondsNews/idUSN1936345620070419

NEW YORK, April 19 (Reuters) - D.R. Horton Inc., the largest U.S. home builder, on Thursday said quarterly earnings fell 85 percent, in part by charges related to the lower value of land.

For the fiscal second quarter that ended March 31, D.R. Horton earned $51.7 million, or 16 cents per share, down from $352.8 million, or $1.11 per share, a year earlier.

The Fort Worth, Texas-based builder said results included charges totaling $81.2 million, or 16 cents per share for land options forfeited and for the lower value of inventory of land and houses it owns.

<snip>

"Market conditions in the home-building industry continue to be challenging in most of our markets as inventory levels of both new and existing homes remain high, and further increases in the use of sales incentives continue to put pressure on profit margins," Chairman Donald Horton said in a statement.

...more...

[UpInArms]

16. CEOs see protectionism biggest US economy threat (asswipes)

http://www.reuters.com/article/bondsNews/idUSN1817734220070419

WASHINGTON, April 19 (Reuters) - Unfolding problems in the
subprime mortgage market are less of a threat to the U.S.
economy than trade protectionism, rising health care costs and
frivolous lawsuits, according to a Financial Services Forum
survey released on Thursday.

Chief executives at 20 of the world's biggest financial
services institutions also saw 2.5 growth in the U.S. economy
for 2007. For the first quarter, the economy should expand at a
2 percent rate, the survey found.

The executives were asked to use a scale of 1 to 5 to rank
a variety of issues that threaten the U.S. economy, with 5
being the most serious threat. Protectionism was the top worry
with a ranking of 3.8, followed by frivolous litigation at 3.5.
The next three threats -- health care costs, the U.S. housing
market, and higher tax rates -- each ranked at 3.47.

...more...

[modrepub]

19. Weak Sales Tax Revenues

Weak sales tax revenue seen trouble for states

By Dean Patterson
Thu Apr 19, 12:32 AM ET

http://news.yahoo.com/s/nm/20070419/us_nm/munis_states_dc_1

WASHINGTON (Reuters) - Weakening sales tax collections may foreshadow a potential downturn in U.S. state budgets, which have been riding high in recent years on a strong economy and generally robust tax receipts, a report said on Thursday.

<snip>

The figures were dramatic but are volatile by nature. Only 18 percent of states surveyed met or exceeded their sales tax projections last month, the report said. About a third of those surveyed said sales tax receipts were down from a year ago, some "quite steeply," the report added.

<end>

So how does this jive with the increased sales reports the feds keep pumping out? Guess their counting all that state tax-free sales on Ebay...

[AnneD]

91. Wait til..

local and state government gets caught in declining property spiral.

[Ghost Dog]

32. Freddie Mac marks $20B for subprime bailout

http://money.cnn.com/2007/04/18/news/companies/freddie_mac.reut/index.htm?postversion=2007041813
Mortgage finance company says it will provide new financing to help people with subprime mortgages stay in their homes.
April 18 2007: 1:34 PM EDT

WASHINGTON (Reuters) -- Mortgage finance company Freddie Mac promised $20 billion in new financing to help subprime borrowers stay in their homes, the company's chief executive said on Wednesday.

The funding is aimed at helping "people who may be in the wrong kind of product but who have credit standards that we can put in a more traditional, longer-term, fixed rate kind of product," said Freddie CEO Richard Syron.

/..

[54anickel]

36. 10:00 numbers

Dow 12,771.65 32.19 (0.25%)
Nasdaq 2,498.58 11.92 (0.47%)
S&P 500 1,467.42 5.08 (0.34%)
10-yr Bond 4.6420% 0.0120
30-yr Bond 4.8130% 0.0060
NYSE Volume 387,622,000
Nasdaq Volume 312,607,000

09:40 am : Less than a week after the Dow, S&P 500 and Nasdaq finally got back to levels prior to the global sell-off on February 27 tied to a possible unwinding of the yen carry trade, all three indices this morning are succumbing to the resurfacing of similar concerns. This time around, higher than expected GDP and CPI reports from China have provoked fears of a possible rate hike, which may in turn lead to a resurgence in risk aversion similar to that exhibited throughout the month of March.

While it is likely investors would be taking money off the table anyway today, with the Dow posting its 13th gain in 14 days and closing at record levels, a sense the market is overextended has been exacerbated by the sell-off in Asian markets and overshadowing another round of better than expected earnings reports. DJ30 -50.71 NASDAQ -17.50 SP500 -7.03 NASDAQ Vol 92 mln NYSE Vol 50 mln

09:15 am : S&P futures vs fair value: -7.0. Nasdaq futures vs fair value: -9.0.

09:00 am : S&P futures vs fair value: -7.0. Nasdaq futures vs fair value: -8.0. The stage remains set for stocks to open on a downbeat note, but it is worth noting that early nervousness tied to a possible unwinding in the yen carry trade continues to abate. Futures still trades below fair value, signaling a lower open for the cash market, but it appears investors are merely using renewed concerns the Chinese government may step up its efforts to curb speculative buying interest as another excuse to consolidate a U.S. market that is ripe for a pullback. As a reminder, the variances in the Chinese economy and financial markets have only a marginal impact on the U.S. economy.

08:33 am : S&P futures vs fair value: -7.3. Nasdaq futures vs fair value: -9.5. Futures trade has improved slightly since the last update, as the bulk of earnings continue to check in above analysts' estimates; but early indications still point to a sharply lower open for stocks. Meanwhile, investors are sifting through the latest read on labor conditions. Initial claims, which were compiled during the same week as the crucial monthly payrolls report, fell 4,000 to 339,000 (consensus 320K) but are still at high levels, again signaling a softening in the job market. The yield on the 10-year note (+5/32) has fallen to 4.63% from 4.64% prior to the report.

08:00 am : S&P futures vs fair value: -8.2. Nasdaq futures vs fair value: -11.0. As evidenced by the late-day selling pressure that closed the indices off their highs yesterday, it's not surprising to see some of that consolidation attempt carrying over into this morning's pre-market action, especially with the Dow still managing to finish in record territory.

