STOCK MARKET WATCH, Wednesday 17 March

[ozymandius]

Wednesday March 17, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 312
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 96 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 149 DAYS
WHERE ARE SADDAM'S WMD? - DAY 360
DAYS SINCE ENRON COLLAPSE = 844
Number of Enron Execs in handcuffs = 18
Recent Acquisitions: Skilling
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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




AT THE CLOSING BELL ON March 16, 2004

Dow... 10,184.67 +81.78 (+0.81%)
Nasdaq... 1,943.09 +3.89 (+0.20%)
S&P 500... 1,110.70 +6.21 (+0.56%)
10-Yr Bond... 3.69% -0.08 (-2.12%)
Gold future... 402.60 +3.00 (+0.75%)

DOW..........................NASDAQ.......................S&P

||


GOLD, EURO, YEN and Dollars


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

[ozymandius]

1. Remember: It's a job-loss recovery.

U.S. Factory Shipped To China

Eight months after a factory that makes television screens shut down, an invasion of sorts has landed in Pennsylvania.

Scavenger crews are now dismantling the plant for a Chinese company that's bought the equipment and plans to put it to work on its own soil, reports CBS News Correspondent Jim Acosta.

"Our competition is overseas and people in the United States are losing out," said former factory worker Ron Welch.

<cut>
"It's hard to watch our jobs going down the road in tractor trailers," said Scott Conway, another laid-off worker.

Bank of America Plans Job Cuts of Up to 13,000

NEW YORK -- Bank of America Corp. (BAC, news) is planning to cut as many as 13,000 jobs as it completes its acquisition of FleetBoston Financial Corp. (FBF, news), people familiar with the expense cuts told The Wall Street Journal.

The job cuts would come through layoffs and attrition from the operations of both banks and will begin in April to coincide with the expected completion of Bank of America's $48 billion purchase of Fleet, according to these people. The job cuts, which range from 12,000 to 13,000, amount to about 7% of Bank of America and Fleet's combined work force of 181,000.

[UpInArms]

8. the mal-administration's policies and its henchmen

are responsible for this atrocity:

http://asia.news.yahoo.com/040309/afp/040309153513eco.html

Fed approves Bank of America, FleetBoston merger

WASHINGTON (AFP) - The Federal Reserve has approved the merger of FleetBoston Financial and Bank of America, creating the second largest commercial bank in the nation with combined assets of 938 billion dollars.

The Fed made the announcement late Monday.

The new entity, to be known as Bank of America Corp., would combine FleetBoston's 201.5 billion dollars in assets and pre-merger Bank of America's 736.5 billion in assets and control roughly 9.6 percent of total insured banking assets in the United States.

...more...

Mr. Meanspin should be looking in the mirror when he thinks about the US job market.

:nuke:

[tlcandie]

9. He doesn't care like the others because they have a job and a

nice cushion to retire upon whenever and wherever they want with no worries!! As long as the smoke and mirrors can continue while they all get rich that is all they care about!

[UpInArms]

19. here are some additional details

http://www.washingtonpost.com/wp-dyn/articles/A64913-2004Mar16.html

Yes, this is the same Bank of America that agreed this week to pay $375 million, and reduce fees by $80 million, to settle civil charges that it defrauded mutual fund investors by helping a big hedge fund engage in illegal trading.

It is the same Bank of America that last week agreed to pay a $10 million fine for withholding and destroying documents requested by the Securities and Exchange Commission. That's in connection with an ongoing investigation into whether B of A's securities unit engaged in illegal trading based on inside information about its upcoming analysts reports.

It's the same Bank of America that helped Enron structure one of its infamous off- balance-sheet entities, then helped beat back an accounting reform that would have forced disclosure of such scams.

The same Bank of America that was so proud of the one-stop service it provided to Adelphia Communications -- loans, securities underwriting, strategic advice and positive analyst reports -- that it actually detailed it in a case study it used with its new employees.

The same Bank of America that helped dairy giant Parmalat place more than $1 billion in public and private debt, and now has three former employees under investigation by Italian authorities.

http://www.cbsnews.com/stories/2004/03/17/national/main606807.shtml

The central bank's approval removed the last major regulatory hurdle for the combination, which already had been blessed by the Justice Department and the Federal Trade Commission. The merger also must be approved by shareholders of both banks, allowing it to be completed early next month. Both banks have scheduled special shareholders meetings for March 17 for the votes.

At public hearings held by the Fed in January in Boston and San Francisco, witnesses expressed concerns about predatory lending, possible closing of rural bank branches and the trend toward big banks getting bigger.

and from the WashPost article:

Confronted with this embarrassing rap sheet, and a requirement that it consider the bank's compliance history and management competence, the Fed's opinion approving the FleetBoston purchase is a model of sophistry. Rather than focus on the past, the Fed's six governors lavish praise on Bank of America for cooperating with investigators and taking steps to make sure it doesn't happen again.

[54anickel]

21. So what's in it for the Fed, hmmm?

[54anickel]

23. China's own Silicon Valley is emerging. (5000 multinationals!)

http://www.miami.com/mld/miamiherald/business/national/8193401.htm

Mar. 15--SHANGHAI, China - In the heart of a bustling free-trade zone in Shanghai, a $500 million Intel plant readies the flagship Pentium 4 chips that run the latest generation of computers. Hundreds of Chinese workers in lab coats monitor diamond-tipped wafer saws and other automated equipment, testing and assembling chips for the world market.

Intel's plant is the largest investment in the zone, a former patch of farmland where more than 5,000 multinationals have set up shop.

snip>
SMIC and other Chinese ventures in this park are striving to someday challenge U.S. companies as tech leaders of the future.

These two zones show both the promise and the challenge that China represents for Silicon Valley. U.S. tech companies are rapidly expanding their partnerships with China. They are eyeing the nation's huge domestic market and tapping its cheap labor for skilled manufacturing, and increasingly, the brainpower for creating tech innovations. At the same time, the American tech companies are looking warily at an emerging rival.

People in China "are capable of doing any engineering job, any software job, any managerial job that people in the United States are capable of doing," said Craig Barrett, Intel's chief executive officer, in an interview in Beijing.

