9/13/03 For Whom The Bell Tolls
Since the beginning of the Iraq war on March 20, there have been 188 U.S. fatalities in combat and another 106 in accidents and other non-combat incidents. In Operation Desert Storm 148 were killed in combat and accidents killed another 145. As the casualties of the Iraq war have risen, Bush’s approval rating in the latest CNN-USA Today-Gallup poll has dropped to 52%, and that is down 7 points in the last month. While speaking to troops in Georgia, Bush remarked “no free nation can be neutral in the fight between civilization and chaos.” He might have added that no democracy is capable of providing for the safety of its citizens without the truth being told. The citizenry can handle the truth. Next week former U.N weapons inspector Kay returns from Iraq. He and his team have been hunting for the WMD. As David Albright, a former U.N. weapons inspector recently stated, “he’s not finding the kinds of things the administration expected to find- large quantities of biological and chemical weapons or evidence that they were destroyed prior to the war.” They have found zilch. How does Bush react to this revelation? At Ft Stewart, Georgia yesterday he remarked “because of our military, catastrophic weapons will no longer be in the hands of a reckless dictator.” What weapons? We went to war over WMD. The president and his team want to change the justification by saying removing Hussein was reason enough to go to war. That arrogant attitude is a one way ticket to palookaville.
Contract talks between the UAW and the big three auto companies are getting down to the wire. There’s plenty to discuss. GM has 2.8 hourly retirees per active hourly worker. Their hourly and salaried retiree pension plan is underfunded by $19 billion. In 2002 GM spent $4.5 billion on health care. The UAW wants to preserve health care benefits. The companies want to crack down on absenteeism. They wish increased worker flexibility so that employees can be moved from one job to another, depending on where they are needed. The 1999 agreement provided for 3% annual wage increases. This new agreement may allow for no increase in pay. A new labor pact will require give and take. Otherwise, Toyota will continue to win market share.
Yesterday economists were, once again, surprised by the news that consumer sentiment has fallen in September. The main culprits were 93,000 job cuts in August and record gasoline prices. We can add to that record beef prices and rapidly escalating plywood prices. In some areas of the country, sheets of plywood rose 80% in price from the level in August.
Next week the Fed meets on Sept 16. As the budget deficit rises beyond $500 billion, there is a need to sell more Treasury notes. This week’s auctions included the first September sale of five-year notes since 1997 and the first September sale of 10-year notes on record. I am certain we can expect more records broken in the very near future. The Fed will do its part to keep a lid on short-term rates. The Ponzi game continues into the next inning.
Friday, September 12, 2003
9/12/03 Footprints In The Quicksand
Bill Cheney, chief economist at John Hancock: “Right now we’re consuming everything in the world.”
How is it possible for there to be serious trouble when the GDP is expected to grow at a 5% rate from July to September? There are many aspects to the answer. Let’s begin with how Americans view life on Main Street. In the most recent IBD/TIPP National Outlook Index, which fell to 49.5, the lowest point since Bush took office, the president of TIPP described it this way: “two things are important to Americans- the job situation at home, and Iraq. Iraq more than terrorism is on Americans’ minds.” The “direction of the country index” fell to 48.1, the lowest point since the start of Bush’s term. 40% of Americans say they feel more at risk from terrorism today than before 9/11.
When it comes to unemployment, Challenger, Gray, and Christmas had something unsettling to say yesterday, and it was similar to what I have stated for months. They said the real unemployment rate was not 6.1% but rather 9.1%. The difference would be combining those out of work with those who have given up looking for a job. If you consider those who only can get part-time work, then the picture looks even grimmer. Of course, the manufacturing sector has been hit the hardest. In that sector 16% of that workforce or 2.7 million jobs have been cut in a record 37 straight months.
In sum, we are witnessing a landscape where companies have little or no top-line growth; prices are stagnant; there is a lack of spending on plant and equipment; and companies are axing employees. It’s more than just not hiring. It amounts to job losses.
