3/22/03 The Market Climbs A Wall Of Lessening War Worries
The major market indices are now up for the year. The Dow and the S&P 500 were up for th eight straight day, and the Dow had its biggest weekly percentage gain since 1982. The heroes on Wall Street are our brave at-risk men and women fighting on the Iraqi sands. They made the rally possible- not the meager profits and cash flow on Main Street. The rally spilled over to the UK and Japan.
All were not smiling. Gold dropped to $326 and oil declined to $26.75 as the Iraqi oil fields were secured. Over the coming weeks pump prices should drop 40 cents per gallon. Ten year treasury notes had their biggest weekly drop in 2 years, and the yield rose above 4%. You can look for mortgage rates to rise accordingly. The refinancing shot in the arm for consumer spending is history. You can count on that. In addition, you can expect mortgage companies to have lay-offs. Their refinancing activity will lessen, and they will need to lower their overhead.
Now for a dose of reality.
Sonicblue filed for bankruptcy.
Hawaiian Airlines filed for bankruptcy.
LapLink filed for bankruptcy.
Northwest Airlines to cut 4900 jobs.
Boeing lays off close to another 1000 workers. The Hawaiian Air bankruptcy will further hurt Boeing.
Microsoft director Jon Shirley sold 1.51 million Microsoft shares. He was a former president and COO at Microsoft. He and his family continue to hold 9.3 million Microsoft shares.
An Illinois judge ordered Philip Morris to pay $10 billion in damages.
Intuit shares dropped over 20% after warning about growth prospects.
Durable goods orders will show a drop in February and the consumer confidence index will decline some more. The victory rally will not entice businesses to order more goods or for them to hire additional workers.
Santa Clara County has lost over 50,000 jobs since the start of the new year. That number will continue to rise.
Now the good news.
We are in the process of bringing non-tyrannical rule to the neighborhoods in Iraq with the coalition of 46 willing allied nations.
Yao Ming knocked down the first 3-pointer of his career.
Bush tax cuts survived in the Senate and House budgets.
Friday, March 21, 2003
3/21/03 News From The Front Outshines The Downbeat Economic Arena
A happy and healthy and safe Spring to everyone!
U.S. February leading economic indicators fell 0.4%.
The Philly Fed index fell to –8.0 from 2.3 in February. New orders plunged to –4.3 from 14.1 while the employment index hit a 7-month low of –8.8. A third of the firms say they’ve delayed hiring this year.
President Bush: The war may be “longer and more difficult than some predict.”
Solectron to cut 12,000 jobs.
Gold at $333 and at the lowest level in 3 months.
Thirty oil wells are burning in Southern Iraq.
Oliver Wendell Holmes: “What lies behind us and what lies before us are tiny matters compared to what lies within us.”
The state of Texas completed its 300th execution. Milestones like these we could do without.
We could put our anti-war protests to much better use. Yesterday 1,000 demonstrators where arrested in San Francisco. Maybe we should consider eliminating all purchases of goods manufactured in France. Here is a country that voted for UN Resolution 1441 and then stabbed our country in the back via the threat of veto. If France cannot stick to a deal, then we should not buy their products. I for one will not longer purchase any item made in France.
After we successfully liberate Iraq, I strongly suggest we bring democracy to Iran, the mother and creator of terrorism. It was Iran who has harbored Osama ben Laden. Iran is the crown jewel of the Middle East and the people are demonstrating in the streets against the present regime.
A happy and healthy and safe Spring to everyone!
U.S. February leading economic indicators fell 0.4%.
The Philly Fed index fell to –8.0 from 2.3 in February. New orders plunged to –4.3 from 14.1 while the employment index hit a 7-month low of –8.8. A third of the firms say they’ve delayed hiring this year.
President Bush: The war may be “longer and more difficult than some predict.”
Solectron to cut 12,000 jobs.
Gold at $333 and at the lowest level in 3 months.
Thirty oil wells are burning in Southern Iraq.
Oliver Wendell Holmes: “What lies behind us and what lies before us are tiny matters compared to what lies within us.”
The state of Texas completed its 300th execution. Milestones like these we could do without.
We could put our anti-war protests to much better use. Yesterday 1,000 demonstrators where arrested in San Francisco. Maybe we should consider eliminating all purchases of goods manufactured in France. Here is a country that voted for UN Resolution 1441 and then stabbed our country in the back via the threat of veto. If France cannot stick to a deal, then we should not buy their products. I for one will not longer purchase any item made in France.
After we successfully liberate Iraq, I strongly suggest we bring democracy to Iran, the mother and creator of terrorism. It was Iran who has harbored Osama ben Laden. Iran is the crown jewel of the Middle East and the people are demonstrating in the streets against the present regime.
Thursday, March 20, 2003
3/20/03 In War Decapitation Is A Good Thing
In war, when liberating, it is better to be feared. When occupying, a little love can't hurt. It is important that the American people have a unified and supportive voice for our at-risk troops and our President.
A question to ponder: what has more visibility- the U.S. economy or an Iraqi sandstorm?
In response to yesterday's blog, several questioned the significance of the derivatives market. Let me clarify the situation. In 2002 the aggregate value of the turnover in exchange-traded financial derivatives rose by 17% to $694 trillion or about 70 times our GDP. The business in stock index contracts grew by 32% to $64 trillion and interest rate and currency derivatives grew by 20% to $100 trllion. Hopefully, the matter of significance has been put to bed!
From January 2001 to January 2003 the nation's high-tech industry reduced its workforce by about 600,000 to approximately 5 million jobs. I anticipate further reductions.
If you use the AAA credit card, you get a 5% rebate on gasoline and diesel purchaes.
Alan Greenspan: "Deficit spending is simply a scheme for the hidden confiscation of wealth."
The Fed can't assess the outlook or balance the risks between economic weakness and inflation. They must be standing in the Iraqi sandstorm. I anticipate in time the Fed will buy back government securities with the objective of injecting funds into the economy.
Housing construction dropped 11% in February and specifically the number of single family homes started in February declined by almost 14%.
Within a matter of days the President will ask Congress for funds to pay for the Iraqi war. The figure will assume at least one month of combat. The 1991 Persian Gulf War cost $61 billion or $80 billion in today's dollars and there were 39 days of an air campaign. All but $7 billion was reimbursed by other countries.
It has been exactly one month since the government reached the debt ceiling limit. How have financial obligations been met during this time? Would the Congress or the Administration kindly let the American people in on this "overlooked" situation.
Iraq has an estimated 112.5 billion barrels of proven oil reserves.
It's like the old days. SoundView upped their target price for EBay to $100 and on Amazon to $30.
Crude oil fell below $29 per barrel to a three month low.
The Dow closed up for the 6th straight day, the FTSE for the 5th, and the Nikkei closed at a two week high.
Denver has the worst snow storm in 20 years.
The Iraqi dinar has collapsed to 3100 to the dollar. Bottled water, ear plugs, and face masks are in strong demand.
Allianz reported its first loss since WW II.
Continental Air will cut 1200 jobs.
For the second day in a row I am apologizing for being wrong. After 7 months of negotiating, I did not believe we would go to war. That's how little I know. When I'm wrong, I am really wrong. I don't do anything halfway.
In war, when liberating, it is better to be feared. When occupying, a little love can't hurt. It is important that the American people have a unified and supportive voice for our at-risk troops and our President.
A question to ponder: what has more visibility- the U.S. economy or an Iraqi sandstorm?
In response to yesterday's blog, several questioned the significance of the derivatives market. Let me clarify the situation. In 2002 the aggregate value of the turnover in exchange-traded financial derivatives rose by 17% to $694 trillion or about 70 times our GDP. The business in stock index contracts grew by 32% to $64 trillion and interest rate and currency derivatives grew by 20% to $100 trllion. Hopefully, the matter of significance has been put to bed!
From January 2001 to January 2003 the nation's high-tech industry reduced its workforce by about 600,000 to approximately 5 million jobs. I anticipate further reductions.
If you use the AAA credit card, you get a 5% rebate on gasoline and diesel purchaes.
Alan Greenspan: "Deficit spending is simply a scheme for the hidden confiscation of wealth."
The Fed can't assess the outlook or balance the risks between economic weakness and inflation. They must be standing in the Iraqi sandstorm. I anticipate in time the Fed will buy back government securities with the objective of injecting funds into the economy.
Housing construction dropped 11% in February and specifically the number of single family homes started in February declined by almost 14%.
Within a matter of days the President will ask Congress for funds to pay for the Iraqi war. The figure will assume at least one month of combat. The 1991 Persian Gulf War cost $61 billion or $80 billion in today's dollars and there were 39 days of an air campaign. All but $7 billion was reimbursed by other countries.
It has been exactly one month since the government reached the debt ceiling limit. How have financial obligations been met during this time? Would the Congress or the Administration kindly let the American people in on this "overlooked" situation.
Iraq has an estimated 112.5 billion barrels of proven oil reserves.
It's like the old days. SoundView upped their target price for EBay to $100 and on Amazon to $30.
Crude oil fell below $29 per barrel to a three month low.
The Dow closed up for the 6th straight day, the FTSE for the 5th, and the Nikkei closed at a two week high.
Denver has the worst snow storm in 20 years.
The Iraqi dinar has collapsed to 3100 to the dollar. Bottled water, ear plugs, and face masks are in strong demand.
Allianz reported its first loss since WW II.
Continental Air will cut 1200 jobs.
For the second day in a row I am apologizing for being wrong. After 7 months of negotiating, I did not believe we would go to war. That's how little I know. When I'm wrong, I am really wrong. I don't do anything halfway.
Wednesday, March 19, 2003
3/19/03 The Defiant World Financial System
All the major financial markets have been hanging in a downward bias balance for several years, and, in the case of Japan, for about 14 arduous years. Many blame it on financial bubbles. There is some basis for that statement; however, it is much much too simplistic. It's truly the core of various financial systems peculiar to each of the major industrialized countries.
Toshihiko Fukui, Bank of Japan Governor-designate, yesterday told a parliamentary committee that the Japanese government may need to inject public money into banks to head off a financial crisis. The banking industry has 53 trillion yen in bad loans. This message was similar to the one I mentioned in yesterday's blog pertaining to the Deutsche Bank warning the German government about the possible collapse of the largest German banks. Then we have the State-controlled banks in China with their bad loans of about $600 billion and unfunded pension liabilities from defunct state companies which total another $600 billion. If the present GDP growth rate in China should slow down, the bad loans and unfunded pension liabilities could undermine the stability of their economy. With the stagnation in the U.S. economy, I think it is safe to state the GDP growth rate in China will lessen, and possibly greatly.
