STOCK MARKET WATCH, Thursday January 25

[ozymandius]

Thursday January 25, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 725 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2221 DAYS
WHERE'S OSAMA BIN-LADEN? 1926 DAYS
DAYS SINCE ENRON COLLAPSE = 1887
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 7
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54


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




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

AT THE CLOSING BELL ON January 24, 2007

Dow... 12,621.77 +87.97 (+0.70%)
Nasdaq... 2,466.28 +34.87 (+1.43%)
S&P 500... 1,440.13 +12.14 (+0.85%)
Gold future... 648.20 +2.30 (+0.35%)
30-Year Bond 4.91% +0.01 (+0.27%)
10-Yr Bond... 4.81% +0.01 (+0.12%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

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

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. Today's Market WrapUp

A Return to Volatility?
BY CHRISTOPHER M. PUPLAVA

The high priests of each of these risky asset classes all have very persuasive arguments as to why the fundamentals have changed -- in effect, why the current assessment of risk is far more benign than in the past. Call me a cynic, but I don’t buy the theory of “riskless coincidence” -- that the fundamental underpinnings have simultaneously improved for all risky assets at precisely the same point in time. If there’s ever been a visible manifestation of the excesses of the stock of global liquidity -- despite an adverse shift in the flow -- this is it. Like it or not, the excesses of global liquidity have created a profusion of “this time it’s different” stories. I might be persuaded that one or two of them are intriguing -- it’s the profusion that kills me.

In a myopic rush to celebrate the immediate dividends of faster economic growth, the costs of what it has taken to achieve that outcome have all but been ignored. As long as global growth remains strong and the liquidity cycle remains accommodative, I suspect those costs will continue to be finessed. But when the tide goes out and the global growth engine slows for any one of a number of reasons, an increasingly integrated global economy and its tightly interdependent financial markets could well have to come to grips with these costs head on. That remains the biggest potential pitfall of 2007, in my view.

- Stephen Roach, “Global Resilience”, 10/09/2006

The infusion of ample liquidity since the start of the decade to bring us out of the 2001 recession, cushion the economy and markets after the September 11th attack, and the continuation of the Yen Carry trade have put a bid under financial markets and have reduced volatility to an extreme. The Volatility Index (VIX) has been compressed to the lowest levels seen in the index’s history.

-cut-

I found it mind boggling in the Jubak article where Walker estimates that if growth rates on spending continue, government spending on interest would eat up 100% of government revenue by 2030! The path of least resistance and the likely path of the U.S. government is to continue to print dollars to pay for its spending programs and interest payments. If this is indeed the long-term picture, gold will be the safe harbor of wealth while the stock markets may soar due to asset inflation; when priced in gold they may indeed crash dramatically as they did in the 1970s. When priced in gold, the S&P 500 and DJIA are nowhere close to the 2000 highs as the charts below illustrate.

more...

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

[ozymandius]

2. Today's Reports

8:30 AM Initial Claims 01/19
Briefing Forecast 310K
Market Expects 310K
Prior 290K

10:00 AM Existing Home Sales Dec
Briefing Forecast 6.25M
Market Expects 6.30M
Prior 6.28M

10:00 AM Help-Wanted Index Dec
Briefing Forecast 30
Market Expects 31
Prior 30

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

[UpInArms]

9. Initial Claims at 325,000

01. U.S. 4-wk. avg. continuing jobless claims fall to 2.46 mln
8:30 AM ET, Jan 25, 2007 - 1 minute ago

02. U.S. continuing jobless claims fall 39,000 to 2.48 mln
8:30 AM ET, Jan 25, 2007 - 1 minute ago

03. U.S. 4-wk. avg. initial jobless claims up 1,500 to 309,250
8:30 AM ET, Jan 25, 2007 - 1 minute ago

04. U.S. weekly initial jobless claims rise 36,000 to 325,000
8:30 AM ET, Jan 25, 2007 - 1 minute ago

[54anickel]

17. U.S. Existing Home Sales Fell 0.8% in December to 6.22 Mln Rate

http://www.bloomberg.com/apps/news?pid=20601087&sid=aaA2OvIyY0jY&refer=home

Jan. 25 (Bloomberg) -- Sales of previously owned homes in the U.S. declined in December after increases the prior two months that pointed to a gradual improvement in the housing market. Sales for all of 2006 fell by the most in 24 years.

Purchases dropped 0.8 percent last month to an annual rate of 6.22 million, from 6.27 million in November, the National Association of Realtors said today in Washington. December sales fell 7.9 percent compared with a year earlier.

The resales figures are consistent with recent reports, including a jump in December housing starts, that suggest the worst of the slump is over and housing will gradually weigh less on growth. The glut of unsold homes will ease as falling prices and low mortgage rates attract more homebuyers, economists said.

``Demand hasn't tanked,'' Ellen Zentner, an economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said before the report. ``The magnitude of declines will lessen over time. By the third quarter, housing will no longer be a drag and its contribution will become neutral. By the fourth quarter, it'll start to be positive.''

Resales were expected to drop 0.5 percent to a 6.25 million annual rate from November's originally reported 6.28 million, according to the median of 65 forecasts in a Bloomberg News survey. Estimates ranged from 6 million to 6.4 million.

more...

[Danascot]

30. I don't believe the worst is over

Foreclosures due to ARM resets will dump a lot of properties on the market, especially in the formerly hot areas where these same properties made no sense without artificially low ARM teaser rates the first time around.

The cooling markets has driven away the speculators in those same formerly hot markets. These folks were a significant portion of buyers in some markets. You could be a genius by buying pre-construction and selling at a significant profit before completion. Not now.

People were financing new home purchases by cashing in on the artificially inflated equity in their existing homes and otherwise overextending their credit.

A lot of the bubble was fueled by such self-perpetuating forces and these drivers have now been removed.

I think it will be two years or more before the correction in housing works it's way though the bubble excesses, with ripples out to the larger economy the whole time.

[AnneD]

43. I read an article...

last night (can't remember which paper). They said that lenders were getting really aggressive at preventing default and foreclosure. If a homeowner is late, many lenders are personally calling up these folks and trying to negotiate terms, refinance ARM's at their expense-anything to prevent the increased number of defaults. Wish I could link it for you. They don't want a repeat of the S&L scandal. I think their will be more shake out but it seems to be slowing a bit.

[54anickel]

18. The Conference Board Help-Wanted Advertising Index Increases

http://biz.yahoo.com/prnews/070125/nyth093.html?.v=84

NEW YORK, Jan. 25 /PRNewswire/ -- The Conference Board Help-Wanted Advertising Index -- a key measure of job offerings in major newspapers across America -- rose four points in December. The Index now stands at 33. It was 38 one year ago.

snip>

In the last three months, help-wanted advertising rose in seven of the nine U.S. regions. Largest increases occurred in the East North Central (35.9%), West South Central (23.0%), New England (16.1%) and Middle Atlantic (10.5%) regions.

Says Ken Goldstein, labor economist at The Conference Board: "Job advertising in print was up in December, reversing some of the decline earlier in the year. Change in online ad volume (on a year-over-year basis) was a little stronger in December than a month or two earlier. Also, the Leading Economic Index rose in December, suggesting there could be a little more spark in business activity in 2007. Employers are expending a little more effort to attract job candidates, suggesting a stronger labor market in the next few months."

Online Advertised Job Vacancies Up 17 Percent in 2006

In December there were 3,344,600 online advertised vacancies, a rise of 17 percent from last December, according to The Conference Board Help-Wanted OnLine Data Series(TM).

[ozymandius]

3. Oil prices rise on sign of OPEC cuts

LONDON - Crude futures rose back near $56 a barrel Thursday following signs that
OPEC members may be acting on their pledges to cut output and colder weather in the Northern Hemisphere.

-cut-

Crude prices initially fell more than $1 a barrel Wednesday after the U.S. Energy Information Administration reported a larger-than-expected build in gasoline stockpiles and a surprise increase in distillates.

But then futures rebounded as traders weighed other factors in the report and the possibility of colder weather in the U.S. The contract settled 33 cents, or 0.6 percent, higher at $55.37 a barrel Wednesday in New York, the highest settlement since Jan. 9.

-cut-

Oil prices also rose Wednesday after ConocoPhillips' Chief Executive Jim Mulva said that the company was firmly instructed to curb output in its Libya and Venezuela operations. The comments led some traders to abandon their skepticism that the Organization of Petroleum Exporting Countries would not enforce the production cuts announced late last year.

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

[ozymandius]

4. Oil prices rise despite gain in supplies

NEW YORK - Oil prices rose Wednesday, after traders shrugged off news that oil inventories are rising and refocused on the possibility of cold weather and reduced
OPEC production draining supplies.

Crude initially sold off more than $1 a barrel after the U.S. government reported that stocks of crude, gasoline and distillates rose last week. But the market later rebounded above $55 a barrel, extending the big jump Tuesday that was sparked by
President Bush's announcement to boost the nation's emergency oil stockpile.

Wednesday's late rally was caused by several factors: signs that OPEC producers are complying with their announced cuts, forecasts of snow storms in the Midwest and Northeast, and the growing belief that the recent downtrend, which brought crude prices down as much as 18 percent this year to $50 a barrel last week, is over.

http://news.yahoo.com/s/ap/20070124/ap_on_bi_ge/oil_prices_47

Thank you for opening your piehole, President Stupid.

[Roland99]

10. Can't be having gas under $2/gal. Lasted all of about a week and a half here.

Oh well.

[Lucky Luciano]

35. I am long oil right now, so this is good for me,

but I wish others could be given the same cost of living hedge.