Investors are also taking a bearish cue from a sell-off in overseas markets as concerns of a possible rate hike in China renew fears that an unwinding of the yen carry trade may lead to a liquidity crisis as investors become more risk averse. Such concerns so far are overshadowing this week's largest batch of earnings reports which, on balance, are better than expected.

06:17 am : S&P futures vs fair value: -8.4. Nasdaq futures vs fair value: -10.8.

06:17 am : FTSE...6405.50...-43.90...-0.7%. DAX...7187.44...-94.90...-1.3%.

06:17 am : Nikkei...17371.97...-295.36...-1.7%. Hang Seng...20299.71...-477.38...-2.3%.

[ozymandius]

45. 11:00 - watching paint dry

Dow 12,769.70 Down 34.14 (0.27%)
Nasdaq 2,501.11 Down 9.39 (0.37%)
S&P 500 1,468.13 Down 4.37 (0.30%)
10-Yr Bond 4.658% Up 0.004
NYSE Volume 931,159,000
Nasdaq Volume 681,645,000

11:00 am : The market's recent attempts to shrug off early consolidation efforts tied largely to overseas weakness have run into some resistance. The Tech sector's failure to stay positive has removed some notable leadership. Novellus Systems (NVLS 31.06 -1.65) is the sector's biggest laggard (-5.0%) after missing analysts' expectations and issuing weak bookings guidance.

Not even the defensive characteristics of the Health Care sector (+0.2%) have been able to convincingly attract buyers. While Biotech remains the sector's best performer (+2.9%), Managed Health (-2.7%) earmarked as today's worst performing S&P industry group is acting as an offset. Unitedhealth Group (UNH 52.05 -2.16) is plunging 4% after posting lower than expected Q1 revenue and forecasting higher medical costs for the full year. DJ30 -35.44 NASDAQ -8.96 SP500 -4.18 NASDAQ Dec/Adv/Vol 1919/810/668 mln NYSE Dec/Adv/Vol 2099/873/442 mln

[54anickel]

47. ResCap to cut 1,000 more jobs

http://www.startribune.com/535/story/1130085.html

Residential Capital will eliminate more than 1,000 jobs as the company tries to regain its footing amid a severe slump in the subprime mortgage market.
The Bloomington-based mortgage lender, one of the country's largest, said Wednesday that about 86 positions in the Twin Cities will be affected. The company, which is jointly owned by General Motors Corp. and Cerberus Capital Management, employs 1,900 people in Minnesota.

The cuts come on top of a 1,000-job reduction the company announced this year, which included 47 local positions. Together, the two rounds of job cuts represent about 15 percent of Residential Capital's 13,000-strong workforce.

Most of the layoffs will be in the company's U.S. home mortgage operations and corporate services, which includes finance, human resources, legal and marketing, according to company spokesman Brett Weinberg.

"Because the U.S. mortgage market continues to underperform, we regret to have to announce additional layoffs," Chief Operating Officer Jim Jones wrote in a memo to employees. "The reductions are an unfortunate necessary step in the plan to return to health and profitability, and to position us to effectively capitalize on the opportunities ahead."

About a third of the 1,000 positions are already vacant, leaving 600-plus people who will actually lose their jobs.

more...

[54anickel]

48. Housing Bust Meets the Equity-Withdrawal Blues

http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_sperling&sid=a.mcWxg9aJ_E

April 19 (Bloomberg) -- While the subprime and exotic mortgage fallout has been grabbing recent housing headlines, another potential story for 2007 may be in the wings: as Americans withdraw less equity from their homes will it mean a big or little hit for growth and consumer spending?

The connection between housing and consumption isn't a new story. Economists have long assumed that there is a so-called wealth effect from rising home prices: for each dollar of housing wealth accumulated, people spend anywhere from 4 cents (as conventional economic models predict) to 9 cents, as John Hopkins economist Christopher Carroll found in a December study.

Yet, the dramatic expansion of mortgage-equity withdrawal, or MEW, by homeowners over the last decade has raised new and less-settled issues over whether housing wealth now has a greater impact on consumption that ever before. Many -- me included -- have likened home-equity withdrawals to automated-teller machines, with owners literally taking money out of their houses to bolster consumption.

Goldman Sachs Group Inc. has found that consumers spend about 50 cents for each dollar of home-equity extraction and cash-out refinancing. The International Monetary Fund, using a different methodology, has found that 18 cents are spent per dollar of home-equity withdrawal.

snip>

The explosion of mortgage-equity withdrawal over the recent housing cycle was given greater prominence by the Federal Reserve, thanks to work by former Fed Chairman Alan Greenspan and Fed economist Jim Kennedy. In December 2005, Greenspan and Kennedy published a new, comprehensive measure of equity withdrawal that went beyond the information provided in the Fed's Flow of Funds data.

Amazing Development

Their research showed an amazing development. Between 1995 and the final quarter of 2005, equity withdrawal grew to 8 percent of the economy from 1 percent -- a whopping 800 percent increase. And as of the fourth quarter of 2005, when total MEW had reached its peak, it stood at $1 trillion annualized.

snip>

Surprisingly, even with this steep slide, real spending was a bullish 4.2 percent in the final quarter of 2006. The muscular March retail sales report was one more piece of evidence for those skeptical that the causal connection between MEW and consumer spending isn't nearly as robust as some like me have assumed. :spray:

Nick of Time

It could also mean that we are seeing some long-awaited wage growth just in the nick of time to help cushion the hit on consumption due to falling equity withdrawals and home prices. :spray: :spray:

more...

Oh what a tangled web we weave,
When first we practise to deceive!

[mojavekid]

50. The Daily Reckoning: Buy Tangible Assets, Not Paper

http://www.dailyreckoning.com.au/tangible-assets/2007/04/16/

Only in the investment game does rock ever beat paper. Normally, if you throw down a flat palm in an old-fashioned game of Paper, Scissors, Rock, paper wins, smothering the rock. But in investment markets, if we take rock to represent “stuff” and paper to represent “paper assets” then “rock” is on a roll. Rock on.

By rock, we also mean, “tangible assets and resources” as opposed to say, mortgage-backed securities and credit derivatives. Part of what you’re seeing this week is the steady migration out of paper-backed assets and into tangible assets. Roughly, generally, and simplistically speaking, this is bad for America and its dollar, but good for Australia and its dollar.

