STOCK MARKET WATCH, Friday 12 March (#1)

[ozymandius]

Friday March 12, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 317
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 91 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 143 DAYS
WHERE ARE SADDAM'S WMD? - DAY 355
DAYS SINCE ENRON COLLAPSE = 839
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 11, 2004

Dow... 10,128.38 -168.51 (-1.64%)
Nasdaq... 1,943.89 -20.26 (-1.03%)
S&P 500... 1,106.78 -17.11 (-1.52%)
10-Yr Bond... 3.75% +0.01 (+0.32%)
Gold future... 401.00 +0.30 (+0.07%)

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 [e-mail]

For information on protests and other actions Citizens For Legitimate Government

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

[ozymandius]

1. WrapUp by Martin Goldberg - technical analysis

The Stock Market Broke on Wednesday –
Classic Technical Analysis Suggests Additional Drop
In Key Indices, and Even Lower Interest Rates

Key index technical chart patterns were formed recently and have been broken this week. These important events all indicate that the US stock market is now weak from a technical perspective. The Nasdaq and the 10-year Treasury note (as measured by the interest rate) have both formed descending triangles that have been broken. Price objectives from technical analysis principles suggest that the Nasdaq is likely to go to 1,860 or less, and the 10-year Note interest rate will reach 3.3% or less. The Dow Transport index has formed a symmetric triangle, which has been broken decisively to the downside, thereby indicating that the longer-term trend of the Transports is down. Similarly, the Dow Industrials have violated their 50-day moving average. With almost everyone playing “technical analyst” during this rally, this is likely to spell trouble for the overall stock market. In short, this is a momentum market that has lost its momentum. In this article, I will illustrate and describe these technical events.

<cut>
Today’s Market

The stock market opened lower today, apparently impacted by the horrible and tragic terrorist act in Madrid, Spain. The market largely recovered by mid-day, but sold off by the close to finish lower. The Dow finished down over 1.6%, and the S&P 500 closed down 1.5%. The Nasdaq finished down 1%, but price action was especially weak at the close. This is not a good sign. As indicated in the chart above, this was the fifth (5th) consecutive “distribution day”. I doubt if the hot guru, Investor’s Business Daily (IBD), will be able to split any hairs today in describing whether today’s action “felt” like a distribution day. If they are true to their technical philosophy, they will advise their readers to move to cash except for stocks that are acting particularly well. Today’s edition stated, “Corrections are normal for bull markets, which typically last much longer than a year”. You would have to consider after an unprecedented bubble that topped in March of 2000, there would be a secondary bull correction of unprecedented duration.

<cut>
As I finish this article CNBC is on in the background, and there is an analyst describing how “healthy” this correction is. There was nothing healthy about the hype-driven rally; and there is nothing healthy about this “correction”. Look at the charts above, folks! This stuff is right from the textbook. You may get a head fake rally; but the trend is down in my view. If this continues, Wall Street may begin looking at P/E’s.

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

[TrogL]

32. P/E's?

Wall Street may begin looking at P/E’s.

Huh?

[ozymandius]

2. Good morning Marketeers!

:donut: :donut: :donut: :donut: :donut: :donut:

I must admit that yesterday's market performance frightened me. This kind of fear comparable to anarchy in the streets. The phenomenon of see-sawing averages based on current events has become an accepted characteristic of the market for me. This time it's different.

As Martin Goldberg outlines above, the market regained its composure halfway through the trading day. Then it sank back to new lows for a second time that day. A correction has been overdue for quite awhile. The frightening aspect of these numbers is that we appear to be seeing it all at once. And there is no Enron or dot-com catalyst to blame. Evidence suggests that this is a general malaise of the markets.

[Pale Blue Dot]

4. Have they released the PPI yet?

Depending on how that number looks, this could get really ugly.

[UpInArms]

6. here's the press release on the continuing delay

http://www.bls.gov/ppi/delaynotice.htm

Delay of Release of PPI for January 2004 and February 2004

As announced on February 17, the release of the Producer Price Index (PPI) for January 2004 has been delayed from the originally scheduled date of February 19, 2004. The length of that delay now means that the release of February data originally scheduled for Friday, March 12, must also be postponed.

The delays have been caused by unexpected difficulties in the conversion of PPI data from the Standard Industrial Classification system to the North American Industry Classification System. These difficulties have taken far longer to resolve than we originally expected.

We will continue to work diligently to resolve the remaining issues holding up the calculation of the PPI. When revised release dates for the January and for the February 2004 Producer Price Indexes have been determined, we plan to announce them at least one day ahead of time on this web page and through news advisories.

The Bureau of Labor Statistics expresses its sincere apologies to those who have experienced any problems as a result of this delay.


Link to News Advisory Issued on February 17, 2004
http://www.bls.gov/ppi/advisory02172004.htm

Last Modified Date: March 05, 2004

[54anickel]

7. PPI Hostage Release? (from forexnews.com)

The BLS has held the January PPI figure hostage for the past month and said the February PPI will also be delayed. So although scheduled for release today it probably will not. For those who question government inflation statistics the PPI hostage situation has been intriguing.

Apparently, the BLS says its old computers are not capable of handling the reclassified data. What they should say is that they are having trouble reclassifying a surge in commodity prices with the official mantra that inflation is too low. Perhaps the monumental breakout in the CRB index this year has something to do with it? The Institute for Supply Management's indexes of prices paid and supplier deliveries both rose to nine-year highs of 81.5 and 62.1, respectively, in February. The last time these gauges were that high, the federal funds rate was 5.5 to 6%.

But the Treasury and Fed are convinced that the dollar's decline has not stoked inflation and that it remains quiescient. This is the party line so the numbers must match. Remember that if there is an inflation scare the bond market will back up and the Fed’s easy money recovery stops dead in its tracks. If both the January and February PPI remain hostage, the bond market should not take that long to figure things out. The falling dollar has stoked inflation and was the main reason behind this week's record high trade deficit as the cost of oil imports surged.