Intel, with 2,400 employees throughout China, will have invested more than $1 billion by the end of next year into the world's most populous country, making memory chips and microprocessors and hiring top Chinese engineers for development work.

But Barrett remains ambivalent about the long-term implications of China's development.

"As CEO of Intel, my allegiance is to the shareholders of Intel and to the success of the company," he said. "We go after the most cost-effective resources around the world, no matter where they are." However, "as an American citizen, I would have to be worried about whether jobs that are created are created outside the U.S. . . . As a citizen, I see all these resources and I think this puts my country in danger," he said.

more...

[UpInArms]

2. daily dollar watch

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

Last trade 88.58 Change -0.01 (-0.01%)

related articles:

February Sentiment Index Was Accessed Early

http://www.thestreet.com/markets/matthewgoldstein/10149062.html

The University of Michigan's Feb. 13 consumer sentiment index -- a widely followed economic barometer whose release often creates big swings in the stock market -- reached unspecified recipients prematurely, the school said Tuesday. Diane Swanbrow, a spokeswoman for Michigan's Institute for Social Research, which compiles the consumer sentiment report, says the investigation is being conducted in conjunction with law enforcement agencies. The university said it was unable to comment "beyond noting that a full review of all security measures has been initiated. New security measures have been implemented, and the last two releases have remained secure." The probe is focusing on the early release of information from the school's Feb. 13 consumer sentiment report, which showed an unexpected drop in consumer confidence. The S&P 500 closed at 1146 on Feb. 13, down from 1152 the day before. "What happened is very troubling to us, and we want to assure the public and research sponsors that we regard the security and confidentiality of U-M research data as matters of the utmost seriousness," Fawwaz Ulaby, Michigan's vice president for research, said in a statement released by the university.

well that one wasn't really related to the dollar - but....

http://www.reuters.com/financeNewsArticle.jhtml?type=economicNews&storyID=4581018§ion=investing

RPT-UPDATE 1-Currency intervention only works short-term--Kuroda

WASHINGTON, March 16 (Reuters) - Foreign exchange intervention can be a useful short-term policy tool but cannot truly manipulate the world's three major currencies because of vast global capital flows, Japan's top financial diplomat said on Tuesday.

Haruhiko Kuroda, special adviser to Japan's Prime Minister Junichiro Koizumi, told a Washington forum on the economic relationship between America and Asia that Japan was addressing specific domestic policy concerns through its currency interventions.

"We are still in a deflationary situation. Prices are still declining ... We are really concerned about the price implications of the yen appreciation at this stage and in order to avoid excessive appreciation, we have been intervening," Kuroda said.

A report in the Nihon Keizai Shimbun financial daily published during New York trading hours on Monday said the Bank of Japan was eyeing an exit strategy for its yen-weakening moves in currency markets. But officials sought on Tuesday to dampen such speculation.

Finance Minister Sadakazu Tanigaki told reporters earlier on Tuesday there was no change in Japan's basic stance on foreign exchange.

"With the three major currencies (dollar, yen and euro) ... they are almost impossible to control or target," Kuroda said in the Washington panel discussion on currencies.

"From time to time, foreign exchange market intervention can be effective, particularly when authorities express some serious signal to the market when there may have been some misunderstanding of the intention of the authorities. The other (occasion) is if the intervention is not sterilized. That would tend to have more impact on the foreign exchange rate and the economy," Kuroda said.

...more...

http://www.nytimes.com/2004/03/17/business/worldbusiness/17yen.html

Tokyo Officials Struggle to Hold the Yen in Line

TOKYO, March 16 - Japanese financial authorities are waging a battle against what they see as one of the biggest threats to the nation's economic recovery - a rising yen. And while the effort seems to be working so far, analysts and investors are questioning how long they can keep it up.

After a year of steady gains against the dollar, the yen weakened to a five-month low, around 112 yen, this month from about 106 yen in early February. The change in direction for the Japanese currency was a relief to the country's exporters whose profits are crimped by too much yen strength.

But the cost was steep: Tokyo spent record amounts to hold its currency back by selling yen and buying dollars. Japan sold 10.5 trillion yen ($95.2 billion) in the two months ended Feb. 26, already more than half last year's 20 trillion yen, a record. Through such transactions, Japan has accumulated the largest foreign-currency reserves in the world, at $777 billion, much of it invested in United States government debt. Japanese investors accounted for about half the purchases of United States Treasury securities last year.

Despite the heavy intervention, the Japanese currency is again inching up on the dollar, rising to around 109 yen on Tuesday from around 111 on Friday, amid speculation in foreign exchange markets that Japan will not be able to maintain the immense yen sales for long.

<snip>

The yen strengthened nonetheless to 108.9 yen Tuesday after a report in The Nikkei Financial Daily that the government would probably scale back yen sales after the end of Japan's fiscal year on March 31.

A rise in the yen before the end of the fiscal year would reduce profits for the export companies that have been leading Japan's economic recovery by reducing the value of their overseas earnings. Although there are signs that Japan's economy is gaining strength, two fledgling recoveries have died in the last decade, and policy makers want to make sure that does not occur again.

...more...

Good Morning Ozy and all the Marketeers! :hi:

The futures look bright and shiny! Did you see that trumped up Manpower (temporary worker) report that the news was praising last night? 72% of employers are not planning to hire but that was good news! So when is it good news that only 28% plan to hire one or two temporary workers? Funny that they try to spin a *Co supporter report into a huge puffpiece story - NOT! Well, guess they will need to work harder at creating an atmosphere conducive to hiring since Bank of America (that M&A with FleetBoston) is going to cost the country 13,000 jobs.

I hope the voters of this country slap this rotten administration's ass out of office just like Spain did to that fascist Aznar.

Have a Great Day at the Casinos!

(edited becuz I can't add or subtract)

[ozymandius]

3. WrapUp by Scott Middleton

Business as Usual

The Fed ruled the day’s trading as they held a policy-setting committee meeting today. Volumes in the indexes were very light as most traders sat on the sideline waiting to see what it was the Fed would say this time. The central bank statement, once released, reiterated the need for an “accommodative” monetary policy, and also preserved its wording about the inflation outlook, saying the risks of deflation and rising prices as almost equal.