The economists tell us that the economy is growing vigorously. Yet, August retail sales rose a disappointing 0.6%, down from 1.3% in July. The core PPI index rose only 0.1% in August, down from 0.2% in July. Purchase of building materials fell for the first time since February. In the tech sector, Oracle had a 7% drop in new software licensing in its fiscal first quarter. In sum, consumers have spent their tax benefits and child credits. We’re back to square one, and that means a very poor job picture and more of our troops getting killed in Iraq. Bill O’Reilly describes this as WWIII. Americans get what’s happening. It’s the politicians and the economists who are in the dark. That should come as no surprise.
Bill Cheney, chief economist at John Hancock: “Right now we’re consuming everything in the world.”
How is it possible for there to be serious trouble when the GDP is expected to grow at a 5% rate from July to September? There are many aspects to the answer. Let’s begin with how Americans view life on Main Street. In the most recent IBD/TIPP National Outlook Index, which fell to 49.5, the lowest point since Bush took office, the president of TIPP described it this way: “two things are important to Americans- the job situation at home, and Iraq. Iraq more than terrorism is on Americans’ minds.” The “direction of the country index” fell to 48.1, the lowest point since the start of Bush’s term. 40% of Americans say they feel more at risk from terrorism today than before 9/11.
When it comes to unemployment, Challenger, Gray, and Christmas had something unsettling to say yesterday, and it was similar to what I have stated for months. They said the real unemployment rate was not 6.1% but rather 9.1%. The difference would be combining those out of work with those who have given up looking for a job. If you consider those who only can get part-time work, then the picture looks even grimmer. Of course, the manufacturing sector has been hit the hardest. In that sector 16% of that workforce or 2.7 million jobs have been cut in a record 37 straight months.
In sum, we are witnessing a landscape where companies have little or no top-line growth; prices are stagnant; there is a lack of spending on plant and equipment; and companies are axing employees. It’s more than just not hiring. It amounts to job losses.
The economists tell us that the economy is growing vigorously. Yet, August retail sales rose a disappointing 0.6%, down from 1.3% in July. The core PPI index rose only 0.1% in August, down from 0.2% in July. Purchase of building materials fell for the first time since February. In the tech sector, Oracle had a 7% drop in new software licensing in its fiscal first quarter. In sum, consumers have spent their tax benefits and child credits. We’re back to square one, and that means a very poor job picture and more of our troops getting killed in Iraq. Bill O’Reilly describes this as WWIII. Americans get what’s happening. It’s the politicians and the economists who are in the dark. That should come as no surprise.
Thursday, September 11, 2003
9/11/03 Honoring With Honor
All Americans will forever remember the horror of two years ago on this day. Hopefully, honoring those who perished will make our nation stronger. Each individual can do his part, and I humbly suggest we honor the dead with the daily strength of speaking the truth. Words can be powerful, and the knowledge from those words can bring life to the weak.
I attempt each day to provide an economic and financial back drop which might illustrate the truths in our society and in our markets. Some suggest I have a negative bent. I suggest I tell the truth. I provide the facts. If the facts prove too harsh, then hit the delete button. But, don't whine to me. I adore caring for pigs but not whiners.
Unemployment is on the upswing. Yesterday was a bad day for workers. Levi Strauss is slashing 650 jobs, International Paper 3000, Champion Enterprises 1000, and Tellabs, which has already cut 4000 employees, is slashing some more. On average payrolls have declined 56,000 a month this year. Challenger, Gray, and Christmas said last month that U.S. workers are 25% more likely to lose a job between September and December than they were in the previous 8 months. It would appear their prediction is all too true as the number of new unemployment claims in the most recent week rose to the highest level in two months.
The U.S. July trade deficit widened to $40.32 billion, and our trade deficit with China was a record $11.3 billion and we also had a record trade deficit with Western Europe. We cntinue to spread the wealth.
It's about time the Senate did something positive. They are opposing Bush on the overtime issue. Let's see if he has the power of his conviction and the nerve to veto their action.