Finally, we come to the matter of derivatives in the U.S. markets which Warren Buffett and Bill Fleckenstein recently mentioned. Unfortunately, few professionals understand the complexity of derivatives and their possible violent impact on the financial markets. The fact is we have a mountain of derivatives outstanding. It would not take very much for those derivatives to initiate a landslide of financial ruin. One never knows how the banking problems in Germany and Japan and the above mentioned problems in China could help get the derivative ball careening out of control. It wouldn't be a pretty sight. The aftermath would be a great deal worse than what Iraq would look like after a night of smart bombs hitting the butts of camels.
On August 29, 1997 Alan Greenspan spoke in Jackson Hole, Wyoming and said that "the future as we all know is uncertain and hence all investments are risky." That risk level is much higher today than it was in 1997. The higher the risk the less one should pay for an investment when confronting that risk. I continue to believe that the current investment environment doesn't adequately reward those entertaining this risk level. As such, as I have said so often over the past three years, it would be wise to reduce investment exposure, and that includes long term and intermediate government bonds. Given the current fragility of our financial system, the yield on our government bonds in no way equates to the risk of owning them. In fact, if I were not a true blue patriot, I would suggest shorting our bonds as I have suggested in the past with our dollar. I know we need to attract $1.6 billion daily from the outside into our financial system. I wouldn't want to say anything which might hurt that daily importation.
At some point in the next six months I expect we will encounter a force which will rock our financial markets, and not for one day or one week. When that will happen or if it will happen, no one knows. The good news is I was wrong yesterday. I had predicted the Fed would lower rates, and they didn't. I could be wrong about this pending crisis too. But, I'm never willing to bet against my instincts.
Crude oil had its biggest drop in 16 months, and crude fell to its lowest price in 3 months.
BellSouth will cut 1077 jobs, Boeing 400 jobs, Gulfstream up to 1000 jobs, Charming Shoppes 285, BAE to cut a further 1000 jobs in the UK, and overall, it should be noted that 236,000 tech jobs were lost in 2002.
UAL says that liquidation is a "distinct possibility".
Mark Danner: "Terrorism is the new communism."
Thomas Petzinger, Jr, WSJ: "In a transparent marketplace, when everyone knows everyone's prices, the price of everything trends downward."
All the major financial markets have been hanging in a downward bias balance for several years, and, in the case of Japan, for about 14 arduous years. Many blame it on financial bubbles. There is some basis for that statement; however, it is much much too simplistic. It's truly the core of various financial systems peculiar to each of the major industrialized countries.
Toshihiko Fukui, Bank of Japan Governor-designate, yesterday told a parliamentary committee that the Japanese government may need to inject public money into banks to head off a financial crisis. The banking industry has 53 trillion yen in bad loans. This message was similar to the one I mentioned in yesterday's blog pertaining to the Deutsche Bank warning the German government about the possible collapse of the largest German banks. Then we have the State-controlled banks in China with their bad loans of about $600 billion and unfunded pension liabilities from defunct state companies which total another $600 billion. If the present GDP growth rate in China should slow down, the bad loans and unfunded pension liabilities could undermine the stability of their economy. With the stagnation in the U.S. economy, I think it is safe to state the GDP growth rate in China will lessen, and possibly greatly.
Finally, we come to the matter of derivatives in the U.S. markets which Warren Buffett and Bill Fleckenstein recently mentioned. Unfortunately, few professionals understand the complexity of derivatives and their possible violent impact on the financial markets. The fact is we have a mountain of derivatives outstanding. It would not take very much for those derivatives to initiate a landslide of financial ruin. One never knows how the banking problems in Germany and Japan and the above mentioned problems in China could help get the derivative ball careening out of control. It wouldn't be a pretty sight. The aftermath would be a great deal worse than what Iraq would look like after a night of smart bombs hitting the butts of camels.
On August 29, 1997 Alan Greenspan spoke in Jackson Hole, Wyoming and said that "the future as we all know is uncertain and hence all investments are risky." That risk level is much higher today than it was in 1997. The higher the risk the less one should pay for an investment when confronting that risk. I continue to believe that the current investment environment doesn't adequately reward those entertaining this risk level. As such, as I have said so often over the past three years, it would be wise to reduce investment exposure, and that includes long term and intermediate government bonds. Given the current fragility of our financial system, the yield on our government bonds in no way equates to the risk of owning them. In fact, if I were not a true blue patriot, I would suggest shorting our bonds as I have suggested in the past with our dollar. I know we need to attract $1.6 billion daily from the outside into our financial system. I wouldn't want to say anything which might hurt that daily importation.
At some point in the next six months I expect we will encounter a force which will rock our financial markets, and not for one day or one week. When that will happen or if it will happen, no one knows. The good news is I was wrong yesterday. I had predicted the Fed would lower rates, and they didn't. I could be wrong about this pending crisis too. But, I'm never willing to bet against my instincts.
Crude oil had its biggest drop in 16 months, and crude fell to its lowest price in 3 months.
BellSouth will cut 1077 jobs, Boeing 400 jobs, Gulfstream up to 1000 jobs, Charming Shoppes 285, BAE to cut a further 1000 jobs in the UK, and overall, it should be noted that 236,000 tech jobs were lost in 2002.
UAL says that liquidation is a "distinct possibility".
Mark Danner: "Terrorism is the new communism."
Thomas Petzinger, Jr, WSJ: "In a transparent marketplace, when everyone knows everyone's prices, the price of everything trends downward."
3/19/03 The Defiant World Financial System
All the major financial markets have been hanging in a downward bias balance for several years, and, in the case of Japan, for about 14 arduous years. Many blame it on financial bubbles. There is some basis for that statement; however, it is much much too simplistic. It's truly the core of various financial systems peculiar to each of the major industrialized countries.
Toshihiko Fukui, Bank of Japan Governor-designate, yesterday told a parliamentary committee that the Japanese government may need to inject public money into banks to head off a financial crisis. The banking industry has 53 trillion yen in bad loans. This message was similar to the one I mentioned in yesterday's blog pertaining to the Deutsche Bank warning the German government about the possible collapse of the largest German banks. Then we have the State-controlled banks in China with their bad loans of about $600 billion and unfunded pension liabilities from defunct state companies which total another $600 billion. If the present GDP growth rate in China should slow down, the bad loans and unfunded pension liabilities could undermine the stability of their economy. With the stagnation in the U.S. economy, I think it is safe to state the GDP growth rate in China will lessen, and possibly greatly.
Finally, we come to the matter of derivatives in the U.S. markets which Warren Buffett and Bill Fleckenstein recently mentioned. Unfortunately, few professionals understand the complexity of derivatives and their possible violent impact on the financial markets. The fact is we have a mountain of derivatives outstanding. It would not take very much for those derivatives to initiate a landslide of financial ruin. One never knows how the banking problems in Germany and Japan and the above mentioned problems in China could help get the derivative ball careening out of control. It wouldn't be a pretty sight. The aftermath would be a great deal worse than what Iraq would look like after a night of smart bombs hitting the butts of camels.
On August 29, 1997 Alan Greenspan spoke in Jackson Hole, Wyoming and said that "the future as we all know is uncertain and hence all investments are risky." That risk level is much higher today than it was in 1997. The higher the risk the less one should pay for an investment when confronting that risk. I continue to believe that the current investment environment doesn't adequately reward those entertaining this risk level. As such, as I have said so often over the past three years, it would be wise to reduce investment exposure, and that includes long term and intermediate government bonds. Given the current fragility of our financial system, the yield on our government bonds in no way equates to the risk of owning them. In fact, if I were not a true blue patriot, I would suggest shorting our bonds as I have suggested in the past with our dollar. I know we need to attract $1.6 billion daily from the outside into our financial system. I wouldn't want to say anything which might hurt that daily importation.
At some point in the next six months I expect we will encounter a force which will rock our financial markets, and not for one day or one week. When that will happen or if it will happen, no one knows. The good news is I was wrong yesterday. I had predicted the Fed would lower rates, and they didn't. I could be wrong about this pending crisis too. But, I'm never willing to bet against my instincts.
Crude oil had its biggest drop in 16 months, and crude fell to its lowest price in 3 months.
BellSouth will cut 1077 jobs, Boeing 400 jobs, Gulfstream up to 1000 jobs, Charming Shoppes, BAE to cut a further 1000 jobs in the UK, and overall, it should be noted that 236,000 tech jobs were lost in 2002.
UAL says that liquidation is a "distinct possibility".
Mark Danner: "Terrorism is the new communism."
Thomas Petzinger, Jr, WSJ: "In a transparent marketplace, when everyone knows everyone's prices, the price of everything trends downward."
All the major financial markets have been hanging in a downward bias balance for several years, and, in the case of Japan, for about 14 arduous years. Many blame it on financial bubbles. There is some basis for that statement; however, it is much much too simplistic. It's truly the core of various financial systems peculiar to each of the major industrialized countries.
Toshihiko Fukui, Bank of Japan Governor-designate, yesterday told a parliamentary committee that the Japanese government may need to inject public money into banks to head off a financial crisis. The banking industry has 53 trillion yen in bad loans. This message was similar to the one I mentioned in yesterday's blog pertaining to the Deutsche Bank warning the German government about the possible collapse of the largest German banks. Then we have the State-controlled banks in China with their bad loans of about $600 billion and unfunded pension liabilities from defunct state companies which total another $600 billion. If the present GDP growth rate in China should slow down, the bad loans and unfunded pension liabilities could undermine the stability of their economy. With the stagnation in the U.S. economy, I think it is safe to state the GDP growth rate in China will lessen, and possibly greatly.
Finally, we come to the matter of derivatives in the U.S. markets which Warren Buffett and Bill Fleckenstein recently mentioned. Unfortunately, few professionals understand the complexity of derivatives and their possible violent impact on the financial markets. The fact is we have a mountain of derivatives outstanding. It would not take very much for those derivatives to initiate a landslide of financial ruin. One never knows how the banking problems in Germany and Japan and the above mentioned problems in China could help get the derivative ball careening out of control. It wouldn't be a pretty sight. The aftermath would be a great deal worse than what Iraq would look like after a night of smart bombs hitting the butts of camels.