After the statement was released, equity markets briefly surged and then quickly slid into negative territory, finally making a comeback in late trading, most likely a boost from some “unknown, large buyer.”

Economy

Today’s economic data revealed construction of new U.S. houses slowed about 4 percent in February. The figure represents the slowest pace of building since August. Many economists blamed the slowdown of recent bad weather throughout the country and went on record as seeing this slowdown as expected and had little concern for it. However, at the same time, an indication of future construction, building permit requests were also down during the last reporting period. It’s a good thing the Fed continues to hold its accommodative stance.

more...

[ozymandius]

4. Nolte Notes - The Ides of March

Beware the Ides of March. This warning may bring added significance this year, as it marks the anniversary of the beginning of this bull phase and the anniversary of the top of the market in ’00, and maybe the end of the current run. While everyone was looking for reasons for the decline (from the poor employment report of the prior week to the Madrid bombing), the OTC market may have presaged the decline with its poor technical condition for much of this year. The economic numbers still point to an expanding economy, the major unknown is whether economic growth will be sufficient to boost earnings enough to justify current earnings multiples. Also, will the projected economic growth be enough to expand the workforce. What is known is that this expansion is the slowest in the post WWII period. We have been concerned whether deterioration in the OTC market would spill over to the remaining equity markets – we got our answer this week in the affirmative. The highlight of the week may be the Fed Open Market Committee meeting, where they should leave rates alone. However, those good at reading between the lines will have a field day analyzing the press release containing their views on the economy.

<cut>
While there were but a few places to hide last week (only 4% of the groups were positive), the same themes we have been highlighting continue to develop. Technology continues to lead the market lower, with the sector underperforming the SP500 every week since 1/19/04. Also in the lousy camp are the basic material stocks, companies with the economic building blocks. There has been a rotation to the safe and relatively secure of consumer stocks (witness Proctor & Gamble) and utilities (outperforming for the past four weeks). Just as a rising market lifts all boats, a falling one sinks ‘em all. The basic material underperformance has come about as investors rethink the thesis of strong economic growth. Copper, aluminum, gold and steel have doubled in six months, tripled in twelve anticipating a brisk economy that may not materialize. Technology stocks, by virtue of their massive decline were certainly due to bounce, but those that bounced the highest were the weakest financially. The sector work continues to show deterioration across the basic materials and technology areas, while the consumer and utility sectors enjoy a bit of the limelight. One area that historically has benefited from a move to safety has been the healthcare stocks. While the specialty products and devices have done fairly well, the drug sector has performed poorly. Many in the group look to have rallied to their long-term downtrend lines and only recently turned lower. This could mean another trip, yet again, to the bottom of the heap before any lasting rally might occur. Included in the reversals are Pfizer, Merck, J&J, Bristol Myers and Wyeth Labs. The only saving grace for the group are the smaller cap issues that have held up a bit better, but are overwhelmed by their outsized brethren.

http://www.financialsense.com/editorials/nolte/2004/0315.html

[UpInArms]

5. U.S. Feb. CPI up 0.3% as expected

http://cbs.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38063.3543865741-813014402&siteID=mktw&scid=0&doctype=806&

WASHINGTON (CBS.MW) - U.S. consumer prices rose 0.3 percent in February as energy prices continued to climb, the Labor Department said Wednesday. Energy prices increased 1.7 percent. The core CPI, which excludes food and energy costs, rose 0.2 percent for the second straight month. Economists were expecting the CPI to rise 0.3 percent and the core to rise 0.1 percent. Core goods prices increased 0.2 percent in February, the first increase in 18 months. Medical costs increased 0.6 percent in February, the largest gain since October 2002. Housing costs rose a moderate 0.2 percent. Food prices increased 0.2 percent. Apparel prices fell 0.1 percent. Education and communication prices rose 0.3 percent.

Well, isn't that just ducky! If you don't eat or heat your house, you have nothing to fear!!!

:puke:

I am sick and tired of the spin on this and I am damn angry that the PPI numbers are being manipulated and held back :mad:

[ClintonTyree]

12. I'm willing to bet..............

that those energy cost numbers have been manipulated somewhat as well. I know energy costs around here (Central Florida) have risen FAR more than 1.7% in the past month.
If the truth ever got out about these CPI numbers and people had a real look at what the hell is going on, I believe widespread panic would ensue. Obviously this is why these numbers are massaged every month, but sooner or later it's going to catch up with them. You can't keep sweeping stuff under the rug and sooner or later people are going to realize that there's one hell of a lump of shit under that rug.

[UpInArms]

16. the lump

is in the shape of this

[CaptainClark23]

17. See post in Econ board re: leak of Michigan Report

scary shitte

[Coventina]

6. The "I Ching" on today's market

Hello everyone!

Things have been pretty crazy around here! I still read the thread every day, even when I don't get a chance to participate.

Today's reading is NOURISHING changing to BENEFIT. Here is the changing line from Nourishing: "ALthough you are aware of the need to nourish and affect others, you lack sufficient strength to do it so unaided. Rely on a strong superior to accomplish the deed. Don't try it on your own."

Here is a quote from Benefit: "Those engaged in business or political affairs can Benefit their own aims, provided their goals are worthy. The time is ideal for offering especially generous services to others. This will open the way to greater areas of potential development."

The message seems pretty consistent. It seems to me that Ching is saying that prosperity will only come if it comes for ALL.

[ozymandius]

7. Refinancing demand soars 40%

NEW YORK (Reuters) - U.S. mortgage applications jumped last week on a surge in refinancing activity, as mortgage rates hovered near last summer's record lows, an industry trade group said Wednesday.