Granted, we should note that a share in a resource company, even a great one like BHP, is a paper claim on real wealth. You are still one step removed from actual ownership of a tangible asset. You don’t own red iron ore from the Pilbara itself. You own BHP common.

more at link...

[mojavekid]

51. Credit Card Debt: Symptom of Sick Housing Market

http://www.thetrumpet.com/index.php?page=article&id=3109&ref=patrick.net

Several years ago, Wes Wannemacher charged $3,200 on a credit card to pay for expenses related to his wedding. After six years, he had paid approximately $6,300 dollars toward that debt, yet by February 2007 he still owed $4,400—more than he had charged in the first place.

Mr. Wannemacher’s story is all too familiar to many Americans. Once you get trapped in credit card debt, it can become a never-ending cycle of penalties, late charges, fees, and sky-high interest rates.

Evidence suggests credit card debt is becoming increasingly common. In January, revolving credit, which is largely credit card debt, was up a whopping 6.4 percent over the previous year. Economists predict that the pace quickened further in February.

more at link...

[54anickel]

56. Hmmm, is that what's replacing the MEW ATM? Ill be interesting to

see if there's a rise to coincide with the supposed increase in consumer spending. Anyone wanna lay odds? :evilgrin:

[Egnever]

63. Oh my

I quit my credit cards years ago if i cant pay for it in cash I don't need it. This looks real bad though, combine this with the new bankruptcy laws and people are soon going to be nothing more than indentured servants.

Add this financial cataclysm to our global warming troubles and we appear to be approaching end times at a frightening pace. Lord knows I need that plasma TV though!

[burf]

64. The good news is

because inflation is "under control" and the strength of the dollar those plasma TVs are getting cheaper everyday! /sarcasm/

[AnneD]

90. How much ...

plasma do you have to sell to buy a plasma. I'll have to see what the going rate is. Or how about a kidney, lung, or slice of liver (it is one of the few of our organs that regenerate). I know what my next hot business will be...AN ORGAN BROKER. Talk about the perfect culture of life job. I'll be rich I tell ya, rich.:sarcasm:

[54anickel]

59. The Next People Car

http://finance.yahoo.com/family-home/article/102865/the-next-peoples-car

An Indian car may soon earn a parking place in history alongside Ford's Model T, Volkswagen's Beetle and the British Motor Corp.'s Mini, all of which put a set of wheels within reach of millions of customers after they rolled onto the scene. Tata Motors is developing a car it aims to sell for about $2,500--the cheapest, by far, ever made.

There is a lot riding on its small wheels. If the yet-to-be-named car is a success when it goes on sale next year, it would herald the emergence of Tata Motors on the global auto scene, mark the advent of India as a global center for small-car production and represent a victory for those who advocate making cheap goods for potential customers at the "bottom of the pyramid" in emerging markets. Most of all, it would give millions of people now relegated to lesser means of transportation the chance to drive cars.

It is a hugely ambitious project--rivals have called it impossible--for any company. But it is audacious for one that hadn't even built cars a decade ago.

For decades Tata Motors has been India's largest commercial vehicle maker--the Tata logo appears on buses, dump trucks, ambulances and cement mixers. Sturdy as elephants, they are a fixture of the Indian landscape. Owners inevitably paint the exteriors in a cheerful riot of bright red, green, orange, blue and yellow and line the un-air-conditioned cabs with teakwood to keep them cooler in India's searing heat.

However ubiquitous, Tata's trucks faced a problem after the Indian government began reforms that opened the Indian economy in 1991: the huge cyclical swings in demand typical for commercial vehicles. To diversify, Tata would enter, at great expense, the less volatile passenger car market.

more...


Ewww, that brought this to mind...

http://www.youtube.com/watch?v=RjrEQaG5jPM

[AnneD]

60. Words of profound wisdom...

I make no bones about it. I love Warren Buffet. He is a giant walking around the pygmies of Wall Street. He gets it and gets it right to my way of thinking. I was thumbing through a book in the book store last night. I couldn't buy it, but I took the time to copy one of the pearls for you.

"The smarter the journalists are, the better off society is."

"We get information for processing investment ideas from the media, which means we are wholly dependent on journalists for accuracy and proper analysis of what is going on. Do you want dumb people keeping us informed, or do you want intelligent people doing the job. Warren has always subscribed to the idea that the better the teacher, the smarter the student body. Thus the smarter the society. The only people who won't want a smarter society are liars, thieves, and politicians who are trying to hide something ."

The Tao of Warren Buffet page 53

:applause: :applause: :applause:

[54anickel]

65. 1:58 and a rally in the pits!

Dow 12,827.89 24.05 (0.19%)
Nasdaq 2,512.93 2.43 (0.10%)
S&P 500 1,473.66 1.16 (0.08%)
10-yr Bond 4.6740% 0.0200
30-yr Bond 4.8440% 0.0250
NYSE Volume 1,884,351,000
Nasdaq Volume 1,379,409,000

1:30 pm : Not much has changed since the last update, but the Dow continues to inch its way even further into unchartered territory. Even though the index's intraday gain remains modest in scope (+0.2%), the psychological impact of it hitting new all-time highs is helping to provide a floor of improved sentiment across the board.

Intel (INTC 21.89 +0.54) is pacing the way with a 2.5% advance among the 21 components trading higher following an analyst upgrade. Another notable Dow winner is Honeywell (HON 49.21 +1.00), which is hitting fresh multi-year highs heading into its Q1 results tomorrow morning. Altria Group (MO 69.36 -0.72) remains the Dow's worst performer today (-1.0%) after its quarterly results fell shy of analysts' expectations. DJ30 +24.48 NASDAQ +3.86 SP500 +1.33 NASDAQ Dec/Adv/Vol 1629/1278/1.31 bln NYSE Dec/Adv/Vol 1832/1308/936 mln

1:00 pm : Stocks are quietly extending their reach to the upside as investors continue to embrace upside leadership from the S&P 500's four most heavily weighted sectors. Health Care is now turning in the best performance, tacking a 0.7% gain on to its 6.9% year-to-date advance.