[UpInArms]

9. for those interested in knowing what the CRB looks like

go here:

http://quotes.ino.com/chart/?s=NYBOT_CRY0&v=dmax

Last trade 275.30 Change -0.12 (-0.04%)

Settle 275.42 Settle Time 15:11

Open 275.41 Previous Close 275.42

High 275.43 Low 275.30

[54anickel]

11. I don't know UIA, it's really difficult to see any type of trend formation

in that graph. HA! :evilgrin:

(Looks like a tracking of my grocery and utility bills)

[UpInArms]

12. I just can't imagine

how they are having difficulties making it appear that there is no inflation /sarcasm

That chart definitely shows 2+ years of gain in the commodities (and none of us need those, right?)

I can only think that they will try to Stalinize the reports and act like we never used the information or needed it for understanding our economy.

[54anickel]

71. Few more nice charts in this article - Inflation vs. The People

http://www.gold-eagle.com/editorials_04/buss031204.html

snip>
Since December 2003 until now, 3 months, the index has risen 24%.

Since Q1 2003 until now it has risen 42 %

snip>
Remember Epicitus, who said, "The extreme of any position will ultimately become its opposite". Greenspan says we don't have inflation - yet every chart tells a different story. A rather strong & evident different story. The position in reality is now the opposite of what the Fed and the government keeps telling you. Now, whom do you believe, Greenspan or Epicitus ?

[KoKo]

29. Ah..UIA's your CRB chart answered my question below, about the info.

already out there!

[whatelseisnew]

10. It is now officially the "Plunge Protection Index"

What a bunch of duck-speak quackmire mofos they are!

[KoKo]

25. Good Morning All! Thanks again, Ozy. "PPI Held Hostage?" only in the

Bush administration would such a term make sense. It's truly amazing the stuff they get away with! And I wonder if what they are hiding isn't already known on the streets and is causing the market to head down. After all aren't there folks on Wall Street besides the Government Statisticians who can put it all together and figure out our economy is heading for the cliff? sheesh!

[54anickel]

14. Futures are looking bright -

setting up of the usual Friday afternoon fleecing?
And here I thought the last couple of days might throw off the game plan.

[UpInArms]

3. daily dollar watch

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

Last trade 89.17 Change +0.66 (+0.75%)

related articles:

http://www.gulf-news.com/Articles/news.asp?ArticleID=113516

GCC undeterred by weak dollar

Saudi Arabia yesterday reaffirmed its commitment to a long-standing link between its currency and the US dollar and said other Gulf Arab states have a similar decision.

The world's oil giant made the fresh pledge although the US dollar has remained at one of its lowest levels since November to add pressure on the region's fiscal and economic system which is already reeling under its heavy reliance on volatile oil sales.

Experts said the plunge in the dollar to its lowest level against the euro in nearly five years has a multiple negative impact on the six GCC countries as it will hit their real crude export earnings, discourage investment in the region, depress the real value of their cash reserves, and increase the cost of their imports from non-dollar nations.

"As we have said before, there is no plan to detach our currency from the US dollar because this link has actually served our economy," he told Arabic language dailies.

"This trend is in line with the GCC summit decisions to maintain the link between our currencies and the dollar because it is the main currency of our trade."

After years of haggling on whether to adopt a new currency system, the UAE and its five partners in the GCC decided last year to maintain the link to the greenback as they set off towards a landmark monetary union following the creation of a customs union in 2003.

...more...

http://www.forbes.com/home_asia/newswire/2004/03/12/rtr1296165.html

ANALYSIS-True test lies ahead for BOJ's Fukui

TOKYO, March 12 (Reuters) - Bank of Japan Governor Toshihiko Fukui had one key item on his "to do" list when he took over from Masaru Hayami a year ago -- prevent the world's second-largest economy from getting sucked into a deflationary whirlpool.

Five monetary policy easings later, deflationary pressures are abating as Japan's financial system routinely bulges with 35 trillion yen ($315 billion) more than it needs on a normal day.

Now, analysts say, comes the hard part.

The risk is that the markets and the banking system have become so used to zero interest rates that even the hint of a switch in policy could cause mayhem in the bond market and ultimately in the banking system and the economy.

Then there's the danger that all that spare cash in the system could eventually fuel runaway inflation if the BOJ does not keep pace with Japan's economic recovery by "normalising" its unprecedented three-year old hyper-loose monetary policy.

Since Fukui took the helm at the BOJ last March, the central bank has more than doubled its liquidity target in the money market, force-feeding cash to banks already awash in funds.

That has not only kept short-term interest rates at zero, but has allowed the BOJ to hold down long- term rates -- critical for debt- burdened companies trying to get back on their feet and the commercial banks that hold piles of their bad debts.

"The greatest of Fukui's challenges lie ahead of him," said Glenn Maguire, Societe Generale's Asia chief economist in Sydney.

"Managing an exit strategy in an economy where many are conditioned to zero interest rates will be difficult to say the least," he said.

...more...

The dollar index has been performing such feats of magic that I am wondering which end is up - will continue watching regardless.

Good Morning Ozy! :hi: Love your 'Toon this a.m. as it definitely turns the "electability" issue back at the GOP :D

Yesterday's market was stunning to watch - wonder what today will do. There are a few economic reports due out http://biz.yahoo.com/c/e.html

I wonder if we'll ever see those PPI reports?

Have a great day Marketeers!

[54anickel]

5. Good Morning UIA, Ozy and all and a Happy Friday (we hope). I see

the mention of another monetary union in that GCC article. It has been quite a while since we've had any discussion or mention of zones, but there are several plans in the works - Asian, S. America, GCC, my "buddy" from Malaysia calling for a united Islamic currency. "Interesting times", these are.

But at their last year's meeting in Oman, where they approved plans to set up a monetary union in 2010, the GCC's Central Bank governors decided to maintain the dollar link.

edit to add:
I think they do have a "plan B" should the dollar no longer serve them until 2010, following Kuwaits lead....

Kuwait, the only GCC country whose dinar is pegged to a basket of currencies, decided to fall in line with those decisions by linking its currency to the US dollar.