On August 29, 1997 Alan Greenspan spoke in Jackson Hole, Wyoming and said that "the future as we all know is uncertain and hence all investments are risky." That risk level is much higher today than it was in 1997. The higher the risk the less one should pay for an investment when confronting that risk. I continue to believe that the current investment environment doesn't adequately reward those entertaining this risk level. As such, as I have said so often over the past three years, it would be wise to reduce investment exposure, and that includes long term and intermediate government bonds. Given the current fragility of our financial system, the yield on our government bonds in no way equates to the risk of owning them. In fact, if I were not a true blue patriot, I would suggest shorting our bonds as I have suggested in the past with our dollar. I know we need to attract $1.6 billion daily from the outside into our financial system. I wouldn't want to say anything which might hurt that daily importation.
At some point in the next six months I expect we will encounter a force which will rock our financial markets, and not for one day or one week. When that will happen or if it will happen, no one knows. The good news is I was wrong yesterday. I had predicted the Fed would lower rates, and they didn't. I could be wrong about this pending crisis too. But, I'm never willing to bet against my instincts.
Crude oil had its biggest drop in 16 months, and crude fell to its lowest price in 3 months.
BellSouth will cut 1077 jobs, Boeing 400 jobs, Gulfstream up to 1000 jobs, Charming Shoppes, BAE to cut a further 1000 jobs in the UK, and overall, it should be noted that 236,000 tech jobs were lost in 2002.
UAL says that liquidation is a "distinct possibility".
Mark Danner: "Terrorism is the new communism."
Thomas Petzinger, Jr, WSJ: "In a transparent marketplace, when everyone knows everyone's prices, the price of everything trends downward."
Tuesday, March 18, 2003
3/18/03 Hit A Camel In The Butt
George W. Bush: "What's the use of sending a $2 million missile into a $10 tent to hit a camel in the butt?"
The housing market index plunged to 52 from 62 in February, and the index was the lowest since 2001.
Applied Materials cuts 2000 jobs or 14% of its staff, and Gateway cuts 1400 workers.
Spiegel files for bankruptcy.
As I mentioned some weeks ago, P&G to buy Wella for $5.9 billion.
The steepness of the yield curve indicates that economic growth is expected to pick up. I question this thinking.
Merrill Lynch: "Equity investors should continue to sell into rallies. We continue to believe that there is considerable more downside risk than upside risk to the equity market." For three years I have been saying that investors should use rallies as selling opportunities. I continue to believe this is the correct action to take.
German insurer Allianz faces a $16 billion euro capital deficit.
Easter falls on April 20-three weeks later than last year. Retail sales will be pushed back into April rather than into March.
The European Commission cut its growth forecast for the 12 Euro countries to 1%. The Commission said the euro economy may shrink in this year's first quarter.
The CEO of the Deutsche Bank warned the German government to prepare a bailout plan for the nation's banks. Major banks have not failed in Germany since the depression.
Medicare's insolvency rate moved up four years to 2026. The date will continue to get closer.
Jed Babbin, former deputy undersecretary of defense in the first Bush Administration, "Going to war without France is like going deer hunting without an accordian. You just leave a lot of useless noisy baggage behind."
There were 141 million wireless(cell) subscribers at the end of 2002, and total wireless minutes grew 36% over 2001 usage. It is estimated that wireless data revenue for 2003 will exceed $1 billion.
Crude oil posts 10% drop, the biggest decline since September 2001.
George W. Bush: "What's the use of sending a $2 million missile into a $10 tent to hit a camel in the butt?"
The housing market index plunged to 52 from 62 in February, and the index was the lowest since 2001.
Applied Materials cuts 2000 jobs or 14% of its staff, and Gateway cuts 1400 workers.
Spiegel files for bankruptcy.
As I mentioned some weeks ago, P&G to buy Wella for $5.9 billion.
The steepness of the yield curve indicates that economic growth is expected to pick up. I question this thinking.
Merrill Lynch: "Equity investors should continue to sell into rallies. We continue to believe that there is considerable more downside risk than upside risk to the equity market." For three years I have been saying that investors should use rallies as selling opportunities. I continue to believe this is the correct action to take.
German insurer Allianz faces a $16 billion euro capital deficit.
Easter falls on April 20-three weeks later than last year. Retail sales will be pushed back into April rather than into March.
The European Commission cut its growth forecast for the 12 Euro countries to 1%. The Commission said the euro economy may shrink in this year's first quarter.
The CEO of the Deutsche Bank warned the German government to prepare a bailout plan for the nation's banks. Major banks have not failed in Germany since the depression.
Medicare's insolvency rate moved up four years to 2026. The date will continue to get closer.
Jed Babbin, former deputy undersecretary of defense in the first Bush Administration, "Going to war without France is like going deer hunting without an accordian. You just leave a lot of useless noisy baggage behind."
There were 141 million wireless(cell) subscribers at the end of 2002, and total wireless minutes grew 36% over 2001 usage. It is estimated that wireless data revenue for 2003 will exceed $1 billion.
Crude oil posts 10% drop, the biggest decline since September 2001.
3/18/03 Hit A Camel In The Butt
George W. Bush: "What's the use of sending a $2 million missile into a $10 tent to hit a camel in the butt?"
The housing market index plunged to 52 from 62 in February, and the index was the lowest since 2001.
Applied Materials cuts 2000 jobs or 14% of its staff, and Gateway cuts 1400 workers.
Spiegel files for bankruptcy.
As I mentioned some weeks ago, P&G to buy Wella for $5.9 billion.
The steepness of the yield curve indicates that economic growth is expected to pick up. I question this thinking.
Merrill Lynch: "Equity investors should continue to sell into rallies. We continue to believe that there is considerable more downside risk than upside risk to the equity market." For three years I have been saying that investors should use rallies as selling opportunities. I continue to believe this is the correct action to take.
German insurer Allianz faces a $16 billion euro capital deficit.
Easter falls on April 20-three weeks later than last year. Retail sales will be pushed back into April rather than into March.
The European Commission cut its growth forecast for the 12 Euro countries to 1%. The Commission said the euro economy may shrink in this year's first quarter.
The CEO of the Deutsche Bank warned the German government to prepare a bailout plan for the nation's banks. Major banks have not failed in Germany since the depression.
Medicare's insolvency rate moved up four years to 2026. The date will continue to get closer.
Jed Babbin, former deputy undersecretary of defense in the first Bush Administration, "Going to war without France is like going deer hunting without an accordian. You just leave a lot of useless noisy baggage behind."
There were 141 million wireless(cell) subscribers at the end of 2002, and total wireless minutes grew 36% over 2001 usage. It is estimated that wireless data revenue for 2003 will exceed $1 billion.
Crude oil posts 10% drop, the biggest decline since September 2001.
George W. Bush: "What's the use of sending a $2 million missile into a $10 tent to hit a camel in the butt?"
The housing market index plunged to 52 from 62 in February, and the index was the lowest since 2001.
Applied Materials cuts 2000 jobs or 14% of its staff, and Gateway cuts 1400 workers.
Spiegel files for bankruptcy.
As I mentioned some weeks ago, P&G to buy Wella for $5.9 billion.
The steepness of the yield curve indicates that economic growth is expected to pick up. I question this thinking.
Merrill Lynch: "Equity investors should continue to sell into rallies. We continue to believe that there is considerable more downside risk than upside risk to the equity market." For three years I have been saying that investors should use rallies as selling opportunities. I continue to believe this is the correct action to take.
German insurer Allianz faces a $16 billion euro capital deficit.
Easter falls on April 20-three weeks later than last year. Retail sales will be pushed back into April rather than into March.
The European Commission cut its growth forecast for the 12 Euro countries to 1%. The Commission said the euro economy may shrink in this year's first quarter.
The CEO of the Deutsche Bank warned the German government to prepare a bailout plan for the nation's banks. Major banks have not failed in Germany since the depression.
Medicare's insolvency rate moved up four years to 2026. The date will continue to get closer.
Jed Babbin, former deputy undersecretary of defense in the first Bush Administration, "Going to war without France is like going deer hunting without an accordian. You just leave a lot of useless noisy baggage behind."
There were 141 million wireless(cell) subscribers at the end of 2002, and total wireless minutes grew 36% over 2001 usage. It is estimated that wireless data revenue for 2003 will exceed $1 billion.
Crude oil posts 10% drop, the biggest decline since September 2001.
Monday, March 17, 2003
3/17/03 The Party's Over. Turn Off The Lights
Over the past six plus months the American public has been watching a real life reality show on a world wide screen. Unlike other reality shows, this one has been a true extravaganza and very costly. We have been successful in alienating more countries in the shortest time possible. This requires both a lack of negotiating skill and a limited appreciation of friendship, loyalty, trust, and respect. What will be the cost? The White House and the Pentagon have refused to provide Congress with any viable estimates about the cost of war with Iraq or the post-war reconstruction of Iraq. In fact, members of the Administration as well as the President have been asked questions on the above mentioned costs and no answers have been forthcoming. Senator Chuck Hagel, Republican-Nebraska, said "That does not encourage a great amount of trust and cooperation."
Nikita Khrushchev: "We were simply trying to remind other countries that we were powerful and deserved respect, and that we wouldn't tolerate being talked to in the language of ultimatums."
Bruce Nussbaum, Editorial page editor of Business Week: "The price the Bush Administration is paying for its failed diplomacy is high, and it promises to rise even further. A world divided between multilateral economic and unilateral security policies is an uncertain and risky place. It is not likely to encourage economic growth or prosperity. The Administration risks turning what was once trumpeted as the American Century into the Anti-American Century."
You can blame it on the weather, but the weather hasn't been horrible for the past six months. You can blame it on Iraq, N. Korea, or any other geopolitical arena, but that would be a poor explanation for the low level of business investment, the low level of consumer confidence, a growing number of world-wide layoffs, rising government debt burdens, a debt ceiling reached early in the calendar year, and a stock market which continues into its fourth year of a downward trend. The geopolitical environment cannot explain away increased foreign competition, lack of pricing power, underfunded pension plans, excess capacity, and weak foreign demand despite a weakening dollar. It wasn't just the internet bubble bursting. The burgeoning tax receipts from the late 1990s led to federal, state, and municipal government spending levels which removed any semblance of fiscal reality. We have been left with a bare cupboard save for the debt levels which do remain and shall create a long term blight on virtually all Americans.
