2/15/03 February Consumer Confidence Fell To A 9 Year Low

The expectations index fell to a 10 year low.

In a recent poll 59% said they'd rather win the lottery than fall in love.

Workers paid 27% more for healthcare in 2002 than they did in 2001.

Since 1970, no sustainable U.S. economic recovery has begun with $30+ crude oil prices. We're now above $35.

China is the second largest user of energy in the world, and is a growing net importer of oil. This places added upward pressure on prices.

The Fed is considering injecting cash into the global economy by buying foreign securities and 30 year bonds. They had better check the calendar first. In five days the U.S. government will not be able to spend any more money. The debt ceiling will need to be raised.

1140 more individuals at Boeing are warned of pending layoffs.

On-line magazine publisher Salon is close to folding.

Floyd E. Bloom, president of the American Association for the Advancement of Science: "the American health system today is in serious crisis. It is failing before our eyes, depite consuming a very significant percentage of our GDP and representing perhaps the biggest employer for most communities. The current system can scarcely meet today's needs, let alone the cost of transition to post-genomic medicine. We are now approaching $700 billion for Medicare and $500 billion for Medicaid. Those mandated entitlements are now approaching 15% of our GDP."

2/14/03 Happy Valentine's Day To My Gang

While I'm on the subject, sex experts say one in five couples are living in a "sexless" marriage and that the numbers are worse in the Silicon Valley. As for the latter, it's possible that too many men invested in stocks when they were $200 per share and now those same stocks are selling for 20 cents per share. That loss may be impinging on performance. If I ever were that greedy, I'd feel pretty inadequate.

In this Harris murder trial she was convicted for running over her husband. When was the last time you watched a truly Jewish woman at work? They do it all the time. They only receive a lifetime of misery.

I was wondering. Do you think the run on duct tape and plastic sheeting will help Home Depot's business?The stock is selling at 15 times duct tape sales.

You have to love Dell. Their storage and server business is going great guns.

Talking about guns, let's get real here. Colin Powell was whining about the Iraqi missiles. The ones they have been describing go 90 miles. The ones they discovered go 113 miles. Are we going to war over 23 miles? That's $1.60. I don't know about Powell but Iraqi missiles get 23 miles to the gallon. At $1.60 per gallon, we're talking war about $1.60. I'll ante up the $1.60 as a good American. We'll call it even.

Japan's economy grew at 0.5%. We have a lot in common with Japan. Hopefully it's not the stock market. Theirs is at or near a 20 year low. If that happens to us, the Dow would be 800. That couldn't happen here. Right?

Bethlehem Steel will layoff 4000 and Ericsson 1200.

Because of lousy January auto sales, overall retail sales were off 0.9%

2/13/03 If The Queen Had.....

N.Korea said that, if provoked, the country is capable of striking U.S. targets anywhere in the world. My response to that is, if the Queen had balls, she'd be king.

Gerald Loeb: "Willingness and ability to hold funds uninvested while awaiting real opportunities is a key to success in the battle for investment survival." In other words, wait until profit potential greatly outweighs the risks.

Crude oil supplies dropped to their lowest levels since 1975, and prices for crude reached their highest point since November 2000. Meanwhile, our strategic oil reserves remain at their highest point while Americans suffer with higher fuel bills.

Healthcare insurance costs jumped 14% in 2002 and are expected to rise 16% this year. 2003 would be the fourth consecutive year of double digit cost increases. The costs in and of themselves reduce hiring. If the costs continue to rise, the extent of layoffs will rise as well.

The Pentagon activated another 40,000 reservists to active duty, bringing the total to 150,252. The Washington Post reports that the U.S. special operations forces were operating in Iraq.

The office of Management & Budget(OMB) claims that the amount of wasteful IT spending in the federal governement is as high as 20% of totsl spending on systems or services, or close to $60 billion. I feel confident that waste in the federal government runs considerably higher than that amount.

Greenspan considers fiscal stimulus premature. He finds it difficult to gauge the health of the economy because of the Iraqi war fears. A field trip to a Wichita bread line might clarify his thinking.

