Saturday, December 26, 2009

Unintended Consequences

12/26/09 Unintended Consequences

ZeroHedge: "Here is the only math you need to know as we all look at 2010: in 2009 US Dollar denominated fixed income supply, net of the Fed's Quantitative Easing operations, was $190 billion. In 2010 it will be $2,060 billion, an eleven fold increase. The Fed has three choices: 1) a QE 2 announcement soon, causing a plunge in already low Democrat popularity ahead of the mid-term elections; 2) interest rates skyrocketing, throwing the economy into a true tailspin; 3) the mother of all engineered equity crashes to return capital flow to risk-free assets. None of the three is a pleasant choice, however the Fed could only delay the inevitable hangover from the biggest private-to-public risk transfer in history for so long....Out of the $2.22 trillion in expected 2010 issuance, $200 billion will be absorbed by the Fed while QE continues through March. Then the US is on its own: $2.06 trillion will have to find non-Fed originating demand. To sum up: $200 billion in 2009; $2.1 trillion in 2010. "

The benchmark 10-year note’s yield rose 26 basis points on the week, or 0.26 percentage point, to 3.80 percent, according to BGCantor Market Data. That’s the highest level since Aug. 10. The 3.375 percent security due in November 2019 fell 2 5/32 or $21.56 per $1,000 face amount to 96 16/32.

Two-year note yields rose 18 basis points on the week to 0.97, the highest level since Oct. 30. The note to be sold on Dec. 28 in a record-tying $44 billion offering traded at 1.02 percent in pre-auction trading. The debt drew a yield of 0.802 percent, the lowest ever, at the last auction, a $44 billion offering on Nov. 23.

Andrew Bary: "Burlington Northern warned of a weak economy and tepid recovery ahead of its merger with Berkshire Hathaway. Wall Street, take note."

Permits to spew carbon-dioxide into the atmosphere fell by $3.30 between the first day of the Copenhagen climate summit and the day after its disappointing conclusion. The decline suggests that despite years of diplomatic efforts, the real world still operates as if people can spew carbon more or less at will.

TARP Repayments Reach $164 Billion.

Bill Bonner: "A new law will take effect in February. Like every new law, it disrupts the old laws by which people organized their lives. This one decrees that credit card companies shall henceforth cease the practice known as “universal default.”

If a fellow defaults on one credit card, the other credit card companies rightly figure he’s likely to do the same to them. So they take precautions, cutting him off from future credit.

But the authorities want people to spend – apparently, even people who can’t pay their bills. So, they are outlawing the practice of “universal default.”
The term “unintended consequences” was invented for these occasions."

Calculated Risk: "Regulators did deliver some not so good Christmas gifts this week as formal actions were issued to three institutions including Midwest Bank and Trust Company, Elmwood, IL ($3.5 billion); Centrue Bank, Streator, IL ($1.3 billion); and Bayside Savings Bank, Port Saint Joe, FL ($86 million).
With these changes, the Unofficial Problem Bank List includes 545 institutions with aggregate assets of $295.6 billion."

Thursday, December 24, 2009

More Market Gains

12/24/09 More Market Gains

A big drop in volatile aircraft orders masked a broad-based increase in demand for other U.S.-made durable goods in November, the Commerce Department estimated Thursday. Orders for durable goods rose a seasonally adjusted 0.2% in November, held back by a massive 32.6% drop in aircraft bookings. Excluding transportation goods, orders rose 2%. Orders were stronger in every major industrial category outside of transportation. Orders for core capital equipment goods - a gauge of business capital investment - jumped 2.9%. Total orders were weaker than the 0.6% increase expected by economists surveyed by MarketWatch. Orders are up in two of the past three months and are up 3.8% since June.

First-time claims for state unemployment benefits fell a seasonally adjusted 28,000 to 452,000 in the week ended Dec. 19, hitting the lowest level since September 2008, the Labor Department reported Thursday. Economists polled by MarketWatch were looking for an initial claims level of 470,000. The four-week average of new claims fell 2,750 to 465,250, which also the lowest level since September 2008. In the week ended Dec. 12, the number of people who continued to collect benefits fell 127,000 to 5.08 million, the lowest level since February. The four-week average of continuing claims fell 90,000 to 5.23 million, the lowest level since March. The insured unemployment rate remained at 3.9%.