The market value of all publicly traded stocks is approximately 100% of the country's estimated 2003 GDP. This percentage is within 10% of when the market crashed in 1929. If the Iraq war doesn't take place and the market rallies 10%, then we will be at the 1929 valuation level. If the war begins, the market will most likely decline. So the best way to avoid loss of capital is to stay on the sidelines.
Citigroup will layoff 2000 or one-third of their staff in Japan.
Ernest Adams: "The world's a lot less scary when you're carrying a rocket launcher around with you."
Flextronics, based in Singapore, is the world's biggest electronics manufacturing services company. They produce 16% of the world's cell phones; they make X-box game consoles for Microsoft; copiers for Xerox; and PDAs for Casio. They have 87 plants in 27 countries with annual sales of about $14 billion. Their CEO says "we are in the business of cutting costs."
67% of Texans are concerned about having enough money for retirement. They have reason to worry. Life expectancy continues to increase as layoffs rise, gasoline and fuel bills rise, health care costs soar annually, and insurance premiums mount. The average worker has his social security wages taxed at 6.2% up to the $80,400 wage cap rate. When you draw down your social security, there is no tax as long as a single filing person earns $25,000 or less or joint filers earn $32,000 or less. If your income is higher than these levels, then your social security check is taxed at a 50% rate and can go as high as 85%. This is not capitalism but rather our Congress placing socialistic burdens around the necks of all Americans of retirement age. As the population continues to age, social security tax reform must make front page headlines, and soon.
Over the past six plus months the American public has been watching a real life reality show on a world wide screen. Unlike other reality shows, this one has been a true extravaganza and very costly. We have been successful in alienating more countries in the shortest time possible. This requires both a lack of negotiating skill and a limited appreciation of friendship, loyalty, trust, and respect. What will be the cost? The White House and the Pentagon have refused to provide Congress with any viable estimates about the cost of war with Iraq or the post-war reconstruction of Iraq. In fact, members of the Administration as well as the President have been asked questions on the above mentioned costs and no answers have been forthcoming. Senator Chuck Hagel, Republican-Nebraska, said "That does not encourage a great amount of trust and cooperation."
Nikita Khrushchev: "We were simply trying to remind other countries that we were powerful and deserved respect, and that we wouldn't tolerate being talked to in the language of ultimatums."
Bruce Nussbaum, Editorial page editor of Business Week: "The price the Bush Administration is paying for its failed diplomacy is high, and it promises to rise even further. A world divided between multilateral economic and unilateral security policies is an uncertain and risky place. It is not likely to encourage economic growth or prosperity. The Administration risks turning what was once trumpeted as the American Century into the Anti-American Century."
You can blame it on the weather, but the weather hasn't been horrible for the past six months. You can blame it on Iraq, N. Korea, or any other geopolitical arena, but that would be a poor explanation for the low level of business investment, the low level of consumer confidence, a growing number of world-wide layoffs, rising government debt burdens, a debt ceiling reached early in the calendar year, and a stock market which continues into its fourth year of a downward trend. The geopolitical environment cannot explain away increased foreign competition, lack of pricing power, underfunded pension plans, excess capacity, and weak foreign demand despite a weakening dollar. It wasn't just the internet bubble bursting. The burgeoning tax receipts from the late 1990s led to federal, state, and municipal government spending levels which removed any semblance of fiscal reality. We have been left with a bare cupboard save for the debt levels which do remain and shall create a long term blight on virtually all Americans.
The market value of all publicly traded stocks is approximately 100% of the country's estimated 2003 GDP. This percentage is within 10% of when the market crashed in 1929. If the Iraq war doesn't take place and the market rallies 10%, then we will be at the 1929 valuation level. If the war begins, the market will most likely decline. So the best way to avoid loss of capital is to stay on the sidelines.
Citigroup will layoff 2000 or one-third of their staff in Japan.
Ernest Adams: "The world's a lot less scary when you're carrying a rocket launcher around with you."
Flextronics, based in Singapore, is the world's biggest electronics manufacturing services company. They produce 16% of the world's cell phones; they make X-box game consoles for Microsoft; copiers for Xerox; and PDAs for Casio. They have 87 plants in 27 countries with annual sales of about $14 billion. Their CEO says "we are in the business of cutting costs."
67% of Texans are concerned about having enough money for retirement. They have reason to worry. Life expectancy continues to increase as layoffs rise, gasoline and fuel bills rise, health care costs soar annually, and insurance premiums mount. The average worker has his social security wages taxed at 6.2% up to the $80,400 wage cap rate. When you draw down your social security, there is no tax as long as a single filing person earns $25,000 or less or joint filers earn $32,000 or less. If your income is higher than these levels, then your social security check is taxed at a 50% rate and can go as high as 85%. This is not capitalism but rather our Congress placing socialistic burdens around the necks of all Americans of retirement age. As the population continues to age, social security tax reform must make front page headlines, and soon.
Sunday, March 16, 2003
3/16/03 "Peace Is Liberty In Tranquility"
The above words were spoken by Marcus T. Cicero.
The Jewish holiday of Purim arrives on Tuesday, and Israel is concerned about possible terrorist attacks that day.
Ford stock sank to a 10 year low of $6.76. Analysts expect the company to earn 46 cents per share with the income coming from the credit division and the auto sector continuing to lose money. In February Ford's incentives on each vehicle amounted to $3543. Ford Motor Credit has about $150 billion in debt.
Marianne Williamson conducts workshops called Creating Peace in America. If you go to renaissancealliance.org, you can learn about starting a peace circle in your community.
The average daily cost of providing adult care is $56 while the average daily cost of nursing home care in the U.S. is $120. More than half of U.S. counties lack enough adult day care centers to meet current needs.
Over the past decade Japan has had three recessions, and that is despite zero interest rates and trillions of yen spent by the government in an effort to stimulate their economy. Japan's public debt weighs heavily on their economy and amounts to about 650 trillion yen or about 130% of their GDP. Japan's public debt is the highest in the industrialized world. With this overwhelming debt burden, the Nikkei has plunged 80% since 1989. If the U.S. continues to expand its debt at the current rate, we can expect the Dow and the S&P 500 to have a long road to significant declines.
In 1991 the average price of gasoline was $1.20 per gallon, and now it's $1.85. Adjusting for inflation, the price is still much higher now.
In 1991 12 million Americans regularly used the internet compared to about 130 million now. In 1991 only 17% of American homes had a PC compared to about 63% now.
Iraq is a country the size of California.
The President wants to limit the appeals process after a Medicare claim has been denied. Many in the legal profession believe setting appeal limits would violate constitutional rights.
Leonard Pitts, Jr., Miami Herald: "Sometimes, God is viewed best in hindsight, seen most clearly in rear view. At the height of storm, in the heat of fury, in the closeness of peril, that which will later seem plain is often anything but. But then the tumult passes and understanding appears like rainbows."
The above words were spoken by Marcus T. Cicero.
The Jewish holiday of Purim arrives on Tuesday, and Israel is concerned about possible terrorist attacks that day.
Ford stock sank to a 10 year low of $6.76. Analysts expect the company to earn 46 cents per share with the income coming from the credit division and the auto sector continuing to lose money. In February Ford's incentives on each vehicle amounted to $3543. Ford Motor Credit has about $150 billion in debt.
Marianne Williamson conducts workshops called Creating Peace in America. If you go to renaissancealliance.org, you can learn about starting a peace circle in your community.
The average daily cost of providing adult care is $56 while the average daily cost of nursing home care in the U.S. is $120. More than half of U.S. counties lack enough adult day care centers to meet current needs.
Over the past decade Japan has had three recessions, and that is despite zero interest rates and trillions of yen spent by the government in an effort to stimulate their economy. Japan's public debt weighs heavily on their economy and amounts to about 650 trillion yen or about 130% of their GDP. Japan's public debt is the highest in the industrialized world. With this overwhelming debt burden, the Nikkei has plunged 80% since 1989. If the U.S. continues to expand its debt at the current rate, we can expect the Dow and the S&P 500 to have a long road to significant declines.
In 1991 the average price of gasoline was $1.20 per gallon, and now it's $1.85. Adjusting for inflation, the price is still much higher now.
In 1991 12 million Americans regularly used the internet compared to about 130 million now. In 1991 only 17% of American homes had a PC compared to about 63% now.
Iraq is a country the size of California.
The President wants to limit the appeals process after a Medicare claim has been denied. Many in the legal profession believe setting appeal limits would violate constitutional rights.
Leonard Pitts, Jr., Miami Herald: "Sometimes, God is viewed best in hindsight, seen most clearly in rear view. At the height of storm, in the heat of fury, in the closeness of peril, that which will later seem plain is often anything but. But then the tumult passes and understanding appears like rainbows."
Saturday, March 15, 2003
3/15/03 Mosquito Hill
Senator John McCain: "Being chairman of the Senate Commerce Committee is like being a mosquito in a nudist colony." His mission is to make corporations more accountable. Now, if only he were able to make the Congress, governmental agencies, and lawmakers more accountable.
Manufacturers are absorbing increased energy costs and are not able to pass them on to customers. This creates lower profit margins and ultimately lower than expected earnings per share, and the latter result in lower stock prices.
February's business equipment production dropped 2.4% on a year-over-year basis.
PC shipments will increase less than forecast this year. Governments are spending less on PCs and related equipment because tax revenue is falling, and businesses are concerned about revenue prospects.
Knute Rockne: "Most men, when they think they are thinking, are merely rearranging their prejudices."
Charles Schwab and Ameritrade cut their earnings and revenue projections- again.
From December to February Advanced Micro Devices (AMD) laid off 5% of its workforce.
Halliburton, the company headed by VP Cheney from 1995 until 2000, is one of five companies asked to bid on possible reconstruction work in Iraq. Halliburton from 1999 to 2000 gave political contributions of $709,320, and 95% went to Republicans.
Germany's Commerzbank plans to eliminate 2800 more jobs.
Pope John XXIII: "It often happens that I wake at night and begin to think about a serious problem and decide I must tell the pope about it. Then I wake up completely and remember that I am the pope!"
The University of Michigan's preliminary March index of consumer sentiment dropped to 75 from about 80 in February, and this was the lowest level in 11 years. The current conditions index plunged to 87 from 95 in February, and the expectations index fell too.
The number of jobs lost in NYC the past two years amounts to 223,000, and the city jobless rate is 8.6%, the highest level in five years. The rate will go higher as municipal workers are about to be given pink slips because of the budget crisis.