The Mortgage Bankers Association said its seasonally adjusted market index, a measure of weekly mortgage activity, jumped for the week ended March 12 by 25.6 percent to 1,117.1 from the previous week's 889.1,

<cut>
Mortgage rates fell sharply in early March as a report of surprisingly weak U.S. job growth in February fanned hopes that the Federal Reserve would leave short-term rates unchanged throughout the year, and perhaps until 2005. On Tuesday, Fed policymakers decided to leave short-term rates unchanged.

http://money.cnn.com/2004/03/17/news/economy/mortgage_apps.reut/index.htm

[ozymandius]

10. Casino's open

9:31
Dow 10,202.23 +17.56 (+0.17%)
Nasdaq 1,957.61 +14.52 (+0.75%)
S&P 500 1,112.97 +2.27 (+0.20%)
10-Yr Bond 3.658% -0.030

[UpInArms]

13. and climbing at 9:47 EST

Dow 10,245.93 +61.26 (+0.60%)
Nasdaq 1,966.55 +23.46 (+1.21%)
S&P 500 1,118.74 +8.04 (+0.72%)
10-Yr Bond 3.657% -0.031

[54anickel]

11. France weighs sale of gold to fund research

http://www.busrep.co.za/index.php?fSectionId=&fArticleId=375881

Paris - Taking its cue from Germany, the French government is looking at the pots of gold sitting in central bank vaults as a possible means to finance research, despite the likelihood of stiff political and legal opposition.

The need to invest in research to remain competitive internationally has pushed first the German government and now the French one to consider selling central bank reserves to generate funds for projects.

The Bank of France has 3 000 tons of the precious metal in the form of ingots worth more than €30 billion (R245 billion).

"These gold reserves are managed by the Bank of France but they belong to the nation," a French ministerial source said.

snip>
But the German Bundesbank, which openly wants to sell gold in order to diversify its holdings, has suggested that some of the gains from selling bullion reserves could be reinvested in a national foundation to support research and education.

The idea was rejected by all German political parties, which want to use potential proceeds from a gold sale for the reduction of the national public debt.

In France, the central bank has signalled its opposition to selling gold for research spending. A high-ranking official at the Bank of France was quoted by the French business newspaper Les Echos as describing the idea as "crazy".

more...

[CaptainClark23]

14. Central Banks:

Mon Dieu!

Its OUR Gold, dammit! We're not letting go of it! Cause we know when the shit hits the fan, that gold is going to be the only thing between us and the mobs with pitchforks and torches!

So we know the banks don't want to start releasing gold reserves for consumption (maybe because they too have overstated, and oversold on shorts?). Do they really have all the physical gold they are supposed to have in possession?

Seriously though...whats the deal with Germany and France wanting to start dipping into the gold reserves? Anyone?

If they do so, even on the limited levels proposed, what will be the ramifications for the Gold market in general?

hmmm...that Agreement (name escapes me at moment) concerning gold limits expires very soon, doesn't it? Is this related?

50/50 4anickel, help me out here! Moments like these, I consider dropping my next round of PM money on a membership to lemetropole.

[54anickel]

18. Morning Captain.

The agreement is the Washington Agreement. They just renewed it a couple of weeks ago and raised the limit sold by a mere 500 tonnes. You will note that the US is not a signer of that agreement (who knows if they even have any gold left - but that's for another tinfoil hat discussion).
I've touched on this before, there are 2 thesis floating around for wanting to sell their gold reserves.
1) Just as Germany claims diversification of assets held.
2) (The tinfoil one) is that they leased to much gold out and want to straighten out the books, booking sales of gold that is no longer there anyway.

The reported effect on the gold market is that it would stabilize prices a bit. Knowing and limiting how much gold could come on the market would prevent a big unknown dump of gold, negatively effecting the price.

Google the news for "washington agreement" gold. Here's on article, there are many.

http://finance.news.com.au/common/story_page/0,4057,8912870%255E14305,00.html

[54anickel]

40. New article, hot off the press on the WA agreement.

Probably more in line with the type of news you'd get from lemetropole.

http://www.gold-eagle.com/editorials_04/turk031804.html

8 Reasons to Ignore the New Central Bank Gold Agreement

On March 8th the European Central Bank and 14 of Europe's national central banks made the following announcement: www.ecb.int/press/04/pr040308.htm

"In the interest of clarifying their intentions with respect to their gold holdings, the undersigned institutions make the following statement:

Gold will remain an important element of global monetary reserves.
The gold sales already decided and to be decided by the undersigned institutions will be achieved through a concerted programme of sales over a period of five years, starting on 27 September 2004, just after the end of the previous agreement. Annual sales will not exceed 500 tonnes and total sales over this period will not exceed 2,500 tonnes.
Over this period, the signatories to this agreement have agreed that the total amount of their gold leasings and the total amount of their use of gold futures and options will not exceed the amounts prevailing at the date of the signature of the previous agreement.
This agreement will be reviewed after five years."
This statement contains only 147 words, and it appears simple and straightforward enough on the surface. The central banks even tell us the reason for their statement - to 'clarify their intentions'. Wow, aren't they swell guys. But don't be deceived. Central banks deserve our scorn, and for that matter, our enmity too for the interventionist, statist policies that they inflict upon us in order to sustain the fiat currency that they create, which the politicians then debase to our detriment.

To truly understand the significance of any central bank pronouncement, one has to read between the lines. Here's how I read their statement:

more...

[54anickel]

15. East Asia needs an effective exchange rate cooperation mechanism

http://www.channelnewsasia.com/stories/afp_asiapacific_business/view/75799/1/.html

WASHINGTON: Powered by 60 percent of the world's foreign exchange reserves, East Asia should have an effective mechanism for exchange rate cooperation that can resist US pressure on currency and trade policy, experts said.

Finance ministers of East Asian economies Japan, China, South Korea and the 10 members of the Association of Southeast Asian Nations (ASEAN) have just started to discuss exchange rate issues.

But the "ASEAN plus three" meeting has not graduated to exchange rate cooperation, like the forum of the Group of Seven finance ministers and central bank governors.

Speaking at a conference in Washington on the future of economic relations between the United States and East Asia, a special adviser to the Japanese cabinet proposed that the East Asian countries "considerably strengthen" the meeting among their finance ministers "as a body for exchange rate cooperation by including central bank governors."

snip>
Kuroda said that if ASEAN countries wanted a "stable exchange rate relationship" by pegging their currencies to a common currency basket -- a long term aim of the 10-member group, "then the ASEAN plus three can become the G4 (Japan, China, South Korea and ASEAN) and facilitate far more effective cooperation in the region."