All Americans will forever remember the horror of two years ago on this day. Hopefully, honoring those who perished will make our nation stronger. Each individual can do his part, and I humbly suggest we honor the dead with the daily strength of speaking the truth. Words can be powerful, and the knowledge from those words can bring life to the weak.
I attempt each day to provide an economic and financial back drop which might illustrate the truths in our society and in our markets. Some suggest I have a negative bent. I suggest I tell the truth. I provide the facts. If the facts prove too harsh, then hit the delete button. But, don't whine to me. I adore caring for pigs but not whiners.
Unemployment is on the upswing. Yesterday was a bad day for workers. Levi Strauss is slashing 650 jobs, International Paper 3000, Champion Enterprises 1000, and Tellabs, which has already cut 4000 employees, is slashing some more. On average payrolls have declined 56,000 a month this year. Challenger, Gray, and Christmas said last month that U.S. workers are 25% more likely to lose a job between September and December than they were in the previous 8 months. It would appear their prediction is all too true as the number of new unemployment claims in the most recent week rose to the highest level in two months.
The U.S. July trade deficit widened to $40.32 billion, and our trade deficit with China was a record $11.3 billion and we also had a record trade deficit with Western Europe. We cntinue to spread the wealth.
It's about time the Senate did something positive. They are opposing Bush on the overtime issue. Let's see if he has the power of his conviction and the nerve to veto their action.
Wednesday, September 10, 2003
9/10/03 Outlining Expectations
The U.S. Army Guard and Reservists face extended tours of duty in Iraq and Kuwait, and will be required to serve up to 12 months in their areas of operation. Time spent at U.S. military basese awaiting deployment doesn't count. Lt. Gen. Roger Schultz, director of the U.S. Army National Guard in Washington said yesterday "we didn't do a very good job of outlining expectations, so right in the middle of a mission- a fairly difficult mission- we are changing the rotation policy as it affects Iraqi Freedom."
The S&P 500 has rallied 28% from the March 11 low. Accompanying this increase, come major expectations for increased earnings and enhanced economic visibility. There isn't any room for disappointment. Today, National City, a Cleveland based bank, lowered its financial outlook for 2003 to reflect the adverse impact of the recent rise in long-term rates on its mortgage business. When it comes to revised downward outlooks and rising long-term rates, National City will have plenty of company.
As I predicted back in July, mortgage lenders are cutting jobs. They aren't alone. 3COM will outsource all manufacturing of its computer-networking equipment and eliminate about 1,000 jobs or one-third of its employees.
The IBD/TIPP Economic Optimism Index dropped 2.3 points to 52.5 in September. Raghavan Mayur, president of TIPP, said "we are seeing a broad-based decline in economic confidence in September." He said the average reading of the last recession was 54.3. The six-month economic outlook fell 4.3 points to 51.
A new study reveals workers in employer-sponsored health plans are paying 48% more out of their own pay for medical care than just 3 years ago.
After 21 years at Sun Microsystems and as co-founder, Bill Joy, the Java pioneer, is leaving the company. There is only one Bill Joy. This is like Babe Ruth leaving Boston for New York.
The UAW's 4-year national contract covering 37,000 hourly workers and 522,000 retirees, surviving spouses, and dependents, expires at midnight Sunday. Chrysler wants to outsource "general service operators" or plant janitors, drive down absenteeism, and reduce job classification. Chrysler should also focus on Toyota. In August, Toyota's 3 brands, Tyota, Lexus, and Scion, eclipsed the combined Chrysler, Dodge, and Jeep U.S. monthly sales for the first time.
The U.S. Army Guard and Reservists face extended tours of duty in Iraq and Kuwait, and will be required to serve up to 12 months in their areas of operation. Time spent at U.S. military basese awaiting deployment doesn't count. Lt. Gen. Roger Schultz, director of the U.S. Army National Guard in Washington said yesterday "we didn't do a very good job of outlining expectations, so right in the middle of a mission- a fairly difficult mission- we are changing the rotation policy as it affects Iraqi Freedom."