It was like the old days of the cold war with Russia. Now anti-aircraft missiles guard the skies in DC and there police carry gas masks. Americans stockpile, food, water, and medical supplies. All we need now is some bunker building. Linking al-Qaida with Iraq is not in my view a "nightmare" or an "unholy partnership" as decribed by Ari Fleischer. For me it's just a convenient business arrangement. I suggest we get the players to this conflict together at a temple, break some bread, and partake in some chicken soup. It's good for the soul.

2/12/03 The Bread Line

Alan Greenspan tells you what you want to hear. I tell you the unfiltered facts- in your face and down your throat. Wichita, Kansas has 544,000 people in its metropolitan area. It is called the "air capital of the world." There are four major airplane-manufacturing plants plus a wing design facility for Airbus. In the past year and a half 14,200 Wichita aircraft workers have been laid off. An additional 1500 job cuts are expected at Cessna this year due to the fact that Cessna only figures to deliver 220 Citation jets this year, and that's down sharply from the 307 built in 2002. Raytheon laid off 600 last week. Manufacturing accounts for 24% of the jobs in Wichita and aviation makes up about 70% of manufacturing. Bread lines are taking place in Wichita. Just last week 1500 of the jobless stood in line for a loaf of bread at the Bread of Line food bank. These are workers who were making $52,000 a year. They have almost no chance to get another job in Wichita. This is not a soft patch. This is economic devastation. There is not an airplane made in the U.S. that does not have at least one part manufactured in Wichita.

Goldman Sachs sees IT spending dropping 10% this year. Merrill Lynch says it could stay weak well into 2004.

In 2002 the VC industry raised the least amount of funds since 1981.

Nokia to cut 550 jobs.

Cadbury warns of disappointing earnings due to their U.S. operations.

Greenspan: "Signals on the trajectory of the economy as we enter 2003 remain mixed. The few data in hand suggest that the economy has not yet broken out of the pattern of subpar performance experienced over the past year." I guess he knew all along the subpar performance provided signals on the trajectory. As for data, maybe if they were issued with honesty, he wouldn't have trouble reading the economic tea leaves.

Qualcomm announced a stock buyback and a five cent quarterly dividend. It's quite late for the stockholders who have been burned in this stock for the past three years. What a disaster.

2/11/03 Civil Liberties

"Now it is a funny thing about life. If you refuse to accept anything but the best you very often get it. If you utterly decline to make do with what you can get, then somehow or other you are likely to get what you want."
- Somerset Maugham

The 87-page document, "Domestic Security Enhancement Act of 2003," marked "CONFIDENTIAL- NOT FOR DISTRIBUTION" is dated January 9, 2003 and was sent to VP Cheney and House Speaker Hastert. In this document are recommendations to further erode our civil liberties, liberties for which our proud fighting men perished. The war on terrorism is being used as the excuse for the reduction in our civil liberties. The tragedy of 9/11 continues daily. Testing the waters on constitutional guarantees can produce serious ramifications.

Fed Vice Chairman Roger Ferguson: "The impact of war on the U.S. economy is unpredictable. A war is one of those things one simply can't model."

Nobel-prize winning economist Joseph Stieglitz said of the Bush tax plan: "It is inadequate stimulus. It leads to higher deficits and it worsens the problems of inequity."

Consumer confidence in a February poll fell to its lowest level in 25 months. 25% of Americans think the economy will go into a recession. 42% think the economy will slow down, but not go into a recession. At the present time there is no growth. How can it slow down more without going into a recession? Maybe soft patch Greenspan will provide the answer and tell us we are in a goldilocks economy where everything is sugar and nice.

Moody's lowered its ratings yesterday on more than $27 billion of outstanding state of Claifornia bonds. Moody's expects state deficits to persist beyond fiscal 2004. That's a safe prediction. Even a busted clock is right twice a day.