[54anickel]

26. Bush plan won't end U.S. foreign oil dependence

http://today.reuters.com/news/articlenews.aspx?type=reutersEdge&storyID=2007-01-24T205005Z_01_N24537200_RTRUKOC_0_US-HOLD-ML-BUSH-SPEECH-ENERGY-DEPENDENCE.xml&from=business

NEW YORK (Reuters) - The Bush administration's new energy plan to slash gasoline demand by 20 percent faces serious economic obstacles and will do little to cut long-term U.S. reliance on foreign oil, analysts said on Wednesday.

The plan, outlined by President Bush in Tuesday's State of the Union address, calls for the world's top energy consumer to cut gasoline use over 10 years through alternative fuels like ethanol and tighter vehicle fuel-efficiency standards.

But analysts say the plan would be costly and primarily reduce U.S. imports of gasoline, not oil from volatile regions such as the Middle East.

"It would be gasoline imports that would be first hit, and we don't get much gasoline from the Middle East. We get it mostly from Europe and Latin America," said Sarah Emerson of Energy Security Analysis Inc.

In addition, the reductions outlined in the plan would not be sufficient to offset demand, which the U.S. Department of Energy estimates will grow from about 21 million barrels per day (bpd) now to 23.3 million bpd in 2017.

"If you look at how many barrels of oil will be displaced, it is around 1.65 million barrels per day, so I don't think we are really weaning ourselves from foreign oil," Emerson said.

more...

[UpInArms]

5. (somewhat daily) dollar watch

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

Last trade 84.79 Change -0.14 (-0.16%)

Dollar Put On Its Pace, Though Fundamentals In Short Supply

http://www.dailyfx.com/story/currency/eur_news/Dollar_Put_On_Its_Pace__1169671344995.html

Little was happening on the dollar’s economic calendar Wednesday, but that didn’t keep traders from bidding the currency against most of its liquid pairings. With outside events like the World Economic Forum and last night’s State of the Union setting the tone for the greenback, the need for strong indicators to keep the dollar moving ahead has grown.

In EURUSD, the proximity of 1.3050 proved a repellent as a 100-point turn developed. Following suit, GBPUSD continued the retracement initiated yesterday, pulling the pair down 185 points to 1.9650. Meanwhile, the dollar returned to its range against the Swiss franc as the broad dollar pick up won an 85-point advance to 1.25. Finally, the carry story has hiccups, as USDJPY dropped 120 points in the overnight, only to produce a swing higher that was once again driven lower.

Pulling back from the action in the majors today, it was hard to pinpoint a single macro economic event that could be labeled the catalyst underlying it all. From the data coffers on the US side, there was only the weekly MBA mortgage applications figure. According to the numbers, mortgages for refinancing and new purchases dropped 8.4 percent through the week ending January 19th. This was simultaneously the biggest slip in a month and the second consecutive contraction. Typically, this indicator would fall on deaf ears when it is not producing a record, but the currency market paid a little more attention today. With existing home sales due tomorrow and new resident sales the following day, the weekly mortgage numbers could act to dampen or leverage the reaction to the more newsworthy gauges. Recently, the housing market has shown signs of life as periphery indicators offer initial signs of a bottom. Purchases of new and previously owned homes grew in their previous reports. Furthermore, the December print on housing starts, permits and the January NAHB Index all graced the market with stronger than expected readings.

Outside the confines of the closely monitored US calendar, there were a few unusual events putting the dollar in motion. Holding over from Tuesday evening, North American markets had their first chance to value the President’s State of the Union address. While most of the comments were not particularly revelatory for the currency market, a few issues did rouse some interest. Perhaps most important was the confirmation of the President’s plan to double the US’ Strategic Petroleum Reserves by 2027. Directly, this would help the nation in the long-run as Americans would have a little over 90 days worth of energy on hand should the foreign tap be completely shut off. However, for the short-term, a renewed demand for oil from the US government mixes with practically the same announcement coming out of China and a turn in the weather. Combined, these factors drove oil beyond $55 per barrel and provide a very real pressure for the US economy. Bring the diversification trend back to life, Kuwait’s Finance Minister recently commented on his unease over the ‘volatility’ in the US dollar. This has led the FM to consider a shift to a basket rather than holding only dollar assets. Finally, the World Economic Forum is underway. Nick-named Davos for the Switzerland resort the forum is held, the meeting of financial heads, politicians and academics has already addressed a number of interesting topics. One thread that will be particularly interesting for dollar bulls to keep track of is whether or not global growth is decoupling from the US economy. Should this be the consensus, a greater desire to diversify among central banks and a general shift away from the greenback.

...more...

Market in Corrective Mode: Now Is the Time to Plan Ahead

http://www.dailyfx.com/story/dailyfx_reports/daily_technicals/Market_in_Corrective_Mode__Now_1169729753409.html

EURUSD – It has been our working assumption that the decline from 1.3296 is impulsive and the fact that we can count 5 waves from 1.1640 to 1.3367 favors a major turn lower. We have also maintained that 1.3051 was key to the bearish case. A daily close above there would do damage to the bearish structure that seems to be unfolding. Yesterday’s high was held to 1.3043 so bearish implications remain. A break below 1.2865 targets the next bearish target at 1.2784 (which is the 161.8% extension of 1.3367-1.3051 / 1.3296). The nature of the choppy trading that has persisted from the 1/12 low at 1.2865 is corrective and could be a fourth wave in a 5 wave bearish sequence from 1.3367. A drop below 1.2865 more strongly argues for the bearish case going forward.

<snip>

USDJPY – We still maintain our position regarding the longer term implications from the 13 month inverse head and shoulders pattern. A long term measured objective is at 128.67 – which is where the advance from 108.96 would equal the advance from 101.67 to 121.38. Weakness from 121.78 looks like the 4th wave in a 5 wave bullish sequence that began at 114.42. This morning’s low held at the 38.2% of 117.97-121.78, which is reinforced by the 1/15 low at 120.05. 119.67 is key to the short term bullish case. A shorter term measured objective lies at 123.21, which is where the 114.42-119.67 rally would equal the rally from 117.97. This is the target on a break above 121.78

...more...

[54anickel]

25. Treasury 10-Year Note Yields Advance to Highest Since August

http://www.bloomberg.com/apps/news?pid=20601009&sid=ajJT1eMSRDOM&refer=bond

Jan. 25 (Bloomberg) -- Treasuries fell, pushing yields on benchmark 10-year notes to the highest level since August, ahead of an auction of five-year notes.

Investors are demanding higher returns during this week's auction of $41 billion in debt as compensation for concern that a strengthening economy will raise the threat of inflation. The government sold $20 billion in two-year notes at a yield yesterday that was the highest since July.

``I hear persistently that yields need to go up,'' said T.J. Marta, a fixed-income strategist at RBC Capital Markets in New York, before the report. ``I fully expect a test'' of the 4.85 percent yield level in 10-year notes.

The yield on the 10-year note rose 3 basis points, or 0.3 percentage point, to 4.84 percent at 10:24 a.m. in New York, according to New York-based broker Cantor Fitzgerald LP. The price of the 4 5/8 percent security maturing in November 2016 fell 3/16, or $1.88, to 98 11/32.

more...

[54anickel]

32. Tokyo Warlords Hijack the Bank of Japan

http://www.321gold.com/editorials/sirchartsalot/dorsch012507.html

In an age when ruling parties of every political stripe manipulate data to promote their own self interests, there is also universal cynicism towards government statistics on inflation. It is natural for official inflation data to be wildly at odds with the realities of the marketplace, and regarded with utter disbelief. Nowhere on Earth is there more skepticism about inflation data than in Japan, especially after Tokyo's financial warlords rigged the core CPI last August, and shaved 0.4% off the official inflation stats with the stroke of a pen.

That slick maneuver handcuffed the Bank of Japan from raising its overnight loan rate to 0.50% for the past four months. Tokyo was able to buy more time to keep the Nikkei-225 index afloat with a cheap yen policy, but Tokyo gold prices are now hovering at 78,500-yen /oz, just 4% shy of their 18-year highs set in May 2006, reflecting the massive amounts of monetary steroids injected by the BoJ into the Tokyo and global money markets for the past five years.

Now, there is heightened speculation that the regime of PM Shinzo Abe has gone a step further and hijacked the Bank of Japan, robbing the central bank of its independence. "The government and the BOJ should share major policy objectives through mutual understanding, but not numerical targets," said Japan's top government spokesman, Chief Cabinet Secretary Yasuhisa Shiozaki on January 23rd.

The Bank of Japan was forced to kept its powder dry on January 18th, leaving its overnight loan rate pinned a just 0.25%, and sending the yen to a four-year low against the US dollar, a 9-year low against the Korean won, and a 14-year low against the British pound. Speculation is rife, that the BOJ buckled under heavy pressure from Tokyo's financial warlords, and a global flight from the Japanese yen could be in the cards in the first quarter of 2007.

Bank of Japan Handcuffed by Ruling Politicians

more...

[ozymandius]

6. G'morning Marketeers.

:donut: :donut: :donut:

I'm on my way to work after getting a late start to the day. Sorry to be so brief.

Please have a great day. I also hope your market-gazing is fun.

Ozy :hi:

[UpInArms]

7. Ford's 2006 loss totals $12.7 billion

http://www.marketwatch.com/news/story/fords-2006-red-ink-hits/story.aspx?guid=%7B7452E960%2D737B%2D4C6E%2D9AC0%2D3D3D61AA7887%7D

NEW YORK (MarketWatch) -- Ford Motor Co. reported Thursday a fourth-quarter loss that mushroomed to $5.8 billion, putting its loss for the year at nearly $13 billion, as the automaker incurred heavy charges to restructure its North American operations.

Ford's quarterly loss of $5.8 billion, or $3.05 a share, widened from $74 million, or 4 cents a share, in the year-earlier period.

Excluding special items, the Dearborn, Mich.-based company (F) said fourth-quarter loss would have been $2.1 billion, or $1.10 a share, reversing a similarly compiled profit of $285 million, or 15 cents a share, in the final three months of 2005.