"This week we see an increasingly fragile economy that is at a tipping point," Economic Cycle Research Institute (ECRI) director Aniran Banerji said. "Depending on the course of oil prices and geopolitical events, we could be tipped into a new recession." Other ECRI global indicators show that the economies of Europe and Asia are similarly vulnerable.
We have witnessed the 49ers discard Joe Montana and recently the Cowboys let Emmitt Smith go. Now there is Junior Seau, a 12 time Pro Bowler who has spent his entire career with the Chargers. The latter gave Seau permission to talk to other clubs for a trade. Seau, like Montana and Smith, no longer fit into the club's plans. When the star team player is shown no loyalty and treated with little respect, why should a fan support the team?
Senator John McCain: "Being chairman of the Senate Commerce Committee is like being a mosquito in a nudist colony." His mission is to make corporations more accountable. Now, if only he were able to make the Congress, governmental agencies, and lawmakers more accountable.
Manufacturers are absorbing increased energy costs and are not able to pass them on to customers. This creates lower profit margins and ultimately lower than expected earnings per share, and the latter result in lower stock prices.
February's business equipment production dropped 2.4% on a year-over-year basis.
PC shipments will increase less than forecast this year. Governments are spending less on PCs and related equipment because tax revenue is falling, and businesses are concerned about revenue prospects.
Knute Rockne: "Most men, when they think they are thinking, are merely rearranging their prejudices."
Charles Schwab and Ameritrade cut their earnings and revenue projections- again.
From December to February Advanced Micro Devices (AMD) laid off 5% of its workforce.
Halliburton, the company headed by VP Cheney from 1995 until 2000, is one of five companies asked to bid on possible reconstruction work in Iraq. Halliburton from 1999 to 2000 gave political contributions of $709,320, and 95% went to Republicans.
Germany's Commerzbank plans to eliminate 2800 more jobs.
Pope John XXIII: "It often happens that I wake at night and begin to think about a serious problem and decide I must tell the pope about it. Then I wake up completely and remember that I am the pope!"
The University of Michigan's preliminary March index of consumer sentiment dropped to 75 from about 80 in February, and this was the lowest level in 11 years. The current conditions index plunged to 87 from 95 in February, and the expectations index fell too.
The number of jobs lost in NYC the past two years amounts to 223,000, and the city jobless rate is 8.6%, the highest level in five years. The rate will go higher as municipal workers are about to be given pink slips because of the budget crisis.
"This week we see an increasingly fragile economy that is at a tipping point," Economic Cycle Research Institute (ECRI) director Aniran Banerji said. "Depending on the course of oil prices and geopolitical events, we could be tipped into a new recession." Other ECRI global indicators show that the economies of Europe and Asia are similarly vulnerable.
We have witnessed the 49ers discard Joe Montana and recently the Cowboys let Emmitt Smith go. Now there is Junior Seau, a 12 time Pro Bowler who has spent his entire career with the Chargers. The latter gave Seau permission to talk to other clubs for a trade. Seau, like Montana and Smith, no longer fit into the club's plans. When the star team player is shown no loyalty and treated with little respect, why should a fan support the team?
Friday, March 14, 2003
3/14/03 A Sharp Relief Rally
They're nice to see. The FTSE is up about 9% in a day and a half. Even the Nikkei rallied. We were greeted with nice gains in almost all areas of our market yesterday, and at the outset, we can expect the upward bias to continue. Many such rallies have taken place over the past three years, and more will occur in the future. Just keep the trend your friend, and you'll stay out of harm's way. The trend is decidedly down.
On September 13 President Bush told the UN "we can expect quick resolution to the issue" (of Iraqi disarmament) and set a deadline of "days and weeks, not months and years." I am certain the President meant what he said; however, when a strategy does not work, alternative routes should be explored and hopefully followed. That is true with investing. When wrong, limit your losses. The first loss is the best loss.
Ford will cut second quarter production by 17% and GM by 10%. I mentioned in December this would happen, and you can look for further production cuts thru the year.
Ted Williams: "All managers are losers. They are the most expendable pieces of furniture on the face of the Earth."
U.S. retail sales in February had their largest drop since February 2001. Sales fell by 1.6%.
In a 10Q filing HP said they overstated cash flow from operations for the first quarter by $144 million. I am certain that it was not intentional. Mistakes like that seem to be happening with greater frequency. It must be the water in the Silicon Valley.
GM's annual pension expense is $2.8 billion. Some countries don't spend that kind of dough.
Approximately 20% of the workforce is being laid off at Thomas Weisel Partners. I'm surprised the number isn't larger.
Satchel Paige: "Work like you don't need the money. Love like you've never been hurt. Dance like nobody's watching."
A poll of 90 equity strategists expect market gains of 9% in the U.S. this year. I wonder how their prognosis was from 2000 thru 2002. I wonder whether they are putting their money where their mouth is. That's if they have any money left from prior poor market calls.
EBay rose to a 52 week high yesterday and Adobe exceeded profit forecasts. On the other hand, profit estimates were cut for Baxter Labs, ADP, ConAgra, Bebe, Tyco, and International Paper.
The number of individuals who are jobless and have been filing continuing claims is 3.5 million.
J.M Smucker will lay off 335.
Tomorrow 10,000 California teachers will receive layoff notices.
Ty Cobb: "To get along with me, don't increase my tension." How many Americans feel that way right now?
They're nice to see. The FTSE is up about 9% in a day and a half. Even the Nikkei rallied. We were greeted with nice gains in almost all areas of our market yesterday, and at the outset, we can expect the upward bias to continue. Many such rallies have taken place over the past three years, and more will occur in the future. Just keep the trend your friend, and you'll stay out of harm's way. The trend is decidedly down.
On September 13 President Bush told the UN "we can expect quick resolution to the issue" (of Iraqi disarmament) and set a deadline of "days and weeks, not months and years." I am certain the President meant what he said; however, when a strategy does not work, alternative routes should be explored and hopefully followed. That is true with investing. When wrong, limit your losses. The first loss is the best loss.
Ford will cut second quarter production by 17% and GM by 10%. I mentioned in December this would happen, and you can look for further production cuts thru the year.
Ted Williams: "All managers are losers. They are the most expendable pieces of furniture on the face of the Earth."
U.S. retail sales in February had their largest drop since February 2001. Sales fell by 1.6%.
In a 10Q filing HP said they overstated cash flow from operations for the first quarter by $144 million. I am certain that it was not intentional. Mistakes like that seem to be happening with greater frequency. It must be the water in the Silicon Valley.
GM's annual pension expense is $2.8 billion. Some countries don't spend that kind of dough.
Approximately 20% of the workforce is being laid off at Thomas Weisel Partners. I'm surprised the number isn't larger.
Satchel Paige: "Work like you don't need the money. Love like you've never been hurt. Dance like nobody's watching."
A poll of 90 equity strategists expect market gains of 9% in the U.S. this year. I wonder how their prognosis was from 2000 thru 2002. I wonder whether they are putting their money where their mouth is. That's if they have any money left from prior poor market calls.
EBay rose to a 52 week high yesterday and Adobe exceeded profit forecasts. On the other hand, profit estimates were cut for Baxter Labs, ADP, ConAgra, Bebe, Tyco, and International Paper.
The number of individuals who are jobless and have been filing continuing claims is 3.5 million.
J.M Smucker will lay off 335.
Tomorrow 10,000 California teachers will receive layoff notices.
Ty Cobb: "To get along with me, don't increase my tension." How many Americans feel that way right now?
Thursday, March 13, 2003
3/13/03 A Multilateral Outlet By Consensus
Vincente Fox of Mexico is not your every day politician. He worked for Coca Cola and understands the art of negotiating. As it pertains to the potential Iraqi conflict, he "continues to work to find a multilateral outlet by consensus." Fox and others will, in my view, be successful in having nations come together in providing guideposts to 29 clusters of issues Iraq must address. A possible war deadline will be extended for about 30 days, and these guideposts will be satisfied along the way. Then, Iraq will fade from the headlines, and the economy will get center stage.
Sophocles: "You win the victory when you yield to friends."
The Securities Industry Association said foreign investors bought $507 billion in U.S. stocks and bonds in 2002, and more than 90% of the purchases was in bonds.
Crude oil futures closed at a 12 year high.
Philips Electronics will cut 1600 jobs in the U.S. and Europe.
Milton Friedman: "The government always has a public defender. It has a straight access to the media and to the public airwaves."
The projected liabilities of the three main Illinois pension funds for public workers exceed their assets by 1 1/2 times the state's operating budget for a single year.
Black Box's stock plunged to a 4 year low as the company warned weak tech spending would create a 4th quarter substantially below forecasts.
Magellan Health filed for chapter 11.
Charles De Gaulle: "Since a politician never believes what he says, he is surprised when others believe him."
This is Cover The Uninsured Week.
Intel's CEO said the business outlook remains unclear. I'm so glad he cleared that up for us.
Bertrand Russell: " Patriotism is the willingness to kill and be killed for trivial reasons."
Germany's DAX fell to its lowest level in 7 years.
Over the past 12 months American Airlines stock has lost 95% of its value.
Ann Taylor lowered its first quarter profit forecast as did Maytag.
The major defense stocks- General Dynamics, Northrop Grumman, Lockheed Martin, and Raytheon- are all trading at year lows.
Altira Group, which owns the Marlboro brand of cigarettes, has a 7.1% dividend yield.
Confucious: "To put the world right in order, we must first put the nation in order; to put the nation in order, we must first put the family in order; to put the family in order, we must first cultivate our personal life; we must first set our hearts right."
The trade deficit in January was $41.1 billion, the second highest on record.
The mortgage refinance index soared more than 35% to a record weekly high.
McDonald's same store sales for February fell 4.7%.
If children are our future, then we have some serious thinking to do. Across this nation there are a large number of teacher layoffs. States and municipalities have critical cash flow problems, and the education of our children will suffer in the present and even more so in years to come. This is a problem which must be addressed and corrected. Education must be a priority. The speeches from politicians will not return teachers to the classroom or prevent future teacher layoffs.
Vincente Fox of Mexico is not your every day politician. He worked for Coca Cola and understands the art of negotiating. As it pertains to the potential Iraqi conflict, he "continues to work to find a multilateral outlet by consensus." Fox and others will, in my view, be successful in having nations come together in providing guideposts to 29 clusters of issues Iraq must address. A possible war deadline will be extended for about 30 days, and these guideposts will be satisfied along the way. Then, Iraq will fade from the headlines, and the economy will get center stage.