2/10/03 The New Playing Field

As Rumsfeld is busy trash talking and calling Iraq a disgusting enemy, other forces are changing the landscape. The Aministration may talk tough, but Hussein is laughing all the way to the bank. The number one investment over the past year has been the old Iraqi currency, the Dinar. A year ago the exchange rate was 17 to the U.S. dollar, and now it is only 8 to the dollar. In other words, its value vs the dollar has risen over 100%. As the average U.S. driver pays $1.60 per gallon for regular unleaded gasoline, Iraq is coining money with crude at $35 per barrel, and Hussein collects about 10% of those oil receipts for himself. The playing field has turned very green for Iraq. Meanwhile, our dollar continues to fall in value along with the stock market, and our budget deficits get larger and larger. All of this talk of war has enriched Iraq while we get poorer. We are losing a war before the fighting has begun or if it begins at all.

The largest Iraqi exile community in the U.S. is in Detroit. Recreating Iraq will be a daunting mission. As one exile said, "we'll have more than a billion Muslims watching us. Winning the war will be easy. Nation-building is harder. If we mess up, the extremists will come."

WalMart said its sales were soft at the beginning and at the end of the first week of February, and revenue was below plan. Federated Dept Stores sees February same-store sales down 4-5%, and March is expected to drop 3-4%. As I have mentioned in prior blogs, the first quarter will be worse than the Christmas season, and the other shoe may drop going further out.

There have been 7 consecutive negative returns for VC firms. That's what happens when greed works against you, and you have to think to earn a living. The sheep are going to slaughter, and a good percentage of the VC firms will disappear from view. As Robert Ardrie would say, that's the way of life for the survival of the fittest.

Greenspan and his soft patch will go before the Senate tomorrow. He will talk about geo-political risks and other gobbly gook. Most of the networks will carry his talk live. It's a mistake. They should be out there generating ad revenue and doing something productive for their shareowners. It's really too bad. Greenspan is 74, and Ayn Rand would not recognize her disciple.

2/9/03 The Pliability Of Curves

Many have inquired why the U.S. upgraded to an orange alert on Friday. The answer can be found in the curvy and secretive section of the Hajj, the huge annual pilgrimage of two million Muslims to Islam's holy city of Mecca. This religious journey has taken on ominous overtones in most recent years. It was during the 1999 Hajj that bin Laden's mother and brother made it unto Afganistan's state-owned airline in order to visit him while he was sick. To state it bluntly, tracking the movements of terrorists around curvy sections is almost impossible during the Hajj. Hence, the orange alert. It is prudent to be safe rather than sorry.

The same is true for the stock market. Today's consumer debt is higher than at any other point in history. With visibility so dim, it is wise to remain cautious and to pay off margin debt and to invest in only the cream of the crop, and that means not very often.

Consumer spending is slowing dramatically, and saving is more in vogue. This had to come to pass. In December credit card companies wrote off 7 1/2% of credit card receivables. This charge-off level is the second highest ever. So spending must slow down in the future, and this will have a very near-term negative impact on the economy. Over the long-term saving more is a positive.

This is a time to avoid rigidity and to be pliable in one's attitudes. There are so many daily hurdles which, on the surface, may appear impassable. That's almost never true. Unfortunately, depression, feeling scared, and being overwhelmed only magnify the hurdles. As we all know, life can take its toll. The three year bear market has not helped, and has destroyed trillions of dollars of wealth and generated a feeling of fiscal quicksand. I wish I could say that feeling is imagined but it's quite real - with or without threats of war. Today is a day of rest. We can all use it. Our energies need to be rejuvenated for next week's daily battles.

2/8/03 You Can't Fire Who You Don't Hire

The employment report for January said retail employment rose by 101,000. The fact is the hiring was not real. The employees weren't hired in December and therefore weren't fired in January. This is how ridiculous government reporting has become. They call this adjusting data for seasonal variations. I'm a simple guy. I call it bullshit. Aside from retail employment, supposedly the economy added 42,000 other jobs in January. We know this isn't true because over 100,000 net job losses were announced. The December payroll number was adjusted ownward today to show a much larger job loss of 156,000 or 55,000 more than originally stated. It would be so much easier to provide the correct number in the first place and indicate unemployment is rising.

Eurostocks near 6 year lows.

Volvo downbeat on future earnings.

In January the U.S. imported 67% of the oil Iraq exported a day. You still believe there will be a war?