The S&P 500 has rallied 28% from the March 11 low. Accompanying this increase, come major expectations for increased earnings and enhanced economic visibility. There isn't any room for disappointment. Today, National City, a Cleveland based bank, lowered its financial outlook for 2003 to reflect the adverse impact of the recent rise in long-term rates on its mortgage business. When it comes to revised downward outlooks and rising long-term rates, National City will have plenty of company.
As I predicted back in July, mortgage lenders are cutting jobs. They aren't alone. 3COM will outsource all manufacturing of its computer-networking equipment and eliminate about 1,000 jobs or one-third of its employees.
The IBD/TIPP Economic Optimism Index dropped 2.3 points to 52.5 in September. Raghavan Mayur, president of TIPP, said "we are seeing a broad-based decline in economic confidence in September." He said the average reading of the last recession was 54.3. The six-month economic outlook fell 4.3 points to 51.
A new study reveals workers in employer-sponsored health plans are paying 48% more out of their own pay for medical care than just 3 years ago.
After 21 years at Sun Microsystems and as co-founder, Bill Joy, the Java pioneer, is leaving the company. There is only one Bill Joy. This is like Babe Ruth leaving Boston for New York.
The UAW's 4-year national contract covering 37,000 hourly workers and 522,000 retirees, surviving spouses, and dependents, expires at midnight Sunday. Chrysler wants to outsource "general service operators" or plant janitors, drive down absenteeism, and reduce job classification. Chrysler should also focus on Toyota. In August, Toyota's 3 brands, Tyota, Lexus, and Scion, eclipsed the combined Chrysler, Dodge, and Jeep U.S. monthly sales for the first time.
Monday, September 08, 2003
Posting for Tuesday
9/09/03 Termites In The Woodwork
W.D. Gann, who died in 1955, is well known for his geometric angles. Many professional investors have looked down on Gann as a financial astrologer. Most of these naysayers couldn’t carry his briefcase. I have long appreciated Gann’s emphasis on patience, a healthy mind and body, and the daily thirst for knowledge. He focused on not losing money, and realizing the power of risk and reward as he waited until the risk/reward ratio was 90% in his favor prior to investing. He did not believe in debt, never drank alcohol, and didn’t drink or take drugs. Gann stated “do the opposite of the masses, and you will make money.” He said “the man who looks forward and sees the darkest side and prepares for it is the man who will succeed, and the nation that prepares for the worst will not have to face the worst.”
John Maynard Keynes: “When the facts change, I change my mind. What do you do, sir?”
The equity tension index (EqTI), says Howard Simons, “is based on the premise that a market’s volatility structure and forward curve each convey as much useful trading information as does the price itself.”
Economist William Gale, a senior fellow at the Brookings Institute, stated “the deficit is not the wolf at the door; it’s more the termites in the woodwork.”
Singapore’s Ministry of Health said on Monday that one man’s “initial tests seem to indicate this person has the SARS virus, but we are doing further tests tonight.”
International Atomic Energy Agency chief Mohamed ElBaradei said “no indication of post-1991 weaponization activities was uncovered in Iraq. In the areas of uranium acquisition, concentration and centrifuge enrichment, extensive field investigation and document analysis revealed no evidence that Iraq had resumed such activities.” His experts had withdrawn from Iraq before the war began in March. He said “the agency observed a substantial degradation in facilities, financial resources and programs throughout Iraq that might support a nuclear infrastructure. The former cadre of nuclear experts was being increasingly dispersed and many key figures were reaching retirement or had left the country.” The International Atomic Energy Agency has a 35-nation board of governors. The aforementioned facts place considerable doubt on Iraq’s nuclear terrorist capabilities. I feel confident that our CIA shared the same view and information. It must have been delayed getting to the White House. Movement over the desert sands takes time.