Reports say Arrow Trucking based in Tulsa, Oklahoma unexpectedly shut down, leaving around 1,400 drivers without a job.
Arrow trucking has a station in Laredo. No trucks, no personnel, nothing, just an empty space.
Just three days before Christmas, Arrow Trucking told their drivers where to leave their trucks in the nearest arrow station without any answers.
Drivers were confused not knowing what just happened.

The fact that the Federal Reserve and US Treasury cannot identify the second largest buyer of treasury securities this year proves that the traditional buyers are not keeping pace with the US government’s deficit spending. It makes us wonder if it’s all just a Ponzi scheme." Eric Sprott

Mortgage rates rose for a third straight week as the 30-year loan climbed back above the 5% level for the first time since Oct. 29, Freddie Mac said Thursday.

Karl Rove: "Taxes start going up now, Medicare cuts begin after next fall's election, and spending for subsidies commences in five years. The price tag is not the first decade's announced $871 billion cost: It is $2.4 trillion. That's the cost of the tax credits in insurance exchanges, and the additional Medicaid costs the reform generates, over the first 10 years it's fully up and running, according to Congressional Budget Office numbers compiled by Republicans on the Senate Finance Committee."

Working gas in storage was 3,400 Bcf as of Friday, December 18, 2009, according to EIA estimates. This represents a net decline of 166 Bcf from the previous week. Stocks were 359 Bcf higher than last year at this time and 395 Bcf above the 5-year average of 3,005 Bcf. In the East Region, stocks were 162 Bcf above the 5-year average following net withdrawals of 99 Bcf. Stocks in the Producing Region were 174 Bcf above the 5-year average of 893 Bcf after a net withdrawal of 53 Bcf. Stocks in the West Region were 60 Bcf above the 5-year average after a net drawdown of 14 Bcf. At 3,400 Bcf, total working gas is above the 5-year historical range.
Natural-gas futures erased their earlier gains Thursday, heading lower as the Energy Information Administration data showed a smaller-than-expected drop in U.S. inventories last week. Natural gas stockpiles fell 166 billion cubic feet in the week ended Dec. 18, the EIA said. Analysts surveyed by Dow Jones had expected a drop of more than 170 billion cubic feet. After the data, January natural gas futures lost 0.7% to $5.78 per million British thermal units. It was up more than 1% before the data.

Warren Buffett’s Berkshire Hathaway Inc. reported 21,000 fewer employees than it had at the end of 2008 amid a slump at the firm’s manufacturing and retail units.

Berkshire and its subsidiaries have about 225,000 workers, the Omaha, Nebraska-based company said this week in regulatory filings. That’s 8.6 percent lower than the 246,083 disclosed in the 2008 annual report. Berkshire provided the jobs information in a document tied to its planned $26 billion takeover of railroad Burlington Northern Santa Fe Corp. Buffett didn’t reply to a request, left with an assistant, for comment on the cuts.

Shares of natural gas producers touched fresh highs for 2009 on Thursday, ahead of a major winter storm expected in the Midwest.

Bill Bonner: "Under the influence of unprecedented stimulus from the feds, the US economy did not go into a Japan-like slump; it went into a bubble.

But now the bubble has popped…and it appears that the US is finally entering the Japanese trap. And there’s nothing much the feds can do about it. Government spending keeps the GDP from collapsing. But it is phony GDP…government giveaways, boondoggles and payoffs to the financial industry.

“It is a depression,” we told a small group of Dear Readers in Paris on Friday night. “It has nothing in common with the typical post-war recession. And it won’t end until it has done its work.”

Barry Ritholtz: "Over the past week, relatively good economic news (headlines, anyway) have some people discussing a recovery in 2010.

That got me thinking: If the market bottomed in March 09, how often does that anticipate an economic recovery ?

Ron Griess (of The Chart Store) had the answer. Typically, the markets bottom 3, 4 or 5 months in advance of th recession’s end. However, it has been as much as 7 months (1954) and in 2001, the market did not bottom until 12 months after the recession’s end ."

The S&P 500 ended the day with a 0.5% gain and the trading week with a 2.18% advance. The Dow Jones Industrial Average gained 0.5% for the day and 1.85% for the week. The Nasdaq Composite gained 0.7% for the day and 3.35% for the week.

Wednesday, December 23, 2009

Weak New Home Sales

12/23/09 Weak New Home Sales

The American Petroleum Institute reported a drop of 3.707 million barrels in U.S. crude inventories last week, more than analysts expected. The API also reported that gasoline stocks fell 1.1 million barrels while distillate stocks fell 745,000 barrels.

Microsoft Word is now scheduled to be prohibited from sale beginning January 11, 2010. That's less than three weeks away.