Crude oil is over $35 a barrel, and gas will rise again at the pump.

Stocks declined for the fourth straight week, and have broken the chart support levels.

AIG hits 4 year low and closes at $46.70 or down $23 billion in value for the week. 38-40 looks like an interesting chart support level.

Credit card borrowing fell to a 27-year low in December. As I have been saying, the new trend is to save and not to consume.

2/7/03 Happy Birthday Edward

The Federal government announced they would be cutting 400 jobs. That's like a pimple on an elephant's ass. I was hoping for a number closer to 400,000.

In the journal, Human Production, researchers found progressive motility declined 3.1% each year. In other words, "the data suggest men may become progressively less fertile as they age." In less scientific terms, the sperm swims in circles(like the Wazoo bird) rather than making a mad dash for the female egg. The moral of the story is keep your eye on the ball.

Sears had its 17th straight monthly decline in same-store sales, and that's not easy to deliver! Their first quarter will come in below projections. Federated Dept Stores and J.C. Penney also had lower same-store sales. On the other hand, the leader of the pack, WalMart, had a sales gain of 2.3%. As always, ride the winner.

Bank of England cuts interest rates to the lowest level since 1955. They are trying to spur growth. I give them credit for trying. Hope springs eternal.

The NY Times ran an article stating the U.S. economy is in its worst hiring slump in 20 years. Tell that to Greenspan. He thinks we've hit a soft patch. I know a proctologist who thought that too.

Agilent lowers guidance. This Hewlett Packard spin-off has been a problem from the start.

Chicago topped the nation in job losses in 2002.

Circuit City cut 2000 jobs.

Hispanic births account for more than 50% of the births in California.

In the past couple of weeks gas prices have risen about 20 cents per gallon, and with that, crude oil is selling near a two year high.

Worker productivity in the fourth quarter fell far short of expectations. At some point there are diminishing returns, and we should remember that you can't get blood from a stone.

El Paso, the largest U.S. pipeline company, cut its dividend by 82%.

Dillingham Construction filed for chapter 11.

Too often individuals and/or groups don't appreciate what they have. This can be true in all walks of life. Take the 49ers and Steve Mariucci. Sometimes it takes place in relationships/marriages. Sometimes it happens with stocks. When you have a winner, don't look to see whether the grass is greener across the street. Appreciate what you have. Don't sell WalMart to buy the stock of another competitor. WalMart is probably the best run company in America. Stick with the winner, and don't overtrade. Overtrading can only bring with it losses and disappointments.

2/6/03 The Trend

A month does not go by that I don't remind my readers to make the trend your friend. That's true of the market and also in business. We can learn from companies that do the opposite.

Let's look at Cisco. One money manager recently stated that "Cisco owns the market and they can still afford to charge the premium for the nameplate." How wrong he is. First, the customer cannot afford the premium for the nameplate. Second, Cisco only owns the high end of their market, and that sector is not growing. In fact, it is contracting. Another money manager said "Cisco still believes that price is still not the key issue in the marketplace." Maybe not three years ago, but price is very much a factor today, and the trend is towards saving money on less expensive equipment. For example, Conneticut's Naugatuck Valley Community College replaced Cisco equipment with 28 data switches from Hewlett-Packard and saved $80,000 or 40% over what Cisco would have charged. The savings get greater when we discuss the wins the Chinese manufacturers have provided to their customers. Cisco will pay dearly for ignoring the growing trend to price as a determining factor. The stockholders continue to pay. Cisco stock has dropped over 30% in the past year alone.

It is expected that the U.S. debt limit, currently $6.4 trillion, will be hit Feb. 20. I touched on this subject some weeks back. Now we are two weeks away from the government running out of money. The Congress should not provide a near-term fix to this problem without a plan carved in stone which reduces government expenditures by at least 5%, and that includes providing for funds for Iraq, N. Korea, and all points on the globe! They can start by rescinding the pay raise for all government workers, and then deep cuts in staff members should be included for all members of Congress as well as White House staff. Maybe then the right hand will know what the left hand is doing.

Since the slowdown started in the Silicon Valley, 130,000 jobs have been lost. To put it in perspective, that's the population of Berkeley, Ca.