Aside from renewed enthusiasm for Amgen (AMGN 63.12 +3.11) shares giving a boost to Biotech (+4.0%), the group is also getting a lift from a handful of names (e.g. MEDI +2.8%, CELG +4.7%) that have been mentioned in the past as LBO/acquisition candidates. Pharmaceuticals (+1.1%) also rank among today's best performers as Schering-Plough (SGP 31.02 +2.47) soars nearly 9% to a multi-year high after posting a 55% rise in Q1 earnings.BTK +1.4% DJ30 +15.68 NASDAQ +3.71 SP500 +1.21 NASDAQ Dec/Adv/Vol 1701/1173/1.22 bln NYSE Dec/Adv/Vol 1981/1135/860 mln

12:30 pm : Buyers continue to show some resolve, kicking off the afternoon session by lifting the major averages into positive territory for the first time today. The Financials sector turning the corner returns some very influential leadership. Specialized Financials (+0.8%) and Thrifts & Mortgage (+0.8%) have recently broken into today's top ten.

Separately, the Philly Fed recently checked in below forecasts; but investors so far appear somewhat relieved that the report showed overall activity in the region's manufacturing sector was steady this month and that new orders edged higher. DJ30 +6.90 NASDAQ +2.38 SP500 +0.56 NASDAQ Dec/Adv/Vol 1710/1147/1.08 bln NYSE Dec/Adv/Vol 2033/1073/760 mln

12:00 pm : The indices are trading just below the flat line and well off their opening lows midday as investors try to look past a sell-off in Asian markets sparking early concerns of a liquidity crisis and overbought market conditions.

With the Dow posting its 13th gain in 14 days and closing at record levels yesterday, a sense the market is overextended was exacerbated early on by renewed worries the Chinese government may step up its efforts to curb speculative buying interest. Higher than expected GDP and CPI reports from China had provoked concerns about a possible rate hike, which may in turn lead to an unwinding in the yen carry trade and resurgence in risk aversion similar to that exhibited throughout the month of March. However, such concerns continue to abate as participants still find value across a handful of sectors.

Of the five sectors trading lower, Energy (-0.9%) paces the way as a 2.0% drop in oil prices makes everything from explorers to refiners less attractive. Consumer Discretionary ranks second as disappointing RevPAR guidance from Marriott International (MAR 48.51 -3.36) earmarks Hotels (-2.5%) as today's worst performing S&P industry group.

On the positive side of things, Industrials is turning in the best performance, benefiting primarily from strength in Railroads (+2.6%) after Union Pacific (UNP 118.30 +4.52) handily topped Wall Street expectations citing improved margins and pricing. Transportation stocks are getting an added boost from oil's sharp downturn.

Health Care is the only other sector posting a respectable gain, but is not getting much of a lift from Merck's (MRK 49.92 +0.23) in-line report. The bulk of sector support is coming from Biotech (+3.3%) fueled by a relief rally in Amgen (AMGN 63.00 +2.99), following upbeat results from a study regarding its blockbuster Aranesp drug, as well as an upbeat Q1 report from Gilead Sciences (GILD 81.73 +3.30) last night. DJ30 -7.21 NASDAQ -1.60 SP500 -0.75 NASDAQ Dec/Adv/Vol 1884/954/960 mln NYSE Dec/Adv/Vol 2090/985/660 mln

11:30 am : A renewed wave of buying interest within the last 30 minutes now leaves all three major indices at their best levels of the morning and inching closer to the unchanged mark. While another turnaround in Technology is among the most noticeable reasons for the market's latest recovery, oil prices recently plunging to session lows below $62/bbl are the driving catalysts behind the improved sentiment.

Crude for May delivery, which expires tomorrow, is now down 2.3% near $61.70/bbl following reports that Enbridge has resumed shipments through a previously shutdown pipeline from Canada, last year's biggest source of U.S. crude-oil imports. Crude was down as much as 2.8% at $61.34/bbl.DJ30 -15.07 NASDAQ -4.48 SP500 -2.05 NASDAQ Dec/Adv/Vol 1930/799/790 mln NYSE Dec/Adv/Vol 2144/884/550 mln

11:00 am : The market's recent attempts to shrug off early consolidation efforts tied largely to overseas weakness have run into some resistance. The Tech sector's failure to stay positive has removed some notable leadership. Novellus Systems (NVLS 31.06 -1.65) is the sector's biggest laggard (-5.0%) after missing analysts' expectations and issuing weak bookings guidance.

Not even the defensive characteristics of the Health Care sector (+0.2%) have been able to convincingly attract buyers. While Biotech remains the sector's best performer (+2.9%), Managed Health (-2.7%) earmarked as today's worst performing S&P industry group is acting as an offset. Unitedhealth Group (UNH 52.05 -2.16) is plunging 4% after posting lower than expected Q1 revenue and forecasting higher medical costs for the full year. DJ30 -35.44 NASDAQ -8.96 SP500 -4.18 NASDAQ Dec/Adv/Vol 1919/810/668 mln NYSE Dec/Adv/Vol 2099/873/442 mln

[54anickel]

66. 2:31 - whoopsie, floors a bit slippery today

Dow 12,799.53 4.31 (0.03%)
Nasdaq 2,506.52 3.98 (0.16%)
S&P 500 1,470.35 2.15 (0.15%)
10-yr Bond 4.6760% 0.0220
30-yr Bond 4.8430% 0.0240
NYSE Volume 2,070,668,000
Nasdaq Volume 1,538,271,000

2:30 pm : In similar fashion to yesterday's late-day breakdown, stocks have succumbed to some afternoon consolidation. This time around, though, market gains were so minimal that a renewed wave of modest selling pressure has been enough to push the major averages back below the flat line.

The most noticeable contributors to the recent pullback have been collapses in Financials and Technology, which removes leadership from two sectors that combine to account for nearly 37% of the total weighting on the S&P 500. DJ30 -3.58 NASDAQ -4.14 SP500 -2.05 NASDAQ Dec/Adv/Vol 1773/1175/1.53 bln NYSE Dec/Adv/Vol 1880/1296/1.08 bln


2:00 pm : More of the same for stocks as equities remain on the offensive but market internals still hold a negative slant. Decliners on the NYSE hold a nearly 3-to-2 edge over advancers while those on the Nasdaq hold a 4-to-3 margin.

