12/28/02 No Santa Claus Rally
For the second day in a row the Dow and the Nasdaq closed near their session lows. The S&P 500 index closed at its lowest level in more than 2 months.
800,000 jobless lose their unemployment benefits today.
According to a recent poll, the vast majority of Americans believe the U.S. is very likely or somewhat likely to go to war with Iraq. There is a new moon around Feb 1, and that could be a possible date for the war to begin.
McDonald's is planning to introduce a new beef patty this Spring. Maybe I should ask for the recipe.
Ethan Allen opened its first store in China. Does that mean China will now be making their furnitiure?
Applied Biosystems to cut 9% of their workforce.
Friday, December 27, 2002
Thursday, December 26, 2002
12/26/02 Too Little Too Late
That's how WalMart described their holiday season business. Despite a couple of strong days just before Christmas, the company lowered its December same-store sales outlook to be up 2 to 3% rather than the previous 3 to 5% guidance. At this point, it is realistic to expect reduced expectations from other retailers.
There are still 3 1/2 million Americans receiving jobless benefits. A significant portion of those will have those benefits end in the next few days. This fact had to impact holiday sales.
That's how WalMart described their holiday season business. Despite a couple of strong days just before Christmas, the company lowered its December same-store sales outlook to be up 2 to 3% rather than the previous 3 to 5% guidance. At this point, it is realistic to expect reduced expectations from other retailers.
There are still 3 1/2 million Americans receiving jobless benefits. A significant portion of those will have those benefits end in the next few days. This fact had to impact holiday sales.
Wednesday, December 25, 2002
12/25/02 Merry Christmas
According to the Stock Trader's Almanac, going back most of this century, about 45% of all stock market gains come in the year preceding an election year. In fact, the third year of a term produces about 3 times as many up years as down years.
The stock market seems headed for its third down December in six years. 2002 will be the first time since 1942 that the market has been down in 3 consecutive years. At the same time, so far this quarter the Dow is up 11%, the Nasdaq 17%, and the S&P 9%.
Crude oil prices have gained 17% since the start of the strike in Venezuela.
Gold is at a 5 1/2 year high at $347 per ounce.
We know that companies are looking for ways to cut costs. The daily layoffs are a daily reminder. What would Jack Welch say about this? In 2001 only 434 civilian federal government workers, out of a 3 million plus workforce, were fired. I guess the rest were great job performers and are a significant reason that this country's productivity is on the rise. Hello! Anyone home?
The treasury department asked Congress to increase the government's borrowing authority, and warned the current $6.4 trillion debt limit may be reached within 60 days. How is that possible? Only a month or so ago the budget deficit for the year ending next September was estimated at $146 billion. To exceed the debt limit the deficit would need to be $100 billion more than just estimated. When will Americans elect officials who actually will reduce the net outflow of government funds? The government produces absolutely nothing, and should be viewed as the employer and spender of last resort. Unlike the vast majority of Americans, do you think civilian federal government workers are worried this holiday season about losing a job or having their hours cut? Do they plan for the worst case scenario? I think not.
According to the Stock Trader's Almanac, going back most of this century, about 45% of all stock market gains come in the year preceding an election year. In fact, the third year of a term produces about 3 times as many up years as down years.
The stock market seems headed for its third down December in six years. 2002 will be the first time since 1942 that the market has been down in 3 consecutive years. At the same time, so far this quarter the Dow is up 11%, the Nasdaq 17%, and the S&P 9%.
Crude oil prices have gained 17% since the start of the strike in Venezuela.
Gold is at a 5 1/2 year high at $347 per ounce.
We know that companies are looking for ways to cut costs. The daily layoffs are a daily reminder. What would Jack Welch say about this? In 2001 only 434 civilian federal government workers, out of a 3 million plus workforce, were fired. I guess the rest were great job performers and are a significant reason that this country's productivity is on the rise. Hello! Anyone home?
The treasury department asked Congress to increase the government's borrowing authority, and warned the current $6.4 trillion debt limit may be reached within 60 days. How is that possible? Only a month or so ago the budget deficit for the year ending next September was estimated at $146 billion. To exceed the debt limit the deficit would need to be $100 billion more than just estimated. When will Americans elect officials who actually will reduce the net outflow of government funds? The government produces absolutely nothing, and should be viewed as the employer and spender of last resort. Unlike the vast majority of Americans, do you think civilian federal government workers are worried this holiday season about losing a job or having their hours cut? Do they plan for the worst case scenario? I think not.
Tuesday, December 24, 2002
12/24/02 Posting #2 Haram
Haram is the Arabic word for forbidden. In Saudi Arabia churches are not permitted. Islam is the only accepted religion. As such, to celebrate Christmas one must have a very private gathering in one's home.
During these difficult and stressful times we sometimes overlook the wonders of freedom, and religious freedom is an important part of every day American life. We are indeed very lucky to be U.S. citizens.
Haram is the Arabic word for forbidden. In Saudi Arabia churches are not permitted. Islam is the only accepted religion. As such, to celebrate Christmas one must have a very private gathering in one's home.
During these difficult and stressful times we sometimes overlook the wonders of freedom, and religious freedom is an important part of every day American life. We are indeed very lucky to be U.S. citizens.
12/24/02 Sectors In The S&P 500
For the first time since the bear market started in 2000, every one of the 10 broad sectors in the S&P 500 index dropped in 2002.
Oil hits a 22 month high at $31.43 per barrel. Gasoline prices rose at the pump this week.
November durable goods orders fell 1.4%. Without military orders, the fall would have been 2.3%. It should be noted that economists had predicted a small gain.
According to a poll taken by the Atlanta Journal-Constitution, 30% of those living in the state of Georgia said the economy is declining, and 50% said it is neither mending nor decaying. If people feel this way, it's no wonder that retail holiday sales are disappointing.
For the first time since the bear market started in 2000, every one of the 10 broad sectors in the S&P 500 index dropped in 2002.
Oil hits a 22 month high at $31.43 per barrel. Gasoline prices rose at the pump this week.
November durable goods orders fell 1.4%. Without military orders, the fall would have been 2.3%. It should be noted that economists had predicted a small gain.
According to a poll taken by the Atlanta Journal-Constitution, 30% of those living in the state of Georgia said the economy is declining, and 50% said it is neither mending nor decaying. If people feel this way, it's no wonder that retail holiday sales are disappointing.
Monday, December 23, 2002
12/23/02 Inktomi
Several months ago I mentioned that, in my view, those who purchased internet stocks at highly inflated 2000 prices would not get their capital returned to them. They might rally, I said, from pennies to single digits and to expect nothing more.
Today Yahoo announced the purchase of Inktomi. The latter's shareholders will get less than $2 a share. This is better than pennies and more could not have been anticipated. Inktomi continues to lose money and layoff employees. As a stand-alone company, they didn't have a future. This is not the exception to the rule, but rather the legacy of the dotcoms. What a waste of capital and human effort.
Several months ago I mentioned that, in my view, those who purchased internet stocks at highly inflated 2000 prices would not get their capital returned to them. They might rally, I said, from pennies to single digits and to expect nothing more.
Today Yahoo announced the purchase of Inktomi. The latter's shareholders will get less than $2 a share. This is better than pennies and more could not have been anticipated. Inktomi continues to lose money and layoff employees. As a stand-alone company, they didn't have a future. This is not the exception to the rule, but rather the legacy of the dotcoms. What a waste of capital and human effort.
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