Restructuring in Ford's North American operations reduced quarterly earnings by $3.7 billion. For the year, the automaker said restructuring reduced earnings by $9.9 billion.

Ford's sales in the three months ended Dec. 31 fell 13% to $40.3 billion from $46.3 billion.

...more...

[Lucky Luciano]

36. Check the chart for Ford today...

EXTREMELY volatile. As soon as they mentioned healthcare changes in the conference call, the stock skyrocketed...
They are also issuing bonuses again to managers to increase their morale. There have been no bonuses for the last two years.

[UpInArms]

8. More Bay Area Homeowners In Foreclosure Trouble

http://abclocal.go.com/kgo/story?section=local&id=4967665

Jan. 24 - KGO - More California families are in danger of losing their homes now than any time in the past eight years. That startling news came today from the Data Quick Information Service which said rising real estate prices, and the risky loans people have taken out, have triggered a 133 percent increase in foreclosure notices to Bay Area homeowners. Only a third of them will actually lose their homes, but clearly, more and more people are falling behind.

A lot of those adjustable rate mortgages are now adjusting. More than 37,000 homeowners received notices of default from their lenders between October and December. It's the first step of the foreclosure process. Bay Area counselors that we spoke to in the housing field tell us they've seen a record number of homeowners coming to them for help.

Maria Benjamin, Community Housing Development Corp.: "We've gone from seeing an average of one to two calls about foreclosure prevention to 10 to 15 calls a week."

<snip>

In fact, Contra Costa County saw a jump from 541 mortgage default notices in 2005 to more than 1,500 in 2006 -- an increase of nearly 180 percent. Rates in Alameda County more than doubled as well from 456 to to nearly 1,200 -- up 157 percent.

And while mortgages in San Francisco, Marin and Santa Clara counties are the least likely in the state to go into default, each county still saw a significant increase -- up 63 percent in San Francisco, 78 percent in Santa Clara and 98 percent in Marin County.

...more...

[Ghost Dog]

11. Davos Ponders a U.S.-Iran War

http://www.businessweek.com/globalbiz/content/jan2007/gb20070124_382982.htm

<snip>

Scary stuff. But the participants—among them, Amr Moussa, Secretary General of the League of Arab States, and Bahrain banker Khalid Abdulla-Janahi—were surprisingly dispassionate as they analyzed the chances of such a conflict and assessed the possible impact on the region. One, businessman Khaldoon Al Mubarak of the United Arab Emirates, focused on the notable gains in economic reform and business dynamism in the Gulf states, allowing some to make progress in diversifying away from oil. He concluded that a U.S.-Iran conflict would set the clock back for the whole area. "Can we afford another war?" asked Mubarak. "Of course not. All the genies would come out of the bottle."

Alternatives to Combat?

Others offered subtler twists on the war theme. Banker Janahi posited a different scenario—that the U.S. doesn't attack. Instead, the Saudis dramatically lower the price of crude in order, said Janahi, "to bring the Iranians to their knees." (Iran's oil industry, being much less efficient than Saudi Arabia's, needs higher prices to sustain profits.) This outcome, said Janahi, would be troubling. The collateral damage to the region's economy from a Saudi oil play would be dramatic. The political fallout would be considerable too, as the Saudis would appear to be tools of U.S. policy.

Raghida Dergham, diplomatic correspondent for Al Hayat, imagined a more radical outcome. Perhaps, she said, the U.S. could simply let the Iranians inherit responsibility for the situation in Iraq. "It's a case of 'We broke it—you own it,'" said Dergham. "Iraq is far too broken for Iran to fix." That, she figured, would undermine Iran's regional ambitions better than another major war.

It was a fascinating discussion that tied the threat of war to other aspects of the Middle East's struggle to find the stable path to development. Maqbool Ali Sulta, Commerce Minister for Oman, noted the huge illiteracy rate in the region—some 70 million lack basic reading and writing skills. Such a deficit he suggested, was responsible for the radicalization of certain elements in the region, especially in Iraq—many Iraqis lacked the tools to form a rounded, accurate worldview.

Throughout the conversation, a tone of exasperation with the U.S. was palpable. Janahi pointed out that moderates in the Arab world often were mistaken by Americans as being moderate out of sympathy with the U.S. Not true: "We're moderates for the sake of our country—we put our national interests first." And, of course, the interests of the Arab world. That world right now is deeply worried about another American war in its midst.

/...

ed. Ah! see DU thread here: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2702637

---

See also International Herald Tribune (23 Jan): http://www.iht.com/bin/print.php?id=4313257

DAVOS, Switzerland

Imagine it's 2010 and dirty bombs explode in three major capitals. Or a human strain of bird flu is spreading across the planet. Or global warming has triggered a super drought over the world's breadbasket regions.

Who will ride to the rescue?

Even in Davos, where the chieftains of world politics and industry gather on Wednesday for the World Economic Forum, a worry is creeping in that nobody is really in charge.

An increasingly global world has exacerbated the need for multilateral action, but it has also shaken the very foundations of the multilateral system: Authority is leaking away from international institutions and from the Western powers that have traditionally led them, leaving the world short on leadership at a time when it is increasingly vulnerable to catastrophic shocks.

The main building block of the world order, the nation state, is seeing its clout blur as other forces — from blogs to Bono to Bill Gates — crowd onto the stage.

"Power is becoming increasingly diffuse," said Kenneth Roth, director of Human Rights Watch. "The world has become multipolar in several respects and our institutions are out of step with this new reality."

The irony is that global awareness of the need for cooperation on issues like climate change, pandemics and terrorism has never been greater.

But beyond each individual problem, said officials and executives in Davos this week to consider what forum organizers have labeled "The Shifting Power Equation," looms perhaps the greatest challenge: How to engineer collective action in a world where America is too weak to dominate but too strong to be disregarded; where old and new powers compete for influence and resources; and where a technological revolution has empowered ordinary citizens and those who want to influence them.

/...

[AnneD]

24. Morning Marketeers....

:donut:

Bridgeport Economists Conviene.....Every economist and prognosticator of importance was huddled around the coffee pot at Allsup's yesterday. The continuing topic was beef futures (expected to be hirer) in the spring. The declining oil prices have not benefited members of the Bridgeport Economic Summit as of yet. The main topic of discussion was the President's State of the Union Speech. Many of the comments made at the round table discussion remain confidential but colourful adjectives were bandied about as were unique anatomical phrases and comparisons.

The discussion turned to the war in Iraq and sharp disagreements ensued. As many of these economist have served in the military, all had strong opinions. The main source of disagreement was not that the war continue, but the manner in which to leave. The more recent Vets were for immediate pull out as were some of the older Vets. All were opposed to the Presidents ideas of sending 'civilians' in with the military. The Civilian Corp idea was unanimously rejected as was the continued rapid redeployment of the National Guard and the Army Reserve. As one economist put it "Even I have to take some time off to take care of my farm equipment. Some of these economist have been helping another member whose extended absence is causing an economic hardship to the family and community (he also worked as a part-time deputy). The meeting ended on that note and the meeting was adjourned with a prayer. Members hit the icy slopes (roads have been iced over) before going home.

This update was brought to you by The Main Street Journal-Where Main Street gets ignored by Wall Street.


Happy hunting and watch out for the bears.

[Ghost Dog]

38. Thing is, what the world as this stage needs is some serious consolidation,

not yet more mindless consumption.

...And, I don't believe I have to paraphrase Marx/Lenin on this, but: From those who have, to those who need. What the world needs, overall actually, given the now unignorable natural resource-limits and, indeed the heat-limit of the planet, is LESS overall consumption.

A homeostatic equilibrium, a sane, sensible balance, must be struck. The (in the cases of a minority, obscene) econimic (ie. resource-consuming) growth of the already rich and well-educated should, at the very least, attempt to attain a steady-state - that is, grow no more, enough! On the other hand, the vast majority of the human population of this planet would dearly love to even begin to enjoy some of the '(social, educational, technical, and very pragmatic) fruits of civilisation achieved, no, better: 'imagined and created through hard work (and a sense of social justice)' by the 'rich' world since these last two or so centuries past (a time period corresponding, btw, with the history of the post-enlightenment, the rejection of various despotic, 'divine-right' systems of authority, the rise of what in certain parts of the world we are pleased to call the 'middle-class' (although we are all, still, in fact, 'working-class', at least we are less (or are we?) less indetured today; not such slaves.) Real progressive socialism, if you like.

) (closing bracket in case I forgot one, there <--) (Once a programmer, always..., begin...end clause)

Most essentially: the society of the planet earth must channel the best of itself towards those who have least. The fat cats already have far too much (and, practically, contribute little).

If we can manage to focus the concept of 'Growth' on the most possibly widespread 'educational' and, indeed, 'cultural' (that is, 'brainpower', which requires few fossil-fuel inputs) then this place may have a future.

But then again, hell, ¿didn't I mention already that I (personally) have no kids; only my (recently even more extended) family's kids, and the kids of my best friends and plenty of others that I love? ... Including, yes, you, Cat who was born and is camping in my garden. And the lizards and the birds.

... And, please be assured (btw :hi: AnneD's stories are most illuminating, and, indeed, gratifying), but, I do not feel that our three-or-four million Euros at this stage -fifty-something- 'patrimony/matromony' raises us in any way beyond what is or ought to be just an average in this part of the world (we are in Euro-Mediterranean/African/Spanish lands, between our at present two homes) given the circumstances.

To our shores arrive so many (out of Africa, especially)looking for the merest chance at life...

[AnneD]

44. I received an e-mail from one of my teachers...

she had been absent and when returned-the jar that contained the money they had raise for their project was stolen. It was just $13. I covered it as an anonymous donor. Seems the children were going to donate the money to www.heifer.org . The group buy goats and cows to help folks in arid regions raise their own source of protein-they bait the hook so to speak.
Well, what can I say, I'm a sucker for good causes-so I anonymously agreed to match their donation dollar for dollar. I guess this is how you change the world, one person at a time one village at a time, sewing hope like seeds.