Sophocles: "You win the victory when you yield to friends."
The Securities Industry Association said foreign investors bought $507 billion in U.S. stocks and bonds in 2002, and more than 90% of the purchases was in bonds.
Crude oil futures closed at a 12 year high.
Philips Electronics will cut 1600 jobs in the U.S. and Europe.
Milton Friedman: "The government always has a public defender. It has a straight access to the media and to the public airwaves."
The projected liabilities of the three main Illinois pension funds for public workers exceed their assets by 1 1/2 times the state's operating budget for a single year.
Black Box's stock plunged to a 4 year low as the company warned weak tech spending would create a 4th quarter substantially below forecasts.
Magellan Health filed for chapter 11.
Charles De Gaulle: "Since a politician never believes what he says, he is surprised when others believe him."
This is Cover The Uninsured Week.
Intel's CEO said the business outlook remains unclear. I'm so glad he cleared that up for us.
Bertrand Russell: " Patriotism is the willingness to kill and be killed for trivial reasons."
Germany's DAX fell to its lowest level in 7 years.
Over the past 12 months American Airlines stock has lost 95% of its value.
Ann Taylor lowered its first quarter profit forecast as did Maytag.
The major defense stocks- General Dynamics, Northrop Grumman, Lockheed Martin, and Raytheon- are all trading at year lows.
Altira Group, which owns the Marlboro brand of cigarettes, has a 7.1% dividend yield.
Confucious: "To put the world right in order, we must first put the nation in order; to put the nation in order, we must first put the family in order; to put the family in order, we must first cultivate our personal life; we must first set our hearts right."
The trade deficit in January was $41.1 billion, the second highest on record.
The mortgage refinance index soared more than 35% to a record weekly high.
McDonald's same store sales for February fell 4.7%.
If children are our future, then we have some serious thinking to do. Across this nation there are a large number of teacher layoffs. States and municipalities have critical cash flow problems, and the education of our children will suffer in the present and even more so in years to come. This is a problem which must be addressed and corrected. Education must be a priority. The speeches from politicians will not return teachers to the classroom or prevent future teacher layoffs.
Wednesday, March 12, 2003
3/12/03 Retrench Or Regret
Yesterday the GOP House budget plan was released. It indicates that the federal government will have a balanced budget in 7 years. This is both pathetic and a sign of the times. The present budget forecast for this year has been changed 4 times over the past 8 months. We are in DIRE trouble. As I have mentioned so often, the trade deficit plus the budget deficit will amount to about $660 billion for 2002. We must not forget about Medicare and Medicaid and their combined cost of about 1.25 trillion dollars. Our country has run out of spending power. Had it not been for lower interests, such as, 10 year treasury notes hitting a 45 year low yield of 3.55%, there is no telling how much sooner this crisis would have been upon us. If we keep alienating foreign nations, then our dollar will not be viewed as a safe haven, and we will have difficulty attracting $1.6 billion daily into the country to fund our deficits. It is unwise to depend on others for financial resources, and to depend on a daily basis, undermines our freedoms. Our debts have the potential to be more damaging than terrorism. A real Patriot Act would limit the debt ceiling, limit spending, cut government waste, reduce Congressional staffing, and eliminate hundreds of departments. We can face the music now, or regret it for the rest of our lives.
Fannie Mae, for the first time, will raise funds in foreign currencies-euros, Swiss francs, sterling, and yen. The notes will have maturities of between five and 183 days.
According to a study by Decision Analyst, Inc., confidence in the stock market and mutual funds has fallen by about 50% in the past year. It should be noted that more than double the percentage of males to females expect the value of stocks and mutual funds to increase.
January wholesale inventories fell 0.2% and the inventory/sales ratio returned to November's record low of 1.21. Until new orders become more robust, inventories will be held to a minimum.
Morgan Stanley strategist Barton Biggs believes we are in the process of making an important bottom in the stock markets around the world. Everyone is entitled to his opinion. Barton is a bright guy. I disagree with his opinion.
U.S Steel expects a first quarter loss.
A Gartner Europe survey suggests European IT spending will not grow in 2003. The real question should be- will it decline?
Broadway producers and musicians reached a deal to end the strike.
France has billions of dollars of oil contracts with Iraq. Years ago France sold nuclear material to Iraq.
The FTSE hit a 7 1/2 year low.
French fries and french toast should be off the menu anyway. I, for one, don't need the calories.
In the Gulf War we had 33 countries contributing funds and troops. Look at our bank balance. We don't have the jack to pull off this war alone, and we cannot put our soldiers in harm's way by themselves. That is why I have stated for the past six months that there would not be a war.
Yesterday the GOP House budget plan was released. It indicates that the federal government will have a balanced budget in 7 years. This is both pathetic and a sign of the times. The present budget forecast for this year has been changed 4 times over the past 8 months. We are in DIRE trouble. As I have mentioned so often, the trade deficit plus the budget deficit will amount to about $660 billion for 2002. We must not forget about Medicare and Medicaid and their combined cost of about 1.25 trillion dollars. Our country has run out of spending power. Had it not been for lower interests, such as, 10 year treasury notes hitting a 45 year low yield of 3.55%, there is no telling how much sooner this crisis would have been upon us. If we keep alienating foreign nations, then our dollar will not be viewed as a safe haven, and we will have difficulty attracting $1.6 billion daily into the country to fund our deficits. It is unwise to depend on others for financial resources, and to depend on a daily basis, undermines our freedoms. Our debts have the potential to be more damaging than terrorism. A real Patriot Act would limit the debt ceiling, limit spending, cut government waste, reduce Congressional staffing, and eliminate hundreds of departments. We can face the music now, or regret it for the rest of our lives.
Fannie Mae, for the first time, will raise funds in foreign currencies-euros, Swiss francs, sterling, and yen. The notes will have maturities of between five and 183 days.
According to a study by Decision Analyst, Inc., confidence in the stock market and mutual funds has fallen by about 50% in the past year. It should be noted that more than double the percentage of males to females expect the value of stocks and mutual funds to increase.
January wholesale inventories fell 0.2% and the inventory/sales ratio returned to November's record low of 1.21. Until new orders become more robust, inventories will be held to a minimum.
Morgan Stanley strategist Barton Biggs believes we are in the process of making an important bottom in the stock markets around the world. Everyone is entitled to his opinion. Barton is a bright guy. I disagree with his opinion.
U.S Steel expects a first quarter loss.
A Gartner Europe survey suggests European IT spending will not grow in 2003. The real question should be- will it decline?
Broadway producers and musicians reached a deal to end the strike.
France has billions of dollars of oil contracts with Iraq. Years ago France sold nuclear material to Iraq.
The FTSE hit a 7 1/2 year low.
French fries and french toast should be off the menu anyway. I, for one, don't need the calories.
In the Gulf War we had 33 countries contributing funds and troops. Look at our bank balance. We don't have the jack to pull off this war alone, and we cannot put our soldiers in harm's way by themselves. That is why I have stated for the past six months that there would not be a war.
Tuesday, March 11, 2003
3/11/03 An Exit Strategy
Whether it's in the area of investing, diplomacy, or even relationships, one would be best off by having an exit strategy prior to getting in over one's head. There is absolutely no rationality in the risk of drowning in deep water when one's swimming skills are limited. In the stock market investors often get stubborn and insist the market is wrong. The market takes no prisoners. When you go against the trend, you must re-group and exit gracefully. Your first loss is your best loss. Minimize the loss whenever possible. We can't be right all the time, but being wrong can be costly, and that's true in life.
Milton Friedman: "Only government can take perfectly good paper, cover it with perfectly good ink, and make the combination worthless."
The UN Head, Kofi Annan, said that military action against Iraq without UN support would violate the organization's charter.
The quarterly earnings for HJ Heinz was lower.
Nokia warned on its sales outlook.
Volkswagen's first quarter earnings will fall significantly.
The Nikkei closed below 8000 for the first time in 20 years.
Consumer pessimism worsened a good deal as it relates to the economy, and the index dropped to 48.8, and is the first time ever it has been below 50. This is highly important. I hope everyone is paying attention. The poll was taken on Sunday.
Japan Airlines cuts its forecast by 67%.
Robert Higgs, a senior fellow in political economy at the Independent Institute: "It seems to me that when we enacted the USA Patriot Act, the U.S. came closer to being a police state. If Patriot II is enacted, we have kissed the Constitution goodbye."
al-Qaeda is seeking Middle East recruits for terrorist attacks on oil fields in Saudi Arabia and Kuwait should the U.S. invade Iraq.
Whether it's in the area of investing, diplomacy, or even relationships, one would be best off by having an exit strategy prior to getting in over one's head. There is absolutely no rationality in the risk of drowning in deep water when one's swimming skills are limited. In the stock market investors often get stubborn and insist the market is wrong. The market takes no prisoners. When you go against the trend, you must re-group and exit gracefully. Your first loss is your best loss. Minimize the loss whenever possible. We can't be right all the time, but being wrong can be costly, and that's true in life.
Milton Friedman: "Only government can take perfectly good paper, cover it with perfectly good ink, and make the combination worthless."
The UN Head, Kofi Annan, said that military action against Iraq without UN support would violate the organization's charter.
The quarterly earnings for HJ Heinz was lower.
Nokia warned on its sales outlook.
Volkswagen's first quarter earnings will fall significantly.
The Nikkei closed below 8000 for the first time in 20 years.
Consumer pessimism worsened a good deal as it relates to the economy, and the index dropped to 48.8, and is the first time ever it has been below 50. This is highly important. I hope everyone is paying attention. The poll was taken on Sunday.
Japan Airlines cuts its forecast by 67%.
Robert Higgs, a senior fellow in political economy at the Independent Institute: "It seems to me that when we enacted the USA Patriot Act, the U.S. came closer to being a police state. If Patriot II is enacted, we have kissed the Constitution goodbye."
al-Qaeda is seeking Middle East recruits for terrorist attacks on oil fields in Saudi Arabia and Kuwait should the U.S. invade Iraq.