[54anickel]

8. Interesting bit on bonds at forexnews as well. Maybe Julie can explain

this for me a bit, is this good or bad for bond investors? I always seem to get this up/down thing mixed up. A major top, meaning a good time or bad time to get into bonds? :shrug:

http://www.forexnews.com/NA/default.asp?f=N20040312B.mgn

Bonds Show Signs of a Major Top

Bonds are likely to be the main focus for investors this year because so much of this recovery has been bought and paid for with cheap money. Yesterday’s plunge in stocks and sharp rise in the VIX still saw the 10-year yield rebound from 3.65%, which marks the 61.8% retracement of the meteoric rise from last summer. That yields rose in light of the dramatic selloff in stocks yesterday bears paying attention. This is especially the case because the dollar looks like it is trying to mount a major rebound. Recall that the dollar’s 10% rally from June to September 2003 saw a sharp rise in bond yields as foreign purchases of US government securities fell 75% to a mere $25 billion in Q3.

Therefore it was telling that yesterday’s 10-year Note auction saw poor demand by foreign institutions. Indirect bidders bought a mere 20% of the total issue, falling far less than this year’s average demand ratio of 45%. Indirect bidders are a proxy for foreign central banks, and thus represent the degree of interest in newly issued US treasuries.

Another asset class to watch is gold, which was paralyzed yesterday around the $400 level. With the dollar falling over 2 cents against the European majors, one would have expected Gold to gain by at least $5 per ounce. Silver on the other hand is probing the spike high of $7.30 seen in 1998. A move above here would be extremely bullish for the precious metals in the big picture. But the divergence with gold, which topped at $430 in January is quite extreme.

[Coventina]

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

Hello everyone!

I thought getting a reading for today was worthy of extra effort, so here it is!

It is REUNITING changing to INEXPERIENCE. Here is the changing line from REUNITING: "During times of discord and disunity a great proclamation or inspiring idea is necessary to again reunify the situation. In this way, others put aside their factionalism and work together once again."

Here is an appropriate comment from INEXPERIENCE: "Your confusion over the difficulties and complexities of the coming event is not caused by ignorance, evil, or laziness, but rather by your complete Inexperience in dealing with such matters."

Sounds like the developing situation in the economy might be like nothing we've ever seen before. I hope someone comes up with the inspiring solution Ching hinted at!

I hope all of you stay safe. I think we may be in for a bumpy ride.
Have a good weekend!
:hi:

[ozymandius]

15. The Casino Cometh

9:33
Dow 10,174.67 +46.29 (+0.46%)
Nasdaq 1,963.13 +19.24 (+0.99%)
S&P 500 1,111.28 +4.50 (+0.41%)
10-Yr Bond 3.743% -0.004

[ozymandius]

16. up slightly at 9:42

Dow 10,178.31 +49.93 (+0.49%)
Nasdaq 1,967.51 +23.62 (+1.22%)
S&P 500 1,112.83 +6.05 (+0.55%)
10-Yr Bond 3.731% -0.016

[54anickel]

17. Oh Ozy, I just read your new sig line! Spit-take, coffee all over my

monitor again.

[ozymandius]

21. Sorry about that. It is unavoidable, unfortunately.

But a quote from either Herr Rove or his boss tends to evoke one of two responses: trembling anger; explosive ejection of one's mouth's contents.

[UpInArms]

19. consumer sentiment numbers out

U.S. MARCH UMICH CONSUMER SENTIMENT 94.1 V 94.4 FEB

blather says market expected 95

lemmings rush in

Dow 10,199.19 +70.81 (+0.70%)
Nasdaq 1,971.90 +28.01 (+1.44%)
S&P 500 1,114.70 +7.92 (+0.72%)
10-Yr Bond 3.737% -0.010

[54anickel]

22. It dropped, it's lower than expectations, yet the lemmings rush in.

[ozymandius]

18. 9:52 figures with a side of blather

Dow 10,180.75 +52.37 (+0.52%)
Nasdaq 1,967.83 +23.94 (+1.23%)
S&P 500 1,112.91 +6.13 (+0.55%)
10-Yr Bond 3.734% -0.013

Stocks Open Higher, Techs Lead Gains

NEW YORK (Reuters) - U.S. stocks opened sharply higher on Friday, following a steep drop in the previous session, as investors flocked into technology stocks, putting aside concerns over Thursday's bombings in Madrid.

short blurb

[54anickel]

20. Into technology stock!?! After today's wrap-up? Sheesh. n/t

[ozymandius]

23. Yes. What's up with that?

One must wonder if the absence of news at early trading has convinced the lemmings that everything is okay. Yesterday never happened. It was all a bad dream devoid of any underlying reason or purpose.

So now I wonder what the consumer sentiment numbers will do to the market.

[ozymandius]

24. 10:10 - Dow down a bit, Nasdaq and S&P up

Dow 10,189.49 +61.11 (+0.60%)
Nasdaq 1,969.63 +25.74 (+1.32%)
S&P 500 1,115.15 +8.37 (+0.76%)
10-Yr Bond 3.734% -0.013

[ozymandius]

26. Are the consumer sentiment numbers taking hold?

Dow 10,180.74 +52.36 (+0.52%)
Nasdaq 1,966.59 +22.70 (+1.17%)
S&P 500 1,113.28 +6.50 (+0.59%)
10-Yr Bond 3.744% -0.003

[UpInArms]

28. blather at 10:00 EST

10:00AM: Market's rally remains undeterred by the slightly weaker than expected Michigan Consumer Sentiment report... The preliminary March reading declined for a second month in a row, to 94.1 (consensus of 95.0) from 94.4, as the expectations component fell nearly two points following the disappointing February jobs report... The market also had two other economic reports earlier this morning that didn't prompt much of a reaction from the indices...