A split ratio of up to down volume, though, paints a more accurate picture since the large-cap names acting as this week's biggest sources of support tend to be widely held and enjoy more institutional participation. AMD, PFE, and SGP are up 4.5% on average today and are among the most actively traded NYSE-listed securities, accounting for roughly 10% of the total volume on the Big Board. DJ30 +24.70 NASDAQ +2.38 SP500 +1.35 NASDAQ Dec/Adv/Vol 1694/1221/1.40 bln NYSE Dec/Adv/Vol 1893/1275/990 mln

[citizen snips]

67. Merck 1Q Profit Jumps 12 Percent

TRENTON, N.J. (AP) -- Merck & Co. Inc. said Thursday its first-quarter profit jumped 12 percent, as the drugmaker posted sharply higher sales of its asthma and cholesterol drugs, plus one-time gains from product divestitures.

Meanwhile, the number of personal injury lawsuits in the massive litigation over the painkiller Vioxx, which Merck withdrew from the market in September 2004 due to increased risk of heart attack and stroke, declined slightly for the first time.

The Whitehouse Station, N.J.-based maker of Fosamax for osteoporosis and Singulair for asthma and allergies posted net income of $1.7 billion, or 78 cents per share, up from $1.52 billion, or 69 cents per share, in the first quarter of 2006.

Excluding a charge of 6 cents per share, or $186 million, for its ongoing global restructuring program, Merck said income would have been 84 cents per share. That matched the forecast of analysts surveyed by Thomson Financial, who had bumped up their estimates last Thursday when Merck raised its earnings forecast by 15 cents.

more...
http://biz.yahoo.com/ap/070419/earns_merck.html?.v=17

[citizen snips]

68. Merrill Lynch 1Q Profit Soars 30 Percent

NEW YORK (AP) -- Merrill Lynch & Co.'s first-quarter profit soared more than 30 percent, the nation's largest retail brokerage said Thursday, thanks to strong revenue from investments and takeover activity.

The results surpassed expectations, and cemented the notion that major financial companies have emerged unscathed from the stock market's turbulent first quarter and troubles in subprime lending.

Excluding a charge incurred last year related to a change in accounting and retirement policies, Merrill Lynch posted a 31 percent rise in profit in the first quarter from the same period a year ago.

The New York-based financial company reported net income of $2.11 billion, or $2.26 per share, after preferred dividends. This was up from $432 million, or 44 cents per share, a year ago, when it recorded $1.2 billion in one-time compensation expenses. Excluding those expenses, the company earned $1.61 billion, or $1.65 per share, a year ago.

more...
http://biz.yahoo.com/ap/070419/earns_merrill_lynch.html?.v=12

[citizen snips]

69. Altria Reports 21 Pct Drop in 1Q Profit

NEW YORK (AP) -- Altria Group Inc., owner of the Philip Morris cigarette companies, said Thursday that first-quarter income fell by 21 percent as domestic cigarette sales dropped off more severely than expected.

Chief Financial Officer Dinyar S. Devitre also said Philip Morris International was ready to be spun off, if the board decided to do so. Analysts are predicting that Altria will split its domestic and international units later this year.

The company also raised its full-year earnings prediction.

Net income dropped to $2.75 billion, or $1.30 per share, from $3.48 billion, or $1.65 per share, in the same period last year.

more...
http://biz.yahoo.com/ap/070419/earns_altria.html?.v=10

[citizen snips]

70. Bank of America 1Q Profit Up 5 Pct

CHARLOTTE, N.C. (AP) -- Bank of America Corp. said first-quarter earnings rose 5 percent, helped by growth in fee income despite a challenging credit environment, buts its revenue was shy of Wall Street expectations.

The results released Thursday -- which several industry analysts characterized as good, but not great -- didn't impress investors, who sent the bank's shares down 91 cents, or 1.8 percent, to $50.91 in midday trading on the New York Stock Exchange.

The Charlotte, N.C.-based bank, the nation's second-largest by assets, was the last of the major money center banks that reported earnings this week.

Its strength in investment banking revenue, which increased 35 percent in the first quarter, echoed earlier reports from Citigroup Inc., the nation's largest financial institution, and JPMorgan Chase & Co., the third-largest bank. Both banks are in New York.

more...
http://biz.yahoo.com/ap/070419/earns_bank_of_america.html?.v=9

[mojavekid]

72. Jim Willie: PETRODOLLAR & IRAN & IRAQ

http://www.financialsense.com/fsu/editorials/willie/2007/0419.html

The focus on gold and the USDollar alone lacks a crucial factor in maintaining the world currency reserve on its fragile pedestal. The PetroDollar is a term used to describe the close relationship between the USDollar and the crude oil export business dominated by Saudi Arabia, manifested in the superstructure of the global banking system. So one could say the oil world provides the pool from which the US$ exchange rate valuation is applied and enforced. The gold community pays far too little attention to crude oil factors in my opinion, but Adam Hamilton does indeed. Gold investors love to point to Iran war tensions as a factor to lift the gold price, but they might overlook how the associated earthquakes in banking shift the very ground under the world currency reserve.

Iran has begun to sell its oil in euro currency transactions, already to China, and next to Japan. The gold market should rejoice, when they are actually not paying attention to this grand development. Petro sales outside the US$ realm represent the first of several tectonic shifts in global banking. Direct impact is assured to gold, once the certain changes are realized to bank systems. Imagine Japan changing the emphasis of their entire FOREX reserves management because they purchase a large block of crude oil from Iran, and pay in euros. How much more Persian Gulf oil will China purchase? How much will their future bills be due in euro terms? This article contains a capsule summary taken from the energy section of the April Hat Trick Letter, with a finale based in dark humor.

As a preface, the Gulf Arab currency talks ended with little progress in Medina Saudi Arabia. The meeting was to work toward a monetary union plan by its deadline of 2010. Governor of the United Arab Emirates central bank Al-Suweidi cast doubt in January that the six key Persian Gulf oil producers could hammer out any currency exchange rate regime as preparation for a single currency. The group wishes to clinch a deal like what the European Union has in place. My gut says such a unified currency would help defend the USDollar and its unofficial oil standard, by means of a single controllable device. The USGovt and bankers might require this device in order to exert strong influence on the increasingly independent sheikdoms scrambling to prevent massive losses in the foreign reserves.