Last week economic conditions took its toll on the law firm, Brobeck, Phleger and Harrison. This week San Jose-based Skjerven Morrill fell victim. The latter had been in the Silicon Valley for 26 years and specialized in intellectual property disputes. Maybe with less money for R&D, there's less intellectual property. Or maybe the intellectuals have left California and moved to a more tax friendly state- like Ted Turner.

Not all technology companies are in the soup. There's a small, privately-owned company in Bellevue, Wa called AskMe. Last year they doubled revenue, became profitable, and tripled its number of customers( Proctor & Gamble, Ford, Honeywell, Boeing, Network Appliance). The company builds Employee Knowledge Networks and collates information from HR databases, manuals, and case studies written by employees and provides the mechanism by which employees find answers to questions and thus reduce the time employees expend in spinning their wheels in utter frustration. Unlike most other software companies, AskMe is hiring.

2/5/03 Forest Fires

I read an article recently about the Silicon Valley, and an analogy was brought out with respect to forest fires. It was suggested that periodic fires burning underbrush and weaker trees renew the entire forest region, and thus it was explained, allow it to grow and spread again. There wasn't any mention of greed, lack of managerial skills, and China. I suggest they burn the newspaper that printed this article which insults the intelligence of those feeling pain in the Silicon Valley. There are huge amounts of talented individuals without jobs and with little hope of getting a job. I have previously mentioned that one sixth of the area's space is comprised of vacant office buildings etc. There is real hurt there, and re-growth is not around the corner. Retrenchment will be the call for a long long time.

Take Cisco. Please! No one cares that their earnings improved for the past quarter. Their sales were down and Chambers said customers are even more cautious than they were at the beginning of the second quarter, and forecast another possible dip for this period. He sees no quick upturn for tech spending. He's not alone in this view.

Ted Turner will be making a move to Florida near Tallahassee for tax reasons. Florida hasn't any personal state income tax. When and if he sells his AOL stock, that will save him a wad of cash. Good for him.

AIG raises their liability reserves by $2.8 billion.

Germany's unemployment rate rose to a 5 year high.

Once again the dollar is nearing a new 4 year low vs the euro.

Senator Kent Conrad, D-N.D. "the president is taking us into an absolute swamp of deficit and debt...unparalleled in our nation's history." What would someone from ND know from swamps?

There were 132,000 job cuts in January. That's one soft patch.

Blix warns Iraq "it is five minutes to midnight." Does he really think Saddam gives a crap about the time? A little insight into Blix came when he stated "we do not have the same determination on substance as we have on process." I wonder whether he is thinking of dual citizenship and tossing his hat in the ring as a democratic candidate for president. They'll love this guy in NH. There they might be keen on processing rather than the process itself.

2/4/03 20 Inches

Come on now. Let's not go there. This is not an x-rated blog! I'm talking the Columbia. A 20 inch piece of insulation weighing 2.67 pounds peeled off a spot where the orbiter is coupled to the external tank. It was this insulating foam which struck Columbia's left wing during takeoff. Tile damage from insulation had never been a prior a problem, and hence, not considered by NASA engineers.

After 64 days the Venezuelan oil strike is sort of over. Let's say it's fading.

With the consumer's weekend focus on the Columbia tragedy, retail sales at U.S. chain stores were down for the latest week.

American Airlines is burning thru $5 million per day. How long can that continue? The company has $2 billion in unrestricted cash on the balance sheet.

Georgia is set to lose 9000 jobs in 2003. During the past two years the state has lost 123,000 jobs.

Organizers of the Comdex computer trade show filed for chapter 11.

Gold is trading at a 7 year high.

Ericcson's losses widened in the quarter.

Germany's three largest banks will post their first yearly losses since WW II.

U.S. auto sales dropped in January.

The January ISM index dropped from the December level.

For all of you romantics with France on your mind, France's consumer sentiment is at a 5 year low and their unemployment rate is above 9%. France's pension system is shortly to be in a deficit position as the number of retirees swells.

Jean-Pascal Beaufret, Alcatel Sa CFO, "2003 will be a difficult year." Alcatel is eliminating 40% of their workforce!