January Business Inventories rose 0.1% (consensus of 0.3%) as retail inventories (the only unknown) showed a small 0.1% rise, whereas the Q4 Current Account Deficit narrowed to - $127.5 bln (consensus of -$136.2 bln)...NYSE Adv/Dec 1703/783, Nasdaq Adv/Dec 1817/ 653

[54anickel]

27. Bonds dip on narrower deficit report

Would be nice to know why it narrowed. The rally in the buck? Drop in the Euro? Drop in the Yen? Fundamentals (Pffft yeah, right)
:shrug:

http://money.cnn.com/2004/03/12/markets/bondcenter/bonds/

Treasury prices fall on reduced need for overseas currency intervention; dollar up vs. euro, yen.
March 12, 2004: 10:08 AM EST

NEW YORK (CNN/Money) - Treasury prices fell Friday after a narrower-than-expected current account deficit report boosted the dollar and reduced the need for other countries to support the dollar through the purchase of U.S. debt.

snip>
The shortfall in the current account balance, the broadest measure of the nation's trade with the rest of the world, shrank to $127.5 billion from a revised $135.3 billion in the third quarter, the Commerce Department said.

snip>
Economists polled by Reuters had expected the funding gap to widen slightly to $136.5 billion in the fourth quarter. The third quarter was initially reported at $135 billion.

"This is probably not going to have much short-term influence on the dollar," Daniel Katzive, foreign exchange strategist with UBS in Stamford, Connecticut, told Reuters.

"The big picture remains the U.S. still has a large deficit and that is the key thing and whether it is up or down $5 billion in a given quarter is not going to convince anyone the U.S. balance of payments is improving dramatically," Katzive said.

[ozymandius]

30. Consumer Sentiment Slips Unexpectedly (story)

NEW YORK (Reuters) - U.S. consumer sentiment dipped unexpectedly in early March as Americans, worried about a lack of new jobs, grew more cautious about the prospects for the economy, according to a survey released on Friday.

The University of Michigan's preliminary reading of consumer sentiment slipped to 94.1 in March from a final reading of 94.4 in February, said market sources who saw the subscriber-only report.

<cut>

"Consumers are more optimistic than a year ago but their optimism is still really restrained compared to where we were in the late 1990s, and it's primarily because the job market is still lagging," said Steven Wood, chief economist at Insight Economics.

http://biz.yahoo.com/rb/040312/economy_sentiment_4.html

[UpInArms]

34. Ozy, have you noticed

how many times the economic report results have been "unexpected" in the past several months?

Do these analysts (or is that anal cysts?) read things that completely cloud all logic or do they actually believe the spinning lies from the lips of *Co?

It confuses me, as it seems that this is just another offshoot of the "we really expected WMDs" chatter - when 14 million people in the street meant nothing -

Why is it that those on the outside have a clearer picture than those who are supposed to have actual "knowledge"?

[ozymandius]

31. 10:44 numbers

Dow 10,170.89 +42.51 (+0.42%)
Nasdaq 1,963.42 +19.53 (+1.00%)
S&P 500 1,112.28 +5.50 (+0.50%)
10-Yr Bond 3.739% -0.008

[ozymandius]

33. 11:12 - not much change

Dow 10,169.35 +40.97 (+0.40%)
Nasdaq 1,964.30 +20.41 (+1.05%)
S&P 500 1,112.13 +5.35 (+0.48%)
10-Yr Bond 3.723% -0.024

[54anickel]

35. What on earth is the deal with gold today? Some extremely sharp

drops showing up on the charts.
:tinfoilhat:

[CaptainClark23]

36. Well, you wanted another window, didn't ya?

Now firmly convinced that a suppresion campaign ala GATA is in effect, I thank the Cabal for giving me these opportunities to build up my own reserves.

a related question for you 50/50 4anickel, since I know you watch PMs:

Silver has always followed gold's lead, but in the past 6 months, silver seems to have left gold's shadow to chart its own course. Do you see anything to the notion of a role reversal here? That now silver will take the point, and gold will be pulled along in its draft?

The gold/silver ratio has been out of balance for some time, and a correction in silver's favor has been long expected. During this period does silver blaze the trail?

[UpInArms]

37. just a hunch regarding silver

because I have no firm way of supporting my thoughts -

with gold being around $400 per ounce, the smaller (financially) players cannot truly "get in" with any measure of success.

Silver, on the other hand, is truly affordable, and many people can collect a respectable amount without having to be a Rockefeller.

Thus, the price of silver would follow the demand for some type of safe haven metal that could be owned by those whose finances would not allow a substantial holding of gold.

[CaptainClark23]

38. And I'm the proof of that

I hadn't really thought about that, great point. I have been buying about 50 to 1 silver over gold, simply because I rarely have the available cash to do gold in any appreciable quantity.

I could defer purchases until I had a sufficient amount saved up, yes. I'm uncomfortable doing that though, I suspect when the proverbial dam breaks, it'll break fast and hard. It could be tomorrow, could be next year, I dunno.

So lets say you are correct - this would indicate a large increase in demand from the "little guys", not Buffet lining his vaults. Then theres alot of people who are catching the direction of the wind and are doing what they can to protect themselves. Consumer confidence indeed.

Thanks for the input!

[54anickel]

72. An article written just for the Captain ;-)

http://www.gold-eagle.com/editorials_04/wallenwein031304.html

[54anickel]

39. Hey there Captain! I don't have my crystal ball with me, but I have seen

quite a few articles on the PMs. There's been a shift lately of folks moving from gold to silver as they see gold taking a bit of a breather here - partly due to the election year and all the tweaking that normally takes place and partly because it was due for a correction. Silver had been trading sideways for a while and was due for a move up, lots of supply demand issues and commodity inflation behind that theory.

I think there may be some of that jumping back and forth between the 2 for a while during the bull market everyone is talking about in PMs. Lots of articles due point to strengths in silver. I think there was even a recent Wrap up posted here this week or last.