9/09/03 Termites In The Woodwork
W.D. Gann, who died in 1955, is well known for his geometric angles. Many professional investors have looked down on Gann as a financial astrologer. Most of these naysayers couldn’t carry his briefcase. I have long appreciated Gann’s emphasis on patience, a healthy mind and body, and the daily thirst for knowledge. He focused on not losing money, and realizing the power of risk and reward as he waited until the risk/reward ratio was 90% in his favor prior to investing. He did not believe in debt, never drank alcohol, and didn’t drink or take drugs. Gann stated “do the opposite of the masses, and you will make money.” He said “the man who looks forward and sees the darkest side and prepares for it is the man who will succeed, and the nation that prepares for the worst will not have to face the worst.”
John Maynard Keynes: “When the facts change, I change my mind. What do you do, sir?”
The equity tension index (EqTI), says Howard Simons, “is based on the premise that a market’s volatility structure and forward curve each convey as much useful trading information as does the price itself.”
Economist William Gale, a senior fellow at the Brookings Institute, stated “the deficit is not the wolf at the door; it’s more the termites in the woodwork.”
Singapore’s Ministry of Health said on Monday that one man’s “initial tests seem to indicate this person has the SARS virus, but we are doing further tests tonight.”
International Atomic Energy Agency chief Mohamed ElBaradei said “no indication of post-1991 weaponization activities was uncovered in Iraq. In the areas of uranium acquisition, concentration and centrifuge enrichment, extensive field investigation and document analysis revealed no evidence that Iraq had resumed such activities.” His experts had withdrawn from Iraq before the war began in March. He said “the agency observed a substantial degradation in facilities, financial resources and programs throughout Iraq that might support a nuclear infrastructure. The former cadre of nuclear experts was being increasingly dispersed and many key figures were reaching retirement or had left the country.” The International Atomic Energy Agency has a 35-nation board of governors. The aforementioned facts place considerable doubt on Iraq’s nuclear terrorist capabilities. I feel confident that our CIA shared the same view and information. It must have been delayed getting to the White House. Movement over the desert sands takes time.
9/08/03 Shock-And-Awe
The President’s speech last night reflected the shock-and-awe of human sacrifices and mounting costs of the war in Iraq. The American people and the world were told over and over again that the reason for this war was the massive array of WMD. Last night no mention was made of the daily urgent hunt for the WMD, and the lack of success in finding even a small cache of such weapons. Let there be no misunderstanding. I fiercely and proudly bleed red, white, and blue. Unfortunately, that doesn’t mean I support errors of omission. The President stated “we will do whatever is necessary.” I say go to main street and not land on the U.S. Abraham Lincoln. Listen to the words of LT. Gen. Ricardo Sanchez, the commander of U.S. forces in Iraq: “If a militia or an internal conflict of some nature were to erupt, that would pose a challenge…that I do not have sufficient forces for. The coalition lacks sufficient troops to protect Iraq’s porous borders or its thousands of miles of highways.” Obviously, we aren’t doing whatever is necessary to win the “mop-up operation.” Congress had been told that up to $80 billion would be required for the Iraq reconstruction effort. Now the President asks for another $87 billion. It sounds like the CBO forecasting a budget deficit of $167 billion about 10 months ago, and now they estimate the total to be at least $465 billion. These people either don’t know what they’re doing or they provide errors of omission or both. Any way you look at it, they can’t hack it and won’t admit they mishandled the war effort as well as the economy. A new Zogby International poll puts Bush’s approval rating at 54% negative and 45% positive. After last night’s speech, I would imagine the negative factor would increase once again. Winners don’t look to justify failure.
With respect to the Homeland Security department, a White House official who handles homeland-security issues and who asked not to be identified, said “not a lot is getting done at the top of the department, and nobody’s making them focus on it.” Last week two top officials in that department stepped down amidst growing criticism.
President Bush: “The Americans who assume great risks overseas understand the great cause they are in.” As the polls indicate, the people of Great Britain don’t understand this same cause, and they are our only significant partner in Iraq. Despite growing outrage over the country’s participation in Iraq, Britain’s top government officials announced sending 1200 more troops to Iraq.