[Ghost Dog]

49. Yes of course there is room for this kind of assistance AnneD,

The best of which, hopefully, will bear fruit.

And I continue to insist on the power of education. What is of most value arises bottom-up.

In our (personal) case, though, (and we are far from alone), most of our capital (apart from really very little physical property, and very few (almost no) typical 'bourgeois' luxuries (we all here worked hard for this -but yeah, I know, all is relative)) is tied up in a couple of relatively small 'familiy' businesses (what is known as the economic 'tejido', or ´fabric' of Euoropean society) that provide, have provided a lifetime's employment and a decent living to a few hundred people and their families, these last decades. All seriously threatened by multinational 'chain' culture, which cares so little, now, of course.

Will we sell? It's a collective decision, but I think not. We shall resist, cleverly.

Time passes, and the so-called 'mighty' (and all 'monocultures') fall.

Diversity, in the long run, is stability.

Anyone else like to express some kind of relatively priviliged, really, still well-off 'middle-of-road' point of view?

[Danascot]

50. My 85 yo mother has been giving Heifer project gifts

for some years ... I have a modest herd of various creatures myself out there somewhere.

... and my wife recently discovered kiva.org, where you can give someone a gift of money they can use to make micro loans. The giftee can choose the recipient from a list of deserving folks and their enterprises. We did a lot of our Christmas 'shopping' for people on Kiva this year.

[54anickel]

12. Power shift on Davos agenda

http://www.belleville.com/mld/belleville/news/editorial/16542575.htm

snip>

This year's focus is on "the shifting power equation" - another way of saying that global economic and political power is fragmenting and the American unipolar moment is gone.

There is no sense of triumphalism from non-Americans here at the slow decline of U.S. power, nor is there any anointed successor. This year is unlike Davoses past, which extolled American economic and technological primacy (late 1990s) or the rise of Asia, or the hope for a powerful United Europe that would rival the United States.

This is a chastened Davos, with no country or region being lionized, and a frisson of unease about the political future. A survey of participants showed that 61 percent believed that the next generation will live in a less safe world.

If the era of U.S. primacy is gradually passing, no one knows who or what will succeed it. For the first time, China, Brazil, Russia and India account for 40 percent of world output, the Davos organizers say, and Asian consumers are playing an increasingly important role in global demand. A spate of seminars fall under the heading "Economics, new drivers." One panel is titled, "What's on the Mind of Asia's New Business Giants?"

But the world still depends on America as a reliable growth engine. And, as China's economic power grows, we don't know how responsibly it will, or will not, behave. Or as another seminar blurb asks: "What Kind of World Does China Want?"

snip>

Indeed, the sense of this year's program is that governments, including ours, are falling behind non-state actors in driving the world, whether those non-state actors be terrorists, or individuals networking together with computers, or the World Wide Web itself, which can be used to rally movements in ways that states find hard to thwart or duplicate. A whole series of panels will look at technology and society and how networking is driving change.

more...



Derivatives risks loom large for leaders at Davos
http://today.reuters.co.uk/news/articleinvesting.aspx?type=fundsNews&storyID=2007-01-25T085310Z_01_NOA531913_RTRUKOC_0_DAVOS-DERIVATIVES.xml&WTmodLoc=HP-C8-Funds-2

DAVOS, Switzerland (Reuters) - The possibility of a major market crisis caused by financial derivatives is replacing the danger of low interest rates driving asset markets to unstable levels as the top issue on policymakers' worry list.

In a keynote speech at the World Economic Forum on Wednesday, German Chancellor Angel Merkel said proposals to shed more light on hedge funds operations would be a priority for her leadership of the Group of Eight industrial nations this year.

"We want to minimize the systemic risks in international capital markets and to raise their transparency -- above all, I see the need to catch up with hedge funds," she told leading business and political leaders.


Hedge funds, which control about $1.3 trillion (660 billion pounds) in assets and often take high-risk leveraged positions in financial derivatives, have doubled in size over the past five years. As private investment vehicles for wealthy individuals, they currently are regulated lightly.

Concerns that hedge funds have taken advantage of low worldwide interest rates to borrow cheaply and invest in high-risk financial instruments escalated after huge losses last September by U.S.-based fund Amaranth Advisors.

It lost $6 billion, or one-third of its assets in energy trades, stoking fears that heavy losses in high-risk investments by such funds could cause widespread harm to the financial system.

more...

[Ghost Dog]

13. Japanese Stocks Down 49; Dollar Falls

http://asia.news.yahoo.com/070125/ap/d8msa3dg0.html

Japanese stocks fell Thursday after briefly touching a 6 1/2-year high during the trading session as Toyota, Honda and Nippon Steel took a tumble.

The benchmark Nikkei 225 index shed 49.10 points, or 0.28 percent, to finish at 17,458.30 points on the Tokyo Stock Exchange. During the session, it hit 17,617.64, it's highest since July 2000.

Some investors pulled back in afternoon trading as some players waited for earnings results out this week.

"The market has basically priced in good corporate earnings," said Mamoru Maeda, Chuo Securities' head of stock trading.

The recent strength in Tokyo stocks reflects the robust profits of firms amid Japan's long-running economic recovery, Economy Minister Hiroko Ota said Thursday.

/...

[Ghost Dog]

14. Yen weakness from carry trade gone too far-ADB

Yen weakness from carry trade gone too far-ADB

DAVOS, Switzerland, Jan 25 (Reuters) - Yen weakness from carry trades has gone too far as it is not based on Japan's economic fundamentals and the process could unwind within 1-2 years, Asian Development Bank President Haruhiko Kuroda said on Thursday.

He also told Reuters that the Bank of Japan's decision to hold interest rates this month had been correct and any move for a rise next month would depend on economic data.

Kuroda, a former top financial diplomat at the Japanese Ministry of Finance, criticised the extent of carry trade in which investors sell low interest rate currencies such as the yen to buy assets in higher yielding currencies.

"The yen weakness from yen carry trade has gone too far in my opinion," he said in an interview on the sidelines of the World Economic Forum. "The Japanese economy has been growing at around two percent and the problem of corporate bad loans has been solved. So it's hard to understand (yen weakness).

"If it starts to unwind the whole process will be reversed. Since (yen weakness) is not based on fundamentals the unwinding is likely to happen within one to two years," he said.

/...

[Lucky Luciano]

40. A thread about this can be found at my favorite finance site

http://www.nuclearphynance.com/Show%20Post.aspx?PostIDKey=84467

Great site for quantitative trading.

[Ghost Dog]

15. Japan's trade surplus shrinks again in 2006 as China rises

http://asia.news.yahoo.com/070125/afp/070125100934eco.html

TOKYO (AFP) - Japan has said its trade surplus shrank 7.0 percent in 2006, declining for a second straight year as China takes over the mantle of the world's top exporter of manufactured goods.

However, the surplus grew in December, the second straight monthly increase, as the appetite in the United States for Japanese cars remained robust, officials and analysts said Thursday.

The fall for 2006 was mainly due to the high cost of oil as energy imports offset exports of cars and semiconductors, the finance ministry said in a preliminary report.

Japan's trade surplus came to 8.09 trillion yen (66.8 billion dollars) in 2006, the second year it came below China which posted a record 177.47 billion dollar surplus.

"China is taking over over the place of Japan as the sender of manufacturing products to the world, notably the United States," said Junichi Makino, an economist at Daiwa Institute of Research.

"The trend is likely to continue for now," Makino said.

But Japan has also taken advantage of its neighbor's breakneck growth, stepping up exports to China of high-tech goods such as semiconductors.

Japan said its trade deficit with China contracted for the first time in three years in 2006, shrinking 5.2 percent to 2.98 trillion yen.

China has emerged as Japan's biggest trading partner, in large part as Japanese companies use its vast labor pool as a manufacturing base for the crucial US market.

Japan's total exports rose 14.6 percent last year to 75.25 trillion yen in 2006, the fifth straight annual gain, but imports grew much faster, jumping 17.9 percent to 67.16 trillion yen, the fourth consecutive increase.

/...

[Ghost Dog]

16. India projected to join China in surpassing size of the U.S. economy by 2050

http://www.iht.com/articles/2007/01/24/business/rupee.php

MUMBAI: The Indian economy will join that of China in surpassing the size of the U.S. economy by 2050 to become a motor of global growth, according to a new forecast by Goldman Sachs, the investment bank.

The United States is currently the world's largest economy. Goldman forecasts that the Chinese economy will pass that of the United States around 2035, while India will do the same about a decade later.

India has moved onto a much faster growth trajectory than the bank had previously expected, fueled by strong and steady productivity gains in its legions of new factories, which are producing everything from brassieres to cars.

The rise of India will lead to increasing global competition for resources and more pressure on the environment, Goldman said.

Goldman now expects the Indian economy to grow at 8 percent a year through 2020, higher than the 5.7 percent rate it predicted in 2003. Indian trade has been growing at 25 percent a year since 2003.

That year it published what is now widely known as the BRICs report, on the rise of Brazil, Russia, India and China. That report helped to galvanize global interest in developing economies and was often cited by investors during the 2006 bullish market in emerging- country stocks.

Goldman put out a research paper arguing that "India's influence on the world economy will be bigger and quicker than implied" in 2003.

Not all of that influence will be welcome. Accompanying India's growing prosperity, the bank predicted, will be ravenous demand for resources and a profound impact on the environment.

As the country's per capita income quadruples between now and 2020, according to the bank, Indians will buy five time more cars and use three times more crude oil than they now do. India imports 70 percent of its oil today, and its increased needs will put it into direct competition with the United States and Europe for access to Middle Eastern oil and energy from other sources.