Monday, March 10, 2003
3/10/03 Pension Fund Losses and Stock Valuations
In their latest annual report GE disclosed that its pension plan lost $5.25 billion in 2002, and this loss was equal to 29% of the company's pre-tax earnings. This is a major loss, and is not surprising given last year's drop in GE's stock price. What is surprising is the call that many well-known money managers have recently made on stock valuations. Many consider stocks to be fairly priced given the current price/earnings ratio for the S&P 500. What they have missed is the huge losses in pension funds for the S&P 500 companies. When one accounts for these losses, the price/earnings ratio no longer looks favorable. In fact, it makes stocks look overpriced. I am not including into the equation my view that earnings projections are materially too high. Once again, I urge you to forget about chasing any mini rallies. It's fool's gold, and staying on the sidelines will prove more fruitful. I know I have been saying this for three years but at least you retained your capital while others suffered huge losses- like the GE pension fund.
Heating oil prices are up 58% this year.
Japan's February bank lending fell for the 63rd consecutive month. That's quite a streak.
The Nikkei fell below the 8000 mark, and this average has not closed below that level since March 1983.
Warren Buffett: "Risk comes from not knowing what you're doing."
Gasoline is $1.50 per gallon in Atlanta and $2.10 in San Francisco. In the past two weeks pump prices are up 14 cents a gallon in California.
Today, 25% of doctors are women. By 2010 the percentage is expected to increase to 33%.
Same store sales for Best Buy were down 0.2% and for Circuit City down 6%.
The late U.S. Air Force Colonel John Boyd said that war is fought at three levels- moral, mental, and physical. He said the moral level is the most powerful and the physical level the least powerful.
Last year India's GDP grew at a 4.4% annual rate.
There are 32.5 million foreign-born citizens in the U.S. or 11 1/2% of the population.
The growers elected a new board of directors at Ocean Spray.
Has anyone seen Saif al-Adel? With a $25 million reward it might prove more lucrative than winning lotto. He is supposedly the number three in al-Qaeda. How many number threes are there? It reminds me of a quiz show.
In their latest annual report GE disclosed that its pension plan lost $5.25 billion in 2002, and this loss was equal to 29% of the company's pre-tax earnings. This is a major loss, and is not surprising given last year's drop in GE's stock price. What is surprising is the call that many well-known money managers have recently made on stock valuations. Many consider stocks to be fairly priced given the current price/earnings ratio for the S&P 500. What they have missed is the huge losses in pension funds for the S&P 500 companies. When one accounts for these losses, the price/earnings ratio no longer looks favorable. In fact, it makes stocks look overpriced. I am not including into the equation my view that earnings projections are materially too high. Once again, I urge you to forget about chasing any mini rallies. It's fool's gold, and staying on the sidelines will prove more fruitful. I know I have been saying this for three years but at least you retained your capital while others suffered huge losses- like the GE pension fund.
Heating oil prices are up 58% this year.
Japan's February bank lending fell for the 63rd consecutive month. That's quite a streak.
The Nikkei fell below the 8000 mark, and this average has not closed below that level since March 1983.
Warren Buffett: "Risk comes from not knowing what you're doing."
Gasoline is $1.50 per gallon in Atlanta and $2.10 in San Francisco. In the past two weeks pump prices are up 14 cents a gallon in California.
Today, 25% of doctors are women. By 2010 the percentage is expected to increase to 33%.
Same store sales for Best Buy were down 0.2% and for Circuit City down 6%.
The late U.S. Air Force Colonel John Boyd said that war is fought at three levels- moral, mental, and physical. He said the moral level is the most powerful and the physical level the least powerful.
Last year India's GDP grew at a 4.4% annual rate.
There are 32.5 million foreign-born citizens in the U.S. or 11 1/2% of the population.
The growers elected a new board of directors at Ocean Spray.
Has anyone seen Saif al-Adel? With a $25 million reward it might prove more lucrative than winning lotto. He is supposedly the number three in al-Qaeda. How many number threes are there? It reminds me of a quiz show.
Sunday, March 09, 2003
3/9/03 Jesse Livermore
About 70 years ago Jesse was known as the greatest trader Wall Street had ever known. He had his own system, and he followed it like a religion. He could do no wrong. Then slowly Jesse got to reading his own headlines. It got to the point where he believed he could do anything he set out to do. The problem was he forgot his basic trading tenets, the ones where he could do no wrong. Jesse lost all his money, and finally his life was taken via suicide.
Jesse Livermore: "There is only one side of the market and it is not the bull side or the bear side, but the right side."
Jesse Livermore: "A loss never bothers me after I take it. I forget it overnight. But being wrong-not taking the loss- that is what does damage to the pocketbook and to the soul." In the end, Jesse was done in by not taking the loss.
Berkshire Hathaway had a banner year in 2002, and earned $4.3 billion on revenues of $42 billion. Winners like Warren Buffett do it the old fashion way- they stick to their knitting and work hard.
Heizo Takenada, Japan's Economics and Financial Services Minister, said today that the BOJ should ease monetary policy even more. Right now short term interest rates are at zero per cent. He suggested the BOJ buy stocks and possibly real estate. Then he got a dose of reality and said "basically, stock price remedies- measures to boost stock prices- are simply impossible." That's right. The market is bigger than any single entity or group of entities, and that includes governments.
The CIA holds two of Shaikh Mohammed's sons in their attempt to get their father to talk. Terrorism is a dirty business.
Health care staffing is a different reality from the job market on main street. It is common to offer a $5000 signing bonus in order to hire an experienced register nurse. Quarterly raises come with the hiring package.
About 70 years ago Jesse was known as the greatest trader Wall Street had ever known. He had his own system, and he followed it like a religion. He could do no wrong. Then slowly Jesse got to reading his own headlines. It got to the point where he believed he could do anything he set out to do. The problem was he forgot his basic trading tenets, the ones where he could do no wrong. Jesse lost all his money, and finally his life was taken via suicide.
Jesse Livermore: "There is only one side of the market and it is not the bull side or the bear side, but the right side."
Jesse Livermore: "A loss never bothers me after I take it. I forget it overnight. But being wrong-not taking the loss- that is what does damage to the pocketbook and to the soul." In the end, Jesse was done in by not taking the loss.
Berkshire Hathaway had a banner year in 2002, and earned $4.3 billion on revenues of $42 billion. Winners like Warren Buffett do it the old fashion way- they stick to their knitting and work hard.
Heizo Takenada, Japan's Economics and Financial Services Minister, said today that the BOJ should ease monetary policy even more. Right now short term interest rates are at zero per cent. He suggested the BOJ buy stocks and possibly real estate. Then he got a dose of reality and said "basically, stock price remedies- measures to boost stock prices- are simply impossible." That's right. The market is bigger than any single entity or group of entities, and that includes governments.
The CIA holds two of Shaikh Mohammed's sons in their attempt to get their father to talk. Terrorism is a dirty business.
Health care staffing is a different reality from the job market on main street. It is common to offer a $5000 signing bonus in order to hire an experienced register nurse. Quarterly raises come with the hiring package.
Saturday, March 08, 2003
3/8/03 Don't Complain About The Recession-It Might Worsen
Two year treasury notes yield 1.36%, the lowest level since being regularly issued 30 years ago. The Fed's overnight funds rate of 1.25% will be reduced at the next Fed meeting on March 18. If rates went to zero per cent, it would be too little too late. The Fed is out of the picture. They blew their shot long ago. The economy is spinning out of control, and the downward spiral is picking up speed.
The aggregate hours worked dropped 1% in February. In other words, workers are being paid for less hours but being asked to produce more in those less hours. Morale and fairness be damned.
John Snow: "the cost of war is a one-time sort of thing." Death, John, has an on-going price tag.
Ebay shuts down Half.com.
Microsoft releases their test IM version.
Last October, by a vote of 77-23, the Senate voted to authorize the president to take military action against Iraq. Many, including Tom Harkin of Iowa, said they voted in favor because the language required the administration to seek diplomatic solutions to the stand off with Iraq. Those solutions have been sought; however, the vote to invade Iraq would be very different today.
Hooters Air had their inaugural flight from Atlanta to Myrtle Beach. Will snug t-shirts and orange hotpants sell friendly seats? The chicken wings will not be served.
Will Rogers: "the nation is prosperous on the whole, but how much prosperity is there in a hole?
Intel lost market share due to price hikes in flash memory. In a weak economy pricing power is a figment of one's imagination. Intel's imagination must be running wild. That's more than I can say for their stock price.
The FTSE closed at a 5 week low.
Warren Buffett: "Unfortunately, the hangover from the market bubble may prove to be proportional to the binge."
Crude oil prices rose to a 12 year high. The price of oil has risen 21% this year.
Currently, Iraq is pumping 2.5 billion barrels a day or 3% of the world's oil supply. Opec as a whole pumps a third of the world's oil.
Mahatma Ghandi: "First they ignore you, then they laugh at you, then they fight you, then you win."
Mahatma Ghandi: "Live as if you were to die tomorrow. Learn as if you were to live forever."
The NYC musicians' strike closed Broadway musicals for the first time since 1975.
Jeff Immelt, Ge Chairman: "we have identified six new platforms that we believe can be big, each having $1 billion of operating profit within the next few years- healthcare information technology, security and sensors, Hispanic broadcasting, water technology and services, and U.S. consumer finance.
AynRand: "force and mind are opposites, morality ends where the gun begins."
Paul Volcker: "If you don't have bad loans, you are not in business." Japan and China have learned that.
Two year treasury notes yield 1.36%, the lowest level since being regularly issued 30 years ago. The Fed's overnight funds rate of 1.25% will be reduced at the next Fed meeting on March 18. If rates went to zero per cent, it would be too little too late. The Fed is out of the picture. They blew their shot long ago. The economy is spinning out of control, and the downward spiral is picking up speed.
The aggregate hours worked dropped 1% in February. In other words, workers are being paid for less hours but being asked to produce more in those less hours. Morale and fairness be damned.
John Snow: "the cost of war is a one-time sort of thing." Death, John, has an on-going price tag.
Ebay shuts down Half.com.
Microsoft releases their test IM version.
Last October, by a vote of 77-23, the Senate voted to authorize the president to take military action against Iraq. Many, including Tom Harkin of Iowa, said they voted in favor because the language required the administration to seek diplomatic solutions to the stand off with Iraq. Those solutions have been sought; however, the vote to invade Iraq would be very different today.
Hooters Air had their inaugural flight from Atlanta to Myrtle Beach. Will snug t-shirts and orange hotpants sell friendly seats? The chicken wings will not be served.
Will Rogers: "the nation is prosperous on the whole, but how much prosperity is there in a hole?
Intel lost market share due to price hikes in flash memory. In a weak economy pricing power is a figment of one's imagination. Intel's imagination must be running wild. That's more than I can say for their stock price.