Larry Ellison: “We saw the zenith in tech jobs around 2001. We saw a point where half of all capital spending was tech. That will never happen again. My industry will never come back. Nor should it. Computer systems are still too expensive. They’re too labor intensive.”
The annual OracleWorld conference opens today in San Francisco. Grid computing will be the center piece of Oracle speak. On Friday the company will announce quarterly results.
The war in Iraq and today’s equity investing have one large commonality- they both lack an exit strategy.
The President’s speech last night reflected the shock-and-awe of human sacrifices and mounting costs of the war in Iraq. The American people and the world were told over and over again that the reason for this war was the massive array of WMD. Last night no mention was made of the daily urgent hunt for the WMD, and the lack of success in finding even a small cache of such weapons. Let there be no misunderstanding. I fiercely and proudly bleed red, white, and blue. Unfortunately, that doesn’t mean I support errors of omission. The President stated “we will do whatever is necessary.” I say go to main street and not land on the U.S. Abraham Lincoln. Listen to the words of LT. Gen. Ricardo Sanchez, the commander of U.S. forces in Iraq: “If a militia or an internal conflict of some nature were to erupt, that would pose a challenge…that I do not have sufficient forces for. The coalition lacks sufficient troops to protect Iraq’s porous borders or its thousands of miles of highways.” Obviously, we aren’t doing whatever is necessary to win the “mop-up operation.” Congress had been told that up to $80 billion would be required for the Iraq reconstruction effort. Now the President asks for another $87 billion. It sounds like the CBO forecasting a budget deficit of $167 billion about 10 months ago, and now they estimate the total to be at least $465 billion. These people either don’t know what they’re doing or they provide errors of omission or both. Any way you look at it, they can’t hack it and won’t admit they mishandled the war effort as well as the economy. A new Zogby International poll puts Bush’s approval rating at 54% negative and 45% positive. After last night’s speech, I would imagine the negative factor would increase once again. Winners don’t look to justify failure.
With respect to the Homeland Security department, a White House official who handles homeland-security issues and who asked not to be identified, said “not a lot is getting done at the top of the department, and nobody’s making them focus on it.” Last week two top officials in that department stepped down amidst growing criticism.
President Bush: “The Americans who assume great risks overseas understand the great cause they are in.” As the polls indicate, the people of Great Britain don’t understand this same cause, and they are our only significant partner in Iraq. Despite growing outrage over the country’s participation in Iraq, Britain’s top government officials announced sending 1200 more troops to Iraq.
Larry Ellison: “We saw the zenith in tech jobs around 2001. We saw a point where half of all capital spending was tech. That will never happen again. My industry will never come back. Nor should it. Computer systems are still too expensive. They’re too labor intensive.”
The annual OracleWorld conference opens today in San Francisco. Grid computing will be the center piece of Oracle speak. On Friday the company will announce quarterly results.
The war in Iraq and today’s equity investing have one large commonality- they both lack an exit strategy.
Sunday, September 07, 2003
9/07/03 The Road Map To Patience
This evening the president will address the nation and outline the progress made in Iraq, and he will ask for more patience to finish the job. Having not seen the speech, I would doubt much time is devoted to a discussion of the WMD, the reason provided for initiating this conflict. I doubt much time will be devoted to the 149 men and women in uniform who have died in Iraq since May 1. In fact, a mention of the wounded may not be forthcoming. On the other hand, Rumsfeld may have given us a clue as to the tenor of the talk when he said yesterday “the Iraqi people are so much better off than four or five months ago.” I wonder if the American people are better off than they were in January, 2001 when Bush was inaugurated. While Bush asks for patience, the city of Santa Cruz is moving in an opposite direction. Their city council will consider Tuesday a measure that, if passed, would give members the go-ahead to send a letter of inquiry to Congress. The Santa Cruz Mayor and Vice Mayor and one councilman have already signed a draft of a letter to members of the House Judiciary Committee asking them whether any of Bush’s conduct equated to an impeachable offense, such as, whether Bush violated international treaties and the U.S. Constitution by invading and occupying Iraq. The Mayor said “we have to know why the Bush administration lied to us about Iraq.”