Does anyone consider how little print coverage there is of the Fed? Greenspan had been on every front page of every newspaper and magazine. He's still very much alive. As I have said so often, the Fed is not the marketplace. The latter is king and not the Fed. Maybe Greenspan will retire to France and wow their economic system.

2/3/03 Economic Debris Sheds Over The U.S.

I had planned to write on this subject yesterday; however, the Columbia tragedy took center stage, and rightly so. Just to set the record straight, I have been up all night, but that doesn't mean I'm cranky. I'm not a moody guy. I don't like it when others insult our intelligence and think it's business as usual.

I'm referring to the $2.23 trillion budget which the President plans to present to Congress. Think about this. Who has a budget of that size for a $10 trillion GDP? Remember please the consumer- that's us- is responsible for at least two-thirds of the GDP. Then healthcare represents another 15%. Those two numbers amount to about $8.2 trillion, and the latter subtracted from $10 trillion leaves only $1.8 trillion. Of the $1.8 trillion a good deal is comprised of services. As you can see, the government essentially generates no GDP. So what are we getting for that $2.23 trillion? Essentially protection via our military. The rest goes to support government agencies and/or appendages. We could eliminate two-thirds of the latter, and not miss a thing. Maybe then we wouldn't expect to see budget deficits for the next ten years. At least that's what the budget office is projecting. Their projections are so pathetic that they are an embarrassment. In fact, this budget is an embarrassment. It is worthless debris scattered over the American public's checkbooks. Wake up and smell the spending. It's rancid. This excessive spending is undermining our sovereignty and our homeland security. Unleashed government spending is a weapon of mass destruction!

2/2/03 Someone Always Has It Worse Than You

The same Ames, Iowa couple who lost their son in the 911 terrorist attack on the World Trade Center mourn the death of their niece, Astronaut Laurel Clark, one of seven astronauts on board Columbia. Whether it was a heat problem, a tile problem, or a wing problem that is the cause, I would like to believe that this country does not require a tragedy to reflect on the value of life. To put matters in perspective, Ilan Ramon's Torah scroll survived the Auschwitz concentration camp, but it was destroyed in the Columbia explosion.

Don Nelson, a longtime NASA supervisor and mission planner going back to the first lunar missions, left NASA four years ago because of grave concerns about its safety program. In August he wrote to President Bush saying it was his "duty to inform you that our space shuttle astronauts are in eminent danger. Your intervention is required to prevent another catastrophic shuttle accident." He received a December 4 reply from the director of the Office of Science and Technology which stated that "NASA places a high priority on safety and has instituted a program of developing and implementing safety upgrades to reduce the risk to space shuttle crews." On December 21 Nelson replied with another letter to the White House and said "I assume that you are aware there never has been a launch vehicle that has not had multiple catastrophic failures."
As we learned yesterday, it only takes one overwhelming failure to produce a national mourning for our space heroes.

2/1/03 Is January Really Over?

For the month of January The Dow dropped 3.5%, the S&P 2.7%, and the Nasdaq 1.1%. Unfortunately, for the most part, it is fair to state as January goes so goes the rest of the year. Yale Hirsch's statistics show that since 1950 the month of January has been the accurate barometer for the remainder of the yesr 92% of the time! There have been only four misses, and I don't believe for one minute that 2003 will be the fifth. I recommend that you plan accordingly, and make the trend your friend and place the percentages in your corner.

The other day I commented on the GDP fourth quarter numbers. I would like to elaborate. Government spending in this quarter rose sharply. Had that not been the case, the GDP number would have been a negative one. I feel very strongly that the government cannot spend our way out of a recession(yes, we are in a recession) and, if they are not prudent, can spend our way into something much more serious.

1/31/03 The Fed

The December minutes of the Fed meeting revealed that partial justification for holding rates steady at that time was the market's late year rally. Using that thinking, then rates should have been lowered on Wednesday. The rally was wiped out by recent losses.

Ray Owens, vice president and senior economist at the Federal Reserve Bank in Richmond, Va said "people reading the economic tea leaves should be encouraged by strong consumer confidence." He must be on ecstasy tea leaves.