The FTSE closed at a 5 week low.
Warren Buffett: "Unfortunately, the hangover from the market bubble may prove to be proportional to the binge."
Crude oil prices rose to a 12 year high. The price of oil has risen 21% this year.
Currently, Iraq is pumping 2.5 billion barrels a day or 3% of the world's oil supply. Opec as a whole pumps a third of the world's oil.
Mahatma Ghandi: "First they ignore you, then they laugh at you, then they fight you, then you win."
Mahatma Ghandi: "Live as if you were to die tomorrow. Learn as if you were to live forever."
The NYC musicians' strike closed Broadway musicals for the first time since 1975.
Jeff Immelt, Ge Chairman: "we have identified six new platforms that we believe can be big, each having $1 billion of operating profit within the next few years- healthcare information technology, security and sensors, Hispanic broadcasting, water technology and services, and U.S. consumer finance.
AynRand: "force and mind are opposites, morality ends where the gun begins."
Paul Volcker: "If you don't have bad loans, you are not in business." Japan and China have learned that.
Friday, March 07, 2003
3/7/03 God Doesn't Play Dice
That quotation belongs to Albert Einstein. He also said "not everything that counts can be counted, and not everything that can be counted counts."
Payrolls plunged by 308,000, and this was the sharpest drop since 9/11. Believe it or not payrolls had been expected to rise by 10,000. Just the other day I mentioned you could expect a downbeat employment report. Jobs, or the lack of, are going from bad to awful. You can expect it to get worse.
The Nikkei ended at a fresh 20 year low.
The dollar hit a new 4 year low vs the Euro and the Swiss franc.
The airline industry is expected to lose $6.5 billion in 2003.
Niccolo Machiavelli: "If an injury has to be done to a man it should be so severe that his vengeance need not be feared." I'm with you on this one, Niccolo.
Ulysses S. Grant: "I never advocated war except as a means of peace." Ditto.
The insured unemployment rate jumped to 2.8% from 2.6% in the latest week. This is meaningful.
February same store sales for Barnes and Noble were down 4.4% and for B. Dalton Bookseller down 12.3%. Are people reading less?
February same store sales for Federated were down 6.8%; for Ann Taylor's down 8.6%; and for Sears down 9.4%
Sears is trading at a 10 year low. When you pick bad management, you end up with disastrous results. This compares with WalMart, and the latter just increased its dividend for the 29th consecutive year. The great ones just keep performing. They walk the talk.
Thirty year mortgages hit a record low of 5.67%
Household debt rose 10.7% in the final quarter of 2002- the biggest jump in 13 years.
Mortgage debt rose 13.7%, and it was the biggest jump in 15 years.
Germany's unemployment rate rose to 11.3%. You thought we have it bad.
Iraq owes $2 billion to the USDA for loans that have gone unpaid since 1990 plus $1 billion in interest. These were guaranteed loans to buy U.S. food. In June 1990, just 2 months prior to the invasion of Kuwait, the first Bush Administration was against imposing sanctions on Iraq, and those sanctions would have blocked sales of U.S. food to Iraq.
In Georgia wholesale natural gas prices increased 61% in the last month. This may mean an increase of $60 per month in gas bills. Given the current economic conditions, $60 is not chicken feed.
That quotation belongs to Albert Einstein. He also said "not everything that counts can be counted, and not everything that can be counted counts."
Payrolls plunged by 308,000, and this was the sharpest drop since 9/11. Believe it or not payrolls had been expected to rise by 10,000. Just the other day I mentioned you could expect a downbeat employment report. Jobs, or the lack of, are going from bad to awful. You can expect it to get worse.
The Nikkei ended at a fresh 20 year low.
The dollar hit a new 4 year low vs the Euro and the Swiss franc.
The airline industry is expected to lose $6.5 billion in 2003.
Niccolo Machiavelli: "If an injury has to be done to a man it should be so severe that his vengeance need not be feared." I'm with you on this one, Niccolo.
Ulysses S. Grant: "I never advocated war except as a means of peace." Ditto.
The insured unemployment rate jumped to 2.8% from 2.6% in the latest week. This is meaningful.
February same store sales for Barnes and Noble were down 4.4% and for B. Dalton Bookseller down 12.3%. Are people reading less?
February same store sales for Federated were down 6.8%; for Ann Taylor's down 8.6%; and for Sears down 9.4%
Sears is trading at a 10 year low. When you pick bad management, you end up with disastrous results. This compares with WalMart, and the latter just increased its dividend for the 29th consecutive year. The great ones just keep performing. They walk the talk.
Thirty year mortgages hit a record low of 5.67%
Household debt rose 10.7% in the final quarter of 2002- the biggest jump in 13 years.
Mortgage debt rose 13.7%, and it was the biggest jump in 15 years.
Germany's unemployment rate rose to 11.3%. You thought we have it bad.
Iraq owes $2 billion to the USDA for loans that have gone unpaid since 1990 plus $1 billion in interest. These were guaranteed loans to buy U.S. food. In June 1990, just 2 months prior to the invasion of Kuwait, the first Bush Administration was against imposing sanctions on Iraq, and those sanctions would have blocked sales of U.S. food to Iraq.
In Georgia wholesale natural gas prices increased 61% in the last month. This may mean an increase of $60 per month in gas bills. Given the current economic conditions, $60 is not chicken feed.
Thursday, March 06, 2003
3/6/03 Part II: We Bleed Together
Operation Military Pride attempts to boost the morale of our troops thru cards, letters, and care packages. It's vital to support our troops- whether you are for or against the possible war with Iraq. Our troops bleed American blood. When one American bleeds, all Americans bleed. WE BLEED TOGETHER.
Pamela Bates launched her Hugs To Kuwait web site on January 4, and this was two days prior to her Army husband leaving for the middle east. In two short months she has arranged the adoption of about 10,000 troops. That's walking the talk!!!! Pamela Bates is some kind of winner.
Operation Military Pride attempts to boost the morale of our troops thru cards, letters, and care packages. It's vital to support our troops- whether you are for or against the possible war with Iraq. Our troops bleed American blood. When one American bleeds, all Americans bleed. WE BLEED TOGETHER.
Pamela Bates launched her Hugs To Kuwait web site on January 4, and this was two days prior to her Army husband leaving for the middle east. In two short months she has arranged the adoption of about 10,000 troops. That's walking the talk!!!! Pamela Bates is some kind of winner.
3/6/03 China
The jobless rate in China is at a 23 year high.
China expects a record budget deficit of $39 billion.
Eight million people each year enter the workforce in China. In order to create enough jobs the economy must grow at a 7% rate, and that is a tall order.
As in Japan, China faces a major problem with bad bank loans.
China backs France, Germany, and Russia and vows to block a UN resolution which would authorize war on Iraq.
U.S. distillate supplies drop to their lowest level for this time of year in 40 years. Crude inventories are 16% below year ago levels.
Japan's central bank raised the amount of excess cash in the financial market to up to $187 billion to try to help the stagnant economy.
Steelcase warns of more layoffs.
Last year Americans spent $14 billion on vitamins, minerals, and herbal products.
GM is considering the sale of all or part of its commercial mortgage business.
Schering Plough cut its 2003 earning s estimate to 75 to 85 cents from $1.
Jobs in the services sector fell in February. This sector accounts for 80% of the economy.
Unless Washington fiddles with the numbers, there will be a downbeat U.S. employment report out on Friday.
With growing uncertainities, hiring will be delayed this year, and layoffs shall continue.
The Reuters Eurozone Business Activity Index dropped to 48.9 in February, and this represented the first decline in 5 months and was weaker than expected.
Job cuts are coming to Toys "R" Us.
Coca Cola traded at a 7 year low. There were new lows for Kraft, Kellogg, and Adolph Coors.
PETsMART had disappointing results and a weak forecast.
WalMart's February sam store sales only grew at a 2.6% rate.
The ECB cut interest rates to 2.5%.
Swiss Life will report a loss of $1.28 billion.
The war warning has been reduced to "a few days" as the war cabinet is convened. It smells like war in the air, but to me it doesn't feel like war. I must go with my feelings. This war is preventable. The same was not true with the Gulf War. We must remember that, if emotions rule, our decision making will be compromised. When it comes to a possible war with Iraq or our war on terrorism, American lives must be protected. To defeat Iraq in a frightening flash requires no other country's assistance. To keep the peace requires the assistance of an army of countries. We need to win on both fronts.
The jobless rate in China is at a 23 year high.
China expects a record budget deficit of $39 billion.
Eight million people each year enter the workforce in China. In order to create enough jobs the economy must grow at a 7% rate, and that is a tall order.
As in Japan, China faces a major problem with bad bank loans.
China backs France, Germany, and Russia and vows to block a UN resolution which would authorize war on Iraq.
U.S. distillate supplies drop to their lowest level for this time of year in 40 years. Crude inventories are 16% below year ago levels.
Japan's central bank raised the amount of excess cash in the financial market to up to $187 billion to try to help the stagnant economy.
Steelcase warns of more layoffs.
Last year Americans spent $14 billion on vitamins, minerals, and herbal products.
GM is considering the sale of all or part of its commercial mortgage business.
Schering Plough cut its 2003 earning s estimate to 75 to 85 cents from $1.
Jobs in the services sector fell in February. This sector accounts for 80% of the economy.
Unless Washington fiddles with the numbers, there will be a downbeat U.S. employment report out on Friday.
With growing uncertainities, hiring will be delayed this year, and layoffs shall continue.
The Reuters Eurozone Business Activity Index dropped to 48.9 in February, and this represented the first decline in 5 months and was weaker than expected.
Job cuts are coming to Toys "R" Us.
Coca Cola traded at a 7 year low. There were new lows for Kraft, Kellogg, and Adolph Coors.
PETsMART had disappointing results and a weak forecast.
WalMart's February sam store sales only grew at a 2.6% rate.
The ECB cut interest rates to 2.5%.
Swiss Life will report a loss of $1.28 billion.
The war warning has been reduced to "a few days" as the war cabinet is convened. It smells like war in the air, but to me it doesn't feel like war. I must go with my feelings. This war is preventable. The same was not true with the Gulf War. We must remember that, if emotions rule, our decision making will be compromised. When it comes to a possible war with Iraq or our war on terrorism, American lives must be protected. To defeat Iraq in a frightening flash requires no other country's assistance. To keep the peace requires the assistance of an army of countries. We need to win on both fronts.
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