But he said any exchange rate cooperation as broad as that among the United States, Japan and East Asia would not be easy.

snip>
"China is now the lightning rod for protectionism in the United States that Japan represented a decade ago," he said. "Korea may not completely escape being targeted either."

Malaysia, which moved to peg its ringgit currency against the US dollar against the wishes of the International Monetary Fund (IMF), is also under pressure from many groups to refloat its currency.

Henning said as Washington continued to press, East Asians would have an "incentive to put aside and reconcile (not dismiss) their considerable differences and reach a modus vivendi on financial questions of common interest.

more...

[54anickel]

20. Big, sudden moves showing up in the PM 1 day spot charts at INO again.

[54anickel]

22. Trade zone talks in the news.

Egypt and Israel Discuss Industrial Trade Zone

http://www.nytimes.com/2004/03/17/business/worldbusiness/17egypt.html?ex=1080190800&en=9bc04b5abd7d3eb1&ei=5062&partner=GOOGLE

CAIRO, March 16 - Nearly a decade after an agreement first allowed for joint industrial areas where Egyptian goods with Israeli content can gain tariff-free access to the United States, Egypt and Israel finally seem to be seriously considering the creation of so-called Qualifying Industrial Zones.

The zones, if formed, are expected to attract millions of dollars in foreign investment and employ thousands of Egyptian workers.

snip>
Though the Israelis confirmed the talks, Egyptian delegation members and Ministry of Foreign Trade officials all rejected or ignored repeated requests for comment.

The skittishness reflects just how sensitive the issue is in Egypt. Dealing with Israel comes at a very high political price, and the public and the press, largely hostile to Israeli policies in the occupied territories, have lashed out at both the Egyptian government and businessmen said to have been part of the trade delegation to Israel

snip>
There would be a benefit for Israel, too. The Q.I.Z. legislation, a 1996 Clinton administration initiative, basically extends to peace partners of Israel the preferential access to the United States market that Israel gained under the 1985 American-Israeli free trade agreement. It aimed to reward peace efforts in the Middle East and to encourage Arabs and Israelis to create a base of businesses joined by common interests to spur further development.

Under the initiative, at least 11.7 percent of the value added to any goods produced in a qualifying zone must come from Israel.

"You have to import from Israel in order to qualify," said Fahd al-Fanek, an economist in Jordan, a country also included in the legislation. (The Palestinian Authority was the other entity included.) "If you make bags, for example, the handles must come from Israel not because they are the best or cheapest, but because these are the rules."

For Israeli businessmen, labor in Egypt and Jordan is cheap, an average of $100 a month, compared with $700 a month in Israel.

snip>
Egypt, however, evaded closer economic ties with Israel as it sought a full free trade agreement with the United States. But during the World Economic Forum meeting in Amman in June, the United States trade representative, Robert B. Zoellick, harshly criticized Egyptian economic policies and ruled out such an agreement.

more...


Sarakhs open to investors from Islamic world

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=23524&NewsKind=Business%20%26%20Economy

Tehran, March 16 (IRAN NEWS) -- The Sarakhs Special Economic Zone, in northeastern Khorassan province, near the Turkmenistan border, is ready to provide services and necessary facilities to businessmen and entrepreneurs from Islamic countries.

The Managing Director of the Sarakhs zone, Abdullah Paykubi, said that last September in the meeting of chambers of commerce of Islamic countries, Iran announced that the Sarakhs economic region is ready to provide trade services, concerning the activities of the "Islamic joint market".

But no substantial trade and investment activities from Islamic countries with central Asia via the Sarakhs Special Economic Zone has yet to be detected. Sarakhs, close to the Central Asian market, is the best transit route to the CIS as well as to the Persian Gulf, the Middle East as well as Europe.


Conservatives to stop new Free Trade Zones

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=23525&NewsKind=Business%20%26%20Economy

Tehran, March 16 (IRAN NEWS) -- The conservative victory in the parliamentary elections may curtail or even halt the establishment of new special and free trade zones.

"Issuing new permits for free trade zones should be stopped. However, existing zones can continue as before, considering their ability to attract investment" a newly elected MP and economic analyst, Mohammad Khosh-Chehreh said. His viewpoints appear to be popular with the incoming conservative-dominated parliament toward changing the structure of free trade zones. However, the number of requests for creation of such zones have considerably increased.

Also, economic institutions as well as governors of different provinces have been making every effort to obtain permits for establishing special and free trade zones before the term of the Sixth Majlis runs out. According to Iranian law, the parliament and the cabinet are in charge of issuing permits for free trade and special economic zones respectively.

[54anickel]

24. 11:05 numbers and blather

Dow 10,265.11 +80.44 (+0.79%)
Nasdaq 1,967.66 +24.57 (+1.26%)
S&P 500 1,119.59 +8.89 (+0.80%)
30-yr Bond 4.626% -0.021

NYSE Volume 466,168,000
Nasdaq Volume 559,357,000


11:00AM: The market is trending sideways near its best levels of the session, with the Nasdaq continuing to outperform the Dow and the S&P 500 on a relative basis... The broker/dealer sector is worth a mention in view of Bear Stearns' (BSC 86.44 -1.56) results this morning... While these may not have been entirely surprising on the heels of solid results by Lehman Brothers (LEH 84.53 -0.51) in yesterday's session, the company's reported Q1 EPS of $2.57, $0.54 above the consensus, are still impressive... Nevertheless, the stock is experiencing a sell-the-news reaction...
Briefing.com, for its part, expects brokers to continue performing nicely in the current macro environment, as described in this morning's Earnings Briefing...NYSE Adv/Dec 2310/704, Nasdaq Adv/Dec 2087/717

[ozymandius]

25. bumbers, blather and goodbye

11:08
Dow 10,272.08 +87.41 (+0.86%)
Nasdaq 1,969.25 +26.16 (+1.35%)
S&P 500 1,120.23 +9.53 (+0.86%)
10-Yr Bond 3.672% -0.016

U.S. stocks surge on mild inflation, positive earnings

NEW YORK (CBS.MW) - U.S. stocks got a nice lift in early action Wednesday with broad buying following welcome news that inflation remained relatively tame in February.

Earnings reports were also mostly positive as FedEx topped Wall Street's views by a penny, and Bear Stearns reported across the board strength as it trounced analysts' expectations.