Did you catch this article at Kitco this AM?

http://www.kitco.com/ind/GoldReport/mar122004.html

snip>
PA: Silver rose 45% just from October to March. Silver tends to be a sleeper but once it wakes up, it soars. This means if silver now stays above its recent March 2nd high at $6.91, it’ll be in a position to soar. Then if it closes above its 1998 high near $7.30, it could rise to the 1987 high near $9.50. These are the numbers we’re watching on the upside. The fundamentals have been very favorable for silver for many years. And they are perhaps even more favorable now than they were a couple of years ago, when you consider the industrial side of silver.
Silver is stronger than gold. So we’re recommending more silver than gold. We like silver coins and silver shares such as Silver Standard, Coeur d’Alene and Pan American. These are our favorites.

TGR: Do you see gold and silver moving in tandem, with the potential for a correction, or just sideways movement, in both? Or do you see silver having more strength?

PA: Well, so far, we haven’t really had a correction in silver. It’s overbought but it could stay overbought while silver keeps rising. It hasn’t even wanted to break a five-week moving average, which means silver is very strong above $6.50.

[54anickel]

42. This just in - COMEX silver falls below $7/oz as funds liquidate

http://www.forbes.com/markets/newswire/2004/03/12/rtr1296728.html

NEW YORK, March 12 (Reuters) - COMEX silver fell more than 3 percent Friday morning as speculators used a modest retreat in gold as an excuse to take profits on silver's rally to 16-year highs this week.

snip>
Gold was down a less severe $4.20 at $396.80 an ounce. Hedge funds had been buying silver against gold this year, but turned the "ratio trade" around Friday morning, betting that the white metal had become too expensive relative to gold, dealers said.

[CaptainClark23]

46. interesting language

"as speculators used a modest retreat in gold as an excuse to take profits on silver's rally to 16-year highs this week."

Needed an excuse to take profits?
Well, it is friday.

I just wonder how much of that activity is genuine "Speculators" as opposed to "Major financials" as opposed to the "Little Guys" that UIA and I postulate about, above.

The Majors move the market up and down on margins.
The Speculators take advantage of the Majors' manipulations.
The Little Guys buy and hold tight.

A simplistic view, I know. I'm just trying to keep up with you guys, I learn so damn much here.

[54anickel]

47. There's always the profit takers. But the price tends to move so

fast these days that each time they jump back in, it's at a slightly higher price. Then they bid it up again even higher and skim a bit off of that new top. So silly, but I suppose if you are talking big money here the cost of the transactions might be worth it.

The little guy that buys on the dips and holds will come out ahead in the end. He's buying for the safe haven, hoping things will never get bad enough to have to use it. The "little guy" is buying with a totally different motive.

[54anickel]

45. Bit more here - NY gold falls early a day after Spain terror attack

http://www.forbes.com/markets/newswire/2004/03/12/rtr1296707.html

NEW YORK, March 12 (Reuters) - COMEX gold fell below $400 on Friday, unable to retain its safe-haven gains a day after Spain suffered its bloodiest day of terror.

snip>
"As far as the gold and silver are concerned, I think there was more hype about it on ACCESS trade yesterday afternoon, when spot gold went up about $2," said James Quinn, commodities commentator at A.G. Edwards. "Today the market seems to be focusing on the foreign exchange again."

Gains in the dollar overnight sucked some investor money out of gold and other hard assets.

snip>
One floor broker said he expected more stop-loss selling of gold if prices move below $397.00.

snip>
Investment banks were good sellers in the morning, and more liquidation was expected if silver moved below the $7 level.

Dealers said speculators appeared to be taking profits on the steep run up in silver's value relative to gold in recent weeks.

"There was scattered buying around the other side," said a floor broker, adding it "could be that fund buying again, which is probably doing that ratio. He's been buying the silver for the last month and dumping the gold."

The gold/silver ratio rose back above 56 on Friday, bouncing off the 55.5 area which some traders pegged as a technical target for the decline from 70 at the start of the year.

[54anickel]

65. Here's that Wrap up Ozy posted earlier. Just in case you missed it.

http://www.financialsense.com/Market/archive/2004/0308.html

[emad]

40. Europe sinks on terror fears:

http://edition.cnn.com/2004/BUSINESS/03/12/europe.markets.reut/index.html

[54anickel]

41. You know what I don't get -

Yesterday there was all that buzz about "Winds of Black Death" terror threat directly addressed to the US. Yet there's hardly a peep from Homeland Security on it. And you sure can't tell we received a threating letter by the markets here today.

So strange. And the US downplaying Al Qaeda ties to the train bombing. What's that all about? Figured they'd be all over that like white on rice.

[UpInArms]

43. saving the

al kyda attack for later in the year - need to keep the sheep corraled successfully so that they can be frightened at the appropriate moment.

Cannot get proper poll bounce if coin is spent early :evilgrin:

[KayLaw]

48. What I don't get

I'm baffled when they blame a big drop on terrorism fears, but say nothing when the numbers suddenly go up. If people were so afraid in the morning, how did they get over their fears in the afternoon? If yesterday's fall was due to fear of attacks, why are today's numbers so high? Did people just forget about Madrid or what?

[54anickel]

49. IT does make our market players look cold, callous and greedy

doesn't it. I wonder what people in other nations will think when the read about the great rally today after yesterday's concern over Madrid.

[Coventina]

51. Yeah, those 200 people died YESTERDAY... ancient history!

Get with the program!

<sarcasm>

[UpInArms]

44. numbers and blather at 12:00 EST

Dow 10,229.93 +101.55 (+1.00%)
Nasdaq 1,978.50 +34.61 (+1.78%)
S&P 500 1,118.43 +11.65 (+1.05%)
10-Yr Bond 3.723% -0.024

11:30AM: Buyers pick up the pace after slowing down earlier, and lift the market to new morning highs... The Nasdaq specifically has sustained a push back above the 1966 level - a support area - which improves the outlook for the bulls.... The Dow, which was the worst performing index yesterday, is once again the laggard today, although it is showing decent gains... Economically-sensitive issues that have been pummeled in the past are finding bids today...

Caterpillar (CAT 74.17 +1.02), General Motors (GM 45.71 +0.81) and Walt Disney (DIS 25.65 +0.70) are among the leaders, the latter due to talk that Comcast (CMCSA 29.21 +0.16) could bump up its bid for the company... NYSE Adv/Dec 1774/1258, Nasdaq Adv/ Dec 1796/1067

[nolabels]

53. Ah, so the bargain hunters have come out to play

:donut: I never miss-underestimate the ability of a shoppers to pick up on things they don't really need.

