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."
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