Economic data

U.S. consumer prices rose 0.3 percent in February as energy prices continued to climb, the Labor Department said Wednesday. Energy prices increased 1.7 percent. The core CPI, which excludes food and energy costs, rose 0.2 percent for the second straight month.

Economists were expecting the CPI to rise 0.3 percent and the core to rise 0.1 percent. Core goods prices increased 0.2 percent in February, the first increase in 18 months. Medical costs increased 0.6 percent in February, the largest gain since October 2002. Housing costs rose a moderate 0.2 percent. Food prices increased 0.2 percent. Apparel prices fell 0.1 percent. Education and communication prices rose 0.3 percent.

story

I must run folks. There's more work for me to do if I am to find a job in the near future. I'll see you all in the morning. Have a grwat day!

Ozy :hi:

[54anickel]

26. See you tomorrow Ozy - Good luck on that job search!

[UpInArms]

27. bye Ozy!

:hi:

Good luck in your job search :thumbsup:

[UpInArms]

28. market numbers and blather at 11:44 EST

Dow 10,291.34 +106.67 (+1.05%)
Nasdaq 1,973.43 +30.34 (+1.56%)
S&P 500 1,122.88 +12.18 (+1.10%)
10-Yr Bond 3.681% -0.007

11:30AM: Buyers remain in control of the session, driving the major averages to new session highs... As a result, the blue-chip averages are up 1.1%, while the Nasdaq has surged 1.5% higher... The housing sector has many a reason to be rallying today, although it's only marginally higher given its 7% advance year-to-date... Specifically, Lennar (LEN 53.96 -2.05) reported better than expected earnings this morning and guided higher (see Story Stock for more details), while KB Home (KBH 78.90 -0.35) beat the consensus estimate by a whopping $0.16 with its EPS of $1.75 reported last night...

Separately, the Mortgage Bankers Association index of mortgage applications popped by 25.6% last week, hitting 1117.1, the highest total since mid-July... NYSE Adv/Dec 2326/ 747, Nasdaq Adv/Dec 2132/745

[Robbien]

29. US Labor Dept says to release Jan PPI on March 18

WASHINGTON, March 17 (Reuters) - The U.S. Labor Department said on Wednesday it will release its delayed Producer Price Index data for January on Thursday at 0830 EST (1330 GMT), but had not scheduled a date for the February data, also delayed.

The Jan. PPI was originally scheduled for release on Feb. 19 but was postponed when the department's Bureau of Labor Statistics ran into trouble converting the data to a new industrial classification system. BLS was also forced to postpone the Feb. data which had been scheduled for release on March 12.

BLS said it would provide at least a day's notice when a new release date is set for the Feb. PPI and would post the notice on its Web site http://stats.bls.gov/ppi/delaynotice.htm.

This is going to be interesting.

[UpInArms]

31. thanks the heads-up on the report Robbien!

we will all be waiting for this one with bated breath - these numbers should be very interesting.

[54anickel]

36. The day before the Witching thingy? GACK!

http://money.cnn.com/2004/03/16/markets/markets_newyork/

snip>
"We're at a very critical juncture here," he added. "We're right at support levels that we must hold, and at the same time we have critical events taking place at the end of the week, namely the options expirations."

Friday is a quadruple expiration day, the last trading day before stock index futures and options, as well as individual stock futures and options, all expire simultaneously. The sessions leading up to this 'quadruple witching' tend to be volatile.

Tuesday's volatility was likely tied to professional traders and managers positioning themselves for the expiration, as well as the fact that volume is quite low, Mendelsohn said.

Trading for the next few sessions is bound to remain volatile. Wednesday's only economic data is the consumer prices report for February, expected to show little change, as inflation remains a distant concern.

[mbperrin]

43. I'm sure they took lumber out of the PPI.

In December a 4x8 sheet of 7/16 OSB was $8; now, three months later, it's $20! Sheetrock moved from $3 to near $5; framing studs moved from $2 to near $4.

Oh, yeah, gotta get the lumber outta those numbers!

Any takers?

[54anickel]

30. China's appetite boosting prices

Does this mean future inflation, pricing pressure on manufacturers that cannot push higher cost on to consumers, lower profits, something else? What will China do will all this "stuff" if the rest of the world can no longer consume? World wide inflation or deflation?

I have no idea what this ever increasing imbalance of supply/demand will do?

http://www.taipeitimes.com/News/worldbiz/archives/2004/03/15/2003102585

The sizzling Chinese economy is sucking in ever greater levels of raw materials, driving commodity prices to yet new highs on world markets.

Encouraged by a weakening of the US currency, in which many commodities are traded, investment funds disillusioned with low returns from equities have been quick to latch onto the rally.

As a result, the Commodities Research Bureau's index of 22 basic commodities from oil to butter is at the highest level since 1984.

The index has risen by more than 8 percent since the start of January, climbing above the 275-point mark last week, having been launched in its present form in 1971 at 100 points.

Many analysts expect China to be a major force on the world commodity markets in the years ahead.

snip>
The International Energy Agency (IEA) last week raised its estimate of growth in world oil demand this year by 220,000 barrels per day to 1.65 million barrels owing to strong demand in Asia and notably China

snip>
Base metals such as copper and aluminum have seen their prices surge to eight-year highs, driven by China's seemingly insatiable appetite for raw materials, a large part of which are used for exported goods.

"Chinese demand for the metals has been phenomenal over the past year or two," said Andrew Thomas at the Mining Journal.

"They have been sucking in metals from all over the world, which provided a real boost to physical demand for metals. Chinese demand shows no sign of slowing," he said.

So much so that the world now faces an aluminum shortage this year and next as Chinese demand outstrips limited supplies of the raw ingredient alumina, a recent industry survey found.

snip>
In Brussels last week the head of European steel group Arcelor, Guy Dolle, said a surge in Chinese consumption and production had created "a crazy situation" on the world steel market.

After decades of tight state control, China's economy has been gradually loosened over the past two decades to the extent that in most industries.