If you don't understand, you might have simply missed this story, or dismissed it as something that Microsoft would ultimately use its considerable clout to have pushed under a legal rug.

But it's no joke. In August of this year, a court sided with a small Canadian company called i4i that holds a 1998 patent on the way the XML language is implemented, finding that Microsoft was in violation of that patent. The result: Microsoft was told to license the code in question from i4i or reprogram it, or else Microsoft Word would have to be removed from sale in the market. The original ruling gave Microsoft until October to get its legal affairs in order, but appeals pushed that out a bit.

Now a federal court has upheld that original ruling -- plus a fat, $290 million judgment against the company -- imposing the new January 11 D-Day on the matter. Microsoft Word and Microsoft Office will both be barred from sale as of that date -- though naturally you'll still be able to use copies of Word and Office that you already own, and Microsoft will be allowed to keep supporting those copies.

Consumer spending rose 0.5% in November, compared to economists' expectations for a 0.7% increase. Personal income also rose less than anticipated. After inflation, after-tax disposable incomes rose 0.2% for the third straight month. Inflation-adjusted real spending increased 0.2% in November after a 0.4% gain in October. The personal savings rate was steady at 4.7%.

The People's Bank of China said Wednesday that the economy recovery is still insufficient and that correcting structural problems for the nation's growth is urgent. "Our nation's economic situation is generally improving, but the internal strength of the economic recovery is still not enough, and structural contradictions still exist, [making] a change to the path of economic development ever more urgent," it said in a statement on its Web site, citing its fourth-quarter Monetary Policy Committee. The PBOC added it will seek to keep policy flexible and will focus on decreasing economic volatility and manage the pace of loan growth.

Wal-Mart Stores Inc will continue its holiday discounts and deals into the week after Christmas, the world's largest retailer said on Wednesday, as it introduces new deals and extends some old ones.

Rob Hanna: "Due primarily to some massive trading in index calls in the last ½ hour of the day on Tuesday, the CBOE index put/call ratio actually finished lower than the CBOE equity put/call ratio. This has only ever happened 4 other times since they began tracking the data in 2003."

U.S. property and casualty insurance sales plunged 5 percent in the third quarter, the biggest drop since at least 1986, on lower prices and reduced demand.

Yesterday there were only two sunspots and colder weather is still forecast.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.4 percent to a seasonally adjusted annual rate1 of 6.54 million units in November from 6.09 million in October, and are 44.1 percent higher than the 4.54 million-unit pace in November 2008. Current sales remain at the highest level since February 2007 when they hit 6.55 million.

In November, employers took 1,797 mass layoff actions involving
165,346 workers. Mass layoff events and associated initial claims both
decreased over the month to their lowest levels since July 2008. The
number of manufacturing events, at 481, decreased by 138 over the
month, and associated initial claims, at 56,243, decreased by 14,329.

Lawrence Yun, NAR chief economist, said the rise was expected. “This clearly is a rush of first-time buyers not wanting to miss out on the tax credit, but there are many more potential buyers who can enter the market in the months ahead,” he said. “We expect a temporary sales drop while buying activity ramps up for another surge in the spring when buyers take advantage of the expanded tax credit, which hopefully will take us into a self-sustaining market in the second half of 2010. In all, 4.4 million households are expected to claim the tax credit before it expires and balance should be restored to the housing sector with inventories continuing to decline.”

The Treasury Department soon will ask Congress for legislation to provide some relief from its Troubled Asset Relief Program rules to improve lending to small businesses, CNBC reported Wednesday, citing unidentified officials. Treasury is seeking to have between $30 billion and $40 billion of TARP funds available for small businesses.

Demand for U.S. home loans fell last week to the lowest level in almost two months even though mortgage rates held steady below 5 percent, the Mortgage Bankers Association said on Wednesday.

Nov. New Home Sales: -11.3% to 355K vs. 425K expected, 430K prior. Months' supply 7.9 vs. 6.7 prior. New home sales are based on contracts signed, so these numbers are what the market looks like post stimulus credit.

Dec. Reuters/UofM Consumer Sentiment: 72.5 vs. 73.5 expected, 73.4 preliminary, 67.4 in Nov. Expectations 68.9 vs. 66.5 prior. "Consumers' evaluations of their personal finances improved slightly in December, but the gains still left their overall assessments at quite negative levels."

November single family portfolio delinquecies rose to 3.72%.

Argentina government delays prepayment plan for 2010 debt.