Dow Chemical cuts 4000 jobs.

Boeing's profits seen dropping in 2003.

Nikkei at a 20 year low.

eMarketer says the auto industry will account for 27% of all B2B e-commerce transactions by 2004.

According to a study prepared by Dell'Oro Group, global sales of routers will decline for the third consecutive year in 2003, and are forecast to fall 2%.

1/30/03 Sphere Sovereignty

The above words mean decisions should be made whenever and wherever possible at the level closest to those affected by the decision. Unelected and unaccountable government employees ahould not be decision makers for healthcare reform. Consumers must be empowered to have expanded not limited choice. The Federal Employees Health Benefits Program (FEHBP) covers Congress, the White House staff, the federal judiciary, the U.S. postal service, and 9 million federal workers, retirees, and their dependents. It has been mostly successful and quite costly. The taxpayers have been paying for FEHBP. Healthcare must available for all, cost effective, and with on-going choice. Naturally, that's quite a task. So is making available an anti-aids drug cocktail for less than $1 per patient per day. India's Cipla accomplishes that feat, and it's something with which I am quite knowledgeable.

The GDP grew at a 0.7% rate in last year's 4th quarter. Consumer spending increased at a 1% rate for that period- the weakest since the 1st quarter of 1993. There was a 7.3% drop in spending on durable goods, such as, autos, and that was the biggest drop in about 12 years. However, government spending rose at a 4.6% annual rate, and this reflects an increased size and scope of governemnt. Bush campaigned on the theme "my opponent trust goverment, I trust you." With the growing loss of personal freedoms and the lack of fiscal responsibility, I don't believe that campaign slogan could be made today.

Jobless claims pick up again.

Disney's Eisner got a $5 million bonus in 2002. Meanwhile, the Disney stockholders lost their shirts.

Goodyear may trim their workforce.

The 2 month oil strike in Venezuela has forced at least 25,000 companies to go out of business.

Last year Florida's exports to its key Latin American trading partners fell by 25% or almost $4 billion.

Bank One to cut 700 jobs in Chicago.

GM has a 165 day supply of the Saturn LS at its plant in Wilmington, Del. That's double the norm. Chrysler's PT Cruiser has 125 days of inventory. The Ford Focus, Thunderbird, and Mustang have high inventory numbers. The Crown Victoria and the Chevy Astro are seriously overstocked. The list goes on and on. You can expect plant downtimes and lower prices for many vehicles as well as greater incentives. Auto profits will be lower.

Publilius Syrus: "Never promise more than you can perform."

1/29/03 Only 5%

General MacArthur: "Expect only 5% of an intelligence report to be accurate. The trick of a good commander is to isolate the 5%."

That 5% maybe missing in the Bush healthcare plan. It requires senior citizens to enroll in HMOs. The problem- HMOs aren't available in many rural states, such as, Iowa. Medicare currently does not cover any outpatient prescription drug costs for its 41 million enrollees. Right now 4 in 10 seniors have no drug coverage. The number of HMOs willing to insure seniors has dropped from 346 to 153, and continues to drop.

The primary coalition necessary for going to war is to have the backing of the American people. That support comes before a unified front comprised of various nations.

More than 40 states have budget shortfalls totalling $70 billion. "States are facing a perfect storm with deteriorating tax bases, an explosion of health care costs, coupled with a virtual collapse of capital gains tax revenues and corporate profit taxes," said Raymond Scheppach, executive director of the National Governors Association.

This is the first January in 30 years that there hasn't been an IPO.

Durable goods in December rose 0.2%. Economists had predicted an increase of 0.9%.

The FTSE is at a 7 1/2 year low.

The Fed will not change rates today.

The German economics minister lowered his forecast for growth in 2003 to 1%.

AT&T wireless to cut capital spending by 40%.

Nikkei at an 11 week low.

Consumer confidence fell two points to 79, a very weak showing.

Earthlink to cut 25% of its workers.

Apple cuts Power Mac prices.