Geopolitical strategists have warned that the competition for energy will spur a kind of diplomatic race to the bottom, in which India and China woo diplomatically isolated, energy-rich nations like Iran and Sudan. That, in turn, will make those supplier nations less vulnerable to international pressure on issues like nuclear proliferation or ethnic conflict.

/...

[54anickel]

19. Hedge Fund Chiefs, With Cash, Join Political Fray

http://www.nytimes.com/2007/01/25/business/25hedge.html?_r=2&adxnnl=1&oref=slogin&ref=business&adxnnlx=1169738992-pSrk8+4TIppuw3v9sNYBWw

snip>

Hedge fund money, which now exceeds $1 trillion, has emerged in the last several years as a potentially powerful force in politics, as underscored by the significant role it is playing in the presidential aspirations of Mrs. Clinton and Mr. Giuliani. During the 2006 election cycle, executives who work at the 30 biggest hedge funds made $2.8 million in contributions to political candidates or party committees, almost double the amount in 2000.

Yet it is not just the money they donate directly that makes people in hedge funds attractive to campaigns. They also offer access to other potential donors in the financial world, which in recent election cycles has become one of the biggest sources of political contributions. That pipeline has made it easy for well-connected candidates like Mrs. Clinton, Mr. Giuliani and Senator John McCain to consider forgoing public funding. (Mrs. Clinton has done so; Mr. McCain is expected to opt out; and Mr. Giuliani has not yet addressed the topic.)

And top candidates for the 2008 campaign are expected to raise a lot of money quickly — at least $100 million each by the end of this year by some estimates.

“Are hedge fund guys going to be happy with their art collections and their houses in Greenwich or are they going to take the next step?” said Byron R. Wien, the investment strategist at Pequot Capital. “As Hollywood once invaded politics, you will see the same with hedge funds.”

Money from Wall Street has long been a factor in Washington and has tended to flow, with a policy agenda, to the ascendant political party. Giving by people in hedge funds, on the other hand, tends to be more personal and ideological. Some of the most aggressive donors have been Democratic supporters like George Soros, David E. Shaw of D. E. Shaw and James H. Simons at Renaissance Technologies, as well as younger executives like Thomas F. Steyer at Farallon and Marc Lasry at Avenue Capital, all of whom gave generously during the 2006 election cycle.

more...

[54anickel]

20. Gold futures rise past $650, tap an eight-week high

http://www.marketwatch.com/news/story/gold-futures-rise-past-650/story.aspx?guid=%7B935FF28A%2DD272%2D4207%2DB0F2%2DB197203DB342%7D&siteid=yhoo&dist=yhoo

SAN FRANCISCO (MarketWatch) -- Gold futures headed higher Thursday morning, trading at their highest level in eight weeks and poised to mark a third winning session in a row after breaking through what analysts called a key price resistance level of $650, supported by fresh weakness in the U.S. dollar.

"Bullion prices vaulted well over $650...as market participants decided that declines in the dollar and a further rise in crude oil were reasonably supportive of this assault on previous resistance," said Jon Nadler, an investment-products analyst at bullion dealers Kitco.com.

snip>

"Gold's rebound above the $640.20/$645 chart lines continues to suggest a return to more bullish trends with the metal likely to find scaled up resistance from $648 to $656," James Moore, an analyst at TheBullionDesk.com, said in a Thursday note.

"While a period of consolidation would be healthy, a breach of the resistance band could trigger a rally to the $676 high posted in July," he said.
Still, "investors and traders are showing a marked degree of caution in assembling the building blocks of this rally," said Nadler.

"If a sufficiently solid foundation can be established here, perhaps hedge funds or other trigger-finger happy speculators will reconsider early bailouts at higher levels," he warned.

more...

[54anickel]

21. Icahn Warns U.S. Stock Gains Are Vulnerable to Slide in Dollar

http://www.bloomberg.com/apps/news?pid=20601103&sid=apfVIpE1wPRs&refer=us

Jan. 25 (Bloomberg) -- U.S. stocks are vulnerable to a decline in the dollar because it would weaken corporate earnings and ``really blow up'' the market's four-year rally, billionaire investor Carl Icahn said.

``A lot of these earnings are because these companies are able to buy a lot of goods cheaply abroad,'' Icahn, 70, said in an interview yesterday in New York. ``If the dollar starts falling, this thing could really blow up.''

The manager of hedge funds, private equity and real estate assets also said Federated Department Stores Inc., in which he holds a 0.4 percent stake, would make a possible a leveraged buyout candidate.

The Standard & Poor's 500 Index rose to its highest in more than six years Wednesday after better-than-estimated earnings at Yahoo! Inc. and Sun Microsystems Inc. revived confidence in technology companies. The S&P 500 climbed 12.14, or 0.9 percent, to 1440.13. The dollar has slipped 3.5 percent in the past year against six major currencies.

Federal Reserve officials this month said they were confident that the economy would weather the housing slump and showed few signs they would relax their concerns about inflation. The central bank's Federal Open Market Committee has kept its benchmark interest rate at 5.25 percent since August after 17 straight increases, counting on the slowdown in growth in the second half of 2006 to contain prices.

Icahn built his reputation in the 1980s as a corporate raider, targeting big companies including Phillips Petroleum Co., Texaco Inc. and Trans World Airlines Inc. More recently, he failed to force a breakup of New York-based Time Warner Inc., the world's largest media company.

more...

[54anickel]

22. Investors push back

http://www.boston.com/business/articles/2007/01/25/investors_push_back/

Big public stock investors, famous for voting with their feet when the going gets tough, appear to be growing some spine.

They are pushing back against some big takeover proposals, particularly acquisition offers from private equity firms considered too low, and getting results. Public criticism has opened the door for new competitive bids or led to tougher negotiations by directors who might have otherwise rolled over.

snip>

Public shareholders need to defend their interests in corporate mergers because there are so many of them. That was true last year, and it will be true this year. In any big portfolio, a significant number of companies are likely to entertain takeover offers. It would be nice to think management of those businesses were always looking out for the interest of their stockholders above all else, but it's not very realistic.

More attention has been focused on the sale of public companies to private equity buyers because those acquisitions have tended to come with smaller price premiums attached. It's tempting to blame private equity buyers for getting too many good deals but they aren't the ones at the table to represent the interests of public stockholders. Besides, the price advantage favoring private buyers may be narrowing today.

more...

[54anickel]

23. Gulf states seen shifting away from U.S. assets

http://today.reuters.com/news/articlenews.aspx?type=reutersEdge&storyID=2007-01-25T071650Z_01_L25459574_RTRUKOC_0_US-DAVOS-QATAR-DIVERSIFICATION.xml&from=business

LONDON (Reuters) - Oil-rich Gulf Arab estates are seen shifting their assets away from the United States, and Qatar is keen on customer states including Asia and Europe as destination, the country's financial regulator says.

Middle Eastern countries have been scaling back its once near full reliance on U.S. assets in recent years to minimize risks and enhance returns as they diversify the massive windfall from oil and gas revenues.

"Regionally there is less evidence of enthusiasm to be the major owner of U.S. assets. It doesn't mean U.S. investments will go away but you will find governments and agencies looking at a wider range of opportunities," Phillip Thorpe, chairman and chief executive officer of Qatar Financial Center Regulatory Authority, told Reuters in an interview this week.

"For Qatar it's clearly the case they are enthusiastic to assets in its customer states - follow the gas. Where is it going? That's good place to buy as you are offsetting some risks by buying their assets," he said in the ski resort of Davos where more than 2,400 business leaders and politicians are gathering.

Thorpe said by 2012, the broad breakdown in Qatar's energy customer base would be around one third the UK and Europe, one third Asia and the rest the United States.

more..

[54anickel]

27. Nasdaq short-interest positions fell in January

http://today.reuters.com/news/articleinvesting.aspx?type=newIssuesNews&storyID=2007-01-24T223842Z_01_N24474043_RTRIDST_0_USA-STOCKS-NASDAQ-SHORTINTEREST.XML

NEW YORK, Jan 24 (Reuters) - Short interest on the Nasdaq fell for the January reporting period, the exchange said on Wednesday signaling a slight decrease in bearish sentiment among investors.

As of Jan. 13, the number of short-selling positions not yet closed out fell to 6.88 billion shares from 6.92 billion shares in the previous month.

The Nasdaq's short ratio, or the average number of days it would take to cover the outstanding short positions, rose to 3.84 days from 3.60 days in December.

Investors who sell securities "short" are seeking to profit by betting those stocks will fall. Short-sellers borrow shares, then sell them, waiting for the stock to fall so they can buy the shares at the lower price, return them to the lender and pocket the difference.

bit more...

[54anickel]

33. Why the chip ship will sink

With big inventories and weak demand, the semiconductor industry is in for hard times -- and there is nothing out there to change that situation.

http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/WhyTheChipShipWillSink.aspx

Let's start off in an arena where dreams die hard: the semiconductor industry.

Two of its darlings, Intel (INTC, news, msgs) and Linear Technology (LLTC, news, msgs), lost at beat the number after the close last Tuesday. Intel managed to not only not win, but -- when you adjust its earnings for gain and impairment charges -- to actually make only 23.1 cents per share, instead of the 25.6 cents (aka 26 cents if you round up) it claimed to have made.

Too much junk when sales are punk
Turning to Intel's inventories: After a write-down, they declined a smidgeon from last quarter. However, as the company heads into its two slowest quarters, inventories stand at $3.4 billion -- which is roughly where they were last July when Intel headed into its two strongest quarters. Inventories are up 38% year-over-year, while revenues are down 5%. Makes sense to me!

Intel has been building inventory for more than a year as it continues to ramp up capacity. Advanced Micro Devices (AMD, news, msgs) is also ramping up capacity. These two companies are engaged in a price war while, at the same time, PC demand is nothing special.