WSJ: The National Weather Service forecasts colder-than-normal temperatures from Dec. 30 to Jan 5 for the Southeast, Texas and parts of the Midwest, while much of the Northeast will see seasonal temperatures. MDA EarthSat, a Rockville, Md., private forecaster, predicts colder-than-normal temperatures at the start of January in the Southeast, Midwest and parts of the Northeast, followed by more-seasonal temperatures in the Midwest and Northeast.

Traders are looking ahead to weekly data on natural gas storage. Storage levels have been at record highs amid increased production from unconventional gas sources and weak industrial demand amid the recession. Last week the report showed a surprisingly large draw from storage, although gas inventories remain high. Total gas in U.S. storage as of Dec. 11 was 3.566 trillion cubic feet, 14% above the five-year average and 12% above last year's level.

Another large draw in production could support the idea among some analysts that a sharp decline in the number of rigs in operation is starting to curb production levels and tighten supply.

Crude inventories fell 4.9 million barrels, the EIA said. Analysts polled by Platts had expected a drop of 2 million barrels. Gasoline inventories fell 900,000 barrels, and distillate stockpiles, which include diesel and heating oil, fell by 3.1 million barrels. After the data, February crude rose 2.5% to $76.27 a barrel. It was up less than 2% before the data.

The Standard & Poor's 500 index needs to gain 31% by the end of the year to break-even for the decade, or 8.7% including dividends, said Standard & Poor's index services unit late Wednesday. It's got even more to go before it returns to high points reached during the past 10 years. After closing at an all-time high of 1,565 on Oct. 9, 2007, the benchmark index tumbled 57% to its close of 676.5 on March 9, 2009. Wednesday's finish at 1,121 means the index has climbed halfway between the March 2009 low and the Oct. 2007 high. But it still needs to gain nearly 40% to get back to that October peak, said analyst Howard Silverblatt.

The Dow Jones Industrial Average gained 1.51 points to 10,466.44. The S&P 500 added 2.57 points to 1,120.59. The Nasdaq Composite rose 16.97 points to 2,269.64.

Tuesday, December 22, 2009

Interest Rates

12/22/09 Interest Rates

The U.S. economy grew at the fastest pace in two years during the third quarter, but the revised annual growth rate of 2.2% was much slower than initially reported, the Commerce Department estimated Tuesday. U.S. real gross domestic product increased for the first time since the spring of 2008, boosted by higher consumer spending, a rebound in investments in homes, a slower pace of inventory reduction, more exports, and robust government spending. Economists surveyed by MarketWatch were expecting only a minor revision to 2.7% in the third estimate. The revisions to third-quarter GDP were in three major areas: Business investment, consumer spending, and inventories.

The yield on the 10-year increases to 3.74% and 30-year rises to 4.61%.

ICSC Retail Store Sales: +0.6% W/W, up from +0.4% last week. +0.4% Y/Y, down from +2.4%. The week-on-week gain, a result of increased holiday shopping, is overshadowed by the huge year-on-year dip.

New measurements from a NASA satellite show a dramatic cooling in the upper atmosphere that correlates with the declining phase of the current solar cycle. For the first time, researchers can show a timely link between the Sun and the climate of Earth's thermosphere, the region above 100 km, an essential step in making accurate predictions of climate change in the high atmosphere. "American civil liberties were gutted last week, and the media failed to report it.
Anyone who is arbitrarily declared a "suspected enemy combatant" by the president or his designated minions is no longer a "person."
The development? If the president or one of his subordinates declares someone to be an "enemy combatant" (the 21st century version of "enemy of the state") he is denied any protection of the law. So any trouble-maker (which means anyone) can be whisked away, incarcerated, tortured, "disappeared," you name it. Floyd's commentary:
After hearing passionate arguments from the Obama Administration, the Supreme Court acquiesced to the president's fervent request and, in a one-line ruling, let stand a lower court decision that declared torture an ordinary, expected consequence of military detention, while introducing a shocking new precedent for all future courts to follow: anyone who is arbitrarily declared a "suspected enemy combatant" by the president or his designated minions is no longer a "person." They will simply cease to exist as a legal entity. They will have no inherent rights, no human rights, no legal standing whatsoever - save whatever modicum of process the government arbitrarily deigns to grant them from time to time, with its ever-shifting tribunals and show trials. "

Since the end of 1999, stocks traded on the New York Stock Exchange have lost an average of 0.5%.