On Wednesday the World Trade Organization summit is set to open in Cancun, Mexico. The United States has tried to lower expectations about the outcome of the talks. The main problems focus on agricultural subsidies in developed countries and lower tariffs for manufactured products. Adriano Campolina Soares, director of ActionAid Brazil, stated “people think you in the United States are only willing to give peanuts on agricultural concessions but are charging an amazingly enormous price for that, which are the new issues.” These new issues include government procurement, competition, trade facilitation and a new investment agreement to limit governments’ ability to place checks on trade and investment.
Silicon Valley’s Santa Clara County had 864,500 non-farm jobs in July, about the same number as it had 7 ½ years ago in the beginning of 1996. This week analysts raised their earnings estimates for Siebel Systems and Oracle. With revenue growth missing and a job-loss recovery, I think these analysts are out to lunch. These are the same folks who said tech stocks were going to the moon in 1999 and early 2000. I suggest they should be added to the unemployment rolls. Meanwhile, Jim Cunneen, president of the San Jose Silicon Valley Chamber of Commerce, stated “ we won’t have a meaningful recovery until jobs are added.”
China’s central bank said its economic policy units “unanimously think that the bank loans right now are increasing too fast.” Chinese banks lent more money in the first 7 months of 2003 than in all of last year. Standard & Poor’s estimates that borrowers have defaulted on nearly half of all bank loans in China.
This evening the president will address the nation and outline the progress made in Iraq, and he will ask for more patience to finish the job. Having not seen the speech, I would doubt much time is devoted to a discussion of the WMD, the reason provided for initiating this conflict. I doubt much time will be devoted to the 149 men and women in uniform who have died in Iraq since May 1. In fact, a mention of the wounded may not be forthcoming. On the other hand, Rumsfeld may have given us a clue as to the tenor of the talk when he said yesterday “the Iraqi people are so much better off than four or five months ago.” I wonder if the American people are better off than they were in January, 2001 when Bush was inaugurated. While Bush asks for patience, the city of Santa Cruz is moving in an opposite direction. Their city council will consider Tuesday a measure that, if passed, would give members the go-ahead to send a letter of inquiry to Congress. The Santa Cruz Mayor and Vice Mayor and one councilman have already signed a draft of a letter to members of the House Judiciary Committee asking them whether any of Bush’s conduct equated to an impeachable offense, such as, whether Bush violated international treaties and the U.S. Constitution by invading and occupying Iraq. The Mayor said “we have to know why the Bush administration lied to us about Iraq.”
On Wednesday the World Trade Organization summit is set to open in Cancun, Mexico. The United States has tried to lower expectations about the outcome of the talks. The main problems focus on agricultural subsidies in developed countries and lower tariffs for manufactured products. Adriano Campolina Soares, director of ActionAid Brazil, stated “people think you in the United States are only willing to give peanuts on agricultural concessions but are charging an amazingly enormous price for that, which are the new issues.” These new issues include government procurement, competition, trade facilitation and a new investment agreement to limit governments’ ability to place checks on trade and investment.
Silicon Valley’s Santa Clara County had 864,500 non-farm jobs in July, about the same number as it had 7 ½ years ago in the beginning of 1996. This week analysts raised their earnings estimates for Siebel Systems and Oracle. With revenue growth missing and a job-loss recovery, I think these analysts are out to lunch. These are the same folks who said tech stocks were going to the moon in 1999 and early 2000. I suggest they should be added to the unemployment rolls. Meanwhile, Jim Cunneen, president of the San Jose Silicon Valley Chamber of Commerce, stated “ we won’t have a meaningful recovery until jobs are added.”
China’s central bank said its economic policy units “unanimously think that the bank loans right now are increasing too fast.” Chinese banks lent more money in the first 7 months of 2003 than in all of last year. Standard & Poor’s estimates that borrowers have defaulted on nearly half of all bank loans in China.
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