Some folks think Microsoft's Windows Vista is going to drive PC demand, but what Vista is going to do is freeze PC demand. The only positive impact that Vista will have on demand is that knowledgeable consumers who are thinking about buying a PC will go out and buy one now, before they have no choice but to buy a Vista-bundled system in two weeks. As for what demand Vista can eke out of corporate America: It's not much. (Microsoft is the publisher of MSN Money.)

An outlook that spells 'look out'
Sometime in the next six months, when Vista doesn't spark any demand and the economy is weaker, Intel will be forced to bite the bullet and cut capacity as it finally realizes that it has way too much. But for now, even as more capacity comes on stream, Intel would have the world believe that its margins will rise in the second half of 2007. That ain't going to happen, and life is going to get very complicated for Intel.

more...

[54anickel]

28. Merrill Pays O'Neal $48 Million After Earnings Surged to Record

http://www.bloomberg.com/apps/news?pid=20601103&sid=a0byeXKczMfg&refer=us

Jan. 24 (Bloomberg) -- Merrill Lynch & Co. gave Chairman and Chief Executive Officer Stanley O'Neal a 30 percent raise to more than $48 million after he led the 93-year-old firm to record earnings and its biggest profit gain in three years.

O'Neal received $700,000 in salary for 2006, a cash bonus of $18.5 million and stock valued at $28.8 million, the New York- based firm said today in a regulatory filing. The previous year, Merrill, the world's third-largest securities firm, gave O'Neal $37 million in salary and bonuses.

``It's mind-boggling to most people how much these CEOs make,'' said Jeanne Branthover, a New York-based managing director and leader of the financial-services practice at executive recruiter Boyden World Corp. ``But they want to show the rest of the world, `Hey, we have the money to give him a substantial, huge bonus.'''

The five largest Wall Street firms paid their employees a total of more than $60 billion last year, up more than 32 percent from 2005, as profits shattered records. Goldman Sachs Group Inc., which led the industry with a 70 percent surge in earnings, paid CEO Lloyd Blankfein $53.5 million, the biggest paycheck ever for a Wall Street chief.

O'Neal, 55, took a larger percentage of his pay in shares than Blankfein, whose stock bonus was $15.7 million. He also earned more than Morgan Stanley CEO John Mack, who received about $40 million in compensation last year.

more...

[Lucky Luciano]

37. Check out how much superstar distressed debt trader

Mark McGoldrick at Goldilocks made...he made $50M in 2005. I have been hearing through the grapevine that he topped $100M in bonus this year. It is confirmed that he earned $500M in profits for Goldi in Q4 2006 alone.

Smartly, he retired...

[54anickel]

29. China's Economy Grows 10.4%, Inflation Accelerates (Update3)

http://www.bloomberg.com/apps/news?pid=20601087&sid=a2d8LBEROGus&refer=worldwide

Jan. 25 (Bloomberg) -- China's economy grew 10.4 percent in the fourth quarter from a year earlier and inflation accelerated, prompting speculation the central bank will raise interest rates for the first time since August.

Consumer prices climbed 2.8 percent in December, the most in almost two years, the National Bureau of Statistics said in Beijing today. The world's fourth-largest economy expanded by 10.7 percent in 2006, the fastest in 11 years.

Accelerating inflation may force China to raise rates or restrict bank lending to cool investment. A record trade surplus has swelled the country's foreign reserves to more than $1 trillion and prompted the U.S. and Europe to call for China's currency to strengthen.

``The inflation figure is pretty high,'' raising the likelihood of a rate increase, said Isaac Meng, an economist at BNP Paribas Securities Asia in Beijing. Exports are ``still too fast, the trade surplus is tremendous.''

The central bank raised rates twice last year and on Jan. 5 ordered commercial banks to set aside more money as reserves for the fourth time in seven months. The bank doesn't have a set timetable for interest rate announcements.

``Excessive liquidity in the banking system will be gradually reduced by further bank reforms and the expansion of the capital markets,'' statistics chief Xie Fuzhan told reporters at a briefing, without elaborating.

more...

[54anickel]

31. Corn has deep economic roots as high prices create ripple effect

http://www.usatoday.com/money/industries/food/2007-01-24-corn_x.htm

WASHINGTON — Corn prices have soared to the highest in a decade, mainly because skyrocketing demand for ethanol production is straining supplies.
Already a rapidly growing industry, ethanol got an added boost from President Bush in Tuesday's State of the Union. Bush touted the alternative energy source, which in the U.S. is mainly made from corn, as one of the key steps to reducing U.S. dependency on foreign oil.

A swift increase in ethanol production has already led to sharp gains in corn prices. The price of corn trading for delivery in March has risen more than 5% in the last month and is up more than 50% from a year ago.

"Since the early 1980s, spikes of this size have occurred only twice before," Goldman Sachs economist Ed McKelvey said in a note to clients this week.

The higher prices will likely prove to be a boon for farmers who grow corn, which is used not only in a wide variety of food products for people, but also to feed hogs, chickens and dairy cows, to make everything from soda to candy, and to produce energy.

snip>


Philippi says her feed costs have risen by a third since September even though she grows some of the corn used in her 2,000-head operation. At the same time, hog prices have fallen. But she says she and her fellow producers are most concerned about supply. Already, she has been told at the local grain elevator that no corn is available for delivery in August. "That's what I'm nervous about," she says.

The National Corn Growers Association, however, assures there will be enough corn to go around.

Going forward, the price of corn will depend largely on the price of oil, creating an unusual link between the two commodities, Swanson says. High oil prices lead to greater interest in ethanol production and thus, higher corn prices. Lower oil prices reduce the urgency to make more ethanol.

"You need to be an oil bull to be a corn bull," Swanson says. "It's the new paradigm."

more...

[54anickel]

34. Between the Lines (Roach)

http://www.morganstanley.com/views/gef/archive/2006/20060123-Mon.html

snip>

As I pondered my notes from this year’s MacroVision, I was particularly struck by the interplay between the consumer and the capex sessions. In general, the group was quite upbeat on the US and global consumption outlook. There was little sympathy for my long-standing complaint about the excesses of the asset-dependent American consumer. Few seemed concerned that an income-short consumption dynamic might falter as the housing bubble now started to deflate. Actually, few seem concerned about the US housing bubble, period. As one participant put it, “American consumers will continue to buy -- it’s our way of life.” As long as employment held up, went the argument, so would household spending. The group was nearly unanimous in believing that there was only modest downside to US consumption, at worst. Furthermore, they argued, any such slippage would likely be offset by improved consumption in Japan, Europe, and China. The global consumer was given a clean bill of health for 2006 by the MacroVision consensus. I was truly the skeptic -- on the outside, looking in.

The second thematic conclusion of MacroVision 2006 was equally compelling -- that any global capex recovery was likely to be limited. This was one of our most popular topics this year, and nearly all of our some 65 participants were at one of the two capex sessions. The group felt strongly that businesses in most major economies would remain reluctant to increase productive capacity -- with, of course, the important exception of China. Instead, incremental growth in capital spending was generally expected to be earmarked toward replacement outlays, especially for short-lived IT equipment. Two possible exceptions were noted -- infrastructure -- especially water, roads, and transportation -- and energy exploration and refining. Private equity participants reinforced this view; one noted. “Not one of our portfolio companies is thinking of adding significant capacity.”

Putting these two conclusions together -- solid consumption and modest gains in capital spending -- unmasks what I believe could well be one of the more important inconsistencies of this year’s MacroVision. I have always viewed capex as a “derived demand,” highly sensitive to business expectations of future demand growth. By contrast, I put far less emphasis on those models that treat capex as an autonomous demand -- driven more by business-sector-specific trends in cash flow and profitability. If I’m right -- and if the MacroVision consensus is correct on the consumption outlook -- then the derived-demand approach would argue for a far more vigorous capital spending outcome than the consensus is currently looking for.

A sharp pickup in business fixed investment could have very important implications for the global macro call. For starters, it would mean a much stronger outcome for world GDP growth than most are expecting, with the world economy drawing added support from the twin engines of both consumption and capex. Insofar as financial markets are concerned, an upside global growth surprise could be far more important than a sector-specific conclusion on consumption or capex. Such an outcome could well lead to a sharper cyclical rise in inflation than the consensus is looking for. And that, of course, could turn the financial market climate from benign to malign -- complete with a rout in the bond market, a deterioration in spread markets (credit and emerging-market debt), and more aggressive tightening by the world’s major central banks. As one MacroVision veteran put it, “This would be the ultimate pain trade.”

snip>

The MacroVision consensus was quite accurate in calling financial markets in 2005. The crowd at this year’s gathering is positioned for an equally benign outlook for world financial markets in 2006. But the most intriguing conclusion was between the lines -- the implied risks of an upside surprise to global growth and a more cyclical outcome for the markets. My baseline call for global rebalancing has never felt lonelier. As we passed in the halls, many of the clients had a hard time making eye contact with me. Was it the height of complacency or well-founded optimism? We’re about to find out.

more...

[54anickel]

39. 12:40 numbers and what-not

Dow 12,573.22 48.55 (0.38%)
Nasdaq 2,449.76 16.52 (0.67%)
S&P 500 1,432.27 7.86 (0.55%)
10-yr Bond 4.86% 0.05
30-yr Bond 4.95% 0.04
NYSE Volume 1,533,845,000
Nasdaq Volume 1,139,421,000

12:30 pm : Selling remains the name of the game heading into the afternoon session as all 10 sectors are now in the red. Technology and Materials were the only two areas showing relative strength 30 minutes ago, but both have recently turned negative. That's not entirely surprising since both sectors were also among yesterday's best performers averaging a gain of 1.5%. Further deterioration in the Energy sector (-1.5%), as oil prices spike to session lows (-1.5%) near $54.50/bbl, also removes some notable leadership. DJ30 -55.08 NASDAQ -18.94 SP500 -8.77 NASDAQ Dec/Adv/Vol 1911/958/1.06 bln NYSE Dec/Adv/Vol 2196/950/764 mln

12:00 pm : For a second straight day, investors have digested another round of better than expected results and upbeat developments coming out of Technology.