White House Budget Director Mitchell Daniels said the deficits for 2003 and 2004 would excced $300 billion. In July a deficit of $109 billion and $48 billion in 2004 had been projected. Daniels said the White House will no longer provide 10 year budget projections. Why? Daniels said "these numbers are meaningless. There never was a $5.6 trillion surplus; not even close." In other words, what comes out of the White House budget office is a figment of their own imagination. Imagine this!!!!!!

1/28/03 "Trust Is A Crucial Commodity"

These words were spoken by Colin Powell on Sunday before an international gathering of leaders in Davos, Switzerland. He might have included sound judgment and street smarts. No one seriously doubts that the U.S will release intelligence data on Iraqi weapons concealment and will show the direct link of Iraq to al Qaeda. Whether it's revealed today or next week is irrelevant. What isn't irrelevant is tonight's State of the Union address. There will be soaring rhetoric reminiscent of Churchill, Lincoln, Truman, and the Scriptures. Memorable words don't deliver results. Departments like Homeland Security can be initiated but the lack of infrastructure undermines success. In other words, there might have been four dress rehearsals for this speech and great preparation but there is a big gap between the lip and the cup, as it were. What does axis of evil mean? Every time I hear it spoken I cringe. Why? Little progress has happened but lots of talk. Hopefully there will be tangible improvements coming our way.

Merrill Lynch's chief strategist said technology shares should remain "significantly underweighted" due to evidence that capital spending expectations may be too optimistic.

The Dow closed below 8000 for the first time since Oct. 14.

Freddie Mac earnings below expectations.

Surveys show 4 out of 5 Europeans think the quality of healthcare stagnated or declined over the past decade.

Cross border pharmacies are the rage. There are at least 80 Canadian companies in the business. Simply put, Canada regulates drug prices. What the market will bear dictates prices in the U.S.

Pfizer Chairman and CEO McKinnell: "with a differing set of incentives the system can produce better outcomes at significantly lower costs." I don't see anyone stopping the drug companies from doing that- with the possible exception of greed.

2002 home sales rose 5% to a record 5.56 million homes.

Fujitsu cuts forecast.

1/27/03 "There's A Sausage Machine On Capitol Hill"

Before I get into the meat of this morning's blog, I want to make a sincere apology. It appears that my daily musings are making many of my readers depressed. That certainly is not my intention. In fact, I have always believed knowing the facts is uplifting and a great way to start the day- a little like the breakfast of champions. Now I could change the recipe, and dilute the truth, but then you wouldn't respect my independent thinking. So let's start fresh today. I will not say one word about unemployment, consumer sentiment, or economic malaise.

White House chief of staff Andrew Card: "There's a sausage machine on Capitol Hill. We gave the sausage machine all the right ingredients, they have to churn, and I'm confident that when they turn that sausage out, it'll be the right kind of sausage for America." Will it be vegetarian sausage or organic? I, for one, am always interested in creative recipes. Maybe Andrew Card could be a guest on the Food Network.

Martha Stewart: "I'm real lucky, because I am able to sort of compartmentalize. I can be concerned on one hand, and be productive on the other hand...I can still sleep." Maybe her nickname should be multi-task.

The drought sweeping the West is the worst in more than a century. Some scientists say it rivals the meanest dry spells of the past 1400 years! In some places for the past year and a half there hasn't been enough rain even to measure.

70% of those polled believe a war with Iraq will hurt the U.S. economy. Maybe a creative stimulus plan is not to go to war.

It is estimated that each year states are losing at least $12 billion in taxes on e-commerce and catalog purchases on the internet.

European stocks are at their lowest level in about 6 years. The FTSE is below 3500.

Gold is at $372 and 30% higher than a year ago.

The Euro is at $1.09 vs the dollar.

Crude oil is trading at $33.50 per barrel.

Microsoft's Gates says he does not expect a big pick-up in tech spending over the next 2 or 3 years.

Blix to say Iraq failed to fully comply with the UN resolution. What a revelation!

The Packard Foundation provided $616 million in grants in 2000. This year the expectation is for $200 million.

Ellison says Oracle's stock is undervalued. If so, why isn't he out there buying the shares in the marketplace? Maybe he should talk less, and spend more time trying to build revenue.