The decline in the value of the dollar has only fueled the commodities rally in recent weeks, making raw materials priced in the US unit more affordable to buyers using other currencies.

snip>
Chinese grain output has fallen about 63.5 million tonnes -- Canada's entire annual grain harvest -- since 1998, resulting in a shortage of some 43 million tonnes, a recent report said.

What stocks China has left will be depleted this year, according to the study by the Washington-based Earth Policy Institute, which campaigns for an environmentally sustainable economy.

"The handwriting on the wall is clear ... higher food prices could become a permanent part of the economic landscape," said Lester Brown, director of institute.

more...

[UpInArms]

32. I wonder how they are going to explain

the rise in the CRB in that PPI?

[54anickel]

33. HA! I dunno, how much can they strip out claiming to much price

volatility? Perhaps it will be based on the cost of boxes for product shipment - those haven't gone up too much. :evilgrin:

[54anickel]

34. Fannie Mae posts $6.9B derivative loss

http://washingtontimes.com/upi-breaking/20040316-110315-8737r.htm

WASHINGTON, March 16 (UPI) -- U.S. mortgage guarantor Fannie Mae says its losses on one type of derivative used to hedge interest-rate risks in 2003 were $6.9 billion.

The disclosure of the nearly $7 billion loss, which underscores the risks of the government-sponsored mortgage lender takes using derivatives, came after pressure from analysts and politicians for clarity about results from derivatives activity.

The figure is not expected to imperil Fannie Mae's financial position. The company had net income of $7.9 billion in 2003, the Wall Street Journal reported Tuesday.

The company seeks to allay criticism as Congress considers legislation to tighten regulatory control over Fannie and its smaller rival, Freddie Mac.

a bit more...

[54anickel]

35. U.S. unions take fight to China

http://www.usatoday.com/money/economy/trade/2004-03-16-china-trade_x.htm

snip>
The AFL-CIO filed a 104-page petition with U.S. Trade Representative Robert Zoellick seeking an investigation into China's labor policies. The administration has 45 days to respond.

The petition didn't seek specific penalties against China or the growing numbers of U.S. companies doing business there, but the move puts pressure on the administration to protect U.S. jobs in this election year.

Zoellick's aides declines to comment until they've studied the filing. Spokeswoman Neena Moorjani said the United States aggressively promotes global labor standards and trade laws to help American companies compete around the world.

snip>
According to the petition, the Chinese government abuses workers, pays them far less than what they are worth, forces them to work long hours and bars them from forming unions. Such practices violate World Trade Organization rules and have displaced 700,000 U.S. factory workers, the petition argues.

China exports about $100 billion more products and services to the United States than it imports. Cheaply priced goods are hurting U.S. manufacturers, especially textile companies.

Wei Jinsheng, a Chinese dissident expelled for seeking democratic reforms, blamed foreign companies for encouraging the communist government's labor repression. Multinationals often cut backdoor deals to avoid following the law, he said through an interpreter during a news conference with AFL-CIO officials.

"They can do whatever they want. They don't even follow Chinese law," he said. "The Chinese dictatorship has not only been making the Chinese workers pay a dear price ... but (is) also causing a huge unfairness on the world trade market."

China isn't entirely to blame for U.S. domestic woes, said Clyde Prestowitz of the Economic Strategy Institute. Prestowitz said China, the United States and other member countries violate world trade rules.

Analysts say the biggest obstacles to U.S. job growth are a $500 billion deficit in trade, and services and policies that don't encourage businesses to stay in or move to the United States. For instance, the Chinese give foreign firms tax breaks and build factories, which this country doesn't do, Prestowitz said.

more...

[54anickel]

37. 1:37 update

Dow 10,288.16 +103.49 (+1.02%)
Nasdaq 1,971.52 +28.43 (+1.46%)
S&P 500 1,122.25 +11.55 (+1.04%)
30-yr Bond 4.660% +0.013

NYSE Volume 880,153,000
Nasdaq Volume 1,033,292,000

1:30PM: The major averages maintain the bulk of their gains and continue to vacillate near their session highs... Supporting the advance in the Nasdaq is Yahoo (YHOO 44.40 +1.83), which is among the leading movers to the upside in the Nasdaq 100... As mentioned previously, YHOO was upgraded to Buy from Neutral at Smith Barney and First Albany this morning... Smith Barney said the intermediate-term outlook for the core Yahoo cash flow is stronger and more valuable than what is implied in the current stock price, while First Albany quoted YHOO's recent pullback among the reasons for the upgrade...
Peoplesoft (PSFT 18.53 -0.44), on the other hand, is the biggest laggard in the Nasdaq 100 after JP Morgan said that it will be difficult for the stock to outperform even at its currently inexpensive valuation...NYSE Adv/Dec 2406/832, Nasdaq Adv/Dec 2169/844

[54anickel]

38. Big jump in gold and silver at 1:00 pm - related to bombing in Iraq?

edit to add:

Dollar still holding up so far

Last trade 88.74 Change +0.15 (+0.17%)

High 89.03 Low 88.43

[54anickel]

39. 2:37 update

Dow 10,302.74 +118.07 (+1.16%)
Nasdaq 1,972.42 +29.33 (+1.51%)
S&P 500 1,123.59 +12.89 (+1.16%)
30-yr Bond 4.656% +0.009

NYSE Volume 1,058,449,000
Nasdaq Volume 1,212,988,000

2:30PM: The major averages' totals are little changed compared to the last update, or any update since roughly 11:30 ET for that matter... As mentioned previously, this Friday marks an options expiration, which normally yields to volatile trade in the preceeding sessions... Today has not done much in the sense of volatility, thus far, with the major averages moving in a steady fashion...
In the commodities market, the price of gold is up $4.50 at $407.10/oz, while the price of crude oil is up $0.57 at $38.05/bbl after having reached as high as $38.25/bbl earlier in the session, setting a new 52-week high... The price of crude oil is higher on continued speculation that OPEC will cut production at its March 31 meeting, as well as a U.S. Department of Energy report indicating that gasoline supplies fell 800K barrels to 199.6 mln in the week ended March 12...NYSE Adv/Dec 2461/783, Nasdaq Adv/Dec 2220/842

[KoKo]

41. Hmmm, Market was down on Terrorist Attacts, Market goes up on Bombs

in Iraq? Plus I'm thinking about that big tandem bounce off what looked like a "bottom dropping out" in the markets yesterday which was posted here at the close. Nasdaq heading back to 2000 and other averages climbing. And we still have the "Witching Friday" to contend with but how fast we retrace that "5% pullback."