Washington Post: "The recession's jobless toll is draining unemployment-compensation funds so fast that according to federal projections, 40 state programs will go broke within two years and need $90 billion in loans to keep issuing the benefit checks. "

John Hussman: "Last week, the dividend yield on the S&P 500 dropped below 2%, versus a historical average closer to double that level. While part of the reason for the paucity of yield in the current market can be explained by the 20% plunge in dividend payouts over the past year, as financial companies have cut or halted dividends to conserve cash, the fact is that current payouts are not at all out of line with their historical relationship to revenues, and even a full recovery of the past year's dividend cuts would still leave the yield at a paltry 2.5%. The October 1987 crash occurred from a yield of 2.65%, which was, at the time, the lowest yield observed in history, matched only by the 1972 peak prior to the brutal 1973-74 bear market. "

Home buyers rushed to qualify for an expiring federal tax credit, boosting resales of U.S. homes by 7.4% to a 6.54 million seasonally adjusted annual rate, the National Association of Realtors reported Tuesday. The sales pace was the highest since February 2007 and was the third straight large increase. Sales are up 28% since August. Buyers were rushing in November to finalize sales ahead of the Nov. 30 expiration for the tax credit, said Lawrence Yun, chief economist for the real estate lobbying group. The tax credit was subsequently extended and expanded to include repeat buyers.

Marc Faber: Avoid the U.S. Disaster, Buy Wheat, Sugar, Natural Gas, and Japan in 2010.

ComScore reports the storm spurred a 13% rise in digital purchases, resulting in "the heaviest online spending week on record at $4.8 billion."

The benchmark index for U.S. stock options slipped below 20 for the first time since August 2008 as equities rallied on higher-than-estimated existing home sales and stock-market swings fell to a two-year low.

The VIX, as the Chicago Board Options Exchange Volatility Index is known, retreated 3 percent to 19.87 at 12:30 p.m. in New York and dropped as low as 19.76. It measures the cost of using options as insurance against declines in the Standard & Poor’s 500 Index, which added 0.3 percent and moved in a 0.52 percent range, the narrowest this year and about a quarter of its 2.04 percent average for 2009. One-month historic volatility for the S&P 500 fell to 12.41, the lowest since October 2007.

On the Comex division of the New York Mercantile Exchange, gold for December delivery lost $9.40, or 0.9%, to $1,086 an ounce, the lowest settlement since Nov. 3. Oil turned higher in afternoon trading, with the February delivery rising 68 cents, or 0.9%, to end at $74.40 a barrel on the New York Mercantile Exchange. The new front-month contract, February crude had fallen as low as $72.72 earlier.

A final vote on the Senate's health-care reform bill has been scheduled for Thursday morning at 8 a.m., Senate Majority Whip Dick Durbin's office said Tuesday, averting an extremely rare Christmas Eve vote. Senators will vote on both the health-care overhaul and a short-term extension of the U.S. debt ceiling, Durbin's office said. The health bill cleared two procedural hurdles early Tuesday morning.

The Dow Jones industrial average gained 48.37 points, or 0.46 percent, to 10,462.51. The Standard & Poor's 500 Index advance 4.15 points, or 0.37 percent, to 1,118.20. The Nasdaq Composite Index rose 13.51 points, or 0.60 percent, to 2,251.17.
Earlier in the session, the S&P 500 hit a technical milestone, surging to an intraday high of 1,120.27 -- its highest in 14 months.

Monday, December 21, 2009


12/21/09 Trends

Mike Burk: "The trends that can be identified are modestly positive.

I expect the major indices to be higher on Thursday December 24 than they were on Friday December 18."

Spyker, the Dutch carmaker that wants to buy Saab from General Motors, submitted a revised offer after a previous deal had fallen through and prompted GM to say that it would close the Swedish brand.

Joel Bowman: “It has been reported that prices for commercially built new residential units in Beijing, Shanghai and Shenzhen have jumped above 50 percent so far this year, outpacing the growth of local economies by more than 5 times,” the paper continues.

On Friday, Zhang Xin, chief executive officer of property developer SOHO China Ltd, warned that prices in the red hot real estate market may already be overheated.

“The government needs to realize how serious the asset bubble is,” Zhang told newswire, Reuters. “It cannot control the asset bubble by just saying a few words. The most fundamental solution is to tighten credit.”

“There is a bubble in every city,” Zhang added.

That’s the problem with central governments’ stimulus spending, of course: one never knows when enough is enough.

According to Forbes, “More than 1.6 trillion yuan, or about one-sixth of China’s new loans, went to the property sector in the first 11 months, including mortgage loans to home buyers and lending to developers.”