Dow component AT&T (T 36.90 +0.27) has been today's headliner, opening at a multi-year high after beating expectations and also guiding double-digit EPS growth this year and next. Surprisingly strong reports from eBay (EBAY 33.14 +3.14), a suggested holding in the Briefing.com Active Portfolio which is up 10.5%, and Nokia (21.07 +0.86), are also lending some support for a sector that was left for dead last week (-3.4%).

Be that as it may, the Dow back in record territory, the S&P 500 finishing at six-year highs and the Nasdaq posting its largest one-day gain this year (+1.4%) a day earlier has just as ineffectively underpinned a sense of uneasiness.

Sure, yesterday's broad-based rally played into the argument that recent consolidation efforts may have been overdone, but such a dramatic surge in one session also leaves some questioning the sustainability of such a move to the upside. That's especially true since only 25% of the S&P 500 has reported quarterly results so far, the percentage of those beating expectations is running below normal and the number of blowout reports is not as large as in recent quarters, which feeds into underlying worries about decelerating profit growth.

Further evidence of stabilization in the housing market to suggest the so-called "soft landing" for the U.S. economy remains intact is also noteworthy. However, while inventories of unsold homes falling 7.9% and median price of homes sold holding steady should be treated as good news, Dec. existing home sales missing economists' forecasts has been viewed as a negative. When the report was released at 10:00 ET, the unexpected decline prompted a knee-jerk reaction in stocks that exacerbated the temptation to lock in some of yesterday's impressive gains.

Of the eight sectors trading lower, Energy is pacing the way (-1.2%). Downside guidance from BJ Services (BJS 27.09 -0.87) and Peabody Energy (BTU 39.61 -1.30) is weighing most heavily on the sector. Other weak spots include Financials, Consumer Discretionary and Industrials. The latter is under pressure in part after Textron's (TXT 92.92 -3.66) FY)& EPS outlook fell shy of expectations and Rockwell Automation (ROK 58.95 -1.55) said it sees slowing growth in Asia. BTK -1.1% DJ30 -43.42 DJTA -1.1% DJUA -0.1% NASDAQ -12.78 NQ100 -0.6% R2K -0.5% SOX +0.7% SP400 -0.9% SP500 -6.40 XOI -1.4% NASDAQ Dec/Adv/Vol 1782/1047/906 mln NYSE Dec/Adv/Vol 2099/985/660 mln

11:30 am : Sellers remain in control this morning as the absence of key leadership weighs on the proceedings. Most notably is Financials, which is relinquishing more than half of yesterday's nearly 1.0% advance. Profit-taking in the brokerage group (XBD -1.2%), a day after Goldman Sachs (GS 217.40 -2.70) and Lehman Brothers (LEH 83.04 -0.96) hit historic highs, is offsetting strength in several REITs. Office REITs (+2.9%), in particular, ranks third among today's top performing S&P industry groups after Blackstone raised its bid for Equity Office Properties (EOP 54.70 +2.00) to $38.3 bln. DJ30 -27.84 NASDAQ -6.52 SP500 -4.15 NASDAQ Dec/Adv/Vol 1686/1096/792 mln NYSE Dec/Adv/Vol 1968/1073/560 mln

11:00 am : After initially spiking to session highs near $56/bbl, oil prices recently turning negative have also helped stocks bounce off their worst levels of the day. Crude for March delivery was up nearly 1.0% following a larger than expected drawdown in weekly natural gas inventories. However, the commodity almost as quickly reversing course and slipping below $55/bbl has restored some relief in a market tempted to take even more gains off the table following yesterday's rally.DJ30 -23.80 NASDAQ -5.35 SP500 -3.36 NASDAQ Dec/Adv/Vol 1782/968/646 mln NYSE Dec/Adv/Vol 2040/974/440 mln

10:30 am : A renewed wave of selling interest now leaves all three indices in negative territory. The Tech sector seeing its intraday gains more than halved within the last 30 minutes now positions the Nasdaq as today's worst performing major (-0.4%). It appears as though the unexpected decline in existing home sales at 10:00 ET prompted a knee-jerk reaction in overall sentiment, leaving investors more cautious following such a huge run-up in tech yesterday (+1.8%). It is worth noting, however, that the housing data do provide further evidence that the market is stabilizing since inventories of unsold homes fell 7.9% and median price of homes sold held steady after declines the past four months.DJ30 -20.99 NASDAQ -8.82 SP500 -3.56 NASDAQ Dec/Adv/Vol 1610/1031/434 mln NYSE Dec/Adv/Vol 1820/1090/282 mln

10:00 am : The major averages remain mixed as split industry leadership continues to dictate this morning's trading action. For a second straight day, Telecom (+0.8%) and Technology (+0.8%) are pacing the way to the upside, due in large part to AT&T's (T 37.59 +0.96) presence in both sectors. Unfortunately for the bulls, Materials -- which has the smallest weighting on the S&P 500 -- is the only other sector trading higher. The Energy sector is tumbling 1.2% as downside guidance from BJ Services (BJS 27.01 -0.95) and Peabody Energy (BTU 38.80 -2.11) prompts further rotation out of oil stocks and into beaten-down tech names. Oil prices are only down 0.2% and still above $55/bbl. DJ30 -13.94 NASDAQ +2.32 SOX +1.4% SP500 -1.62 XOI -0.9% NASDAQ Dec/Adv/Vol 1427/1052/216 mln NYSE Dec/Adv/Vol 1599/1037/108 mln


http://finance.yahoo.com/marketupdate/update

[54anickel]

41. U.S. to increase spending in Afghanistan

http://www.chron.com/disp/story.mpl/ap/politics/4499021.html

WASHINGTON — President Bush will ask Congress to give more than $8 billion to Afghanistan to help its security forces and assist in reconstructing the war-ravaged nation, the White House said Thursday.

That's more than half the $14.2 billion in aid the United States has already given to Afghanistan since the U.S.-led invasion in 2001 that toppled the repressive Taliban.

Three quarters of this year's budget request is for Afghan security forces; one fourth for reconstruction, a senior administration official said on condition of anonymity because Secretary of State Condoleezza Rice was to announce details of the aid at a NATO meeting on Friday in Brussels.

Figures for the next budget year starting Oct. 1 will be released on Feb. 5. State Department spokesman Sean McCormack said the administration decided to talk about the request for Afghanistan now because the issue will dominate the NATO ministerial meeting.

snip>

He also said there is a pressing need to address the problem of high levels of opium poppy production in Afghanistan.

"Everybody understands that it's a problem that needs to be addressed," McCormack said. "We don't want an Afghanistan (economy) that is based solely on production of narcotics and international aid."

snip>

"It had been over five years since we went into Afghanistan and the situation on the ground — economic and security — has changed," said Gordon Johndroe, a spokesman for the National Security Council. "There's now a viable government that we're working with. Substantial progress has been made in many areas, but it's also clear that the policy needed to be reviewed, so that we continue to improve the lives of Afghan citizens."

more...



I'm telling ya, the Bush junta has got to protect the opium profits, they're over producing again!

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=102&topic_id=2694922

[Lucky Luciano]

42. Stations Casinos (STN) looking for a bump

Shareholders looking likely to reject current $84 offer. They want $97 it is rumored right now.

[citizen snips]

45. Stocks Plummet in Midafternoon Trading

NEW YORK (AP) -- Stocks pulled back sharply Thursday, sending the Dow Jones industrials down more than 100 points, as investors grew concerned over a lackluster report on sales of existing homes.

The drop in the Dow and a reversal of two days of strong performance by tech stocks came as a sell-off occurred in the bond market. The 10-year Treasury note broke through a 200-day moving average of 4.85 percent. Earlier in the day, investors' cheer over quarterly reports from eBay Inc., Nokia Corp., AT&T Inc. had failed to translate to gains as strong earnings news had done in previous days.

"We had a great run," said Ryan Larson, senior equity trader at Voyager Asset Management, a division of RBC Dain Rauscher. "I think people are kind of tired right now and looking for other avenues."

In midafternoon trading, the Dow Jones industrial average was down 101.10, or 0.80 percent, at 12,520.67.

Broader stock indicators also fell. The Standard & Poor's 500 index was down 13.83, or 0.96 percent, at 1,426.30 and the Nasdaq composite index was down 27.01, or 1.10 percent, at 2,439.27. On Wednesday, the Nasdaq rose well over 1 percent and the Dow set record

more...
http://biz.yahoo.com/ap/070125/wall_street.html?.v=34

[citizen snips]

46. Chips Snap: Trident Rises, LSI Falls

NEW YORK (AP) -- Semiconductor stocks climbed modestly in Thursday's trading, with Trident Microsystems Inc. speedily trading ahead of the pack thanks to the completion of its stock option grants probe.

The company said Wednesday it expects to record $40 million to $50 million in stock-based compensation expenses, for grants that had been erroneously accounted for.

Shares of Trident, which have traded between $14.85 and $31.49 over the last year, were up $2.51, or 13.7 percent, at $20.78 in afternoon trading on the Nasdaq.

Elsewhere in the sector, LSI Logic Corp. and Agere Systems Inc. shares got slammed after LSI projected a flat to lower first-quarter profit. Caris & Co. analyst Shebly Seyrafi cut his ratings on the stocks. Seyrafi cut LSI to "Average" from "Buy" based on margin pressure, and Agere to "Average" from "Above Average," as Agere is being acquired by LSI.

more...
http://biz.yahoo.com/ap/070125/sector_snap_semiconductors.html?.v=1

[citizen snips]

47. EBay Among Wall Street's Big Movers

NEW YORK (AP) -- Stocks that were moving substantially or trading heavily Thursday on the New York Stock Exchange and Nasdaq Stock Market:

NYSE

Ford Motor Co., up 10 cents at $8.30.