Plenty more at link...

[citizen snips]

73. Chip Snap: Semiconductor Stocks Edge Up

NEW YORK (AP) -- Semiconductor stocks inched up in Thursday's trading, despite disappointing earnings results from the likes of Spansion Inc. and Novellus Systems Inc.

The Philadelphia Semiconductor Sector Index climbed 2.69 points, or .6 percent, to 486.14. Of the 19 index components, 16 were trading up.

Advanced Micro Devices Inc., which is scheduled to report first-quarter results after the closing bell, was one of the biggest gainers in the space. The stock spiked in midday trading, climbing 50 cents, or 3.6 percent, to $14.41 on the New York Stock Exchange.

Analysts are expecting AMD to post an average loss of 48 cents per share on $1.26 billion in revenue, according to a Thomson Financial survey.

more...
http://biz.yahoo.com/ap/070419/sector_snap_semiconductors.html?.v=1

[citizen snips]

74. Sector Snap: Oil Shares Fall With Prices

NEW YORK (AP) -- Weaker oil prices took a toll on shares of oil producers and refiners Thursday, and many of the nation's largest players in the sector saw their stock prices stumble.

Oil prices shed more than $1 as a buildup of crude inventories at a key delivery point in Oklahoma weighed on market sentiment.

Shares of Exxon Mobil Corp., the world's largest publicly traded oil company, fell 57 cents to $77.63 on the New York Stock Exchange. Chevron Corp. shares slipped 59 cents to $77.18, and ConocoPhillips shares shed 44 cents to $69.40.

Occidental Petroleum Corp. shares traded 78 cents lower at $50.34.

more...
http://biz.yahoo.com/ap/070419/oil_sector_snap.html?.v=1

[citizen snips]

75. Nasdaq 1Q Profit Up 1.7 Percent

NEW YORK (AP) -- Nasdaq Stock Market Inc., the nation's second-largest stock exchange, on Thursday reported first-quarter profit rose 1.7 percent as charges related to its failed bid for the London Stock Exchange pared gains from new listings and trading.

The world's largest electronic marketplace said it captured more business in trading rival New York Stock Exchange's listed stocks, and had its best showing for initial public offerings since the dot-com boom. But, expenses tied to its $5.3 billion hostile acquisition for the British stock market weighed on results during the first three months of the year.

Chief Executive Robert Greifeld said the quarter showed its strategy of building up its U.S. stock trading business has paid off, and that pursuing a deal is not one of its top priorities. However, he still remains in talks with both domestic and international exchanges about potential deals that might fit its strategy.

"We pay attention to what happens in Europe, and are certainly cognizant of what it could represent in the European theater," Greifeld said during a conference call. "But, we are first and foremost about executing this domestic business plan," he said.

more...
http://biz.yahoo.com/ap/070419/earns_nasdaq.html?.v=3

[citizen snips]

76. Sector Snap: Airlines Slip

NEW YORK (AP) -- Airline stocks headed down in mixed trading Thursday, as some and analysts carriers expressed concern about domestic travel.

The discouraging domestic outlook from two carriers was enough to offset falling oil prices, which tend to help airline stocks, a better-than-expected first-quarter profit from Continental Airlines Inc. and an analyst's upgrade of Frontier Airlines Holdings Inc.

The Amex Airline Index fell about half of 1 percent, with eight of 11 component stocks declining.

Southwest reported first-quarter profit in line with Wall Street expectations, but also said it may become "less reliant on fare increases" for future unit-revenue growth amid cooling growth in domestic travel.

more...
http://biz.yahoo.com/ap/070419/airlines_sector_snap.html?.v=1

[citizen snips]

77. Marriott Falls on Lower Revenue Forecast

NEW YORK (AP) -- Shares of Marriott International Inc. slipped Thursday as the hotel operator lowered growth expectations for a key revenue metric.

The company also said its North American, company-operated comparable revenue per available room, or revpar, climbed 5.2 percent in the first quarter, versus its prediction of growth at the lower end of 7 percent to 9 percent.

Marriott said it anticipates North American revpar will rise 6 percent to 8 percent in 2007, down from its prior forecast for an increase between 7 percent and 9 percent.

The company reduced its estimate on weaker year-over-year growth in January and more modest revpar growth in limited service hotels.

more...
http://biz.yahoo.com/ap/070419/marriott_international_mover.html?.v=1

[citizen snips]

78. Linear Hits New Year High on Buyback

NEW YORK (AP) -- Linear Technology Corp., a maker of mixed-signal analog processors, jumped in Thursday's trading for the second consecutive day, driven by the company's announcement of a substantial stock repurchase program.

The company said it would buy back roughly $3 billion in shares of common stock with the proceeds from a $1.7 billion convertible note offering and with existing cash on hand.

Thanks to the buyback announcement, the stock rocketed 12 percent on Wednesday to a closing price of $36.04. The rally continued on Thursday when shares of Linear Technology, which have traded between $27.80 and $36.62 over the last 52 weeks, climbed $1.38, or 3.8 percent, at $37.42 on the Nasdaq Stock Market.

Earlier in the session shares set a new 52-week high of $37.46.

more...
http://biz.yahoo.com/ap/070419/linear_technology_second_look.html?.v=1

[citizen snips]

79. Sector Snap: Yahoo Down

NEW YORK (AP) -- Major Internet stocks traded mixed Thursday, as shares of Yahoo Inc. declined after an analyst lowered his second-quarter earnings estimates for the company.

In afternoon trading on the Nasdaq Stock Market, Yahoo shares lost 63 cents to $27.68.

In a note early Thursday, William Blair & Co. analyst Troy Mastin said he was lowering his revenue estimate to $1.3 billion for the company's second quarter, and decreasing his earnings-per-share estimate to 11 cents from 12 cents. The changes are due to the company's "somewhat disappointing" first quarter results, which came out Tuesday.

The company's earnings for the quarter fell 11 percent year-over-year to $142.4 million, or 10 cents per share, from $159.9 million, or 11 cents per share.

more...
http://biz.yahoo.com/ap/070419/sector_snap_internet.html?.v=1

[citizen snips]

80. Soybeans Rise, Grains Mixed

CHICAGO (AP) -- Grains were mixed while soybean futures advanced Thursday on the Chicago Board of Trade.