[Robbien]

50. Enron Exec Sherrick . . . . hired

El Paso Corporation today announced that Jeffrey B. Sherrick has been named senior vice president, Exploration and Production Services for El Paso Production and Non-regulated Operations. Sherrick, 49, is responsible for Reservoir Engineering; Business Development; Technology; Land Administration; Procurement; and Environmental, Health, and Safety.

Sherrick was most recently president and chief executive officer of Enron Global Exploration and Production Company, an international oil and gas company. Prior to that, he held various positions with Enron Oil and Gas Company, including the position of senior vice president of Engineering, Business Development, and Planning. He holds a Bachelor of Science degree in petroleum engineering from Marietta College.

Will El Paso be the new Enron? El Paso is currently revising its fourth quarter earnings since it has been discovered that they have overstated their oil reserves by 41%!

[catzies]

74. Enron is the new Enron! Did you guys talk about thisWednesday?

I missed it if you did I guess.

Enron's reorganization plan gets blessing from SEC
March 11, 2004
http://www.indystar.com/articles/5/128256-1835-031.html

Houston (Associated Press) -- The Securities and Exchange Commission has approved Enron Corp.'s plan to emerge from bankruptcy, the company said Wednesday in a regulatory filing.

Under the plan, announced a year ago, Enron would emerge from Chapter 11 as two independent companies with different names. The domestic company, CrossCountry Energy Corp., will comprise Enron's whole or part interest in three North American natural gas pipelines. The second, Prisma Energy International Inc., will comprise Enron's interests in international pipeline and power operations.

A hearing to confirm the plan is scheduled for April 20 in New York.

[54anickel]

52. Asia's mass debt weapon points to US

Seems I not the only one that is unforgiving of Nixon :evilgrin:

http://www.smh.com.au/articles/2004/03/12/1078594565010.html

Asia's depressed currencies and massive US dollar reserves are a recipe for an American recession, writes Hamish McDonald.

Despite some evident misgivings about his rising level of indebtedness, US President George Bush's bankers of last resort are continuing to lend him the funds to pay for vital necessities like tax cuts, the war in Iraq and missile defence.

Toshihiko Fukui and Zhou Xiaochuan no doubt have their disagreements about Mr Bush's priorities, but as governors of the central banks of Japan and China, respectively, they are continuing to build up already massive holdings of US Treasury securities.

A warning signal is flashing, however, in a trend by Asian countries to diversify new additions to their foreign reserves away from US dollar investments into other currencies and assets. This is a sign of concern about the growing "twin deficits" in the United States, a federal budget deficit projected at $US524 billion ($717 billion) and a similar current account gap, each equivalent to around 5 per cent of GDP.

Around Asian financial circles there is growing, if still muted, talk of a looming "dollar crisis" equivalent to the sterling crises of the 1960s - when London could no longer support the reserve role of the British pound - unless Washington mends its profligate ways and accepts higher interest rates and taxes.

A default by the US government is still unthinkable, but not so a unilateral change in the rules of international finance - akin to Richard Nixon's halt to the convertibility of dollars into gold in 1971, or Franklin D. Roosevelt's devaluation and repudiation of gold-denominated contracts.

Among the possibilities being discussed are a closing of the exit door to prevent a sudden sell-off of US treasuries by Asian governments, which would require sudden leaps in US domestic interest rates, triggering a recession.

[KoKo]

54. Interesting comments here about Amendment/Oil Reserves?????

(Anyone have any idea what this means? Sounds like desperation, but I could just be reading it wrong.) :shrug:

http://finance.yahoo.com/mo


...................
12:55PM: Indices continue to back off their best levels in the early afternoon drift... So far, sellers have not mounted a serious challenge with their efforts confined to groups like gold, utility, and energy... The oil & gas shares have gotten hit following news that the US Senate approved an amendment to the fiscal year 2005 budget that calls for an immediate halt to deliveries of oil into the Strategic Petroleum Reserve...<\b>

The amendment calls for the revenue accrued from selling royalty oil to be used for deficit reduction and increased homeland security funding, instead of placing the oil into the emergency reserve... Consequently, the price of crude oil has dropped $3.48 to $35.50/bbl...NYSE Adv/Dec 2151/1015, Nasdaq Adv/Dec 2127/880

[KoKo]

56. What happens if we need our "emergency reserves?" Ah....Spring is

coming....I see. Let them deplete until next year and hope for a warm Winter? After all with little US manufacturing we don't need the kind of reserves we've had in the past. Of course more people are driving than ever, but since less people are flying, it all works out in the end??? :eyes:

[Robbien]

57. Well with the largest oil companies

all coming out declaring a revision downward in their oil reserves, we've got a problem Houston.

Shell declared a 10% drop in their reserves, El Paso declared a 41% drop and today BP declared a 2.5% drop (445 million barrels). Then there is China who reported their need for oil increased by 17% over their last year's needs.

And our summertime is coming.

[54anickel]

59. Actually, this could really hurt Shrub politically -

There were some articles floating around not too long ago on this. Shrub was trying to build up those reserves fairly quickly. (Some pointed to his oil grab as one of the causes for the jump in prices along with China's hoarding of course.)

There was speculation that he was attempting to build up the reserves so that he could later release them to bring prices back down before the elections. Clinton sort of did the same thing - he didn't rush to build them up like Shrub is, but he did order some of the reserves released to lower the prices in the 2000 campaign season.

I'll have to see if I can dig one of those up again.

[KoKo]

62. Wasn't Gore criticized for urging a release of Oil reserves because gas

prices went up the Summer before election 2000? I seem to remember a big ruckus where it was called "partisan politics."

So, this "amendment" would see to thwart Bush's attempt at doing the same thing? Or, would it be the reverse?