Interesting? Yes?

[54anickel]

42. The Fed Loves Power and Creating Profits for Finance Companies

A different take on the carry trade...

http://www.gold-eagle.com/editorials_04/benson031704.html

Last month when the Federal Reserve's Monetary Policy Report to the Congress was presented by the Fed Chairman, Alan Greenspan, in my view he made the goals of his legacy crystal clear: For the core business of Wall Street, investment banking and banking (the "carry trade"), he wants to be remembered in the Hall of Fame for having made the finance business the greatest profits in the history of our nation.

The carry trade, for those who are not Wall Street insiders, is the business of borrowing short and lending long. This business is executed by institutions that have access to borrowing directly at the Fed funds rate, or the ability to borrow by using security Repurchase Agreements ("REPO"), most commonly using U.S. Treasury, mortgage-backed, asset-backed, and GSE securities. The carry trade has created the United States finance economy, and about 30% of all profits for S&P companies come from financing activities. The business of borrowing short and lending long has allowed the unprecedented increase in mortgage and consumer borrowing. This has been used by the Fed Chairman to pump up housing prices 45% in the past 4 years so that they can claim household net worth, at $44 Trillion, is the greatest it has ever been.

What has the Chairman actually said and exactly what is it that he wants to accomplish? First, in his speech to the New York Economic Association, he stated that at some point interest rates in the United States will rise. Certainly, Wall Street firms and bank hedge funds engaged in the carry trade care more about a rise in long-term interest rates, than a rise in short-term interest rates. A rise in long-term interest rates can quickly wipe out not only a year's worth of carry profit, but it can wipe out a financial institution's capital (the carry trade offers leverage of over 20 to 1). Currently, Fed funds are locked at 1 percent, and the 10-year Treasury note is locked around 3.7 - 4 percent, which offers about a 3 percent carry profit. If short-term rates only went up one-half percent, or 50 basis points, the carry profit would still look okay, unless long-term interest rates rose.

Last year the Fed was talking about fighting deflation by pegging long-term interest rates. Talk was turned into action by cutting deals with the central banks in Japan and China to do just this. Japan and China currently "peg" the 10-year note yield by buying incredible volumes of United States Treasuries. (Japan, China, and other Asian central banks are flooding their markets with new money. This holds the value of their currencies down while these Asian central banks finance the U.S. budget and trade deficits. In return, Asia gets the new factories and new jobs.) This financing of our trade and budget deficits by foreign central banks is the only reason the U.S. carry trade has not collapsed. The Bush Administration is getting nervous that unless Japan and China revalue their currencies up, we will have virtually no growth before the November Presidential election. For President Bush, this is very bad. However, Greenspan has just said that while Japanese intervention at some point will be problematic, that time is not now. Moreover, Greenspan has also indicated that it would be unwise for China to revalue now because money might flee China. While neither statement on face value is credible, what is obvious is that the only reason the carry trade has not "blown up" is because of Japan and China "pegging the 10-year Treasury" and if they were forced to revalue, they would stop buying U.S. Treasuries. Since our country has no savings and a $550 billion government deficit to finance, when Asia stops buying, our mortgage market will no longer be able to finance equity extraction from homes. Moreover, since wages and salaries are growing at less than the inflation rate, home equity extraction is the only source of unending cash to the U.S. consumer. If the consumer stops spending, not only would it mean that George Bush might not be elected President in November, but the whole world might enter recession. America is the buyer of last resort.

more...

[54anickel]

44. 3:33 update - will there be another late rally?

Dow 10,316.82 +132.15 (+1.30%)
Nasdaq 1,977.52 +34.43 (+1.77%)
S&P 500 1,125.08 +14.38 (+1.29%)
30-yr Bond 4.645% -0.002


3:30PM: With half an hour of trade remaining, the major averages continue to creep higher, with the major averages up 1.3-1.8% and on a course of new session highs... There are 7 earnings reports scheduled tonight, with highlights including DRI, JBL, and TIBX... Tomorrow morning, look for earnings reports from MWD, as well as several retailers including WSM, CHRS, BBA, and BKS... Highlights on the economic calendar for tomorrow include the Initial Claims and Philly Fed Index reports, as well as the PPI, which was originally scheduled for February 19...
Please see the Looking Ahead column for more details on the PPI...NYSE Adv/Dec 2538/772, Nasdaq Adv/Dec 2310/820

[54anickel]

45. Close

Dow 10,300.30 +115.63 (+1.14%)
Nasdaq 1,976.76 +33.67 (+1.73%)
S&P 500 1,123.78 +13.08 (+1.18%)
30-yr Bond 4.645% -0.002

NYSE Volume 1,498,505,000
Nasdaq Volume 1,673,402,000

Close: The market celebrated St. Patrick's Day wearing green, as the major averages spent the session creeping higher and closed with gains of 1.1-1.7% for the major averages... The favorable bias was at least partially rooted in a sense that the market's sell-off experienced through most of March has created attractive entry opportunities... As much was stated in Smith Barney's and First Albany's upgrades of Yahoo (YHOO 44.95 +2.38) to Buy from Neutral...

Also supporting today's advance were a batch of better than expected earnings reports, including those from Federal Express (FDX 71.81 +3.38) and Bear Stearns (BSC 89.00 +1.00)... The Consumer Price Index, which checked in at 0.3% and excluding food and energy at 0.2% demonstrated that inflation remains a non-issue in the current economic recovery... This was also consistent with FOMC's assessment as the committee voted to uphold the federal funds rate at its 45-year low of 1.0% in yesterday's meeting...

The bulk of the sectors closed the session in the green, with leaders to the upside including the hardware, internet, networking, semiconductor, software, telecom, biotech, banking, gold, oil services, transportation, utility, and broker/dealer groups... Laggards of note were harder to come by, with drug among the few notables... Elsewhere, the 10-year note closed down 6/32, bringing its yield up to 3.70%...