Wheat for May delivery rose 21 1/2 cents to $4.96 a bushel; May corn rose 7 3/4 cents to $3.71 1/4 a bushel; May oats fell 1/4 cent to $2.68 a bushel; May soybeans rose 2 3/4 cents to $7.18 1/4 a bushel.

Beef futures decreased while pork futures advanced on the Chicago Mercantile Exchange.

June live cattle fell .10 cent to 92.72 cents a pound; May feeder cattle fell .23 cent to $1.0807 a pound; May lean hogs rose .87 cent to 76.67 cents a pound; May pork bellies rose 1.67 cent to $1.0487 a pound.

http://biz.yahoo.com/ap/070419/board_of_trade.html?.v=4

[citizen snips]

81. Sector Wrap: Coal Miners

NEW YORK (AP) -- Shares of coal mining companies slid Thursday after Peabody Energy Corp. reported its profit declined 32 percent for the first quarter, missing Wall Street expectations.

Peabody's net income fell to $88.5 million, or 33 cents per share. Revenue rose 4 percent, to $1.37 billion. Analysts polled by Thomson Financial expected earnings of 40 cents per share and $1.55 billion in sales.

Peabody stock gave up 43 cents to $45.78 on the New York Stock Exchange.

International Coal Group Inc. stock dropped 10 cents to $5.63 on the NYSE.

more...
http://biz.yahoo.com/ap/070419/coal_sector_wrap.html?.v=1

[citizen snips]

82. Sector Snap: Chinese Stocks

NEW YORK (AP) -- U.S.-listed shares of Chinese companies followed the Shanghai market lower Thursday, on renewed concern that Chinese officials may soon take steps to curb rising inflation.

China has been playing a growing role in the global economy. The country's first-quarter growth surged 11.1 percent, surpassing expectations, and raising concern that the economy might be overheating. Meanwhile, inflation rose 3.3 percent in China in March, the highest jump in more than two years, which led some economists to speculate that an interest rate hike might be looming.

Edmund Harriss, manager of the China and Hong Kong fund for Guinness Atkinson Asset Management, noted that China's inflation increase was mostly due to higher food prices. Harriss said a rate hike likely won't have as much of an impact as some fear.

"An interest rate rise is not going to have much of an impact on the real economy," Harriss said in an interview. "Levels of debt on the corporate side are not huge and interest rates are still pretty low, and the economy is still growing pretty fast. There's not going to be anything like the sort of tightening that could adequately deal with the excess liquidity they have in the system."

more...
http://biz.yahoo.com/ap/070419/chinese_companies_sector_snap.html?.v=2

[citizen snips]

83. Sector Snap: Newspaper Publishers Down

NEW YORK (AP) -- Newspaper publishers were down Thursday as four major publishers reported lower earnings for the first quarter.

New York Times Co., which publishes its namesake paper, The Boston Globe and the International Herald Tribune, said its net income fell 26 percent. Charges associated with the closing of its Edison, N.J., plant, staff reduction costs, and a tax adjustment weighed on earnings. Income from continuing operations dropped 34 percent.

New York Times shares fell 52 cents, or 2.1 percent, to $24.04 on the New York Stock Exchange in afternoon trading.

Tribune swung to a loss in the quarter, blaming a slide in classified advertising. The company, which accepted a buyout from real estate investor Sam Zell this month, owns 11 daily papers, 23 television stations and the Chicago Cubs baseball team.

more...
http://biz.yahoo.com/ap/070419/newspaper_publishers_sector_snap.html?.v=1

[citizen snips]

85. Sector Glance: Apparel Retailers

NEW YORK (AP) -- Apparel retailers' stock closed slightly lower on Thursday, despite the Conference Board's index of leading economic indicators showing an increase of 0.1 percent to 137.4 in March, as expected. The reading follows two straight months of declines, but the news did not buoy stocks.

Share movement was muted in much of the sector. Here is how some New York Stock Exchange-listed apparel retailers finished Wednesday:

Gap Stores Inc. shares fell 10 cents to $18.54,

AnnTaylor Stores Corp. shares slid 25 cents to $37.98,

more...
http://biz.yahoo.com/ap/070419/sector_glance_apparel_retailers.html?.v=1

[citizen snips]

86. Sector Glance: Telecom

NEW YORK (AP) -- Some telecom stocks inched higher Thursday, with MetroPCS Communications Inc. soaring on its first day as a publicly traded company.

MetroPCS, a Dallas-based wireless service provider, priced its initial public offering at $23, and investors snapped up its shares throughout the day, with trading volume climbing above 31 million.

Shares of rival Leap Wireless International Inc. also climbed in heavy trading.

Meanwhile Sprint Nextel Corp. saw its shares decline, and shares of embattled Internet phone company Vonage Holdings Corp. tumbled further.

more...
http://biz.yahoo.com/ap/070419/sector_glance_telecom.html?.v=1

[citizen snips]

87. Sector Glance: Grocers

NEW YORK (AP) -- Grocer stocks climbed Thursday after Supervalu Inc. reported a sharp rise in profit in its fourth quarter from its acquisition of grocery chain Albertson's in 2006. Supervalu, the country's third-largest supermarket chain, said its sales more than doubled for the quarter.

Here is how some key grocer stocks did on Thursday:

Kroger Co., up 68 cents at $30.08

Safeway Inc., up 65 cents at $37.34

more...
http://biz.yahoo.com/ap/070419/sector_glance_grocers.html?.v=1

[citizen snips]

88. Sector Glance: Big Stores

NEW YORK (AP) -- Shares in many of the nation's big-format stores, including department stores and discounters, were mainly flat on Thursday, as companies across the market reported mixed earnings reports but no major announcements occurred in the sector.

Here is how some key big-format stores fared Thursday:

Wal-Mart Stores Inc., up 37 cents to $48.34

Target Corp., up 45 cents to $61.26

more...
http://biz.yahoo.com/ap/070419/sector_glance_big_stores.html?.v=1

[citizen snips]

89. Sector Wrap: Copper Stocks Decline

NEW YORK (AP) -- Copper equities and futures suffered Thursday, mostly due to concerns about the possibility of looming interest rates hikes in China, which has been a source of high demand for the metal.