[54anickel]

63. Here's one - I hadn't seen this one before either, so it's a good one

http://www.usnews.com/usnews/issue/040315/biztech/15oil.htm

Fill-Er-Up And Then Pay Up
Oil reserves are nearly full, but consumers are feeling the pinch

By Marianne Lavelle
The nation's emergency supply of oil, the Strategic Petroleum Reserve, is at a record high. That's thanks to a Bush administration decision, spurred by the September 11 attacks, to reach capacity by next year. However, some industry critics and economists charge that this aggressive stockpiling is helping to raise prices at the gas pump by reducing the amount of oil on the market.

snip>
The president has discretion to release oil from the reserves whenever there is an emergency supply disruption, an authority that has been used only once--during Operation Desert Storm in 1991. However, former President Clinton initiated a series of "swaps" with the oil industry in 2000 to address low petroleum stocks in certain regions of the country, a move that brought down consumer prices and was viewed by some as an election-year maneuver. David Goldwyn, who was assistant energy secretary at that time, says of the Bush administration: "I think they've taken this policy of not replicating the Clinton administration, even when successful, to an unproductive extreme."

more.....

[KoKo]

55. "54" the last paragraphs of your linked article are very interesting....

But why would they? A forced US recession would rebound immediately on Asian exporters. As a source of innovation, the US has no replacement. It would take a sudden political crisis - such a realisation in Beijing that it was about to permanently "lose" Taiwan - might invoke the debt weapon.

Meanwhile, corrective mechanisms are beginning to work, despite the best efforts of the Asian central bankers. The dollar is sinking, the yuan and yen are under upward pressure, and US Federal Reserve chairman Alan Greenspan has just given the first hint of a mid-year interest rate rise. As Japan heads towards becoming the first country with trillion-dollar foreign reserves, the absurdity of its continuing to cower in the Asian trade-account block is more and more obvious.

If the Asian countries do let their currencies rise, leading to tapering trade surpluses and slower speculative inflows, the central banks would have less offshore dollars to sterilise anyway and US Treasurer Snow might have to offer more for his deficit-covering funds: a case of be careful what you wish for.

[54anickel]

58. Just my interpretation of it -

Snow and Greenspin have managed to get us caught between a rock and a hard place.

In a way, this article is saying "who has whom by the short hairs now?" (Probably got my who/whoms mixed up)

The Asian markets need our consumption and (arguably) our innovation, but messing with Taiwan is going to be the line in the sand.

It seems to also be saying that Japan needs to quit being so damned worried about deflation and let their currency rise (I think that's coming after this month). That's when things will get interesting.

As Japan's needs to buy our debt decrease, will be be even more beholding to China - push them too fast into revaluing the yuan and it's "no more selling treasuries for you today!"

[54anickel]

73. KoKo, speaking of China and Taiwan and US "diplomacy" check

out this article. Let's hope Shrub doesn't do anything Stupid later this month.

http://www.chinadaily.com.cn/english/doc/2004-03/13/content_314467.htm

Beijing's calmness and restraint up to now regarding Mr. Chen and DPP members' insistence on referendum on March 20th is based upon an assumption that United States this time has finally seen through the independence intention embedded in Mr. Chen's referendums strategy and will use its unique leverage to help stop the process. Beijing particularly appreciated President Bush's public criticisms on Mr. Chen and since then expected that the pressure would maintain its momentum. What's more, Beijing also has linked Washington's handling Taiwan's referendum issue to testing Bush administration's credibility in its relations with China. Despite the pro-Taiwan forces in Congress and change of priority of President Bush's political agenda after meeting with Premier Wen, Beijing assumes and believes that Washington should not have been so politically na?ve to be fooled again by Mr. Chen's empty reassurance with only moderating the wording of referendum. Otherwise, Beijing would be totally disillusioned, not by Washington's political naivet¨¦ but rather by its incredibility in handling the issue. Beijing has been feeling increasingly concerned and frustrated, however, by the emerging signs of backlash within Washington since Premier Wen's visit.

more...

[54anickel]

60. Is it just me, or are the future charts still pointing to a pre-close

fleecing? Usual Friday game plan still on?

[KoKo]

76. Kick, some good articles here for weekend reading.

:kick:

[JNelson6563]

61. 2:03 and checkin' in

Howdy everybody! What a week it's been eh? Well it seems we may go out with a bang to end it.

I hope everybody has weathered the storm reasonably safely. In spite of today I am remaining in batton-down-the-hatches position. ;-)

2:03 and here's a brighter picture than we've seen all week:


Dow 10,215.72 +87.34 (+0.86%)
Nasdaq 1,973.65 +29.76 (+1.53%)
S&P 500 1,116.73 +9.95 (+0.90%)
10-Yr Bond 3.730% -0.017


Treasuries holding steady as she goes......

:hi:

Julie

[54anickel]

64. Hi Julie! Good to see ya. I had a bond question for you earlier in the

day, but I can't even re-formulate the question now. Oh well, gold is nearing the blue-light special, may need to do some shopping. B-)

[JNelson6563]

68. Treasuries holding pretty steady

That's fine with me. They've moved a lot lately and too much either way isn't good. Goes back to my favorite saying "all things in moderation". ;-)

"Gold shopping" has a nice ring to it. haha

Julie-moderate anarchist

[54anickel]

66. Heading into the final hour

Dow 10,212.15 +83.77 (+0.83%)
Nasdaq 1,972.85 +28.96 (+1.49%)
S&P 500 1,117.03 +10.25 (+0.93%)
30-yr Bond 4.709% +0.019

3:00PM: Indices continue to trade at substantially higher levels thanks to strong sector leadership... Groups that are influential in determining market direction - such as financial and technology - have been solidly positive today and kept the market anchored in positive territory... Despite today's up move, the Dow, S&P 500, and Nasdaq are still down for the week amid Monday-Thursday's large-scale losses... The market is currently in "warnings season" ahead of the Q1 (Mar) reporting period in April, but most of the earnings announcements have actually been positive guidance revisions...
Because of that, Briefing.com is optimistic for a rally during the actual earnings season - owing in part to the market's weak performance recently...NYSE Adv/Dec 2247/1034, Nasdaq Adv/Dec 2159/929

2:30PM: The buying drive gains momentum as the Dow sets a new session high... The return of the technology sector as a market leader has buoyed the spirits of buyers who have been disappointed by its negative showing recently... The participation of the tech group is considered essential in 'confirming' the strength of a market rally... Another indicator in determining sentiment - volume - is not quite as friendly to the bulls today... Volume has run at light rates and has been nowhere near the levels seen in yesterday's session...

Volume is considered a gauge of conviction, although it is important to note that trading activity is usually not that heavy on Fridays with traders looking to head out early for the weekend

[54anickel]

67. 3:48 and the bulls are running

Dow 10,225.34 +96.96 (+0.96%)
Nasdaq 1,976.71 +32.82 (+1.69%)
S&P 500 1,118.29 +11.51 (+1.04%)
30-yr Bond 4.710% +0.020

3:35PM: The bulls flex their muscles heading into the final half hour of trading as the blue averages stretch to new highs... Today's activity has largely been a recovery effort off the devastation seen over the course of the week, and has been helped by two separate upgrades of Dell (DELL 33.06 +1.07)...

Breadth figures have been bullish, industry participation has been strong, and the indices have made progress in working through a number of resistance levels... Next week could see an extension of the reversal, although this assumes the geopolitical climate remains quiet...

Better than expected earnings from brokerages like Morgan Stanley (MWD 60.75 +1.40) - who generally top the consensus estimates by a wide margin - could help boost the market higher...NYSE Adv/Dec 2275/1023, Nasdaq Adv/Dec 2164/946

[54anickel]

69. Here's a different perspective than what we are used to seeing -

(But I'm still a firm believer in being long on gold!) B-)

http://www.gold-eagle.com/editorials_04/temple031204.html

Cash Might Not Be Such Trash After All

snip>
As I have said repeatedly, I have little doubt that the long-term trend for the U.S. dollar is still down. We have discussed ad nauseum for some time ALL the MANY reasons WHY this is the case. However-just as fundamentals have mattered little where the stock market has been concerned in the recent past-neither do they presently matter much where the dollar is concerned. It is technical factors that now argue for a further appreciation for the buck, which likely has considerably further to run before this counter-trend rally becomes history.

The stock market has been bending for this and other reasons; but in the last few trading sessions is showing increasing signs that it also is about to break. For the last few weeks now, the Nasdaq has been trading below its 50-day moving average. Even more ominously-especially if the weakness of the last few days takes the Index below the 1990 level-it will have added to a recent pattern of lower highs and lower lows, as it grinds back down.

Until now, this technical breakdown for techs has been forgiven or ignored by traders, who have rationalized all this by pointing to the market's "rotation." So what, they say, if techs are looking a little green; people are moving from them into sounder issues. Thus, until we see the other indices break down, the Nasdaq's sub-par performance doesn't mean much.

snip>
As I explain in March's issue of The National Investor, traders will not be as forgiving once the NEXT technical support levels are broken in the major averages. The big question is how much-and how quickly-the long-chastised short sellers re-emerge as a potent force. For months now, few have had the courage to try to short stocks, as the technical behavior of the market has been so reliably strong (much more so, I must admit, than I'd ever expected.) But with increasing signs that the cyclical bull market that began a year ago is now over-or, at the least, is entering its most serious corrective phase thus far-we can't be far from a point where those betting against the market begin to regain their fortitude.

At that point, much the same as where the dollar is now concerned, fundamentals won't matter a whole lot; even for those who think Wall Street still has any. It will be the obvious technical signs that stocks have firmly reversed course that will carry the day. If the sell-off begins to accelerate in dramatic fashion as the remaining technical support for stocks is broken, we may well face a question of how many DAYS a 10-15% correction will end up taking.

Those still believing that gold will prove a refuge amid all this do so at their peril. As where the U.S. dollar is concerned, I do not believe the recent (and expected) behavior of the yellow metal is changing its long-term attractiveness. However, were you to take a look at gold's chart of late, you'll find it just as ugly as that of the Nasdaq; a well-defined downward trend punctuated by lower highs and lower lows. Sure, gold will break back to the upside eventually; and probably as it leaves the Nasdaq in the dust. However, especially if I'm right about the dollar, this is clearly no time to have too much bet on gold, especially when the yellow metal has become completely hostage to the euro.

[KoKo]

75. Thanks "54" getting here way "after hours." This is very interesting..no

matter which way we read this. There's never "too much" information when one lives in the "deprived world of info that's balanced" as we do today. :-)'s...

[54anickel]

70. Closing numbers & blather

Hope everybody made a little money today. Have a great weekend :hi:

Dow 10,240.08 +111.70 (+1.10%)
Nasdaq 1,984.73 +40.84 (+2.10%)
S&P 500 1,120.57 +13.79 (+1.25%)
30-yr Bond 4.710% +0.020

Close: Stocks reversed course and shot straight up after four days of hefty losses as traders took advantage of the recent price weakness... Just about every industry group was the recipient of buying activity with the most beaten down area - tech - finding the most interest... The sector capitalized off two separate upgrades (JP Morgan and Morgan Stanley) of Dell (DELL 33.00 +1.01) that helped reverse the recent downtrend and launch the Nasdaq 2.1% higher... The blue chip averages followed suit, although their gains were not nearly as robust...

Basic material, broker/dealer, and transportation performed especially well, and offset mild selling pressure in gold and tobacco... The latter group stumbled on account of a Prudential downgrade of Altria Group (MO 54.42 -1.90) to Neutral-Weight from Overweight based on valuation... Economic reports were fairly numerous today, but did not attract much attention from traders... The Q4 Current Account Deficit unexpectedly narrowed to -$127.5 bln, January Business Inventories rose just 0.1% (consensus of 0.3%), and the March Consumer Sentiment index checked in at 94.1 (consensus of 95.0)...

The bond market, conversely, lost ground in the session in response to its recent upswing, and the relief rally in equities...