The company posted a loss of $5.8 billion in the fourth quarter amid slumping sales and huge restructuring costs, pushing the automaker's deficit for the year to $12.7 billion, the largest in its 103-year history.

Lockheed Martin Corp., up 92 cents at $98.06.

The defense contractor's fourth-quarter earnings rose 28 percent amid growth in its military hardware business and other areas. The company raised its full-year profit forecast.

more...
http://biz.yahoo.com/ap/070125/wall_street_stocks.html?.v=2

[citizen snips]

48. Ford Posts Record Loss of $12.7B in 2006

DEARBORN, Mich. (AP) -- Ford Motor Co. lost a staggering $12.7 billion in 2006 -- an average of $4,380 for every car and truck it sold. The company that invented the assembly line and whose name was a byword for the auto industry warned it will bleed cash for two more years before it has a shot at making money.

Ford's loss, reported on Thursday, was the worst in the company's 103-year history and came amid slumping sales and huge restructuring costs. It surpassed the old record of $7.39 billion set in 1992.

A fourth-quarter loss of $5.8 billion helped drive up the red ink, which for the year amounted to $6.79 per share versus a profit of $1.44 billion, or 77 cents a share, in 2005.

Although huge, the losses were far from the largest quarterly or annual corporate deficits on record -- Time Warner Inc. reported a $97.2 billion loss in 2002, largely due to new accounting rules about how to value assets. Ford could not rely on accounting rules, however, to explain its total.

more...
http://biz.yahoo.com/ap/070125/earns_ford.html?.v=37

[54anickel]

51. What the hell happened here? I come in to sweep up and find a bloody mess.

Sumpthin turned sour after 1:30


Dow 12,502.56 119.21 (0.94%)
Nasdaq 2,434.24 32.04 (1.30%)
S&P 500 1,423.90 16.23 (1.13%)
10-yr Bond 4.87% 0.06
30-yr Bond 4.96% 0.05
NYSE Volume 3,044,544,000
Nasdaq Volume 2,291,351,000

4:20 pm : Evidently, the absence of potentially troubling economic data a day earlier did help investors place more of an emphasis on the "good" news embedded in earnings reports because today's mixed earnings news and economic data dashing hopes of a Fed rate cut anytime soon took a toll on sentiment.

The major averages opened mixed as investors weighed the sustainability of yesterday's impressive rally against another round of better than expected results. Dow component AT&T (T 36.84 0.21) was the day's biggest name, opening at a multi-year high (+2.6%) after beating expectations and guiding for double-digit EPS growth this year and next. Nonetheless, blue-chip buyers began showing some reserve early on, especially after the Dow hit record levels and the S&P 500 hit six-year highs Wednesday.

The Nasdaq wasn't faring much better early on as it was clinging to a small gain following unexpectedly strong results from tech companies like eBay (EBAY 33.65 +3.65) and Qualcomm (QCOM 38.16 -0.46). eBay, a recommended holding in the Briefing.com Active Portfolio, was up as much as 18% last night following its encouraging Q4 report and still closed up 8%. Be that as it may, a two-day hiatus from any economic reports also left investors anxiously waiting to see if the housing market was still showing signs of stabilization.

Then, at 10:00 ET, existing home sales for December checked in shy of economists' forecasts and, for all of 2006, fell 8.4% -- the largest annual decline in 17 years. While that was responsible for a knee-jerk reaction in stocks that exacerbated the temptation to take some of yesterday's gains off the table, the worst was yet to come.

Fed funds futures, which were pricing in a nearly 50% rate cut before June, erased all expectations of a Fed easing. As a result, bonds began selling off, which lifted the yield on the 10-year note to five-month highs and left investors pricing in a more hawkish Fed stance just days before the next FOMC meeting. Such concerns weighed heavily on the rate-sensitive and influential Financials sector.

Since higher interest rates spark valuation concerns among growth stocks, Technology found itself under some additional profit-taking pressure. That was especially evident on the tech-heavy Nasdaq, which surrendered nearly all of Wednesday's 1.4% advance. In fact, Microsoft (MSFT 30.45 -0.64), which is also a Dow component and the fourth most influential constituent on the S&P 500, was up as much as 1.3% at 4 1/2-year highs earlier in the session. However, the overwhelmingly bearish bias eventually weighed on the software giant as investors growing nervous about tonight's Q2 report closed the stock at its worst level of the day and down 2.1%.

On a positive note, oil prices plunged 2.1% to close at $54.23/bbl, but subsequent absence of leadership from Energy (-2.0%) -- today's worst performing sector -- and the failure of transportation stocks to take notice raised another wall of worry about current valuations. Sure, the bulk of earnings reports were again better than expected today; but the percentage of those beating estimates (~55%) running below normal (65-70%), and the number of blowout reports not as large as in recent quarters, merely fed into underlying worries about decelerating profit growth. BTK -1.4% DJ30 -119.21 DJTA -1.4% DJUA -0.6% DOT -0.8% NASDAQ -32.04 NQ100 -1.4% R2K -1.3% SOX -0.5% SP400 1.2% SP500 -16.23 XOI -2.1% NASDAQ Dec/Adv/Vol 2146/883/2.15 bln NYSE Dec/Adv/Vol 2551/771/1.70 bln

3:30 pm : More of the same for stocks as all three major indices remain on pace to snap a two-day winning streak. The Dow has now joined the S&P 500 and Nasdaq lower with a decline of at least 1.0%; 29 of 30 components are trading lower. Among virtually every industry group that is now on the defensive, Homebuilding (-3.4%) is today's worst performer. As if Beazer Homes (BZH 44.43 -2.58) swinging to a Q1 loss and guiding FY07 EPS well below forecasts wasn't bad enough, the homebuilder also saying they have "yet to see any meaningful evidence of a sustainable recovery in the housing market" has completely overshadowed today's otherwise decent housing report. Bond yields climbing to five-month highs has also weighed on the rate-sensitive group. ..HGX -2.5%.DJ30 -125.78 NASDAQ -33.10 SP500 -16.67 NASDAQ Dec/Adv/Vol 2175/831/1.86 bln NYSE Dec/Adv/Vol 2551/740/1.38 bln

3:00 pm : Sellers remain in complete control of the action heading into the final hour of trading. As reflected in the A/D line, decliners holding a more than 3-to-1 edge over advancers on the NYSE, and a more than 2-to-1 margin on the Nasdaq, further reflects the uphill battle bulls are facing at the moment. A wider ratio of down to up volume paints an even more dismal picture at both the Big Board and the Composite.DJ30 -110.31 NASDAQ -29.40 SP500 -14.40 NASDAQ Dec/Adv/Vol 844/2136/1.69 bln NYSE Dec/Adv/Vol 2504/758/1.26 bln

2:30 pm : The bottom continues to fall out of the market as the major averages slip even deeper into negative territory. The Dow and S&P 500 have now completely erased yesterday's respective 0.7% and 0.9% gains, as they break through technical levels of 12510 and 1430. The Nasdaq (-1.2%), which recently failed to find key support near 2438, now leaves it within just 0.2% of also relinquishing everything it made Wednesday.DJ30 -120.88 NASDAQ -32.18 SP500 -15.28 NASDAQ Dec/Adv/Vol 2093/892/1.54 bln NYSE Dec/Adv/Vol 2449/816/1.14 bln

2:00 pm : After some initial hesitation following the recent spike in bond yields, all three of the major averages are now taking a bearish cue from the sell-off in Treasuries and making fresh session lows. Faring even worse than large-cap names are small and mid-cap companies, which is not all that surprising since they are typically more dependent on borrowing. The Russell 2000 Index is now in negative territory for the year. Since higher interest rates spark valuation concerns among growth stocks, Technology also finds itself under some additional profit-taking pressure. That is especially evident on the Nasdaq, which has now given back more than half of Wednesday's 1.4% advance.DJ30 -90.53 NASDAQ -22.77 NQ100 -0.9% R2K -1.1% SP400 -1.0% SP500 -11.46 NASDAQ Dec/Adv/Vol 1963/1006/1.38 bln NYSE Dec/Adv/Vol 2295/940/1.00 bln

1:30 pm : Not much has changed since the last update as stocks appear to be settling into a relatively narrow range. Bonds, however, are extending their reach to the downside following a weaker than expected auction. At the top of the hour, a $13 bln auction of new 5-year Treasury notes attracted a meager 21.8% indirect bidder participation rate, exacerbating earlier weakness sparked by further proof of stabilization in the housing market. Throw in the fact that fed funds futures now price in no chance of an interest cut through the first half of 2007 and the yield on the 10-year note (-15/32) now stands at a five-month high (4.86%). DJ30 -50.32 NASDAQ -16.15 SP500 -7.91 NASDAQ Dec/Adv/Vol 1896/1015/1.27 bln NYSE Dec/Adv/Vol 2253/952/930 mln

1:00 pm : The indices are bouncing off their early afternoon lows, but the absence of spirited leadership from a number of blue chips remains an obstacle for the bulls. On the Dow, 22 of 30 components are trading lower. McDonald's (MCD 43.55 -0.61) paces the way lower, nearly matching yesterday's 1.5% sell-on-the-news decline following record Q4 results. Other blue chips down at least 1% include AIG, AXP, HD, VZ, and XOM. DJ30 -50.79 NASDAQ -16.52 SP500 -7.94 NASDAQ Dec/Adv/Vol 1911/980/1.18 bln NYSE Dec/Adv/Vol 2210/945/858 mln

[silverlib]

52. Just kickin this up for 01-26-07