Alcoa said it'll team up with Ma'aden, the Saudi Arabian Mining Company, to invest about $10.8 billion to develop an integrated aluminum industry in the Kingdom of Saudi Arabia. Alcoa and its partners will own 40% of the project and Saudi Arabia will own 60%. "The joint venture will become the world's preeminent and lowest-cost supplier of primary aluminum, alumina and aluminum products, with access to the growing markets of the Middle East and beyond," the companies said. The venture will develop a fully integrated industrial complex, including a bauxite mine, a refinery, an aluminum smelter, a rolling mill and other facilities.

Drugmaker Sanofi-Aventis has agreed to buy U.S. consumer healthcare group Chattem Inc for around $1.9 billion, in a deal which will give Sanofi over-the-counter presence in the United States.

Sanofi said it would start a tender offer for all of Chattem's shares at $93.50 per share in cash. The French group said the offer represented a 34 percent premium above the Chattem's closing share price on December 18.

Gulf Arab nations put into force a monetary pact Tuesday, moving a step closer toward the elusive goal of a single regional currency and greater integration between the mainly oil-rich states.

The announcement by Kuwait's finance minister came as leaders from the six-member Gulf Cooperation Council nations were wrapping up a two-day summit in which they launched a regional electricity project and discussed, among other issues, Iran's nuclear program and the war in Yemen.

Mustafa al-Shimali told Kuwait's official KUNA news agency that the launching of the monetary pact would now allow the governors of the central banks of the six GCC nations to set up "a timetable for the establishment of a regional central bank, with the aim of launching a unified Gulf currency."

The GCC, which groups Kuwait, Saudi Arabia, Qatar, the United Arab Emirates, Oman and Bahrain, has been trying for years to develop a unified currency as part of a push for broader economic integration between their predominantly oil-rich nations.

Rob Hanna: "Option expiration on Friday saw the market rise on exceptionally high volume. Over the last 13 years high volume rises on an up op-ex day have often led to a selloff."

The Oil Drum: "An unlikely source of energy has emerged to meet international demands that the United States do more to fight global warming: It's cleaner than coal, cheaper than oil and a 90-year supply is under our feet.

It's natural gas, the same fossil fuel that was in such short supply a decade ago that it was deemed unreliable. It's now being uncovered at such a rapid pace that its price is near a seven-year low. Long used to heat half the nation's homes, it's becoming the fuel of choice when building new power plants. Someday, it may win wider acceptance as a replacement for gasoline in our cars and trucks."

Citadel Broadcasting the No. 3 U.S. radio broadcaster, files for bankruptcy protection, hoping to convert a $2.1B credit facility into a new term loan of $762.5M, and extinguish $1.4B in debt. Senior lenders would receive a portion of the new loan and 90% of the new common stock in reorganized Citadel.

Nobel Prize-winning economist Joseph Stiglitz warned there's a "significant" chance the U.S. economy will contract in the second half of next year, and urged the government to prepare a second stimulus package to spur job creation.

The holiday shipping rush is expected to peak for UPS today, when the world's largest shipping carrier projects it will deliver about 22 million small packages. For the entire holiday season, UPS plans to deliver roughly 400 million packages worldwide, up slightly from the 2008 holiday season.

There is no syrupy Christmas music blaring inside the massive UPS Worldport hub in Louisville, Ky., only the roar of conveyor belts. Still, workers say they get caught up in the holiday spirit.

UPS, based in Atlanta, hired about 50,000 seasonal workers to keep pace with the extra volume this holiday season, including about 700 extra staff at Worldport. The Louisville facility employs about 10,000 people and sorts up to 350,000 packages hourly. On average, about 1.2 million packages pass through every day. Volume reaches 2.5 million packages at the holiday peak. UPS has other domestic air hubs in Philadelphia, Dallas, Hartford, Conn., Ontario, Calif., Rockford, Ill., and Columbia, S.C., plus a network of international hubs.

Gold for December delivery fell $15.40, or 1.4%, to end at $1,095.40 an ounce on the Comex division of the New York Mercantile Exchange, ending below the $1,100 level for the first time since Nov. 6.
Crude for January delivery, the front-month contract that expires at the end of Monday's trading, ended down 89 cents, or 1.2%, at $72.47 a barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average rose 85.25 points to 10,414.14. The S&P 500 Index added 11.58 points to 1,114.05. The Nasdaq Composite Index gained 25.97 points to 2,237.66.