Chinese demand levels for copper are closely monitored. Analysts have said continued Chinese demand for the metal, which is used to make a variety of items, would likely buoy copper prices ahead.

But on Thursday, the Chinese market dropped sharply after data showed the booming economy grew a faster-than-expected 11.1 percent in the first-quarter, while inflation jumped 3.3 percent in March.

The news led to concerns that regulators might boost interest rates in an effort to curb the red-hot growth. Markets around the globe were pressured by the worries.

more...
http://biz.yahoo.com/ap/070419/copper_sector_wrap.html?.v=1

[citizen snips]

92. Nasdaq 100 Leaders & Laggards: CELG LOGI

NEW YORK (AP) -- Celgene Corp. helped lift the Nasdaq 100 to a slightly higher finish Thursday.\

The Nasdaq 100, which includes 100 of the largest nonfinancial securities traded on the Nasdaq Stock Market, added .08 to close at 1,832.47. The broader Nasdaq composite declined 5.15 to 2,505.35.

Celgene shares hit an all-time high of $60.59 during the session, and closed up $2.57, or 4.5 percent, at $60 in trading about twice daily average, posting their largest one-day gain in six months.

Linear Technology Corp. climbed $1.59, or 4.4 percent, to end at $37.63, after hitting an annual high of $37.69 during the session, its second day of gains after news of an accelerated $3 billion share buyback program. Linear also posted inline quarterly results.

more...
http://biz.yahoo.com/ap/070419/nasdaq_100_laggards.html?.v=1

[citizen snips]

93. DJIA Leaders & Laggards

NEW YORK (AP) -- An analyst upgrade on Intel Corp. lifted the world's largest chip maker to the largest gain on the Dow Jones industrial average Thursday.

The 30-stock index added 4.79 to 12,808.63

An FTN Midwest analyst upgraded the stock to "Buy" from "Neutral," lifting shares 46 cents, or 2.2 percent, to finish at $21.81 on the Nasdaq Stock Market.

Shares of diversified high-tech manufacturer Honeywell International Inc. rose ahead of the company's quarterly report on Friday, gaining 85 cents to finish at $49.06 on the New York Stock Exchange.

more...
http://biz.yahoo.com/ap/070419/djia_laggards.html?.v=1

[ozymandius]

94. day is done done

Dow 12,808.63 Up 4.79 (0.04%)
Nasdaq 2,505.35 Down 5.15 (0.21%)
S&P 500 1,470.73 Down 1.77 (0.12%)
10-Yr Bond 4.67% Up 0.016
NYSE Volume 2,969,766,000
Nasdaq Volume 2,157,968,000

4:20 pm : With conviction on the part of buyers lagging all day and the Dow closing in record territory a day earlier, it wasn't surprising to see the blue-chip index take a bit of a breather Thursday. Be that as it may, the blue-chip index still eked out enough of a gain to extend its winning streak to six and close at another new all-time high. The major averages finished mixed for a third straight session as the tech-heavy Nasdaq languished again as investors remained cautious ahead of more key earnings reports.

It is worth noting, though, that things could have been a lot worse, given the decidedly bearish tone coming into today's trading. Before the bell, the market had all of the makings for round two, albeit a much less dramatic sequel, of the Shanghai sell-off that triggered widespread panic on February 27. Higher than expected GDP and CPI reports from China initially renewed concerns about the Chinese government stepping up its efforts to curb speculative buying interest with a possible rate hike.

The news roiled overseas markets as Japan's Nikkei 225 fell 1.7%, Hong Kong's Hang Seng Index plunged 2.3% and the once unknown Shanghai stock exchange tumbled 4.5%. Fortunately for the bulls, fears of a possible unwinding in the yen carry trade and resurgence in risk aversion, similar to that exhibited throughout the month of March in the aftermath of the Asian contagion, continued to subside as the day wore on. The European bourses as well as the major U.S. averages posted only fractional declines.

From a leadership standpoint, six of 10 sectors posted losses. Energy (-1.0%) paced the way lower as a 2.1% drop in oil prices diminished the desire to own the likes of explorers and refiners. Crude for May delivery, which expires tomorrow, closed near $61.80/bbl following reports that Enbridge resumed shipments through a previously shutdown pipeline from Canada, last year's biggest source of U.S. crude-oil imports.

Evidently lower oil prices did little to excite consumers as the Discretionary turned in the day's second worst performance. Everything from retailers to autos to cable companies were weak, but hotels were the sector's biggest disappointment after Marriott International (MAR 48.12 -3.75) issued disappointing RevPAR guidance.

With Google's (GOOG 471.27 -4.74) earnings out after the close, and rival Yahoo! (YHOO 27.50 -0.80) shocking Wall Street yesterday with its disappointing Q1 report, Technology was in focus again Thursday. Yahoo! tacked a nearly 3% decline onto yesterday's 11% drubbing while eBay (EBAY 33.16 -1.29) also weighed heavily on the Internet Services group. A suggested holding in the Briefing.com Active Portfolio, eBay posted a 52% rise in Q1 profits and raised its full-year earnings and revenue forecasts; but with expectations running high ahead of its report last night, investors were tempted to lock in some of its 15% year-to-date advance. One bright spot for tech was Intel (INTC 21.81 +0.46), another suggested holding which surged 2.2% after being upgraded. Intel was an integral reason the Dow hit a new record again and why the tech sector's decline was minimal.

On the positive side of things, Health Care was the day's standout, with the bulk of sector support coming from Biotech (+3.4%), today's best performing S&P industry group. Amgen (AMGN 62.32 +2.31) staged a relief rally following upbeat results from a study regarding its blockbuster Aranesp drug while investors also applauded an upbeat Q1 report from Gilead Sciences (GILD 81.67 +3.24). BTK +0.7% DJ30 +4.79 DJTA +0.7% DJUA -0.4% DOT -0.6% NASDAQ -5.15 R2K -0.8% SOX +0.5% SP400 -0.4% SP500 -1.77 XOI -0.8% NASDAQ Dec/Adv/Vol 1988/1023/2.04 bln NYSE Dec/Adv/Vol 2122/1117/1.48 bln

[Roland99]

95. Dec DOUBLE the Adv. Great sign.

:eyes: